It is Cameron vs. the Tories as EU vote approaches

The PM is facing the biggest ever Conservative rebellion on Europe -- a crisis largely of his own ma

David Cameron today faces the biggest Commons revolt of his premiership -- and potentially the biggest ever Conservative rebellion on the issue of Europe.

On 20th May 1993, 41 Conservative MPs voted against John Major on the third reading of the Maastricht Treaty. To date, this was the biggest ever Tory rebellion on whipped business on Europe.

Coincidentally, it is also the figure for the largest Conservative rebellion so far in this Parliament. Earlier this month, on 10 October, 41 Tory MPs voted against attempts to criminalise "insulting" words or behaviour. This did not make much of a splash in the news -- unlike the current vote, which has gathered attention both for the spectacle of the Tories fighting over Europe (again), and because of Cameron's belated decision to impose a three-line whip.

It is still unclear how many MPs will defy the whips to vote in favour of a UK referendum on Europe, but according to the highest estimates, it could be nearly double that 41 figure. If the list of Conservative MPs who openly pledged to support the referendum is combined with those who have already defied whips over Europe since the beginning of this government, the number is closer to 78. Separately, Sunny Hundal suggests that up to 10 Labour MPs could defy their whips to vote in favour of a referendum.

Cameron is attempting to reassure the doubters that in the event of treaty change, he will renegotiate Britain's position. The story dominating the papers this morning -- that Cameron and Nicolas Sarkozy had a heated exchange on Europe -- fits the narrative that the Prime Minister wishes to further: that he is not afraid to anger European leaders in his defence Britain's interests. However, this does not appear to be getting through to his party.

In a survey for Conservative Home, 64 per cent of respondents said that they did not believe that Cameron was "very committed to repatriating any powers from the European Union", despite his promises, compared with just 18 per cent who did believe he wanted to repatriate "significant" powers.

It is impossible to say exactly how large today's Commons rebellion will be, and, as the Ballots and Bullets blog points out, the number that actually votes against the whip is almost always invariably less than that predicted. Even if the revolt is not as large as expected, however, it is difficult to see how Cameron can emerge well from this, and one must question his logic in applying the whip in the first place. Mary Anne Sieghart argues today:

If there had been a free vote, the motion might not even have been carried. But if it had, Cameron could easily have said, "I hear what you say. I agree that any renegotiated relationship with the EU will have to be endorsed by a referendum. But it's too early to call one now, when we don't yet know what shape the eurozone will take or what any new relationship will look like." He would have sounded both responsive and responsible. Instead he has absolutely infuriated his party.

Emotions in the Tory party are certainly running high, with at least one ministerial aide -- Stewart Jackson (£), aide to Owen Paterson, the Northern Ireland Secretary -- willing to vote against the whips even if it costs him his job. Graham Brady, the head of the powerful 1922 committee which represents backbenchers, is also set to defy the government (Lord Tebbit said yesterday that "not even Ted Heath faced the chairman of the 1922 Committee voting against a three-line whip"). While the vote is likely to go Cameron's way, the damage within his party will take longer to heal.

Samira Shackle is a freelance journalist, who tweets @samirashackle. She was formerly a staff writer for the New Statesman.

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The Future of the Left: A new start requires a new economy

Creating a "sharing economy" can get the left out of its post-crunch malaise, says Stewart Lansley.

Despite the opportunity created by the 2008 crisis, British social democracy is today largely directionless. Post-2010 governments have filled this political void by imposing policies – from austerity to a shrinking state - that have been as economically damaging as they have been socially divisive.

Excessive freedom for markets has brought a society ever more divided between super-affluence and impoverishment, but also an increasingly fragile economy, and too often, as in housing, complete dysfunction.   Productivity is stagnating, undermined by a model of capitalism that can make big money for its owners and managers without the wealth creation essential for future economic health. The lessons of the meltdown have too often been ignored, with the balance of power – economic and political – even more entrenched in favour of a small, unaccountable and self-serving financial elite.

