Investment, jobs, growth must be Labour’s policy, not austerity

Miliband Hope imageLabour has had a successful party conference, Ed Miliband made a powerful speech with a strong commanding narrative of Labour’s objectives for government, but the only let-down was in the crucial area of economic policy.

Ed Balls’ embrace of the the right-wing Tory orthodoxy of prolonged austerity until at least 2020 is as unbelievable as it is indefensible. He clearly must believe that the voters don’t trust Labour because it’s profligate so we must at all costs prove to the electorate that we’re fiscally sound and hence be at least as tough as Osborne in pursuing austerity to cut the deficit. But the record shows that Labour has not been reckless with public expenditure.

The last Labour Government’s biggest deficit in the pre-crash years was 3% of GDP, yet the Thatcher-Major governments ran deficits bigger than this in 10 or their 18 years. So who was the more profligate? But anyway from my personal experience what disgruntled voters complain about isn’t that Labour is profligate, but rather: why should I vote for Labour when it’s no different from the Tories in pursuing endless spending cuts? – exactly what Ed Balls is committing to. Continue reading