Political Commentary: It may look good now for Labour, but wait till 1999

MR TONY BLAIR is not, as someone misleadingly wrote last week, the first leader of the Opposition to be regarded as more important and interesting than the Prime Minister. But he is the first since Harold Wilson in 1963-64. Mr Blair, like Lord Wilson, somehow contrives the impression that life will be not only better but different when he comes to power. His two immediate predecessors suggested a reversion to the 1970s or even the 1960s - certainly to a time before Lady Thatcher.

Lord Wilson, in private the most conservative, even reactionary of people, told us that the future belonged to men who had a set of coloured pens in their breast pockets. He was perfectly sincere in his views. He believed that an entire group of engineers and technicians had been shamefully depreciated by society. He was much influenced by the experience of his father, an industrial chemist, who had been unemployed.

The younger Wilson was an economic statistician who went on about science. Mr Blair is a barrister who goes on about economics. Mr Gordon Brown is an historian who does the same, at even greater length. Mr Brown, the product of

a Scottish education, used to be able to speak and write perfectly decent English. His performance at the economic seminar last week suggested a man fallen among Americans.

One of them, a small chap with a beard by the name of Reich, kept popping up on a television screen. I first thought he was the alleged discoverer of the female orgasm (a phenomenon, by the way, well understood in ancient times, as it was by the poets of the 17th century). Instead Mr Reich turned out to be the United States Secretary for Labor. What was - what is - he doing, advising the British Labour Party? I should have thought he and his political master had enough troubles of their own as it was, without feeling the need to engage in further interventions.

One does not wish to appear philistine in these matters. This is not a populist column. All trades or professions, from plumbing to the law, have their own special usages, their jargon. Nevertheless, the greatest economists - Adam Smith, Alfred Marshall, Maynard Keynes - have written always lucid, sometimes beautiful prose.

Again, there is nothing wrong with a politician who seeks advice. Lord Callaghan attended classes at Nuffield College, Oxford, before becoming Chancellor, though that did not have the happiest consequences. Our most successful Chancellors since the war, R A Butler and Lord Jenkins, were not economists (though it was sometimes erroneously said of the latter that he was). Nor were they great ones for asking for advice. Altogether Mr Brown sounded like a young man who had been working for an examination, aided not only by American economists but by Aspirins, cold towels and black coffee. He had done enough work - more than enough - to satisfy the examiners. But did he really understand his subject? The answer was doubtful, to say the least.

There is a more serious criticism that can be made of Mr Brown and Mr Blair alike. As Mr Anatole Kaletsky wrote in the Times last week, there was nothing in their remarks to indicate that this country was in an exposed position, with a vulnerable currency. It is a criticism which could with equal justice have been made of Lords Wilson, Callaghan and Healey; of C R Attlee and Stafford Cripps; of Ramsay MacDonald and Philip Snowden.

All were Prime Ministers or Chancellors in Labour governments which were impeded, forced to reverse or, in 1931, destroyed by international finance. In September 1992 a Conservative government was, for the first time in recent history, subjected to the same experience. Mr John Major is still paying the price. The Conservatives will not now be able to say, as they have at every general election I can remember, that Labour is the party of devaluation; though Mr Jeremy Hanley is certainly capable of having a try.

There seems to be an iron law of Labour politics that the crisis starts within two years of the election. Thus the 1931 crisis followed the 1929 election; the 1947-49 crisis, 1945; the 1966-67 crisis, 1964; and the 1976 crisis, 1974. We may confidently look forward to Mr Blair's crisis in 1998-99.

Labour theoreticians have proved themselves largely uninterested in what is, after all, the central experience of every Labour government of this century, except MacDonald's minority administration of 1924, which was instead brought down within months by the withdrawal of Liberal support following a factitious legal scandal. Anthony Crosland wrote airily at the start of The Future of Socialism that he proposed to treat this country as a 'closed' economic system. If it is nothing of the kind, why pretend that it is? Mr Peter Shore, though he may not have written a big book of socialist theory, has at least proposed some remedies, to do with import and exchange controls and generally carrying out a 'fortress Britain' policy.

These remedies would now be even more ineffective than in the days of the sterling area, when the pound was a heavier international currency than it is today. They would be so not primarily because of our membership of the European Union but because of technology. When millions of pounds can be shifted around the globe at the press of a button, with no intervention or supervision from government official or national bank, it becomes meaningless to talk of exchange controls. The only other Labour politician who, apart from Lord Callaghan, has shown any interest in these matters is Mr Bryan Gould. And he, alas, has taken his bat home all the way to New Zealand in an understandable sulk.

What is irritating about the Labour Party is the ignorant response along these lines: 'Our people are not interested in high-falutin' questions of international finance. What they want are decent schools . . . better housing . . . more hospitals . . . full employment . . . a fairer society . . .' Yes indeed. And yet, not once but four times the attainment of these happy objectives has been frustrated comprehensively by a financial crisis. There is, of course, one way of avoiding one; though other crises might come about instead. That is to embrace a single European currency.

I doubt whether Mr Brown or Mr Blair will say anything along these lines or even address the problem at all in Blackpool this week. Mr Blair has so far worked wonders - changed the political weather - by saying as little as possible. There is a good deal in favour of this approach. Charles de Gaulle adopted it to excellent effect, confining himself to the odd television broadcast and occasional press conferences at the Elysee Palace. This approach is closed to Mr Blair, at any rate for the moment. He will have to appear both clever and disobliging at Prime Minister's Questions. It may be that he will equal Lord Wilson's performance. But all the brilliance in the world at Questions did not prevent the July measures of 1966, the devaluation of 1967 or the International Monetary Fund's successful invasion of 1976.