economic competence « Labour Uncut

Posts Tagged ‘economic competence’

Ed Balls was a useless shadow chancellor

02/09/2016, 10:50:09 PM

by Kevin Meagher

‘You are only a man’ servants used to whisper in the ears of Roman generals to stop them believing their own hype on their triumphant return from battle.

It’s a pity no-one ever performed a similar service for Ed Balls.

The former shadow chancellor, who was unceremoniously ejected by the people of Morley and Outwood at the last election, is rematerializing into British politics, with a new book out about his life in politics and some unsolicited advice for the party.

The extracts show Balls for what he is: a clever and effective politician in many ways. Unfortunately for him, his curse is hubris.

His period as shadow chancellor under Ed Miliband was an unmitigated disaster for Labour.

Routinely 20 points behind Cameron and Osborne throughout the last parliament on questions of economic competence and trust, it was clear three years out from the election that the party was stone-cold dead on the economy.

His associations with the dog-days of Gordon Brown’s government meant Balls – so long his factotum at the Treasury – was an insane choice for the role.

He was a constant, corporeal reminder of Labour’s previous mistakes, which the party in government did so little to contextualise when it had the chance.

But he coveted the job when Alan Johnson, Miliband’s original shadow chancellor, quit. Pride got the better of him and he simply wasn’t slick enough to shake off previous form to win a second hearing.

At no point did he manage to alter the terms of political debate.

Labour spent too much and regulated too little. They didn’t fix the roof when the sun was shining. They maxed out the credit card. They have no long-term economic plan. The blows rained down on Labour’s reputation and Ed Balls was not equal to the task of rebutting them.

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John McDonnell sheds his Corbynista cloak

29/09/2015, 09:50:06 AM

by Nick Small

For the 4.5 percenters, who, like me, backed Liz Kendall, John McDonnell’s first major speech as shadow chancellor at Labour Party conference was, in many ways, a pleasant surprise.

The acknowledgment of a golden rule of British politics, that the voting public demand reassurance from the centre-left about our economic credibility in a way that they don’t from the Tories, is welcome. It’s also welcome that McDonnell has explicitly reinforced the message that economic prosperity and social justice are two sides of the same coin; as our aims and values put it that means ‘a dynamic economy serving the public interest’. In other words, you can’t redistribute wealth unless you first create it.

Recognising that the country has to live within its means, that Labour should tackle the deficit fairly and that a Labour government inheriting a current account deficit in 2020 should pay it down without jeopardising sustainable economic growth is, again, good to hear. It’s not austerity-lite and it’s not deficit denial. This will chime well with the voters who’ll decide the next election. They may well be more economically radical than many from my wing of the party thought, but they’re certainly more fiscally cautious than many Corbynistas gave them credit for.

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The Labour party is responsible for this defeat. It’s our fault. Nobody else’s

10/05/2015, 10:57:47 AM

by Atul Hatwal

Labour lost the election for the same reason that parties always lose elections – mistrust on the economy and leadership.

Defeat turned to utter disaster though following a grossly inept campaign.

As parliament was dissolved at the end of March, for the start of the short campaign, it was clear that Labour was going to lose. Just as it was clear at the start of the year and has been so for a number of years.

For the entirety of the past five years, Ed Miliband and Ed Balls trailed David Cameron and George Osborne in terms of who the public trusted to best manage the economy. At the start of April the deficit was 25%.

And for the entirety of the past five years, Ed Miliband also trailed David Cameron on the public’s preference for prime minister. In April, the average deficit was 15%.

Two numbers. 25% and 15%. These are the reasons that Labour was going to lose to the Tories, no matter what type of campaign the party ran.

These are also the reasons that Labour was always going to lose to the SNP in Scotland.

The SNP pitch was only possible because Labour was evidently weak and Nicola Sturgeon could portray her party as the best route to stopping the Tories.

If Labour had been comfortably ahead in England and held the confidence of Scottish voters on the economy and leadership, this would not have been possible.

In the cacophony of polls, statistics and data journalism, this is the signal. All else is noise.

