“We’ll win when we become New Labour”

The reforming Tories around David Cameron and George Osborne are determined to pick up where Tony Bl

If the party chatter at Labour conference was all politics - would Gordon survive or would Miliband the Elder step aside for the much-favoured Miliband the Younger? - the Tories are in full wonk mode. "What should we do about the Educational Maintenance Allowance?" is the kind of question they'll be asking over the canapés in Manchester. Or: "How will the pupil premium work?"

Economic policy is at the fore, and it is frankly the area in which the Conservatives have the most work to do. But public service reform runs a close second. The reforming Tories clustered around David Cameron and George Osborne are determined to pick up where Tony Blair left off. Many of these bright young things are undisguised admirers of Blair, but they think he was too slow in seeing that real reform in the public sector means giving power away, rather than setting targets from the centre. The reason Blair had "scars on his back" from trying to reshape the public services is that he fell into the trap of attempting to run schools and hospitals from his sofa in Downing Street. So his first parliamentary term was wasted.

Heirs to Blair

The new Conservative/old Blairite mission is to use consumer choice to produce better, fairer public services. The idea is to create what the New Labour academic Julian Le Grand has called "quasi-markets" - but then rig these markets in favour of the poor. Labour made a start in both health and education, with foundation hospitals and academy schools. But then Blair ran out of road. Michael Gove, the shadow education secretary, wants to give choice to parents over which school to send their children to, with money following the pupil wherever he or she goes. But crucially, he also plans to weight the choice in favour of the least advantaged by giving them a "pupil premium". Parents will also be able to use the money to set up their own schools, although few are expected to do so. The National Curriculum will be slimmed down. Head teachers will get much more power over pay and rations.

Tory education policy is an example of undiluted Blairism. It chimes perfectly with Cameron's calls for a "radical redistribution of power" and with the call in Leading from the Front, a new pamphlet from Demos, for more discretion and power to be given to front-line public servants. Conservative plans to give local councils greater authority are another part of the drive for more diversity, competition and accountability.

Three years ago, one of Cameron's inner circle said to me: "We'll win when we become New Labour, and Labour ceases to be New Labour." On education, both demands have been met. Labour still talks the language of reform here, but is back to tinkering from the centre. On these pages, the Schools Secretary, Ed Balls, has said he doesn't need think tanks to work out that there is a "false choice between heavy-handed statism which does not respect individual choices and a so-called progressive liberalism that sees the state as the enemy of individual freedom". But this is the minister who made cooking classes mandatory in every school, and even gave his own recipe suggestions (shepherd's pie and apple crumble); the minister who, in July, made home-school agreements compulsory; the minister who wants state checks on parents giving the neighbours' kids a lift to Scout meetings.

The Tories have ring-fenced spending on the National Health Service - instead of education, which would make more sense - and have opposed many Labour reforms aimed at giving more power to patients. They appear willing to give up some of Labour's hard-won ground to GPs on out-
of-hours working.

Luddite on health

The politics of this are obvious. As part of the detoxification of the Tory brand, it was vital to be seen as a friend of the NHS. Tory high command knows the media would love to run "Tories to privatise health service" stories. The Tories know, too, that they will have to fight the teachers' unions to get their education reforms through, and have calculated that they can't afford to fight the health unions at the same time. They don't want a war on two fronts.

But they are now in danger of losing some political credibility. While Lansley blows kisses at the doctors, the Health Secretary, Andy Burnham, is pushing ahead with reform. As well as giving patients the right to choose their own GP, he is driving individual budgets for social care and shifting resources into preventative health.

It is a reflection of the weird, refractive nature of current politics that the Conservatives are Blairite on education and Luddite on health, while Labour is regressing on schools reform but still heroically wrestling with the NHS.

When the Tories win next year, they will need a true moderniser in health care: someone with impeccable reformist credentials, a reputation for strong departmental management and a willingness to fight the trade unions. How about Peter Mandelson?

Richard Reeves is director of Demos

This article first appeared in the 05 October 2009 issue of the New Statesman, The tories/the people

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Paul Mason: How the left should respond to Brexit

It's up to the labour movement to rescue the elite from the self-inflected wound of Brexit.

For the first time in a generation there is a tangible split between the Tory leadership and the business elite. Forget the 41 per cent poll rating, forget Theresa May’s claim to have moved towards “the centre”; the most important thing to emerge since the Tory conference is a deep revulsion, among wide sections of normally Conservative voters, at the xenophobia, nationalism and economic recklessness on display.

Rhetorically, May has achieved a lot. She quashed any possibility of a soft Brexit strategy. She ended 30 years of openness to migration. She scrapped the Tories’ commitment to balanced books by 2020 – though she neglected to replace this keystone policy with anything else. And she pledged to stop constitutional scrutiny over the Brexit process from Holyrood, Westminster or the courts.

Yet in reality she achieved nothing. May’s government is not in control of the crucial process that will define its fate – the Brexit negotiations. And on Scotland, she has triggered a sequence of events that could lead to the end of the UK within the next five years.

