Wednesday, June 11, 2008

More from the FT

Old ideological fault lines have resurfaced by George Parker
June 11 2008 05:09

Before Labour’s crushing defeats in last month’s town hall, London mayoral and Crewe by-elections, cabinet ministers routinely took comfort in the thought that, for all the party’s woes, at least the government was not ideologically split.
This political unity, argued ministers, set Gordon Brown’s faltering administration apart from John Major’s disintegrating government of 1992-97, which was riven by divisions on Europe.

That distinction is no longer so clear. Since the May meltdown, Labour’s old ideological fault lines have re-emerged. Blairite modernisers and the left are promoting their own very different policy solutions to stem the party’s decline – and the FT’s research into recent voting patterns neatly illustrates the backdrop against which this internal battle is being waged.

The left is convinced the route to salvation lies in mobilising the party’s demoralised working class base, through policies including wealth distribution, a focus on poverty, more social housing and windfall taxes on energy companies.

Neal Lawson, of Compass, the leftist pressure group, insisted at a recent meeting to debate the party’s future: “We are not a Conservative country!”

The Blairites want to maintain a broad coalition embracing the aspirations of the middle classes, pushing on with radical reform of public services and pursuing tough policies on crime and immigration and – possibly – tax cuts.

As Hazel Blears, the communities secretary put it, Labour needed to be “the party of the affluent” as well as the poor. John Hutton, business secretary, has told the party to celebrate people who have become extremely wealthy.

The debate is raging in the think-tanks and in the opinion columns of left-leaning publications, but these are still minor tremors. Some Labour figures fear they may herald a political earthquake.

One cabinet minister said the tensions within the party could be contained so long as Mr Brown was leader. “It’s under control because Gordon internalises the ideological tensions.”
Put another way, Mr Brown may instinctively be wedded to the left agenda of tackling poverty, but his policy direction is unclear and is often pure New Labour, including the wider use of the private sector in delivering public services.

While Labour struggles to meet its targets for tackling child poverty, Mr Brown has cut inheritance tax for middle England and abolished the 10p starter rate of tax, helping the middle classes to the detriment of the poor.

“The real ideological battle will happen when Gordon goes,” says the cabinet minister, adding with a smile: “In 10 to 15 years’ time.”

The timing of Mr Brown’s departure could be pivotal in determining what happens next to Labour. Leading MPs on the left concede that at present the modernisers are winning the argument. An early leadership contest would probably see Blairite modernisers such as David Miliband and James Purnell make the running, while there is no obvious flag-carrier for the left apart from Jon Cruddas, a backbencher who fared well in last year’s deputy leadership contest.
But if Mr Brown holds on until the next election, and loses badly, some modernisers fear the tide could start running strongly to the left, leaving Labour washed up and risking falling behind the Liberal Democrats as a third party.

“Under a meltdown scenario the party might start talking about reconnecting with its working class roots, and there would be the rhetoric of betrayal of our supporters,” says one moderniser. “The party would be virtually bankrupt and the trade unions would start to demand more say for their money to keep the party going.”

That is where Labour ended up after the 1979 election defeat to Margaret Thatcher. “If we just concentrate on the core vote, then we are absolutely doomed,” said Shona McIsaac, a Labour backbencher. “We abandon the aspirational working and middle class people at our peril.”

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