Posts Tagged ‘economy’

Labour needs a clear, distinctive, and credible economic message

23/07/2020, 08:00:31 AM

by Jonathan Todd

More people than not think that Keir Starmer looks like a prime minister in waiting (38% versus 34% in a YouGov poll conducted in early July), while more than twice as many think Labour is not ready for government than think Labour is (54% versus 23% in the same poll).

Other polling reveals that voters now think that Starmer would make a better prime minister than Boris Johnson.

Yet Labour trail the Tories by somewhere between 6 and 10 points on voting intention – with Survation putting it at the lower end of that range, Kantar being at the higher end, and Opinium in-between.

These deficits cannot be explained in terms of Starmer. It is the rest of the party that holds us back.

“Labour is under new management,” said Starmer at PMQs. Where Labour previously made commitments that voters struggled to believe, Labour now needs credible answers. Yet big enough to meet the UK’s challenges.

These do not come any bigger than the economy. The number of people aged 18-24 claiming Universal Credit or Jobseeker’s Allowance doubled in the last three months. Unfortunately, with furlough ending, demand not recovered to pre-Covid levels, and the risk of a second wave, our economic struggles are likely to persist.

With respondents being allowed to tick up three options, YouGov asked: Which of the following do you think are the most important issues facing the country at this time?

Health and the economy came joint top on 57%. Far ahead of the next most important issues: Britain leaving the EU (43%); the environment (24%).

It is noteworthy that over four-in-ten of the public do not see Brexit as “oven ready” and unsurprising that health is a concern amid a global pandemic – which will further rise if there is a second wave. But, as we learn more about Covid-19, improve our systems for containing it, and advance towards a vaccine, the economy will likely usurp health as the public’s biggest worry.

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A Labour shadow chancellor: the impossible job?

14/04/2020, 10:15:36 PM

by Callum Anderson

Earlier this month, Labour decisively turned the page from the Corbyn era.

An eagerness to look to the future was the prevailing emotion for the many Labour activists and supporters, who had watched with varying degrees of resignation and despair as Labour crashed to its worst general election defeat since before the Second World War.

Yet we must not forget that Keir Starmer’s election as Labour leader can not be an end in itself. Rather, it must provide the Labour movement with a critical lifeline to change where change is needed, and rethink where rethinking is needed. We must all rally behind the new leadership to support this essential work.

As the new shadow chancellor, Anneliese Dodds will play a particularly key role in helping Labour earn back both the trust and the economic credibility that it so desperately lacked during the last decade.

Dodds is extremely well qualified. Despite an absence of executive experience, she served as a shadow treasury minister for the last two and half years. As an MEP, she sat on the European Parliament’s Committee on Economic and Monetary Affairs.

Nonetheless, her task is no small one.

Long regarded as one of the most difficult job in politics: a prospective chancellor must be able to understand and absorb economics, and articulate the Party position in a way which can command respect in Parliament, and is comprehensible to the person on the street, the small business owner and financial markets.

For the last decade, Labour’s achilles heal could be simply posed as a question: can it be trusted to prudently manage the public finances, while still delivering economic and social justice?

As we all remember, Messrs Miliband and Balls were never able to shrug off the (false) Conservative frequently claims that Labour profligacy had caused the 2007-8 financial crisis and had necessitated austerity.

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Labour, co-owner of #brexitshambles

03/02/2020, 10:30:38 PM

by Rob Marchant

We are out. That’s it, the fat lady has sung.

But of course we are not out at all, not in any meaningful sense. This is just the start of a tortuous, eleven-month scramble to try and get some kind of a sensible result in place by the end of the year.

Remainers have to admit that they – we – lost the argument, at least for now. Leavers have got what they wanted and, ultimately, that’s democracy.

But, Leaver or Remainer, we have had in many ways the worst of all possible worlds. Leavers have not really got what many wanted, at least, not yet. If we leave aside the semi-suicidal, macho contingent who are happy to have the hardest of hard Brexits, moderate Leavers will now see that we now have eleven months to get somewhere on the sliding scale between what one former PM has rightly called the “pointless Brexit” and the “painful Brexit”.

If we end at the “pointless Brexit”, people on both sides will rightly say, we might as well have stayed in. Most of the benefits but without a seat at the table.

If we end at the “painful Brexit”, for example, with few and/or poor-outcome trade deals in place, the economic jolt to come will be memorable. And, it must be said, we have both precious little time to get those deals in place and the poor bargaining power of the supplicant. But we are where we are.

And somewhere in the middle? A bit of both of the above or, perhaps, not even really possible. Perhaps it will quickly converge down to just that binary choice of one or the other: who knows.

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The UK will vote to be inside the EU – eventually

05/06/2018, 08:31:35 AM

by Jonathan Todd

The UK will have another referendum on our membership of the EU. Rather than if this will happen, it is more a matter of when, on what terms, and in what circumstances.

