Labour needs a new Tony Blair.

I mean this in a specific sense. In the 90s, Blair realized that the economy and society had changed and so old-style leftist and rightist policies were no longer relevant; one of the key texts of New Labour was entitled Beyond Left and Right, and Blair repeated the words "new" and "modern" not just as spin, but to emphasize that new times needed new policies.

This is what Labour needs to do now. I mean this in at least four senses.

First, there's the threat (to say the least) of secular stagnation, whereby a lack of monetizable investment opportunities mean slow trend growth in the west. This is manifesting itself in stagnant labour productivity - which means flat real wages.

This renders both Thatcherism and a bit of New Labour out-of-date. Both used to believe that the private sector would deliver growth if only governments could set the right framework; a small state in Thatcherites' case, policy stability in Brown's. In an era of secular stagnation, however, neither is sufficient (though they might be necessary). Governments need therefore to think more about how to promote growth. If "aspiration" has a sensible meaning, it means a set of policies to raise productivity and hence wages.

Secondly, the nature of inequality has changed. New Labour worried about the 90/10 ratio and thought that this could be narrowed by education and tax credits. Today, though, inequality is about the incomes of the 1%. Insofar as this is a problem - and I think it is - it needs different policies.

Thirdly, one relatively new feature of the economy is job polarization - the decline (pdf) of middling employment, a process which might be exacerbated by future (pdf) technical change. Combined with flat productivity, this means prospects for less-skilled workers are doubly bad as it means there'll be fewer middling-skills jobs for them to move into. This makes social mobility even less likely.

Fourthly, we now know something that left and right didn't know in the 80s and 90s - that there are severe limits on what managerialism can achieve. Increased power and income for bosses hasn't raised productivity in either the private or public (pdf) sectors, but has increased rent-seeking - a point which even rightists are coming to appreciate.

My point here is not to suggest a precise menu of policies to address these developments - though I suspect decentralized decision-making should play a big part. It is instead to say that we need to recognize today what Blair saw in the 90s - that the economy has changed and there is no point fighting old out-dated battles. I fear, however, that - paradoxically - some Blairites don't seem to appreciate this.