Grace under pressure: Jarvis on a tour in northern Iraq, where he was responsible for security in the critical Rumaila oilfields.
Show Hide image

From war to Westminster: is Labour's Dan Jarvis a future Prime Minister?

In 2007, Dan Jarvis led a unit of paratrooners in Helmand Province. Four years later, he became MP for Barnsley Central. Xan Rice meets him and asks: could he go even higher?

In 2007, four years before becoming a Labour MP, Major Dan Jarvis was asked to lead a company of 150 men on a six-month mission into Helmand Province in Afghanistan. His unit, mainly paratroopers, was part of the Special Forces Support Group, the newest wing of the UK special forces.

The full details of Jarvis’s task remain classified, but it involved recruiting and training local volunteers to serve in the Afghan Territorial Force, an elite unit charged with taking on the Taliban. Jarvis was 34 and highly experienced, having served in Kosovo, Northern Ireland and Sierra Leone and completed multiple tours in Afghanistan and Iraq. But he knew this mission would be his most dangerous and challenging yet.

On a previous deployment to Helmand in 2005, as part of a small reconnaissance team helping the British army decide where to focus its efforts in southern Afghanistan, he had been able to walk through the streets and bazaars. Now, with the insurgency raging, the only way in and out was by helicopter. Jarvis’s unit would be based at a remote fort. In desert terrain littered with improvised explosive devices and mines, the men would travel long distances in Land Rovers lined with ballistic matting – “basically a reinforced car seat”.

“The level of threat was very high and the level of protection relatively low,” is how Jarvis puts it. It was the sort of mission he had dreamed of. “I had aspired throughout my army career to lead a company of paratroopers in these very difficult circumstances,” he told me. “It was a fantastic professional opportunity.”

But Jarvis was conflicted. Unlike some of the younger men on his team, he had a family. When he first went to Iraq, in 2003, during the overthrow of Saddam Hussein, it was only two days after his wife, Caroline, had given birth to a son by emergency Caesarean section. Now he also had a young daughter, born just days before he had returned from another tour of Iraq. Caroline was aware of the risks her husband faced; he had known ten of the first 100 British soldiers killed in Afghanistan. And she was fighting her own battle, having been diagnosed with bowel cancer the previous year.

“Quite a reasonable question to ask is, ‘Why the hell were you in Afghanistan at that point?’” Jarvis says. “It was because Caroline had undergone treatment for cancer and was in remission, and it was her profound wish that we would maintain as normal a life as we possibly could.”

Three years later, in July 2010, Caroline died from the disease at the age of 43.

The Helmand operation was as tough as Jarvis had expected. Vetting the Afghans was hazardous: the British soldiers never knew if people were coming forward for the right reasons. The “green on blue” attacks by Afghan forces on allied troops were just beginning. Jarvis also had to balance the military objectives with his desire to bring back all of his troops.

During the assignment, one Afghan soldier was killed and several others were injured. Some of Jarvis’s own men were badly hurt. But none died, which makes him immensely proud. “Those were formative times for me, frankly compounded by the constant self-doubt as to whether I should have been in that country,” says Jarvis, now a shadow justice minister. “It gives me perspective that I draw upon because, how ever tough things can be in politics, nothing will compare to that level of pressure and risk.”

In Jarvis’s constituency office at Barnsley Town Hall his staff joke about his fondness for military acronyms and mottos. When he writes RPE on a memo it means “relentless pursuit of excellence”. R&R is “ruthless and relentless”. “Ruthless with time,” Jason Keen, his press officer, clarifies.

I’ve arranged to meet Jarvis for a run at 8am on a late February morning. At 7.50am he is waiting outside the Premier Inn in the centre of Barnsley. “I thought we’d go out for an hour or so, a steady run,” he says. “One thing I must tell you is that it is hilly around here.”

