How does Labour get its economic message across?

by Jonathan Todd

“The last Labour government,” The Times front page last Friday reported Ed Balls as saying, “didn’t regulate the financial services in a tough enough way.” They reported this as “the closest to an acknowledgement of personal responsibility” for the 2008 financial crisis. Yet, given that Balls has said similar things in the past and is silent on whether the last government spent too much, it seems a relatively mild contrition.

Apparently, there are a range of views within the party as to how Labour should address a central Tory attack: “Why hand the keys back to the guy who crashed the car?” “Senior figures close to Tony Blair have been urging a more aggressive rebuttal”, The Times report. “Ed Miliband’s allies want to focus voters’ attention on the future.”

If Blair is advocating an aggressive rebuttal, I imagine he means on behalf of the 1997 to 2007 government, rather than the Gordon Brown administration. It’s a stretch to imagine Balls running on a “Tony was right, Gordon was wrong” campaign.

The debate over how Labour wins the economic argument was also considered in the book that Uncut launched at party conference. “We might change the conversation,” I wrote, “in which the Tories present us as addicted to spending by changing what people think of our past (“It was the banks, not us”) or what people think we think about our past (“It was partly us but we’ve learned our lesson”) or what people think about our future (“Here’s why it will be different next time”).”

Thus, Balls seems to want to say “It was partly us but we’ve learned our lesson”, while Miliband appears to want to argue “Here’s why it will be different next time”. In these terms, the approach advocated by Uncut is closest to that of Milband. “Because there is a limit to how much repositioning Labour can credibly make this side of the general election, we focus on the future.”

In the future that Uncut looked toward, Labour convinces the public to return to us the car keys by identifying £34bn of additional cuts in 2015/16, which overcomes the Tory charge that we are profligate, creates resources to reallocate to Labour priorities, and fundamentally recasts the political conversation.

Since Uncut published our book, however, George Osborne has changed the game. He’s done this by extending the debate about fiscal policy well beyond 2015/16 to 2018/19. In the baseline set by Osborne, we’ll be running a budget surplus in 2018/19. The Balls comments reported by The Times were concerned with financial regulation. As crucial as that is, the real battle is concerned with how Labour responds to Osborne’s fiscal baseline, rather than how a future Labour government would interact with the banks.

Balls has rejected Osborne’s baseline by committing to doing less fiscal consolidation over a longer time horizon. He wants to bring current spending – not the overall budget – into surplus by the end of the next parliament, one year later than 2018/19. In the current Progress magazine, I analyse how he might achieve this goal.

In a vital sense, though, this analysis for Progress is misconceived. It focuses on how to secure an outcome – surplus in current spending by 2020. Yet, as Siôn Simon wrote on Uncut early in this parliament, “we are in opposition now, where it is messages that count, not outcomes”. Consequently, thinking through exactly how we’d balance current spending by 2020 is less important than successfully sending the message that we can again by trusted with the keys to public spending.

It may be that Miliband is right that this is best done by talking about the future. But in talking about the future, we must address the concerns that people have about Labour, which have their origin in the past. We must, therefore, send messages about the future that succeed in communicating how it can be better and fairer, while also being affordable and achievable.

By giving a speech on Agenda 2030, it’s clear that Chuka Umunna wants to make a forward-looking pitch to the electorate. “Reducing the deficit,” he claimed in this speech, “is neither the only economic challenge we face, nor – in the longer term – the most important.”

As Osborne stretched the political focus from 2015/16 to 2018/19, Umunna wants to shift it further, all the way to 2030. He’s right that the deficit is not the most important economic challenge that we face over this horizon. But Labour’s victory in 1997 wasn’t based on talking about where we’d be in 2012.

In the long run, we are all dead, as Keynes famously observed. It’s not just business that has a bias to the near-term. Politics does too. Irrespective of what the UK should seek to do by 2030, the near-term political imperative for Labour remains sending the message that Labour is not an unaffordable risk.

If Uncut, literally pub drinkers, can identify £34bn of additional cuts that could be made in 2015/16, surely Labour’s combined brains can find means of sending this message?

Jonathan Todd is Deputy Editor of Labour Uncut  


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5 Responses to “How does Labour get its economic message across?”

  1. Robert says:

    Unfortunately, getting the deficit back to a sustainable level will be the most important task of the government during the next Parliament and, quite rightly, Labour has said that it will do this at a slower pace than Osborne is planning. The importance of reducing the deficit does not mean, however, that public spending caused the financial crisis and the deficit has actually kept the economy going for several years.

  2. Fred says:

    The central pillars of the Labour message are spending the bankers bonus over and over again.

    a Jobs guarantee that is just another gimmick.

    The key issue Jonathan is real growth. Growth gives you jobs and a future. The Tories will highlight how on average business would rather a trained chimpanzee running the countries finances than Labour and Balls. This is a fact, this is what derailed Kinnock and it will happen again..

  3. @Fred: if the real issue is growth then George Osborne’s record is hardly a glowing recommendation! If the issue is growth then the government should have focused more on stimulus and less on fiscal contraction. A jobs guarantee may be just a gimmick, but it is a policy predicated on giving young people a chance to get paid employment that will give them confidence, skills and experience. A gimmick, therefore, that is focused on real people.

  4. Fred says:

    Robin, you make me laugh, you clearly show why Labour is never to be trusted. With tribal labour its more about your religion and sacred beliefs than reality.

    Whenever you’re asked a question you blow hard about the pesky Toreez. We’re in this mess because of inefficient government spending, but you lefties can’t help yourself.You hate the people that start companies, you hate the very vehicle that creates jobs.

    Tell you what Robin, why don’t you start a company and employ a couple of thousand people on the living wage? Is it because you don’t understand business and the real world? The real truth is that the the Labour left is incompatible with the realities of global capitalism.

  5. Fred says:

    Atul, who’s on moderation today? Somebody who struggles with needing to counter harsh statements?

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