This is because:

  • The referendums of 1975 and 2016 have established a de facto constitutional principle that the UK cannot move in or out of the EU without a referendum.
  • If this referendum does not come before March 2019, and the UK exits the EU at the closing of the Article 50 window, the UK will make right-wing and/or left-wing attempts to find a new place in the world, but neither will be able to turnaround the ongoing diminishment of UK living standards associated with Brexit, building pressure for a revision to the status quo ante.

There’s much to be said for the Ken Clarke view that referendums are defective instruments. It is difficult, however, to imagine circumstances in which it would be politically possible to reverse the verdict of 23 June 2016 without another referendum.

While Best for Britain is expected to publish its campaign manifesto on 8 June, calling for such, given the intransigence of Labour and the Tories towards a referendum, the likelihood remains that the UK will leave the EU in March next year.

45% of the public now expect that this will have a negative impact on the economy. Versus, according to the latest polling, 30% who think it will have a positive impact. Only 13% think it will make no difference to the economy. In contrast, 40% think it will have no impact on their personal finances.

“A recession,” Ronald Reagan said, “is when your neighbour loses his job. A depression is when you lose yours.”

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Enshrining profit sharing into our economy will allow Britain to build a truly common wealth

27/03/2018, 10:44:31 PM

by Callum Anderson

Living standards for millions of hardworking people across the UK remain squeezed. By the end of 2017, British workers’ pay packets were still £15 a week below their pre-financial crisis levels; the Resolution Foundation predicts that pay won’t fully recover until 2025.

At the same time, bosses of the FTSE 100 earn on average 94 times more than the average employee. In too many cases, these sometimes astronomical levels of pay bear no relation to either personal or company performance.

Indeed, the first Thursday of 2018 was known as Fat Cat Thursday – where the average FTSE 100 chief executive had already been paid what it would take the typical UK worker an entire year to earn.

The sheer magnitude of this income inequality should worry all in society. In an era of economic uncertainty and instability – characterised by stagnant wage growth, job insecurity and depressed levels of business investment – Labour must offer an ambitious package of genuinely bold economic reforms that promote an inclusive, collaborative brand of UK capitalism.

One important feature of this should be to promote the use of profit sharing.

Enshrining the principle of profit-sharing – whereby a company apportions a percentage of annual profits as a pool of money to be distributed among the workforce – into our economy would reinvigorate British workplaces by ensuring that a share of their company’s rewards are also passed onto all members of the workforce who helped generate success and not just management and shareholders.

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May and Trump are in charge – but voters’ wallets still rule

23/01/2017, 07:15:13 PM

by Jonathan Todd

Trump’s inauguration. May’s speech. We are told that Trump is a protectionist and May is for free trade. But they both reject the social market that characterises the EU, making it a golden shower of a week for internationalist social democrats.

The market comes via trade within the EU, while the social is injected by having this occur above a floor on workers’ and consumers’ rights, as well as protections for the environment and other public goods. “We would be free,” threatened the prime minister, “to change the basis of Britain’s economic model.” The social dimension of the EU model would not endure any transformation into Dubai-on-Thames. Nor, according to a former head official at the Treasury, would the NHS.

It is also the market, not the social, that attracts Trump – perhaps better described as a mercantilist than a protectionist – to a trade deal with the UK. He wants a wall on the Mexican border but he doesn’t want, in contrast to a pure protectionist, to wholly encase America behind trade walls. He does, though, seem to view trade as a zero-sum game, not a win-win exchange. And he eyes a win for America in a negotiation with a UK to be stripped of EU social regulations and looking for friends after politically detaching ourselves from our European partners.

Trump perpetuates the myth that America has ever put itself anywhere other than first. Pumping, in today’s money, around $120bn into Europe via the Marshall Plan, for example, wasn’t just about compassion for a continent on its knees after World War II. It was about minimising the risk of American blood being spilt on European soil, opening up European markets for American goods, and creating a European bulwark between the Soviet Union and the Atlantic.

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How to fight hard Brexit: Step 1 – Understand why Remain lost. Spoiler: It’s not what Westminster thinks

28/12/2016, 11:04:18 AM

In a series of three pieces, Atul Hatwal sets out how hard Brexit can be fought in the coming years. Today he looks at why Remain lost and the implications for the battle to shape Brexit

Why did Remain lose? Since the referendum Brexiteers have been assiduous in asserting their narrative: immigration trumped the economy, emotion won over facts and these are the new rules of the political game.

The Brexiteer version of history is now the accepted consensus at Westminster, virtually unchallenged by pro-Europeans, often meekly accepted.

The state of the pro-EU camp feels very familiar, certainly to a Labour member. All very mid-1992 when following a fourth electoral defeat, the best that many senior leaders of the party had to offer by way of strategy was “one more heave.”

