Six Short Responses to the Six Key Criticisms of Black Labour

In the space of one week In the Black Labour has stimulated debate across the Party. There has been both support and opposition. This is an attempt to respond as briefly as possible to what seem to me to be the main criticisms.

1. Black Labour is just New Labour Reheated.

This couldn’t be more wrong. In fact the ideas outlined in the paper are the mirror image of New Labour. The last Government ploughed large sums of money into public services and welfare while trusting the market to deliver the most competitive and balanced economy free of state intervention. By contrast, Black Labour urges the Party to accept that the time of plenty in public spending is long past but that state activism in the form of imaginative tax, regulatory and institutional reform are the best routes to lasting equality.

2. Black Labour presses a cynical strategy on the Party urging it to accept Tory lies about Labour’s economic record in order to win votes.

The In The Black paper actually says very little about Labour’s record. It does not, for example, suggest that Labour apologises for its time in office. Instead it focuses on how Labour can develop an election-winning strategy by facing up to the reality, which most of the electorate seem to have accepted, that there is much less money to spend now or in the future.

3. Black Labour urges the Party to accept the entirety of the Tories spending plans and would leave it with no dividing lines with the Government making voting Labour pointless.

There are two responses to this. Firstly, the substance is untrue. The paper does not rule out a slower pace of deficit reduction nor even a small stimulus. What it does urge is Labour to be much clearer about when it would aim to clear the deficit and how it would be held to account for achieving this target. In addition, the paper suggests that the Party adopt a much more proactive growth strategy than the Government to drive competitiveness and equality.

Secondly, the criticism ignores the fact that the main hurdle that Labour currently faces is not that it is insufficiently differentiated from the Government but that the public have lost trust in the Party’s competence to govern the economy. Creating dividing lines with the Coalition will secure few votes until that trust has been won back.

4. Black Labour is wrong on the economics. The only way to reduce the deficit is to raise growth through stimulus.

This raises big issues which cannot be answered in the space of a paragraph or two. Suffice it to say here that while the Government’s deficit reduction plan may be too rigid, the opportunity to borrow significant amounts of money to spend on stimulus without a reasonable risk of higher interest rates does not exist. In addition, there is little evidence to suggest that austerity is the main driver of the current slowdown so that while a slower pace of deficit reduction would be welcome it would not make a very significant difference to the inflationary pressures, constrained credit or lack of confidence that are the main causes of the current problems.

5. The policy detail of Black Labour is too sketchy particularly the part that deals with the types of tax, regulatory and institutional reform that could improve social justice and equality.

Well, yes. But the paper is only five pages long. Our aim is to create a very open debate in the Party which will hopefully begin to fill in some of the missing detail.

6. ‘Fiscal conservatism’ is a horrible phrase that concedes too much ground to the right and risks alienating potential allies for Black labour.

The phrase may not appeal to everybody but it does capture the need for a really radical response both to the crisis we face in the public finances and to the deep mistrust which Labour must confront. Alternative phrases such as ‘fiscal sustainability’, ‘fiscal prudence’ or ‘fiscal caution’ seemed to lack the necessary impact.