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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There are risks as well as opportunities ahead for George Osborne

The Chancellor is in a tight spot, but expect his political wiles to be on full display, says Spencer Thompson.

The most significant fiscal event of this parliament will take place in late November, when the Chancellor presents the spending review setting out his plans for funding government departments over the next four years. This week, across Whitehall and up and down the country, ministers, lobbyists, advocacy groups and town halls are busily finalising their pitches ahead of Friday’s deadline for submissions to the review

It is difficult to overstate the challenge faced by the Chancellor. Under his current spending forecast and planned protections for the NHS, schools, defence and international aid spending, other areas of government will need to be cut by 16.4 per cent in real terms between 2015/16 and 2019/20. Focusing on services spending outside of protected areas, the cumulative cut will reach 26.5 per cent. Despite this, the Chancellor nonetheless has significant room for manoeuvre.

Firstly, under plans unveiled at the budget, the government intends to expand capital investment significantly in both 2018-19 and 2019-20. Over the last parliament capital spending was cut by around a quarter, but between now and 2019-20 it will grow by almost 20 per cent. How this growth in spending should be distributed across departments and between investment projects should be at the heart of the spending review.

In a paper published on Monday, we highlighted three urgent priorities for any additional capital spending: re-balancing transport investment away from London and the greater South East towards the North of England, a £2bn per year boost in public spending on housebuilding, and £1bn of extra investment per year in energy efficiency improvements for fuel-poor households.

Secondly, despite the tough fiscal environment, the Chancellor has the scope to fund a range of areas of policy in dire need of extra resources. These include social care, where rising costs at a time of falling resources are set to generate a severe funding squeeze for local government, 16-19 education, where many 6th-form and FE colleges are at risk of great financial difficulty, and funding a guaranteed paid job for young people in long-term unemployment. Our paper suggests a range of options for how to put these and other areas of policy on a sustainable funding footing.

There is a political angle to this as well. The Conservatives are keen to be seen as a party representing all working people, as shown by the "blue-collar Conservatism" agenda. In addition, the spending review offers the Conservative party the opportunity to return to ‘Compassionate Conservatism’ as a going concern.  If they are truly serious about being seen in this light, this should be reflected in a social investment agenda pursued through the spending review that promotes employment and secures a future for public services outside the NHS and schools.

This will come at a cost, however. In our paper, we show how the Chancellor could fund our package of proposed policies without increasing the pain on other areas of government, while remaining consistent with the government’s fiscal rules that require him to reach a surplus on overall government borrowing by 2019-20. We do not agree that the Government needs to reach a surplus in that year. But given this target wont be scrapped ahead of the spending review, we suggest that he should target a slightly lower surplus in 2019/20 of £7bn, with the deficit the year before being £2bn higher. In addition, we propose several revenue-raising measures in line with recent government tax policy that together would unlock an additional £5bn of resource for government departments.

Make no mistake, this will be a tough settlement for government departments and for public services. But the Chancellor does have a range of options open as he plans the upcoming spending review. Expect his reputation as a highly political Chancellor to be on full display.

Spencer Thompson is economic analyst at IPPR