The Obama polling that inspired Labour's cost of living offensive

While Romney led on managing the economy and reducing the deficit, Obama led on living standards. Labour believes the latter is the key to victory in 2015.

Before Ed Miliband announced his plan to freeze energy prices for 20 months from May 2015, he and his aides knew that it would "be big". They had long been struck by polling showing that rising gas and electricity bills were voters’ primary concern, ranked above wages, employment and housing. But even they have been surprised by the extent to which the policy has defined political debate since the conference season. Three weeks on from Miliband’s speech, the Labour leader's team believe it has had even more impact than George Osborne’s 2007 pledge to raise the inheritance tax threshold to £1m, with "huge cut through to the public" in the words of one aide. (A poll published yesterday showed that voters rate it above all the other policies announced by the parties during the conference season.) To their satisfaction, the Tories have struggled to settle on a consistent line of attack, unsure whether to dismiss it as a "gimmick" or as dangerously "left-wing", or to match it in some form.

The policy was devised by Greg Beales (jokingly named "Mr Freeze" by his colleagues), Miliband’s director of strategy and planning, who had long urged the party to shift its focus away from the macroeconomy and towards living standards. It was a reorientation inspired by Barack Obama’s 2012 election campaign. In meetings with the Labour team in London and Washington DC, Obama aides including his pollster Joel Benenson emphasised how important the president’s stance on living standards had been to victory in tough times. A report on the election by the veteran Democrat Stan Greenberg for Miliband pointed to polls showing that while Mitt Romney had led on "handling the economy"(51-44%) and "reducing the federal budget deficit" (51-37%), Obama had led on understanding "the economic problems ordinary people in this country are having" (51-43%) and on "looking out for the middle class" (51-40%).

This left-right split is mirrored in the UK, where a recent ComRes poll found that voters think the Conservatives (42%) are more likely than Labour (33%) to maintain economic growth and keep public spending under control (47-28%), but also that they believe their own family would be better off under Labour (41-31%).

Labour is confident this trend will favour it in 2015. As the economy enters a post-crisis phase, the party believes voters will become less concerned with macro issues and more concerned with whether their family is sharing in the proceeds of growth.

After missing their original target of eliminating the structural deficit in one parliament, the Tories have sought to turn economic failure into political success by emulating Obama’s 2012 campaign message and urging voters to let them "finish the job". But they have failed to recognise that Obama was referring not to government borrowing but to living standards. As for the warning "not to give the keys to the guys who crashed the car in the first place" – similarly inspired by the US president – a Labour aide pointed out to me that Obama "actually ran on that line in the 2010 midterms and it was a disaster".

The Tories have derided Miliband’s focus on the "cost of living" as a distraction from the primary task of "fixing" the economy, but this message is ill suited to a time when 11 million people have had no increase in their real earnings since 2003. Aware of this, the Tories are preparing a barrage of cost-of-living measures for the Autumn Statement but, more than at any other point since 2010, they will be forced to fight on enemy territory. 

Barack Obama waves to supporters after his victory speech at McCormick Place on election night November 6, 2012 in Chicago, Illinois. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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In your 30s? You missed out on £26,000 and you're not even protesting

The 1980s kids seem resigned to their fate - for now. 

Imagine you’re in your thirties, and you’re renting in a shared house, on roughly the same pay you earned five years ago. Now imagine you have a friend, also in their thirties. This friend owns their own home, gets pay rises every year and has a more generous pension to beat. In fact, they are twice as rich as you. 

When you try to talk about how worried you are about your financial situation, the friend shrugs and says: “I was in that situation too.”

Un-friend, right? But this is, in fact, reality. A study from the Institute for Fiscal Studies found that Brits in their early thirties have a median wealth of £27,000. But ten years ago, a thirty something had £53,000. In other words, that unbearable friend is just someone exactly the same as you, who is now in their forties. 

Not only do Brits born in the early 1980s have half the wealth they would have had if they were born in the 1970s, but they are the first generation to be in this position since World War II.  According to the IFS study, each cohort has got progressively richer. But then, just as the 1980s kids were reaching adulthood, a couple of things happened at once.

House prices raced ahead of wages. Employers made pensions less generous. And, at the crucial point that the 1980s kids were finding their feet in the jobs market, the recession struck. The 1980s kids didn’t manage to buy homes in time to take advantage of low mortgage rates. Instead, they are stuck paying increasing amounts of rent. 

If the wealth distribution between someone in their 30s and someone in their 40s is stark, this is only the starting point in intergenerational inequality. The IFS expects pensioners’ incomes to race ahead of workers in the coming decade. 

So why, given this unprecedented reversal in fortunes, are Brits in their early thirties not marching in the streets? Why are they not burning tyres outside the Treasury while shouting: “Give us out £26k back?” 

The obvious fact that no one is going to be protesting their granny’s good fortune aside, it seems one reason for the 1980s kids’ resignation is they are still in denial. One thirty something wrote to The Staggers that the idea of being able to buy a house had become too abstract to worry about. Instead:

“You just try and get through this month and then worry about next month, which is probably self-defeating, but I think it's quite tough to get in the mindset that you're going to put something by so maybe in 10 years you can buy a shoebox a two-hour train ride from where you actually want to be.”

Another reflected that “people keep saying ‘something will turn up’”.

The Staggers turned to our resident thirty something, Yo Zushi, for his thoughts. He agreed with the IFS analysis that the recession mattered:

"We were spoiled by an artificially inflated balloon of cheap credit and growing up was something you did… later. Then the crash came in 2007-2008, and it became something we couldn’t afford to do. 

I would have got round to becoming comfortably off, I tell myself, had I been given another ten years of amoral capitalist boom to do so. Many of those who were born in the early 1970s drifted along, took a nap and woke up in possession of a house, all mod cons and a decent-paying job. But we slightly younger Gen X-ers followed in their slipstream and somehow fell off the edge. Oh well. "

Will the inertia of the1980s kids last? Perhaps – but Zushi sees in the support for Jeremy Corbyn, a swell of feeling at last. “Our lack of access to the life we were promised in our teens has woken many of us up to why things suck. That’s a good thing. 

“And now we have Corbyn to help sort it all out. That’s not meant sarcastically – I really think he’ll do it.”