Labour’s position on Brexit is not a compromise, but is taking the wrong side

The elections for the European parliament showed us the implications of a basic imbalance in politics today. Brexit is the dominant issue, yet both of the major parties support one side, the Brexit side. The Labour leadership tells itself that it is trying to bring the two sides together. It tells itself, by aiming for a softer Brexit than May wanted, it is trying to compromise. But as someone once said, Brexit is Brexit, and those voting in the European elections agreed.

To see why Labour’s position will not bring people together, just look at what happened to the Conservative vote. May was trying to achieve a very hard Brexit, where we were neither a member of the Single Market or Customs Union. She failed mainly because the Brexit extremists in her own party did not support her. European election voters punished the Conservatives and sided with the Conservative extremists. They didn’t want compromise.

Suppose Labour, after winning a future general election, enacted their softer Brexit. Would voters come together recognising Labour had attempted to unite both sides? Those voting for the Brexit party of Nigel Farage certainly would not. That slightly more Labour voters from 2017 voted fot the explicit Remain parties combined than Labour in the European elections suggests no appetite for compromise on that side either. Labour would instead suffer the fate of Theresa May and be hated by Remainers and Brexiters alike.

It is for that reason that this discussion is purely academic. Not because Labour would not win an election advocating a softer Brexit: there is a non-zero probability they would. Instead it is because Labour would end up being like Theresa May in failing to achieve their desired Brexit. As I argue here, the Conservatives would say Labour’s Brexit was a betrayal. Labour would only stand a chance of getting it through parliament if they agreed to have a second referendum with Remain on the ballot, and they would lose that referendum badly because Remainers and Brexiters would vote against them.

This dislike of a compromise is not irrational. Brexiters have ending up with No Deal because anything else fails to get complete independence from the EU. They are quite right to say that a softer Brexit would be worse for sovereignty than Remaining, because it amounts to pay, obey but no say. Equally for most Remainers a soft Brexit is qualitatively worse than staying in the EU. Look at the way the EU has supported Ireland in these negotiations, they would say. The moment you leave the club, you lose the backing of one of the most powerful political and economic organisations in the world. They are quite right to point to the many flaws in believing that the 2016 referendum is a mandate for any particular type of Brexit.

Why therefore are Labour antagonising their 2017 voters and their members by having a Brexit position that will be very unpopular and impossible to achieve? The answer normally given is that this is the only way to win a general election. Anything else risks losing ‘heartland seats’ because Labour voters will vote for a Brexit party. While this idea might have had some validity in 2017, it has since become an article of faith rather than an evidence based argument.

The basic problem with this argument is that there are many Remain voters in the constituencies that voted Leave in 2016. Polls throughout 2019 suggest a 3 to 1 ratio: by supporting Brexit Labour are losing three times as many Remain voters as any Leave voters they would lose by supporting Remain. The European elections backed part of that finding up with actual votes, and also suggested Labour are in danger of losing Leave voters anyway with their current stance. If anything like that ratio persists, they will lose their traditional heartland seats because Remain voters will not vote Labour.

The table below is from the Ashcroft exit poll for the European election. It compares the percentage of voters who voted for Labour or explicit Remain parties, and also the Leave/Remain balance, by region. The most Leave orientated regions are to the left. Overall this sample is almost certainly biased to Leave voters, because only a tiny number of young people (18-24) voted, and polls regularly show a small lead for Remain over Leave.

%	EM	NE	York	WM	East	SE	Wales	NW	SW	Lon	Scot
Leave	59	55	54	54	54	52	51	50	50	39	37
Remain	38	38	43	42	42	45	45	45	46	57	59
Lab	11	21	17	17	9	9	12	23	11	17	10
LD,G+	33	28	35	31	40	40	43	34	43	46	62
Lab L	4	7	6	6	3	3	4	8	4	6	3

The first point to make is that the outliers here are London and Scotland. Elsewhere, the Leave vote varies from 59% to 50%, and the Remain vote from 38% to 46%. The idea that leave voters are predominantly in the ‘North’ is nonsense. (If anything, the English divide is East versus West outside London, but it is still a small tendency rather than a real divide.) A key consequence of this observation is that areas like the East Midlands and the North East still contain many Remain voters.

