Osborne’s secret desire

The Chancellor is a flawed visionary. Labour can learn from his strengths and his weaknesses.

George Osborne has a secret desire – to turn the UK into Germany. Look back at his speeches and statements before the election, and he makes it clear, with admirable clarity, that he wants to turn the UK into an economic mirror image of itself. His long-term vision is of an economy where exports outstrip imports, where the popular inclination is to save rather than indulge in debt-fuelled spending, where investment in the real economy is flourishing, and where, of course, the public finances are incontrovertibly sound.

The Chancellor has even gone so far as to say that these are the leading benchmarks against which the success of a Conservative government will be judged. Expect Oktoberfest and decent World Cup performances to feature in the next Queen's Speech.

Does Labour have an equivalent vision? The sorry answer must be "no". So focused was the last government, maybe understandably, on the immediate crises of banks and public finances that little time was given to thinking longer term. The one exception was Peter Mandelson, who began tentatively outlining the hope of an economy built around high-growth, low-carbon sectors, but certainly nothing against which one could benchmark progress. The leadership campaign, fuzzy and symbolic as much of it was, was unable to get down to the real nitty-gritty of long-term economic policy despite an early attempt by David Miliband.

Of course, the commitment to reduce inequality, regulate finance and address regional imbalances that Ed Miliband, the new Labour leader, outlined in his conference speech is a long-term economic vision of sorts. But these are core progressive aspirations that are far more about redressing the damaging consequences of decades of neoliberalism than they are about plotting a post-crisis course for economic survival in what is bound to be a hellishly competitive global market.

Politically, maybe this doesn't matter. It could be that the coalition will fall apart under a series of tactical strikes by Labour rather than by posing one strategic vision against another. But this would seem a risky plan. An opposition, much like a government, needs a visionary set of goals to inspire it through the long months and years of political slog. It also needs an overarching narrative that explains the past and shapes the future to give its electoral offer coherence and, most importantly, to make it look like a serious government-in-waiting. And, should one actually get into government, it always pays to have done your most serious thinking beforehand.

But this goes beyond party politics. Few in the policy world, let alone among the wider public, have cottoned on to quite how threatening the economic situation is for the UK. Economic power is shifting eastwards to countries and companies with access to vast resources of finance and labour and, increasingly, know-how. Without a thorough policy debate about what role the UK can play in this new world, we risk sleepwalking into a spiral of economic decline.

This would not be without precedent – poor policymaking and some terrible business decisions in the postwar years left the UK trailing competitors in North America and Europe and set the stage for the crisis of the 1970s. Labour has a heavy obligation to engage in hard thinking and do some tough questioning of long-term Tory plans.

The new leadership could do worse than start with Osborne's own vision. A UK economy built around higher savings, exports, business investment and stable public finances is certainly nothing to be sneezed at. There are difficult questions to be asked about how realistic such goals are, given that they run so much against the grain of the UK economy's characteristics built up over many years.

Transforming this country into one of the world's export economies is a tough call when other countries are already well ahead of the UK in this game and when the risks of protectionism remain high. But as ideals at which to aim, they are a worthy starting point, and mark a clear break with a pre-crisis model that now seems unlikely to re-emerge in its full previous glory, and would not be welcome if it did.

But it is in the route map to achieve these goals that Osborne's vision is so weak, creating the opportunity for Labour to seize political advantage by developing a much stronger map of its own. The Chancellor seems convinced that a retread of the policies of the 1980s is the key to a German-style economy. He in effect said precisely this during his Mais Lecture back in February. Unleash a "supply-side revolution", akin to the one engineered by Howe and Lawson, through lower business tax and higher skills, and watch the investment flood in to new business and drive up exports.

There are many problems with his approach, not least that Osborne seems to be doing as much to terrify investors as attract them. But more fundamentally, it bears little relation to the route that Germany took to build its model. Naturally, the Germans always had a healthy respect for free markets and competition. But one cannot overlook the central role that the publicly owned KFW investment bank plays in maintaining high levels of long-term investment. Nor should we ignore the role that genuinely bold skills policies and works councils play in ensuring competitiveness in export markets. Nor the role that a huge research body such as the Fraunhofer Institute plays in constant business innovation. No policies on an equivalent scale are likely to emerge soon from a government that seems pathologically averse to anything that might be judged interventionist or might carry a cost.

It is here that Labour can begin to fashion a genuine post-crisis, long-term vision – one that might embrace some or all of Osborne's vision, but then plots a course based on a cool assessment of what has worked in the real world of the great exporters, rather than what the Chancellor's rosy reading of the Thatcher era and dogmatic antipathy to the state might suggest.

Adam Lent is head of economic and social affairs at the TUC.

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The economics of outrage: Why you haven't seen the end of Katie Hopkins

Her distasteful tweet may have cost her a job at LBC, but this isn't the last we've seen of Britain's biggest troll. 

Another atrocity, other surge of grief and fear, and there like clockwork was the UK’s biggest troll. Hours after the explosion at the Manchester Arena that killed 22 mostly young and female concert goers, Katie Hopkins weighed in with a very on-brand tweet calling for a “final solution” to the complex issue of terrorism.

She quickly deleted it, replacing the offending phrase with the words “true solution”, but did not tone down the essentially fascist message. Few thought it had been an innocent mistake on the part of someone unaware of the historical connotations of those two words.  And no matter how many urged their fellow web users not to give Hopkins the attention she craved, it still sparked angry tweets, condemnatory news articles and even reports to the police.

Hopkins has lost her presenting job at LBC radio, but she is yet to lose her column at Mail Online, and it’s quite likely she won’t.

Mail Online and its print counterpart The Daily Mail have regularly shown they are prepared to go down the deliberately divisive path Hopkins was signposting. But even if the site's managing editor Martin Clarke was secretly a liberal sandal-wearer, there are also very good economic reasons for Mail Online to stick with her. The extreme and outrageous is great at gaining attention, and attention is what makes money for Mail Online.

It is ironic that Hopkins’s career was initially helped by TV’s attempts to provide balance. Producers could rely on her to provide a counterweight to even the most committed and rational bleeding-heart liberal.

As Patrick Smith, a former media specialist who is currently a senior reporter at BuzzFeed News points out: “It’s very difficult for producers who are legally bound to be balanced, they will sometimes literally have lawyers in the room.”

“That in a way is why some people who are skirting very close or beyond the bounds of taste and decency get on air.”

But while TV may have made Hopkins, it is online where her extreme views perform best.  As digital publishers have learned, the best way to get the shares, clicks and page views that make them money is to provoke an emotional response. And there are few things as good at provoking an emotional response as extreme and outrageous political views.

And in many ways it doesn’t matter whether that response is negative or positive. Those who complain about what Hopkins says are also the ones who draw attention to it – many will read what she writes in order to know exactly why they should hate her.

Of course using outrageous views as a sales tactic is not confined to the web – The Daily Mail prints columns by Sarah Vine for a reason - but the risks of pushing the boundaries of taste and decency are greater in a linear, analogue world. Cancelling a newspaper subscription or changing radio station is a simpler and often longer-lasting act than pledging to never click on a tempting link on Twitter or Facebook. LBC may have had far more to lose from sticking with Hopkins than Mail Online does, and much less to gain. Someone prepared to say what Hopkins says will not be out of work for long. 

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