Ed Miliband is fighting for his political life; not with the electorate, nor even with his Labour Party colleagues in Parliament, but with his erstwhile trade union backers. It is a battle that must be won if either he or his party is to stand a chance of winning a general election.

The opening salvo came from Len McCluskey. The general secretary of the Unite union has attacked the shadow Chancellor's admission that, given the economic circumstances, he cannot promise to reverse the Coalition's freeze on public sector pay. Mr McCluskey characterises Ed Balls's position – which has the public endorsement of Mr Miliband – as "discredited Blairism", and maintains that it is paving the way for the destruction of the Labour Party and certain general election defeat. Strong stuff indeed.

On the specifics of public-sector pay, Mr McCluskey's arguments show a failure to understand either economic or political realities. More worryingly for the Labour leadership, his invective amounts to a call to arms. Indeed, the recommendation that Mr Miliband's ideological opponents "get organised" both inside and outside Parliament can only be interpreted as a threat.

Ostensibly, such attacks come at a bad time for the embattled Labour leader. There is no question that the Opposition is doing worse in the polls than it should be, given the ever-worsening economic outlook and the bite of government spending cuts. Mr Miliband is at least partly to blame: despite some early successes – on phone hacking, for example – he has struggled to establish himself as a credible leader and failed to head off Coalition claims that the previous Labour government can be blamed for Britain's parlous economic state.

The result is a leader increasingly characterised as a dead duck, a geek who is too much of a policy wonk and too little of a showman to be successful. Possibly. Possibly not. In truth, it is too soon to tell. Mr Miliband's attempts to bat away the criticism as "part of the gig" have more than a shred of truth in them. His acknowledgement, in last week's largely underwhelming re-positioning speech, that there will be less government money to spend may help, notwithstanding the fact that it was far too long coming. But, as much as anything, it is Mr Miliband's response to the challenge from the trade unions upon which he will stand or fall.

There is a clear message from the polls, if only the Labour rank and file will hear it. The Coalition may be banging the drum too hard in claiming that Labour profligacy caused the financial crisis. But there is no question that the legacy of overblown public debt has made the recovery harder, which only confirms perennial suspicion about Labour's economic incompetence.

Unless Mr Miliband can address such concerns, his party stands little hope of forming a government. And while Old Labour stalwarts may characterise his change of direction as a betrayal, replacing him with another leader, one who would not drag the party to the centre ground, would only relegate the party to the electoral wilderness.

The outcome is far from settled. So far, Mr Miliband is talking tough, rejecting the criticism and rightly stressing the difficult choices that such cash-strapped times demand. He also has the beginnings of decent form. Despite relying on union support for his leadership victory, he has made moves to dilute their voting power and also refused to endorse November's mass strike.

Ironically, Mr McCluskey's challenge may be just the opportunity Mr Miliband needs. Staring down the unions could lay the ghost of "Red Ed" and at least start to assuage concerns about Labour's economic credibility. It is a fight in which he deserves full support.