Monday, 24 March 2008

Labour loses ground in the killing fields

To Labour's high command they are known as the killing fields. They are in London, along the M4 corridor, the north Kent coast, the south coast and the M11 corridor. They include lots of C1 (junior non-manual) and C2 voters (skilled manual). They are the voters who turned to Mrs Thatcher in 1979 and to Tony Blair in 1997.

Now Lord (Giles) Radice who wrote a famous pamphlet on southern discomfort in 1992 is warning that it is emerging in a new and more complex form. New Labour needs to win back families who have been hit by high interest rates, are concerned that taxes are not being wisely spent, and are worried by immigration and crime.

This crisis has sparked an ideological debate within New Labour. The left believes that Gordon Brown is siding with the Blairite modernisers. A fresh set of advisers have been brought into No.10 from the media, advertising and banking. His chief adviser, Stephen Carter, is portrayed by left opponents as the head of a 'Lib Dem cell' in Downing Street. Jennifer Moses, an American former Goldman Sachs banker who didn't notice when £1m went missing from her bank account worked for a Lib Dem-oriented think tank.

The modernisers want Gordon Brown to speed up public service reform and to address the perception that his government is uneasy with wealth and aspiration. Aspiration was used as an organising theme in the Queen's Speech, but events since then have served to undermine its resonance. Reforms to capital gains tax and action on non-doms affected few voters, but could be portrayed as anti-wealth and anti-enterprise.

Critics on the left say that the core vote is being neglected, while Hazel Blears has insisted that Labour has to be a party of the affluent as well as of the poor. In reality, Gordon Brown may welcome a row with the Labour left. He was as much a part of the New Labour project as Tony Blair and the ideological differences between them were very slim. But it suited him to play up the differences in the succession battle. There were big personality differences, of course, but the prime minister is less dour and more engaging on a one to one basis than he appears in public. He is very good at getting the information and ideas he needs out of someone very quickly.

Before the narrative of a foregone conclusion to the next election is pushed too far (notwithstanding Labour's very real southern vulnerability) it should be remembered that Dave Cameron is unlikely to be able to deliver much in the way of tax cuts. Indeed, shadow chief secretary Phil Hammond has warned that tax cuts could be the 'the great bonus of the second election'.

In 1979 James Callaghan, as a former naval NCO, noted that there was one of those great sea changes in British politics that produced Thatcherism. Another sea change in the mid 1990s led to the 'third way' of Tony Blair with its mix of social democracy and neo-liberalism tilted towards the latter. Another sea change could now be on the way, but the currents are more conflicting and turbulent than they appear on the surface.


Justin Greaves said...

Being back with my parents for the week (in many ways typical middle class voters who were attracted to Thatcher in the 80s but then moved against the Tories in the 1990's), I am aware that two of the biggest issues to them are inflation and tax. There is a perception that inflation is much higher than the official figures. Although I am willing to accept that the RPI figure including housing costs (which is I think around 4%) is probably a more accurate reflection of inflation than the CPI, my parents are convinced it is running at 10% plus! (eg: higher council tax, utility bills etc). This, along with a rising tax burden (I think Labour have reached the limits of what is 'politically acceptable' regarding tax levels in Britain), could cause real problems for Labour in the South.

I suspect a hugh parliament is the most likely outcome of the next election. Certainly, I can see the Tories moving ahead of Labour in terms of the popular vote but it is difficult to predict how that will feed into seats in parliament, not least because of the pro-Labour bias of the electoral system.

Wyn Grant said...

This is a well known phenomenon because people focus on small ticket/everyday items and ignore things like second hand car prices which have been tending to fall. The composition of both indices is in the public domain and I do not think that the statisticians concerned would engage in any deception. I would agree that RPI is a more accurate reflection of inflation as it is experienced by voters. It was clear in the second term that New Labour had a revealed preference for higher taxation and they may have gone beyond the limit of what is politically acceptable.

There has been quie substantial redistricting and creation of new constituencies since the last election, e.g., the creation of the new Kenilworth and Southam constituency in Warwickshire. How this will play out is a complex matter but arguably the pro-Labour bias has been reduced. A key variable is turnout and it could be low, although a very close contest could boost it.