by Dan Cooke
One thing we learned in the election campaign was that the younger Ed Miliband, while apparently much in demand, was a lousy date who “only wanted to talk about economics”. We also learned something much more serious: the mature Miliband and his advisers were completely wrong to think Labour could win an election without talking about the economy.
The Tory narrative on the economy, before and during the campaign, was so clear and powerful that friend or foe could recite it in their sleep. They had a “long-term economic plan”, that got the economy “back on track” after Labour “crashed the economy” and the “money ran out”. This account of the recent past provided powerful rhetorical support to their forward offer of prosperity for all, including more investment in the NHS than Labour promised.
If this grates with unfairness to many of us, we have to bluntly ask: did our party ever pose a counter-narrative to challenge this one? The frank answer is – at least during the campaign – clearly no. The line to take, when it was put to Labour spokespeople that the Tory plan was working, was apparently to say that the recovery was not felt by all, the proceeds of growth were unevenly distributed or, more abstractly, that the economy was run for the benefit of the rich and not ordinary people.
Unfortunately these were talking points only to avoid talking about what for most people is the central question of economic debate: who can be trusted to deliver growth and jobs. It sounded as though we were saying this did not matter because it was the “wrong growth” and the “wrong jobs”. By building a campaign around issues of how to regulate a successful economy, like banning zero hours contracts, we forfeited the debate on who can be trusted to deliver a successful economy in the first place – in other words the debate that actually decides votes.
This was an inexplicable dereliction of duty. It has become popular in the nascent leadership election to say that Labour should have defended our own economic record more, but that’s not the only thing we failed to do: we failed to seriously attack the Tory economic record as well. A coherent account of the two would have given an alternative economic narrative to argue, rather than trying to change the subject and appearing, defensively, to have nothing to say about voters’ number one concern.
Here’s a back-of-the-envelope attempt. The Tories inherited an economy that had been through recession on the back of a global financial crisis but had started to recover: growth in the second quarter of 2010 was stronger than we have seen at any point since. Enter Cameron and Osborne whose core economic policy was to eliminate the deficit in one Parliament but, when they tried to do this, they killed the recovery and pushed the country into recession. In the end they were forced to abandon this central policy and retreat to essentially the position of Alistair Darling in 2010 that the deficit should be halved over the Parliament. Only then was a modest recovery belatedly delivered.
On this argument, today’s recovery was not something to be grudgingly ignored or dismissed by Labour, allowing the Tories to celebrate as vindication of their “long term economic plan”. Instead the eventual recovery should have been seized upon to indict the wasted years while Osborne pursued his promise to clear the deficit in one go; and his ultimate failure to do so mercilessly branded as a Tory U-turn equivalent to Black Wednesday, when Major’s government was forced against its will into a policy that eventually brought growth for which they were allowed no credit.
Perhaps this narrative is too neat. Maybe it would never have cut through and maybe it misses a crucial element or nuance to have been fit for the political fray. Well, indeed, I am sure that the Oxford and Harvard educated economists that are two a penny in the shadow cabinet could have come up with something even better. The mystery is why they did not even try.
Instead, sadly, while Miliband may have improved his small talk since his single days, his ignore-the-economy approach got the party nowhere with the unattached voters of middle England. To avoid the same outcome at the next election, Labour must present the electorate with a coherent narrative on the economy. Otherwise, whatever interest or sympathy we may glean for other progressive policies, our party will continue to be dismissed by too many as “nice but financially incompatible”.
Dan Cooke is a Labour member and business lawyer
Tags: Alistair Darling, crash, Dan Cooke, economy, Ed Miliband, George Osborne, narrative
Good stuff of which I’m in complete agreement. The Tory spin has been so successful that when I’ve challenged people on the Tory economic record basic facts are now disputed. People simply don’t believe me when I tell them we were out of recession when the Tories took over or that growth in the last quarter (0.3 per cent) was half what it was when for the final quarter of the last Labour government. My heart sank during the election Question Time programme when an uppity businesswoman confronted Miliband on Labour’s record. The reaction the next day of the Left was to denounce her as a Tory troll but I thought she presented him with an open goal – she said the last 5 years had been tough but it was the Tory government that had been in power all this time! A simple recitation of everything said above might have given Miliband a slam dunk for the evening, who knows it might have saved 20 seats or so. But he waffled the usual line about not spending too much on schools and hospitals until he moved back into his comfort zone of the NHS. There’s a good centre-left economic case to be made but it needs to be made because the voter will always pick the nasty candidate over the nice guy if he or she doesn’t trust the nice guy with his or her money.
The narrative that Labour overspent is true. We were running a deficit after 14 years of growth. Brown had overshot his deficit predictions every year from 2002. We were running just under 3% in 2007, the upper limit of what is considered acceptable. No wonder we did way worse than Canada, Germany and others.
Bring back Prudence! And consign Micawber to the bin!
When the Tories say they want to cut the deficit they really want to reduce the tax that business pays. How can a socialist party create policies that accept we have a capitalist economy and yet limit greed and exploitation. Tax payers support business by paying income support to low paid workers. Money is poured into the NHS yet no one seems to question excessive salaries taken by top management. Ditto other areas of public service. Excessive profits are made by companies who sell unhealthy food and this costs NHS resources. Its crazy – yet no one except possibly the Greens talks about it. And I just don’t understand how the current EU system can ever benefit low income workers who do understand how supply and demand works in the labour market. How can socialism work in a capitalist economy?
