Everyone knows Labour has made mistakes. What is more worrying is why those mistakes were made.

 

Every political journalist has been writing their one year assessment of the Labour government. The general view is that Labour is in crisis, “has started to unravel at a frightening pace”, and we should prepare for Farage as Prime Minister. It seems our over excited political commentariat has not yet adjusted to there not being a Conservative government where ministers and even Prime Ministers had a short shelf life, and politics resembled a Line of Duty script. The reality is that Labour will be in power for another four years, and Starmer will almost certainly be Prime Minister for another four years.

Which means this Labour government and its leadership have plenty of time to learn from their mistakes. But they can only learn if they understand not only what the key mistakes were but also why they were made. If you look at the reasons for those mistakes, then it is hard to be confident that they will be fixed.

The first major mistake, as no one who regularly reads what I write will be surprised to learn, is tax. More and more commentators have realised that the tax increases announced in the last budget, although large, were also inadequate. The most recent is Will Dunn in the New Statesman. For what it is worth, the scale of tax increases that were actually required in October were obvious to anyone who did the sums. While few among the political commentariat do sums, the Chancellor certainly should have done so.

The standard explanation for this failure is Labour’s determination to win the election, and avoid anything that could put that at risk. But if that was all there was to it, then once in power you would expect the Chancellor to grab any opportunity to row back on pre-election pledges. Those opportunities did arise, but they were not taken. It does look as if Labour believed that tax rises just to prevent the spending cuts pencilled in by Hunt was all they needed to do.

How is that possible, when crunching the numbers showed that this meant keeping levels of public service provision well below those achieved at the end of the last Labour government? One possible explanation is that Reeves wanted to copy the path trodden by that last Labour government, spending its first term demonstrating financial credibility, and only increasing spending after winning a second election. However that seems unlikely, if only because Labour wlll be under even more pressure to make pledges on tax at the next election. (I discussed here why repeating the path followed by the last Labour government will not work in electoral terms.)

A more plausible explanation is that Labour thought, and continues to think, that it can bring about sufficient improvements in public service provision by just not being a dysfunctional Conservative government. It is certainly true that the Conservative government that started in 2019 was unusually incompetent: predictably so as it was led by someone who should never have been allowed near No.10. But it was never realistic to think that better management could bring Western European levels of public service provision with substantially lower than Western European levels of tax.

A more likely explanation for why Labour didn’t think it had to raise taxes by much more than it did in October was that they accepted that George Osborne was correct: the size of the state under New Labour was too large, and he was essentially right to shrink it. This meant Labour in government would be a more competent version of a post-Osborne Conservative government. It would, for example, carry on not raising fuel duty just as every Conservative Chancellor since 2010 had done. If, partly as a result, events meant that fiscal rules might not hold, Labour would do what a Conservative government would do, and trim spending.

At which point many on the left will be saying I told you so. But this misunderstands everything I have written for well over a year, and also makes the same mistake that this government has made. The key point is not that this government holds an ideological view that the left (and even New Labour) disagrees with [1], but that it holds a view that is not sustainable in political terms. What we saw, thankfully, with the revolt over the disability cuts was precisely this. What we are seeing with Labour’s dreadful performance in the polls is precisely this. Osborne’s vision of a smaller state was never one that could be sustained politically, which is why he had to lie about cuts being all about reducing the budget deficit.

The second key mistake the government has made is to ape Reform on immigration. As with tax, this mistake is increasingly understood by more thoughtful political commentators. Just look at the result of Labour’s strategy to sound tough on immigration, which essentially just means sounding like Nigel Farage. It has meant that immigration is now viewed by voters as the most important issue facing the country. It has meant Farage leading the polls, and Labour’s already low poll share falling even further.

Starmer says he regrets one particular part of his recent speech on immigration. But the whole speech, presumably put together by his advisors in No.10, was terrible. It not only sounded like something Farage could give, it also included the straight lies that Farage typically makes. Voters will think that immigration is the most important issue if they believe that the poor levels of public service provision is due to high immigration, which is the lie Farage and the Conservatives tell. In that speech Labour repeated the same lie.

