News International's problem is now Cameron's problem.

Employing and then losing Andy Coulson illustrates the Prime Minister's worst flaws.

You're in favour of abolishing the monarchy and have probably done it more damage than anyone since Cromwell. You despise the class-ridden nature of contemporary Britain. And you played a central role in Labour's three crushing general election victories, supporting the party in every poll between 1997 and 2005. But still the left hates you. So who can you be? None other than Rupert Murdoch, who's in a bit of trouble. Not his fault, of course – how was he supposed to know what his bestselling newspaper was getting up to during that brief period when one rogue individual was getting up to whatever it was? Why on earth would Rupert have paid attention to that, then or since?

No, all this has obviously come as a vast shock and has, right now, right in the middle of this pesky Sky bid referral business, just this moment come as a shock to Murdoch. But while there is absolutely no possibility that the owner of the News of the World is in any way personally culpable for what his paper did; David Cameron can't escape responsibility for his sins of commission in quite the same way. For employing and then losing Andy Coulson illustrates all the Prime Minister's worst flaws and promises plenty more harm to come.

The first thing that needs to be said about the phone-hacking scandal is that the internet has had nothing to do with it. This has been a story that has been kept alive by antique media, being almost entirely the work of the Guardian and the BBC. (Though perhaps that gladdens Rupert's romantic heart?) It's hard for Tories like me who fall into the "shut it down" rather than the "sell it off" camp, as far as the BBC's concerned, to face up to what it would have meant if the corporation hadn't existed. Fleet Street is so compromised by its own relationship with the police, past and present, that it hasn't been willing to give any heft to this story, if it can avoid doing so. It took the BBC to make this story -- and all those Tory flacks who screamed that there wasn't one here are discreditable fools. But for all that Murdoch is the real story, it's the Andy Coulson chapter that tells us a depressingly large amount about the Tory party that Cameron leads.

Even in the manner of his departure, Coulson reminded us, and more pointedly, the Prime Minister, what sort of man he is: "I've kept a diary!" being one of the century's most unsubtle threats thus far. When Cameron made him his spin doctor, immediately in the wake of the first elements of the News of the World scandal emerging, plenty of Tories shook their head.

Cynics wondered about the practicality of the second chance being offered, and whether it would end in tears, while traditionalists simply wondered what the leader of the Tory party was doing giving hundreds of thousands of pounds to man who ran front page after front page attacking and undermining the royal family. However modern the party was, it surely didn't need to be quite that modern? But how those monarchy-knocking stories came to be on Coulson's front page has come back to bite Coulson and Cameron good and hard.

One of the problems with the left is that, at root, you just don't respect the right: you think we're absurd, unreasonable, dishonest, or merely dim. Thus if you read that pro-monarchical sentiment motivated some of the people who were right when David Cameron was so very wrong, you either don't believe it, or you laugh it off as being risible. Yet, it was taking on the monarchy that was the step too far even for News International.

Hacking into the phones of royalty obliged an intimidated Met to act and that's what has set in train the greatest challenge Murdoch's empire has ever faced in Britain. It's certainly getting a far harder time than it ever got during any of those three parliaments, with their massive Labour majorities, for which Rupert had his papers campaign. You really might want to consider standing up for "God Save the Queen" the next time you hear it, as the press regime isn't anywhere as nice.

Who can blame the police for their reticence? When they arrested Damian Green for being in receipt of the contents of ministerial safes, because one lone civil servant felt he knew best where those contents should be, who stood up for them then? Partisan, Cameron-cheerleading Tories frothed at the mouth and disgraced themselves by calling the police "Nazis". And the liberal left wasn't exactly vocal in its defence of John Yates et al, either.

Having been burned by that experience, and after the frustrations of having to accept that no crime had been committed under the inadequate laws that provided for the cash-for-honours investigation, who exactly were the Met to look at for help in taking on any element of our sacred free press? Labour? Even today Ed Miliband can't wait to assure Rupert that he'll come running, should he ever be called.

Labour's ongoing fear of Murdoch was amply demonstrated by PMQs this week. Only the heroic Tom Watson stood up and asked a question about the phone-hacking scandal. The leader of the opposition certainly didn't feel the need to waste any of his questions asking, oh, "Did the Prime Minister discuss News International or any of its subsidiaries when he secretly met James Murdoch and Rebekah Brooks in the immediate wake of Cablegate?" Even though, thanks to the Independent, we know that Cameron's I've-always-got-away-with-it arrogance is so colossal that he willingly ran the risk of his conclave emerging last year, in the heat of Cablegate.

