Corbynism (or why Nuneaton has a point)

I think Jeremy Corbyn would be an electoral disaster for the Labour Party from which it would take at least 10, probably 15 and quite possibly 20 years to recover. Too many of his supporters seem either indifferent to electoral success or utterly unaware of what that requires – but they’re right that the rest of us haven’t talked enough about policy. So here are a few of my concerns about his policies.

Jeremy says some things I support but don’t believe the British people will currently buy (a clear defence of higher taxes, though not necessarily his specific ones). There are also some I support and think they might well buy (universal childcare). But much of Corbynism isn’t just unelectable, but ill-thought-through, impractical and downright wrong.

Housing policy

Jeremy is calling for rent controls, with rent levels fixed in relation to earnings. Sounds wonderful: so why doesn’t Shelter buy it?

If you just cap prices in a situation where you haven’t got enough of something and too many people want to buy it, odd things start to happen. In this case, lots more people might sell rather than buy. Granted, we’ve all been saying we want more people to be able to buy homes. But what happens to people who can’t afford a deposit (or the still-uncapped mortgage payments) if the rental stock reduces too rapidly and the total housing supply doesn’t increase fast enough to match?

Will landlords just become more discriminating about people’s characteristics rather than the price they charge (‘No DSS’)? Will they cut back even further on things like repairs? Or will they subdivide properties more and more? More nuanced policies might be a different story (look at the rest of Europe, or the 2015 Labour manifesto), but just legislating a problem of supply and demand out of existence won’t work.

Jeremy is also proposing to extend some kind of ‘right to buy’ to the private sector. First of all, that seems a very odd spending priority for housing: our primary problem is insufficient stock, so why spend however much money on yet more subsidised ownership? (And since people in social housing have lower average incomes than private renters who can afford even a discounted property, isn’t it an odd distributional choice too?)

Second, how on earth would you control the cost? Right to buy may have done great damage, but at least councils actually owned the asset which was being flogged off: here, the state would have to pay the difference to landlords. (I suppose we could theoretically just take people’s property and give it to someone else at an enormous discount. Good luck getting that past the European Court of Human Rights.)

Third, why would you ever rent out a property if you could have it taken off you at any time? Like it or not, plenty of people can’t or don’t want to buy: they need a reliable private rented sector. By all means talk about how to improve it. But treating private rent with such abandon could really harm people who desperately need somewhere to live.

NATO membership

Jeremy has said he wants to leave NATO – our principal defence guarantee. Right now, our ‘if all else fails’ policy is NATO and, via NATO, the US commitment to Europe. We know that Jeremy doesn’t intend to raise defence spending way beyond 2% of GDP – it’s just about the only thing he’d definitely cut. There’s arguably an implicit defence guarantee in the EU treaties, and we have a European Defence Agency to co-operate on procurement, but these are a) pretty vestigial and b) exactly the kinds of things Jeremy won’t want the EU doing (assuming we stay in: see below).

So, given the rapidly rising costs of defence, Corbynism is offering us a radically reduced domestic capability, the abandonment of our key security guarantee and no replacement for either. That is not a defence policy. It’s crossing our fingers and hoping everyone will be nice to us forever.

EU membership

Jeremy has said he wants to fight for ‘a better Europe’, though we still don’t have a definite answer on how he’ll vote in the EU referendum.

Labour should, apparently, set out its own position on reform negotiations – which is fine as far as it goes. But almost nothing on David Cameron’s shopping list is going to appeal to Jeremy – and I doubt anything on Jeremy’s list will appeal to Cameron. The only real question is how much further Cameron will succeed in taking the EU away from Jeremy’s ideal.

If Jeremy might vote No, what would be his alternative? The European Economic Area (most of the free-market regulations without any say)? A Swiss model (slightly fewer regulations, slightly more say, but not a model the rest of Europe will ever offer)? No deal at all (and new tariffs on half our trade)? What makes him think Britain would discover the joys of radical socialism after voting with UKIP? And how does it help climate change negotiations to weaken one of the better players in said negotiations?

Again, this isn’t a policy. It’s a vague statement that the EU should be different, with no route map to change it.

