Labour strategy: time to set out your stall, Mr Miliband | Observer editorial

He has the one nation banner, but does he have the policy content, competence and credibility?

With a deficit-reduction strategy growing more tattered by the day, criticism from the IMF, unemployment figures climbing alarmingly and possibly even more depressing borrowing and GDP figures to come this week, George Osborne's credibility is taking a battering. And yet, such are the paradoxes of politics, it is the travails of the Labour leader, Ed Miliband, again doing poorly in the polls, which have been given far greater attention recently.

Last week, the death of Baroness Thatcher triggered a fresh assessment of the essence of Thatcherism. For all its negative and deeply damaging aspects, and there are plenty, the reappraisal reminded us that any profound economic, cultural and political resculpting of society requires drive, energy, coherence, vision and, essentially, a simple and compelling story told well by a man or woman in whom a sufficient number of voters have trust. Furthermore, that story has to be told when the nation senses that the prevailing settlement is no longer fit for purpose. That synchronicity happened in 1979 for Thatcher. It occurred again in 1997 for Tony Blair and New Labour.

The growing anxiety emanating from different wings of the Labour party is whether it is possible in 2015 under Ed Miliband. He has the one nation banner; he talks of "two different visions of our economy". He can cite a growing number of non-partisan eminent economists who say that the current deficit-reduction strategy isn't working – evidenced in falling wages, rising living costs, low growth and an accelerating race to the deregulatory bottom, but does he have the policy content, competence and credibility to convey a narrative that convinces? Is he building a compelling picture of what a Milibandist society might look like or is the party's perpetual cycle of policy reviews revealing a dangerous lack of confidence and absence of unity in what it truly believes?

Of course, to reveal the colour of a manifesto two years before a general election is tactical madness, not least because the issue then becomes Labour's spending and how it does or doesn't add up, rather than the coalition's record in government – always the key issue. That said, it still leaves room now for Miliband to demonstrate a greater energy and urgency. He could more clearly prioritise those two or three "big" ambitious ideas, and how they will be funded, so they become emblematic of his greater endeavour. They then stand as signposts that indicate a significant change to the shape, values and rewards of a Miliband society. If the timing and tenor of that message are right, voters may instinctively respond, so why isn't that process more clearly underway?

A simple if cynical response is that there is no pressing need. If winning is the only goal, then, according to what's been labelled "the 35% theory", if Labour retains its 29% core vote and harvests a further 6% from defecting Lib-Dem votes it can scrape past the post. However, the potentially exhilarating and welcome aspect of what Ed Miliband and his core colleagues offer is the prospect of a new social compact, replacing what Stewart Wood at a one nation conference last Thursday called "the exhaustion of the old settlement". A compact that doesn't rapidly crumble to the touch, as the policies of François Hollande appear to have done, but instead provides a programme of root-and-branch change that, as Geoff Mulgan writes in The Locust and The Bee, recalibrates capitalism so it becomes "more of a servant and less of a master".

Earlier this month, Tony Blair warned of the dangers of Labour reverting to the party of protest while attempting to shift the centre ground to the left: the vote of the squeezed middle is still crucial to electoral success. Miliband has to convince this essentially conservative group that since neoliberal "trickle down" economics has failed miserably, an alternative is not so much leftwing, as functional – what works best for the majority, not the few.

However, his vision remains blurred. There are policies aplenty but the issue is how they hang together and whether Miliband possesses the strategic skills and has sufficient supporters, including among the Blairites and trade unions, as well as the personal lustre to deliver at a price the electorate is willing to pay.

On Friday, it briefly looked as if Her Majesty's opposition had decided to take an uncharacteristically early gamble in the long run-up to the 2015 election. Shadow cabinet ministers were reported to be debating whether to jettison the Osborne deficit straitjacket and promise an extensive programme of investment in housing and public services. That announcement may still come but only after the coalition has set out its own spending plans for the financial year 2015/16. Ditching the austerity approach is a risky but bold step that would certainly establish a major Miliband milestone on a journey in which he has already achieved creditable advances.

The whispers of a leadership coup are no more. The doubts over what some see as Miliband's lack of presentational skills and "wonkiness" have, in part, been stilled by his flashes of courage and intuitive accord with the public mood – on Libor, on predatory capitalism, on Murdoch. Now comes the hard part. What is the story he is trying to tell – and how skilfully can he navigate the massive roadblocks that others, not least on his own side, are putting in his way?

Among the policies proposed so far are incentives via, for instance, procurement, to encourage employers to pay fair wages and reduce the working tax credit bill; a technical baccalaureate to boost vocational training; a mansion tax on houses worth more than £2m to fund a 10p starting rate of tax; restrictions on energy suppliers; the creation of regional banks; more support for small businesses and a contributory principle in benefits.

Also on the list are tighter regulation of private landlords, restrictions on low-skilled immigration and the drive to a high-skills economy and greater equality "baked in, not bolted on". Education is absent as Gove rules unchallenged; hopefully we will soon have detailed policy on integrating health and social care and social infrastructure investment in, for instance, providing free universal childcare. The eye-catching, spirit-lifting, innovative change of direction that definitively "brands" a leader is proving elusive.

The danger for Miliband is that as time slips by, and more and more families suffer the cuts, this extended, introverted Labour party policy reviewing will look less and less appealing set against the template of a woman who knew her mind. Consultation has its place, but so does the Miliband instinct.


The GuardianTramp

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