by Sam Fowles
Ed Miliband’s “party of work” rhetoric may have stuck an important blow in the battle with the Conservatives but he’s lost a march in the war.
At first glance last weeks economic policy speeches from the Eds (Balls and Miliband) set out sensible policy and may even go some way to helping Labour win back our lost “credibility” on the economy. But only at first glance. While the desire to remove Cameron and co from office at the earliest possible opportunity (and by any means short of a military coup) is understandable, it’s mistaken. Miliband’s speech was an attempt to gain economic credibility on Tory terms. And, as any good general knows, you never fight a war on the ground your enemy chooses. Ask anyone who’s invaded Russia.
By buying into the Conservative’s narrative Miliband risks creating a situation where economic credibility only ever means one thing. And, worse, leaving the Conservatives to decide what that thing is. He’s surrendered control of the narrative and that is political suicide, perhaps not for himself, but certainly for his party.
This Conservative party has pursued two distinct and important narratives.
The first is that economic credibility means cutting in the short term. It doesn’t matter that this policy has actually failed in its stated goal of bringing down the deficit, what matters is the electorate believes that cuts = responsibility.
The second narrative is a classic tale of the “internal enemy”. In this case there are two: the unemployed and immigrants. Again, it doesn’t matter if either of these actually are a threat to the “hard working people of Britain”. What matters is that the electorate believes they are and thus turns to their friendly neighborhood Tories for protection. Putting immigrants aside for the moment (and how I wish the press would), by trailing their economic policy by telling us what they’d cut and defining themselves against those “who refuse to work” the Eds have indirectly bolstered both of those Tory narratives.
And the thing about a Tory narrative is: it’s always going to make the Tories look best.
Allowing one side of the political spectrum to dominate the narrative means the political debate becomes about perception rather than truth. Margaret Thatcher is talked of as a model of fiscal responsibility by both the left and right. Yet she squandered billions in North Sea oil revenues on a short term tax cut rather than securing the long term economic strength of the country by investing it.
Why is she not ridiculed for so dramatically putting ideology before country? Because her party told us that cutting spending equals fiscal responsibility and she cut spending. Then they kept telling us the same thing in the face of all contrary evidence and eventually Labour stopped arguing.
The internal enemy narrative is a classic ploy for right wing parties. When we feel threatened by forces within our own community we look to protect ourselves and our families in the short term and thus turn to conservative parties.
When a nation is united we are much more likely to be in the mood to help our fellow man by engaging in projects to build a fairer society and so are more likely to vote for left wing parties. Britain is no different. In the 1930s we turned to the right because we were scared of the communists. In the 1980s it was the unions and now it’s the unemployed. Whether any of these actually are a threat is irrelevant. The Conservatives made us believe they were (Zinoviev letter anyone?) and so we all freaked out and voted Tory.
By contrast, the Obama campaign went out of its way to rebut Republican attempts to control the narrative. In response to the “fiscally responsible governments cut” narrative, they showed us a Detroit saved by government investment and children healed by Obamacare. In response to the smorgasbord of internal enemies served up by (increasingly swivel eyed) GOP hopefuls, they embraced minorities by supporting gay marriage and immigration reform.
Most importantly, Obama refused to accept Republican attempts to turn the federal government itself into the enemy. One of the key strategic turning points in the 2012 campaign was the president’s decision to focus on the vital role the government plays in stimulating private enterprise (“you didn’t build that”). While Obama may have undone much of that good work when he decided it was totally cool to read everyone’s emails, at the time OFA made the American right look like the recalcitrant fundamentalists they surely are.
Labour must do the same to the Tories. Ed Miliband should tell the country that the Conservatives are the last people with a right to define economic credibility because, of the last three recessions, they’ve caused or worsened every one (usually because they just implement the same policy every time…). By contrast, Labour had actually got the economy growing before they lost office in 2010.
Even more importantly, we should all stand up and say that demonising immigrants and the jobless has nothing to do with “fairness” or “contributing” and everything to do with the fact that the Tories just don’t like foreigners or poor people.