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What has changed on the deficit since general election 2010?

07/01/2015, 08:31:55 AM

by Jonathan Todd

This is the first of a series of pieces from Uncut on what has changed in respect of key political issues since the last general election. Looking over this timescale, we hope to distinguish the signal from the noise; what really matters from the day-to-day froth.

Liverpool played Burnley away on Boxing Day. The last time that happened was just before the 2010 general election when Rafa Benitez managed Liverpool. Roy Hodgson and Kenny Dalglish both did so between Benitez and the current reign of Brendan Rodgers. Hodgson’s tenure coincided with the near bankruptcy of one of the world’s great sporting institutions. Enter John Henry, deus ex machina. This American has invested in the club stadium and playing squad, including in Luis Suarez, who brought both disgrace and nearly a Premier League title. Life is easier off the pitch and harder on the pitch sans Suarez. Fans yearn to be made to dream again. And will soon have to hope to do so without talisman Steven Gerrard.

In summary, much has happened at Liverpool since the last general election. Soon after which, I wrote my first piece for Uncut on ‘the emerging politics of deficit reduction’. Since when, as much as politics feels like a rollercoaster, these politics have changed remarkably little. Around the time that piece was published, Peter Mandelson was fighting for airtime by launching his memoirs.

We would not convince the country, Mandelson conceded on the deficit, that the Tories were going too far unless we convinced them that we would go far enough. That reflection on the 2010 election exactly parallels the advice that both myself and Samuel Dale have recently given Labour’s current campaign. I called for ‘Don Miliband’ to show himself, Sam for a ‘carpe deficit’ moment. The terminology doesn’t matter, the point is the same. Mandelson returned to the debate before Christmas to make a similar point in a speech to a Progress and Policy Network conference. Labour, Mandelson advised, will only get a hearing on ‘what will the effect be on society and the economy?’ if we are clear on ‘how much must we cut public spending?’

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If we are all Labour Uncutters now, let’s do this properly

15/12/2014, 10:25:32 AM

by Jonathan Todd

We are all in the black Labourites now, Labour Uncutters and proud. It was In the Black Labour published by Policy Network in 2011 that reminded us that fiscal prudence and social justice are complementary. It was Labour Uncut at conference in 2013 who provided detail in our book on how this might be done, how £34bn of additional savings in 2015/16 could be reallocated to Labour priorities.

Both publications were contentious. They – at least In the Black Labour – are now orthodoxy. Higher debt interest payments, Ed Miliband noted in his speech last week, as In the Black Labour did previously, squeeze out money for public services and for investment in the long-term potential of our country. Following the Miliband speech, Phil Collins observed in the Times that the difference between an old Brownite and an old Blairite is about three years. The dates of Miliband’s speech and In the Black Labour prove him right to the week.

The headline used by Collins’ paper to report the speech – I’ll cut deficit but won’t reveal how, says Miliband – showed, however, that Miliband is yet to go as far as Labour Uncut has gone. In isolating additional cuts we’d support, Labour Uncut created resources to apply to different priorities. In the spirit of Mad Men’s Don Draper, we didn’t like what was being said about Labour (that the party can’t be trusted with public money), so we changed the conversation (by fronting up to enough cuts to create fiscal room for a set of policy priorities distinctly Labour and different from those of the Tory-led government).

Miliband didn’t do the full Draper. Maybe he got as far as a Pete Campbell, another Mad Men character. Moving in the right direction but lacking Draper’s uncompromising edge. Yet Miliband doesn’t need to that audacious to remake himself in Draper form. Carl Emmerson, deputy director of the Institute of Fiscal Studies, reckons he has a £50bn target to shoot at. That’s the fiscal room between Conservative plans and Labour’s commitment to balance current spending by 2020.

£50bn is ample to signpost a Labour future. But voters won’t reward what you promise if they conclude you won’t deliver it. The £50bn can play the role played by house building and childcare within the Labour Uncut book; the altered priorities made affordable by identifying sufficient cuts. The political gain that attaches to this £50bn, however, is conditional on demonstrating how we’d balance current spending by 2020.

