Labour will only win the economic argument when we make it about the future, not the past

by Jonathan Todd

The return of the British economy to growth and president Obama to the White House both suggest that Labour will only decisively win the economic argument when it is primarily about the future, not the past.

While welcoming the economy’s recovery, Labour claims output has been foregone due to the government cutting too far, too fast. This frames the economic debate as being about faulty decisions of autumn 2010 by George Osborne and their consequences over the next two years. As much as the celebrated speech of Ed Balls at Bloomberg in August 2010 is vindicated by events over this period, framing the debate in this way invites the question: Why was the government’s fiscal consolidation programme deemed necessary?

Of course, Osborne then cites the reckless profligacy of Labour. Equally obviously, we contend that this programme was unnecessary and the cause of the recession “made in Downing Street”. What may be less apparent is that, no matter how intellectually justified the Bloomberg speech, arguing about past decisions asks the public to reconsider events over which they have a settled mind.

They would have voted differently at the last election were they convinced that Labour had credible and effective plans for public spending. Especially given the pain that government spending decisions have since brought, it is understandable that we find it difficult to concede this. But a strategy for winning the next election predicated upon the electorate reversing a verdict given at the last election rarely works.

This does not require self-flagellation over spending or any dilution of our insistence that the government have cut too far and too fast. We do need to recognise, however, that we are not trusted on spending, as was the clear verdict of the last general election. This has two consequences for Labour:

First, we should attack government policies for their failure to realise the future potential of the economy, not in terms of what they have cost us since May 2010, as this sucks us into a backward looking argument that we lost in May 2010.

Second, we should offer alternative policies to better secure the future potential of the economy, which are demonstrably affordable. Labour policy that fails this test reinforces our key vulnerability of perceived fiscal vandalism. We can also seem to communicate the flawed idea that all government spending – even on millions of paperclips – helps growth. We need to be more fluent in arguing that the content of government spending is as vital as the level.

We make it, in other words, an argument about the future – a future that not only works but which is convincing to a people who have dismissed Labour as dangerous spendaholics. As challengers we have to say at the next election: “It is time for a change”. But we must be a believable change.

In contrast, David Cameron, like Barack Obama, will ask: “Let me finish the job”. Cameron will take reassurance from Obama for three reasons.

First, incumbents can win. Many have not amid the turbulence of recent years.

Second, aggressively targeting the challenger’s weaknesses works. We only have to look at Conservative literature in Corby to see what they think Labour’s weaknesses are. It might as well say “Labour’s spending bombshell”, as they said “Labour’s tax bombshell” in 1990s. Tax was then the millstone around our neck, overcome in 1997 by high profile commitments on tax having been one heave too far in 1992.

Third, victory can be secured if the country feels itself to be travelling in the right direction, even if the destination awaits. Obama came to office amid calamity and spectacular job losses. He did not deliver an economic nirvana but he asked for re-election in changed circumstances: a growing economy, which hires 120,000 new workers every month.

America tentatively thinks it is going in the right direction, which was enough for Obama, especially as he so comprehensively undermined the credentials of his opponent.

Will Britain think Cameron has taken us in the right direction at the next election? And will he be able to humble Ed Miliband as Obama did Mitt Romney?

The latter depends upon how big a target Miliband gives Cameron to hit. And the Corby literature indicates Cameron thinks he is throwing punches at a glass jaw by going after Labour as unreconstructed on spending.

Any number of factors impacts the former but two broad scenarios might be identified:

First, recovery suffers due to events beyond the control of Cameron – America drives off the fiscal cliff, the Euro implodes. In these circumstances, the public would accept Cameron’s argument that the economic predicament is not his fault.

Second, the light at the end of the tunnel becomes more visible. It is as foolish to proclaim an end to boom and bust at the bottom of the cycle as it was at the height of the new Labour boom. This scenario sustains cautious optimism and is likely to reward Cameron.

Either Cameron will have excuses or some success to point towards – a move in the right direction, if not a terminus of great prosperity. In neither of these worlds would Labour really be rewarded for revisiting past arguments. Instead we should do a better job than Romney of neutralising our weaknesses and convincingly arguing for a better future.

Romney is now a footnote to history. Balls and Miliband can be more than that but not if they rest on the deserved laurels of the Bloomberg speech.

