by Jonathan Todd
“In 2008-09,” Gordon Brown recently told New Statesman, “we tried to persuade people that it made sense to run a deficit and it was not a problem in the long term if debt rose in the short term. We failed to persuade people. If anything contributed to the return of the Conservatives to power, it was their ability to scare people about the deficit and debt.”
After succeeding Brown as Labour leader, Ed Miliband attempted to become prime minister by positioning Labour to the left of New Labour. This strategy was thought to be justified as the financial crisis of 2008-09 had enlarged public appetite for stronger regulation and an expanded economic role for the state.
In 2015, Labour and the rest of the country moved in opposite directions. Labour’s general election defeat brought into doubt the extent of the appeal of Miliband’s more muscular state. Jeremy Corbyn’s ascent indicated that Labour considered Miliband’s offer too tepid.
“Now,” Brown continued in his New Statesman interview, “the fiscal orthodoxy has changed. What we were criticised for in 2009-10 is understood to be the best way of dealing with a crisis. We’ve got to understand that the only way that you can replace spending power and economic activity when the private sector fails to be able to invest, and consumers are not spending and people are not able to work, is that the government steps in.”
It must be hoped that Brown is right about the fiscal orthodoxy. Yet Jo Harding reminded Uncut, “local authorities are facing a £10 billion black hole due to coronavirus.”
This is despite Local Government Secretary Robert Jenrick telling 300 English council leaders and sector bodies in a conference call on 16 March that the government would do “whatever is necessary” to help them tackle coronavirus.
