Cameron warns Labour: if you oppose HS2, we'll cancel it

After renewed speculation that Labour will come out against the project, the PM warns that it "can't go ahead without all-party support".

The report in today's Sun that Ed Balls has been given the final say over whether Labour supports High Speed 2 has prompted further speculation that the party is preparing to come out against the project. It was Balls who moved to Labour to a more sceptical position when he said in his conference speech that it needed to consider whether it was "the best way to spend £50 billion for the future of our country".

Interviewed today on 5 Live, he warned: 

If the case is clear, the benefits are strong, it’s the best way to spend the money and the costs are under control, at that point I would be happy to say we’ll support it. But what I am not going to do is say we support it when the costs are rising, the benefits are unclear and the government are acting like cheerleaders rather than proper stewards of public money. That is not a road I am going to go down.

For the shadow chancellor, the attraction of a U-turn on HS2 is that would allow Labour to outspend the Tories in politically vital areas ("building new homes or new schools or new hospitals") while also remaining within George Osborne's fiscal envelope. 

But now, in a dramatic attempt to call Labour's bluff, David Cameron has warned that the project "can't go ahead without all-party support". At a press conference in Brussels he said:

It [HS2] does have all-party support. We supported it in opposition when Labour were in Government; Labour support it today, as I understand it, now we are in government; the Liberal Democrat party support it as well.

And that is all to the good because these multi-year, multi-parliament infrastructure projects, they can’t go ahead without all-party support – you won’t get the investment, you can’t have the consistency.

In other words, if the opposition comes out against HS2, the government will cancel it and pin the blame on Labour (on the basis that a 20-year project can't be sustained without bipartisan support). This would also allow the Tories and the Lib Dems to suggest their own uses for the £50bn budget, reducing the political advantage to Labour. But if Balls and Miliband believe that they would spend the money more wisely than the Tories, Cameron's intervention may not be enough to save HS2. 

A placard placed by the Stop HS2 Campaign sits in a hedegrow near to the planned location of the new high speed rail link in Knutsford. 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