Is Alan Johnson the right man for the job of shadow chancellor?

The coalition, and the cuts consensus, have to be challenged, not indulged.

I was on Radio 4's World Tonight and BBC2's Newsnight yesterday discussing the appointment of the former home secretary Alan Johnson as the new shadow chancellor. I don't think any of us saw that coming -- in fact, I don't think Alan Johnson saw it coming! When I spoke to him at the Labour party conference in Manchester, he seemed keen to shadow the Deputy Prime Minister, Nick Clegg, and hold the coalition government's constitutional and electoral reform agenda to account. He has never served in the Treasury before and is not an expert on the economy.

Nick Robinson tells the following anecdote on his blog:

I once told Alan Johnson that some in the cabinet were arguing that he should replace Alastair Darling as chancellor. His communication skills, wry good humour and common sense were regarded by many as making him the perfect foil to Gordon Brown and more likely to cheer up the nation up than Darling himself.

I well recall his reaction – he looked like he'd swallowed a wasp. Unlike the other obvious candidate back then – Ed Balls – he had no economic training and was not desperate to do the job.

Regular readers of this blog will know that I was hoping Ed Balls would be made shadow chancellor. I believe he was the best-qualified person for the job – and he deserved it, too, having delivered a scathing critique of Osbornomics at Bloomberg in August, and having harried and humiliated Michael Gove at the despatch box again and again over the summer. I also think it is odd that the two most formidable economists on the Labour front bench should be confined to home affairs (Balls) and foreign affairs (Yvette Cooper), where their impressive grasp of macroconomics will not be needed and where Cooper, in particular, might be wasted.

But what do I know? I'm just a hack. Ed Miliband is the leader and I'm guessing he has a plan. Plus, Johnson is an experienced and able politician, a great communicator with a fantastic sense of humour, as well as a fascinating backstory that contrasts with George Osborne's privileged upbringing.

Now, there has been much debate over the past 24 hours as to whether the Johnson appointment and the decision to deny Balls the post he so craved is a sign of strength or weakness on the part of Miliband. I was on BBC Radio Wales with the former Blair adviser John McTernan this morning: McTernan thinks the new Labour leader showed "strength" in giving Balls the home affairs, rather than the Treasury, brief. Indeed, the narrative emerging from the Blairites is "Ed Mili faced down Ed Balls".

But there is another view that says that Miliband the Younger capitulated to the Blairites and the right-wing press, who like to refer to him as "Red Ed" and to Ed Balls as a "deficit denier", by going with the safe option of Alan Johnson, a supporter of the candidate (Mili-D) who was backed by more Labour MPs than Mili-E was. Kevin Maguire, for example, says:

Ed Miliband's fluffed his first big call. Appointing Alan Johnson as Labour shadow chancellor is to stick with the Alistair Darling line on halving the deficit when Labour lost the election. The bold move was to put Ed Balls or Yvette Cooper in the job and shift the Labour position to slower cuts to keep the economy recovering.

I'm not sure where I stand on this. Perhaps, as I noted in a CIF piece yesterday, the personnel issue is irrelevant and we should all wait to see what Labour's policy response is to George Osborne's Spending Review on 20 October.

Ed Miliband has repeatedly referred to the Alistair Darling plan for deficit reduction (that is to say, halving the deficit over four years) as a "starting point" and told Channel 4 News the day after his conference speech that he'd like to do more with taxation, and less with spending cuts, than Darling had allowed for. Johnson's appointment might be part of a deliberate strategy by Miliband to take charge of the party's economic and, specifically, fiscal policy rather than outsource it to the shadow chancellor/chancellor (as Tony Blair did in the Nineties and Noughties).

It is worth remembering that Miliband taught economics at Harvard during his sabbatical in 2003-2004 and chaired the Treasury's Council of Economic Advisers between 2004 and 2005. Unlike Blair, and perhaps Johnson, he understands economics.

Meanwhile, the coalition's fiscal and welfare policies are in disarray – at the Conservative conference, a cut in child benefit for higher-rate taxpayers to save £1bn was followed by a transferable tax allowance for married couples which will cost £500m! In today's Daily Telegraph, Chris Huhne, the Lib Dem Energy Secretary, says that the proposed spending cuts are not "lashed to the mast" and that it "may be appropriate" to alter the plans in the event of a serious economic downturn. Like Ken Clarke, the Tory Justice Secretary, Huhne also admits that a double-dip recession is a possibility.

So now is not the time for Ed Miliband to go wobbly on deficit reduction. The opposition has to make clear that deep and immediate cuts will make the deficit get bigger, not smaller. And Alan Johnson needs to understand the Keynesian argument, and the "moral" argument – as his preferred leadership candidate, David Miliband, put it during the Compass hustings in June – for running deficits in downturns.

Here are some people Johnson should perhaps try to speak to for advice this week, ahead of the SR on 20 October:

* Paul Krugman

* David Blanchflower

* Anne Pettifor

* Martin Wolf

* Ed Balls :-)

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 11 things we know after the Brexit plan debate

Labour may just have fallen into a trap. 

On Wednesday, both Labour and Tory MPs filed out of the Commons together to back a motion calling on the Prime Minister to commit to publish the government’s Brexit plan before Article 50 is triggered in March 2017. 

