Labour is still pre-occupied with the 1992 defeat of Neil Kinnock. Photo: GERRY PENNY/AFP/Getty Images
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Labour’s past spectres, bringing on the Brexit, and the wisdom of the shoeless guru

Labour’s abiding problem is that it doesn’t think it really belongs in office and must therefore apologise for occasions when it was.

Were the Conservatives still talking in 2000 about 1992, when the Tory chancellor Norman Lamont, in a vain attempt to keep Britain in the Exchange Rate Mechanism (a precursor to the euro), raised interest rates from 10 per cent to 12 per cent and then to 15 per cent and finally back to 10 per cent within barely 24 hours? Not that I recall. Were they talking in 1982 about 1974, when Edward Heath, in an equally vain attempt to see off a miners’ strike, put the country on a three-day working week? I think not.

Yet here is a Labour leadership contest in which the contenders have begun by discussing whether Gordon Brown and Alistair Darling were guilty of overspending before the world financial crisis struck. The party should have buried this argument long ago. Lest we forget, public services were then so popular that the Tories promised to match Labour’s spending plans. And unlike Lamont and Heath, Labour ministers successfully dealt with the crisis that they confronted, not only rescuing British banking from collapse but persuading other countries to take similar action and then ­restoring economic growth by 2010.

It is, however, Labour’s fate always to be reliving the past: the “great betrayal” of 1931, the devaluations of 1949 and 1967, the 1978-79 Winter of Discontent, the 1983 “suicide note”, Liam Byrne’s “no money left” note in 2010. The Tories treat their disasters as mere aberrations. The message of the departing Tory chancellor Reginald Maudling to his Labour successor in 1964 – “Good luck, old cock. Sorry to leave it in such a mess” – was forgotten within a year. To listen to the Tories, you would think that Heath had nothing to do with them. A highly intelligent and politically aware young man once told me that he was 30 before he realised that the three-day week didn’t happen under Labour.

Labour’s abiding problem is that it doesn’t think it really belongs in office and must therefore apologise for occasions when it was. Tony Blair’s ambition was to turn it into the “natural governing party”. The test of that was whether it could bounce back quickly from the defeat it would inevitably suffer eventually. This uninspiring leadership contest, combined with the defeat that prompted it, shows how badly he failed.


Mr Blue Sky

For examples of what prospective Labour leaders should talk about, turn to Steve Hilton. Yes, that Steve Hilton, the shaven-headed, bicycling former provider of “blue-sky thinking” to David Cameron. He ­supported £25bn in welfare cuts and an end to unfair dismissal laws before, frustrated by Whitehall, he fled to California in 2012. Now, in a Sunday Times interview alongside an extract from his new book, More Human, he says: “Our democracies are increasingly captured by a ruling class that seeks to perpetuate its privileges”; governments listen only to those who have money; and it is “outrageous that we should tolerate a situation where people work incredibly hard yet can’t earn enough to live on”. He argues that, in return for a cut in business taxes, companies should pay the living wage. (Why didn’t Labour propose that?) He says that supermarkets and other big companies (he seems to hate Tesco particularly) should pay for the social and environmental damage they cause. He rails against “vast corporate machines that treat people as an afterthought whether they work for them, supply them or buy from them”.

I don’t agree with everything he says or even most of it. But this is the territory that Labour’s prospective leaders should explore.


Dead man’s shoes

Some Labour insiders suggest that the winner of this year’s contest should face a new leadership election in three years’ time. This sounds like a desperate device to insert
David Miliband, the “right” brother but not currently an MP. It occurs to me, however, that, since 1945, Labour has twice changed its leader in the middle of a parliament while in opposition. On both occasions, 1963 and 1994, the incumbent leader died (Hugh Gaitskell and John Smith). In both cases, Labour had performed below pre-poll expectations in the previous election, then went on to win a majority in the next. This little history lesson may be a bit of a downer for current leadership hopefuls but, in these challenging times, we must cling to those straws we can find.


From free trade to free-for-all

I was planning to vote in favour of Britain’s continuing EU membership, as I did (when it wasn’t the EU) in 1975. But I now think that, if Cameron recommends staying in, I shall vote against. With his small majority, he will make a pro-EU case only if he is sure that his Eurosceptic backbenchers won’t rebel. They want a deregulated Europe, in which countries compete to cut wages and taxes, reduce employees’ and consumers’ rights and abolish health, safety and environmental safeguards. That is what they mean by a pure free-trade area with no “interference” from Brussels. If an EU like that is in prospect, we should leave immediately.


Mansions of menace

Released from the terrors of Red Ed’s mansion tax, London’s high-end property market booms again. The Qatari ruling family, it is reported, has snapped up a six-storey Victorian town house in Mayfair for £40m and is close to creating a “Qatari quarter” in the area. As thrilling as it is to welcome such distinguished guests, instead of having Labour spurn them with its inhospitable taxes, I am just a little worried. The press is exercised about Islamist militants possibly being smuggled into Europe on flimsy refugee boats crossing the Mediterranean. But Qatar has been criticised for tolerating jihadist fundraisers and providing support, including weapons, to Middle Eastern militant groups. I am sure that Qatar’s rulers mean us no more harm than do the many genuine refugees trying to reach safety but are we quite sure that there’s no danger of an Islamist terrorist finding a safe haven in some corner of a Mayfair basement? Just asking.

Peter Wilby was editor of the Independent on Sunday from 1995 to 1996 and of the New Statesman from 1998 to 2005. He writes the weekly First Thoughts column for the NS.

