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Editorial Ending Stagnation? Starmer's Labour has turned its back on every policy required

THE Resolution Foundation’s Ending Stagnation report sets a political challenge which Labour fails badly.

Keir Starmer’s address to the foundation’s conference shows he is clueless about the scale of the country’s problems and sets his face against all the policies required to address them.

The reason is political. There are two narratives about the radical politics that swept the country from 2015-17: one prominent at the time was that Westminster had finally caught up with the political consequences of the bankers’ crash of 2008, and recognised a change of direction was urgently needed.

But the Establishment crushed the Corbyn project and the second narrative, that this was an outburst of collective madness which needs to be buried, has taken hold. 

Starmer’s programme is to remove every vestige of “Corbynism” from Labour’s prospectus: the result is a studied conservatism on both foreign and domestic policy, tying the party to a discredited and unpopular orthodoxy.

Labour will not “turn on the taps” of public spending, Starmer intones, having swallowed the 1990s Tony Blair playbook whole and struggling to comprehend today’s totally different economic climate.

Tory mismanagement of the economy since 2010 has left us with a weak economy and fragile public finances: for which his cure is to maintain the very austerity that brought us to this point. 

The growth he promises will elude him, for reasons Ending Stagnation sets out in detail.

Britain’s low productivity compared to France, Germany or the United States is above all down to a lack of investment, both public and private.

Control of our national infrastructure has been handed over to private “investors” to an almost unique degree. Privatised water supply is an international anomaly: it’s a public asset in almost every European country, as well as the US. 

Short-term shareholders interested in quick returns have no incentive to invest in maintenance or development, which is why privatisation has resulted in constant sewage leaks while suppliers pay out billions in dividends.

Analogous problems apply to transport. Ending Stagnation notes Britain’s decrepit transport network as a severe disincentive to business investment. It matters that our buses and trains are less reliable, more expensive and slower than their counterparts across Europe and Asia. 

It matters that our public services are worse funded. Wes Streeting never tires of claiming the NHS costs too much, though we spend less per head on health than any of our neighbours. We have seven million people on waiting lists: and the government thinks a rise in the number of long-term sick is evidence people are cheating the system.

It matters that local government has been starved of funds and struggles to deliver responsibilities from care to refuse collection.

Our schools are literally falling apart. Poverty is blighting the educational chances of a generation. 

Poor infrastructure and a failure to tax land and wealth combine to discourage productive investment by business and encourage property speculation, which drives up house prices. Institutions public and private are asset-stripped, the loot shipped abroad — causing the collapse of high-street giants and a prolonged crisis at an essential service, Royal Mail.

The Resolution Foundation’s recommendations? We need to raise taxation and public spending, especially on investment. We need to raise wages.

The money is there: the rich are richer than ever before, and the profit margins of major corporations have gone through the roof since Covid.

From 2017-19 Labour had a programme that would deliver a lot of this. Now, it offers nothing that would alter our trajectory toward ever-lower pay, ever weaker services and daily robbery by a rentier elite.

Unions can call this out. There is no reason to settle for a Labour government indistinguishable from a Tory one. 

A working class whose wave of strikes shows it “refuses to be poor any more” cannot avoid direct confrontation with a Labour Party that refuses to listen.

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