To have a clear line on the economy, Miliband needs a line on the unions

Labour policy formation is one long seminar that skirts around an obvious obstacle to reform.

It is good news that unemployment has fallen again. The government will be pleased; Labour will counsel caution. It is too early to identify a trend in employment growth. Inflation was up yesterday, so the decline in real wages and the squeeze on low-income households continues. The Bank of England has downgraded its growth forecast for 2013. Only around 20 per cent of the cuts originally envisaged in George Osborne’s "Plan A" have been implemented so far and a whole new set of cuts will be announced in the Autumn Statement on 5 December. There are always reasons not to be cheerful.

But that is a substantial part of Labour’s problem when it comes to the economy. It has become tactically reliant on gloom, even when Ed Miliband insists his strategic vision – the "One Nation" proposition – is inspiring and optimistic.

A hazard for the Tories, as I’ve noted before, is that the economy will appear to recover a bit on paper, in a way that emboldens ministers to tell people they are better off and that the plan is working, but without the public experiencing a tangible improvement in their circumstances. Wage stagnation makes it quite likely many people will feel poorer in 2015 than they did when the coalition came to power. The Chancellor or Prime Minister insisting voters are better off than they know – because, for example, the long-term prospects for fiscal sustainability are mildly improved - will just reinforce the sense that Conservatives dwell on a different, more expensively furnished planet.   

For Labour to capitalise on that weakness they need to meet certain tests. They need to demonstrate that they understand that public money doesn’t grow on Treasury trees; that it comes from real people’s pockets. Even if the pooling of that resource for good social ends is a desirable political project, consent for that harvest can’t be taken for granted. Crucially, the mechanism for allocating those funds cannot be seen as wasteful or self-serving.

In other words, Labour needs to sound assertive in its ambitions to reform the state. (That isn’t the same thing as shrinking the state, but it probably requires some recognition that the urge to expand the state as the default answer to social problems looks implausible in the current climate.)

There has been a whole lot of discussion in this area recently. See this from earlier in the week, via the IPPR, and screeds on Labour List, guest edited this week by Jon Cruddas.  Reinforcing the urgency of the whole conversation is this report from the RSA and the SMF.

An essential, albeit quite technical observation from that analysis is that falling unemployment suggests that the "output gap" – the gulf between the economy’s current performance and its potential – is smaller than the Treasury has estimated. Crudely speaking, that suggests the portion of the deficit that won’t be simply burnt off by a return to growth is higher – it is structurally baked in harder than previously thought. On top of that are all sorts of bleak accounts of the mounting demographic pressures on society – the hard, upward pressure on health spending and pensions in particular.

One political conclusion from all this is that Labour should speak more openly and frankly about the scale of the fiscal challenge ahead and the requirement that public service delivery change in response. That has to be the safer option than the current trajectory, which is to concede in the vaguest possible terms that budget discipline is a recognised yet distasteful obligation without really engaging in the conversation about how it will be enacted.

In a perverse way, the difficulties presented by the long-term outlook give cover to Labour to move on from the necessarily short-term and abstract macroeconomic argument it has been engaged in for the past two years. It is entirely possible that Ed Balls has been right about the need for fiscal stimulus and also that no-one cares. The non-existent growth we might have had if different policies had been pursued in 2010 can’t be presented on the doorstep as a reason to vote Labour in 2015.

The Tories have a very different problem. No-one doubts their determination to make cuts, but their underlying motive and, increasingly, their competence in administering austerity are in doubt. The Conservatives have to tread carefully when it comes to advertising their intention to reform the state, because for many people that sounds like a euphemism for indiscriminate privatisation and public sector redundancies. That suspicion, expressed in opinion polls and focus groups, was a significant factor in decisions last year to scale down ambitious plans to reconfigure vast swathes of the public sector – with much more outsourcing to private companies – under a "Big Society" rubric. Such caution was a source of frustration to Steve Hilton, David Cameron’s strategic advisor, and a factor leading to his departure from Downing Street. Without Hilton the impetus for dramatic, visionary reform of the state has largely gone. The Tories' difficulties in persuading people they are reliable stewards of services will be exacerbated as budget pressure and a disorderly restructuring wreak havoc in the NHS.

There is an opportunity there for Labour, presuming Ed Miliband has the courage to seize it. Voters know that Labour cares about the public sector. Of course it does. Miliband could use that confidence as a cudgel to beat the coalition, accusing them of senseless vandalism. He could also use it as a platform to win support for what would be advertised as a fairer, more compassionate approach to reform  - one that is conducted with deference to the ethos of public service, without a fetishistic faith in private enterprise but in recognition of the fiscal challenge ahead.

In so doing he could kill the Tory charge that Labour are in denial about the deficit and national debt. Instead of saying, in abstract terms, that a Miliband government would take tough decisions, the opposition leader should talk up exciting ideas for innovation in the way services are delivered. He needs to find dynamic charities and social enterprises and go on about how their creativity shows the way forward. The very fact of advertising an interest in better, more efficient, more effective ways to get the kinds of outcomes Labour has traditionally relied on Whitehall to deliver contains in it the recognition of the need to get more for less out of public services. It swallows up the deficit denial charge whole without even having to rebut it directly.

There is an obvious obstacle to this path: trade union leaders won’t like it. Once you start talking about alternative mechanisms for delivering services, there will be people in the labour movement who smell Blairite conspiracy and crypto-Toryism under the bed. That will be the case even if Miliband goes out of his way to emphasise that reform will be conducted wholly in keeping with the traditional values of fairness and equality that have historically animated the left.

