Rachel Collinson (prospective parliamentary candidate for West Ham) reflects on the 2015 General Election results.
I’ll give you somebody to blame.
As Labour begin the inevitable scapegoat search after a shock election defeat, I can’t help but join in.
I did, after all, once donate regularly to Labour. And, although I dislike the authoritarian, militaristic side to their more recent incarnations, they still have policies that I agree with. Getting rid of the bedroom tax, for one.
So I want to offer a perspective to my friends in Labour, as a friendly outsider, that may help in the licking of wounds and regrouping.
No beating about the (George) bush
OK; I’m going to dive straight in. Do you want somebody to blame?
Blame Ed Balls.
I can almost sense you eyeing me skeptically here. He may be unable to recall the names of any business leaders who support Labour, and he needs to avoid Twitter when tired, but really? He’s human, isn’t he?
Yes, of course. But the problem is that Balls should not have been in charge of Labour’s economic strategy.
It’s the economy, cupid
So, the British people are in love with the idea that only the Conservatives can be trusted on the economy. The press play this tune, and the electorate dance along to it.
The worst of it is, Labour dance too.
Weirdly, it was left to Caroline Lucas (and other Greens, myself included) to defend their track record on the economy from 1997 to 2010.
You may disagree with their spending priorities (as I did) but the fact is, Labour had more years with a budget surplus than the previous Tory administration. One of the first things they did in power was to prevent Government from raising interest rates to bribe the voters before an election, causing damage to the economy. And they did exactly what a Conservative administration would have done during the financial crisis of 2008 – spend hundreds of billions of pounds to prop up our financial system.
I’m not saying that this is what we should have done, but it is certainly what George Osborne would have done.
Where it all went wrong
Labour decided not to turn the tables back on Osborne, by asking the obvious questions: –
“Would you have bailed out the banks, George?”
“And where would you have got the money from for that, George?”
Instead, they appeared meekly to accept the Tory criticisms that they mismanaged the economy. Why?
Balls is a monetarist. This means he believes – along with the Conservative Party – that the best way to grow the economy is to cut public spending. It’s called expansionary fiscal contraction, and just like it sounds, it is a contradiction in terms.
This mistake allowed Cameron and Co to pitch the battle on their own, familiar turf, and – gasp – they won.
What should Labour have done?
Labour should have done exactly what the SNP did. They should have shown that cutting public spending during a recession is like quitting your job so you can pay off your student loan.
They should have pointed to Germany and the US, economic powerhouses both, who did not adopt the deep cut strategy.
They should never have chosen Ed Balls.
What to do now?
The people of the UK – and even UK politicians – are garishly naïve about economics. Yes, even rank-and-file Tories.
Take, for example, a prospective parliamentary candidate speaking at a hustings, to whom I had to explain the difference between deficit and debt. Of course, for Conservatives, it’s convenient to be economically illiterate, because they will pursue an agenda of small government regardless.
But for the left, we need to be smart. We need to find simple frames to explain how the economy works, and what drives it.
For me, that will be a direct appeal to small business owners, farmers and freelancers. A recognition that they create most of our jobs. A recognition that they are the real wealth creators. A recognition that they are suffering terribly because of subsidies, tax reductions and a liberal approach to the rule-breaking of large corporations.
Small will be beautiful
- Abolishing employers’ National Insurance contributions, because they are, essentially, a tax on jobs
- One rate of corporation tax for small businesses, a higher rate for large ones, as they benefit from economies of scale
- An abolition of VAT on tourism businesses such as hotels and restaurants
- Support for farmers through subsidies for healthy, fresh produce such as fruit and vegetables
- To fight hard in the EU for reform of the Common Agricultural and Fisheries Policies that have affected our smaller farming and fishing businesses so unfairly
- Stronger penalties for late invoice payment
- A commitment to net neutrality
- An end to the unfair and discriminatory policy of chasing small businesses for unpaid tax while turning a blind eye to large corporations’ failure to pay
- Mandating BT to bring super-fast broadband to everybody
- An end to workfare schemes that essentially provide free labour to large corporations
- An increase in small business rate relief.
To see how these policies work in practice, just take a look at Brighton. A booming economy, superfast broadband for Brighton businesses, thousands more visitors every year, and Caroline Lucas gaining the title of the FSB’s Small Business Champion.