Labour needs an argument about the state not just the deficit

It's time to start a blunter conversation about tax and spending choices.

Following last week's media storm about the season's new East-end duo, Abbott and Glasman, the real business of politics will get back underway this week. And if the weekend's reports are anything to go by it will see Labour moving to a more muscular position, or at least tone, on deficit reduction.

The new year strategy is set to play down the importance of spending levels to the next phase of centre left politics as it talks up other routes to social justice. "We can't spend our way to the new economy", as Ed Miliband likes to say. The intellectual effort required by Labour to carve out what it sees as a progressive austerity agenda will be every bit as demanding as that required in the 1990s to reclaim fiscal prudence. But in the end the politics of tax and spend won't go away, it never does. It will just return in new form.

The pressure for more fiscal resolve over the longer term is reinforced by a mood among Labour strategists that they have so far failed to turn the coalition's Autumn statement, with its admission that cuts will extend into the next parliament, into a new chapter in the debate on the deficit in which Labour gains credit and then moves beyond a sole reliance on its immediate "too far, too fast" critique.

The risk is that the Labour leadership now moves from talking about the short-term case for stimulus to talking about longer term deficit reduction without yet having a strategic account of what this would mean for the state: what it should do less of, more of, and differently, given the realities of the next decade and beyond.

There needs to be synchronicity between its position on the deficit and the underlying willingness to see through the hard politics of shifting ground on spending and tax. There will be no prizes for sounding more hawkish in the abstract and dovish when it comes to specifics.

Opposition is always a precarious balancing act. Between flashes of resolve on the one hand and the need to retain maximum flexibility to respond to events on the other. Between proving your relevance in the here and now via tactical raids and effective protest, and nurturing the belief that you are ripening as a governing proposition, cultivating ideas and attitudes that will chime with the needs of the next era.

And the little that we can glean about the times that lie ahead is that they are going to be very lean yet laden with new challenges. Once we emerge from the nasty decade we are now living through we will soon be bumping into the towering fiscal cost of an ageing society (read this OBR report to get a sense of the scale).

Any party that wants to win in 2015 with a claim to the future will have no choice other than to speak directly to challenges like these.

All of which reinforces the view that a far bigger and blunter conversation about future choices is needed than the one that Labour has so far embarked upon with the public.

What does a plausible Labour cuts agenda look like for 2015; what are real priorities for the future where Labour should seek to increase investment; and what does a Labour tax agenda for 2015-2020 look like?

There will of course be many views and no easy answers. But some answers are certainly easier and better than others. And though Labour certainly shouldn't be coming up with lots of detailed policies this far ahead of an election, nor should it fail to set out some clear directions of travel.

My own view is that there is a principled and progressive set of arguments that could be made about how the state should change its role in important ways.

It could, for instance, offer less generous support for affluent baby boomers in terms of universal benefits at the same time as it puts in place a proper Dilnot-esque system of social care, overwhelmingly paid for by the ageing generation itself rather than their working age counterparts.

It could invest far more in childcare supporting more women to work, raising family living standards, and spreading opportunity; and far less in supporting the most affluent in our society to build up larger pensions. It could invest more in growth-enhancing capital investment and new housing even if this means a longer era of low or no growth in current expenditure.

I don't suggest these changes alone are up to the scale of the challenge faced -- indeed, I know for sure they're not. Nor do I downplay the scale of the political problem in attempting even these sorts of changes; there will be plenty of heartfelt opposition.

But it is possible to make a start.

Despite sweeping and brutal cuts targeted at low-and-middle income families the coalition has gone out of its way to protect some large areas of less essential spending, meaning the first £10bn of spending re-prioritisation shouldn't be that hard to find (beyond that things get dramatically tougher).

If Labour can't muster the resolve to consider these shifts -- or alternative ones conjured by wiser minds -- I suspect it isn't going to persuade a sceptical public that it is distinctive or has what it takes to govern in the tough decade ahead. The alternative is a slide towards a soggy, cautious politics in which it feels boxed in by a left that cries "betrayal" in response to any proposed cut, and a right that screams "deficit denial" at any new consideration of collective action.

Nor should this all be about re-balancing spending. Labour needs its own distinctive account on tax. Part of this should be leading a genuinely open and far-reaching debate about what a resilient 21st century tax-base should look like, as Nick Pearce says, one better able to withstand global shocks than was the case in 2008.

Equally, it should be identifying new and progressive sources of revenue that can help support fresh needs.

To take one example, it remains something of a mystery why Labour has opted to cede the rhetorical argument about taxing wealth and property to the Lib Dems.

Any new property tax will of course be fiendishly hard to design in a way that raises serious money without being politically toxic (as the person who tried and failed to get the Blair government to reform council tax so it raised more from high-end properties I know how not to do this). All the more reason for Labour to be getting on with this hard work now rather than leaving it to others.

Yet all these longer-term policy dilemmas are overshadowed by a larger political, even emotional, challenge which will require a whole generation of Labour figures to change -- unlearn -- how they practice politics.

