Labour: An Economic Watershed

Recent speeches by the two Eds, Milliband and Balls are exposing Labour to a potential electoral crisis. It is not too late to correct what appears to be going wrong, but it is getting late nevertheless.

The 2015 General Election will be won or lost in 2013. Three years into a fixed five year parliament voters will either feel that the Government is moving slowly in the right direction and should be allowed to finish the job, or that it cannot get to grips with the issues effectively and should be kicked out. Voters will also form an opinion about the Opposition. Either it looks as if it could govern better, or it cannot be trusted to deliver.

One of the problems for Labour has been that the impact of a fixed term parliament, the UK’s first, is greater upon the Opposition than the Government. The nature of our adversarial system is that those who rule must be harried by those who would like to; the latter driven forward by the motivation that they can force the government into an election at a point of disadvantage to it. The tension thus generated between the two sides is thought to be an essential feature of the British system, or was until 2010. Without it, the Opposition is a good deal less important and its function a good deal less well defined.

It is now becoming clear that the Tory led Coalition is not achieving the pace of economic recovery it promised. There are some positive signs, but while they show some progress here and there, they do not add up to a surge on all economic fronts. Up till now it has been enough for Labour just to point this out. But now people are losing faith in the Coalition’s ability to solve the financial difficulties comprehensively, so they are turning to look at Labour to ask how, exactly, it plans to deliver a better outcome. The response has been far short of the expectation. The Labour lead in the polls has slipped to single figures.

What Labour has offered is a weird mixture of trivia and confusion which appears to show little worth voting for and a lot to question.  One Ed says he will stop winter fuel payments to the rich, while the other Ed says he will cap welfare benefits for the poor. Coming on top of wisdoms like reducing rents ‘by giving local councils powers to negotiate’ and reducing vat without any, even temporary increase in borrowing, and even their own supporters are beginning to fear that there may be some truth in the widely held suspicion that when it comes to the economy these two Eds haven’t a clue.

Moreover there appears to be a weakness in the foundation upon which their thinking stands. Labour had a default position as the party which invented the welfare state and the national health service, based on the principle of universal entitlement, funded by a taxation regime in which the rich paid a good deal more both in rates and volume, and were thus equally entitled to the benefits. We are now hearing stuff about bigger welfare payouts for bigger contributors and rumours that child benefit will continue to be denied higher rate taxpayers if Labour gets back to power.

This all may be part of some radical plan which hangs together when viewed from the perspective of the left, but to this core constituency the fragments now on offer to them from their Labour party are quite alarming, and to those floating voters whose support Labour must win in order to govern, very unappealing. This may explain a peculiar leak from Labour to UKIP. Perhaps some disillusioned supporters feel that instead of stepping forward into murky confusion, it might be better to chance a leap in the dark.

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