Jarvis is training for the London Marathon, as I am. Or at least he should be. It’s only nine weeks to go until the race and he has managed a total of two practice runs. With the event due to take place just a fortnight before the general election, he would have been happy to skip it.

But since Caroline’s death, Jarvis has twice run the marathon for Cancer Research UK and it is the headline charity this year. Matching his time from 2014 will be hard, he says – he ran with his father and finished in three hours and 45 minutes – though he has no trouble answering questions as we run up a steep gradient. “You do 15 years in the Paras and you develop a bit of a mindset of getting tough at experiences,” he says. “There comes a point when the embarrassment of failure is much worse than the pain associated with trying to avoid failure.”

His lack of preparation is not laziness; he has little spare time. From Monday morning to Thursday night he is London, where he likes to be at his computer by 6am and finishes around midnight. Friday is a full day of constituency work in Barnsley and so is half of Saturday.

“I remember on my first day in the House of Commons [7 March 2011] a Conservative MP said to me: ‘The thing that you need to learn about this place is that it is only really a part-time job.’ I was pretty stunned to hear that and it’s completely not the case. You can potter around and do it as a part-time job if you want, but to do it effectively requires a huge amount of effort. I think people deserve that. I am not making any comment about whether I am effective or not. I think people will see that I put the work in.” (Three days later the Conservative MP Malcolm Rifkind is caught on a hidden camera saying he is “self-employed” and boasting about his free time.)

Jarvis arrived at Westminster as an outsider in both background and timing. He was not part of the Labour class of 2010 – he won his seat in Barnsley Central in 2011, replacing Eric Illsley, who had to stand down after being convicted of fraud for his part in the MPs’ expenses scandal. In doing so, Jarvis became the first person since the Second World War to resign a military commission to contest a by-election. Since then, his rise through the ranks – and in his standing among his peers on both sides of the House – has been swift.

Jarvis did not want to be typecast and so deliberately avoided being pushed towards defence and security. But he was eager to be challenged. After six months he agreed to become shadow arts minister, even though he says he knew little about culture. In parliament he drew attention for his robust defence of local libraries against the coalition cuts, and for championing the National Health Service, describing the excellent care his wife had received.

Jarvis is affable, relaxed and the same time deeply serious about his job as an MP and the concept of public service. Some things he professes to doing – such as a ritual pause to consider his constituents every time he steps into the Commons – could sound ridiculous, yet from him they feel sincere. “He comes across as a very real, authentic person, and that’s important in modern politics,” as Rory Stewart, the Conservative MP, writer and chair of the Commons defence select committee, who has worked with Jarvis in parliament, told me.

His value to his party is clear. Last year Jarvis edited a book called Why Vote Labour, part of a series explaining the main parties’ policies. And few Labour MPs can have knocked on as many doors as he has done in recent months. In January, he spent nine days touring 27 constituencies to assist the local candidates. It was a strong statement of loyalty and perhaps of ambition, too.

Writing at the time in the Telegraph, James Kirkup, the paper’s executive editor for politics, again noted the Tories’ respect for Jarvis and said he should be spoken of as serious leadership material. “How would the CCHQ attack machine approach a Labour leader who served his country in two wars? A man who is raising two children alone after losing his wife to cancer?”

The second line was incorrect: Jarvis remarried in 2013 to Rachel, a freelance graphic designer, and now has a third child. But the point was well made: Ladbrokes has Jarvis at 12/1 to be the next Labour leader, behind Andy Burnham, Yvette Cooper and Chuka Umunna. His ability to perform under extreme pressure may well be tested again before too long.

Military men are typically Tory supporters. The Conservatives have numerous MPs with army backgrounds, mostly with short periods of service. Labour has one – Jarvis – and with arguably the highest profile of all. (In 2011 he was awarded an MBE for military service, the only serving MP to achieve that honour during the Queen’s reign.)

Why did he choose Labour? It was not a sudden decision, he says. His parents were both Labour Party members; his father was a lecturer at a teacher training college in Nottingham and his mother a probation officer. They instilled in him the importance of public service. While still at school he came to the conclusion that he did not share Margaret Thatcher’s vision for Britain.

