Archive for March, 2015

Is socialism still at the heart of the Labour party?

31/03/2015, 07:23:18 PM

by Daniel Charleston-Downes

Just before the Labour party conference in 2013 Ed Miliband was asked when he was going to put socialism back on the agenda of the Labour Party. ‘That’s what we’re doing sir’ was his reply. As we approach the election he has again been asked to defend his record as ‘Red Ed’, being told that the party was still not left wing enough for one supporter. The party is plenty radical enough for Mr Cameron however who described the entire party as a ‘bunch of hypocritical, holier-than-thou, hopeless, sneering socialists’.

To some extent you can ignore Cameron’s quote as an uncharacteristically desperate and overt personal attack on Miliband in response to a surprise poll bump for his party. But there are growing voices in the party, especially when faced with having to defend austerity measures, that are dusting off their berets and bringing their Marxism out of retirement. Already within the Labour party you have Labour Left and Red Labour to name just some factions that draft policy and put pressure on the party to move left. Some of those that feel that the cause is already lost have defected to the Greens or more recently Left Unity.

Labour is still, in at least name, a social democratic party and is affiliated with socialist groups in Europe and the wider international community. Socialism in Britain has always been a little different to its European brother with a tendency to venerate the Lords and the Queen and have a deep respect and even spiritual relationship with the Church. Traditionally, Labour’s greatest and most radical socialists have come from the middle to upper classes, take Tony Benn and Clement Attlee as examples. The Labour party, since it became a large-scale political party, hasn’t always sat easy with the working classes as a true movement for the masses.

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It is time to put some humanity back in the Treasury

31/03/2015, 03:20:44 PM

by Rajesh Agrawal

It is wrong for commentators to lazily blame Labour for the economic downturn and credit the Tories with the recovery.

The truth is, the recession wasn’t caused by Labour. It was the result of a serious collapse in the global banking system.

After five years of Conservative spin you might be forgiven for forgetting that Labour’s economic record in power was actually one of remarkable stability and sustained growth for the ten years before the banking crash. It was also a time when the vast majority of ordinary people felt the benefits of economic prosperity.

Far from irresponsible spending, Labour biggest deficit before the crash was 3.3% of GDP. Osborne’s currently stands at 4.6%.

In fact, Labour successful and responsible economic management was arguably the single biggest reason the Conservatives found it so difficult to win back power in 2001, 2005 and a majority in 2010.

By comparison, Osborne’s economic record is hardly a shining success story he claims.

The current recovery is the slowest economic recovery in over a hundred years. It is also an unbalanced recovery with huge areas of the UK and millions of ordinary people yet to feel the benefits, while the gap between rich and poor gets ever wider.

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The Tories want to park the bus. But the wheels are falling off

30/03/2015, 09:00:30 AM

by Jonathan Todd

This was the week that the supposed Long Term Economic Plan (LTEP) gave way to short term miscalculation. The question is whether it will have a resonance deep enough to reach beyond the narrow cadre of the politically obsessed and long enough to be felt on 7 May.

It was a good week for Labour. And there are precious few weeks left before the election. The Tory plan was to stuff them full of LTEP. Park a bus of LTEP on the playing field of the election and close off all Labour routes to goal. Lynton Crosby as José Mourinho. But the wheels have looked like they are falling off the Tory bus.

“You had one job,” Crosby must ruefully lament. Instead of LTEP, Cameron needlessly diminished himself by triggering speculation about the Tory leadership and increased agitation among the runners and riders to focus on positioning in this race. It’s akin to John Terry tossing aside mid-match the armband that denotes the Chelsea captain.

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Uncut review: “Blair Inc: The man behind the mask” by Francis Beckett, David Hencke and Nick Kochan

26/03/2015, 05:14:24 PM

by Chris Ricôt

No sooner had I left the bookshop than the sales assistant ran after me. “I’m sorry, sir, but I wasn’t actually allowed to sell you that book.” What was going on? “It’s embargoed. Apparently the release date’s been pushed back. It’s being serialised in a weekend newspaper.”

No prizes for guessing which. This book is hysterical in its condemnation of Blair. Page after page of wild estimates about personal fortunes, consultancy fees and property portfolios go beyond the polemic. It’s a double-page spread of tabloid anti-Blairism extrapolated over 370-odd pages. A quick look at the sources at the back list a tangle of websites that alternate between Mail Online and the Telegraph. Serious journalism this ain’t.

