Michael Foot: RIP

Some of his much-mocked policies remain relevant even in the 21st century.

The former Labour leader Michael Foot has died at the age of 96. He was a brilliant man, a prolific writer (and a former New Statesman journalist), a natural orator and a legendary if infamously unsuccessful leader of the Labour Party. Oh, and he was also a devoted Plymouth Argyle fan and the oldest registered professional player to date in the history of football. (Here's a link to some related New Statesman profiles, interviews and stories.)

Personally, I can't help but agree with Craig Murray, writing on his blog in May 2009:

The sad thing is that Michael Foot was perhaps the most honourable man ever to lead a major political party in this country. Foot would never have dreamed of milking his MP's allowances, or letting anyone else do so. It is totally inconceivable that Foot would have tolerated creatures like McBride and Draper around him. He was not in politics for backstabbing and smear.

The irony is that it was Foot's innocence of the dark arts we now deplore in politicians, that led to his extreme unpopularity. He deliberately and consciously abjured the media soundbite, in favour of the well-made and complete argument that did not fit in a news bulletin.

He absolutely refused image makeover. I remember very well that this came to a head when he arrived at a cold Remembrance Day at the Cenotaph wearing a duffel coat. The Murdoch press went crazy, calling it a "donkey jacket". It was at the time as big a media sensation as the MPs' expenses claims are today.

Foot's political legacy will be much discussed and much disputed in the coming days, but here is the architect of "New" Labour himself, Anthony Charles Lynton Blair, speaking about him at the Labour party conference in 1997, shortly after coming to power:

Thank you to the Party organisation, the volunteers, the professionals who fashioned the finest political fighting machine anywhere in the world. And thanks to those that led before me . . .

My own debt of honour to Michael Foot: you led this Party when, frankly, it was incapable of being led and without ever losing a shred of your decency or your integrity. Thank you.

Also in the coming days, among the inevitably innumerable profiles, essays and obituaries, you'll hear much about Labour's 1983 general election defeat under Foot and his "crazy" left-wing election manifesto, often described as "the longest suicide note in history" (copyright: Gerald Kaufman).

But here's a thought experiment. Read this extract from the 1983 election manifesto, from the "Finance for Industry" section:

It is essential that industry has the finance it needs to support our plans for increased investment. Our proposals are set out in full in our Conference statement, The Financial Institutions. We will:

* Establish a National Investment Bank to put new resources from private institutions and from the government -- including North Sea oil revenues -- on a large scale into our industrial priorities. The bank will attract and channel savings, by agreement, in a way that guarantees these savings and improves the quality of investment in the UK.
* Exercise, through the Bank of England, much closer direct control over bank lending. Agreed development plans will be concluded with the banks and other financial institutions.
* Create a public bank operating through post offices, by merging the National Girobank, National Savings Bank and the Paymaster General's Office.
* Set up a Securities Commission to regulate the institutions and markets of the City, including Lloyds, within a clear statutory framework.
* Introduce a new Pension Schemes Act to strengthen members' rights in occupational pension schemes, clarify the role of trustees, and give members a right to equal representation, through their trade unions, on controlling bodies of the schemes.
* Set up a tripartite investment monitoring agency to advise trustees and encourage improvements in investment practices and strategies.

We expect the major clearing banks to co-operate with us fully on these reforms, in the national interest. However, should they fail to do so, we shall stand ready to take one or more of them into public ownership. This will not in any way affect the integrity of customers' deposits.

Funny to see "New Labour" Brown and Darling going beyond "Old Labour" Michael Foot and Denis Healey in terms of nationalising the banks, eh? If only it had happened sooner . . . !

Mehdi Hasan is a contributing writer for the New Statesman and the co-author of Ed: The Milibands and the Making of a Labour Leader. He was the New Statesman's senior editor (politics) from 2009-12.

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The Autumn Statement proved it – we need a real alternative to austerity, now

Theresa May’s Tories have missed their chance to rescue the British economy.

After six wasted years of failed Conservative austerity measures, Philip Hammond had the opportunity last month in the Autumn Statement to change course and put in place the economic policies that would deliver greater prosperity, and make sure it was fairly shared.

