Leader: Prove to us that Labour is the alternative, Mr Miliband

Miliband must offer a vision of the kind of society and economy he would wish to create.

As Ed Miliband reflects on his first 100 days as Labour leader, he is likely to recall the dictum that being leader of the opposition is the most difficult job in British politics. Since coming from behind to win the leadership, he has struggled to maintain momentum. A largely hostile response from the media and the urgent demand for an alternative to the government's programme of spending cuts denied him the honeymoon usually granted to new leaders of the political parties.

The New Statesman endorsed Mr Miliband as the leadership candidate most prepared to challenge and break from the orthodoxies of the New Labour period and to reaffirm the party's commitment to creating a less unequal and divided society. But while the point of departure for Mr Miliband and his supporters is clear, the destination is not. He has yet to offer a clear path back to power or a new business model for social democracy. Unlike David Cameron, who became leader of the Conservative Party at a time of political and economic stability, the present leader of the opposition cannot afford to wait for the outcome of a two-year policy review before offering a coherent alternative to the government's plans. The public, which largely opposes the speed and scale of the coalition's cuts but knows little of Mr Miliband, deserves no less.

Labour is correct to reject the government's premature fiscal tightening and to call for a more even ratio between spending cuts and tax rises. But Mr Miliband needs to be more imaginative in his search for alternative sources of revenue. Instead of predictably calling for higher National Insurance and a permanent 50p income tax rate, he should explore ways of taxing unearned income and assets, including property and land, 69 per cent of which is owned by just 0.3 per cent of the population. He would do well to read carefully the speech that Vince Cable delivered at the Liberal Democrats' conference in Liverpool in September.

And yet there are reasons to be cheerful. Mr Miliband's performances at Prime Minister's Questions have been solid and have boosted morale among Labour MPs, many of whom, after all, did not vote for him. His use of the phrase "the squeezed middle" to describe those too poor to thrive in a market economy, but too rich to rely on state benefits, is resonant and is likely to increase Labour's electoral appeal in the coming months. As Gavin Kelly, chief executive of the Resolution Foundation, points out on page 24, a combination of rising prices, falling wages, higher taxes and lower benefits has imposed the biggest squeeze on living standards in Britain since the 1970s. Mr Miliband's opposition to the wrong-headed VAT increase is good politics and good economics. His approach reflects an awareness that the average British salary is just £26,000. Most people never shared in the spoils of the boom years.

Since he became leader, Labour has consistently led the Conservatives in the opinion polls for the first time since 2007 and has broken through the psychologically important barrier of 40 per cent. His own poor standing - a satisfaction rating of only +1 - is more likely a reflection of public indifference than a sign of outright hostility. The situation should improve as the Labour attack machine - enhanced by the appointment of the former political journalists Tom Baldwin as director of communications and Bob Roberts as head of press - begins to regain some of its old bite. In a shrewd move, Mr Miliband has begun to describe the government as "Tory-led" rather than a "coalition", thus ensuring that Labour concentrates its firepower on Mr Cameron and George Osborne, not Nick Clegg. Meanwhile, he has reached out to disaffected Lib Dems.

Labour, as the only large opposition and the only unambiguously centre-left party, is ideally placed to benefit from hostility to the cuts, but to prove his worth as a potential prime minister Mr Miliband must offer a vision of the kind of society and economy he would wish to create. For too long, he has allowed debate to be conducted on the coalition's terms. It is time to prove that there is a Labour alternative.

This article first appeared in the 10 January 2011 issue of the New Statesman, Here comes the squeeze