Balls' conference freebies

As the Labour Party conference in Manchester draws closer to the highlight of the party leader’s speech, the Shadow Chancellor Ed Balls has tried to steal the limelight from his namesake by proposing a stamp duty holiday for first time buyers. 

Balls undoubtedly will want to repeat the trick of his Conservative colleague George Osborne four years ago, who, with the Conservatives enjoying mainly ‘soft’ support in the polls, proposed a raise in the inheritance tax allowance for families to £250,000. Post-conference polling showed that the support for the Conservatives firmed up and Cameron was on his way to 10 Downing Street.

Yet, Balls may struggle to repeat this feat under current circumstances. In fact, his proposal may turn out to be a grave mistake for two reasons, one strategic, one tactical. 

The first reason why Balls may have miscalculated is that the country is in a different position now then it was in 2008. For the last two years, the public debate has been about how to pay down the debt in the best possible way, rather than about how to spend more. Although the writing was already on the wall in 2008, Osborne still operated under the impression of generous spending limits and the British public was equally thinking that there was still something to give away. Now, this has changed and the polls indicate clearly that voters expect the main battle ground to be over what and where to cut, rather than to make uncosted promises of additional spending. 

Yet, the second (tactical) mistake Balls may have made is one that resonates in particular with Labour voters. As spending is being squeezed, the Labour Party leadership is pushed hard to come up with suggestions about what they would do differently to the coalition. So far, there is a big yawning black hole (or a plethora of policy committees which may or may not report some time in the future) where there should be policies. This arguably leaves Balls and Miliband with little choice but to offer some little nuggets instead a coherent programme of reform. 

The stamp duty holiday fits into this tactic. It looks like short termism when Labour should instead strive to formulate a coherent programme to re-focus public services. Commentators have already noted how much Balls’ proposal smacks of Gordon Brown’s attitude to policy, echoing the lack of grand narrative and purpose of the last two years of Labour in power. 

So, there we are. As Balls reverts back to his old paymaster’s tactics, he may just come to regret his proposal as the country has moved on, for better or worse, to a time of spending reductions. The argument about what to cut and what not, is the harder one to have, but running away from it wont help Labour. 

On the personalisation of politics

A few days ago, the Conservative member of parliament Nadine Dorries once again made some impolitic remarks for which she wont be loved by her own party. Dorries described the Prime Minister and the Chancellor (members of her own party) as ‘posh boys who dont know the price of milk’. What she presumably meant by that is that Cameron and Osborne are ‘out of touch’ with ordinary people in this country. This is a line that has been relentlessly pushed by the Labour leader Ed Miliband and which culminated in his prompts to the ministerial front bench to reveal whether they would benefit from the reduction of income tax to 45% which is to come into force in April 2013. 

The public demand to reveal the income and assets of politicians has become stronger over the last months and you may think that this is the way is should go. However, I think it is mistaken for two reasons. 

First, it is a deflection from the real arguments that we should have: what are the benefits to society of particular policies and which groups may be disadvantaged or may inordinately benefit from them. Knowing whether any particular politician falls into one or the other group is of little use when assessing the overall impact of a policy on society. It does however personalise the debate. This focus on alleged individual benefits can only strengthen the suspicions of the wider public that politicians are engaged in conspiracies to further their own interest. This does not exactly serve anybody, given the low esteem politicians are held in right now. 

But personalising political debates also hints at a paucity of alternative arguments and it is a sign of the floundering tactics of Ed Miliband and his team that he favours this road. The facts of the last budget were portrayed in the public debate on a curiously lop-sided fashion. The centre-piece of the budget was the raising of the income tax threshold, instantly lifting the tax burden for 23 million people in the UK and taking thousands of the poorest families out of income tax altogether, a step that should resonate with Labour and its supporters. 

Yet it is probably a sign of the frustration that the coalition government has delivered some of what speaks to the core principles of the Labour Party that the shadow front bench have been left with little else to suggest in the public debate. Their fall-back strategy is to personalise some of the more marginal aspects of the budget (Labour leader Ed Miliband made much of a tax on pasties and visited a pasty shop on the day after the budget to drive his point home). Yet all this does is to bring about an unfortunate shift from debating policies to debating personal circumstances of politicians. Miliband and his supporters should be careful what they wish for.  

Once, and this is my second point, you start suggesting that it is the personal background of politicians which guides them in making national policy, this bandwagon may not be able to stop. If you argue that personal income guides taxation policy, why not reveal whether they are straight or gay when it comes to legislation on gay marriage? Or their medical records where health policy is concerned? 