In response, the left should be building an alliance for a new political economy, with new goals and instruments that provide an alternative to austerity, that tackle the root causes of ever-growing inequality and poverty and strengthen a weakening productive base. Central to this strategy should be the idea of a “sharing economy”, one that disperses capital ownership, power and wealth, and ensures that the fruits of growth are more equally divided. This is not just a matter of fairness, it is an economic imperative. The evidence is clear: allowing the fruits of growth to be colonised by the few has weakened growth and made the economy much more prone to crisis.

To deliver a new sharing political economy, major shifts in direction are needed. First, with measures that tackle, directly, the over-dominance of private capital. This could best be achieved by the creation of one or more social wealth funds, collectively held financial funds, created from the pooling of existing resources and fully owned by the public. Such funds are a potentially powerful new tool in the progressive policy armoury and would ensure that a higher proportion of the national wealth is held in common and used for public benefit and not for the interests of the few.

Britain’s first social wealth fund should be created by pooling all publicly owned assets,  including land and property , estimated to be worth some £1.2 trillion, into a single ring-fenced fund to form a giant pool of commonly held wealth. This move - offering a compromise between nationalisation and privatization - would bring an end to today’s politically expedient sell-off of public assets, preserve what remains of the family silver and ensure that the revenue from the better management of such assets is used to boost essential economic and social investment.

A new book, A Sharing Economy, shows how such funds could reduce inequality, tackle austerity and, by strengthening the public asset base, rebalance the public finances.

Secondly, we need a new fail safe system of social security with a guaranteed income floor in an age of deepening economic and job insecurity. A universal basic income, a guaranteed weekly, unconditional income for all as a right of citizenship, would replace much of the existing and increasingly means-tested, punitive and authoritarian model of income support. . By restoring universality as a core principle, such a scheme would offer much greater security in what is set to become an increasingly fragile labour market. A basic income, buttressed by a social wealth fund, would be key instruments for ensuring that the potential productivity gains from the gathering automation revolution, with machines displacing jobs, are shared by all.  

Thirdly, a new political economy needs a radical shift in wider economic management. The mix of monetary expansion and fiscal contraction has proved a blunderbuss strategy that has missed its target while benefitting the rich and affluent at the expense of the poor. By failing to tackle the central problem  – a gaping deficit of demand (one inflamed by the long wage squeeze and sliding investment)  - the strategy has slowed recovery.  The mass printing of money (quantitative easing) may have helped prevent a second great depression, but has also  created new and unsustainable asset bubbles, while austerity has added to the drag on the economy. Meanwhile, record low interest rates have failed to boost private investment and productivity, but by hiking house prices, have handed a great bonanza to home owners at the expense of renters.

Building economic resilience will require a more central role for the state in boosting and steering investment programmes, in part through the creation of a state investment bank (which could be partially financed from the proposed new social wealth fund) aimed at steering more resources into the wealth creating activities private capital has failed to fund.

With too much private credit used for financial speculation and property, and too little to small companies and infrastructure, government needs to play a much more direct role in creating credit, while restricting the almost total freedom currently handed to private banks.  Tackling the next downturn, widely predicted to land within the next 2-3 years, will need a very different approach, including a more active fiscal policy. To ensure a speedier recovery from recessions, future rounds of quantitative easing should, within clear constraints, boost the economy directly by financing public investment programmes and cash handouts (‘helicopter money’).  Such a police mix – on investment, credit and stimulus - would be more effective in boosting the real economic base, and would be much less pro-rich and anti-poor in its consequences.

These core changes would greatly reform the existing Anglo-Saxon model of capitalism and provide the foundations for building support for a new direction for progressive politics. They would pioneer new tools for building a fairer, more dynamic and more stable economy. They could draw on experience elsewhere such as the Alaskan annual citizen’s dividend (financed by a sovereign wealth fund) and the pilot basic income schemes launching in the Netherlands, Finland and France.  Even mainstream economists, including Adair Turner, former chairman of the Financial Services Authority, are now talking up the principle of ‘helicopter money’. For these reasons, parts of the package are likely to prove publicly popular and command support across the political divide. Together they would contribute to a more stable economy, less inequality, and a more even balance of power and opportunity.

 

Stewart Lansley is the author of A Sharing Economy, published in March by Policy Press and of Breadline Britain, The Rise of Mass Impoverishment (with Joanna Mack).