The speech did offer a glimmer of hope for a better policy. If Labour wants to accept that immigration has to be lower, it needs to pursue an intelligent approach to getting it lower, which is to focus on the causes of high immigration. The speech talked about UK firms preferring to hire overseas rather than offering training and apprenticeships. I have no idea if that is true, but if it is it represents the kind of approach to reducing immigration that might work without severely damaging sectors of the economy.

However if that glimmer of hope is to become a proper strategy, then those advising Starmer need to experience a sea-change in their approach, or go. I’m not a political journalist, so I only know what I read from those who are. The supposed success that McSweeney has had in the past fighting right wing populists seems to be typical mythmaking by political journalists happy to flatter egos for access. In my view Labour did need to largely follow the socially conservative playbook in opposition, but it was hardly rocket science to understand that, which is why I said so back in 2021. More generally, playing safe by triangulating as far as you can towards a very unpopular government is hardly a new strategy.

But it is equally obvious to anyone who thinks about it for a second that strategies that work for oppositions often don’t work for governments, because voters understandably judge governments on their record. Again ‘I told you so’s from the left about the inability of Labour in government to adopt a distinct strategy from Labour in opposition miss the point. The point is that strategies in the two situations can be different, and in my view have to be different if Labour is to survive against the right wing populist threat.

What that strategy needs to be on immigration requires a separate post, but what it has to do is easier to set out. It cannot be Farage lite or like, because Labour’s record in office on immigration or asylum will never satisfy the media, and so socially conservative voters will choose Farage if everyone’s rhetoric is the same. Labour’s only hope is to convince voters that on immigration, like Brexit or fiscal policy, what right wing populists offer is fool’s gold. This should be possible, because it happens to be true. Labour can quite plausibly argue that while everyone is promising lower immigration, only they are doing so in a way that doesn’t damage the economy. But at the moment neither their policies or rhetoric do that.

The final big mistake Labour are making is not being honest about Brexit. There is a legitimate argument to be had about how fast the UK should try to harmonise with the EU to boost trade, and in particular whether and when to rejoin the EU’s customs union and single market. Maybe Labour’s current red lines on these two make political sense (or maybe not), even though they represent a self-imposed, politically harmful brake on growth and living standards. But Labour should not as a result of these red lines avoid being truthful about the economic costs of Brexit, for two obvious reasons.

The first is that Brexit is going to get more and more unpopular over time, and so if Labour is to get a second term continuing with its red lines it will become harder for voters to understand why. The second is that Brexit is Labour’s most effective weapon against Farage [2], because even many of those who support Brexit recognise that the Leave side promised a rosy future that hasn’t materialised. In political terms Farage is Brexit, and the failure of Brexit should sink Farage, but only if government politicians are prepared to label Brexit a failure.

Calling Brexit a failure does not require that we immediately rejoin the EU. There is a perfectly respectable political argument that small steps are best. But the reason why Labour are not being honest about the costs of Brexit is the same reason they are not being honest on immigration, and that is a naive political strategy that doesn’t recognise the difference between being in opposition and government.

There is little sign that the government understands this, so there is also little hope that it will change anytime soon. It will raise taxes, but probably by only enough to put out the current fires, leaving it vulnerable to all the new fires that will emerge over the next few years. Unless it is lucky, Labour’s fiscal policy will continue to dance on a razor’s edge. On immigration it will continue to ape Farage, and that strategy will be as successful as it has been so far. By not being honest about Brexit, Labour will be forsaking its strongest weapon against the populists.

[1] To be clear, this is a view about the size of the state. Arguably this government is more left wing than New Labour in some other areas.

[2] Another great weapon against Farage is Trump, and the consequences for his actions on the US and global economy. While the attraction of UK ministers flattering Trump is obvious, that should not hold Labour back from pointing out the chaos of his rule, and the similarities in policy between Reform and Trump. A third weapon is action to reduce climate change, where the populist right have - like Trump - become not only climate change deniers but also prefer what is now more expensive energy. This is one area where the Labour government has something to cheer about, and it says a lot about the operation inside No. 10 that Ed Miliband is constantly receiving negative briefing.