It is also a terrain Labour would not necessarily do well in, given that Harriet Harman is one of the richest aristocrats in Britain and almost the entire front bench of Labour in the House of Commons has been educated privately (which puts them in the top 6% of earners in this country). And why stop there? Would the religious affiliation of politicians matter if they come to legislate on the reform of the House of Lords and whether or not the Bishops of the Church of England should retain their seats? Miliband is Jewish and I am sure he would agree that, say, discussing the religious affiliation of parliamentarians when legislating on the dis-establishment of the Church of England provides little to the public debate? 

So it seems the personalisation of politics is a dangerous path and does a monumental disservice to the conduct of political dispute in this country. Questioning the motives of politicians in making policy appears to run counter to the principles of mutual respect and rational argument. Let us hope that Labour turns its backs on this risky strategy. If they don’t, we all can only lose in the process. 

Polly Toynbee in overdrive

Polly Toynbee is back! Presumably she just couldn't bear the bad news arriving at her posh Italian villa from the shores of these green islands and so she had to cut her holiday short to write a piece that is riddled with class war terminology.

(You can read it HERE: http://www.guardian.co.uk/commentisfree/2011/nov/29/osborne-class-war-autumn-statement)

While she clearly pleased many of her supporters on the Guardian website with her comments, the Labour Party will lose in the long term if it thinks this immoderate language serves it well. The reason why Labour should tread carefully is simple. Osborne's autumn statement set out a series of factors that makes it impossible to eliminate the budget deficit by the next election. Toynbee is furious that this means more pain for everyone. Yet, what she fails to mention is that the government's plans to balance the books are now almost identical to the one by Labour. In fact, borrowing will be even higher now than under the Darling Plan, given the difficult economic circumstances for the next couple of years.

In essence, Toynbee therefore already got what she wanted: higher borrowing which will be spent on infrastructure projects up and down the country. So, why does she think this is class warfare when it is exactly what she called for only weeks ago?

The conclusion can only be that as Labour's plans to revive the economy and the government's budget are getting more similar, Labour is running out of the ability to portray itself as radically different from the coalition. Hence the shrill sounds from Ed Balls and Toynbee. Toynbee thinks there is only one way to go now: further to the left. For the moment, Darling's plan is still Labour policy. We will see over the next couple of weeks if the Ed Miliband and his shadow chancellor stay in the middle of the road.

The strange, the mad and the dangerous - Labour grapples with policies

Party conferences are times to impress the faithful as well as the wider public. To do this, you can put on memorable performances, or you can reveal novel policies that may define the public debate for a long time to come. George Osbourne's announcement about stamp duty reduction in 2007 was an example of the latter. It defined the discussion about the tax burden and tax justice at times of phenomenally risen house prices for middle Britain.

Labour's conference in Liverpool was a chance to present some equally impressive policies, yet the party decided to field policy ideas that must have puzzled many watching British politics. First up was the odd. On the eve of the conference, Ed Milliband announced that Labour would lower the tuition fee cap to £6000. This surprised many, not least the student unions, since it was Labour's policy to introduce a graduate tax instead of tuition fees. The announcement was hence a U-turn before a full policy was even announced, forcing the party to converge on the coalition's terrain who equally advocate financing universities through tuition fees rather than a graduate tax. Why Milliband felt the need to formulate a policy prematurely on something so sensitive and on something where the Labour party would only benefit from sharp differentiation to the LibDems will probably always remain a mystery.

The strange was to be followed by the mad. In his final conference speech, Ed Milliband announced that any future Labour government would tax 'bad' companies more than 'good' ones. He defined bad companies as those that are 'asset strippers', presumably meaning those that are private equity funded. Is he going to tax companies that create thousands of jobs in the British economy such as AA, RAC or Weetabix into oblivion? Labour as the job terminator, rather than the job creator? If this policy will ever make it into a manifesto, he will be asked, I imagine, what the difference is, not just between a bad and a good company, but also between a 'bad' and a 'good' job.

The list of policies however was topped by the announcement of the shadow culture minister Ivan Lewis that all journalist should have to apply to government for a license if they wanted to publish in the UK. Needless to say that I would not be able to write this blog if such a licensing scheme was to go ahead. The howls of disapproval (or rather the laughter of disbelief) started to rise through the media outlets almost instantly, with many Guardian journalist leading the march.

If you think about it, not even communist regime of Eastern Europe dared to introduce licensing schemes. They operated censorship in a far more subtle way. So what on earth motivated the shadow culture minister to suggest that government should decide who can and who cannot publish? Some journalists were quick to make some rather unkind comparisons between his suggestions and the situation in Zimbabwe.

I am certain this proposal will disappear quickly in the archives, filed under 'indefensible' but the fact remains that this ragbag of policy ideas reflect a party in philosophical and ideological confusion. Labour needs to regain its sure-footedness on policy otherwise it will stumble from one policy disaster to another.