The Eds can work it out and get it straight, or say good night

If Miliband and Balls cannot stop pulling in opposite directions and agree a united front, Cameron is going to be the next election victor

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As the Prime Minister's reshuffle disappears into chaos and recrimination, now is the time to turn our attention to the Opposition. Despite Labour's average nine-point lead in the opinion polls over the past six months, the party is uneasy. It is an unease that goes right to the top. Two weeks ago, I wrote here that the Labour leader and the shadow Chancellor had been getting on particularly badly, and suggested that their disunity might be more important over the next three years than any differences between David Cameron and George Osborne.

Since then, reports, which have not been denied, have identified policy on banking as one source of disagreement between Ed Miliband and Ed Balls, with Balls more concerned to preserve the City of London's global advantage in financial services. These reports were adorned with anonymous quotations from Miliband supporters accusing Balls of "displays of alpha-male posturing" and of "being high-maintenance".

They were hardly the most wounding insults, and some of the follow-up reporting was a case study to include in that book I am never going to write called "How Journalism Works". The Daily Mail carried a full-page report on "the Ed to Ed feud" last weekend that opened with a striking anecdote about Miliband's breaking off as he spoke to the shadow cabinet to reproach Balls, who was texting. "Ed, people can be just as interesting as BlackBerrys," he told his shadow Chancellor.

This looked like a new story, but it was recycled from Kevin Maguire's column in the New Statesman 18 months ago, in which Miliband said: "I know BlackBerrys are interesting, but so are people." In Maguire's account, "moments later [Balls] was tapping his phone again", and Maguire commented: "Sounds to me like an authority issue." It caused hardly a ripple at the time, which shows the importance of timing. Now that tensions between the Eds are "a story", the Mail is interested.

The "Ed to Ed feud" is a story now, however, because everyone at the top of the Labour Party knows that it is true, although they disagree about its intensity; and journalists, who had been aware of it as a grumbling noise in the background, are beginning to realise that it is important. Which is why the two Eds spent an hour and a half on each of the three days after they returned from holiday last weekend talking to each other about the united front they were going to present in the new political term. And why they sat next to each other in the Commons last week, chatting animatedly – with Balls refraining from his usual sledging of Cameron, which irritates Miliband because it distracts from him.

They are both, undoubtedly, determined to make the relationship work. "We have seen that movie before and had front-row seats," Miliband said, when he reluctantly appointed Balls shadow Chancellor nearly two years ago. "We are determined there will be no sequel. It was a formative experience for both of us. It is something we are absolutely determined to avoid and we will avoid."

Well, the sequel has begun already, although we do not know how it will end this time. Discussions have been civil this week, but there have been (polite) tensions about Labour's conference, in Manchester at the end of the month. I understand Balls thought the conference theme should be how right he had been on the economy, while Miliband thought that it should not be, but did not propose a clear alternative.

Let us, then, consider the possible endings to this movie. The happy-ever-after scenario was hinted at by Balls in his interview with Andrew Grice and Steve Richards in The Independent last week. I got the impression that he and Miliband have agreed the basic position on tax and spending for the next election.

Despite Balls's conviction that he called it right in condemning the coalition's cuts as "too far, too fast", he and Miliband are united in accepting the Government's plans, whatever they will be by 2015, with just two exceptions. They want to spend more on the NHS, and cut student tuition fees, both of which would be paid for by an extra tax. They want something that the voters would support, like the windfall tax on the privatised utilities in 1997. The prime candidate is the mansion tax on houses worth more than £2m. If they can make that work, it is possible to see how Cameron could lose the next election.

The less united scenario was hinted at by Miliband in his interview with the New Statesman last week, in which he made "predistribution" the theme of his return to the fray. It is a reasonable subject for a seminar: how to influence the inequality of earnings to reduce the need for benefits and tax credits for the poor. But it is a stupid word for a political campaign.

That kind of nonsense could try the patience of any reasonable person. And Ed Balls, although he is more engaging than his public persona and is making a great effort to get on with his leader, is not a patient person.

twitter.com/@JohnRentoul; independent.co.uk/johnrentoul

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