In thrall to Thatcher

Labour’s moral authority to attack the coalition’s economic agenda will only come after it has thrown off the Blair inheritance

Over the breakfast table the other day I was reminded how startled I was when the late Leo Abse, former MP for Pontypool, remarked bitterly to me in the mid 1990s, of Tony Blair, “That man has stolen my party.” I was reading Andrew Rawnsley’s column in last Sunday’s Observer and was stunned by his story of how Gordon Brown renamed a room on the first floor of Number 10.

For years it went under the bland identity of the White Room. However, Brown had it renamed the Thatcher Room and ordered a portrait of the lady hung on one of its walls. As Rawnsley remarks, “Gordon Brown had the room renamed in honour of the Conservative prime minister who had pulverised the trade unions, privatised the industries, sold off council houses, squeezed the state and routed the Labour Party.”

I read this out to my partner across the table, a lapsed Labour Party member, who responded, “You of all people shouldn’t believe everything you read in the newspapers.” But, I protested, “You couldn’t make that up, could you?”

As we peer into next week’s Comprehensive Spending Review announcement and the misery of the spending regime that will follow, this story tells us why there is no serious opposition narrative to the cuts, which are now more or less accepted as a given across the London parties and most of the press and media.

A major problem is that a lot of commentators and politicians confuse the debt with the deficit. The fact of the matter is that by historical standards Britain’s public debt is not all that high. At the end of World War II it was around 250 per cent of GDP. Even at the end of the 1950s it was still 150 per cent. When Labour came into office it was down to 40 per cent, and now has gone up to somewhere between 40 and 50 per cent.

The annual deficit, in contrast, is currently standing at 11 per cent and we do need to bring it down, but we shouldn’t be too precipitating about it. About half the deficit is being caused by the recession and the drop in output. The other half is structural and that’s what we need to tackle. But the danger is that in doing that we will prolong the recession and increase the proportion of the deficit it is causing.

The reality is that even if we reduce the annual deficit from 11 per cent to zero in five years, which is the coalition government’s apparent intention, Britain’s overall debt ratio to GDP will still rise to somewhere around 80 per cent. If we did nothing it would rise to around 100 per cent. So given that all this is being driven by Britain’s need to assuage the markets and keep interest rates down, surely there is some room to manoeuvre. As the First Ministers of Wales, Scotland and Northern Ireland put it in their joint missive to David Cameron and George Osborne last week, your cuts are “too fast and too deep” and are putting economic recovery at risk.

The trouble is, as the story about Brown being in thrall to Margaret Thatcher makes evident, the opposition has little moral authority to make this case. Of course, Gordon Brown didn’t start it, but he allowed himself to be corrupted into idealising the Thatcher inheritance. Remember how shortly after he became Prime Minister, Brown was photographed with the lady on the steps of Number 10.

Of course, her presence had been well established under Blair. A reminder is provided in the book published by Blair’s Chief of staff, Jonathan Powell yesterday, The New Machiavelli: How to Wield Power in the Modern World. In it he talks about how Blair agonised about sending troops into battle, waking up in the middle of the night in a cold sweat.  “In the run-up to Kosovo, Tony spoke to Mrs Thatcher on the phone and then a few days later asked me to invite her in to talk to him about deploying troops. She too had been in the lonely position of having to decide on war. I took her to the flat. She told me on the way up that my job must be very exciting. Her advice to Tony was not to try to fight a war through a committee.”

Leo Abse’s comment to me was prompted by a discussion we were having about the forthcoming publication of his psycho-biography of Blair, The man behind the smile: Tony Blair and the politics of perversion, published in 1996. In it he says, “A Labour Party denying its socialism and unashamedly stealing Tory clothes in order to appear inoffensive to all, may claim respectability but, in fact, becomes a strumpet of a party.” Of the subject himself, Abse wrote, “As actor or performer doubtless Blair brought pleasure: his small step from stage to political platform in search of identity may have assisted him in his personal resolution, but it left my Labour Party shorn; he has taken away the identity of the Labour Party and reshaped it to suit his own psychological measurements. This operation is described by his supporters as ‘reform’: I call it theft.”

Until Labour recovers its pre-Blair identity and forges a social democratic project fit for the 21st Century it will have little chance of finding the moral resources to mount a credible assault on the present government’s dangerous economic policy. An encouraging note to end on is that under Ed Miliband, who started out by renouncing New Labour’s most heinous tendencies, in particular its warmongering instinct, at least it has a chance of doing so.

John Osmond is Director of the IWA.

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