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Blears: Tough times

  • Posted by Hazel Blears
  • 19 September 2008

It seems clearer every day the Chancellor’s assessment of the trajectory of the world economy was correct - we need to show the country we're addressing the challenges

The Labour Party meets in Manchester this week against a turbulent economic backcloth. Most people will be watching the news and reading the paper with a growing sense of anxiety about their jobs, mortgages, and savings. People know that food and petrol cost more than a few months ago. They will be worried about the bills, with Christmas around the corner. It seems clearer every day that the Chancellor’s assessment of the trajectory of the world economy was correct. We are heading into some really tough times.

So the big task for Labour is to show the country that we are addressing the economic challenges. We’ve laid the right foundations, with low interest rates, historically low levels of government debt, and high employment. We can show that national governments can make a difference, even in the face of seismic global events. People don’t expect governments to be able to work miracles; but they don’t expect governments to twiddle their thumbs and leave everything to the market. So Alistair Darling’s speech on Monday will be as significant as the Prime Minister’s on Tuesday. People will be rightly watching both with huge interest.

I am delighted that we are back in Manchester for Labour conference. Manchester is such a strong symbol of what a Labour Government and Labour council can achieve together. The local leadership in Manchester have shown real vision over the past decade, and it has paid off. There’s a buzz about Manchester, whether it is the vibrancy of Canal Street and the Curry Mile, the awe-inspiring Beetham Tower, or the creativity and entrepreneurialism of the Northern Quarter. It feels so different from the Tory years, and the boarded-up shops, unemployed youngsters, and flight to the suburbs which hollowed out the city centre.

So we must take on the Tories. It is clear that their strategy is to move onto the centre ground, and mirror Labour. But underneath the gloss are the same old right-wing Tories, with their agenda of cuts to public services and the voluntary sector. Just as the Tory conferences in the 1980s were ruthlessly focussed on trashing Labour’s leaders and policies, so we need to target Cameron, Osborne and the rest. Our week in Manchester should aim to put the Tories under the microscope, and reveal to the world whatever bacillus is crawling around.

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12 comments from readers

James
19 September 2008 at 12:10

"We can show that national governments can make a difference, even in the face of seismic global events... we need to target Cameron, Osborne and the rest."

A tad inconsistent there Hazel. On the one hand you say that in these times call for quantitive policy then you go on to ramble about facades such as the Betham Tower before calling for some focused realpolitik sniping. What can we actually draw from this?

Surely to address what are global economic challenges any national government will start talking about global political economic solutions. A number of things in the past few days have pointed the way. A historicallly unprecedented co-ordinated action on the part of central banks should surely spark some transnational dialouge about what else could be addressed at such levels. This is an international crisis that makes South Ossestia look like a side show. Where are the calls for political economic discussion on the global stage so that some of the measures the Fed, the ECB and the BofE have put in place over the last few days can have wider and more certain outcomes?

Any government that put forward such an agenda would be bringing actual policy to the table. Pointing back to a period prior to the crisis, streets full of low-end curry houses and plummeting in value skyscrapers is not policy. Nor is blaming the other guys.

timothy moriarty
19 September 2008 at 13:37

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antileft
19 September 2008 at 16:25

Is anyone else worried that such a woman is involved with writing our laws?

Carl Jones
19 September 2008 at 16:25

Vote in the US election? Its pointless with NWO nerds hacking into the Diabold voting machines.LOL

Carl Jones
19 September 2008 at 16:29

antileft; I`m more worried about an Act of Parilament which allows a Minister to amend and write new laws as they see fit.lol

Roland Baker
19 September 2008 at 20:38

"...the Chancellor’s assessment of the trajectory of the world economy was correct. We are heading into some really tough times." Mrs Blears should not speak outside her brief. I thought his assessment was that we were well placed to weather the recession, particularly as he was personally responsible for the economy.

Low interest rates and low government debt? Was that before LIBOR ricocheted off base rate and entered low earth orbit in a trading range around 600 basis points? Was that before we were risking at least £30 billion on Northern Rock and then we injected further liquidity into financial markets?

High employment? Unemployment is now 1.72 million, about 5% of the work force. It was heading for 2 million, about 6% of the workforce, before the recent consolidation of banks in financial services. You can't even get through on the 'phone to any recruitment agency in London if you hang on for an hour.

