Before Ed Miliband announced his plan to freeze energy prices for 20 months from May 2015, he and his aides knew that it would “be big”. They had long been struck by polling showing that rising gas and electricity bills were voters’ primary concern, ranked above wages, employment and housing. But even they have been surprised by the extent to which the policy has defined political debate since the conference season. To Labour’s satisfaction, the Tories have yet to settle on a consistent line of attack, unsure whether to dismiss it as a “gimmick” or as dangerously “left-wing”, or to match it in some form.
The policy was devised by Greg Beales (named “Mr Freeze” by his colleagues), Miliband’s director of strategy and planning, who had long urged the party to shift its focus away from the macroeconomy towards living standards. It was a reorientation inspired by Barack Obama’s 2012 election campaign. In meetings with Labour, Obama aides including his pollster Joel Benenson emphasised how important the president’s stance on living standards had been to victory in tough times. A report on the election by the veteran Democrat Stan Greenberg for Miliband pointed to polls showing that while Mitt Romney had led on “handling the economy” and “reducing the federal budget deficit”, Obama had led on understanding “the economic problems ordinary people in this country are having” and on “looking out for the middle class”.
This left-right split is mirrored in the UK, where a recent ComRes poll found that voters think the Conservatives (42 per cent) are more likely than Labour (33 per cent) to maintain economic growth and keep public spending under control (47 per cent to Labour’s 28 per cent), but also that they believe their own family would be better off under Labour (41 per cent to the Tories’ 31 per cent).
Labour is confident this trend will favour it in 2015. As the economy enters a post-crisis phase, voters are becoming less concerned with macro issues and more concerned with whether their family is sharing in the proceeds of growth.
After missing his original target of eliminating the structural deficit in one parliament, George Osborne has sought to turn economic failure into political success by emulating Obama’s 2012 campaign message and urging voters to let him “finish the job”. He has failed to recognise that Obama was referring not to government borrowing but to living standards. As for the warning “not to give the keys to the guys who crashed the car in the first place” – also inspired by the US president – a Labour aide told me that Obama “actually ran on that line in the 2010 midterms and it was a disaster”.
The Tories have derided Miliband’s focus on the “cost of living” as a distraction from “fixing” the economy, but this message is ill suited to a time when 11 million in Britain have had no increase in real earnings since 2003. Aware of this, the Tories are preparing a barrage of cost-of-living measures for the Autumn Statement but, more than at any other point since 2010, they will be forced to fight on enemy territory.
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