Inside Miliband's "one nation" project

The Labour leader's chief strategist Stewart Wood on the inspiration he takes from Thatcher and the five principles behind "one nation".

I've just returned from Queen Mary, University of London, where some of Labour's brightest minds, including Jon Cruddas, Jonathan Rutherford and Maurice Glasman, are meeting for a one day conference on "The Politics of One Nation Labour" (the event is being live blogged by Labour List). 

Stewart Wood, Ed Miliband's consigliere, who sits in the shadow cabinet as minister without portfolio, opened proceedings and drew laughter when he revealed that he'd just bought a copy of Hayek's The Road to Serfdom (a favourite text of Margaret Thatcher's). One of the main reasons he entered politics, he said, was Thatcher and her belief that "ideas could be transformational". As Miliband has hinted in his statements since her death, he and his allies take inspiration from how she broke with the political and economic consensus of the time and established a new governing philosophy (although one might pause to note the irony of a Thatcher-esque project that describes itself as "one nation"). 

Wood remarked that Thatcher's achievement lay in spotting "the exhaustion of an old settlement", adding that the public would reward those who did the same today. Miliband's one nation approach, he said, was a "profound challenge" to the consensus that took root in 1979. 

He went on to outline the five main principles behind "one nation" Labour:

1. A different kind of economy

2. A determination to tackle inequality

3. An emphasis on responsibility (at the top and the bottom)

4. Protecting the elements of our common life

5. Challenging the ethics of neoliberalism

What does all this mean for policy? Today, Wood emphasised what he calls a "supply side revolution from the left": reforming the banking system so that it supports, rather than hinders, long-term growth and an active industrial policy; working with employers to build technical education and "filling out the middle" of our "hourglass economy" by expanding use of the living wage. Without uttering the dread word "predistribution", he spoke of building an economy in which greater equality is "baked in", not "bolted on afterwards". Rather than merely ameliorating inequalities through the tax and benefits system (although Wood emphasised that redistribution would remain an important part of the social democratic arsenal), the state should act to ensure that they do not arise in the first place.

On social security, he spoke, as other Labour figures have done, of strengthening the contributory principle, so that there is a clearer relationship between what people put in and what they get out. The hope is that this would revive public confidence in the welfare state and Wood also pointed out that contributory and universal systems had proved less vulnerable to cuts than those based on means-testing. As I noted in my recent piece on why Labour must defend universal pensioner benefits, history shows that a narrower welfare state soon becomes a shallower one as the politically powerful middle classes lose any stake in the system and the poor are stigmatised as "dependent". The "paradox of redistribution", as social scientists call it, is that provision for some depends on provision for all.

Wood concluded by discussing the three main challenges facing one nation Labour: the fiscal constraints imposed by a lack of growth; building new institutions and restoring faith in politics. The biggest obstacle to change, he said, was not hostility to Labour but the belief that politicians were "all the same" and that "none of you can change anything". He observed that while the right "thrives on the pessimism that nothing can change", the left is "starved of oxygen". The greatest challenge for Labour, then, is to attack the coalition's failures while simultaneously persuading voters that they were far from inevitable. 

Ed Miliband addresses workers at Islington Town Hall on November 5, 2012 in London. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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Brexit is the beginning of the end for Northern Ireland

The age-old bid for a unified Ireland is now wearing utilitarian clothes. 

Brexit has presented British politics with something akin to a "reverse West Lothian Question". Instead of worrying why Scots should get a vote on English laws, we now have English voters telling Scotland and Northern Ireland they must leave the European Union, despite the people in both small countries opting to stay. 

Sinn Fein could hardly believe its luck that 56 per cent of Northern Ireland’s voters chose to remain in the EU, but are nevertheless being forced out by the weight of English votes for Brexit. Their immediate call for a "border poll" on Irish unity is opportunistic and will, for now, go unheeded. 

What is different, though, is their age-old bid for Irish re-unification now comes wearing neutral, utilitarian colours, responding to a genuine, contemporary issue. Moreover, the threat of Brexit to Northern Ireland has seen the Irish establishment, in the shape of Irish Taoiseach Enda Kenny, and his opposite number, the Fianna Fail leader Micheál Martin, echo calls for an (eventual) poll on Irish unity.

Brexit is, indisputably, a game-changer. We are now plausibly witnessing the beginning of the end of Northern Ireland. Not least because the economics of leaving the EU are so utterly disastrous for it. 

Back in March, Northern Ireland’s Department of Enterprise, Trade and Investment calculated that the risks of Brexit would be much more serious for Northern Ireland than the rest of Britain. Whereas Britain’s economic losses will be measured in the region of 0.1-4 per cent of GDP, for Northern Ireland that increases to up to 5.6 per cent.

In short, if Britain catches a cold by leaving the EU, Northern Ireland will get flu. Even if Theresa May eventually manages to negotiate ongoing single market access, the loss of agricultural subsidies and regeneration cash will be an unmanageable burden for the fragile cross-community executive to deal with.  

Last year, the devolved assembly's enterprise committee commissioned a report that showed the province received £2.4bn from the EU between 2007-13, and that continued funding deals up to 2020 are "central to Northern Ireland[s] economic and innovation strategies".

The report's author, Dr Leslie Budd from the Open University, argued that as well as damaging Northern Ireland's attractiveness as an entry route into the single market, transaction costs for trading into the EU would "rise significantly" and inhibit economic co-operation with the neighbouring Irish Republic. 

This is important because the Northern Ireland Executive plans to harmonise corporation tax rates with it in 2018. It is hoped the move will make the North a leaner competitor to the South in the foreign investment stakes, however it will still fall short if the Republic remains in the single market and Northern Ireland does not. 

Worries about any deterioration in North-South relations and being cut-off from the EU are very real. The Northern Ireland Chambers of Commerce have recently signed a ‘formal affiliation’ with Chambers Ireland to bolster all-Ireland business co-operation "in the current period of uncertainty." 

Meanwhile, there has been a rush to apply for Irish passports, so much so, in fact, that it’s said Belfast’s post offices have run out of application forms. Indeed, no less a figure than Democratic Unionist MP, Ian Paisley Junior, suggested his constituents should think of applying for one. A genuine "through the looking glass moment" to hear that from a Paisley.

The obvious effect of Brexit-inspired instability in Northern Ireland is that it will become an even larger burden on the British Exchequer. Already, one in three works in the engorged public sector and its fiscal deficit is so large the Treasury has to pump in £9 billion a year. Will hard-pressed English taxpayers prove willing to continue to bail out a place of which they know and care little?

But this is only half the story. If these are the obvious pressures as a result of Northern Ireland leaving the EU, what, then, are the benefits of joining with the Irish Republic? 

A major US academic study by the University of British Columbia last year modelled various scenarios and concluded that Irish unity could drive out €36bn euros of value during the first eight years, with the benefits disproportionately felt in Northern Ireland. 

So a clear, existential economic problem has emerged and with it a convincing, evidence-based economic solution. The only snag with Northern Ireland, though, is the politics.

The principle of consent, that there can be no change in its constitutional status unless a majority wishes it, is hardwired into the Good Friday Agreement and there is, so far, precious little interest among unionists in joining the Irish Republic.

But as the old saying goes, unionists are not so much loyal to the Crown as the half-crown. Maybe they will look more positively on the idea after suffering the very real economic effects of Brexit for a few years. A decision Eurosceptical unionists voted for in large numbers.

And in a decade’s time, perhaps we will look back and see these past few weeks were the beginning of the end for Northern Ireland.
 

Kevin Meagher is associate editor of Labour Uncut and a former special adviser at the Northern Ireland office.