During the last two weeks, pieces by Uncut regulars Atul Hatwal and Peter Watt seem to have caused something of a controversy in Labour circles by suggesting that Labour keep to Tory spending limits. Peter’s piece was followed by a passionate defence of the current position by LabourList’s Mark Ferguson; not to mention a more wild-eyed, man-the-barricades-the-Tories-are-coming, ad hominem attack from Owen Jones.
So before making our minds up, perhaps we might take a cool, detached look at the case for change. The question of tax and spending limits is not new: indeed, it was raised on these pages back in March. However, given that spending is arguably the most critical question to answer before the next election and will quite possibly decide its outcome, it is important to construct the case clearly and calmly, brick by brick.
One. Historical evidence on beating incumbent governments. Since 1974, from the table below, no party has challenged an incumbent on a tax-raising platform, and won. In contrast, we challenged three times 1983-1992 on such a platform and lost each time.
Pledged to cut taxes, although raised VAT and arguably did not carry out the pledge. Cut spending.
Pledged to keep to Tory spending limits for two years, and did. Pledged balanced budgets and no increase in income tax for 5 years, and kept them.
Tory (in coalition)
UK changes of government after 1974
The tough questions: a. by 2014, why do we think that a political approach which hasn’t worked electorally in 40 years will work for us then? Especially when, in the political climate of the 1970s, people were demonstrably warmer to the idea of higher taxes in return for a larger public sector? And b., if it was felt necessary to do this in 1997 (growing economy) to get elected, why do we think raising taxes in 2011 (stagnating economy) a good idea?
Two. Accepting Tory spending limits does not mean accepting we got it wrong on the economy. Some argue that we did, and that we should do a mea culpa on the Brown years, and particularly on debt. But it is not a sine qua non: you can perfectly well have one without the other, as was argued here.
Three. Accepting spending limits does not mean accepting everything the Tories propose. A “thin end of the wedge” argument does not pass muster. What we need to argue about is the spending priorities the Tories are choosing, not the total cost of them. As have many oppositions before us, including ourselves in the run-up to 1997.
Four. Our current position is difficult to understand. Our current debate with the Tories of Cuts-Yes versus Cuts-Yes-But-Not-This-Far-This-Fast is, for onlookers, the difference between two subtly different shades of the same thing: think angels, head, pin. Or worse: they think we are against all cuts, as pollster Deborah Mattinson confirmed last weekend.
Five. Accepting spending limits does not mean loss of economic credibility. In fact, many commentators think that an even harder position (the aforementioned mea culpa) is required to regain credibility. Irrespective of this, it seems odd to argue that, while we are being – successfully – labelled as spendthrift, we should respond by raising taxes.
Six. The argument on overall cuts – not how we apportion them – is lost. Yes, it is. Ask anyone outside the Labour Party. We are alone in holding that view: 28% more people think the goverment cuts are necessary than unnecessary. And the gap is increasing.
Seven. We’ll end up doing it anyway, so why not now? Furthermore, if we do it at the last minute, it’ll be perceived as desperate – as Gordon Brown found out to his cost proposing belt-tightening before the 2010 election – whereas, done now, it can be perceived as wise and perhaps even brave.
Eight. It is not fighting the Tories on their ground and accepting their terms of debate: a movement Ed Miliband rightly warns against in his Friday Guardian piece. He is right that we cannot let them define the battleground: that is good strategic thinking. Not good strategic thinking would be suggesting that acceptance of realities, such as the constraints of the Tory tax position, is the same as letting them set the terms of the debate. Hatwal quotes Tory pollster Andrew Cooper: concede and move on. Or, as someone else said: grant me the serenity to accept the things I cannot change; courage to change the things I can; and wisdom to know the difference.
All that said, there could be one reasonable justification for our position: timing. That is, if we are intending to stick to these limits but don’t want to announce it as yet, for some strategic reasons not yet disclosed. Although it’s unclear what those reasons might be, and there are obvious benefits to announcing it sooner rather than later, this is at least an understandable and respectable position. It may even be Ed Miliband’s precise position.
Whatever the truth on this, a convincing counterargument to the above eight points – that is, a case for raising taxes going into the next election – is yet to be put forward. The case against is here, if we choose to listen to it with an open mind.
The people proposing these things are decent people who care about their party, too. They just want a debate.