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Labour’s wants to triangulate on the deficit but has forgotten how

11/12/2014, 02:45:44 PM

by Atul Hatwal

Today, Labour remembered the deficit. Good, it’s long over-due. The party senses an opportunity, one last chance to reduce the Tories’ double digit lead on the economy.

The theory is clear. George Osborne’s draconian spending plans are just too apocalyptic for the public. He’s opened up political space for a middle way, for Labour to triangulate and offer a deficit reduction path that does not necessitate taking a meat cleaver to the welfare state but does show a clear route back to a balanced budget.

The polls seem to back this approach. In yesterday’s ComRes poll, 52% agreed with the proposition that “it would be better to slow the rate of spending cuts even if it makes it take longer to get the country’s finances back on track” while just 25% disagreed.

Ed Miliband and Ed Balls are both on our screens today promising this middle way, hoping for a route back into the economic debate.

Unfortunately for Labour, and the country’s future, Miliband and Balls are going to be disappointed.

There is a strategic flaw at the heart of the party’s approach: Labour strategists have forgotten how to triangulate.

For triangulation to be effective, three conditions need to be met: there must be defined positions to the left and right on a topic which opens space in the middle, the public need to be dissatisfied with the polarised positions on offer and to trust the party or politician that is triangulating, to deliver on their centrist commitment.

It’s certainly true that George Osborne’s vision of austerity-max has shifted the Conservatives further to the right on the economy than their previous positioning. The much publicised IFS judgement that the cuts would take spending back to 1930s’ levels has resonated, with Osborne’s personal ratings taking a palpable hit – in the aftermath of the Autumn statement, YouGov found his net approval rate dropped from -8 to -11.

But the problem for Ed Miliband is that the left flank is occupied by Unite, most of the union movement and a fair proportion of the PLP, including some shadow cabinet members.

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Miliband only has himself to blame for Osborne’s reckless tax cuts

09/12/2014, 10:56:14 AM

by Samuel Dale

I laughed when I first heard yet slowly but surely the true horror of Ed Miliband’s gaffe has began to sink in.

When our leader forgot to mention the deficit during his 80 minute conference speech in Manchester he handed the Tories a free rein on the economy.

Tory minister has tripped over Tory MP to claim, fairly, that Miliband does not care about the UK’s debt mountain and deficit.

Of course, the gaffe could only gain traction because Labour has failed to rebuild its economic credibility in the last four years.

The lack of a credible alternative on reducing the deficit has allowed the Tories to develop a completely ridiculous and undeserved reputation for sound economic management.

Britain might be splintering into a four or five party system but on the economy it is still a two horse race between potential prime ministers and chancellors. It’s a zero sum game; one party is up, the other is down.

Since 2010, George Osborne has drastically missed his deficit target, lost the UK’s AAA credit rating, increased public debt by trillions and made huge gambles on the tax revenues.

He has also overseen a collapse in living standards, years of stagnant growth and a shameful under-investment in infrastructure.

To give some under-reported examples of his recklessness: Raising the income tax allowance threshold to £10,000 combined with slow wage growth has seen income tax receipts plummet by billions.

In addition, the changes to stamp duty last week and pensions next year create huge tax uncertainties as well, recklessly populist tax cuts in the pursuit of votes.

Then, of course, there are £7.2bn of unfunded income tax cuts for lower and middle earners promised after the election.

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Progress Annual Conference 2014: Labour slowly faces up to reality

02/06/2014, 09:26:36 AM

by Jonathan Todd

The Progress annual conference 2014 was a conversation in slow motion. The political context means there is little point in discussing much besides three questions: Is Labour on track to win next year? If not, why not? Given this, what strategy should Labour adopt?

Peter Kellner drew gasps in answering the first of these questions – even though he said little that he hasn’t elsewhere. Only fleetingly did we get on to two and three. However, being queasy about engaging with reality isn’t an anecdote to Labour’s building fatalism.

