John McDonnell interview: how Labour is moving to the left

The leader of the Labour left on why his job is to make issues "safe" for Ed Miliband and why the party will be "forced to look at more radical options".

Located in a shabby portacabin off Hayes high street, everything about John McDonnell's offices says Old Labour. Union flags and banners decorate the windows and walls and various trade union awards and trinkets occupy a cabinet, which is the only piece of furniture in the waiting room save some fold-up chairs – even the carpet is red. This a fitting environment for McDonnell, who cut his political teeth as a researcher at the NUM, before going on to work for the TUC and then as Ken Livingstone's deputy at the GLC – before being fired for being too radical for "red Ken".

After 1997, McDonnell voted against almost all of New Labour's flagship policies, including the war on Iraq, foundation hospitals, top-up fees, trust schools and anti-terror laws - "it wasn't an oppositionist position – I was opposing things because they were just wrong. I couldn't do anything else, there was no compromise." He stood for the party leadership once, after Tony Blair stood down in 2007, and again in 2010 – both times on the promise that he would reverse the party's moves towards privatisation and reinstate a "real Labour government". Despite support from the TUC and party members, he twice failed to receive sufficient nominations from MPs to go through to the electoral college stage.

He is keen to stress that he never intended to stand for leadership, saying he only did so in order that the left of the party could "publish a political programme and demonstrate we've got support for that political programme". He says that the high bar for parliamentary Labour nominations meant "I was blocked from the ballot paper They were terrified that if I got on the ballot paper I would show sufficient breadth of support from the rank and file members and the trade union movement that they'd have to acknowledge there was support for the policies I was advocating." Who is this "they"? "Blair and Brown, that whole clique basically."

Why, then, did he stay with Labour, when its leaders were advocating policies to which he was morally opposed? "Because it's my party, not theirs. I saw the Blair-Mandelson regime as a coup, and I think it was a well-funded coup as well – resources obviously came from big private-sector backers. But all through that period the bulk of the rank and file party were what the party has always been, a socialist party."

And what about now? McDonnell suggests that Labour Party supporters are moving away from what was "the march to the neo-liberal right" - "A lot of people woke up and thought 'how have we got in to this?'". He said that Labour's opposition to the coalition's welfare uprating bill was demonstrative of a "significant shift in parliamentary Labour Party attitude". "The debate was tremendous – Labour MP after Labour MP getting up and putting forward the arguments about deprivation and redistribution of wealth." Equally, he says, Ed Miliband's recent policy proposal to bring back the 10p tax rate funded by a "mansion tax" is another sign of a shift to the left -  "it recognises the mistake it was to abolish it but also more importantly it is part of the process of reasserting the role Labour has to play in redistributing wealth."

For McDonnell, who chairs various socialist groups, including the Labour Representation Committee, the Socialist Campaign Group and Public Services Not Private Profit – the left of Labour is regaining power within the party. This is aided greatly, he says, by the development of new media. "In the past the media was a real problem. In terms of mainstream media it's very difficult to break through if you're on the left." An exception to this rule is Chavs author Owen Jones, who previously worked for McDonnell organising his leadership campaign. "Owen's done very well, he's been swept up, and it's a real breakthrough – he's done fantastically" - although McDonnell fears "they'll do a token lefty and make or break”. Who is the 'they' in this case? "Just the establishment, the establishment. But it doesn't matter because we create our own media – new technology has given us blogs, it's given us Twitter. Public meetings are packed these days".

For McDonnell, the role of Labour's left is now to make issues "safe" for the party's leadership. "If you make an issue safe, Ed Miliband will shift. Whether it's Murdoch, banks, welfare or benefits  But I don't think they'll just shift cynically, they'll shift on to the terrain that is then safe, and you can have a proper discussion then." As an example of this process, he cites the treatment of people with disabilities who were subjected to the Work Capability Assessment, a process that was initiated by New Labour and built upon by the coalition, who enlisted private IT firm Atos to finish the job. "We had two years of arguing and demonstrating how bad it was and got nowhere. In fact it was almost physical in the chamber at times – you felt threatened. But now we've got a whole swathe of opinion within the Parliamentary Labour Party and now we've now got the frontbench standing up and criticising Atos as well." He also cites the black-listing of trade union members in the construction trade as another example of an issue that's been made "safe" - "we've now even got Chuka Umunna jumping up and down about it."

