James Kirkup in the FT has a nice piece saying that the centre-left needs more than just whines about Brexit and Corbyn, however justified these might be, but also needs a new economic model. I agree.

Successful political parties need an analysis of capitalism or - if you prefer - an economic narrative: Thatcher in the 70s had one, as does Corbyn today.

And to its credit New Labour also had one: some leftists tend to forget there was much more to the party then than "Bliar/war criminal".

New Labour believed that globalization and technical progress were tending to increase inequality by depressing demand for unskilled work and raising demand for skills. This lay behind policies such as tax credits and the minimum wage (to top up wages that were being driven down by globalization whilst preserving work incentives) and the expansion of higher education.

Such a project had much validity. From today's perspective, however, it is incomplete in at least three ways:

- It is insufficiently critical of the uber-rich. Peter Mandelson was famously "intensely relaxed about people getting filthy rich as long as they pay their taxes." And Gordon Brown fawned over top businessmen. What they didn't see was that top-down managerialism can worsen economic performance, and not just by contributing to financial crises.

- It failed to see that a degree, whilst perhaps necessary for a decent job, is not sufficient. The universities' strike reminds us that even educated erstwhile "middle class" workers face oppressive management, stagnant wages and little hope of owning property.

- It took for granted capitalist and failed to anticipate (as in fairness did almost everybody else) that productivity would stagnate for years. It is now no longer sufficient - as Gordon Brown thought it was - for governments to merely offer a stable policy framework and supply of skilled labour. We need more than that to raise growth.

Blair's achievement in the 90s was to recognise that Labour must adapt to a new economy. It must do so again today. But it is John McDonnell who recognises this fact whilst centre-leftists seem not to. Admirers of the Great Modernizer seem to be living in the past.

Which brings me to an issue. James writes:

Ownership... should be wider. You cannot ask people to back an economic settlement in which they have no stake. And this is about more than houses. The UK needs a real stakeholder economy for the 21st century: more tax breaks to encourage more employee share schemes to mirror those for senior executives. If it's good enough for the board, it's good enough for the rank-and-file. Community ownership trusts could hold equity issued by public companies and handed to their customers.

This is good. More ownership for the "rank and file", however, means less for existing owners. To justify this, you need to show that their ownership is unwarranted. And that requires a deeper critique of capitalism than the centre-left currently seems to offer.

But there's something else. The difference between a "real stakeholder economy" and full socialism is one of degree only. There's a perhaps indefinable point at which one shades into the other. James can support such policies as ways of improving capitalism, but I can do so as a form of interstitial transformation (pdf), or accelerationism, of the economy towards socialism.

Of course, there'll be disagreements about how far and how fast we travel down this road. But let's get on the road and find out just what these are. It's not clear to me that such differences of degree justify splitting the Labour party.