My view is that Labour is not doing as well as we might because we haven’t done enough in the past four years to respond to the messages of the 2010 general election. We now have less than 12 months till the next election. This implies a number of approaches to the period between now and then.

Keep going as we are – putting most of our eggs in the cost of living basket. I wrote for Progress magazine at the end of last year about my concern that this campaigning would be overtaken by events in advance of May 2015. I’m also not convinced that such focus on the cost of living does enough to show that Labour can rise to the national challenges that the governing parties are failing.

Another approach would be to attempt to do in one year what we might have done in five. 2010 confirmed that public trust in Labour as responsible custodians of public money has corroded, which undermines Labour’s capacity to win on other issues. In the book that we published for Labour party conference last year, Uncut set out a strategy for recovering this trust and building from this recovery to a credible and compelling Labour alternative.

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As Labour’s poll ratings dive, finally, the scales begin to fall from the Milibelievers’ eyes

13/05/2014, 07:00:30 AM

by Atul Hatwal

The biggest surprise is the surprise. Shock and consternation were in plentiful evidence across Labour’s twitter base yesterday at the news that the party was lagging the Tories in two polls.

But this was not some bolt from the blue.

Over the past months Labour’s lead has been slipping steadily. Yesterday was the first polling evidence of the logical denouement of a long established trend. Labour will almost certainly bob back into the lead in future polls, but with every passing month, the party’s electoral waterline will dip ever lower.

Some will point to the shambolic European election campaign as a cause of the drop in ratings. But, poor as the campaign has been, its impact has surely just been to accelerate the inevitable.

The problems underlying Labour’s predicament remain the same as they were this time last year, and the year before that, and the year before that.

Labour has still not satisfactorily answered the two questions asked by the electorate at the 2010 election: Can we trust you with the economy? And is your leader a prime minister?

At the last election, in both cases, the answer was a narrow but clear no. According to ICM’s polling just before election day, David Cameron and George Osborne held a 1% lead on the economy over Gordon Brown and Alistair Darling. And on preference for prime minister, YouGov registered a 6% lead for David Cameron over Gordon Brown.

The chart below shows Labour’s performance on these two indicators since the start of 2013.

David Cameron and George Osborne now lead Ed Miliband and Ed Balls by 18% on the economy while David Cameron bests Ed Miliband on preference for PM by 14%.

At no point in the past four years has Labour narrowed the gap on either the economy or leadership to the level it achieved on the eve of the election in May 2010. An election where Labour polled a miserable 29%.

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Labour’s poll lead is slipping again. Here’s why

10/12/2013, 12:28:22 PM

by Atul Hatwal

In a momentous week for news, one development has understandably slipped by without major comment: the shift in the polls since the Autumn Statement.

The Sunday Times YouGov poll had Labour’s lead at 5 points, today’s Sun YouGov poll similarly has the lead at 5 points and today’s ICM poll in the Guardian also registers a lead of 5. In comparison, the average YouGov lead in the week before the Autumn Statement was 8 while the November’s ICM poll also had Labour 8 points up.

A drop of 3 points in Labour’s lead, across 3 different polls suggests something has changed since the Autumn Statement.

Although caution is advisable given it is just a week’s polling, this shift has been expected by many and if confirmed in the coming weeks, will presage significant problems for the party.

In the two months since Ed Miliband’s conference speech, politics has been defined by Labour’s energy price freeze commitment.

Regardless of the economics, it has been politically successful in driving debate within the Westminster bubble. Countless column inches and interview minutes have been expended on the fall-out from the announcement. So much so that politics became polarised around support or opposition to the price freeze.

And this is part of the problem.

Labour’s year long slide in the polls appeared to have been arrested in October and November, but the profile of the price freeze has been such that the polls in these months virtually became referendums on whether action should be taken to reduce energy prices rather than predictions of voting at the next election.

The shift in the polls over the past week suggests the impact of the energy price freeze is now diminishing.

There is a precedent for this type of development.

In September 2000, for one month, politics was turned upside down. William Hague’s Conservative opposition reversed months of double digit ICM poll deficits to leap into a 4 point lead. The cause was the fuel crisis.

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