Round one to the unions, I would say, in the battle to get themselves into the cuts debate on their terms rather than those of a media itching to portray them as some dreadful throwback to the past, or a coalition that wants to portray them as living in denial about the state of the economy.
There will always be some who know they can get noticed by going over the top, but the general sense emanating from Manchester yesterday was that the TUC have something legitimate to say about what is happening in Britain, and they intend to say it in a way that speaks not only to themselves, but to a broader audience.
I was struck by this comment which appeared here yesterday, from someone called Teresa … ‘I watched the Union Leaders being interviewed on Sky and the BBC today, I found it so enpowering to listen to them, finally knowing we have people on our side. I thought they were all so calm and articulate, the exact opposite of what the press would want to see.’ I didn’t watch any of the rolling news coverage yesterday but I did pick up signs that the unions knew there was a big trap to fall into and they were determined not to do so.
If they understand that they are now in the position where the general public, not just their own members, are up for listening to what they say, they will have taken a big step forward, and one that can push the coalition backwards in public esteem and in its confidence about seeing through the more ideological of the cuts planned.
Talking of never forgetting that general audience, rather than believing you are merely speaking to those in front of you at the time, I thought it was to David Miliband’s credit that he, alone of the leadership contenders, did not commit on the spot to a rally planned for October 19.
A lot can happen between now and then, not least the fact that we will know who the new leader of the Labour Party is. Making major diary commitments in public, without any regard to what else might be going on, has never struck me as sensible time management. If David becomes leader, hopefully by October 19 he will have his own plans for taking on the coalition, and it will be up to him to decide nearer the time whether attending a rally fits in with them.
Saying ‘yes, of course I will attend’ would have been the easy answer to give, and to warm the hearts of those asking it. But just as several union leaders did well to resist the pressure for lots of gesture politics yesterday, it seems to me that so did David.
A new poll says that 74% of voters reject the speed and scale of cuts.
Only 22% support Mr Osborne´s decision to eliminate the deficit in one Parliament. 37% support Labour´s original plan to halve it by 2014.
More people blame banks and global recession for the deficit than Gordon Brown. I am personally happy to hear this, as this has been my message for a long time. Best of all, 49% now blame David Cameron and George Osborne for the deficit!
On Oct 21 Labour will be the biggest party in the polls, regardless of who the next leader will be. Government´s approval is now down to 37% – 45% do not approve.
Trade unions are not an “enemy within”. But they need allies to their resistance to the coalition. The unions, by the way, have 7 million members.
Ed Miliband has said that we need to strengthen the unions because of a rise in inequality. The share of wage in national income has fallen from 65% in the 1970s to 53%. This is one of the reasons why Labour lost.
Political campaign to win the economic argument against austerity is needed. Labour must offer an alternative.
IMF warns of the human cost of public spending cuts. According to IMF livehood, security and dignity of millions is under threat. And there is also risk of recession.
Professor Anthony Seldon recently wrote in the Guardian that vision counts now. Labour´s challenge is to find a visionary leader who adopts the party in the light of profound socioeconomic change to ensure social justice.
This is why Ed Miliband may outdo David.
Guardian editorial today making similar point to your blog of yesterday. Also pointing out how Jon Humphreys was trying to take the story back to the past. You are right to point out the dangers of the unions and the left more generally playing into a situation that benefits the right.
I agree with your point on david M, but I wonder if it will not push a few more union voters towards his brother
For all those looking for some more ammo to fire at the condems James Cusicks article from the Herald makes interesting reading.
The cuts: Is there an alternative?
Chancellor George Osborne is set to announce spending targets for government departments
Special Report: James Cusick, Westminster Editor
Share 0 comments 12 Sep 2010
Chancellor George Osborne is only weeks away from announcing the spending targets that every government department will have to comply with from April next year.
Three months on from the general election, Osborne has told close colleagues that he knows the game has changed.
From wide-ranging national and international support on the urgent need for Britain to begin reducing the record deficit, Osborne and his Treasury team are aware they are already beginning to look ideologically isolated. One former Conservative adviser, who worked with Osborne when the party was in opposition, said: “The old room, once full of friends, is now empty. The deserters are running scared, happy for George to take the blame.”
This weekend it was the turn of the International Monetary Fund in Washington to question the ability of the global economy to deliver a level of growth that would return confidence to still-struggling national economies like the UK. Despite calling on developed countries to cut their deficits, the IMF’s figures suggest that things are going to get worse before they get better. This isn’t what Osborne or the Treasury wanted to hear right now. Early drafts on what Osborne thought he needed to say in his spending review speech to parliament have been ripped up as the case against “austerity now” is being matched with a growing lobby which suggests that harsh cuts will simply halt the UK’s fragile recovery.
