Fight against austerity shows why Labour factions must come together

The Broadbent Institute’s annual Summit was described to me by a leading Canadian businessman as “the Davos of progressive politics”.

I have yet to make it to Davos but I doubt it is as effective at creating and distributing value as Broadbent.

The Institute was founded by Ed Broadbent (who led Labour’s sister Party, the New Democratic Party of Canada, from 1975-1989) to “support social democracy and justice and provide innovative solutions for an equal society’” It is funded by donations from individuals and unions such as Canadian Union of Public Employees and United Steelworkers. It is non-partisan but progressive. Over 1,000 people attended the sold out Summit to hear from North American politicians, trade union leaders, community organisers, as well as progressive ‘pop stars’ such as  James Galbraith, Gloria Steinem and Owen Jones. I was asked if the UK had anything like it and I came to the conclusion that, unfortunately, we do not.

I was there to respond to Galbraith in a session entitled ‘Progressive Economics in the Age of Inequality and Slow Growth’. As an MP you do get to meet some very important people. But I have rarely been so delighted and intimidated as I was to share a platform with one of the world’s leading economic thinkers and the son of the one of the world’s greatest ever economists: J K Galbraith, author and founder of ‘Institutional economics’.  

The Global Financial Crisis should have discredited neoliberal economics, the agency model of corporate governance, credit rating agencies and the casino capitalism of financial services. And yet, with the exception of a small number of voices in the economic wilderness like James Galbraith, it was the left that appeared to be without a coherent economic narrative. And we are still paying the price.

In October the NDP lost heavily in the Canadian elections. Of 103 MPs, only 44 were returned, dropping the party out of opposition.

The NDP ran the election on a platform that can probably best be described as austerity-lite. Sound familiar? Whilst promising major investments in new social programs, they said they would coninue the fiscal aims of the ruling Conservative government under right wing ideologue Stephen Harper, balance the books and not run deficits.

The Liberal Party on the other hand was committed to run deficits to fund investment. With a young, charismatic leader, Trudeau, son of previous charismatic Canadian Prime Minister, the Liberals outflanked the NDP on the left fiscally whilst promising to raise taxes on the highest income earners and take more refugees. They won by a landslide, going from 36 to 184 seats.

A lot of the debate at the summit centred on what the response on the left should be to the apparent polarisation of politics, as analysed recently in the Economist. Some argued for proportional representation. The Canadian system is similar to the UK’s and the current Trudeau Government won a majority on only 39.47 per cent of the vote.

Others emphasised increased diversity and focus on what matters now to working people. James Galbraith argued for institutional change and the three priorities of his friend – and home Senator – Bernie Sanders – tuition fees, challenging wealth inequality and getting big money out of politics.  My fellow respondent to Galbraith, John Horgan, NDP leader in the state of British Columbia hoping to take power in elections next year, announced a commitment to universal childcare.

I argued, as in my response to the Budget, that we have to show we know what counts today and also what will matter in the economy of the future. We have to offer a message of hope, and I am pleased that Jeremy Corbyn, John McDonnell and Tom Watson have all been talking positively about technology. Yanis Varoufakis, recently advised us to follow the example of Harold Wilson and weld socialist values to technological change. I am never in favour of looking backwards, but the welding I very much support.

Many of the attendees wanted to know what we were doing in the UK to help end austerity economics and the marginalisation of the state. They said to me that what happens in the UK tends to come afterwards to Canada – one of their greatest fears was that academisation would be transplanted. The Canadian teaching union has the richest pension plan in the world – currently it owns High Speed One railway and Camelot, the operator of the National Lottery. That would not be possible under an atomised, fragmented school system, yet another argument to add to all the ones we already know. I reassured them that we were fighting forced-academisation all the way.

What I took away from the summit was the need for progressive parties to run as progressive parties and take on the big issues with big narratives. Now with the fight against academisation, the Panama Papers and our new Economic Advisory Committee, we are beginning to do that.

But the summit also benefited from representing a broad diversity of voices on the left, rather than different centre-left strands talking within their own echo chamber as can sometimes seem the case here. In the past few months Momentum, Labour Together and Labour for the Common Good have been added to groups such as Progress, Class and the Fabians. Wouldn’t it be great to have a forum where they all came together? Or is that the Labour Party?