Last month, John Denham, Labour MP and one of Ed Miliband’s intellectual outriders, wrote an interesting comment piece for newstatesman.com in which he sought to bury the idea that his leader must choose between “radicalism” and “pragmatism”. It was a false thesis; politics is nothing if not a series of daily trade-offs between idealism and expediency.
Hidden within Denham’s valiant attempt to cast Miliband as Labour’s man for all seasons was a passage that jumped out. In fact, it didn’t so much jump as rise from the screen, hoist its skirts and start dancing a cancan. “There are some in Labour who assume that progressive change is measured by the level of public spending. But the emerging consensus among those Ed has promoted is that there is no foreseeable point where the public spending taps are turned back on.”
What was this, Ed Miliband embracing fiscal conservatism?
It’s easy to forget now, but even as recently as the start of this year there was a lively debate under way within Labour ranks about how to address the harsh new economic realities. In January, Ed Balls announced that “we must accept all the [coalition] cuts”, but that turned out to be a messy holding position rather than a statement of intent. And after the furious reaction of Len McCluskey, general secretary of the Unite union, the position was quickly shelved.
Yet, at the time, there was still a much broader – and deeper – discussion about how the progressive left could still make itself relevant in an era when big cheques could no longer be written and the old social-democratic model was increasingly unaffordable. Even Ed Miliband was nominated as the Taxpayers’ Alliance “pin-up of the month” after he conceded, in a speech to London Citizens at the Oxo Tower, “Whoever is the next prime minister will still have a deficit to reduce, and will not have money to spend.”
Since then, as Labour’s poll lead has widened, that debate has been deemed surplus to requirements. “Things were rocky,” a union insider said to me this past week, referring to the January fisticuffs, “but it’s smoother sailing now. We’re back on the same page.”
Within the shadow cabinet, the debate about spending restraint has been not so much suspended, but terminated. “We’ve given up on coming up with our own agenda [on spending cuts],” a shadow cabinet insider told me. “Now we’re happy just opposing effectively.”
I’ve been told that Miliband will never again claim a future Labour government will “not have money to spend”. Nor will any future Balls interview contain the phrase “we are going to have to keep all the Tory cuts”. If Miliband and his lieutenants have become convinced of the need for fiscal probity in deed as well as word, they’re going to be keeping it to themselves.
This goes beyond tactical nuancing. What two years ago stood as the central plank of Labour’s ideological and political renewal has now been reduced to so much firewood.
One need only turn to the Fabians’ recent publication The Shape of Things to Come. The foreword, written by the ubiquitous John Denham, talks of how “a more dynamic, competitive and fairer economy can reduce the public costs of failing markets and help deliver public spending discipline”.
He then recycles the usual progressive staples; the need for more regulation, more funding in training and research, more state-backed finance. Nowhere does it identify where public-spending discipline will actually require cuts and smaller government.
To survey the craggy peaks of the left’s intellectual hinterland is to search in vain for evidence of econo-pragmatism. Compass, led by Neal Lawson, has produced its report Plan B: a Good Economy for a Good Society. It includes chapters on emergency growth measures, a fairer tax and benefits system and reform of the City and banks (of course). But the final chapter, “A New State that Spends Better”, deploys the word “cut” only in an attack on those fiendish “neoliberals”.
The new union-sponsored think tank Class predictably promotes “active government” and “growth not austerity”. IPPR opts to split the difference, claiming in its latest pamphlet that Hayek and Keynes were each “ahead of his time”. Demos appears to have given up on economic analysis altogether, preferring to lead on burning issues such as east London’s digital economy.
The hunt for Labour relevance amid the scarred new socio-economic landscape is over. The search parties have been called off. Where once the talk was of “difficult choices that all of us wish we did not have to make”, we are now being told that “the tide is turning” on the politics of austerity.
It isn’t – as the French president, François Hollande, is already finding to his cost. But who needs to be talking tough on public finances and government spending when you’re 10 points ahead in a YouGov poll?
Jon Cruddas, the MP who is in charge of Labour’s policy review, has started to sketch out a narrative in his bold primary political colours but the matt black of fiscal restraint will not feature. Balls is telling friends that George Osborne’s failure to meet his deficit-reduction targets has drastically narrowed Labour’s room for manoeuvre and there are whispers of some new “golden fiscal rules”. But the plan has not developed beyond promises of a short-term adrenalin shot for the stuttering economy.
As for Ed Miliband, he is operating with the safety catch on. Difficult decisions – the really difficult decisions – will be saved for after the election. The calculation among his inner circle is that the party won’t stomach them, the public doesn’t want to face them and Tory infighting will allow Labour to keep on ducking them. The settled view seems to be that the next election will be fought between the nation-builders and the nation-wreckers.
As the party conference season approaches, Labour’s leader feels emboldened. He believes he has been proved right on the big calls. His hands are now shaping the political agenda; the tide is running his way. Tough choices? Leave those to the other guy.