The People Who Lie to Themselves
The Dishonesty at the Heart of Keir Starmer’s Labour
THAT THE Conservatives are political toast is now a truism of British politics. It seems everything Rushi Sunak touches turns to blight. With his increasingly wan smile, the Prime Minister frequently gives the impression of simply going through the motions, as though he himself no longer believes in the bizarre concoction of austerity economics and crude populism that has characterised his rudderless premiership. The latest scandal of aerated concrete threatening the physical collapse of schools and hospitals symbolises Tory Britain: after well over 13 years of ruinous Conservative rule, the country feels like it is literally falling to bits. With electoral projections predicting a Labour majority of anything between 40 and 140 seats at the next General Election, if the government ever did have a “narrow path to victory” as Isaac Levido claimed eight months ago, it now seems overgrown, mountainous and littered with fallen concrete.
With an average opinion poll lead of 18 points, historically unassailable at this stage In the electoral cycle, Keir Starmer’s Labour seem destined for power, possibly as soon as May next year. The party, pursuing an almost carbon copy of the tactics employed by New Labour in 1996/97 have been careful to shut down any conceivable Tory attack line by diluting, postponing and removing most of the headline policies that had made the Labour offer truly distinctive as recently as last year’s Party Conference. There has been much disappointment and complaining on the left at Starmer’s and Reeves’ caution, lack of ambition and even political cowardice at what appears to be a surrendering of any recognisable progressive agenda to the Tory settlement even as that very settlement appears to be in its death throes. The question of what Starmer’s Labour stands for as it gets ever closer to becoming the next government of the U.K. is constantly raised. Whereas I share those concerns, there seems to me to be something far darker at the heart of the Labour project that goes beyond normal electoral calculus: Labour is actually being wilfully or naively dishonest with the British people.
That dishonesty is fiscal, but also political.
Labour’s current fiscal policies are rightly criticised by disappointed supporters as symbolising the government-in-waiting’s lack of political courage, but are rarely taken to task for their lack of economic coherence. In short order, Rachel Reeves has “ruled out” increasing the top rate of income tax; increasing corporation tax above 25%; any increased borrowing for the first two years in government, and any form of wealth tax. Keir Starmer has recently joined the closing down of fiscal options by promising no increase in income tax at all. The Right have traditionally challenged past Labour Party spending plans with the knowing sneer “where’s the money coming from?”. Now that question is one of genuine objective political curiosity: how on earth is Labour going to govern after it has voluntarily committed to raise no new money whatsoever?
It actually gets worse. It seems to have been forgotten (and I sometimes think by Rachel Reeves too) that Jeremy Hunt’s Autumn Statement last year, designed to stabilise the money markets after Liz Truss’ crazed tax cutting experiment, not only launched Tory Austerity 2.0 by keeping public spending below headline inflation, but also committed to reduce current spending by £22bn and capital spending by £14bn in 2025/26. Labour has signed up to the government’s spending plans and therefore has effectively committed itself to public spending cuts in its second year in office. Rachel Reeves’ fiscal rule (public debt to be less than public income by 2029) is of a piece with this.
The Labour response to criticism of its lack of spending plans, in a reprise of Truss’ mantras, is that Labour wishes to grow the economy and that this cannot be achieved by increased taxation. This of course takes as read the tired Tory assertion that all taxation is derived from income and that increased taxation therefore suppresses consumer demand. This sophistry ignores what governments can do to stimulate the economy with increased revenues, from whatever source, and refuses to countenance the reform of taxation of wealth and property. Even if one puts unexplored policy options to one side (including the rebasing of Council Tax) Labour seems to believe that the economy will grow as if by magic; that the very appearance of a Labour government will automatically attract inward investment, stimulate new businesses, fund capital infrastructure projects and increase wages. To the question “How?” the Labour front bench has no answer.
The fact is that Reeves at least, as a former economist at the Bank of England, knows full well that growth does not occur spontaneously. Investment-led growth requires deployment of fiscal actions by the government, whether that is through the tax breaks, quantitative easing, low corporation tax, low interest rates or the selling off of state assets favoured by the Right, or through the stimulus economics, capital infrastructure spend, government-backed lending and job creation initiatives favoured by the Left. Growth always requires decisive action by the Treasury. To pretend otherwise is either delusional, economically illiterate or, that word again, dishonest.
Starmer and his front bench, given their relentless and highly effective, critique of modern Toryism, also understand that the series of policy disasters inflicted by successive Conservative regimes - the social vandalism of austerity; the self harm of Brexit; the magical thinking of Trussonomics and the inadequate neo-Thatcherism of the hapless Sunak - has resulted in untold damage to the fabric of the British economy, to the resilience and adequacy of public services and to people’s standards of living. Labour know that the unprecedented ruin wrought by the various Tory iterations can’t be “fixed” by a little policy tinkering, some structural reform and fiscal conservatism. To imply otherwise is beyond dishonesty; it is a lie.
Politically, the public’s disgust with the Tories is real. The inchoate anti-austerity that could be detected in the Brexit vote, and even in the vote for Boris Johnson’s offer in 2019, is real. However, unlike its response to those choices, this time the public refuses to be gaslighted by the right wing media. Voters have accurately joined up the dots between Cameron’s “debt reduction” falsehoods of 2010 and the lived reality today of a collapsing NHS and crumbling classrooms. The public not unreasonably want ambulances to turn up, police to manage low level crime, their councils to have enough money to regenerate their town centres, for the unaccountable water companies to stop spewing sewage into the nation’s waterways, for trains to run on time, waiting lists to come down, courts to function and public buildings not to collapse. The Labour critique has done its job, but the opposition’s implication that these public expectations can be met solely by growth and “reform” and no restitution of the public spending cuts implemented by the Tories, is fundamentally and politically dishonest.
In truth, Labour once in office, will live its dishonesty. Perhaps, like Starmer’s cheerleaders earnestly hope, the new government will reverse all its commitments not to increase existing or introduce new taxes, drop Reeves’ fiscal rule and its proclaimed adherence to the 2022 Tory financial settlement, and set about raising revenue in order to stimulate the growth it claims it wants. Or perhaps it will militantly keep its financial word but achieve no meaningful change and let down the millions of voters Labour had encouraged to turn to it to reverse the destruction of the Tory years. There is no way out of this bind - Labour will be unable to avoid the charge of dishonesty whatever it does, or chooses not to do. Starmer and his team may be able lie to themselves in opposition, but as the Tories have discovered to their cost, you can’t lie to the electorate when in government and hope, for any length of time, to get away with it.