The motion was proposed by Labour, but the government agreed to back it after inserting its own amendment calling on MPs to “respect the wishes of the United Kingdom” and adhere to the original timetable. 

With questions on everything from the customs union to the Northern Irish border, it is clear that the Brexit minister David Davis will have a busy Christmas. Meanwhile, his declared intention to stay schtum about the meat of Brexit negotiations for now means the nation has been hanging off every titbit of news, including a snapped memo reading “have cake and eat it”. 

So, with confusion abounding, here is what we know from the Brexit plan debate: 

1. The government will set out a Brexit plan before triggering Article 50

The Brexit minister David Davis said that Parliament will get to hear the government’s “strategic plans” ahead of triggering Article 50, but that this will not include anything that will “jeopardise our negotiating position”. 

While this is something of a victory for the Remain MPs and the Opposition, the devil is in the detail. For example, this could still mean anything from a white paper to a brief description released days before the March deadline.

2. Parliament will get a say on converting EU law into UK law

Davis repeated that the Great Repeal Bill, which scraps the European Communities Act 1972, will be presented to the Commons during the two-year period following Article 50.

He said: “After that there will be a series of consequential legislative measures, some primary, some secondary, and on every measure the House will have a vote and say.”

In other words, MPs will get to debate how existing EU law is converted to UK law. But, crucially, that isn’t the same as getting to debate the trade negotiations. And the crucial trade-off between access to the single market versus freedom of movement is likely to be decided there. 

3. Parliament is almost sure to get a final vote on the Brexit deal

The European Parliament is expected to vote on the final Brexit deal, which means the government accepts it also needs parliamentary approval. Davis said: “It is inconceivable to me that if the European Parliament has a vote, this House does not.”

Davis also pledged to keep MPs as well-informed as MEPs will be.

However, as shadow Brexit secretary Keir Starmer pointed out to The New Statesman, this could still leave MPs facing the choice of passing a Brexit deal they disagree with or plunging into a post-EU abyss. 

4. The government still plans to trigger Article 50 in March

With German and French elections planned for 2017, Labour MP Geraint Davies asked if there was any point triggering Article 50 before the autumn. 

But Davis said there were 15 elections scheduled during the negotiation process, so such kind of delay was “simply not possible”. 

5. Themed debates are a clue to Brexit priorities

One way to get a measure of the government’s priorities is the themed debates it is holding on various areas covered by EU law, including two already held on workers’ rights and transport.  

Davis mentioned themed debates as a key way his department would be held to account. 

It's not exactly disclosure, but it is one step better than relying on a camera man papping advisers as they walk into No.10 with their notes on show. 

6. The immigration policy is likely to focus on unskilled migrants

At the Tory party conference, Theresa May hinted at a draconian immigration policy that had little time for “citizens of the world”, while Davis said the “clear message” from the Brexit vote was “control immigration”.

He struck a softer tone in the debate, saying: “Free movement of people cannot continue as it is now, but this will not mean pulling up the drawbridge.”

The government would try to win “the global battle for talent”, he added. If the government intends to stick to its migration target and, as this suggests, will keep the criteria for skilled immigrants flexible, the main target for a clampdown is clearly unskilled labour.  

7. The government is still trying to stay in the customs union

Pressed about the customs union by Anna Soubry, the outspoken Tory backbencher, Davis said the government is looking at “several options”. This includes Norway, which is in the single market but not the customs union, and Switzerland, which is in neither but has a customs agreement. 

(For what it's worth, the EU describes this as "a series of bilateral agreements where Switzerland has agreed to take on certain aspects of EU legislation in exchange for accessing the EU's single market". It also notes that Swiss exports to the EU are focused on a few sectors, like chemicals, machinery and, yes, watches.)

8. The government wants the status quo on security

Davis said that on security and law enforcement “our aim is to preserve the current relationship as best we can”. 

He said there is a “clear mutual interest in continued co-operation” and signalled a willingness for the UK to pitch in to ensure Europe is secure across borders. 

One of the big tests for this commitment will be if the government opts into Europol legislation which comes into force next year.

9. The Chancellor is wooing industries

Robin Walker, the under-secretary for Brexit, said Philip Hammond and Brexit ministers were meeting organisations in the City, and had also met representatives from the aerospace, energy, farming, chemicals, car manufacturing and tourism industries. 

However, Labour has already attacked the government for playing favourites with its secretive Nissan deal. Brexit ministers have a fine line to walk between diplomacy and what looks like a bribe. 

10. Devolved administrations are causing trouble

A meeting with leaders of Scotland, Wales and Northern Ireland ended badly, with the First Minister of Scotland Nicola Sturgeon publicly declaring it “deeply frustrating”. The Scottish government has since ramped up its attempts to block Brexit in the courts. 

Walker took a more conciliatory tone, saying that the PM was “committed to full engagement with the devolved administrations” and said he undertook the task of “listening to the concerns” of their representatives. 

11. Remain MPs may have just voted for a trap

Those MPs backing Remain were divided on whether to back the debate with the government’s amendment, with the Green co-leader Caroline Lucas calling it “the Tories’ trap”.

She argued that it meant signing up to invoking Article 50 by March, and imposing a “tight timetable” and “arbitrary deadline”, all for a vaguely-worded Brexit plan. In the end, Lucas was one of the Remainers who voted against the motion, along with the SNP. 

George agrees – you can read his analysis of the Brexit trap here

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.