In the light of this, the left has to be refocused around the facts that have emerged since the referendum on 23 June. Britain will leave the EU – but it faces a choice between May’s hubristic nonsense and a strategy to salvage 30 years of engagement with the biggest market in the world. Scotland will hold its second referendum. Labour will be led through all this by a man who, for the first time in the party’s history, cannot be relied on to do the elite’s bidding.

Brexit, on its own, need not have caused a great shift in British politics. It is the new, visceral split between Tory xenophobia and the implicitly liberal and globalist culture in most boardrooms that makes this a turning point. It is a challenge for the left as big as the ones Labour faced in 1931, when the gold standard collapsed; or in 1940, when the reality of total war dawned. It represents a big opportunity – but only if we jolt our brains out of the old patterns, think beyond party allegiances, and react fast.

Let’s start with the facts around which May, Philip Hammond and Amber Rudd constructed their rhetorical body swerve at the Tory conference. Britain is £1.7trn in debt. Its budget deficit cannot be eradicated by 2020 because, even on the steroids of quantitative easing, growth is low, wages are stagnant and its trade situation deeply negative. Austerity, in short, did not work.

With sterling weakened, by next year we’ll begin to feel the pressure of imported inflation on real wages, re-creating the economic pain of 2011-12. On top of that, by attempting a “hard Brexit”, May has created damaging uncertainty for investment that no degree of short-term positivity can mitigate. Even if the range of outcomes only widens, investment will get delayed – and with May’s commitment to hard Brexit the range of outcomes will get significantly worse: 7.5 per cent lopped off GDP, according to a leaked Treasury assessment.

Civil servants believe Britain’s negotiating position is so weak that it will have to leverage its intelligence-providing services to Europe and concede “free movement of high-skilled workers”, just to persuade the French and the Germans to cut any kind of decent bilateral deal. Yet in the two years of brinkmanship that begin when Article 50 is triggered, the EU27 will have no reason whatsoever to concede favourable terms for bilateral trade. By adopting hard Brexit and hard xenophobia, Theresa May has scheduled a 24-month slow-motion car crash.

To orient the Labour Party, trade unions and the wider progressive movement, we need first to understand the scale of the break from normality. Labour already faced deep problems. First, without Scotland it cannot govern; yet many of its members in Scotland are so dislocated from the progressive Scottish national movement that the party is bereft of answers.

Next, the old relationship between the urban salariat and the ex-industrial working class has inverted. With a vastly expanded membership, Labour is the de facto party of the urban salariat. Its heartland is Remainia – the cities that voted to stay in Europe. Its electoral battlegrounds are now places such as Bury, Nuneaton, Corby and Portsmouth, where the “centre” (as measured by the Lib Dem vote) has collapsed, to be replaced by thousands of Green voters and thousands more voting Ukip.

This was the known problem on the eve of Brexit, though layers of Labour MPs and councillors refused to understand it or respond to it. The solution to it was, even at that point, obvious: Labour can only attract back a million Green voters and hundreds of thousands of Ukip voters in winnable marginals with a combination of social liberalism and economic radicalism.

The alternative, as outlined in the Blue Labour project of Maurice Glasman and Jon Cruddas, was an overt return to social conservatism. That cannot work, because it might win back some ex-Labour Ukip voters but could not inspire Labour’s new urban core to go on the doorstep and fight for it. On the contrary, it could easily inspire many of them to tear up their membership cards.

A new strategy – to combine social liberalism, multiculturalism and environmentalism with left-wing economic policies aimed at reviving the “communities left behind” – was, for me, always the heart of Corbynism. Jeremy Corbyn himself, whatever his personal strengths and weaknesses, was a placeholder for a political strategy.

Brexit, the attempted Labour coup and the Tory swing to hard Brexit have changed things all over again. And Labour’s leadership needs to move fast into the political space that has opened up. The starting point is to understand May’s administration as a regime of crisis. It is held together by rhetoric and a vacuum of press scrutiny, exacerbated by Labour’s civil war and the SNP’s perennial dithering over strategy to achieve Scottish independence. The crisis consists of the perils of hard Brexit combined with a tangible split between the old party of capital and capital itself. The elite – the bankers, senior managers, the super-rich and the ­upper middle class – do not want Brexit. Nor does a significant proportion of Middle Britain’s managerial and investing classes.




All this presents Labour with a series of achievable goals – as an opposition in Westminster, in London, as the likely winner in many of the forthcoming mayoral battles, and at Holyrood. The first aim should be: not just oppose hard Brexit, but prevent it. This entails the Labour front bench committing to an attempt to remain inside the European Economic Area.

The wariness – shared by some on the Corbyn side, as well as the Labour right – is born of the assumption that if you commit to the single market, you must accept free movement of labour. The party’s new spokesman on Brexit, Keir Starmer, expressed perfectly what is wrong with this approach: first it’s a negotiation, not a finished relationship; second, you start from the economics, not the migration issue.

Leaving the single market will be a macroeconomic disaster, compounded by a social catastrophe, in which all the European protections – of citizens’ rights, labour rights, consumer and environmental standards – will get ripped up. That’s why the Labour front bench must commit to staying inside the single market, while seeking a deal on free movement that gives Britain time and space to restructure its labour market.

