2011 was dominated by a false unity for the left. Labour behaved as if it were still in government – loyalty was valued above all else and its words were assumed to constitute action. The first few weeks of this year have seen a clear change approach. By shifting emphasis on the party’s economic and fiscal stance, Ed Balls and Ed Miliband have exposed the reality of a fragmented left. The divisions are now in full view. Such is the nature of political change – a new perspective emerges.
As this reality has emerged, we’ve only had the language of the past to cope. The prism is still Blairism v Brownism v the hard left. But these terms are from another time and fail completely in describing the contemporary conversation within the Labour party. It’s moved on but our language is stuck in the past.
Before we go into the new left tribes, it is worth exploring exactly what has happened since Ed Balls’s interview in the Guardian and speech at the Fabian conference last Saturday. As Steve Richards rightly observed in his column this week, there has been no u-turn and Jonathan Freedland has argued a similar thing. The acceptance of a cap on public sector pay increases is new but in line with what Ed Balls has argued previously, most notably in his conference speech last year. Nonetheless, a major change has occurred. There has been a shift of emphasis from the left the right leg. Labour is now able to walk instead of having to hop everywhere.
Leftist reactions to this shift have fallen into four broad camps: the hard realists, the soft realists, the change the conversationists, and the not for turning set. At the moment the party leadership itself is still flirting with all of these but seems positioned somewhere between hard and soft realism. Unfortunately, these four positions are mutually exclusive. You can’t flit between each of them in turn without leaving an almighty political mess. So, yes, those tough political choices will need to made or, at least, more firmly established. The mood music seems to be in hard realism’s favour – but not decisively.
Hard realism is essentially the position outlined in the In the black Labour paper and variants. You have to be clear about your fiscal approach in 2015 with rules attached, specify the cuts you would make in the meantime and beyond as clearly as possible, and be clear about your priorities in a constrained fiscal environment.
In other words, it is an approach where fiscal and economic limits and risks are taken into account which forms the basis of a credible economic and fiscal policy. It has the added bonus, if it works as an argument, of managing the political downside of being seen to be irresponsible. Economic and fiscal policy should be flexible, pragmatic but follow a clear policy of deficit reduction of which short-term stimulus could be a part. The politics comes second.
It is actually the opposite of Coalition ‘austerity’ which pursues fiscal consolidation whatever the economic context. Osborne’s is a damaging way of getting back on a sustainable path which, even if it does work, will cause unnecessary suffering. So those, such as Howard Reed, who argue that this is waving a ‘white flag’ have rather missed the point. It is a very distinctive perspective and approach to Osborne austerity.
It’s where Ed Balls’s speech seemed to lie last Saturday. It’s where a plurality of the British public are to be found: they support Labour’s new line on the cuts by 43% to 26% according to Comres. Labour voters are against by 38%-31% (which is hardly surprising given they’ve been told for eighteen months that cuts weren’t necessary). They support the line on public sector pay by 50% to 28% and that includes a plurality of Labour supporters 41%-38%.
It is to this political reality that the soft realists respond. Polly Toynbee is now the leading voice of this perspective. Essentially, it argues that the political reality is that Labour has to say something about the deficit and cuts but where it proposes fiscal consolidation it should be consistent with the social democratic argument.
Toynbee signed off her column yesterday with the line: “winning the election matters most” (that’s important but being able to govern once in office is as important, if not more so some may argue). Public sector pay doesn’t come first. Consolidation should be achieved by stopping things like HS2, Trident, clamping down on tax havens, taxing wealth and a state investment bank, work for the long term unemployed, restoring the worst cuts and building more houses, come first. So there are few painful cuts in there but the fiscal credibility frame is acknowledged. Many in the shadow cabinet and the parliamentary Labour party find themselves in this position.
Others, however, still find themselves in a ‘change the conversation’ position. This was the dominant position in the party until very recently but now it finds itself considerably weakened. Politically, its proponents are in a similar place to the soft realists. However, they refuse to accept the deficit frame. Instead, as Sunny Hundal has argued both on this website and Twitter over the last few days, to talk cuts and deficit is to play the Coalition’s game and betray the base.
They accuse others of triangulation but this is a classic triangulation (which makes the title of Hundal’s piece from last Friday rather curious) – change the conversation and build support as a consequence. The problem is, as has now been tacitly acknowledged by the leadership, this hasn’t worked to build either economic or political credibility.
The other internal contradiction here, and this is shared by the soft realists also, is that it argues for a ‘base’ strategy in some respects, eg opposing all cuts. However, ‘the base’ (whatever that means) is strongly in favour of the benefit cap (61% of Labour voters support a cap at the level set by the Coalition or less) and favour the immigration cap. If you are going to pursue a ‘base strategy’ then you have to at least be consistent.
Nobody can accuse the ‘not for turning’ set of inconsistency. Of course, here you will find trade union general secretaries, bloggers and writers such as Owen Jones, journalists such as Seamus Milne, campaign groups such as Occupy and UK Uncut, and economists of an ultra-Keynesian disposition. The argument (with much internal variation) is that the cuts aren’t necessary, the debt doesn’t apply to nations with their own currency, and there are billions of pounds of unclaimed taxes that can fund public services adequately.
The argument is clear, uncompromising, and assertive. This perspective has the activists, the money, a media profile, the institutional power, and a complete ceiling on potential support. Its ideas are radical but the simple fact is, unless there is a massive and seismic shift in public and expert opinion, they will never be put into action. Their power is within the left only.
And out of these divides in the broad left ,of which Labour is only one part, the party has to somehow come up with a governing and political strategy that will build a majority and sustain it in office. Ed Balls and Ed Miliband should have our complete sympathy. They could do with a bit more help from their shadow cabinet colleagues – and soon.
The best thing may well to address the fundamental arguments instead. Rather than pitch towards this faction or that, set a course and follow it. It is a conversation with the public that is needed rather than the navigation of the factional left. Leadership is not a series of tactical shifts or a desperate pitch to swing voters. It is about creating a credible argument for our national future. The Coalition is failing on jobs, on growth, on the economy, on reform, and on fairness. The left’s argument is divided. The trick for the leadership will be not to get too distracted. And the first real test is with the publication of this week’s growth figures.