Support 110 years of independent journalism.

  1. Politics
22 January 2014

Even when they agree, Cameron and Miliband dress their vision for Britain in clashing colours

Everyone in Westminster knows that the nation’s creaking infrastructure needs an upgrade but Cameron’s “global race” and Miliband’s “new economy” must be depicted as ideological antitheses.

By Rafael Behr

There is a cathedral of clay, concrete and steel 30 metres beneath the East End of London. Tunnels ten metres high stretch into the distance, reverberating to the growl of heavy machinery. At one end a drilling machine, 150 metres long, gouges tonnes of earth every day. This is Crossrail, Europe’s biggest engineering project – a £14.8bn colonisation of the space beneath the capital for new east-west commuter rail lines.

Politicians love this half-built subterra­nean realm. David Cameron and Boris John­son recently came on a joint visit. George Osborne has been down here. Nick Clegg is planning a trip. The appeal is obvious. Here are jobs, apprenticeships, economic growth, progress. Better still, Crossrail is coming in on time and on budget.

Everyone in Westminster knows that the nation’s creaking infrastructure needs an upgrade but no one is sure how to pay for the job. British politics being what it is, Labour and the Conservatives have found ways to dress the same ambition in clashing ideological colours. For Cameron, it is all about the “global race” – equipping the UK to rival emerging economic powerhouses around the world.

This ambition is folded into a familiar Conservative prescription for a more competitive economy: lower corporate taxes, fewer workplace protections, emancipation from Brussels, benefit cuts as a device to promote self-reliance. Austerity is advertised as a means to make the state sleeker, not weaker. Slashing departmental budgets is supposed to leave capacity for investment in tunnels, roads and power stations, co-sponsored by private and foreign investors. (We can compete in a race with China if the Chinese build us enough running tracks first, apparently.)

Labour is much more comfortable with the idea of state intervention to foster growth, especially if it means bolstering sectors other than financial services and regions other than the south-east. It is axiomatic for Ed Miliband that politics is now all about enacting this economic “rebalancing”. This flows from his conviction that the financial crisis irrefutably discredited notions of state shrinkage as a route to collective prosperity. In the Labour leader’s view, the Tories are disciples of “old economy” dogma and so incapable of meeting what he sees as the defining challenge of the epoch – redesigning the economy so wealth and opportunity are more fairly distributed.

Select and enter your email address Your weekly guide to the best writing on ideas, politics, books and culture every Saturday - from the New Statesman. Sign up directly at The New Statesman's quick and essential guide to the news and politics of the day. Sign up directly at Stay up to date with NS events, subscription offers & updates. Weekly analysis of the shift to a new economy from the New Statesman's Spotlight on Policy team.
  • Administration / Office
  • Arts and Culture
  • Board Member
  • Business / Corporate Services
  • Client / Customer Services
  • Communications
  • Construction, Works, Engineering
  • Education, Curriculum and Teaching
  • Environment, Conservation and NRM
  • Facility / Grounds Management and Maintenance
  • Finance Management
  • Health - Medical and Nursing Management
  • HR, Training and Organisational Development
  • Information and Communications Technology
  • Information Services, Statistics, Records, Archives
  • Infrastructure Management - Transport, Utilities
  • Legal Officers and Practitioners
  • Librarians and Library Management
  • Management
  • Marketing
  • OH&S, Risk Management
  • Operations Management
  • Planning, Policy, Strategy
  • Printing, Design, Publishing, Web
  • Projects, Programs and Advisors
  • Property, Assets and Fleet Management
  • Public Relations and Media
  • Purchasing and Procurement
  • Quality Management
  • Science and Technical Research and Development
  • Security and Law Enforcement
  • Service Delivery
  • Sport and Recreation
  • Travel, Accommodation, Tourism
  • Wellbeing, Community / Social Services
Visit our privacy Policy for more information about our services, how New Statesman Media Group may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications.

In truth, the Tory leadership is not opposed to a spot of economic intervention if it serves political expediency. Osborne is inflating the housing market with his Help to Buy scheme. In the depths of stagnation, the Treasury discovered an affection for infrastructure spending. Danny Alexander went rummaging behind Whitehall sofas for loose change to boost pet projects.

Content from our partners
How to empower your employees to stay cyber secure
<strong>The energy sector reform the UK needs</strong>
Why we urgently need a social care workforce plan

With growth returning, the Chancellor doesn’t want that side of the story to complicate his message of steely fiscal discipline. The primary concern is establishing a distinction between the Tories, who have the guts to keep cutting until the deficit is slain, and Labour, which can’t wait to get splurging again. This permits no discussion of borrowing for investment.

That is an option Labour wants to keep open, but Miliband knows that debt has been rendered politically toxic by the Tories. One shadow cabinet minister reports that his constituents view public borrowing about as enthusiastically as a policy of “slaying every first-born child”. This is a problem for Miliband. His instincts are to promise a government that does more; the election campaign will bring demands to prove that Labour knows how to do less. The rhetoric of national renewal doesn’t travel so far when delivered into a tight fiscal corner.

One idea for escaping this trap, under active consideration in Labour policy circles, is to pledge devolution of revenue-raising powers away from Whitehall. Regions and cities could have more say over local property and business taxes, with a view to investing the proceeds in local housing and infrastructure. Crossrail offers a precedent. Around a fifth of the cost has been met by a dedicated “business rate supplement” paid by the capital’s enterprises.

Labour enthusiasts for this approach point out that it also featured in Lord Heseltine’s 2012 review for Downing Street on “strat­egies for growth”. In keeping with White­hall tradition, Heseltine’s recommendations were welcomed by No 10 and diluted by the Treasury. Osborne found £2bn per year, a fraction of the sums Heseltine had in mind, for a Single Local Growth Fund, from which local enterprise partnerships (LEPs) will bid for handouts. LEPs were formed by the coalition to replace regional development agencies, which had been identified in 2010 as pointless Labour quangos and scrapped.

It isn’t the first time a government has dismantled the work of its predecessor and then re-mantled it, having worked out what it was for. The need to overcome this cyclical volatility was one of the priorities identified by Sir John Armitt, the former chairman of the Olympic Delivery Authority, in a report commissioned by Labour last year. He recommended the creation of a cross-party National Infrastructure Commission to develop priorities for investment without partisan point-scoring. The idea was lost in bickering over who was more responsible for the failure to think long-term. The irony went unremarked.

The Prime Minister and the leader of the opposition both want to present themselves as the sole proprietor of a vision to equip the country for the challenges of the future. Each will accuse the other of being trapped in the past. For general election purposes, Cameron’s “global race” and Miliband’s “new economy” must be depicted as ideological antitheses, precluding any constructive discussion of what the challenges are and how the investment that everyone agrees we need can be afforded. Short-term political tribalism, it seems, is indispensable in order to form a government committed to the long-term national interest. And irony is one industry where Britain has always been a global leader.