Leader: It is not “socialism” to say we are facing market failure on a grand scale

By refusing to accept that the market is not working for the majority, the Tories have put themselves at odds with the public.

For decades after the Thatcher revolution of the 1980s, politicians of the left and the right put their faith in a new economic paradigm as the guarantee of prosperity for the majority. Today, after the “Great Contraction” of 2008-2009, they can no longer do so with the same confidence. Economic growth in Britain has returned after three years of stagnation but it is forecast that real wages will not increase until 2015 and will not return to their pre-crash levels until 2023. A broken energy market, in which six companies control 98 per cent of supply, has left 4.5 million people in fuel poverty. Extortionate rents have forced millions to rely on housing benefit. By any measure, this is market failure on a grand scale.

The living standards crisis is a challenge for all political parties but most of all for the Conservatives, the natural defenders of capitalism. After Labour pledged to freeze gas and electricity prices until 2017 and to build 200,000 homes a year by 2020, David Cameron’s party had a chance to offer its own intelligent and imaginative solutions. But at its conference in Manchester, it retreated to its comfort zone. Aided by an ever more partisan right-wing press, speaker after speaker derided Mr Miliband as a “socialist” and a “Marxist”, as if concern at falling wages were comparable to a belief in world revolution.

In doing so, they failed to recognise that when Margaret Thatcher assailed her left-wing opponents in the 1980s, she did so in the confidence that her free-market policies retained popular support. Mr Cameron does not enjoy that luxury. Polls show that roughly two-thirds of voters support a 50p top income-tax rate, a mansion tax, stronger workers’ rights, a living wage and the renationalisation of the railways and the privatised utilities. If Mr Miliband is a socialist, so is much of the public.

The most unintentionally revealing moment of the conference came when George Osborne rebuked the Labour leader for suggesting that “the cost of living was somehow detached from the performance of the economy”. It was a remark that betrayed Mr Osborne’s failure to appreciate that the crisis is not merely cyclical (a problem exacerbated by his strategy of austerity), but structural. It was in 2003, long before the crash, that wages for 11 million earners began to stagnate.

Aside from a pledge to freeze fuel duty until 2015, the Tories had nothing significant to say in Manchester on the question of living standards. The most important announcements were the early introduction of the Help to Buy scheme and Mr Osborne’s commitment to achieve a Budget surplus by the end of the next parliament, both of which risk further depressing incomes. By inflating demand without addressing the fundamental problem of supply, Help to Buy will make housing less affordable, while Mr Osborne’s promise of a balanced Budget is likely to be met by imposing even greater cuts to benefits and services for the poorest. The Chancellor’s ideological fixation with the public finances ignores the greater crisis in voters’ finances.

On the fringes of the party, there is much good thinking. The Conservative campaign group Renewal, which aims to broaden the party’s appeal among northern, working-class and ethnic-minority voters, published a pledge card calling for the building of a million new homes over the course of the next parliament, a significant increase in the minimum wage, a “cost of living test” for all legislation and action against “rip-off companies”. However, there is as yet little sign that the Conservative leadership is prepared to embrace the kind of reformist, centrist agenda that secured Angela Merkel’s re-election in Germany.

The Tories’ error – compounded by the Prime Minister in his conference speech on Wednesday 2 October –has been to mistake the views of the strident right-wing press for those of the majority of the British public and to dismiss sensible calls for a more responsible capitalism as unreconstructed socialism.

George Osborne and Michael Gove listen to speeches at the Conservative conference in Manchester. Photograph: Getty Images.

This article first appeared in the 07 October 2013 issue of the New Statesman, The last days of Nelson Mandela

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What is the Scottish Six and why are people getting so upset about it?

The BBC is launching a new Scottish-produced TV channel. And it's already causing a stooshie. 

At first glance, it should be brilliant news. The BBC’s director general Tony Hall has unveiled a new TV channel for Scotland, due to start broadcasting in 2018. 

It will be called BBC Scotland (a label that already exists, confusingly), and means the creation of 80 new journalism jobs – a boon at a time when the traditional news industry is floundering. While the details are yet to be finalised, it means that a Scottish watcher will be able to turn on the TV at 7pm and flick to a Scottish-produced channel. Crucially, it will have a flagship news programme at 9pm.

The BBC is pumping £19m into the channel and digital developments, as well as another £1.2m for BBC Alba (Scotland’s Gaelic language channel). What’s not to like? 

One thing in particular, according to the Scottish National Party. The announcement of a 9pm news show effectively kills the idea of replacing News at Six. 

Leading the charge for “a Scottish Six” is John Nicolson, the party’s Westminster spokesman for culture, media and sport. A former BBC presenter himself, Nicolson has tried to frame the debate as a practical one. 

“Look at the running order this week,” he told the Today programme:

“You’ll see that the BBC network six o’clock news repeatedly runs leading on an English transport story, an English health story, an English education story. 

“That’s right and proper because of the majority of audience in the UK are English, so absolutely reasonable that English people should want to see and hear English news, but equally reasonable that Scottish people should not want to listen to English news.”

The SNP’s opponents think they spy fake nationalist outrage. The Scottish Conservatives shadow culture secretary Jackson Carlaw declared: “Only they, with their inherent and serial grievance agenda, could find fault with this.” 

The critics have a point. The BBC has become a favourite punch bag for cybernats. It has been accused of everything from doctored editing during the independence referendum to shrinking Scotland on the weather map

Meanwhile, the SNP’s claim to want more coverage of Scottish policies seems rather hollow at a time when at least one journalist claims the party is trying to silence him

As for the BBC, it says the main reason for not scrapping News at Six is simply that it is popular in Scotland already. 

But if the SNP is playing it up, there is no doubt that TV schedules can be annoying north of the border. When I was a kid, at a time when #indyref was only a twinkle in Alex Salmond’s eye, one of my main grievances was that children’s TV was all scheduled to match the English holidays. I’ve migrated to London and BBC iPlayer, but I do feel truly sorry for anyone in Glasgow who has lost half an hour to hearing about Southern Railways. 

Then there's the fact that the Scottish government could do with more scrutiny. 

“I’m at odds with most Labour folk on this, as I’ve long been a strong supporter of a Scottish Six,” Duncan Hothershall, who edits the Scottish website Labour Hame. “I think the lack of a Scotland-centred but internationally focused news programme is one of the factors that has allowed SNP ministers to avoid responsibility for failures.”

Still, he’s not about to complain if that scrutiny happens at nine o’clock instead: “I think the news this morning of a new evening channel with a one hour news programme exactly as the Scottish Six was envisaged is enormously good news.”

Let the reporting begin. 

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.