“The values of Labour are my values – the fundamental belief that collectively you achieve more together than you can alone,” he says. “The belief in the value of fairness, equality, the desire to stand up for the many, not just the few – giving representation to those without a voice.”

Jarvis became a member of the Labour Party while studying international politics at Aberystwyth University. By then he had already decided to become a soldier. Nobody in his family had served in the armed forces, so it was a “minor act of rebellion”, he says now. “I worked out early on that what you do for a job is an important part of your life. So do something you think is worthwhile and that gives you an opportunity to make a contribution.”

The army appealed to his sense of adventure. As one holiday approached at university, he and his younger brother, Rob, looked for something to do. “Some students went to Ibiza,” Jarvis says. “We went to K2” – the world’s second-highest mountain. Wearing their grandfather’s old tweed coats they made it up to 6,500 metres before accepting that they did not have the skills or equipment to climb higher. (Rob is now a professional mountain guide in Chamonix.)

After a year as a cadet at Sandhurst in 1997, Jarvis joined the Parachute Regiment. In Kosovo, he was appointed aide-de-camp to General Sir Mike Jackson, the head of the UN force there. When Jackson returned to England in 2000 Jarvis accompanied him. He met Caroline at Jackson’s home in Wiltshire, where she worked as the family chef. They married the following year.

It was in Afghanistan in 2005, while following the UK general election at the end of a tour, that he first seriously considered a career in parliament. “My wife had not yet been diagnosed with cancer. I concluded that at some point, probably years ahead, I’d want to ease out of the army and get more involved in politics. My wife’s death accelerated that process.”

He has said that telling his children that their mother had died was the most difficult thing he has done. “It’s been hard for them. The only kind of minor saving grace was the fact my kids were so young [seven and five]. The magnitude of it was not completely lost, but if they had been the age they are now it would have been harder.

“It’s just one of those dreadful situations that you find yourself in and you’ve got two options: you can come through it or you can sink. Sinking was never an option because I had two small kids who wanted to go back to school quite quickly.”

He knew he could not return to war zones. But he did not want a desk job in the army. He quietly applied to be Labour’s candidate in Islwyn, south Wales, in 2010 and made the shortlist. The following year, the Barnsley Central seat became vacant.

Dan Jarvis, photographed in Barnsley this month by Rick Pushinsky.

Jarvis thought he stood little chance. The town has a long history of coal mining and union ties; on our run, we passed the house owned by Arthur Scargill, who Jarvis says is now a recluse. Every local MP for the previous 70 years had been from Barnsley or nearby, and most had been miners. And Nottingham, where Jarvis is from, is still associated with miners who kept working during the great strike of the mid-1980s.

“The only thing in my favour was that my predecessor was going to prison and there was huge discontent with the political classes. As someone untouched by all that, with a proven track record of service, I thought maybe I could be considered.”

He won selection through hard work and luck; at one point in the hustings when he tied with another candidate, they drew lots to see who would proceed. The by-election was more of a formality, as Barnsley Central is a safe Labour seat. But Jarvis was determined to make a point. He code-named his campaign “Operation Honey Badger” – the animal looks cuddly but is known for its strength and ferocity – and knocked on several thousand doors. He won 61 per cent of the vote, compared to the 47 per cent that Illsey had polled for Labour a year earlier.

After his victory, Jarvis moved the family home from Salisbury in Wiltshire to Barnsley. “Some people [MPs] decide that they want to be based in London,” he says. “I wanted to be rooted here. The kids are very settled and love the town.”

Initially, his parents – now divorced and both remarried – and his in-laws helped look after the children. Now Rachel takes care of most of the parental duties. Jarvis’s 12-year-old son and ten-year-daughter attend local state schools. “A bit of me thinks that it is kind of selfish for me to do it [being an MP and spending so much time away from home] . . . But we make it work.”