These voters made their choice on the basis of the current policy stance of their parties. Nationally about a third of Labour voters in the European election want some kind of Brexit (Ashcroft does not give a regional breakdown), and two thirds want to Remain. The final row applies that percentage to the Labour vote in each region to get the percentage of Labour leavers. These are the maximum number of voters that Labour could lose from its European election result if it became a Remain party. Compare that to the total number of Remain voters, nearly all of whom could vote Labour if it became a Remain party.

The article of faith that those who justify Labour’s current stance cling to is that Remain voters will return to Labour in any general election, while if Labour became a Remain party any Leave voters would be lost. Examples in the past of protest votes that have all but disappeared are given to justify that faith. But it is never explained why Remain voters will come back to Labour even though it supports Brexit, but Leave voters will not come back in a general election if Labour supports Remain. In addition Brexit is not like anything in the past. It has divided the country like no issue before it. As I showed above, you really need pretty well all Labour Remainers to return to the fold to get a number smaller than the number of likely Leave losses.

The idea that Remain voters, and not the Leave vote, will return en masse to Labour in a general election relies in part on a universal use of tactical voting that is simply unrealistic. A good example will be the forthcoming Peterborough by-electon, which is a classic example of a Leave marginal that we are told Labour has to keep its current Brexit policy to win. If the European elections are anything to go by, Brexit will win. In 2017, when Labour just won, the LibDem and Green vote was small. Let’s see if Labour voters from 2017 will unite to keep the Brexit party out.

Some say it worked in 2017, so why will it not work in the future? Many things have changed since 2017 (when Labour still lost). The stance of the EU is now clear, and therefore so is the range of deals the UK could possibly get. The Remain movement is much stronger. But the Labour party has also changed. The 2017 election was the era of Starmer’s 6 tests, which included the ‘exact same benefits’. Today those tests are gone, and instead we have prolonged negotiations between the government and Labour over a possible Brexit deal. Too many Remainers who voted for Labour in 2017 feel they can no longer trust Corbyn on Brexit.

The weakness of the argument to keep current policy and ignore the European elections and the polling evidence has lead some to resort to nostalgia. The argument goes that the working class support for Leave is above the national average, and Labour should be a party of the working class. Labour is becoming less and less a working class party. Supporting Remain would be to “abandon much of the working class – and with it any prospect of a Labour government” according to Lisa Nandy.

There are three main holes in this argument. First there are plenty of working class voters that support Remain. Adopting a Brexit policy, even if it is milder than Theresa May’s hard Brexit, is in danger of alienating those voters. Second, Labour stopped being the party of the working class some time ago. Its heartlands today are in large cities and university towns, and supporting Brexit betrays its new heartlands. It betrays the young who overwhelmingly support Remain and overwhelmingly support Labour.

Third, the way you get the working class vote back is by promising or enacting economic measures that help the working class, and not by offering a weaker form (in their view) of Brexit to socially conservative working class voters. If Brexit, then why not immigration? If you think about it, Labour have been trying to appease exactly the same group of voters who voted Brexit for at least a decade, and they have failed miserably for one simple reason. Anyone who wants Brexit enough not to vote Labour is not going to be convinced by a party that is Remain at heart and which is offering them a half baked version of what they want. It was true for immigration under Blair/Brown and Miliband, and it remains true for Brexit.