Still obsessed with his election message of “We’re all in this together”, Treasury advisers have told Osborne that he needs to find a different mantra for the October speech.
The deserters are running scared, happy for George to take the blame. former Conservative adviser
As the BBC’s poll on the spending cuts revealed last week, three months on from the election, voters may still believe government borrowing should come down, but they don’t want the pain to fall in their own back yard. That means anything which points to an alternative to austerity now commands a bigger and more attentive audience.
Critical economic voices which previously looked isolated in the rush towards austerity are suddenly back in vogue as new economic data from the IMF and the Paris-based think-tank the Organisation for Economic and Co-operation and Development (OECD) suggest that fast-track belt-tightening could be the wrong medicine at the wrong time.
Professor John Van Reenen, director of the Centre for Economic Performance at the London School of Economics, has consistently questioned the coalition’s determination to paint draconian cuts as “unavoidable”. He said: “Although there is consensus that budget deficits need to be reduced, there is sharp disagreement over its pace.”
According to Van Reenen, Britain is now on the “extreme wing” of those demanding severe austerity now. The Obama administration in the United States remains firmly committed to continued state intervention and with that country’s economy still drowsy and unemployment still high, the focus isn’t on cuts, but on a further $50 billion (about £32.5bn) stimulus for infrastructure projects.
Though the Daily Telegraph in May claimed that “austerity is the new cool”, and looked to the then advice from the OECD to back up that view, things have changed. Three months ago the OECD backed the assault on deficits by G7 member states. Now it believes its own advice may be suspect.
Last week it said growth rates in the second half of this year would be lower than in the first two quarters. In cautionary language, it reported that there was a slow-down in the pace of recovery of the world economy and that this was “more pronounced than previously anticipated”. As a consequence, it said that the wealthy G7 member nations should now be considering “postponing retrenchment”.
Osborne and the Treasury have to listen to the OECD, but they don’t need to take its advice. The official Treasury response was that it would be pressing ahead with the planned cuts in public spending and it dismissed the idea that the plan might tip the UK economy back into recession.
Dismissing the forecasts of the OECD is one thing; dismissing the concern inside the coalition is another.
Despite the clarity of purpose by the Treasury, the deputy prime minister hinted last week that there is some worry beyond the Osborne inner sanctum that the austerity message is the wrong one: “I don’t think we should aggravate anxiety and fear by pretending there is a sword of Damocles coming down,” said Clegg.
Suddenly austerity is no longer cool – it is now politically dangerous. Clegg wants the entire spending review package to be put into perspective. The cuts, he said, won’t be annual, but spread over five years. That translates as pain, but not all in one session.
What Osborne intends to flesh out is the plans he first laid in the emergency budget in June. The coalition inherited a £155bn deficit and in response Osborne ordered a £113bn fiscal consolidation to take place over the next five years. The consolidation is £40bn more than Labour had promised, with £8bn more from tax increases and £32bn more in departmental spending cuts.
But going ahead with this plan, according to Van Reenen, “risks pushing the UK back into recession”.
Both Cameron and Osborne are on record as saying that the UK needs to be seen as being “open for business”. The emphasis is on export-led growth and advisers are keen to point out the example of Canada digging itself out of a recessionary hole with a tight regime of government cuts.
However, Van Reenen and others believe what Canada did is being misread. “Canada’s recovery after consolidation was through export-led growth as the US boomed,” he said. But as Obama knows too well, with mid-term elections in the US only a couple of months away, the US economy isn’t booming. The OECD and IMF concerns about the slow recovery mean that while the UK wants to do business, the business might not be there.
New figures from the Office of National Statistics will also dent Osborne’s hopes of pointing to export-led growth as a positive in the spending review. Trade figures for the last three months aren’t good: the UK, despite the cheapness of sterling, is running a £13bn trade deficit, the highest since the Bank of England was established in 1694. Take away the input from banking and other financial services, and the picture is bleaker still.
The foreign exchange and transfers firm World First doubts the proclaimed export-led recovery is possible in such condition. Their chief economist, Jeremy Cook, said: “These figures show that export-driven recovery will have to remain a dream for a while.”
Just how to tackle the new landscape is being decided in a series of different locations throughout Whitehall, but mostly inside the Treasury by the coalition’s “Star Chamber”. Ministers have to fight for their departmental budgets in front of an inquisitorial committee led by Osborne and the chief Treasury secretary, Liberal Democrat MP Danny Alexander. Those who have accepted and defined their new reduced budgets – anything from 20% to 30% cuts spread between now and 2015 – join the chamber to vet those still to deliver the shape of their regime.