People have lost their jobs because the Prime Minister put no system of financial regulation in place when he was Chancellor. They won't appreciate your trashing Tory policies when Purnell's alternative is to rob their pensions and march them up the high street in orange suits on work parties for dole money.

physiocrat
19 September 2008 at 20:47

I wish the government was addressing the challenges but it is not. The tax system is fundamentally dysfunctional and Labour has done nothing to address the problem. UK taxation continues to be nothing more than a structure of fines and penalties for successfully engaging in legal economic activity. That is not socialist, or social democratic, or socialist-moved-to-the right. It is just stupid. Matters are made worse because all three parties connive in leaving things as they are, apart from a bit of tinkering.

What is stupid about the tax system? When windows were taxed, the result was bricked-up windows. Taxes on tobacco and alcohol lead to less smoking and drinking, and most people would agree that is probably a good thing. But most taxes are on honest work, and so the predictable result is idleness and crime. The wonder is that matters are not far worse.

There is a viable alternative, and in the early days of the Labour Party, it was an important policy - to replace existing taxes on by an ad valorem tax on the rental value of land (LVT). This was proposed by Henry George 130 years ago but somehow it got dropped during World War II. Had LVT been put in place in the early years of the Blair government, the house price bubble (in reality a land price bubble) and the associated banking collapse would never have happened. Representations were repeatedly made but due to the hermetic nature of the system, the proposal never got past the fresh-faced policy wonks who devise the policies of the political parties.

Labour deserves to lose the election because of its negligence and complacency, but the country does not deserve the Conservatives. Or perhaps it does.

Land Value Taxation Campaign

http://www.landvaluetax.org

Labour Land Campaign

http://www.labourland.org

fairplay
21 September 2008 at 08:42

antileft

the chubby brown of the new statesman comment pages

long may it continue!!!!

antileft
21 September 2008 at 11:32

Very intelletual, fairplay. Get back to tv and beer. Join Nilsey.

Mirto
21 September 2008 at 17:33

What puzzles me is that a dynamic government that is 'doing' so much to stem this crisis of 'moral hazard' has done absolutely nothing about it.

Whilst our esteemed PM was the Chancellor he predicted this fallout but what did he do?- NOTHING.

The crux of the problems are with the banks and housing.

So let us take a look. Banks rocketed the housing market to ridiculous levels because they were allowed to do so by the PM.

Why? Mortgages were only available to those with salaries to support such a purchase taken on 3 and a half times one's salary. This system has worked very well through the last couple of hundred years and Gordon Brown allowed this to be changed. So much for 'prudence'.

Basic economics will tell us that borrowing at 6 times salary or more is not sustainable and to some borrowers even higher multiples. Where and what was the Chancellor doing when the high street decided this was a viable alternative form of 'Risk management'?

The housing bubble would never have got so large if the market had continued to practice the trusted system. There would have been a natural top to the market as the salary would have limited growth also Loan to Asset values.

So why did you put us all into this depression when you say you knew 'bad times' were coming? Why did you sit back and extol the 'end of boom and bust'. When you should have been cracking down on poor lending practices?

So you want to know why the public do not want to vote for you at the next general election? Because you have failed in your duty to protect society and the public.

The mess you have created requires bold and imaginative solutions and the Liberal Democrats have the correct idea.

Returning money to those that will spend it to live on in this depression will give a sound basis for recovery. The public can not take anymore taxes- they can not eat properly let alone pay more taxes.

By not taxing those that will not spend the money you are looking at lost revenue as a government. You fail in this department too.

If businessmen want to do business in the UK then they should register thier company in the UK. If not do not allow them the freedom to trade in our market- they have a duty to pay their taxes fairly too.

Listen the public can NOT afford more taxes and that is where you are 'out of touch'.

cat osb
22 September 2008 at 16:01

To talk of "historically low levels of government debt" is untrue. To talk of "low interest rates" ignores the fact that low interest rates are partly responsible for the present debacle on the financial markets.

fairplay
23 September 2008 at 06:17

So let us take a look. Banks rocketed the housing market to ridiculous levels because they were allowed to do so by the PM.

Why? Mortgages were only available to those with salaries to support such a purchase taken on 3 and a half times one's salary. This system has worked very well through the last couple of hundred years and Gordon Brown allowed this to be changed. So much for 'prudence'.

i think the fact that the banks are in control of everything and everybody may have something to do with it. decisions affecting the population arent made in downing st. they are made by a select few wealthy banking families and brown and most other western leaders "sell" their ideals to the public.

the fact that these clown MPs sit on the boards of blue chip companies in their twilight years on massive salaries after their momentus cock ups in parliament, shows to some extent where the real power lies. they are all on the gravy train and the bankers are the station masters

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About the writer

Hazel Blears

Hazel Blears is MP for Salford, and Secretary of State for Communities and Local Government. She has served as Chair of the Labour Party, as Home Office Minister, and as Public Health Minister.

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