Magazine article Public Finance

Where's the Beef?

Magazine article Public Finance

Where's the Beef?

Article excerpt

'Back to basics' didn't work for John Major, but it could just work for Gordon Brown.

Alas, he shows few signs of understanding this. The belief that 'defiance' of trade union 'demands' is essential to the success of a centreLeft party is still deeply encoded in New Labour's DNA.

So, in the language of last Monday's Times front page, a 'weakened' Brown emerged from last weekend's policy forum at Warwick University, 'caving in' to the unions and sending 'shudders through the business community'.

If that's how the press interprets it, Brown and his allies have only themselves to blame. They have done nothing to challenge the view, put about by the more extreme Blairites, that concessions to union proposals threaten a return to the 1980s.

All that was agreed at Warwick were a few vague proposals to build more social housing, enhance rights to seek flexible working, increase opportunities for unpaid parental leave, improve redundancy pay, extend the minimum wage to 21-yearolds, and so on.

These were coupled with some drearily familiar ideas about getting tougher on cannabis offenders and antisocial behaviour. The red meat of the unions' shopping list - a windfall tax on energy companies, a higher top rate of tax, nationalisation of train operating companies and free school meals for all children of primary age, for example - was predictably rejected.

Yet it is precisely this kind of full-blooded programme - expressing the basic beliefs of social democracy that Brown needs if he is to mitigate the scale of Labour's impending general election defeat, never mind think of victory.

Is anyone seriously suggesting that a windfall tax, railway nationalisation and free school meals would be unpopular? Does Brown think city academies, the expansion of which was also agreed at Warwick, have people dancing in the streets?

The prime minister's problem is that he is still fighting the 1997 general election, trying to convince voters that Labour has embraced the free market.

The argument has moved on. The credit crunch has revealed how markets can malfunction. If the state's failure was the story of the 1980s and 1990s, the market's failure will be today's story.

The opportunities of globalisation have become less evident than the risks. Inequality isn't a subject just for the Guardian. As the top 10% race away from the other 90%, the top 1% race even further ahead and the top 0.1% of the super-rich obsess the Mail and the Telegraph further still.

Social welfare is not just for the lazy, the feckless and the stupid; as hard times approach, anyone might need a safety net. …

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