This article first appeared in the 21 May 2015 issue of the New Statesman, The real opposition

Photo: Getty Images
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Cameron needs to decide what he thinks about Russia

David Cameron's words suggest one thing, his actions quite another.

David Cameron needs to decide whether he takes Russia seriously.

He certainly talks a good game, calling Vladimir Putin to account for crimes against Ukrainian sovereignty and for supporting the wrong side in Syria, claiming credit for bolstering the post-Crimea sanctions regime, and demanding that Moscow’s behaviour change. And the new Strategic Defence & Security Review, published last week, puts Russia front and centre among the threats Britain faces.

The problem is, his government’s foreign policy seems calculated to make no one happier than Putin himself.

At fault is not a failure of analysis. It has taken Whitehall 19 months since Moscow annexed Crimea to develop a new Russia policy, replacing the old aspirations of “strategic partnership based on common values”, but the conviction that Russia be treated as a significant threat to the U.K.’s security and prosperity is solid.

Five years ago, when the coalition government published the last Strategic Defence & Security Review, Russia was mentioned once, in the context of rising global powers with whom London could partner to help solve planetary problems, from nuclear proliferation to climate change. The new SDSR tells a very different story. Russia gets 28 mentions this time around, characterised as a “state threat” that “may feel tempted to act aggressively against NATO allies.” Russia’s annexation of Crimea and instigation of a separatist civil war in eastern Ukraine are mentioned in the same sentence with Assad’s chemical weapons attacks on Syrian civilians and the rise of the Islamic State as key examples of how the world is becoming a more dangerous place.

How that threat will be countered, however, is not a question Whitehall can answer: it is a question for Westminster, and it gets to the heart of where this government sees its place in the world, and in Europe in particular. What Whitehall cannot say – but what the politicians must recognise – is this: the best bulwark against the Kremlin is a strengthened European Union, with more integrated markets and the force to push a concerted foreign policy in the Eastern Neighbourhood. And that recognition requires Cameron to decide whether Putin poses a greater challenge than Nigel Farage.

The SDSR is right to note that the danger of a military confrontation with Russia is remote. Just in case, the Government has committed to bolstering aerial defences, contributing to NATO’s rapid reaction capabilities and maintaining the sanctions regime until a full settlement is reached that restores Ukrainian sovereignty. These are all reasonable measures, which will go some distance to ensuring that Moscow understands the risks of further escalation in the near term. But they do nothing to address the longer term problem.

From a hard-security perspective, Russia is a nuisance. The real danger is in the threat Moscow poses to what the SDSR calls the “rules-based order” – that system of institutions, agreements and understandings that underpin stability and prosperity on the European continent. That order is about more than respecting national borders, important as that is. It is also about accepting that markets are impartially regulated, that monopolies are disallowed and political and economic power reside in institutions, rather than in individuals. It is, in other words, about accepting rules that are almost the polar opposite of the system that Russia has built over the past 25 years, an order based on rents, clientelism and protected competitive positions.

Russia, after all, went to war over a trade treaty. It invaded Ukraine and annexed part of its territory to prevent the full implementation of a Deep and Comprehensive Free Trade Agreement that was designed to make Ukraine function more like Europe and less like Russia. From Moscow’s point of view, the European project is a very real geopolitical threat, one that promises to reduce the territory in which Russia can compete and, eventually, to increase the pressure on Russia itself to change. In somewhat less pernicious ways Moscow is seeking similarly to derail Moldova’s and Georgia’s European integration, while working hard to keep Belarus and Armenia from straying.

This is not a problem of vision or diplomacy, a failure to convince Putin of the value of the European way of doing things. For Putin and those on whose behalf he governs, the European way of doing things carries negative value. And unless the basic structure of politics and economics in Russia shifts, that calculation won’t change when Putin himself leaves the Kremlin. For the foreseeable future, Russia’s rulers will be willing to go to extraordinary lengths to prevent the widening of Europe, at the cost of instability and dysfunction in the region.

European willingness is another question. A chorus of euro=sceptics both left and right have demanded that Europe stop provoking the Russian bear, leaving the Eastern Neighbourhood countries to fend for themselves – sacrificing Kiev’s sovereignty to Moscow in order to bolster their own sovereignty from Brussels. Cracks, too, are emerging in the centre of the political spectrum: as French President Francois Hollande pledged to work with Moscow to fight ISIS in Syria, Prime Minister Manuel Valls declared that such an alliance would necessitate the lifting of sanctions on Russia, thus trading stability in Syria for instability in Ukraine.

As a member of the EU, London has a role to play. Together with Berlin, London could exert pressure on Paris and keep the margins of the political spectrum marginal. London could through its weight behind a common energy market, forcing Gazprom to play by EU competition rules. London could bolster anti-corruption systems and ensure that ill-gotten gains have no safe haven in Europe. London could insist on the legitimacy of the European project from one end of the continent to the other.

Instead, London is threatening Brexit, relinquishing any leverage over its European allies, and seeking EU reforms that would eviscerate the common energy market, common financial regulation, the common foreign and security policy and other key tools in the relationship with Russia.

In their February 2015 report on EU-Russian relations, the House of Lords raised the question of “whether Europe can be secure and prosperous if Russia continues to be governed as it is today.” To be sure, Europe can’t change Russia’s government and shouldn’t try. But by insisting on its own rules – both in how it governs its internal markets and in how it pursues its foreign policy – Europe can change the incentives Russia’s government faces.

The question, then, to Cameron is this: Whose rules would Westminster rather see prevail in the Eastern Neighbourhood, Europe’s or Russia’s?

Samuel A. Greene is Director of the King’s Russia Institute, King’s College London.