The list goes on. You can’t talk about a ‘wealth tax on massive incomes’, fail to recognise that wealth and income are different things, conflate annual wealth taxes with one-off windfall taxes and expect to be taken seriously. You cannot talk about £50 billion of uncollected tax as though you can easily collect it in one fell swoop and expect anyone to think your sums add up. You cannot describe ‘not reducing our deficit as quickly’ as ‘funding’ free tuition and expect anyone to trust you not to wreck the public finances.

We’re not the Green Party: we’re supposed to be choosing a future Prime Minister. You cannot ask to govern a country with policies like these – not because they’re unelectable, but because they’re unworkable. Nuneaton wouldn’t buy Jeremy’s pitch: but we shouldn’t even be trying to sell it.

Organise and divide? Belated musings after the J30 strike

One of the current Government’s core tactics, when it comes to steering through cuts, is defining different groups against each other. Whether it’s pitting private sector workers against the public sector, justifying cuts to housing benefit on the basis of unfairness to people in work or distinguishing deserving from undeserving social tenants, the Coalition understands the political gain of identifying a particular group, claiming that they’re gaining unfairly and then cutting in the name of fairness.

One nation social democrats?

Left-wingers have tended to argue against this kind of narrative, for obvious reasons. They reply that, even if ‘divide and rule’ sounds effective, it doesn’t cut much ice in a two-earner household where the only reliable pension is from the public sector employee, the family whose 20-something son or daughter is on ESA but whose parents are in full-time work or the low earner in London who relies on Housing Benefit to pay the rent. There is, of course, a lot of truth to this: the lives of people in different jobs, different housing tenures and different personal circumstances are often deeply intertwined.

Note, though, how much these examples rely on people’s own specific lives being intertwined. Not every public sector worker lives with, marries or relies on someone in the private sector; most families don’t have a member on ESA. In fact, assortive mating means that people are often likely to end up with people like them than not. (The overwhelming majority of people I know work outside the for-profit world – the state, political parties, universities, charities, NGOs … almost anything, in fact, but a private company.)

Partly as a result, many of these divides are more real than social democrats like to admit. In my own family, some of our most visceral differences come from the fact that I don’t work for the private sector, but my father does. Left-wingers’ own attitudes often contribute to those divides: in my heart of hearts, I know that I tend to place the public sector, its values and its ethos higher on my priority list and to treat it as an ethically better option. I’m not saying I should: I’m saying I recognise my own prejudice – and that it makes it harder, not easier, to win over people who do work in the profit-making economy.

Trade unions suffer badly from this – and it’s very hard for them to get out of the bind. It’s worth noting that, since May 2010, unions have been keen to ‘speak for society’ and to emphasise their role in defending public services. Unions 21’s new report highlights some of the problems they face presentationally, both through their own failings and through hostile reporting; but at least part of the problem is intrinsic. Trying to articulate the national voice is, by its very nature, going to be in tension with action on behalf of members’ specific interests: not necessarily in conflict, but in tension. When considering responses like the 30 June strikes, this is worth bearing in mind. The unions’ great opportunity is to be seen as on the side of the public; their great danger is convincing the public, again, that their powers need to be curbed.

Justice versus envy?

Left-wingers can also risk playing to the Coalition gallery in the way they talk about justice. Much of what we consider to be justice is, of course, decried by the right as the ‘politics of envy’ – when complaining about the super-rich, for instance. Now, of course, this is spurious: there is a distinction between saying ‘the wealthy in our society have too great a share of the wealth, while millions of people are in poverty’ and saying ‘I haven’t worked my way up the ladder, so I want to pull you down to my level’ – and if we can’t make that distinction, the debate about fair shares is effectively over. But, rhetorically and in the eyes of people less committed to our own values, the line is a hard one to police. Arguments about ‘reverse class war’ may make it more difficult, rather than less – though it’s important to remember that defining a privileged minority working against the interests of most people is a long tradition of the left, as well as the right (People’s Budget, anyone?).

This is part of the reason why, when dealing with tax paid by the wealthy, issues like tax avoidance are so useful. They tap into a very widely held view that the rules should be the same for all of us – providing a way of arguing for the wealthy to pay their share and binding us together, as a society. (Even Ted Heath talked about ‘the unacceptable face of capitalism’, after all.)  In particular, this argument helps to explain why focussing on paying due rates of tax, rather than just raising the rates, tends to have a wider political appeal.