Most of all, Labour absolutely must not accept the Conservative narrative by saying that we will “regain” economic credibility by cutting (albeit more competently) and punishing those out of work. It won’t fix the country and, in the long run, it will mean Labour must compete to fit a Conservative model of good governance when we should be defining it in our own image.
Sam Fowles is a researcher in International Law and Politics at Queen Mary, University of London
Tags: Ed Balls, Ed Miliband, immigration, political narrative, Sam Fowles, spending review 2013, the enemy within, welfare
It doesn’t matter that this policy has actually failed in its stated goal of bringing down the deficit,
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Except the deficit has come down. From 150 bn a year to 120 bn a year.
Or are you confusing debt and deficit. Standard con that one.
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In this case there are two: the unemployed and immigrants. Again, it doesn’t matter if either of these actually are a threat to the “hard working people of Britain”
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Why doesn’t it matter?
Unemployed is one thing. Living off welfare a la Skint is the problem.
On migration, its a major issue.
1. Low skilled migrants do not pay enough taxes to cover the costs of having them here.
2. Low skilled migrants compete against the unemployed.
3. That lowers wages.
4. The raise the need for housing, driving people into more cramped conditions [Along with those who want two spare bedrooms]
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Investment
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Investments either produce an income, or they produce savings (cuts). The income and the savings have to exceed the borrowing cost.
So what investments did Labour make, and how are they panning out now? What income and what cuts have resulted.
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Debts
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Why no mention of the pension debts? Under Labour, 2005-2010, the pensions debts went up by 734 bn a year. Current taxes only raise 600 bn a year.
In other words, it was all an illusion, bought by spending people’s retirement cash.
Hi Nick
Re debt/deficits
Got to hold my hands up on this one. Made the mistake of using “deficit” colloquially rather than as an economics term. I was indeed referring to the national debt, which has risen under this government (I believe it now stands at £1.16 trillion, up from £ 0. 76 tril when this government took power). Incidentally, from an economics perspective, the figure to watch out for is the difference between debt and GDP. If GDP is rising then debt becomes easier to pay off because it represents a smaller proportion of the government’s intake . As such this government’s central economic mistake is to pursue paying down the debt before growth (incidentally the same mistake that the MacDonald and Baldwin governments made in the 1930s). The quickest way to pay down the debt is with increased growth. Ironically, while government austerity (pursued with the aim of paying down the debt) has the effect of suppressing demand, they will only ever see limited success in paying down the debt. This was the mistake made in the 1930s (it took the massive spending of the Second World War to stimulate demand) and it’s the mistake they’re making again now. This was essentially the rationale for my claim that “cuts equals fiscal responsibility” is a false narrative but (as evidenced by it’s repeated resurrection from, what I should suggest, is the well deserved grave of history) one that is nonetheless compelling.
Here’s a link to the facts as they currently stand: http://www.ukpublicspending.co.uk/uk_national_debt_chart.html
Re your point on immigrants and welfare:
It doesn’t matter because the impact of immigrants and the unemployed/skivers/feckless/insert whichever term the Daily Mail is using this week is both economically and morally insignificant.
It’s economically insignificant because the total amount spent on Jobseekers Allowance is £4.9 bn, the total spend on all benefits (including housing benefit, child support etc) amounts to £84.8bn. While this seems like a large number, let me put it in context: The government is currently prepared to accept a £17bn loss for the sell off of RBS and Lloyds. Or if you prefer; Individual tax avoidance costs the economy £100bn per year (that’s not including corporate tax avoidance – the likes of Google etc). Compared to numbers like these, which both have, if not simple then eminently achievable, fixes. The economic “threat” from the unemployed pales into insignificance.
