Labour has let Tories win argument on economy

The Conservatives have been busy trying to recreate the political choices of the 1980s

Share
Related Topics

Despite the pain of cuts and division over Europe, the outcome of the next election is in the balance. The public will decide who to vote for based on which party they think will deliver a stronger economy to pay for a fairer Britain. At present, the jury is out.

“Labour messed up the economy and the Tories are making it worse so why should I vote for either?” one voter asked. “And now that Labour says it won’t reverse the cuts and will spend the same as the Tories, what’s the point of Labour?” another demanded.

The party’s challenge is to provide a compelling case as to why Britain would be better off with Labour. Firstly, the problem is that the electorate doesn’t yet see a clear choice between the parties on cuts vs growth. Secondly, the Tories have been relentless in asserting that Labour messed up the economy.

Not rebutting this charge makes us look like a shamefaced schoolboy admitting responsibility by omission. And if we don’t rebut the accusation, it will simply amplify as the election approaches. 

True, the deficit went up once the sub-prime tsunami hit our shores but it was Gordon Brown’s and Barack Obama’s fiscal stimulus that ensured a mild recession in 2008-09 instead of a depression and meant GDP was growing again by 2010.

Only a third of the 2010 deficit was due to Labour investing above earnings to keep the economy moving forward, with two-thirds caused by the bankers. In a downturn, that is the correct economic strategy. To cut in a downturn makes things worse but that is exactly what the Coalition has done.

In his 2010 Budget, George Osborne announced 500,000 job cuts in the public sector, which ensured public-sector workers started saving instead of spending in case they lost their jobs. The switch from growth to cuts will mean the debt to GDP ratio will grow from 55 per cent in 2010 to 85 per cent by 2015.

The Tories are cutting deepest in the North and Wales – where there are more public servants – and spending most in London and the South-east – where there are more Tory voters.

Meanwhile, the poor who spend all their money by necessity and help the local economy are being hit hardest to pay for the bankers’ folly.

Labour needs to set out a vision of a stronger Britain that provides the economic confidence to invest and consume to stimulate jobs and growth. The Conservatives have been busy trying to recreate the political choices of the 1980s – between an “all heart and no mind” Labour which would tax and spend Britain into bankruptcy vs the hard-nosed business sense of the Tories making tough choices in the nation’s interests.

Labour needs to talk the talk of UK plc – boosting the UK’s productive capacity by linking industry, universities and councils. We need a sharper focus on the growing export opportunities to China, India, Brazil and Russia. We must invest in homes and transport, use public procurement as an engine to grow small and medium-sized firms.

The European elections next year are an opportunity to put growth and jobs centre stage. The central question is the cost to trade, investment and jobs of spending four years arguing about whether to walk away from Europe. Inward investors from growing economies want access to the world’s biggest market – Europe – and not to pay a 14 per cent tariff to export from a detached island. We need to continue a journey towards jobs and growth, not to be diverted into a cul-de-sac of more cuts.

Geraint Davies, MP for Swansea West

React Now

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs General

Reach Volunteering: Financial Trustee and Company Secretary

Voluntary Only - Expenses Reimbursed: Reach Volunteering: A trustee (company d...

Recruitment Genius: Senior Project Manager

£45000 - £65000 per annum: Recruitment Genius: This is a fantastic opportunity...

Recruitment Genius: Shopfitter

Negotiable: Recruitment Genius: This is an opportunity to join a successful an...

Recruitment Genius: Digital Sales Account Manager

£25000 - £30000 per annum: Recruitment Genius: A Digital Sales Account Manager...

Day In a Page

Read Next
 

Note to footballers: doing the right thing is more than a PR job

Simon Barnes
 

The royal dress code can't cloak Prince Charles

Joan Smith
Mau Mau uprising: Kenyans still waiting for justice join class action over Britain's role in the emergency

Kenyans still waiting for justice over Mau Mau uprising

Thousands join class action over Britain's role in the emergency
Isis in Iraq: The trauma of the last six months has overwhelmed the remaining Christians in the country

The last Christians in Iraq

After 2,000 years, a community will try anything – including pretending to convert to Islam – to avoid losing everything, says Patrick Cockburn
Black Friday: Helpful discounts for Christmas shoppers, or cynical marketing by desperate retailers?

Helpful discounts for Christmas shoppers, or cynical marketing by desperate retailers?

Britain braced for Black Friday
Bill Cosby's persona goes from America's dad to date-rape drugs

From America's dad to date-rape drugs

Stories of Bill Cosby's alleged sexual assaults may have circulated widely in Hollywood, but they came as a shock to fans, says Rupert Cornwell
Clare Balding: 'Women's sport is kicking off at last'

Clare Balding: 'Women's sport is kicking off at last'

As fans flock to see England women's Wembley debut against Germany, the TV presenter on an exciting 'sea change'
Oh come, all ye multi-faithful: The Christmas jumper is in fashion, but should you wear your religion on your sleeve?

Oh come, all ye multi-faithful

The Christmas jumper is in fashion, but should you wear your religion on your sleeve?
Dr Charles Heatley: The GP off to do battle in the war against Ebola

The GP off to do battle in the war against Ebola

Dr Charles Heatley on joining the NHS volunteers' team bound for Sierra Leone
Flogging vlogging: First video bloggers conquered YouTube. Now they want us to buy their books

Flogging vlogging

First video bloggers conquered YouTube. Now they want us to buy their books
Saturday Night Live vs The Daily Show: US channels wage comedy star wars

Saturday Night Live vs The Daily Show

US channels wage comedy star wars
When is a wine made in Piedmont not a Piemonte wine? When EU rules make Italian vineyards invisible

When is a wine made in Piedmont not a Piemonte wine?

When EU rules make Italian vineyards invisible
Look what's mushrooming now! Meat-free recipes and food scandals help one growing sector

Look what's mushrooming now!

Meat-free recipes and food scandals help one growing sector
Neil Findlay is more a pink shrimp than a red firebrand

More a pink shrimp than a red firebrand

The vilification of the potential Scottish Labour leader Neil Findlay shows how one-note politics is today, says DJ Taylor
Bill Granger recipes: Tenderstem broccoli omelette; Fried eggs with Mexican-style tomato and chilli sauce; Pan-fried cavolo nero with soft-boiled egg

Oeuf quake

Bill Granger's cracking egg recipes
Terry Venables: Wayne Rooney is roaring again and the world knows that England are back

Terry Venables column

Wayne Rooney is roaring again and the world knows that England are back
Michael Calvin: Abject leadership is allowing football’s age-old sores to fester

Abject leadership is allowing football’s age-old sores to fester

Those at the top are allowing the same issues to go unchallenged, says Michael Calvin