The authors aren’t sure if Blair is callow, cynical or both. Their story begins on 27 June 2007, the day Blair resigned as prime minister. As soon as he was appointed Middle East peace envoy, Blair ‘set about making himself seriously rich.’ The distaste for Blair’s “excellent state pension,” “twenty-four hour security team” and “increasing web of relations” (whatever that’s meant to mean) is established right from the outset. The authors are baffled that those “who still support him do so with greater intensity than ever before.”

The book peddles the myth that Blair didn’t achieve much in office, when his supporters remember how he fundamentally transformed our country. It’s not just Northern Ireland and the national minimum wage: it’s Sure Start. Civil partnerships. Paternity leave. Devolution.  A reference to Sierra Leone’s civil war is dismissed as  “his most (and only) successful foreign intervention.” What  about Kosovo?

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Horse-trading in Halifax

25/03/2015, 09:55:41 PM

by Rob Marchant

Union money: “the cleanest in politics”, as some Labourites describe it, misty-eyed. To be fair, sometimes it is. There are decent unions who donate money because they actually want a Labour government. On the other hand, the cliché is that business donations always come with strings attached.

Let’s decide which of the two the following is.

Exhibit A: the Halifax selection, where Len McCluskey’s friend Karie Murphy was working hard, with the backing of the considerable weight of Britain’s largest union, to be its MP. The Sunday Times (£) wrote a couple of weeks ago that her place on the shortlist was being horse-traded for a previously-pledged donation of £1.5m to Labour’s election fund. Surely not?

After her failure to be shortlisted by the party’s Special Selections Panel, there were two possible outcomes: that Unite’s donation would then be delivered, and that it would not be delivered. Naturally, the outcome couldn’t possibly related to the Halifax selection. We’re talking about the cleanest money in politics, after all.

Oddly, the Telegraph reported last week that “a senior Unite figure said the union could withhold any further funding for final two months of the campaign and demand Miss Murphy is allowed to run for another seat this election.”

It is also important to note that Labour is perfectly entitled – and always has been – to select shortlists close to an election. The party has never pretended that this first stage is democratic – it can’t afford to be, when you only have weeks to establish a candidate and try to win – it is only afterwards that the local party gets to choose from the shortlisted candidates.

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David Cameron has made a massive mistake but Labour’s picked the wrong line of attack

24/03/2015, 08:50:59 AM

by Atul Hatwal

If the Conservatives win the next election, David Cameron has turned himself into a bystander in his next government.

By pre-announcing his resignation he’s dissolved his future authority with backbenchers, who will be more interested in winning the favour of the next leader, and shifted the media lens onto his potential successors. The question of when he will resign – because he surely won’t last a full term – will dog him each day and ultimately he will struggle for relevance. He’s condemned himself to a living political death.

In the wake of such an extraordinary unforced error, Labour’s chosen line of attack is that Cameron is taking the electorate for granted by assuming he will win the next election. It fits with Labour’s broader critique of him and in that sense is logical, but it’s also wrong.

Two of David Cameron’s greatest political assets are his double digit lead over Ed Miliband as the public’s preference for PM and the extent to which he personally outpolls his party.

David Cameron’s telegraphed resignation is the very antithesis of leadership; it’s the epitome of weakness and raises the likelihood that any one of a gaggle of unappealing Tories could be prime minister in the next Parliament. Suddenly, there might be some hope for Labour.

Instead of talking about arrogance, Labour should be recasting the leadership choice at this election as one between Ed Miliband and the dangerous unknown.

There are two aspects to this.

First, the message should be hammered home that David Cameron is about to quit on the British people in the next Parliament.

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Revealed: George Osborne’s secret £6.5bn tax raid on pensioners

20/03/2015, 11:17:26 AM

by Samuel Dale

Buried deep in this year’s dull Budget was a secret £6.5bn tax raid on pensioners and savers under the guise of radical reforms.

George Osborne’s most significant policy announcement was the proposal to allow pensioners already drawing an annuity to sell their policy in exchange for a lump sum.

It is the second stage in major pensions reform announced in last year’s Budget to allow all over-55s to access their pension pots.

The first stage of pension freedoms is relatively simple. The pension system saw savers build up a retirement pot of cash with generous tax relief on contributions. In exchange they had to buy a secure income or annuity (or face a punitive 55% tax if they withdrew their cash from the pension wrapper).