He thinks his children are proud that he is a politician, although his son was more impressed when he was soldier. They will help him campaign closer to the election in May.

Jarvis says Barnsley still suffers from misconceptions, with many people assuming that it is a heavily industrialised urban area. The last of the coal pits closed decades ago and three-quarters of the borough is green belt. The M1 passes close to the town and the Peak District is nearby.

Yet there are challenges. Barnsley Central is the 132nd worst of Britain’s 650 constituencies for unemployment. Underemployment is also a problem, with people who want permanent work having to settle for zero-hours or other part-time contracts.

“A lot of people are really struggling at the moment, making hard choices. This talk of an economic recovery: it’s a very different climate in London from the rest of Britain. In swaths of the country people are worse off by every metric than they were in 2010.”

Yet the Tories lead when it comes to economic stewardship and Labour is considered less friendly – even unfriendly – to business. Why is this?

“It’s because there is an election!” Jarvis says. “There are some clever election strategists paid a lot of money to run us down. There’s an absolute recognition [by Labour] that the private sector is an important part of the economy and that we can encourage business people to create wealth.”

I ask him about Ed Miliband: why are his approval ratings so poor? Opposition leaders have it tough compared to prime ministers, who have the benefit of incumbency, he says. Before they became prime minister, Jarvis recalls, Tony Blair was called “Bambi” and David Cameron was mocked for hugging huskies and cycling to work with his chauffeur behind him.

“When I talk to people about Ed, they do see him as a decent, well-meaning politician. But there is constant scrutiny upon him. I am not going to blame it all on the media but I think there’s a basic unfairness in the way the media have covered him. My take on Ed Miliband is that he’s an incredibly bright, thoughtful, decent guy who is doing the job for the right reasons.”

It’s now late morning and Jarvis is in his campaign gear: blue suit, comfortable brown walking shoes and a black waterproof jacket. As we approach the main shopping district, one of his constituents grips his hand and says: “We will beat Farage.”

Ukip isn’t a strong threat in Barnsley Central but it is in other areas nearby, including Rotherham. Labour supporters and politicians are concerned. (Later, Jarvis tells me that although the online version of Why Vote Labour initially sold better than the Conservative, Lib Dem and Ukip titles, the Ukip book is now the biggest seller. “Not that I’m competitive,” he says.)

“I am not remotely complacent about Ukip. They have successfully tapped in to a broader discontent about politics and politicians,” he says. But he thinks that support for Ukip has peaked. “They don’t have the momentum that they had at the time of the EU elections” in May last year.

The main market is busy with shoppers. Jarvis stops to talk to two female police officers and asks if they are having a quiet morning. “We don’t say the Q word!” one of
them replies in mock anger. They talk about the problem of local shops offering “legal highs”, products containing chemical substances that produce similar effects to cocaine or cannabis but not covered by current misuse of drugs laws. Jarvis is working with the government to have them banned.

We eat lunch at an Italian family restaurant. Out of earshot of Jarvis, I ask the two young waitresses if their MP is representing them well. The first says yes; she recognised him when he walked in. The second has no idea who her representative at Westminster is, and is only humouring me with an answer. “She [sic] is doing a good job,” the waitress says.

Jarvis chuckles when I tell him. I ask him what has gone wrong. “Many people think that our problems have outgrown our politics,” he says. “They feel lost in this rapidly changing world. Globalisation offers many opportunities but many challenges as well. We’ve seen how an economic crisis that had its roots on the other side of the world has had a direct impact on the livelihoods of people in this country and in my constituency. Technological improvements mean there is not as much of a role for those previously unskilled opportunities, so that brings pressures and challenges.”

The “established political order” also bears blame, he says. “Far too many politicians would never dream of knocking on people’s doors to ask them what they think. In many of the heartlands, Conservative and Labour, people sat on these big majorities and didn’t need to put the work in. The public was something of an afterthought. This has led to a breakdown of trust.