According to those who have reports of what one called “the interrogations”, there isn’t concern over the IMF or the OECD in the chamber. Nor is there concern over the widening north-south divide or the potential fall in police numbers or how welfare will be affected if £3bn is saved from lowering the age child benefit is paid. The Star Chamber’s buzz words are “efficiency” and “reform” and “change”.
For one Liberal Democrat MP, defending a slim majority, there are jokes about the “naughty chair” for those ministers who don’t get where Osborne wants to go. He said: “There is a destination and the Chancellor wants to get there. The deficit is already the defining policy of the coalition. It defined it in May. It defines us today.
“Nick [Clegg] tried to change the tone last week. It barely registered inside the Treasury. If there is an alternative to this massive assault on Britain’s debt, I doubt we will see it this year or next. The man, as they used to say, isn’t for turning.”
For other Liberal Democrats – those with no ministerial responsibility and nursing private reservations about the consequences of partnership with the Tories – the lack of discussion on alternatives, given the new opinions from the IMF and the OECD, is worrying.
One said: “We all accept that doing nothing isn’t an option. Maybe this is dealing with the pain now rather than later. It will be next April before the cuts begin. It will be another year until their full impact is felt. By that time the economy could be in a far better position to cope.”
And if it’s not? “If it’s not then Mervyn King [the governor of the Bank of England] got it right in April when he said whoever wins this election will be out of power for a whole generation.”
Okay, I know economists are still disagreeing about the impact of the Wall Street Crash on the Depression, but Paul Krugman and others speak plain common sense when they warn of the dangers of huge spending cuts.
Osborne is not stupid and must see the logic to these arguments. Why, then, is he forging ahead regardless? It may sound far fetched but, as I’ve said here before, I wonder if they’re deliberately leading us into a double dip recession as a tactical step in ther ideological programme of reconstruction. When and if we double dip, they’ll blame it on declining world markets.
Hmm. I don’t see Ed Milliband as a ‘visionary,’ rather someone who has positioned himself very nicely and very conveniently as a bit of a Leftie to win the union votes he absolutely must hoover up to have any chance of winning. One of several things that worries me about him is that his ideological positioning is just posturing; that if he bags the leadership he’ll then do whatever any Labour HAS to do to have any credibility with floating voters, present himself very firmly on the centre ground of British politics. Secondly, his closeness to the Brown camp, true home for expertise in the Dark Arts of Politics (no matter what anyone says about Peter M. and our dear friend here, Alastair) only adds to my fear about his possible insincerity. I much prefer David MIliband in the above terms. If he doesn’t win the leadership, Labour will lose a 2015 election unless the ConDem experiment has by then completely lost the trust of the floating vote. But never mind ’83, this mob of upper class gangsters is in the process of writing THE longest suicide note in British electoral history.
People who are saying that “Red” Ed Miliband would take the Labour party to left are fighting the last war.
Ever since the cold war ended, people have largely voted based on values, not on ideology or class. Today´s big divide line in politics is between authoritarian v. liberal – not between left and right.
Anyway, can anyone in Britain define where the “centre ground” is in these days of “new politics”? I cannot.
But I can tell that the median wage in Britain is £20,831. Only 10% earn more than £40,000. So taking Labour to left might be a good idea…
Labour has lost 5 million votes since 1997. Only 1 million to the Tories. 3 million of the lost voters are manual or unskilled workers.
Is David Miliband best placed to win an election? YouGov poll tells us that 72% of undecided voters would be less likely to vote Labour if the party pursued New Labour policies.
So Labour must change. Ed Miliband is the change candidate. He has said that “we can neither win an election with the working-class vote [alone], nor can we take it for granted”.
I could think of some “gestures” I woud like to make to that lot. I really could ;o)
Very impressed with the TUC right now. John Humphreys on Today this week sounded palpably distressed that he wasn’t able to generate a tub-thumping playground fight live on air when he was trying to create a ’70’s Union war.
The Coalition is looking less confident daily as the ideology espoused by Dave’s unholy cabal (Gove, Fox, IDS, Gideon, Alexander + Cleggy) is exposed by the soft and fluffy Tory message being dismissed + washed away by the general public.
The UK is beginning to look incredibly isolated globally in it’s throwback to ’80’s Thatcherite politics. The media, so long in Dave’s pocket is beginning to rouse also, realising that supporting the Tories in the mid to long-term will be commercial suicide. Even the Sun is running stories about the betrayal to our boys, as they lose their jobs on the front line in the defence cuts.
