George Osborne is on Labour’s turf – how should the party respond?

It is five months since the exit poll that shattered Labour’s dreams of a return to office after just one term. Now, after an extraordinary and unexpected summer of internal debate, the party must face up to the task the electorate has presented it with for the next five years: opposing the first majority Conservative government of the 21st century.

The message that has reverberated from the leadership contest is the importance of offering a clear alternative. Labour’s professional political class has seemed unable to muster anything that looks, sounds and feels any different to business as usual; to the dark suits and yawning platitudes that have constituted our mainstream politics in recent times. Jeremy Corbyn’s obvious authenticity and demonstrable difference have driven a coach and horses through the party’s supposed certainties.

In light of this, there will be some temptation for Labour to become the party of ‘no’, burnishing its anti-austerity message, and through this seeking to offer greater moral clarity against the intensifying Tory cuts. The strong parliamentary presence of the SNP will heighten the allure of this route.

It would, however, be unwise for Labour to forget the lessons of its recent defeat. The first fruits of Jon Cruddas’s review into why Labour lost provided an important reminder that “the majority of voters in England and Wales supported the Tories’ austerity measures” and that “the idea of an anti-austerity alliance with the SNP is unacceptable to a majority of English and Welsh voters.” What’s more, recent Fabian research has estimated that 4 out of 5 of the votes Labour will need in English and Welsh marginal constituencies to win in 2020 will have to come direct from people who voted Conservative this year. So how can Labour credibly oppose the Conservatives while also rebuilding its relationship with the people of Britain? How can it offer a clear economic alternative at the same time as winning back trust?

The movement is everything

Labour’s first job will be to build and strengthen the relationships that allow it to stay together as a party and a movement, whilst tackling these big questions. Keeping Labour united was once seen as Ed Miliband’s greatest achievement, but has subsequently been deemed a dereliction, a failure to ‘have the argument’. But now, amid talk of viruses, resistance and a battle for Labour’s soul, the risk is that the party skips over renewal and regeneration to dive head-first into factional splits. Labour must find a way to have a deep rethink of its creed in a humble, civilised and plural manner. Indeed, the generosity and openness of this internal conversation will be a critical test of the party’s ability to match the

Conservative’s ‘one nation’ offer. A party unable to come together around its own sense of the common good is unlikely to be able to build a sense of common purpose with the electorate.

This means doing politics differently at every level. Traditionally, so much weight has been placed on the party leadership and the parliamentary party – and while they must be its frontline, actually renewal will come from below. Labour has always been a movement or it is nothing, and the democratic energy unleashed by the leadership contest has been a sight to behold. Now there is an opportunity to harness this and for local parties to build on the work of the American community organiser Arnie Graf in the last parliament, with which the party’s engagement ultimately proved piecemeal and superficial. Labour’s future lies as a radically decentralised organisation, where shared values and a sense of purpose emerge through relationships and action, rather than being imposed from above.

If the Labour party pursues this genuinely democratic project of institutional renewal, the task of the leadership will be to capture the emerging sense of shared priorities and reflect them in a politically salient strategy of opposition.

The Conservative’s ‘one nation’ challenge

In parliament, the starting point for any opposition is the Queen’s speech, the road map to the legislative year ahead. This is not just where a government defines its purpose, but is an opportunity for an opposition to do the same. It is a framework for an alternative story about the country, and the fulcrum for building campaigns outside Westminster.

The programme laid out by the Conservative party earlier this summer – in the Queens’s speech and the budget – was designed to put the Labour party on the wrong side of a set of political arguments that the government believes will damage it for a generation, and accelerate its decline as a party of the working class.

From immigration to trade union rights, from welfare and apprenticeships to the living wage and English devolution, the ground has been laid for a titanic narrative struggle. The Conservatives will attempt to present themselves as the party of quality education, affordable homes and decent wages for working people. At the same time, they will encourage Labour to use its political energy on opposing spending cuts, defending welfare, and aligning itself with big public service unions (which provide the party with a substantial part of its funds).

This sets Labour an unprecedented challenge, because blanket opposition to the measures on the table will give the Conservatives exactly what they want, whilst risking mortal damage in the eyes of the electorate. The test of Labour’s skill will be whether it can use this hazardous environment to spring the trap laid for it, and instead establish a new identity and purpose that takes it beyond the government’s intended stereotypes.