It wasn’t good enough then, it isn’t now.

The starting point for pro-Europeans is to ask the right question.

Not just why Leave won but why a Remain campaign built around familiar economic beats failed when the same backing track had proved so persuasive at the general election and the 2014 Scottish independence referendum.

At the election and referendum, campaigns targeting concerns about the economy had convincingly defeated Scottish nationalism in 2014 and crushed Ukip’s English anti-migrant nationalism in 2015.

The conventional wisdom is that immigration was more potent as an issue in 2016.

Fortunately for those who want to prevent a hard Brexit, this is wrong.

The British Election Study (BES), which surveyed a huge panel of 30,000 voters before and after the referendum, sheds some light on what actually happened.

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It’s always the economy stupid. Time for Project Fear to turn up the volume

15/06/2016, 12:42:39 PM

by Samuel Dale

What has Remain been doing? The campaign to keep Britain in the EU has been spinning around like a Catherine Wheel in the last few days.

Some of this is down to effective campaigning from Vote Leave. After months of focusing on nonsense like sovereignty and weak economic arguments, they have started to focus on the only topic they can: immigration.

They are running advert after advert on Turkey becoming a member of the EU by 2020 and millions of Turks (or, nudge, nudge, hint, hint: Muslims) coming to the UK.  Total lies and nasty smears but effective campaigning and the only message that resonates for them.

But Remain’s initial response to this aggressive shift and a few worrying polls has been bonkers.

Instead of ramming home it’s winning economic arguments it left the floor to Gordon Brown to waffle on about global peace and influence.

And instead of simply ignoring immigration – which it absolutely must at this late stage – it has left Labour to talk about a future deal or renegotiation. Or even a Scotland-style Vow on controls.

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SNP 2014. Labour 2015. Vote Leave 2016

06/06/2016, 10:58:28 PM

by Atul Hatwal

Vote Leave are living the dream. Ed Miliband’s dream of the final weeks of the general election campaign that Labour was en route to power. The same dream which Alex Salmond had in early September 2014 as the independence referendum approached.

Dreams abruptly interrupted, for Miliband and Salmond, on election night as the exit polls were released.

About four years ago, within progressive circles, there was much chatter about a campaign concept which came to be deployed at the heart of both the SNP’s independence effort and Labour’s general election campaign: reframing.

Based in cognitive behavioural therapy, it offered a route to recast the way key issues, such as the economy, were perceived by the public.

Rather than face tough choices about public spending, Labour thought it could reframe the economic debate around fairness instead of debt, focusing discussion on the impact of cuts rather than the net fiscal position.

In the general election campaign, Labour led with this approach, highlighting the iniquities of Tory non-dom tax breaks and cuts agenda while being bombarded by Tory attacks on Labour profligacy.

At the independence referendum, the SNP tried to avoid fighting on the main macro- economic battlefield to refocus on the threat of Tory cuts to Scotland’s economy and way of life, most notably to the NHS, if Scotland remained part of the UK.

Last week, Vote Leave took a leaf out of the Labour and SNP playbook and attempted their own version of reframing.

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Team Brexit’s political misjudgements have turned a campaign drama into an existential crisis for their cause

26/05/2016, 07:00:53 PM

In a three part series Atul Hatwal looks at the state of the two EU referendum campaigns and the likely winners and losers from the vote. For his second post, he reviews the performance of the Brexiteers.

Few would describe the Labour party as a model of electoral success in recent years.

But the two-headed Brexit team of Leave.EU and Vote Leave have contrived to ape Labour’s biggest mistakes over the past six years, combining the worst of Corbyn and Miliband to create a Frankenstein campaign that frequently defies belief.

The Faragists of Leave.EU are the Corbynistas of this campaign.

For Farage its immigration, for Corbyn its austerity, either way their mode of monomania is the same.

Britain’s electoral experience and current polling suggests that the economy matters most to voters.

But the Faragists don’t care about evidence.

Their faith-based approach to argument ignores the niceties of engaging with swing voters’ priorities in favour of shouting the same thing about their pet issue, EU migrants, over and over again, more and more loudly.

The stock response to set-backs or public rejection is to retreat into a nether-sphere of conspiracy theories about media bias, skewed polls and conniving, establishment lizard overlords.

The louder the Faragist tendency shouts, the more the anti-EU cause is seen by mainstream voters as a fringe concern propagated by advocates nearer David Icke than David Cameron on the credibility spectrum.

About the only thing that can be said in defence of the Faragists and Corbynistas, is that their position is at least constant.

In contrast, the Vote Leave campaign, who were meant to be the Brexit adults in the room, seem to have taken Ed Miliband as their model.

Like Miliband, they understood that banging on endlessly about what animates activists is not a route to victory.

They saw the importance of swing voters.

But like Miliband, they haven’t been able to bring themselves to act on voters’ concerns.

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