Jeremy making the running – while May runs away

By Richard Burgon

Labour wants to win the general election. We need to see the back of this cruel Conservative government. Over the next six weeks everyone in our party and the trade union and labour movement has a huge duty to fulfil.

Yes, Labour is currently behind in the polls. But we didn’t use that as an excuse to try to block a general election. We know that the Conservatives have made – and are continuing to make – the lives of those we represent and those we seek to represent harder, more difficult and more unpleasant. This general election is a chance to end that. Continue reading

Cruddas poll shows opposition to austerity

Jon Cruddas has today argued, as part of his independent inquiry into Labour’s election loss, that ‘the Tories didn’t win despite austerity, they won because of it. Voters did not reject Labour because they saw it as austerity lite. Voters rejected Labour because they perceived the Party as anti-austerity lite.’

The actual title of the LabourList article, and the political thrust of the accompanying Patrick Wintour piece in The Guardian, is ‘Labour lost because voters believed it was anti-austerity’.

As with others trying to assert this political line, Cruddas is engaging in an impressive feat of political spinning to reach this conclusion based on the questions and the findings so far published.

The question that ‘we must live within our means so cutting the deficit is the top priority’ is the kind of leading question that leads people to mistrust polling. But even taken at face value, broad agreement with such a statement does not lead to the conclusion Labour lost because people believed it was anti-austerity. Lord Ashcroft polling on the day of the general election produced results that people wanted an end to cuts, and did not believe any further should be made.

It is the article – rather than the independent inquiry – that reveals the Labour front bench still believe the deficit is the key issue, despite running a losing election campaign focused on it. They are as yet unable to break the mould set by the Right and provide a new focus for debate. Other questions include, ‘I am most likely to vote for the political party that redistributes wealth from rich to poor’, ‘I am most likely to vote for the political party that puts my financial interests first’ and ‘the economic system in this country unfairly favours powerful interests’.

Cruddas does not indicate that the panel was asked anything as simple as, ‘Do you believe Labour lost because it was anti-austerity?’ or if Labour were trusted to improve peoples’ living standards at the same time as they were saying they would make deep spending cuts.

From the data published, he has chosen a particular analysis, although one I think is difficult to substantiate. Alternatively, and based on his findings, I believe Labour should show how the government’s economic agenda, which can be summed up as austerity, ‘unfairly favours powerful interests’ and ‘redistributes wealth from poor to rich’, which the panel suggests is unpopular – and convince them how it would approach the economy differently to the Tories.

I would argue that these results demonstrate the need for a clearer anti-austerity and more progressive redistributive agenda from Labour.

Labour need to show it is putting individuals financial interests first – that it will improve peoples living standards – and that it will do so with by investing in a growing, sustainable economy that delivers good jobs, higher pay, better public services and transport as an alternative to the Tories insecure, low pay and sub-Living Wage, and cuts.

What Cruddas has effectively demonstrated, and where I would agree with him is that Labour’s message on austerity and fiscal responsibility was not very clear. Labour made good individual pledges in this year’s election, largely those that emphasised intervention into failing markets, but they were lost in a media message that focused on the deficit and – lest we forget it, or fall for the line Labour ran an anti-austerity opposition over the past five years – frontbench repetition of the need for cuts.

However, with his interpretation of the panel findings and their early but partial publication, Cruddas leaves himself open to criticism he has already reached a conclusion for his ongoing inquiry.

New MPs urge end to austerity

Ten newly-elected first-time MPs have written to The Guardian at the outset of the leadership election to state that Labour needs to ‘challenge cuts’ and set out an ‘alternative to austerity’ if it is to win back the five million votes lost since 1997.

LETTER:

Having arrived in Westminster as newly-elected Labour MPs after speaking to tens of thousands of voters during our election campaigns, we know how important it is for the future of our Party to move forward with an agenda that best serves the everyday needs of people, families and communities and that is prepared to challenge the notion of austerity and invest in public services.

Labour must now reach out to the five million voters lost since 1997, and those who moved away from Labour in Scotland and elsewhere on 7 May, renewing their hope that politics does matter and Labour is on their side.

As we seek a new leader of the Labour Party, we are needing one who looks forward and will challenge an agenda of cuts, take on the powerful vested interests of big business and will set out an alternative to austerity – not one who will draw back to the ‘New Labour’ creed of the past.

