David Cameron at the annual Confederation of British Industry (CBI) conference on 10 November. Photo: Getty
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Leader: David Cameron has no answers to the global crisis he describes

While highlighting dangers abroad, Cameron ignores those at home, including the long decline in living standards, the lack of investment and an overheated London property market.

Even before the damage from the last economic crisis has been repaired, the danger is growing of another. After briefly showing signs of recovery in 2013, the eurozone has slumped back into stagnation. Meanwhile, Japan has entered recession again, growth in China is slowing down and geopolitical threats proliferate.

David Cameron’s warning that “red lights are flashing on the dashboard of the global economy” was justified, even if his motives were primarily political. It is in the interests of the Conservatives for voters’ attention to be concentrated on this issue, rather than immigration, on which Ukip leads, and on the NHS, on which Labour does. By alerting the electorate that the storm has not passed, Mr Cameron aims to persuade them not to take a chance on the opposition at the general election. The hope is that a vote for Labour will appear too risky and that a vote for Ukip will appear too frivolous.

But if the Prime Minister’s jeremiad was politically astute it was also disingenuous. Having blamed the 2008 crisis on Labour’s profligacy, rather than global forces, he cannot now reasonably cite the same conditions as an alibi for the coming UK slowdown. While highlighting the dangers abroad, he ignores those at home, including the long decline in living standards, the lack of public and private investment and an overheated London property market.

Mr Cameron is correct to note the harm inflicted on Britain by the parlous state of the eurozone, our largest trading partner, but refuses to add that this results not from an absence of austerity (the policy he promotes for growth) but from a dangerous excess. As Mehdi Hasan writes on page 33, Europhiles should question their faith in an EU that has done so much to choke off demand in member states and so little to support it.

In these circumstances, voters in the UK and elsewhere are easily susceptible to populists and demagogues who seek to demonise immigrants. Politicians have spent a decade complaining that we do not talk about the issue. The truth is that many voters hear about little else. By too often reinforcing the myths about immigration, rather than challenging them, the two main parties jointly ensure that Ukip is the main beneficiary. No voter who heard Labour’s panicky pledge to ban migrants from claiming out-of-work benefits for two years after their arrival and to limit tax credits for those in employment would be reminded that migrants contribute considerably more in taxes than they receive in welfare payments. An OECD report last year, for instance, found that they make a net contribution to the UK of 1.02 per cent of GDP or £16.3bn, because they are younger and more economically active than the population in general.

The truth, which almost no politician will dare utter, is that Britain will need more, rather than fewer, immigrants in the future to meet the challenge of an ageing population. The Office for Budget Responsibility forecasts that should the UK maintain net migration of roughly 140,000 a year (significantly higher than the government’s target of “tens of thousands”), debt will rise to 99 per cent of GDP by 2062-2063. But should it cut net migration to zero, debt will reach 174 per cent.

The Conservatives never miss an opportunity to boast of their “long-term economic plan” and their commitment to balanced growth. But the gap between rhetoric and reality has seldom been greater. Fixated on their ideological commitment to achieve a budget surplus by the end of the next parliament, the Tories offer none of the innovative thinking required to remake the British economy for this new insecure era. After Mr Cameron’s cynical promise of £7bn of tax cuts, even their devotion to fiscal restraint is now questionable.

Rather than managing decline, both Britain and the eurozone need an ambitious programme for growth. In the absence of economic leadership, the world is likely to remain at best trapped in what Keynes called “the long, dragging conditions of semi-slump” and at worst caught in the rapids of another global crisis. 

This article first appeared in the 20 November 2014 issue of the New Statesman, The deep roots of Isis

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Keir Starmer MP: Choosing ideological purity before power is a dereliction of duty

The former director of public prosecutions believes getting involved with Brexit negotiations is crucial. 