Senior figures around Miliband privately concede that this is a problem. They know that moving the party’s economic story beyond outraged rejection of the decisions George Osborne is making will require some account of public sector reform. They also know that the broad "One Nation" vision is hard to turn into a practical agenda for changing the way the state and the economy are organised without also having an agenda for the way labour is organised. As one shadow cabinet friend of Miliband puts it: "Before the election we’ll need a positive story about the role of unions in responsible capitalism." The Labour leader knows that story needs writing, but there never seems to be a good time to sit down and write it.   

Miliband’s cheerleaders on Labour blogs and in think tanks and seminars are the same – long on paradigms and re-imaginings of the role of government, short on specific reference to the unions. That will have to change before the party can draft a manifesto. Ideally, the unions themselves could start talking seriously and practically about imaginative ways to innovate in the provision of public services. They should do. They probably won’t. 

Ed Miliband addresses TUC members in Hyde Park last month after an anti-austerity march. Photograph: Getty Images.

Rafael Behr is political columnist at the Guardian and former political editor of the New Statesman

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Obama's Hiroshima visit is a wake up call on the risks of nuclear weapons

The president's historic visit must lead to fresh efforts to rid our world of destructive missiles and safeguard our futures.

We now know more than ever the dangers of an accidental or deliberate detonation of a nuclear weapon. We also realise that there can be no adequate humanitarian response to such a nightmare scenario.

Malfunctions, mishaps, false alarms and misinterpreted information have nearly led to the intentional or accidental detonation of nuclear weapons on numerous occasions since 1945, according to testimonies by experts and former nuclear force officers. In the past two years alone, the organisation Global Zero has documented scores of “military incidents” involving nuclear weapon states and their allies, alongside the increasing risks stemming from cyberattacks.

Put this together with recent insight into the appalling long-term health impact of the Hiroshima and Nagasaki explosions themselves, and the sheer human cost of any future nuclear bomb blast, and you have a truly alarming picture.

We were in Hiroshima and Nagasaki last year, speaking to survivors, or hibakusha, as they are known. More than 70 years on, their lives, and the lives of countless people in Japan, are still overshadowed by these two watershed events in the history of modern warfare.

After the detonations, Red Cross staff struggled in unimaginable conditions to relieve the suffering caused by the atomic blasts. With hospitals reduced to rubble and ash and medical supplies contaminated, the provision of even basic health care was well nigh impossible.

But the nightmare is far from over even today.

Doctors at the Japanese Red Cross Society hospitals in Hiroshima and Nagasaki say that some two-thirds of the deaths among elderly hibakusha are from probably radiation-related cancers. And aside from the physical symptoms, the psychological trauma is still ever present.

No-one who visits Hiroshima’s Peace Memorial Museum, or who sees the continued suffering of thousands of elderly survivors, can be in any doubt of the catastrophic and irreversible effects of nuclear weapons. Nor could they in good conscience argue that these weapons somehow act as guarantors of global security or protectors of humanity as a whole.

Of course, the bombs in the arsenals of nuclear-armed States today are far more powerful and destructive. And modern research only makes the case against them stronger. Studies suggest that the use of nuclear weapons now even on a limited scale, would have disastrous and long-lasting consequences on human health, the environment, the climate, food production and socioeconomic development.

Health problems would span generations, with children of survivors facing significant risks from the genetic damage inflicted on their parents.

Seventy years after the dawn of the "nuclear age", there may be no effective or feasible means of assisting a substantial portion of survivors in the immediate wake of a nuclear detonation.

And make no mistake. The devastation of a future bomb will show no respect for national borders. It is likely to ravage societies far beyond its intended target country. Which makes the continued existence of nuclear weapons and the risk that entails a global concern.

Faced with these conclusions, you might imagine the international community would pull back from the brink of potential tragedy and take steps to eradicate these weapons.

Sadly, last year’s review conference of the Treaty of the Non-Proliferation of Nuclear Weapons, which had the opportunity to advance disarmament, failed to do so.

The International Red Cross and Red Crescent Movement has called on States to negotiate an international agreement to prohibit the use of and completely eliminate nuclear weapons within a binding timetable. We reiterate that call today. The political will to rid the world of this menace must urgently be found.

Until the last nuclear weapon is eliminated, there are essential steps which nuclear States can and must take now to diminish the danger of another Hiroshima and Nagasaki.

It is imperative that these States and their allies reduce the role of nuclear weapons in their military plans, doctrines and policies and cut the number of nuclear warheads on high alert status. The current modernization and proliferation of nuclear arsenals is leading us towards potential catastrophe.

The horror of Hiroshima and Nagasaki and the human suffering inflicted still holds powerful lessons. President Obama’s landmark visit on Friday will surely be a powerful reminder of the terrible destruction that nuclear weapons wreak.

We must act on this reminder.

To truly pay homage to those whose lives were lost or irrevocably altered by the Hiroshima and Nagasaki bombings, President Obama’s visit must galvanize the international community to move without delay towards a world free of nuclear weapons.

The fact that these weapons have not been used over the past 70 years does not guarantee a risk-free future for our children. Only the prohibition and elimination of nuclear weapons can do that.

Peter Maurer is President of the International Committee of the Red Cross. Tadateru Konoe is President of the International Federation of Red Cross and Red Crescent Societies and of the Japanese Red Cross Society.