Now is the time Labour needs a leader who’s in tune with the collective aspiration of ordinary people and communities across Britain, meeting the need for secure employment paying decent wages, homes that people can call their own, strong public services back in public hands again and the guarantee of a real apprenticeship or university course with a job at the end of it. From restoring Sure Start to providing dignity and a good standard of living in retirement, these are the aspirations key to real Labour values today and will re-engage people across our country in the years to come.

We look forward to engaging in the debate surrounding the Labour leadership in the weeks ahead to secure our Party as being best able to meet the challenges faced by ordinary people at this time.

SIGNED:

Richard Burgon (Leeds East)

Louise Haigh (Sheffield Heeley)

Harry Harpham (Sheffield Brightside and Hillsborough)

Imran Hussain (Bradford East)

Clive Lewis (Norwich South)

Rebecca Long Bailey (Salford and Eccles)

Rachael Maskell (York Central)

Kate Osamor (Edmonton)

Cat Smith (Lancaster and Fleetwood)

Jo Stevens (Cardiff Central)

Labour should end Osborne’s austerity

George Osborne’s latest Budget includes the threat to implement greater austerity measures in the next Parliament, than has been done in any single year to date. It is important to correctly identify this ferocious plan.

The average annual change on public sector current expenditure over the course of this Coalition government has been 2.4% (Table 4.18, OBR Economic and Fiscal Outlook) per year. The announced cuts for 2015-16, starting ahead of May’s election, were somewhat lighter at 1.4% but in the next two financial years following that, 2016-17 and 2017-18 Osborne has pencilled in cuts of 5.8% and 5.4% respectively.

These are ferocious cuts and Osborne for electoral reasons refuses to identify where they will be delivered. He may also struggle to identify them economically and politically – the low-hanging fruit of ‘easy cuts’ such as the switch from RPI to CPI have already been made.

Osborne’s planned cuts represent a significant threat to the living standards of the overwhelming majority in Britain and should be opposed at every turn.

But there is also a confusion that has been introduced following the commentary from the Institute for Fiscal Studies who said, ‘Our latest estimates suggest that Labour would be able to meet its fiscal targets with no cuts at all after 2015-16.’

This arises because the assessment of the budget deficit is slightly better going forward and because Labour has made less onerous pledges on the deficit, and has not copied the Tories’ disastrous intention to cut public investment even further.

But this still means that the current intention is to match Tory plans in 2015/16, which are further cuts of  1.4% in current public spending in the 2015-16 financial year, beginning this week.

The IFS assessment is itself based on a key fallacy promoted by all supporters of austerity. In effect, they argue that cuts work. But they do not. Osborne said he would have eliminated the ‘structural deficit’ by now and be close to eliminating the actual deficit. But the OBR says the deficit will be £90bn in this financial year.

The Tories inherited a deficit of £153bn because of the crisis. But the fall in the deficit has almost nothing to do with austerity policies. Of the total £63bn decline in the deficit the overwhelming bulk has come from falling debt interest payments and the cuts to public sector investment. The former is a product of global economic weakness and QE, while no-one, not even government ministers argue that cutting investment will provide an economic benefit (and are not strictly part of austerity, which is meant to focus on government current spending).  Only £10bn of the fall in the deficit arises from austerity measures, just £2bn a year.

A Labour government implementing milder, less extreme austerity measures would quickly find the same result as the extremist Tories; that the cuts are not leading to a lower deficit because they produce renewed economic weakness. It is simply that the effect would be milder. If the priority is the deficit and the instrument is cuts, Labour will find itself returning again and again to cuts.

The confusion on this matter seems to be nearing an extreme with lawyerly arguments that Labour is not going to implement cuts at all, or that where it is, it is only because they are inescapable under the pressure of the fiscal timetable. This is nonsense.

Osborne will not implement any measures ahead of May 7th for fear of the voters learning about them. Labour could take a leaf out of the Tory book, and have an ‘emergency budget’ in June to revive the economy through increased investment and a drive to lift living standards.

To take just one example, the British government can now borrow for 10 years at interest rates of less than 1.5%. At the same time the OECD estimates that the public return to investment in tertiary education is 35%. The government could literally borrow to expand higher education, grow the economy and reduce the deficit at the same time.

The same logical applies to a host of economic sectors. Austerity is not just bad politics, limiting Labour’s advantage over the Tories it is also very bad economics. Breaking with it would not only ensure a Labour majority government but also produce a genuine recovery that lifts living standards for the overwhelming majority.

 

By Michael Burke