Why Miliband and Blair can now share a platform

As Blair has moderated his stance on the deficit, Miliband has opened his door.

Those understandably alarmed by the announcement that Tony Blair will return as an "adviser" to Labour will presumably be relieved to learn that his remit is limited to how Britain can maximise its "Olympic legacy". As Labour List's Mark Ferguson writes, "If the party is going to fall out over what Tony Blair thinks we should do with a velodrome, we’re in real trouble…". 

Yet the political symbolism of Ed Miliband's decision to share a platform with the former prime minister at last night's Labour fundraising dinner should not be underestimated. In the early months of Miliband's leadership, when he distanced the party from Blair's stances on Iraq, the economy, tuition fees and civil liberties, the two would never have appeared in such close proximity. Blair's memoir, A Journey, in which he echoed the coalition's stance on deficit reduction, was seen as confirmation of his toxic status.

But Blair has since privately indicated that he agrees with Ed Balls's critique of the government's austerity programme as self-defeating. In his view, the coalition is going "too far, too fast". As a result, Miliband is far more comfortable about appearing in public with Blair. Having already put clear red water between himself and the former prime minister, he is confident that Blair's return will not be seen as evidence of a shift to the right. 

Where Blair and Miliband continue to differ is on the future of capitalism. While Miliband believes the neoliberal model has fundamentally failed, Blair believes it can be revived. As the latter recently told the Evening Standard, "I understand that some people think the financial crisis has altered everything. And the mood is against this. Personally I don't think that's correct." But Blair is not alone in such thinking. While Miliband and Balls are at one on the need to limit austerity, the shadow chancellor is more sceptical of his leader's call for a new economic model.

Beyond this, one other thing is clear: Blair, like the rest of Westminster, has been forced to recognise Miliband as a potential future prime minister. As he said last night:

There is a rulebook in politics that goes something like this: Labour governs. Labour loses. Tories take over. Labour goes crazy. Tories carry on governing.

Time to re-write that script.

Actually it is being re-written by them and by us. They’re on their way down. We’re on our way up.

That Blair can now state with conviction that Labour, not the Tories, will win the next election is evidence of the transformation in Miliband's political fortunes.

Tony Blair talks with Ed Miliband during a service to mark the Diamond Jubilee. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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In your 30s? You missed out on £26,000 and you're not even protesting

The 1980s kids seem resigned to their fate - for now. 

Imagine you’re in your thirties, and you’re renting in a shared house, on roughly the same pay you earned five years ago. Now imagine you have a friend, also in their thirties. This friend owns their own home, gets pay rises every year and has a more generous pension to beat. In fact, they are twice as rich as you. 

When you try to talk about how worried you are about your financial situation, the friend shrugs and says: “I was in that situation too.”

Un-friend, right? But this is, in fact, reality. A study from the Institute for Fiscal Studies found that Brits in their early thirties have a median wealth of £27,000. But ten years ago, a thirty something had £53,000. In other words, that unbearable friend is just someone exactly the same as you, who is now in their forties. 

Not only do Brits born in the early 1980s have half the wealth they would have had if they were born in the 1970s, but they are the first generation to be in this position since World War II.  According to the IFS study, each cohort has got progressively richer. But then, just as the 1980s kids were reaching adulthood, a couple of things happened at once.

House prices raced ahead of wages. Employers made pensions less generous. And, at the crucial point that the 1980s kids were finding their feet in the jobs market, the recession struck. The 1980s kids didn’t manage to buy homes in time to take advantage of low mortgage rates. Instead, they are stuck paying increasing amounts of rent. 

If the wealth distribution between someone in their 30s and someone in their 40s is stark, this is only the starting point in intergenerational inequality. The IFS expects pensioners’ incomes to race ahead of workers in the coming decade. 

So why, given this unprecedented reversal in fortunes, are Brits in their early thirties not marching in the streets? Why are they not burning tyres outside the Treasury while shouting: “Give us out £26k back?” 

The obvious fact that no one is going to be protesting their granny’s good fortune aside, it seems one reason for the 1980s kids’ resignation is they are still in denial. One thirty something wrote to The Staggers that the idea of being able to buy a house had become too abstract to worry about. Instead:

“You just try and get through this month and then worry about next month, which is probably self-defeating, but I think it's quite tough to get in the mindset that you're going to put something by so maybe in 10 years you can buy a shoebox a two-hour train ride from where you actually want to be.”

Another reflected that “people keep saying ‘something will turn up’”.

The Staggers turned to our resident thirty something, Yo Zushi, for his thoughts. He agreed with the IFS analysis that the recession mattered:

"We were spoiled by an artificially inflated balloon of cheap credit and growing up was something you did… later. Then the crash came in 2007-2008, and it became something we couldn’t afford to do. 

I would have got round to becoming comfortably off, I tell myself, had I been given another ten years of amoral capitalist boom to do so. Many of those who were born in the early 1970s drifted along, took a nap and woke up in possession of a house, all mod cons and a decent-paying job. But we slightly younger Gen X-ers followed in their slipstream and somehow fell off the edge. Oh well. "

Will the inertia of the1980s kids last? Perhaps – but Zushi sees in the support for Jeremy Corbyn, a swell of feeling at last. “Our lack of access to the life we were promised in our teens has woken many of us up to why things suck. That’s a good thing. 

“And now we have Corbyn to help sort it all out. That’s not meant sarcastically – I really think he’ll do it.”