Unfortunately – the only thing I fear for is the next leader of the Labour party. if the polling is to believed – and Ed is the chosen one – I fear that we will soon see David leaving front-line politics.
On the subject of cuts – interesting and staggering new report on what welfare changes mean in Scotland. Read it at http://www.scottishpovertyforum.org.uk/ImpactReport.pdf
Forum reveals impact of welfare reforms on Scotland’s economy
The Scottish Local Government Forum Against Poverty (SLGFAP) and Rights Advice Scotland (RAS) today reveal that between £514-£614million will be taken out of the Scottish economy as a result of the UK Government’s planned welfare reforms.
Today’s joint report, “People, Councils, the Economy”, details the consequences of the UK Government’s decisions to change Disability Living Allowance, Incapacity Benefit, Housing Benefit, freeze Child Benefit and increase other benefits, allowances and public sector pensions by the Consumer Price Index instead of the Retail Price Index.
Highlights from the report:
• In total the Scottish Economy will lose £514,000,000 – £614,000,000 each year, directly jeopardising 11,900-14,220 jobs.
• 20% of the current 340,510 Disability Living Allowance claimants will be cut removing £259,571,203 each year from people with disabilities.
• A new medical test will see 239,550 current Incapacity Benefit claimants losing £135,000,000 – £235,852,587 each year.
• The freeze on Child Benefit will deny £47,505,757 each year to 620,795 families currently receiving benefit for 1,034,100 children;
• 147,000 over-65s in receipt of Attendance Allowance will lose £28,099,780 each year.
• 75% of Housing Benefit 60,150 claimants will share in losses of £27,312,100 each year.
• 186,010 Income Support recipients will lose £10,833,222 each year.
• 137,108 unemployed people receiving Jobseekers Allowance will lose £6,577,430 each year.
• 99,860 Carers Allowance recipients will lose £4,725,375 each year.
• 49,450 Employment Support Allowance recipients will lose £2,879,968 each year.
• £17 billion in pension payments will be denied to more than 300,000 public sector pension recipients over the next 20 years.
Councillor Willie Hogg, Chair of the Scottish Local Government Forum Against Poverty, said: “The cuts and changes already announced pose a serious threat to household incomes, councils, jobs and businesses across Scotland. This will only get worse when further cuts are announced in October.
“As the report shows, the cuts equate to reducing the spending power of every woman, man and child in Scotland by around £100. But the reality is that the poorest, most vulnerable and those with disabilities will be burdened with shouldering the weight of these cuts because it is their benefits that are most affected. These cuts will also prove to be a huge setback in the ongoing fight against child poverty, any recent progress will be more than undone.
“And with those on low incomes tending to spend their incomes locally, small businesses across Scotland must be bracing themselves for a hammer blow. The economy in Scotland is taking longer to recover from the credit crunch and unemployment is higher than the national average yet these proposals will remove more than half a billion pounds from fragile local economies every year directly jeopardising more than 10,000 jobs. On top of this pension changes are set to remove more than £17billion pounds from the Scottish economy over the next 20 years.”
“The extra demands that reduced incomes and rising poverty will place on local authorities and other service providers will be considerable. Councils are already proposing to radically reduce their services in order to meet reducing budgets yet they will be expected to deal with greater demands on their services, particularly in the areas of social work, housing and welfare advice. Councils’ income from charges, housing benefit administration, council tax and business rates will also decline as fewer residents will be able to pay – in many cases local authorities will have to withdraw from service provision or make considerable increases in charges to those who can pay.”
Richard Gass, Chair of Rights Advice Scotland, added: “It is likely that frontline Welfare Rights Advice teams in councils across Scotland will face unprecedented demands from large numbers of people affected by these changes. Many claimants will need assistance with appeals or with seeking out alternative benefits. It is imperative that at the time of greatest need Welfare Rights services will be ready to meet that demand.”
As someone who works at BAE where we may be hit with severe job losses due to defence cuts can I thank Ed Milliband for taking the time to meet myself and Graham Jones MP to listen to us about the situation. Ed has also wrote to Liam Fox to ask him where he stands on the defence industry,
Can I also thank David Miliband for coming to meet the unions, interupting his busy schedule to talk to us on site.
well the unions seem to be much more moderate then days of old, thank god,
but if there is one man who could ruin that it’s BOB CROW , he is absolutely
detested, every time he opens he’s mouth the government will get more support from the country.
torieboy, ps hope you don’t mind a Tory commin on.