“Perhaps this narrative is too neat.”
It’s straightforwardly fictional. Too many people knew this. That’s why it wasn’t used.
Brown was running a fat structural deficit at the top of a boom, or cycle, or bubble (take your pick), while the Treasury coffers were stuffed with the tax take from financial services and property.
See Labour List http://tinyurl.com/nd754n3
“Labour were seen as too profligate, too soft on welfare and immigration, and too incompetent, according to a major post-election poll carried out by the Trade Union Congress (TUC). There were both gender and age gaps, with men and older people more likely to vote Conservative.
The top three reasons people gave for not voting Labour were fears that the party could not be trusted with the economy and would spend too much, be too generous with the benefit system, and be forced to make too many concessions to the SNP.”
As I have said many times, Any Party with Ed Balls as Shadow Chancellor had zero credibility on economic matters.
None of the above is new, original or rocket science.
I assume the Party is either in denial or run by idiots. It’s been obvious since 2010. But there are lots of clever people running Labour – cleverer than I am. So it’s denial.
So my conclusion is simply: forget policies. Labour needs to ensure the people running the Party have zero – like NO – links to the past. A clean sheet. And especially no-one connected with Ed Miliband’s Shadow Cabinet. They are all guilty by association. They clearly cannot stand up and be counted on to tell the Leader when a policy is obviously rubbish. A bunch of yes men and women.
Once you have a new Leadership and new people, you can elect to choose new sensible voter friendly policies.
But it does not look as if it’s going to happen. Navel gazing and buck passing reigns.
@ Mike
Very true. And as usual, statistics are manipulated to hid the real truth. And in the case of Brown’s spending, he managed to move a lot of the debt he was accumulating ‘off the books.’ Wasteful PPI contracts and unfunded public sector pensions are massive, and were built up under New labour. In the case of unfunded pensions, the expansion of public sector recruitment under New labour is a massive sting in the tail that will be of great detriment to future generations. Not that this shows up in any figures!
Finally, the whole ‘debt to GDP ratio’ is absurd as the public sector averages between 30-40% of GDP!
Your ‘back-of-the-envelope attempt’ is essentially the position ED Balls alighted on. The problem was that no-one listened as a) the Tories had established their narrative first; b) Labour didn’t acknowledge any issues with their stewardship of the economy in the run up to, and during, the crash and c) the economic policy at the election did not chime well with the ambivalent messages on business during the previous years.
The narrative could only have cut through if those 3 issues had been addressed.
Your narrative uses the phrase “pushed the country into recession”. There wasn’t a recession during the last parliament. So that line would be a good target for anyone seeking to discredit your narrative.
People vote as a rule on their own experiences of the present that they are living in. The remember what happened under the last Labour government. Then they look at now. They see a crash back then and they are starting to see a recovery now. They saw runaway house prices back then, they see stable house prices in most places now. They saw runaway rents back then, they see stable rents in most places now. Over 89% of people handled at A-E are still seen within 4 hours so they don’t see a crisis. They resented the size of, wages of and pension provision of the public sector back then, they see that reduced now. They hear a Labour party that wants to go back to how it was and a tory party that talks about the future.
The biggest mistake Labour are going to make (not might – are) is to set their stall to re-fight GE2015. That’s gone now. By the time GE2020 comes one of the most radical Parliaments in history will have changed the UK dramatically and forever and the dynamics of GE 2020 will be totally different to anything that has come before. If Labour haven’t completely re-aligned, modernised from top to bottom, identified exactly what they stand for for the future and how to message it and developed entirely new strategies and direction by 2018 at the latest, then it will be toast in 2020. Forget tradition and history – that’s for losers.
My money’s on toast. Thick cut, with butter and marmalade.
@Tafia Agree, If Labour don’t develop a coherent policy on Immigration the Economy and Housing, they will be toast. In the next 5 years Labour should be transforming itself into a New Social Democratic Party, and dropping the ‘Labour’ tag, which is getting a bit tired and worn out.
My memory of Labour’s economic narative was rather different post 2010.
First we had the leadership contest when Ed Balls said that the Darling recovery plan was too austere and the cuts should be slower.
Later we had the cuts would lead to millions unemployed, and the private sector wouldn’t be able to pick up the cuts in state sector employment.
Then there was the “recession made in Downing Street” attack line.
Then we had the flat lining economy… Ed Balls and his hand gestures all the time.
Remember the triple dip recession prophecies too.
Finally about a year before the election the party started to make noises about about not spending too much; and while the economy did pick up as you pointed out, the opposition seemed churlish complaining that they were the wrong jobs.
So to say Labour didn’t try to have an economic narative is unfair… It just wasn’t one that was very convincing to the non tribal voter.
Paul Krugman has suggested that Osbourn could not have timed yhings better if he tried. Knocking the recovery on the head in 2010 to ensure ithe economic cycle coincided with the electoral cycle!
E