If there is one thing the Conservatives have done exceptionally well over the last five years, it is to convince the general public that the crash of 2008 and subsequent recession were entirely down to Labour.
They have also convinced huge swathes of the electorate that the answer to a recession and the best way to help the economy grow, is austerity. Indeed both of these rhetorics have been so successful that even the Labour Party themselves seem to have accepted them as truth.
Last week’s episode of Question Time (14/05/2015) provided a great example of this – Tristram Hunt, Labour’s Shadow Secretary of State for Education, was challenged by an audience member to explain why voters should trust his party when it was they who had ‘broke[n] the economy’.
For a moment it looked as though Hunt was going to argue against the idea that somehow the global economic crisis was caused solely by Labour, but that wasn’t to be the case.
When asked directly by David Dimbleby whether Labour had overspent, he answered yes. It is testament to the power of the Conservative rhetoric that has been told about the economy that at this point the crowd started cheering and David Dimbleby congratulated Hunt on being the first potential new leader of the Labour Party to ‘admit’ that they had got it wrong.
But here’s the thing – they didn’t ‘get it wrong’. When Labour came to power in 1997 they inherited a large deficit and debt from the Tories, and over the course of their 13 years in Government they reduced it, significantly. In the process they built and/or fixed schools, hospitals and other vital public services that had been neglected by the previous Tory Government (public spending had been at an historic low – 14th out of 15 in the EU). In short, they did what a government is supposed to do.
The level of debt and deficit that was being run by the Labour party prior to the financial crisis of 2008 was not seen as a problem by anyone, least of all the Tories who pledged to match Labour’s spending pound for pound. It was only after the recklessness of the banking sector had brought the worldwide economy to its knees and Labour had bailed them out with tax-payers money that the deficit became a problem – the crash itself something that was clearly not Gordon Brown’s fault, regardless of what the Daily Mail want you to think.
If anything, the cause of the recession could be traced back to the Thatcher years, and the deregulation that allowed the quest for wealth to become the be all and end all of the financial sector.
The Tory rhetoric that Labour merely wasted public money on failed projects and welfare were refuted in the London School of Economics and Political Science’s 2013 study ‘Labour’s Social Policy Record: Policy, Spending and Outcomes 1997-2010’. The figures show, in black and white, that during the Blair/Brown years public services improved markedly due to increased public spending, and that although wider inequalities persisted, social outcomes improved too.
To quote the LSE, “...where Labour targeted investment, outcomes improved. Increases in spending facilitated a reduction in rates of child and pensioner poverty, shorter hospital waiting times, improved teacher-pupil ratios and improvements in neighbourhood facilities.”
The fact that the deficit and public sector debt actually went down during this period puts paid to the Tory idea that the only way to reduce these things is to cut spending. Indeed, as many world renowned economists (such as Nobel Laureate Joseph Stiglitz) have pointed out, austerity does not and cannot work as a method of reigniting a struggling economy, and will only serve to widen the gap between rich and poor, stifle growth, and increase unemployment.
A follow up study to the LSE’s look at the effects of Labour’s social policy was released this year. ‘Social Policy in a Cold Climate’ looks at policy changes from 2007 (and the beginning of the recession) onwards, and maps the disastrous effects that the coalition’s austerity programme has had on ordinary people.
To go back to my original question then – are Labour incapable of telling the truth about the economy? Well it certainly appears to be the case. For some reason – perhaps because they think that the ‘Labour broke the economy’ line is too ingrained in the public mind to be changed – they seem content to put their hands up, say they overspent, and carry on pledging more austerity, albeit to a slightly less drastic extent than the Conservatives.
A lot of people have claimed, and continue to claim, that Labour lost the election because they drifted too far to the left and didn’t take enough responsibility for their past ‘failings’. They want the party to move back to the centre ground of politics, but the evidence suggests that this is the wrong approach.
The truth is that Labour under Ed Milliband did not move far enough to the left, to where traditionally Labour would be strongest. One must only look at what happened in Scotland to see that a genuine leftist, anti-austerity party, which swept away the prevailing media and political rhetoric about the economy and the need to tighten our belts, is a far more popular prospect than a Labour party that is no longer the party it was, one of the working class, and offers little more than austerity-lite. The effect of the current storyline with regard to the past decade of economic history on both public opinion and, more alarmingly, on Labour's own positioning, reflects a very real danger that emerges when the historical narrative is established on rhetoric, or indeed anything other than fact.
If Labour truly want to become an electable party again, they need to go back to their roots, and start telling the truth.