A Laboured response

As the fallout of Thursday’s elections starts to fall like poisonous rain upon the Government, we are about to see what happens when a party is trapped between its ideals and reality and tries, with perhaps terminal desperation, to avoid the choices this implies.

In fairness to the Labour Party, there is nothing in the results that offers a clear path forwards. In England it is losing more votes to the Greens but more seats to Reform UK, and in any event has plenty of MPs exposed to either menace who will resist any overt moves to appease the other. In Wales, the nationalist tiger has finally eaten it as it did twenty years ago in Scotland.

I have described Sir Keir Starmer with a quotation borrowed from Sir Francis Urquhart: “he was in the trap and screaming from the moment he took office.” But it describes his party even better. Labour MPs sit amongst the largest and most theoretically powerful Commons majorities their party has ever produced, in political and fiscal circumstances that militate against everything they want to do with office. Runaway revenue expenditures create relentless upward pressure on taxation and borrowing costs without leaving room for capital investment to improve services; public hostility to mass immigration and some of its consequences is getting impossible to ignore.

This poses profound problems for any progressive party. The exam question posed by present circumstances is simple enough: “What does ‘Labour politics’ look like when there isn’t more money to spend?” But they don’t have an answer. Instead, the party has retreated behind the walls of the mind and busies itself dreaming up stairways to heaven.

Most obvious of these is the roiling mutiny against the Prime Minister. That Starmer has his flaws is not in question, but of the most important the rebels have nothing to say. They complain that he has a poor relationship with his MPs and no vision to sell the country. But when asked about his mistakes, the most common answers given are things like means-testing the Winter Fuel Allowance, i.e. one of his few, half-hearted efforts towards controlling the public finances.

The real promise Starmer held out to his supporters in 2024 was simple: that nothing fundamental needed to change, no Rubicons needed fording, that simply putting sensible people in charge would bring back growth, and with it the easy politics of spending, the fireside telling of “Labour stories”. He has failed, but the hope persists, and so now his critics focus on his personal failings, recasting him as the next Boris Johnson in his own narrative.

Karmic? Certainly. But without meaning. Personal and media charisma can certainly help a politician, at the margins. But the millstones of the public finances and the public’s expectations grind exceedingly fine; even Boris Johnson, who possessed charm in near-sorcerous quantities, couldn’t stave off the reckoning forever. Andy Burnham’s personal polling, earned in a job in which he has no responsibility for welfare, or taxation, or immigration, is irrelevant. Put him in charge, and he will be satanically unpopular inside a year, certainly with either his MPs or the voters but probably both.

Beyond that, we have more recherché fantasies. Ben Judah, who is definitely making the most of the media spotlight whilst he has it, has his own theory of the Fix Everything Switch that will save Labour. Can you guess what it is? Would it help if I reminded you he served in the Foreign Office? That’s right, it’s rejoining the European Union.

This idea is deeply appealing to Britain’s political and policy elite for obvious reasons. Brexit was the one big question in the past three decades or more in which they really, truly, didn’t get their own way. It is impossible to overstate how congenial, how convenient it would be if the condition of the country could be blamed on it, and a return to prosperity required only the hard labour of getting the public to admit it was wrong.

It is nonsense, of course. Brexit is now serving for Remain-inclined politicos broadly the same role EU membership played for Brexiteers whilst we were inside: a bogeyman, a locus for displacement activity which allows them to ignore a while longer the brute fact that Britain’s economic and social problems are rooted in British policy and can only be fixed by making painful political choices.

Whatever the marginal impact of Brexit on the economy – and I don’t claim there has been none – the numbers speak for themselves. On the vital metrics of per-capita GDP, productivity, and real-wage growth the British economy has been stagnant since the Crash, a difficult state of affairs to blame on Brexit unless you think the economy is precognisant and curled into a defensive ball ten years before the event. Even before then, one reason the Crash hit so hard was that we had spent much of the Noughties simulating prosperity with cheap household credit and 105% mortgages.

The conditions which made New Labour possible — inheriting a growing, low-tax economy and spending a decade borrowing in easy credit conditions to hike spending — are not coming back. But Judah is quite explicit that this is the dream he’s peddling:

“A higher-growth Brexit is possible. Just not a Labour one. You can cut taxes by slashing public services and slash regulation US-style. But flexible markets and more fossil fuels are incompatible with Angela Rayner’s Employment Rights Act and Ed Miliband’s clean power push.”

But set aside for a moment the bigger question of whether or not it would work — a thing knowable only in the event that it actually happens — would a pivot to rejoin be good short-term politics? Well, no. It might have been, in a different world where Labour’s political coalition was different and subject to different threats; where the pivot could be executed cleanly, and have united the Labour Party behind it.

The world we actually live in, though, is not that world. After the last election 89 Labour MPs have a Reform candidate in second place; many more are seeing their local government machine washed away in the teal tide and will conclude, quite reasonably, that Reform overtaking them from third or lower is now a live possibility. But those 89 are, on their own, enough to wipe out the Government’s majority in the House of Commons.

Perhaps the Prime Minister could still push something through with the assistance of the Liberal Democrats, Greens, and sundry nationalists. Yet that is a very different and much more fraught political proposition in itself, and would essentially transform his majority government into a minority one for all practical purposes. Making “rejoin” a live question would also focus media attention on the EU’s negotiating position — no second set of special terms for Britain — and galvanise and unite a fractured Right.

Most importantly, all this would consume the totality of the Government’s political bandwidth and take place over several years in which the actual condition of the country would keep getting worse. It would look like, because it would be, an enormous distraction, and voters would punish it. The fact is that current sentiments towards the EU are no more about the details of our membership than they were in 2016. Voters are angry, and will focus that anger at the politicians and whatever they’re currently doing.

They’ve tried nothing, and they’re all out of ideas

But displacement is all that Labour, and indeed much of the political class, have left. Need to get people out of asylum hotels? Don’t do anything about the numbers coming here or our obligation to house them, just start buying up private housing and hope that bomb goes off after you leave office. Recognise the need for economic growth? Pass a raft of growth-crushing taxation and employment rights measures and then hope the EU fixes it. Public hates the condition of the country? Put a more charming face on it.

They’ve tried nothing, and they’re all out of ideas.