Instead, he chose to continue with cuts to public services and in-work benefits while failing to deliver the scale of investment needed to secure future prosperity. The sense of betrayal is palpable.

The headline figures are grim. An analysis by the Institute for Fiscal Studies shows that real wages will not recover their 2008 levels even after 2020. The Tories are overseeing a lost decade in earnings that is, in the words Paul Johnson, the director of the IFS, “dreadful” and unprecedented in modern British history.

Meanwhile, the Treasury’s own analysis shows the cuts falling hardest on the poorest 30 per cent of the population. The Office for Budget Responsibility has reported that it expects a £122bn worsening in the public finances over the next five years. Of this, less than half – £59bn – is due to the Tories’ shambolic handling of Brexit. Most of the rest is thanks to their mishandling of the domestic economy.

 

Time to invest

The Tories may think that those people who are “just about managing” are an electoral demographic, but for Labour they are our friends, neighbours and the people we represent. People in all walks of life needed something better from this government, but the Autumn Statement was a betrayal of the hopes that they tried to raise beforehand.

Because the Tories cut when they should have invested, we now have a fundamentally weak economy that is unprepared for the challenges of Brexit. Low investment has meant that instead of installing new machinery, or building the new infrastructure that would support productive high-wage jobs, we have an economy that is more and more dependent on low-productivity, low-paid work. Every hour worked in the US, Germany or France produces on average a third more than an hour of work here.

Labour has different priorities. We will deliver the necessary investment in infrastructure and research funding, and back it up with an industrial strategy that can sustain well-paid, secure jobs in the industries of the future such as renewables. We will fight for Britain’s continued tariff-free access to the single market. We will reverse the tax giveaways to the mega-rich and the giant companies, instead using the money to make sure the NHS and our education system are properly funded. In 2020 we will introduce a real living wage, expected to be £10 an hour, to make sure every job pays a wage you can actually live on. And we will rebuild and transform our economy so no one and no community is left behind.

 

May’s missing alternative

This week, the Bank of England governor, Mark Carney, gave an important speech in which he hit the proverbial nail on the head. He was completely right to point out that societies need to redistribute the gains from trade and technology, and to educate and empower their citizens. We are going through a lost decade of earnings growth, as Carney highlights, and the crisis of productivity will not be solved without major government investment, backed up by an industrial strategy that can deliver growth.

Labour in government is committed to tackling the challenges of rising inequality, low wage growth, and driving up Britain’s productivity growth. But it is becoming clearer each day since Theresa May became Prime Minister that she, like her predecessor, has no credible solutions to the challenges our economy faces.

 

Crisis in Italy

The Italian people have decisively rejected the changes to their constitution proposed by Prime Minister Matteo Renzi, with nearly 60 per cent voting No. The Italian economy has not grown for close to two decades. A succession of governments has attempted to introduce free-market policies, including slashing pensions and undermining rights at work, but these have had little impact.

Renzi wanted extra powers to push through more free-market reforms, but he has now resigned after encountering opposition from across the Italian political spectrum. The absence of growth has left Italian banks with €360bn of loans that are not being repaid. Usually, these debts would be written off, but Italian banks lack the reserves to be able to absorb the losses. They need outside assistance to survive.

 

Bail in or bail out

The oldest bank in the world, Monte dei Paschi di Siena, needs €5bn before the end of the year if it is to avoid collapse. Renzi had arranged a financing deal but this is now under threat. Under new EU rules, governments are not allowed to bail out banks, like in the 2008 crisis. This is intended to protect taxpayers. Instead, bank investors are supposed to take a loss through a “bail-in”.

Unusually, however, Italian bank investors are not only big financial institutions such as insurance companies, but ordinary households. One-third of all Italian bank bonds are held by households, so a bail-in would hit them hard. And should Italy’s banks fail, the danger is that investors will pull money out of banks across Europe, causing further failures. British banks have been reducing their investments in Italy, but concerned UK regulators have asked recently for details of their exposure.

John McDonnell is the shadow chancellor


John McDonnell is Labour MP for Hayes and Harlington and has been shadow chancellor since September 2015. 

This article first appeared in the 08 December 2016 issue of the New Statesman, Brexit to Trump