“Some people will try to simplify it and say it’s the expenses scandal. But that’s a tiny part of all this. Over many years there’s been a gradual separation between the political establishment and the people that they are there to serve.”

If the public’s confidence is to be won back, parliament needs to change. There are too few working-class people, too few women and too many career politicians, he says. “The public wants more people with life experience.”

He mentions one of Barnsley’s best-known MPs, Roy Mason, who worked underground as a coal miner at 14 and went on to represent the town from 1953 to 1987. “I suspect what he did would be much harder to do now and it’s a question of social mobility. It’s what gets me out of bed in the morning: that kids who grow up here should have the same opportunities as those children in more affluent areas.”

I ask if he thinks what the New Statesman has called the 7 per cent problem – the domination of public life by a privately educated minority, as well as the correlation between poverty and educational failure – is also an issue at Westminster. “There is an over-representation of people [in parliament] who have been to public schools. That is a fact of life that we should seek to address.

“It’s not to say we have not got exceptional people who went to public schools who can do exceptional things. But we need a parliament that is truly representative of the public that it is there to serve.”

Like Jarvis, Rory Stewart – who made his name as a diplomat and author of books on Afghanistan and Iraq – entered parliament as a political novice, winning a seat in 2010. In an interview with the American magazine the New Republic last year, Stewart said: “It is difficult to work out what an MP is, what an MP does, what the role of the public servant today is supposed to be. Is this a useful way of contributing, and shaping things? I guess before I did this, it seemed much more obvious.”

When I ask Jarvis about it, he says, “I mean this in an entirely complimentary way – Rory tends to overthink things.”

He expands: “I am pretty clear what I am here to do. I am there to champion my constituents and make sure their voices are heard and to stand up for them. I think I have learned a bit about how you get things done and how parliament works.”

There are frustrations. One is a consequence of being in opposition and not being able to influence government policy. Another dislike is the “political pantomime” of Prime Minister’s Questions. “When I go round the schools I cannot justify that level of behaviour to kids who see it and ask me about it. Some people say it makes it more of a spectacle and fewer people would watch if it was not that sort of confrontational environment. I don’t really buy that.”

In a 2012 interview with the Spectator, Jarvis expressed admiration for David Miliband, describing his role as vice-chairman of the Blairite think tank Progress as evidence of him “seeing the importance of the centre ground”. When I ask him about this, he says he is also a member of Unison, Unite, the Fabian Society and the Co-operative Party. “In politics there are those who will always try to pigeonhole you. I have frustrated people by not allowing them to do that, and been very careful not to be linked with any one bit of the party.”

I ask what he thinks of David Cameron. “I have a huge amount of respect for the office of the PM and it’s the most incredibly difficult job. While [Cameron] has always been personally charming to me, I don’t know what he is about and what he stands for. He has never convinced me that he gets up in the morning filled with some ideological vigour to make the country a better place. With a number of that cohort, it’s about holding and wielding the influence and power of office for its own ends, rather than for the greater good.”

Does he aspire to be PM? He must be aware of the talk of him as a future Labour leader? He pauses. “I don’t spend much time thinking about that, to be honest. I am utterly focused on winning the election and that Ed will be prime minister. The consequences of not doing so are severe for this country. It is said of Michael Heseltine that from school he had this grand plan that he was going to do a bit of time in the army, make money in business, go into politics, go into the cabinet and be prime minister. I am always suspicious of those sorts of people. I just want to do the best job that I can.”

With a close election predicted, one might have thought that Labour would be exploring the possibility of an alliance with the Liberal Democrats. Jarvis rejects this. “We need to do everything we can to avoid the scenario of going in with the Lib Dems. Our focus is on beating them, not war-gaming on a scenario that may or may not come.”

