Miliband would be the Leader without Power on Spending

Ed-Miliband-today1

Labour’s pledges on spending have been tough to follow. You’d be forgiven if you got lost along the way. Looking back to 2010 the rhetoric was “too deep, too fast”, Miliband would attend Trade Union rallies and protest about how aggressive the cuts were and how the country would fall into a double-recession, high unemployment or whatever happened to be on the agenda at the time. Thankfully, none of those predictions came to fruition and so Labour’s criticism was forced to adapt.

Fast forward to today and the picture becomes comical. It’s hysterical to think that now after Labour’s fuss over the depth and commitment to austerity that they could possibly criticise the Chancellor, George Osborne for not eliminating the deficit in this Parliament. Labour’s rhetoric jumped from far-left to fiscal-right in a matter of years. If Osborne were to eliminate the deficit, a further £75bn in cuts would have been needed this term; that’s a figure which would see the Tory right sweat over, let alone Ed Miliband.

There aren’t many situations that you can criticise an opponent on two opposite measures: cutting too fast whilst not failing to flatten the books, but that’s where Labour precariously sit.

Ask a Labour speaker how they plan to eliminate the deficit themselves and you’ll be faced with an uphill battle. “We’d reintroduce the 50p tax on the highest earners” says Lucy Powell on the Daily Politics, despite the 45p top rate of tax collecting an extra £9bn more than the 50p ever did for the Treasury.

Labour’s savings pledges: 1.3% (£1bn) in total of the £75bn needed.

Unfortunately for Ed Miliband, Labour is at its strongest when the spotlight is on the Tories.

If Miliband was to win in May then he would be a leader without power, a political rag doll twisted and pulled from side to side as he is told to listen to party fringes. Over the last few weeks Labour has coughed up just a billion pounds in cuts out of the 75bn needed and regularly siphons off criticism by blaming the Tories for one thing or another. That’s politics, granted, but there is a clear reason why Labour has the hot sweats on spending.

Miliband is a child of the Trade Unions – he came to power through their backing, allowing him to triumph over his brother all those years ago. Moreover, the Unions are the largest donors to Labour and as such the party heavily relies on their support. We’ve seen the controversy over the relationship between Labour and the Unions with the vote rigging scandal in Falkirk, for example, but the Unions also greatly influence policy, and have been immensely vocal on their objections to austerity.

But that doesn’t even begin to illustrate Labour’s woes. By being vague thus far, Labour speakers are able to maintain unity amongst the party faithful going into the election. We know that there will be cuts under a Labour government – as well as more borrowing (£30bn) – but we just don’t know where or to what extent. Miliband’s politics relies on Labour’s left-wing grassroots support, to whom the promise of further austerity would be coldly rejected. On the other side, Miliband also has the general electorate to convince as well, people who think – rather astutely – that you can’t spend your way out of debt. And here is the chasm.

How do you appeal to two vastly different groups with the same message?

You take a leaf out of the SNP and the Scottish referendum by being as vague as is verbally possible. You don’t mention specifics, you talk broadly and focus on the big picture – when that fails you deflect damage and tear at the opposition.

But the cracks are already starting to appear in this giant vague structure. John McDonnell, a former Labour leadership challenger, announced that a bloc of 30-40 MPs would be out in force to ensure that Labour ends its commitment to austerity should the party win the election. The party North of the border is also throwing its hat in the ring. Should Labour need the support of the SNP on a case by case basis then austerity would be cut from manifestos.

This is all terrible news for Labour, who have been tip-toeing around this issue for months. Without a clear direction in economic policy you have to wonder how long the party can keep the financial markets stable and investment secure – perhaps even confidence in its own leader.

To give credit to Cameron over maintaining a troubled party would be an understatement. The Tories have rebelled on a plethora of issues over this term, seeing objections and defections over gay marriage, Europe, spending and more. Cameron has somehow managed to keep his ship sailing despite these difficulties. Will the same be said for Ed Miliband should he win? Can he keep a party like the SNP from disrupting his leadership as well as the Unions, his party left and grassroots from rebelling?

This tug-of-war over Labour party spending could be the biggest battle after the next election should Miliband get the keys to Number 10. The saddest part will be that all sides involved will be doing their best to move backwards.

3 COMMENTS

  1. It is not just the spending plans (or cuts) where Labour have a problem.

    They also claim that they will reduce the deficit by “increasing wages for hard working people” and so increasing the tax take and reducing the benefits bill…

    But if Labour do not follow thorough on the Conservative benefit cuts “to make work pay” what they are saying is that “hardworking people” will lose benefits and pay more tax as their income increases, making them no better off at all!

    How could they manage to increase wages for the lowest paid to such an extent that the tax take from them increases, and the benefits bill decreases – whilst they are better off too? The increases in wages would have to be so great that they would risk pricing many of those workers out of the employment market, so increasing the unemployed and consequently the benefits bill too!

  2. They’re not tough to follow at all! Here, this is how it goes:
    “We pledge to spunk £X billion up the wall on Y cause. It will be a paid for by a tax on bankers bonuses.”
    Repeat for infinite values of X and Y.

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