Stumbling and Mumbling

Labour: office vs opposition

chris dillow
Publish date: Wed, 21 Feb 2024, 10:10 AM
chris dillow
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An extremist, not a fanatic

"Men make their own history, but they do not make it as they please." Marx's words should give a little encouragement to those leftists despairing of whether a Labour government could do any good.

Of course, there are reasons for despair. The abandoning of the promise to invest £28bn a year in greening the economy suggests, says Grace Blakeley, that "if current policies are maintained in office, we will see basically no changes in macroeconomic policy under a Labour government."

Which is a big problem, because we need different macroeconomic policy if not to restart growth (something best done by supply-side reforms given that we're near full employment) then at least to repair our broken public services.

And history offers us a bleak warning: there are few examples of a government being more leftist in office than in opposition. Hence Grace's words:

The relentless shift towards the right we're seeing within the Labour Party in opposition will not slow when the Party goes into government. If anything, it will speed up.

Nevertheless, I - very warily - disagree with such pessimism. I suspect there are pressures which will force Labour to be more radical in office than it is promising to be.

One is that the Westminster environment will be very different next year if - as is possible - the Tories are reduced to a few dozen seats. Hundreds of new Labour backbenchers will not want to go to their constituencies and tell people the government is doing nothing to stop their school falling down or to help them see a doctor. They'll be yapping at ministers to do something. And at least some will have the wit to point out that the annihilation of the Tories was not just a rejection of corruption and incompetence but also as a rejection of the ideology that has given us economic stagnation and wrecked public services.

What's more, if the post-1997 precedent is any guide, the rump of the Tory party will turn inwards and focus on its pet obsessions. Gibber about wokery, cultural Marxism and the left's capture of our institutions will only remind Starmer that the Tories are simply irrelevant.

In this context there'll be no excuse for the BBC to continue to invite the Tory party's outriders onto its shows. The IEA-Telegraph-Spectator crew will be seen for what it is - a handful of cranks cosplaying at a deluded image of Thatcherism and representative only of anonymous billionaires.

The voices around Westminster will therefore be very different from what they now are. Which means the influences on Starmer will change.

Such voices will, though, merely remind him of the truth outside Westminster - that changing policy isn't some leftist pipedream but a brute necessity. As John Harris says:

Even if Labour's belief that it can only win by staying quiet is correct, arriving in government - and remaining there - will surely demand something very different.

The demand is not merely that we must get NHS waiting lists down; save councils from bankruptcy; repair schools; fix the railways; restore the criminal justice system to some sort of functionality; and get the economy growing. Even if Starmer didn't care about any of this, he would still need to do something.

This is because failing to address these problems would foster hostility to the political system and political class. Five more years of economic stagnation and declining public services will lead people to believe that neither political party can do anything for them.

And the backlash this creates won't be an intelligent one. Back in 2006 Ben Friedman showed that economic stagnation led to illiberalism and a revolt against democracy. Subsequent events have vindicated him. Markus Brueckner and Hans Peter Gruener have described how "lower growth rates are associated with a significant increase in right-wing extremism". And Ana Sofia Pessoa and colleagures have shown that "austerity-driven recessions amplify the political costs of economic downturns considerably by increasing distrust in the political environment."

Even if Starmer wanted to do no more than preserve the legitimacy of the existing political system (and capitalism) and prevent the rise of the far-right, he would therefore need to rescue the economy and public services.

There's something else, hinted at in Starmer's recent speech to the Scottish Labour conference:

I grew up working class in the 1970s. And while I don't plead poverty, I know what a cost of living crisis feels like. I know what it feels like, to be embarrassed to invite your friends round, because the carpet's threadbare. There's a hole in the window. The phone's been cut off. Because your family can't keep up with their payments. The cloud of anxiety that hangs over a house. The "what next" fear of the postman coming down the path. Will he bring another bill we can't afford? I remember that....How can you talk about changing inequality, or racism, or any other structural injustice in this country, without an account of class.

No recent Tory PM could have said this. And it matters. Starmer's (and Reeves') upbringing has instilled in him a sympathy (to use Smith's word) towards working class people to a greater degree than most Tories have. It might be no accident that Labour's promise of more workers' rights has (do far?) survived the lurch to the right.

This does more than merely increase the chances of redistributive taxation, given that revenue-raising is necessary. It also means that Labour's instincts are not on the side of the opponents of economic growth: nimbys opposing new-builds and infrastructure investment; incumbents and monopolists opposing competition policy; rentiers opposing land taxes; lawyers and accountants opposing tax simplification. And so Labour is less likely to continue with policies that favour these vested interests and stymie the economy.

The incentives and constraints facing a Labour government will therefore be very different from those now facing it in opposition. We should not therefore be confident that the party's words now are a good guide to its actions in office. FBr96wrX0AAsjYm

There's a recent precedent here. When Theresa May entered Downing Street in 2016 she promised to fight "burning injustices". But little progress was made in doing so, because her time in office was consumed with Brexit. Which tells us that a Prime Minister's intentions are not necessarily a guide to their actions. As the man said, people do not make history as they please.

Sadly, however, there are big caveats here. One was pointed out by Robert Cialdini:

Once we have made a choice or taken a stand, we will encounter personal and interpersonal pressures to behave consistently with that commitment (Influence, p 57).

This, he says, can cause us "to act in ways that are clearly contrary to our best interests". Starmer and Reeves might know now that talk of "the nation's credit card" is gibberish, but they could come to believe it. There's a famous episode of Colditz in which a POW feigned madness in the hope of being sent home only to actually become insane. Labour faces the same danger.

There's also the fact that money talks. Even a small donation helped Reeves drop Labour's popular commitment to spend £28bn on decarbonization - and there'll be more where that came from.

And then there's the possibility that the causes of economic stagnation are so entrenched that even more radical policies than Labour is currently promising will not overturn them. Even if Labour does move leftwards, it might not be able or willing to move sufficiently so.

I can't say how great these dangers are: none of us can foresee the future. But I can say something. Even if a Starmer-led government offers only the small chance of sensible policies, it's a bigger chance than the Tories offer. And even out-of-the money options are worth something.

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