After lunch, Jarvis’s office manager drives us to Sheffield Hallam, Nick Clegg’s constituency. Polls show that the Labour candidate here, Oliver Coppard, is within a few percentage points of defeating Clegg. Coppard and a dozen volunteers are gathered at Crookes Social Club and when Jarvis arrives they fan out into the surrounding streets to campaign. Few people are at home. “It can be a bit soul-destroying, knocking on 15 doors when there’s nobody in,” Jarvis says.

When someone does answer, he introduces himself as a Labour member campaigning for Coppard. He only lets on that he is an MP when called over to chat to a woman who wants to join the party. He asks her why. “Ukip is getting more powerful and I find that really worrying,” she says. “The only good thing is that it is getting people angry and doing things.”

After 90 minutes, it’s time to go. Jarvis is dropped off at Sheffield Station and rushes to buy a ticket before boarding a crowded train to Barnsley. His monthly meeting with local Labour Party members begins at 5pm in the town hall. Though he will be late, he will not cancel; he has missed only two of these Friday-evening meetings in four years – once to get married and once to appear on Any Questions. In the morning he will be back on Barnsley’s streets, knocking on doors. “The honey badger,” he said on the way to the station, “lives on.” 

Xan Rice is features editor of the NS

Xan Rice is Features Editor at the New Statesman.

This article first appeared in the 06 March 2015 issue of the New Statesman, How Islamic is Islamic State?

MILES COLE
Show Hide image

The new Brexit economics

George Osborne’s austerity plan – now abandoned by the Tories – was the most costly macroeconomic policy mistake since the 1930s.

George Osborne is no longer chancellor, sacked by the post-Brexit Prime Minister, Theresa May. Philip Hammond, the new Chancellor, has yet to announce detailed plans but he has indicated that the real economy rather than the deficit is his priority. The senior Conservatives Sajid Javid and Stephen Crabb have advocated substantial increases in public-sector infrastructure investment, noting how cheap it is for the government to borrow. The argument that Osborne and the Conservatives had been making since 2010 – that the priority for macroeconomic policy had to be to reduce the government’s budget deficit – seems to have been brushed aside.

Is there a good economic reason why Brexit in particular should require abandoning austerity economics? I would argue that the Tory obsession with the budget deficit has had very little to do with economics for the past four or five years. Instead, it has been a political ruse with two intentions: to help win elections and to reduce the size of the state. That Britain’s macroeconomic policy was dictated by politics rather than economics was a precursor for the Brexit vote. However, austerity had already begun to reach its political sell-by date, and Brexit marks its end.

To understand why austerity today is opposed by nearly all economists, and to grasp the partial nature of any Conservative rethink, it is important to know why it began and how it evolved. By 2010 the biggest recession since the Second World War had led to rapid increases in government budget deficits around the world. It is inevitable that deficits (the difference between government spending and tax receipts) increase in a recession, because taxes fall as incomes fall, but government spending rises further because benefit payments increase with rising unemployment. We experienced record deficits in 2010 simply because the recession was unusually severe.

In 2009 governments had raised spending and cut taxes in an effort to moderate the recession. This was done because the macroeconomic stabilisation tool of choice, nominal short-term interest rates, had become impotent once these rates hit their lower bound near zero. Keynes described the same situation in the 1930s as a liquidity trap, but most economists today use a more straightforward description: the problem of the zero lower bound (ZLB). Cutting rates below this lower bound might not stimulate demand because people could avoid them by holding cash. The textbook response to the problem is to use fiscal policy to stimulate the economy, which involves raising spending and cutting taxes. Most studies suggest that the recession would have been even worse without this expansionary fiscal policy in 2009.

Fiscal stimulus changed to fiscal contraction, more popularly known as austerity, in most of the major economies in 2010, but the reasons for this change varied from country to country. George Osborne used three different arguments to justify substantial spending cuts and tax increases before and after the coalition government was formed. The first was that unconventional monetary policy (quantitative easing, or QE) could replace the role of lower interest rates in stimulating the economy. As QE was completely untested, this was wishful thinking: the Bank of England was bound to act cautiously, because it had no idea what impact QE would have. The second was that a fiscal policy contraction would in fact expand the economy because it would inspire consumer and business confidence. This idea, disputed by most economists at the time, has now lost all credibility.