First and foremost, this will require it to capture the public imagination with a vision of the economy that delivers social justice through means other than just fiscal transfers: tax and welfare. An economic vision founded on contribution, reciprocity and the empowerment of citizens had begun to emerge before the last election through the policy review process, before it was abandoned by the leadership as they sought to ‘shrink the offer’. Returning to this framework, which has broad support across many parts of the party and was built through conversations at a constituency and local as well as national level, would finally allow Labour to challenge the Conservative’s one nation pretensions, whilst reclaiming its own historical grounding as the party of work and workers.

Opposing opportunities

Part of the response to the Conservative’s political gambit will be inevitably short-term and tactical. As well as the need to resist the most egregious legislative measures – or at least paint them as partisan and extreme, a departure from the ‘common sense of the age’ – the party will want to demonstrate that it can cause the government discomfort. But the choice of which fights to pick should be determined by the basic tasks of opposition: are there places where bad law can be made better, or where the government’s dominant narrative can be disrupted or undermined?

This requires looking at where the government is politically vulnerable, but also where cross-party and non-partisan alliances can cause it serious problems. In an era of rock bottom political trust, voices from outside of party politics can be uniquely effective in rallying opposition. The Health and Social Care Act 2012 is a good example from the last parliament, where Labour was able to secure significant amendments and political capital by working with GPs, the BMJ, the King’s Fund and the Royal Colleges, all of whom were lined up against Andrew Lansley’s reforms. As we look forward, the IFS will generally carry greater weight than Labour in determining (for example) if the government’s budgets really do ‘hit the poorest hardest’. The potential to call on voices such as these should help guide Labour in choosing where to focus its opposition.

Yes and, instead of no but

Some areas of obvious potential include the proposed reductions in working tax credits, which have already been condemned some self-styled ‘one nation’ Conservatives; the EU referendum bill, where the government is inevitably mired in in-fighting; and the troubled and divisive HS2 project.

No doubt these upcoming battles are already whetting the appetite of some Labour MPs. But to succeed in the job of re-building electoral trust and credibility, and to thwart the Conservative’s bigger political project, there are also areas where Labour must learn a language of unambiguous support, like the devolution bill.

Despite serious attempts to develop a distinctive Labour localism in the last parliament, Labour has been comprehensively outflanked on the issue by the ‘northern powerhouse’ project. ‘Devo-Manc’ is a fantastic opportunity to build civic pride, spread power, drive efficiencies and turn around some of the country’s worst health outcomes. It is also an opportunity for Labour politicians to control significant regional budgets at a time when it is out of power in Westminster. Cornwall’s new powers are a chance to put down roots in one of poorest regions of the country, where there is almost no Labour presence at all. Yet Labour has gone out of its way to find fault with the government’s devolution deal, too often sounding grudging and churlish. Instead, as Tristram Hunt put it in a recent speech to Demos, “we must shelve our timidity, match the Tory offer and go beyond it”. Better still, the plans to do so should be shaped and articulated by those already running successful Labour councils.

Strategic attack

But the biggest test for Labour will come in the form of the strategic elephant traps that have been laid by the Conservatives with such precision. While these are undoubtedly politically fraught, they also present opportunities for deep thinking about the party’s intellectual underpinnings. They are the prisms through which Labour must ask itself what is it for, in modern Britain?

A case in point: Labour’s meltdown in the high-summer sun over the welfare bill. It has been obvious for a long time that one of Labour’s biggest strategic weaknesses is that it is seen as the ‘party of welfare’. As a recently unearthed memo written by Ed Miliband’s pollster in 2010 put it: “Labour is seen to have been a principal architect and defender of a benefits culture.”

The easy thing to do here would be to blame the right-wing media for promulgating a ‘scrounger’ narrative, attempt to reframe ‘welfare’ as ‘social security’, and oppose the cuts with a righteous fervour. The harder thing would be to accept that, when people think of Labour as the ‘party of welfare’, they have a point. Ultimately, Labour’s welfare bind is a reckoning with how it has conducted its core business for over half a century: the ‘end’ of a more equal society has been pursued almost exclusively through the ‘means’ of the tax and benefits system. Fiscal transfers to alleviate poverty have been Labour’s way, more than tackling market inequalities at source or investing in the productive economy. So now the welfare bill asks it to choose between the devil of supporting greater inequality, or the deep blue sea of being on the wrong side of public opinion. The challenge for Labour is to develop a different answer – one that prioritises work and contribution, and reimagines the left’s purpose in an era of globalisation, scarce resources and complex problems.