It’s morally insignificant because people are largely not unemployed because they are lazy. People are unemployed because there are not enough jobs. With an average of 10 applicants for even the worst paid jobs, one needs to be more than simply a “striver” to get employed. Therefore for every “single mum with eighty one kids and a horse living in Fulham that the tabloids dig up, there are literally hundreds of people who are desperate for jobs that just don’t exist. The situation isn’t helped by this government’s “get people into work” policies (those which involve requiring unpaid “work experience” in Tesco and Poundland in return for benefits) because, while these companies can have the unemployed work for them for free, what incentive is there to hire new staff?
As for migrants, any economist will tell you that migrants as a whole make a net positive contribution the UK economy. Your statistic re unskilled migrants may be accurate but it’s really a case of manipulating the numbers. Leaving aside for a moment the fact that this government’s immigration policies have made it harder for skilled migrants and students to enter the country (both of these groups make a massive contribution to the economy – I speak as one who’s undergraduate education was largely paid for by rich Americans who missed out on getting into Princeton), carving out the section of immigrants who may not make a net contribution is like saying “four minus two equals one (but only if I take another one away as well)”, it’s choosing the figures that support your argument at the expense of the bigger (and more accurate) picture.
As a result of art. 45 TFEU (concerning the free movement of workers), we can’t discriminate between skilled and unskilled migrants from the EU (where most unskilled migrants come from). So we either accept all immigrants from the EU or leave the EU (a WHOLE different debate). But migrants are no different from any other section of society in that some make a positive economic contribution and others don’t. But as a whole, immigrants make a net positive contribution so they pose no more threat than any other section of society.
Here’s some useful websites on this (one of them’s from The Telegraph – I’m just straddling the political divide here tonight, Clinton would be proud…)
http://www.guardian.co.uk/news/datablog/2013/jan/08/uk-benefit-welfare-spending#zoomed-picture
http://www.guardian.co.uk/news/datablog/2013/jan/08/uk-benefit-welfare-spending#zoomed-picture
http://www.telegraph.co.uk/finance/personalfinance/consumertips/tax/10071507/100bn-lost-in-tax-avoidance-by-individuals-Oxfam.html
Re investments
First, I wasn’t talking about investments from borrowing. The Thatcher government had a windfall from North Sea oil that they should have invested but chose to spend on a short term tax cut. In doing so they put electoral success ahead of the long term fiscal interests of the nation. This is all covered in the article I linked to in my original post so check that out. Borrowing costs are irrelevant in this case because the money wasn’t borrowed.
As for what investments the Blair/Brown governments made. They didn’t. But then they also didn’t have the same North Sea oil windfall as the Thatcher government. They did have a long period of continuous economic growth and I would suggest that it was a mistake not to invest some of this or at least use it to pay down debt. But they were never in the same position as the Thatcher government was with North Sea Oil.
So the last Labour government didn’t invest either, but the fact that both parties made the same mistake doesn’t make it any less of a mistake. What matters is who is now prepared to admit it was a mistake (and sort of the whole point of my post was that neither party has done so and this is a really bad thing etc etc).
Aaaaaaand finally:
Re pensions.
It’s unsurprising that the pensions debt went up between 2005 and 2010 because this was when the baby boomer generation started to retire. It has less to do with “spending other people’s retirement cash” and more to do with more people retiring and fewer people in the workforce to pay for them to do so.
Indecently, the pension system works by the current working generation paying for the generation retiring. The money you pay in state pension contributions isn’t put in a little pile on it’s own in the Treasury waiting for the day you turn 65, it’s spent on paying your gran her pension. So the idea that the nefarious Labour government spent the retirement cash that previous government’s had conscientiously put aside for the baby boomers is emotively effective but wrong. However, credit to you for bringing to light another example of a successful Conservative political narrative.
Which is really the wider point. My post wasn’t about pensions, it wasn’t even a critique of current or past Tory policy (to be honest I sort of thought the readership of LABOUR UNCUT would take that as read…). It was about how the right has been successful in developing and controlling a political narrative and how Miliband made a mistake in buying into that narrative.