Jonathan Todd is Labour Uncut’s economic columnist

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4 Responses to “Labour will only win the economic argument when we make it about the future, not the past”

  1. swatantra says:

    This is the greatest danger for Labour: All Dave has to say in 2015 is : Give me the tools and I’ll finish the job: the tools being a wacking Tory majority: and once he’s got that his rednecks will be off the leash. Labour should be hoping for another hung Parliament, so that it is the largest Party ( there is no way that it’ll achieve a majority this time round).

  2. Chris says:

    You may be right in your assertions but I have yet to hear anyone in the Labour Party admit any responsibility for the failure to balance the book whilst in power. Balls has resorted to lying about his record. Brown cant be arsed to even turn up in the commons and represent his constituents. 2+ years into this Parliamnet and the blank page of Labours policy review is still, er, blank. The cutting too far too fast line doesn’t work when spending and borrowing are still increasing.

  3. uglyfatbloke says:

    I’m afraid you are both right. Without some cataclysmic change Cameron is going to be able to say things are getting better (or at least ‘less bad’) and as long as Balls is the shadow chancellor Labour will be vulnerable because he Tories just have to point at him and say ‘useless before..dodgy now…why give him another chance?’
    It’s hard to see Ed Miliband making the kind of gains necessary to form a majority government, especially since Labour stands to lose a bucket of seats in Scotland. Equally, the Glib-Dumbs will probably not be in a position to help. If they are lucky they will get 20 seats in England and Wales. They can only hope for two in Scotland -even that depends on Campbell standing again. Carmichael is safe (he’s very popular locally, seen as a decent sort of person and is, essentially, a closet gnat) but the others will all be out on their arses.
    Will Cameron win outright ? I doubt it, but he may well get to form a minority government.

  4. MickleMas says:

    What a load of balls! The attitude that Labour should a) admit it made fundamental economic errors whilst in government, b) apologise in trumps (sackcloth and ashes and much self-flagellation etc.) for being responsible for leaving historic debts (and heaping all the blame on Gordon Brown), and c) assuming Tory policies will be so disastrous as to gift Labour victory in 2015, demonstrates an ignorance of voters’ thinking. The most important word you mention (and gloss over) is PERCEPTION.
    Like “Chris” (Nov 13), a proportion of the electorate wrongly assume that our presentday economic woes are a direct consequence of the policies of Brown and Balls. It is a false perception.
    It is crucial to acknowledge that ‘public perception’ rarely equates to truth. Public perception is largely manipulated by the Press and TV news media. What they claim as the truth is usually accepted by the public (though we should recognise that the news media are politically biased and will distort the facts to suit their ‘presentational values’). When several news broadcasters present similar reports on particular subjects most of the public will be led to accepting the consensus media view, alla, ‘there’s no smoke without fire’ and ‘I agree with most people’. It is the ‘herd instinct’ rule that the media are expert at exploiting.
    I could give countless examples of the media (95% pro Tory) misrepresenting the truth to fit in with their political bias (just watch Paxman or Marr etc.) but let me give you two examples. You may remember the furore a decade ago about the merits or otherwise of the MMR vaccine given to children. Despite the totally overwhelming expert medical advice that MMR was safe most of the media (led by the BBC) chose to highlight and promote the discredited views of ONE medic. The result of this negative publicity was a sharp decline in public take-up of the MMR vaccine which has consequently led to dangerous outbreaks of life-threatening measles.
    My second piece of evidence lies in the near future. On 15 Nov the good citizens of Corby will be voting to elect a new MP. Clearly, a certain % of the electorate will vote on party loyality lines but perhaps the majority of people will cast their votes according to their “perceived truths” of the parties/candidates and how they received these “truths” is crucial to the outcome. What will be the outcome? I suspect the 40% of voters who bother to turn out will be mainly ‘pro a party other than Tory’ but at the same time ‘reticent to vote for Labour with a perceived weakness for economic governance. In other words, Corby is a Tory constituency to lose rather than one to win for Labour – though they probably will win it, just.
    The point is: perception always overrides truth. It is the duty of Labour to win support by changing ‘perception’ – so stop being so pathetic/apologetic/submissive/deferential etc. when appearing on “The Daily Politics” or “Newsnight” etc.

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