During the Blair-Brown era of steadily rising public expenditure, it was possible to thrive by hugging close lots of competing groups and sub-sections of the electorate. The young and the old; parents -- both working and stay-at-home; the head teacher and teaching assistant; the hospital consultant and nursing assistant. They all benefited. There were, of course, noisy battles about reform, but even the bitterest row was soothed by the salve of higher spending.

Today's Labour leadership has, perhaps not surprisingly, been caught between the realisation that this model of politics is over and an instinctive reluctance to embark on the new and far harder course -- one which accepts, sooner or later, the need for clarity about who will be the winners and losers from Labour's fiscal decisions, and the need to build widespread public consent for these choices.

This is a scary transition to make. Outraged representatives of the groups who feel let down will appear on our TV screens. It's tough to handle this in government, harder still when in opposition with few friends.

But until Labour makes this mental shift it will continue to be pushed into a largely defensive posture; defined more by its opponents than by its own positive choices.

That is a position it must break out of long before the curtain falls on 2012.

 

Gavin Kelly is the chief executive of the Resolution Foundation.

Gavin Kelly is chief executive of the Resolution Foundation 

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Our treatment of today's refugees harks back to Europe's darkest hour

We mustn't forget the lessons of the Second World War in the face of today's refugee crisis, says Molly Scott Cato.

In the 1930s, thousands of persecuted people fled Europe. Our own press ignominiously reported these as "Stateless Jews pouring into this country" and various records exist from that time of public officials reassuring readers that no such thing would be allowed under their watch.

With the benefit of historical hindsight we now know what fate awaited many of those Jews who were turned away from sanctuary. Quite rightly, we now express horror about the Holocaust, an iconic example of the most shocking event of human history, and pledge ourselves to stop anything like it happening again. 

Yet as Europe faces its worst refugee crisis since the Second World War we are witnessing a deafening cacophony of xenophobic voices in response to people fleeing their own present-day horror. We must therefore reflect on whether there is an uncomfortable parallel in the language being used to describe those seeking asylum today and the language used to describe Jews seeking refuge in the 1930s.

Our response to the current refugee crisis suggests we feel fearful and threatened by the mass movement of desperate people; fearful not just of sharing what we have but also of the sense of disorganisation and chaos. Does the fact that these refugees are from Syria, Libya, Iraq and Afghanistan, and so not part of our continent, provide an excuse to allow them to be bombed at home or drowned during their desperate journey to safety?

We are not helped by the poorly informed public debate which—perhaps intentionally—conflates three quite different movements of people: free movement within the EU, irregular or unauthorised migration and the plight of the Middle Eastern refugees. While our misguided foreign policy and unwillingness to tackle change may give us a moral responsibility for those fleeing famine and conflict, our responsibility towards refugees from war zones is clear under international law.

Due to our commitments to the UN Refugee Convention, the vast majority of Syrian refugees who reach our territory are given asylum but the UK has taken fewer Syrian refugees than many other European countries. While Germany admitted around 41,000 asylum-seekers in 2014 alone, the UK has taken in fewer than 7000.

The problem is that any sense of compassion we feel conflicts with our perception of the economic constraints we face. In spite of being the fifth largest economy in the world we feel poor and austerity makes us feel insecure. However, when actually confronted with people in crisis our humanity can come to the fore. A friend who spent her holiday in Greece told me that she saw local people who are themselves facing real poverty sharing what they had with the thousands of refugees arriving from Turkey.

A straightforward response to the growing sense of global crisis would be to restore the authority of the UN in managing global conflict, a role fatally undermined by Tony Blair's decision to go to war in Iraq. Our role should be to support UN efforts in bringing about strong governments in the region, not taking the misguided ‘coalition of the willing’ route and running foreign policy based on self-interest and driven by the demands of the oil and arms industries.

We also need EU policy-makers to show leadership in terms of solidarity: to co-operate over the acceptance of refugees and finding them safe routes into asylum, something the European Greens have consistently argued for. The EU Commission and Parliament are in clear agreement about the need for fixed quotas for member states, a plan that is being jeopardised by national government’s responding to right-wing rather than compassionate forces in their own countries.

Refugees from war-torn countries of the Middle East need asylum on a temporary basis, until the countries they call home can re-establish security and guarantee freedom from oppression.

The responsibility of protecting refugees is not being shared fairly and I would appeal to the British people to recall our proud history of offering asylum. Without the benefit of mass media, the excuse of ignorance that can help to explain our failure to act in the 1930s is not available today. We must not repeat the mistakes of that time in the context of today’s crisis, mistakes which led to the deaths of so many Jews in the Nazi death camps. 

Molly Scott Cato is Green MEP for the South West of England.

Molly Scott Cato is Green MEP for the southwest of England, elected in May 2014. She has published widely, particularly on issues related to green economics. Molly was formerly Professor of Strategy and Sustainability at the University of Roehampton.