The very fact that we’ve been able to have this debate shows that narratives are not based on facts, they’re based on interpretations of facts. My point was that if you accept the other side’s methodology of interpreting the facts as the only methodology possible then you’re always going to lose the debate. As a great man once said – “reject the premise of the question!” (alright, it was Leo McGarry in “The West Wing”, but he had a point.)
However, in the light of your comment I’ll try and pick something more policyish for next time that you can really get your teeth into!
For the last 3 years the Tories have Been saying you can’t buy your way out of a recession to which we’ve been saying yes you can ,now w e admit you can’t, but doesn’t that contradict what we’ve been saying for the last4 yrs.
Insightful and knowledgable stuff. I agree with gist of what you are saying and thanks for taking the time to expand in the comments.
I also agree with John that a perceived change in attitude damages the Labour argument against cuts; but the Eds are trying to be pragmatic and do what is practicable.
Spending plans have to be justified and quantified. But as you rightly point out even the entire benefit bill is dwarfed by tax avoidance.
This point has been made before.
The two Ed’s couldn’t frame a picture far less a debate.
Immigration:
http://www.dailymail.co.uk/news/article-2324112/Lord-Mandelson-Immigrants-We-sent-search-parties-hard-Britons-work.html
“Immigrants? We sent out search parties to get them to come… and made it hard for Britons to get work, says Mandelson”
http://www.express.co.uk/news/uk/400239/Labour-s-open-door-policy-let-in-more-immigrants-in-a-decade-than-the-previous-40-years
“More European immigrants arrived in Britain in the past decade than the previous forty years.”
http://www.timeshighereducation.co.uk/news/labour-open-to-rekindling-targets-for-overseas-student-growth/2004667.article
“At the launch, Mr Umunna was asked by Vivienne Stern, Universities UK’s head of political affairs, whether a future Labour government would consider reviving the Prime Minister’s Initiative launched under Tony Blair which set “a clear numerical target for growth in international student numbers”.”
““I’m certainly open to that and will talk to Yvette Cooper”
The simple fact is the public does not wish to continue the large scale immigration (13% of the population). And this is not just an economic issue, but a social and cultural issue.
Its no contradiction at all. There is no ‘right’ or ‘wrong’ policy on economic recovery. Does anyone apart from Party nerds think that the general public actually understand the arguments for or against? Its a matter of time. Either policy will in fact work, just as well,; perhaps a combination of both will work even better. The Public are not on the same wavelength as the experts; they simply cannot understand what the experts and political commentators are saying on this matter. And the public have very selective memories; they always think the ‘past’ were the good old days if conservatives, and if socialists, the past was the bad old days. The truth is the past was neither, or both. So changing our narrative may well be regarded as admitting to reality, or it might be regarded as a sell out.
Thatcher and oil revenues….she and her successors did spend some of the revenues on infrastructure projects – Thames Barrier, M25, seed money for the Channel Tunnel, extending the Jubilee and various other projects that benefited the whole country from Watford in the North to Guildford in the South.
Labour went into the last election promising to halve the deficit with Alistair Darling clearly saying that the cuts he’d implement may be tougher than Thatcher’s. And he won credibility over it. It’s not a fight about Tory cuts versus Labour investment, it’s about the deficit and how to cut it. We should be saying that the Tories were wrong to cut spending when the recovery was weak. Anyway, there will probably be enough growth come 2015 to withstand spending cuts without tipping the economy into recession.
Renie, it’s true Alistair Darling did promise that, and we’re promising uts now, the difference is that we were opposing cuts 2010-2013
Yes Labour is letting ConDems privatise the state. Due to Failing Grayling, very soon an individual will be able to be investigated by G4S police staff, prosecuted by a G4S prosecutor (without access to legal aid), in a G4S Court, then taken in a G4S security van to a G4S prison, to be locked in by poorly paid G4S Prison Officers and rehabilitated and mismanaged on release by unskilled G4S Probation Officers (probably while restricted from welfare or creamed and parked on an A4E work programme). This is madness and nothing to do with savings or justice. We need to stop this man before we have no Justice system left.
Have you seen our petition? Do not privatise the Probation Service