Starmer to focus now on economy - GulfToday

Starmer to focus now on economy

John Rentoul

@JohnRentoul

Chief Political Commentator, The Independent; visiting professor, King's College, London.

Chief Political Commentator, The Independent; visiting professor, King's College, London.

Starmer may find easier to unite Labour Party

Keir Starmer

Keir Starmer has completed stage one. “We have established ourselves as an effective opposition,” he said in an interview this morning. That is not as easy as it looks, as Neil Kinnock, William Hague, Iain Duncan Smith, Michael Howard and Ed Miliband will confirm.

Yet the next stage is even harder, especially when coming back from such a low position as Labour’s in the 2019 election. The most telling part of Starmer’s interview in The Times is this: “Have we got a long way to travel? You bet.”

Now he is being urged to come up with some policies. Indeed, The Guardian reports that he is planning a “major policy blitz”. The Labour leader is to make a big speech on Thursday that will kick off a transition to a more combative approach, according to Labour sources. I suspect that if Starmer could identify the sources he would tell them that a period of silence on their part would be welcome. He knows that the last thing he needs to do is to set out a lot of policy.

There is no sign in the Times interview that Starmer intends to make such an obvious mistake. “At this stage, Starmer is reluctant to discuss specific policies,” The Times reports. “That, he says, will be for closer to the general election.”

He knows full well that the Conservatives have left him little room to set out an alternative. Indeed, it seems odd that Starmer’s speech on Thursday will be on the economy — the one subject on which the opposition has almost nothing to say. I suspect he is making the speech because he knows, as I pointed out yesterday, that he will be responding to Rishi Sunak’s Budget on 4 March — by convention it is the leader of the opposition, rather than the shadow chancellor, who replies to the statement. Starmer’s problem is that he agrees with everything that Sunak is doing; he just wants him to do more of it. Starmer can attract some attention for saying that now is not the time to raise taxes, but that is the overwhelming consensus among economists: it is not wise to raise taxes at the bottom of a recession, just as the blood is beginning to return to the frozen limbs of the economy.

There may be a difference of tone rather than substance between Starmer and Sunak on this. Sunak has already started to push up some taxes — notably council tax — but this is a token offsetting of the great crisis giveaway. The chancellor may well talk of tax rises, and he may even announce some in the Budget, but they won’t take effect for some time.

He wants to reassure the markets that he worries, just as they do, about for how long such high levels of borrowing can be sustained, even if they are justified for the moment. But in his interview today, Starmer says the same: “In the short term, you don’t balance the books and you don’t choke off the recovery by raising taxes.” In other words, in the long term, once you “get your economy to thrive”, you do balance the books by raising taxes.  

Indeed, as Starmer surveys the vista ahead of him, all he can see is the Conservative Party’s tanks parked on the parts he thought he owned. If the economy does badly because of Brexit, he cannot say so because that would instantly turn into a debate about when he wants to rejoin the EU. (In the “quickfire” section of the Times interview, offered a choice between Michael Gove and Michel Barnier, he said “Barnier”, when the correct answer was “neither”.) But in fact what is likely to happen is that the economy will surge over the next two years. There is pent-up demand, as Andy Haldane, chief economist at the Bank of England, pointed out this week.

Many people have saved money over the last year; it is earning negative real interest and they will want to spend it on socialising, holidays and property as soon as they are able. By the end of this year, how to “get your economy to thrive” may not be the right question for the opposition to be asking.

Starmer says his speech will set out a “fork in the road”, a choice between a return to the “broken system” of austerity with the Tories and a “better future” with Labour. But Boris Johnson and Rishi Sunak are just as allergic to the word “austerity” as he is. The fork in the road turns out to be a twin track, stretching as far as the eye can see, with the Tories hogging the road.

In his interview, Starmer speaks grandly of turning points in history when Labour renewed the country. “Out of the rubble of the war you build a better future,” he says of 1945. “Wilson did it with the white heat of technology and Blair did it in ’97,” and now it is his turn. “Out of the sacrifice and solidarity of the last year or so, you build a better future.”

His problem is that Clement Attlee, Harold Wilson and Tony Blair faced a Tory party that seemed stuck in the past. Johnson and Sunak have presented themselves as a new party that came into power just 15 months ago, and they will not easily allow Starmer to usurp their slogan: “Build back better.”

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