Annuities work as a reverse insurance product so you pay over a big chuck of cash to the insurer and in return they pay you money every month until you die. Insurers pool the risk so those who die earlier fund the payments for those who live longer than expected lives.

As people live longer insurers are paying a lower amount each month over a longer period, making pensioners buying them poorer. Successive Governments have taken steps to ease the requirement to buy an annuity by allowing wealthier investors to drawdown their own money.

But Osborne’s announcement last year, coming into force on 6 April, is the big bang. It means anyone can withdraw their pension pot at marginal income tax rates (although everyone receives an initial tax-free lump sum of 25%).

The Treasury estimates the behavioural changes will see individuals wanting the money today despite the tax penalties. It will lead to many savers paying income tax on withdrawals they have never paid before.

So how much does it cost?

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Budget 2015: The quiet moments matter

19/03/2015, 02:27:16 PM

by Jonathan Todd

Budgets are supposed to be big moments. The kind that determine general elections. But maybe they are decided by millions upon millions of quieter moments. When payslips are inspected, profits turned, and housing wealth accumulated.

In these quieter moments judgments are made on the economy’s performance. In turn, these bear upon general election votes. It is a eighteen months since Uncut spotted a gradual rise in the proportion of the electorate reporting the economy as doing well and a steady decline in Labour’s poll lead. We ran a regression to assess the relationship between these data series and postulated that the Tories would overtake Labour when a quarter of the electorate came to the view that the economy is doing well.

In May last year, when YouGov’s tracker on economic sentiment first started to bump up against a quarter of the electorate being of this belief, we noted that Tory poll leads had started to emerge. These leads were faltering and slow to confirm themselves. Like the upward trajectory in the proportion of the electorate positive about the economy.

24 per cent of the electorate thought the economy was doing well last May and Labour held an average of a 3 point poll lead, as the table below illustrates. Occasional Tory leads then existed but the average favoured Labour. The Tories weren’t consistently ahead but nor was economic sentiment resoundingly over a quarter. At 30 per cent, economic sentiment now comfortably clears the quarter threshold, and Labour’s poll lead is less impressive than last May.

If we simply compare the data in May 2014 and March 2015, they seem to confirm the original Uncut hypothesis: the more the economy improves, the narrower Labour’s lead. The pattern of these series between these two months, however, rewards inspection.

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The budget was Labour’s last chance. History is clear about what happens next

19/03/2015, 12:08:19 PM

by Atul Hatwal

Labour desperately needed George Osborne to produce another omnishambles budget. Something to reverse the ebbing tide of Labour’s poll lead.

It didn’t happen.

Osborne may have concocted an utterly ludicrous public spending profile for the next parliament – savage, penal cuts immediately followed by lavish expenditure, which led even the Office for Budget Responsibility to describe it as a “rollercoaster” – but he managed to kill Labour’s most potent attack line: that spending would be taken back to levels last seen in the 1930s.

Now, with under two months until the general election, history is very clear about what happens next.

Labour’s poll rating will almost certainly slide. Over the past fifty years of elections, Labour has lost an average of 4% in the last two months before an election.

Given an average poll rating in March (so far) of 33%, this would take Labour back to square one on May 7th with 29% of the vote, the same as 2010.

Poll rating1

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UKIP and the Greens are united by one thing: voodoo economics

17/03/2015, 09:55:30 AM

by Callum Anderson

Just a few weeks remain of the 2010-2015 UK Parliament. On Wednesday, the coalition government rolls its dice one last time, in an attempt to woo undecided voters.

Meanwhile last weekend, Ed Miliband unveiled Labour’s election pledge card at Birmingham’s ICC. The first two pledges – building a strong economic foundation and raising the higher living standards for working families – have sought to serve as indicators of Labour’s simultaneous commitments to fiscal prudence and growing the economy.

Indeed, it is the economy that will decide this election, with Mr Miliband’s Labour set to ask the electorate that famous question: “are you better off than you were five years ago?”

Whilst much of the scrutiny has rightly been reserved for the main three Westminster parties, it is the economic policies of the two most significant ‘insurgent’ parties – UKIP and the Green Party – that serve as the most unknown factor of the election.

So, where do UKIP and the Greens stand on economic policy?

Traditionally, UKIP has positioned itself as a libertarian party. However over the last year, in pursuit of widening its appeal, the party has drifted leftwards on economics, if not in social affairs. The UKIP of 2010 offering a flat income tax is a distant memory. But the result has been the same: economic illiteracy.

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