***

The third reason for trying to cut the deficit was that the financial markets would not buy government debt without it. At first, this rationale seemed to be confirmed by events as the eurozone crisis developed, and so it became the main justification for the policy. However, by 2012 it was becoming clear to many economists that the debt crisis in Ireland, Portugal and Spain was peculiar to the eurozone, and in particular to the failure of the European Central Bank (ECB) to act as a lender of last resort, buying government debt when the market failed to.

In September 2012 the ECB changed its policy and the eurozone crisis beyond Greece came to an end. This was the main reason why renewed problems in Greece last year did not lead to any contagion in the markets. Yet it is not something that the ECB will admit, because it places responsibility for the crisis at its door.

By 2012 two other things had also become clear to economists. First, governments outside the eurozone were having no problems selling their debt, as interest rates on this reached record lows. There was an obvious reason why this should be so: with central banks buying large quantities of government debt as a result of QE, there was absolutely no chance that governments would default. Nor have I ever seen any evidence that there was any likelihood of a UK debt funding crisis in 2010, beyond the irrelevant warnings of those “close to the markets”. Second, the austerity policy had done considerable harm. In macroeconomic terms the recovery from recession had been derailed. With the help of analysis from the Office for Budget Responsibility, I calculated that the GDP lost as a result of austerity implied an average cost for each UK household of at least £4,000.

Following these events, the number of academic economists who supported austerity became very small (they had always been a minority). How much of the UK deficit was cyclical or structural was irrelevant: at the ZLB, fiscal policy should stimulate, and the deficit should be dealt with once the recession was over.

Yet you would not know this from the public debate. Osborne continued to insist that deficit reduction be a priority, and his belief seemed to have become hard-wired into nearly all media discussion. So perverse was this for standard macroeconomics that I christened it “mediamacro”: the reduction of macroeconomics to the logic of household finance. Even parts of the Labour Party seemed to be succumbing to a mediamacro view, until the fiscal credibility rule introduced in March by the shadow chancellor, John McDonnell. (This included an explicit knockout from the deficit target if interest rates hit the ZLB, allowing fiscal policy to focus on recovering from recession.)

It is obvious why a focus on the deficit was politically attractive for Osborne. After 2010 the coalition government adopted the mantra that the deficit had been caused by the previous Labour government’s profligacy, even though it was almost entirely a consequence of the recession. The Tories were “clearing up the mess Labour left”, and so austerity could be blamed on their predecessors. Labour foolishly decided not to challenge this myth, and so it became what could be termed a “politicised truth”. It allowed the media to say that Osborne was more competent at running the economy than his predecessors. Much of the public, hearing only mediamacro, agreed.

An obsession with cutting the deficit was attractive to the Tories, as it helped them to appear competent. It also enabled them to achieve their ideological goal of shrinking the state. I have described this elsewhere as “deficit deceit”: using manufactured fear about the deficit to achieve otherwise unpopular reductions in public spending.

The UK recovery from the 2008/2009 recession was the weakest on record. Although employment showed strong growth from 2013, this may have owed much to an unprecedented decline in real wages and stagnant productivity growth. By the main metrics by which economists judge the success of an economy, the period of the coalition government looked very poor. Many economists tried to point this out during the 2015 election but they were largely ignored. When a survey of macroeconomists showed that most thought austerity had been harmful, the broadcast media found letters from business leaders supporting the Conservative position more newsworthy.

***

In my view, mediamacro and its focus on the deficit played an important role in winning the Conservatives the 2015 general election. I believe Osborne thought so, too, and so he ­decided to try to repeat his success. Although the level of government debt was close to being stabilised, he decided to embark on a further period of fiscal consolidation so that he could achieve a budget surplus.