McDonnell, an anti-capitalist who subscribes to a Marxist conception of class, last year published a "Radical Alternative to Austerity" in which he detailed his vision of a "democratised economy", with public ownership of firms and the City, a tax on financial transactions and a 60 per cent rate of income tax on earnings over £100,000. He concedes that he'd have a much harder job trying to get the Labour frontbench to commit to this kind of socialist policy. "The Labour leadership comes from a neo-liberal background. They served their apprenticeship deep in the heart of New Labour and they're looking to come back as New Labour mark two, slightly reformed but not challenging the system itself."

But he says that as the economic crisis deepens they'll be "forced to look at more radical options". Talking about his own constituency Hayes and Harlington, for which he has been MP since 1997, he says "we have an open-door policy four days a week because people have so many problems. I've got people coming in who are close to eviction, can't afford to pay their rent, under incredible stress – all that stuff about parents choosing between heating and eating happens on a daily basis."

He tells me that he thinks the left of Labour is even beginning to make headway on radical reform. "It's beginning to move, even there, we've got a situation where the party is looking back again to its roots around cooperation. It's beginning to open up. So what I want to do is make safe the debate around systemic change." There's a small pause before he bursts out laughing. "It's ambitious," I say.

John McDonnell, MP for Hayes and Harlington and chair of the Socialist Campaign Group of Labour MPs.
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What is the EU customs union and will Brexit make us leave?

International trade secretary Liam Fox's job makes more sense if we leave the customs union. 

Brexiteers and Remoaners alike have spent the winter months talking of leaving the "customs union", and how this should be weighed up against the benefits of controlling immigration. But what does it actually mean, and how is it different from the EU single market?

Imagine a medieval town, with a busy marketplace where traders are buying and selling wares. Now imagine that the town is also protected by a city wall, with guards ready to slap charges on any outside traders who want to come in. That's how the customs union works.  

In essence, a customs union is an agreement between countries not to impose tariffs on imports from within the club, and at the same time impose common tariffs on goods coming in from outsiders. In other words, the countries decide to trade collectively with each other, and bargain collectively with everyone else. 

The EU isn't the only customs union, or even the first in Europe. In the 19th century, German-speaking states organised the Zollverein, or German Customs Union, which in turn paved the way for the unification of Germany. Other customs unions today include the Eurasian Economic Union of central Asian states and Russia. The EU also has a customs union with Turkey.

What is special about the EU customs union is the level of co-operation, with member states sharing commercial policies, and the size. So how would leaving it affect the UK post-Brexit?

The EU customs union in practice

The EU, acting on behalf of the UK and other member states, has negotiated trade deals with countries around the world which take years to complete. The EU is still mired in talks to try to pull off the controversial Transatlantic Trade and Investment Partnership (TTIP) with the US, and a similar EU-Japan trade deal. These two deals alone would cover a third of all EU trade.

The point of these deals is to make it easier for the EU's exporters to sell abroad, keep imports relatively cheap and at the same time protect the member states' own businesses and consumers as much as possible. 

The rules of the customs union require member states to let the EU negotiate on their behalf, rather than trying to cut their own deals. In theory, if the UK walks away from the customs union, we walk away from all these trade deals, but we also get a chance to strike our own. 

What are the UK's options?

The UK could perhaps come to an agreement with the EU where it continues to remain inside the customs union. But some analysts believe that door has already shut. 

One of Theresa May’s first acts as Prime Minister was to appoint Liam Fox, the Brexiteer, as the secretary of state for international trade. Why would she appoint him, so the logic goes, if there were no international trade deals to talk about? And Fox can only do this if the UK is outside the customs union. 

(Conversely, former Lib Dem leader Nick Clegg argues May will realise the customs union is too valuable and Fox will be gone within two years).

Fox has himself said the UK should leave the customs union but later seemed to backtrack, saying it is "important to have continuity in trade".

If the UK does leave the customs union, it will have the freedom to negotiate, but will it fare better or worse than the EU bloc?

On the one hand, the UK, as a single voice, can make speedy decisions, whereas the EU has a lengthy consultative process (the Belgian region of Wallonia recently blocked the entire EU-Canada trade deal). Incoming US President Donald Trump has already said he will try to come to a deal quickly

On the other, the UK economy is far smaller, and trade negotiators may discover they have far less leverage acting alone. 

Unintended consequences

There is also the question of the UK’s membership of the World Trade Organisation, which is currently governed by its membership of the customs union. According to the Institute for Government: “Many countries will want to be clear about the UK’s membership of the WTO before they open negotiations.”

And then there is the question of policing trade outside of the customs union. For example, if it was significantly cheaper to import goods from China into Ireland, a customs union member, than Northern Ireland, a smuggling network might emerge.

 

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.