This week’s speeches from Labour’s economic spokespeople – the Shadow Chancellor John McDonnell and the well-respected backbencher Rachel Reeves – reminded me of Ed Balls own economic plans for fiscal discipline to pay off the deficit alongside investment; it seems things haven’t changed that much.
Yet it also reminded me of the leaders’ debate in Leeds in May 2015. That night was encapsulated by the tragicomic moment that an audience member railed at Ed Miliband over Gordon Brown’s selling of ‘half our gold’ (at what turned out to be a relatively low price), as though it was the source of all our economic woes. It made no sense on its own terms, but the point seemed to capture a wider anger and distrust.
McDonnell and Reeves are attempting to succeed where Balls failed by securing Labour a fair hearing with voters on the economy. George Osborne agrees in principle with the idea of investment – disagreeing over how it is funded – yet Labour has persistently failed to convince voters that its approach even makes sense.
There are two reasons for this; Labour’s failure to refute the claim it ‘crashed’ the economy. The second reason, which exacerbated the first, has been a persistent inability to speak in language that voters can relate to, unlike the Conservatives talk of household budgets and credit cards. This may be anathema to the new ‘straight talking, honest politics’, but it is necessary.
Labour needs to draw simple analogies that voters can engage with. For example, the national debt is like a mortgage on a house, which you repay every month. But you must also invest in repairs and improvements on your property so that when you finally pay-off your mortgage, it hasn’t fallen into disrepair and is worth as much as the other houses on the street. Failure to invest now will reduce its value in the end. Don’t talk about returns on investment or cost-benefit ratios from nationally significant infrastructure projects, but things people understand deal with every day in their normal lives.
When Labour was accused of not fixing the roof while the sun was shining by running a small deficit, make the point it was; investing in public services was the roof that needed fixing. Respond in the same terms; don’t mention historically low budget deficits and the propensity to run deficits in the post-war period.
When it’s claimed Labour recklessly maxed out the nation’s credit card, the key is to point out the purpose of a credit card; it’s short-term borrowing, often used in emergencies, such as when the boiler breaks or the car needs an MOT. Don’t mention the Government’s ability to sell Gilts at historically low levels. And don’t challenge what is terribly flawed analogy; it’s too late for that unless you have a much better one.
When Labour was accused of crashing the economy (and hence, voters didn’t want to ‘hand back the keys’) it should have made the point that if a household loses its main source of income – through say, the loss of a job for the main breadwinner – having debts like a mortgage does make things worse, but it didn’t cause the job loss. Britain’s bread winner was the City of London, which was consumed by crisis; point this out. Losing your job is often beyond your control, just like global recession is beyond the control of national governments. Don’t mention US sub-prime mortgages and Credit Default Swaps.
Former Chancellor Alastair Darling called in 2010 for the deficit to be eliminated by 2020. George Osborne pledged to do it five years faster but will probably now take the same amount of time. Labour should have called this out; sometimes we pay off debts over a longer period to make it more manageable and to ensure we can still put food on the table. Talking about global economic volatility is not the best idea, nor is trying to explain the unique nature of public date and how its value can be reduced by inflation.
Economically these examples don’t make much sense, but neither have the Conservatives own. Politics is not necessarily about who has the most logical argument or best evidence base; it’s as much about being heard and powers of persuasion. Like good fiction a soundbite, popular fallacy or glib analogy will sometimes reveal a truth that voters can really connect with; a lesson worth its weight in gold; at today’s prices anyway.
the P in Politics 