Osborne’s austerity plans after 2015 were different from what happened in 2010 for a number of reasons. First, while 2010 austerity also occurred in the US and the eurozone, 2015 austerity was largely a UK affair. Second, by 2015 the Bank of England had decided that interest rates could go lower than their current level if need be. We are therefore no longer at the ZLB and, in theory, the impact of fiscal consolidation on demand could be offset by reducing interest rates, as long as no adverse shocks hit the economy. The argument against fiscal consolidation was rather that it increased the vulnerability of the economy if a negative shock occurred. As we have seen, Brexit is just this kind of shock.

In this respect, abandoning Osborne’s surplus target makes sense. However, there were many other strong arguments against going for surplus. The strongest of these was the case for additional public-sector investment at a time when interest rates were extremely low. Osborne loved appearing in the media wearing a hard hat and talked the talk on investment, but in reality his fiscal plans involved a steadily decreasing share of public investment in GDP. Labour’s fiscal rules, like those of the coalition government, have targeted the deficit excluding public investment, precisely so that investment could increase when the circumstances were right. In 2015 the circumstances were as right as they can be. The Organisation for Economic Co-operation and Development, the International Monetary Fund and pretty well every economist agreed.

Brexit only reinforces this argument. Yet Brexit will also almost certainly worsen the deficit. This is why the recent acceptance by the Tories that public-sector investment should rise is significant. They may have ­decided that they have got all they could hope to achieve from deficit deceit, and that now is the time to focus on the real needs of the economy, given the short- and medium-term drag on growth caused by Brexit.

It is also worth noting that although the Conservatives have, in effect, disowned Osborne’s 2015 austerity, they still insist their 2010 policy was correct. This partial change of heart is little comfort to those of us who have been arguing against austerity for the past six years. In 2015 the Conservatives persuaded voters that electing Ed Miliband as prime minister and Ed Balls as chancellor was taking a big risk with the economy. What it would have meant, in fact, is that we would already be getting the public investment the Conservatives are now calling for, and we would have avoided both the uncertainty before the EU referendum and Brexit itself.

Many economists before the 2015 election said the same thing, but they made no impact on mediamacro. The number of economists who supported Osborne’s new fiscal charter was vanishingly small but it seemed to matter not one bit. This suggests that if a leading political party wants to ignore mainstream economics and academic economists in favour of simplistic ideas, it can get away with doing so.

As I wrote in March, the failure of debate made me very concerned about the outcome of the EU referendum. Economists were as united as they ever are that Brexit would involve significant economic costs, and the scale of these costs is probably greater than the average loss due to austerity, simply because they are repeated year after year. Yet our warnings were easily deflected with the slogan “Project Fear”, borrowed from the SNP’s nickname for the No campaign in the 2014 Scottish referendum.

It remains unclear whether economists’ warnings were ignored because they were never heard fully or because they were not trusted, but in either case economics as a profession needs to think seriously about what it can do to make itself more relevant. We do not want economics in the UK to change from being called the dismal science to becoming the “I told you so” science.

Some things will not change following the Brexit vote. Mediamacro will go on obsessing about the deficit, and the Conservatives will go on wanting to cut many parts of government expenditure so that they can cut taxes. But the signs are that deficit deceit, creating an imperative that budget deficits must be cut as a pretext for reducing the size of the state, has come to an end in the UK. It will go down in history as probably the most costly macroeconomic policy mistake since the 1930s, causing a great deal of misery to many people’s lives.

Simon Wren-Lewis is a professor of economic policy at the Blavatnik School of Government, University of Oxford. He blogs at: mainlymacro.blogspot.com

 Simon Wren-Lewis is is Professor of Economic Policy in the Blavatnik School of Government at Oxford University, and a fellow of Merton College. He blogs at mainlymacro.

This article first appeared in the 21 July 2016 issue of the New Statesman, The English Revolt