Why Liam Byrne is set to be ditched in Miliband's reshuffle

Just as only Nixon could go to China, so only a leftist can sell Labour's new position on welfare to a sceptical PLP.

After acidly remarking that "when the Labour battle bus should be revving up, it is parked in a lay-by of introspection", Maurice Glasman is now offering Ed Miliband advice on what is becoming an increasingly important test of his leadership: next month's shadow cabinet reshuffle. The Labour peer, who was ennobled by Miliband in 2011, suggests in today's Times that his party's leader should replace shadow work and pensions secretary Liam Byrne with contrarian backbencher Frank Field (who responded by describing it as a "good idea").

For several reasons, it's a trade Miliband won't be making. As a 71-year-old former New Labour minister, Field is exactly the kind of "greybeard" that the Labour leader wants to avoid bringing back and his policy proposals (he has called for Labour to outflank the Tories by proposing a lower benefit cap) would be anathema to the Parliamentary Labour Party. Tony Blair famously appointed Field as social security minister in 1997 with an invitation to "think the unthinkable", only for Field to resign the following year when the "unthinkable" turned out to be unacceptable. It is not a mistake that Miliband will be repeating. 

But where Glasman is right is in suggesting that Byrne is unlikely to be in his brief after the reshuffle. In the words of one Labour MP, he has "badly lost the confidence of the PLP" and Miliband's team were furious when he recently fractured the delicate welfare compromise negotiated by the leader by attacking the coalition's benefit cap as too soft, declaring that "ministers have bodged the rules so the cap won’t affect Britain’s 4,000 largest families and it does nothing to stop people living a life on welfare." I'm told that the intervention was unauthorised by Miliband's office and was regarded as "deeply unhelpful". 

The view among many in the party is that if Labour is to reach a position on welfare that both its MPs and the electorate can live with, then it is essential for Miliband to appoint a shadow work and pensions secretary who is trusted by backbenchers. Just as only Nixon could go to China, so only a leftist can sell Labour's new position on welfare to a sceptical PLP. 

But should Byrne be removed the shadow cabinet, it will allow the Tories to revive their favourite charge - that it's Len McCluskey who calls the shots in Labour. The shadow work and pensions secretary was one of the "Blairites" that the Unite general secretary famously suggested should be sacked or ignored in his interview with me earlier this year. He told me: "Byrne certainly doesn’t reflect the views of my members and of our union’s policy. I think some of the terminology that he uses is regrettable and I think it will damage Labour. Ed’s got to figure out what his team will be." Few in Labour would now dissent from that view. 

Shadow work and pensions secretary Liam Byrne speaks at the Labour conference in Liverpool in 2011. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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By refusing to stand down, Jeremy Corbyn has betrayed the British working classes

The most successful Labour politicians of the last decades brought to politics not only a burning desire to improve the lot of the working classes but also an understanding of how free market economies work.

Jeremy Corbyn has defended his refusal to resign the leadership of the Labour Party on the grounds that to do so would be betraying all his supporters in the country at large. But by staying on as leader of the party and hence dooming it to heavy defeat in the next general election he would be betraying the interests of the working classes this country. More years of Tory rule means more years of austerity, further cuts in public services, and perpetuation of the gross inequality of incomes. The former Chief Secretary to the Treasury, Seema Malhotra, made the same point when she told Newsnight that “We have an unelectable leader, and if we lose elections then the price of our failure is paid by the working people of this country and their families who do not have a government to stand up for them.”

Of course, in different ways, many leading figures in the Labour movement, particularly in the trade unions, have betrayed the interests of the working classes for several decades. For example, in contrast with their union counterparts in the Scandinavian countries who pressurised governments to help move workers out of declining industries into expanding sectors of the economy, many British trade union leaders adopted the opposite policy. More generally, the trade unions have played a big part in the election of Labour party leaders, like Corbyn, who were unlikely to win a parliamentary election, thereby perpetuating the rule of Tory governments dedicated to promoting the interests of the richer sections of society.

And worse still, even in opposition Corbyn failed to protect the interests of the working classes. He did this by his abysmal failure to understand the significance of Tory economic policies. For example, when the Chancellor of the Exchequer had finished presenting the last budget, in which taxes were reduced for the rich at the expense of public services that benefit everybody, especially the poor, the best John McConnell could do – presumably in agreement with Corbyn – was to stand up and mock the Chancellor for having failed to fulfill his party’s old promise to balance the budget by this year! Obviously neither he nor Corbyn understood that had the government done so the effects on working class standards of living would have been even worse. Neither of them seems to have learnt that the object of fiscal policy is to balance the economy, not the budget.

Instead, they have gone along with Tory myth about the importance of not leaving future generations with the burden of debt. They have never asked “To whom would future generations owe this debt?” To their dead ancestors? To Martians? When Cameron and his accomplices banged on about how important it was to cut public expenditures because the average household in Britain owed about £3,000, they never pointed out that this meant that the average household in Britain was a creditor to the tune of about the same amount (after allowing for net overseas lending). Instead they went along with all this balanced budget nonsense. They did not understand that balancing the budget was just the excuse needed to justify the prime objective of the Tory Party, namely to reduce public expenditures in order to be able to reduce taxes on the rich. For Corbyn and his allies to go along with an overriding objective of balancing the budget is breathtaking economic illiteracy. And the working classes have paid the price.

One left-wing member of the panel on Question Time last week complained that the interests of the working classes were ignored by “the elite”. But it is members of the elite who have been most successful in promoting the interests of the working classes. The most successful pro-working class governments since the war have all been led mainly by politicians who would be castigated for being part of the elite, such as Clement Atlee, Harold Wilson, Tony Crosland, Barbara Castle, Richard Crossman, Roy Jenkins, Denis Healey, Tony Blair, and many others too numerous to list. They brought to politics not only a burning desire to improve the lot of the working classes (from which some of them, like me, had emerged) and reduce inequality in society but also an understanding of how free market economies work and how to deal with its deficiencies. This happens to be more effective than ignorant rhetoric that can only stroke the egos and satisfy the vanity of demagogues

People of stature like those I have singled out above seem to be much more rare in politics these days. But there is surely no need to go to other extreme and persist with leaders like Jeremy Corbyn, a certain election loser, however pure his motives and principled his ambitions.

Wilfred Beckerman is an Emeritus Fellow of Balliol College, Oxford, and was, for several years in the 1970s, the economics correspondent for the New Statesman