All in all, I have more of a sense that there’s a problem than I have of the answers. But for what it’s worth, people on the left need to be aware that they too have prejudices in favour of particular social groups (maybe even vested interests … sometimes). We need to ask ourselves whether we make enough effort to engage with others – private sector workers in particular, who do after all provide much of the revenue for social programmes. We need to do more to connect campaigns to the wider good – where union campaigning can be linked to the interests of patients, pupils, parents and families, it should be. And we may even have something to learn from the language of one nation conservatism: it was, after all, Benjamin Disraeli who first talked of ‘two nations’!

Deficits: paying for credibility

In a way, it’s easy to be a leftie just now. £81bn of spending cuts and only £29bn of tax rises fill most social democrats’ hearts with dread – and as the scale of what’s in store becomes clearer, the public are likely to be pretty horrified too. So unless you’re a left-wing Lib Dem, the line to take is less complicated than at any time since … well, since the last time the Tories were in power.

I think, though, that this could present a very real trap. It’s refreshing for the left to be able to rail against the enemy’s Budgets; even more refreshing when the public is quite possibly on its side. But Labour’s problem now isn’t just (or even mainly) about popularity per se; it’s about credibility. And that’s exactly where just railing won’t get them very far.

This isn’t just a case of it being unclear what share of the deficit Labour should tackle through tax rises (40%? 50%? 60%?); that’s a cause for concern, but you could argue the party needs some time to redefine itself and that Ed Miliband hasn’t even been leader for four months yet. More worryingly, though, I don’t see any real evidence of Labour engaging with what any of these options actually mean. I understand the difficulties: a party which still remembers what tax plans did to their chances in 1992 is obviously going to have its worries about talking about tax rises too much. But like it or not, Labour’s economic and fiscal record did a great deal to lose them the last election. It may very well be (mostly) unfair, but it’s also a fact of political life with which Labour needs to come to terms.

That means that, even though Labour thinks the deficit should be reduced at a more measured pace, it needs to show it has an idea how it might go about doing so eventually. Bankers’ bonuses, tax avoidance and going for growth by postponing cuts won’t cut it as an economic policy for the next two parliaments. Of course Miliband and Johnson don’t need a detailed Shadow Budget – opposition is not government and the Tories never presented one when they were out of power. But some sense of where the pain would be felt by the public themselves may be important – because it would help to provide some credibility for the Opposition. It’s worth bearing in mind that, if the UK wanted to cut the deficit at the current speed but do half of that through taxes, we would need to raise an extra £26 billion per year by 2014-15.* When the fiscal challenge is that big, ‘no pain (for almost all of you)’ is a deeply implausible message – even if it’s only implied. ‘Pain fairly shared’ sounds less appealing, but has a better chance of being believed.

The need to have alternatives in mind will get more pressing, because the arguments over the speed of deficit reduction will be overtaken by events. I think the Coalition were very wrong to pin their colours to the mast in the way that they have: but they’ve now made it critical to their political, and quite possibly market, credibility. That means that, unless the economy really does go into reverse as a result (in which case all bets are off) or the Government falls (which would have its own problems in terms of market panic and thus the required speed of the tightening), we’re stuck with this pace. By 2013, if the economy hasn’t gone into a double-dip recession (even if growth is sluggish), ‘don’t do this so fast’ may very well seem like yesterday’s news.

So there needs to be a better sense of what Labour would do, not just when it would(n’t) do it. But that also needs to be informed by a clear sense of why Labour wants to do it in a given way. When Alan Johnson talked about shifting the balance of tightening towards taxes enough to roughly halve the size of cuts to capital expenditure, we had a hint. The consistent focus on ‘who pays’ is another. These need to be more explicit. If Labour’s attack is consistently based on ‘what will a particular cut do to our ability to grow the economy?’ and ‘will this cut mean that the poorest are hit hardest?’, then you have the beginnings of a consistent approach to the deficit.

Of course, there is an obvious next question: what sort of tax rises could you go for to cut the deficit, if you’re going to argue that taxes should take more of the load?  Again, Labour doesn’t have to have a fully worked-out Shadow Budget; but it needs to understand the magnitude of the shift it might end up arguing for. But that’s for another post.

* According to the Emergency Budget, £83 billion of spending cuts and £29 billion of tax rises. The Spending Review set more money aside for capital investment, reducing the scale of cuts to £81 billion. A 50/50 split would amount to £55 billion in net tax rises and £55 billion in cuts – an extra £26 billion of taxes on top of the planned £29 billion.