If Labour were able to offer an answer of this kind, they would have a least a chance of defining themselves on their own, rather than the Conservative party’s terms. In so doing, they would also free themselves to exploit the Conservative’s weak flank: a welfare reform programme that leaves working people worse off. But to get a hearing on this issue will require a reckoning not just on welfare, but on the wider politics of austerity.

The biggest electoral task facing Labour is to restore people’s faith that their money is safe in the party’s hands, that taxes will be spent wisely. This is not the same thing as agreeing with George Osborne’s spending plans or accepting the increasing haste of the state’s retreat from public life. Nor is it the same thing as accepting the Conservative’s wider analysis about the economic necessity of austerity. But it does mean recognising the sharp differentiation from the government that the party seeks on spending must be found within a very shallow pool of economic trust; and that by proclaiming itself an ‘anti-austerity’ party, rather than laying out how it plans to invest in the productive economy, Labour will dry up that pool still further. All this points to the need for a political story that foregrounds the re-distribution of power rather than fiscal transfers; and makes the case for prudent public spending, focussed on areas that build the economy and have huge public support – including education, health, and essential infrastructure.

The trade union bill will provide a significant opportunity to set out this story clearly, if Labour is brave enough to take it. Undoubtedly, this is a pernicious and politically-motivated piece of legislation. The temptation will be to fight it tooth and nail as a partisan attack on Labour’s funding streams and an affront to workers’ rights. But while many of the proposals are indeed mendaciously designed, the unions risk falling into the trap of strengthening their dinosaur caricature. What if Labour, instead, recast it as a moment to reimagine industrial democracy in a post-industrial society?

This will require the whole of the labour movement to be self-reflective and clear-sighted. Union membership has been in decline for decades, a symptom of the hollowing out of a manufacturing economy and the rise of a service one. The density of union membership in the public sector continues to mask its dearth in the private. It is now a decade since the labour market expert David Coats warned in the Fabian pamphlet Raising Lazarus that “the rhetoric of struggle, strikes and strife has little purchase on the opinions of employees who care more about ‘getting on’ than ‘getting even’.” Little has changed in tone in the intervening years, meaning how unions look from the outside – white, male, middle aged, manual workers – rarely matches up with the profile of their members, who are more often than not graduate women working in offices.

Rather than weakening the unions, achieving the centre-left’s goals in the new economy requires them to have a much stronger role, putting democracy right at the very heart of how the economy functions. The aim must be, as GDH Cole put it, to move trade unions from “a bargaining force to a controlling force”: a bulwark against the overriding power of capital, right at the very heart of the firm. This would require much closer partnership working between business and unions, putting trust, long-termism and shared endeavour at the heart of a new British business model. The labour movement needs to broaden its appeal beyond its declining traditional foundations, taking root in the emerging sharing economy and new forms of work like freelancing.

Understandably, the tense battle over the bill will enflame passions, but the labour movement must be careful not to miss the opportunity to set out a much more radical alternative and provide an inspiring vision of free, democratically-accountable trade unions.

This effort, like so many, will be immeasurably strengthened by working at a grassroots level to campaign for, and indeed to build the alternative that Labour should be proposing in Westminster. A labour movement actively working to establish democratic trade unions in ‘hard to reach’ low-wage private sector work places will be both a more credible political force, and a more powerful force for good in the lives of those it seeks to represent.

Conclusion

Labour’s task might sound Herculean; but in reality there are a relatively small number of things that an opposition needs to do well, once (and if) it has recaptured a more confident sense of its own identity.

In simple terms, Labour will need to mount a critique of the government’s actions based on an understanding of where the Conservatives are politically weak; and to use the government’s own legislative and budgetary programme as a springboard for a new story about how Labour would govern differently. Ideally, the party should support both parts of this work with grassroots campaigns that reflect and establish facts on the ground.

Opportunities to inflict defeats on the Conservatives as and when they come along will of course be tempting. But they should be exploited within this overall discipline of principled opposition; that is, opposition that either delivers better practical outcomes for the people of the country, or builds Labour’s credentials as an alternative government.

Labour has a duty to take the responsibility of opposition seriously, and do the job well. The government has made little secret of the fact that its intention is to use this parliament to cement Labour into a series of choices and attitudes that will alienate it from working people. Its goal is to occupy the centre ground and lock Labour out of power for a generation. If Labour sets out humbly to rebuild its relationships with those people, and through this to shape a vision for a just and democratic economy, it will not only have renewed its sense of purpose; it will also have regained its freedom to act.