John McDonnell’s “red lines”, produced hurriedly in the days after Brexit, embody this principle – but not explicitly. McDonnell has said Labour would vote against any Brexit deal that did not involve some form of single-market access, and preserve the City’s passporting arrangement, where banks are authorised to trade across an entire area without having to be incorporated separately in each country. Freedom of movement is not included in the red lines.

May, meanwhile, insists there will be no parliamentary scrutiny of the negotiating stance, or of the outcome. This position cannot stand, and overthrowing it provides a big, early target for Labour and the other opposition parties. They should use their constitutional influence – not only in Westminster but at Holyrood, Cardiff and the mayor-run cities, to bust open the Conservatives’ secrecy operation.

By declaring – formally, in a written pact – that they will refuse to ratify a Brexit deal based on World Trade Organisation tariffs, the progressive parties can destroy May’s negotiating position in Brussels overnight. Let the Conservative press accuse us of being “citizens of the world”, undermining the national interest. They will dig their own political grave even faster.

In parallel, Labour needs to lead – intellectually, morally and practically – the fight for a coherent, pro-globalist form of Brexit. In order for this to embody the spirit of the referendum, it would have to include some repatriation of sovereignty, as well as a significant, temporary retreat from freedom of movement. That means – and my colleagues on the left need to accept this – that the British people, in effect, will have changed Labour’s position on immigration from below, by plebiscite.

In response, Labour needs to design a proposal that permits and encourages high beneficial migration, discourages and mitigates the impact of low-wage migration and – forgotten in the rush to “tinder box” rhetoric by the Blairites – puts refugees at the front of the queue, not the back. At its heart must be the assurance, already given to three million EU-born workers, that they will not be used as any kind of bargaining chip and their position here is inviolable.

Finally Labour needs to get real about Scotland. The recent loss of the council by-election in Garscadden, with a 20 per cent swing to the SNP, signals that the party risks losing Glasgow City Council next year.

It is a problem beyond Corbyn’s control: his key supporters inside Scottish Labour are long-standing and principled left-wing opponents of nationalism. Which would be fine if tens of thousands of left-wing social democrats were not enthused by a new, radical cultural narrative of national identity. Corbyn’s natural allies – the thousands of leftists who took part in the Radical Independence Campaign – are trapped outside the party, sitting inside the Scottish Greens, Rise or the left of the SNP.

The interim solution is for Scottish Labour to adopt the position argued by its deputy leader, Alex Rowley: embrace “home rule” – a rejigged devo-max proposal – and support a second independence referendum. Then throw open the doors to radical left-wing supporters of independence. If, for that to happen, there has to be a change of leadership (replacing Kezia Dugdale), then it’s better to do it before losing your last bastion in local government.

The speed with which Labour’s challenge has evolved is a signal that this is no ordinary situation. To understand how dangerous it would be to cling to the old logic, you have only to extrapolate the current polls into an electoral ground war plan. Sticking to the old rules, Labour HQ should – right now – be planning a defensive campaign to avoid losing 60 seats to May. Instead, it can and must lay a plan to promote her administration’s chaotic demise. It should have the ambition to govern – either on its own, or with the support of the SNP at Westminster.

To achieve this, it must confront the ultimate demon: Labour must show willing to make an alliance with the globalist section of the elite. Tony Blair’s equivocation about a return to politics, the constant noise about a new centrist party, and signs of a Lib Dem revival in local by-elections are all straws in the wind. If significant sections of the middle class decide they cannot live with Tory xenophobia, the liberal centre will revive.

The best thing for Labour to do now is to claim as much of the high ground before that. It must become the party of progressive Brexit. The worst thing would be to start worrying about “losing the traditional working class”.

The “traditional working class” knows all too well how virulent Ukip xenophobia is: Labour and trade union members spend hours at the pub and in the workplace and on the doorstep arguing against it.

All over Britain, the labour movement is a line, drawn through working-class communities, which says that migrants are not to blame for poor housing, education, low pay and dislocated communities. For the first time in a generation Labour has a leader prepared to say who is to blame: the neoliberal elite and their addiction to privatisation, austerity and low wages.

It was the elite’s insouciance over the negative impacts of EU migration on the lowest-skilled, together with their determination to suppress class politics inside Labour, that helped get us into this mess. An alliance with some of them, to achieve soft Brexit, democratic scrutiny and to defeat xenophobic solutions, must be conditional.

We, the labour movement, will dig the British ruling class out of a self-made hole, just as we did in May 1940. The price is: no return to the philosophy of poverty and inequality; a strategic new deal, one that puts state ownership, redistribution and social justice at the heart of post-Brexit consensus.

That is the way forward. If Labour politicians can bring themselves to explain it clearly, cajole the party apparatus out of its epic sulk and make a brave new offer to Scotland – it can work. But time is important. We are up against a corrosive nationalist bigotry that now echoes direct from the front page of the Daily Mail to Downing Street. Every day it goes unchallenged it will seep deeper into Britain’s political pores.

Paul Mason is the author of “PostCapitalism: a Guide to Our Future” (Penguin)

This article first appeared in the 13 October 2016 issue of the New Statesman, England’s revenge