 

Three weeks after Brexit, Keir Starmer held a public meeting in his London constituency of Holborn and St Pancras. “We had hundreds turning up,” he remembered. “The town hall was absolutely packed - it was standing room only and we had to turn people away. We haven’t had a public meeting of that size for some time.”

When it comes to Brexit, Starmer is an obvious Labour asset. Director of public prosecutions from 2008 to 2013, he has the legal background to properly scrutinise an EU deal. His time spent as a shadow immigration minister means he understands some of the thorniest problems facing negotiators.

But instead, the MP finds himself on the shadow back benches.

“My decision to resign was driven by Jeremy’s decision on the referendum,” he told The Staggers. “I was particularly troubled by his suggestion that we should invoke Article 50 straight away, and start the exit process [Corbyn has since backtracked on this suggestion]. 

“That is not for me a question of left-right politics. When he said that, I felt he was in fundamentally a different place from me in terms of how we fight for the future of our country.”

Starmer is not a man to enjoy life in opposition, and he has little time for airy promises. “Jeremy talks of dealing with inequality and housing projects, and a fairer society - all of which I would agree,” he said. “What I haven’t seen is the emergence of detailed policy that would get us to these places.”

He also gives purists in the party short shrift. “I would reject wholeheartedly any notion of a Labour Party that is not committed to returning to power at the first opportunity,” he said. “Of course that needs to be principled power. But standing on the sidelines looking for the purest ideology is a dereliction of the duty for any Labour member.”

Starmer believes Labour should be joining Scottish and Northern Irish leaders in trying to influence Brexit negotiations. He sees the time before invoking Article 50, the EU exit button, as crucial. 

Nevertheless, the man named after the Scottish founder of Labour, Keir Hardie, is pessimistic about the future of the UK. 

“It is going to be increasingly difficult to resist a further referendum in Scotland,” he said. “It will be increasingly difficult to keep Scotland as a part of the UK. I hope that doesn’t happen, but everyone knows David Cameron has put that at risk.”

Starmer may be a London MP, but he follows events in the rest of the country closely. While still in his shadow cabinet post, he embarked on a countrywide tour to learn more about attitudes to immigration.  

He condemns the increase in racist attacks post-Brexit as “despicable”, but insists there is “a world of difference” between these and genuine concerns about resources. “If you lose your job because there has been an influx of labour from another country, that is a legitimate cause for concern.”

He is equally scathing about the Government’s net migration cap. “If immigration is simply seen as a numbers game, nobody will ever win that debate,” he said. “The question should be: what is it we want to achieve?

“What do we expect of those who are arriving? What is the basic deal?”

In January, Starmer visited the informal camps in Calais and Dunkirk. “What I saw in Calais was appalling,” he said. “It is an hour from London. 

“To see families and children in freezing, squalid conditions without any real hope of a positive outcome was enough to make anybody think: ‘This is not the way to solve the refugee crisis.’”

The new PM, Theresa May, built her reputation on a rigid asylum policy, but Starmer believes a strong opposition can still force change. “If you take the Syrian resettlement scheme, that started life as a scheme for victims of sexual violence,” he said. “When pushed, it became a scheme for 20,000 Syrians but not if they reached Europe. When pushed, the Government accepted the case for some unaccompanied children in Europe to come to this country. 

“Labour needs to keep pushing.”

For now, though, Labour is divided. Starmer has been tipped as a future leader before, in 2015, but declined to run because of a lack of political experience. One year and a Brexit on, he certainly has some of that under his belt. But he rules himself out of the current leadership challenge: “I am 100 per cent behind Owen.” What will he do if Jeremy Corbyn wins? “Let’s cross each bridge when we come to it.”

Starmer is clear, though, that Labour can only win an election if it comes up with a more ambitious project, an economy with purpose. And the Brexit negotiations provide an opportunity. “We have to ask ourselves,” he said. “Do we simply want a series of trade agreements, the more the merrier? Or do we want deals that achieve certain ends? It is a moment to recast the future.”