There's a school of thought, exemplified by the Telegraph's Charles Moore, that says that Cameron is an admirably cold-blooded, sure-footed master of business. In short, a grown-up who knows how things are done. If only. Anyone whose judgement is so poor that they go to a meeting like this merely confirms everything that went into his mistake in appointing Coulson in the first place.

The new Tory comfort-blog about Cameron's serial incompetence is that, with Coulson gone, the story goes away as a problem for the Prime Minister. But it's the opposite that's true: precisely because Cameron needlessly drew Coulson into his inner circle, every subsequent eruption from News International is now going to rain down on No 10, too. And if last week shows nothing else, there's plenty more hot stuff to come.

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The future of the left: The path ahead is full of challenges

Be in no doubt: the left faces a struggle for survival.

There are plenty of grounds for pessimism about the left’s prospects and they are well rehearsed.  Across Europe, social democrats are out of power and when they do manage to enter government, it is under the skirts of dominant centre-right parties or at the helm of fragile coalitions. Ageing western societies have become more conservative, immigration has driven a cultural wedge into the cross-class coalitions that once undergirded centre-left voting blocs, and austerity has ushered in a politics of security, not reform. Only those who have borne the brunt of the financial crisis and its aftermath, like the unemployed youth and evicted homeowners of Southern Europe, have swung decisively to the left, joined by relatively protected but angry older middle class liberals of Northern Europe. Even in Latin America, where the left swept the board at the turn of the century, politics is shifting to the right. Bright spots, such as municipal experimentalism in Spanish cities, or energetic liberalism in Canada and Italy, illuminate the gloom. But mostly, darkness is visible.

Is this condition terminal? Inequality, stagnant living standards and the turbulence of global capitalism generate profound political discontent. They give oxygen to progressive protest movements as well as populist reactionaries, as the convulsions in US politics show. But only a facile determinism reads off political progress from economic crisis. There is nothing to guarantee that revulsion at political and economic elites will give birth to a new egalitarianism. The left needs a clearer headed view of the political terrain that it will face in the 2020s.

Demographic change is a given. Advanced democracies like Britain will get older and the weight of older voters in elections will increase, not diminish. The gap in turnout rates between young and old is unlikely to close, tilting politics even further towards the cultural concerns and economic interests of the over fifties. Leadership credentials and economic competence matter for these voters more than abstract appeals to equality. But a generation of young people will also enter middle age in the 2020s having endured the worst of the age of austerity, with lower wages, stymied home ownership aspirations and stunted career progression to show for it. So just as 20th century catch-all parties built cross-class electoral alliances, successful political movements in the coming decades will need to secure inter-generational voting blocs. Stitching these together will foreground the politics of family and focus policy attention on transfers of wealth and opportunity across multiple generations. 

Ageing will also ratchet up fiscal pressures on the state, as costs mount for the NHS, care of the elderly and pensions. But Britain’s tax base has been weakened by low productivity, corporate tax avoidance and expensive personal allowance giveaways. In the 2020s, this crunch will loom large over fiscal policy and force hard choices over priorities. Just as in the 1990s, we can expect public disquiet at the run-down of investment in public services to mount, but this time there won’t be the same spending headroom to respond to it. The political debate currently underway in Scotland about raising income tax is therefore a harbinger of the future for the rest of the UK.

Fiscal constraints will also force the left to take seriously the agenda of economic reform opened up under the ungainly title of “pre-distribution”. Without an account of how to generate and share prosperity more equitably within the market economy, social democracy is purposeless. But it will need a far more robust and plausible political strategy for achieving these ambitions than anything that has been on offer hitherto. Technological change will not usher in a new economy of its own accord, and without the solid base of an organised working class to ground its politics, the left needs to be open to a wide set of alliances with businesses, big and small. Combining economic radicalism with credibility and popular appeal, particularly to voters who still blame it for the financial crisis, is the hardest challenge the left faces, but there is no getting away from it.

On a note of optimism, the left is currently strong in cities, from which it can build out. Diversity is a strength in major urban centres, not a weakness, and powerful city leaders endow progressive politics with governing authority. Cities are the places where new social movements are most active and much of the energy of contemporary politics can be found, even if elections are fought on wider terrain. The task is to combine a propensity to decentralise and devolve with clear national political direction. The same holds with party reform: the mass political parties of the 20th century are dead, but networks can’t fight elections, so combining openness and democratic engagement, with discipline and national purpose, is vital. 

Nick Pearce is the director of the Institute for Public Policy Research.