I said there was still a chance that Labour with its current Brexit policy could win the next election. However the probability that it could win an election with a new policy that fully supports Remain is much higher, and certainly over 50%. The Leave voted could be divided, but the Remain vote if Labour supports Remain much less so. The key to any change in policy is to recognise that, thanks to the Brexiters, a ‘middle way’ (Labour’s current policy) is no longer possible. It will always be opposed by a blocking coalition of No Deal Brexiters and Remainers. The choice is now No Deal, a hard Brexit under the Tories or Remain. Of those three Labour have to support Remain.

What about a small shift in Labour policy, supporting an unconditional People’s Vote where Remain is always a choice on the ballot? The trouble with that policy is it traps Labour with endless questions of under what circumstances Labour would support Remain. Instead of the campaigning party Labour should be on Brexit, it becomes in most voters eyes the party of convoluted explanations. The next Brexit battle is to stop No Deal, and Labour can only do that effectively if it stops pretending it can achieve a softer Brexit.

A divided nation

After the Brexit vote, economists and others who voted Remain are quite right to say I told you so as the economic hit they expected comes to pass. The Brexit Bust needs to be labelled clearly, given the power the Leave side has over the means of communication. (Those behind that campaign are already talking utter nonsense in order to pretend it had nothing to do with them.) But those who voted Remain also need to understand why they lost.

The studies I’m going to focus on here use regressions and the breakdown of the Brexit vote district by district. [1] It is important to do regression analysis, which can look at more than one factor at a time, because influences are correlated with each other. We might note, for example, that districts are less likely to vote Leave if they contain relatively high earners, or relatively well educated people. So is it lack of education or lack of money that caused people to vote Leave? That is what any kind of multiple regression can try and sort out.

Before looking at individual studies, let me mention some things that appear to be uncontroversial. Education and age are key determinates: if you are less educated or older you tend to vote Leave. Both matter independently: although young people with few qualifications tend to vote Leave, they are less likely to do so than less qualified older people.Once you take these into account, income is not a significant factor. Geography matters in key ways. One of those is that people in Scotland and Northern Ireland were much less likely to want to leave (controlling for other factors). The other I will come to.

A key issue is whether the local level of migration has had an influence. Stephen Clarke and Matthew Whittaker at the Resolution Foundation find that the level of immigration is not important, but its recent rate of change is, in making people vote Leave. Zsolt Darvas at Bruegel also finds the level unimportant. However Monica Langella and Alan Manning from the LSE find that areas with high immigration are more likely to vote Leave, and confirm the finding that the rate of change matters too. So while two studies agree that areas with a recent large increase in immigration are more likely to vote leave, more work needs to be done on whether its actual level matters. However, even if it matters, it does not matter that much, as the large majority for Remain in London tells us.

One other area where the studies differ is employment or unemployment. Clarke and Whittaker suggest areas with a low employment rate are more likely to vote Leave, but Langella and Manning seem to find the opposite, and Darvas says any impact from levels of unemployment (which is not the same as the inverse of the employment rate) is explained by other factors which I will now come to.

There are some variables that have not been considered by all three of these studies. Darvas has one particularly interesting result: the Leave vote increases in areas where there is a lot of poverty and local inequality. Langella and Manning find that areas with long term declines in agricultural, manufacturing or public employment are more likely to vote Leave. This is also the conclusion of a team led by Bristol geographer Ron Johnston, which is worth quoting in full.

“There are substantial parts of the country where large numbers of people have lost out from the deindustrialisation and globalisation of the last few decades of neo-liberal economic policies, and where the educational system has not helped large proportions of the young to equip themselves for the new labour market. Increasing numbers in these disadvantaged groups were won over during the last few decades by the campaigns in parts of the print media, taken up by UKIP since the 1990s, linking their situations to the impact of immigration – uncontrollable because of the EU freedom of movement of labour principle. The wider Leave campaign built on that foundation in 2016, producing the geography displayed here.”

That conclusion of course goes beyond the finding that areas hard hit by globalisation tended to vote Leave, and adds an explanation that sees the press and politicians actively trying to link the experience of disadvantage to the issue of immigration. It is an argument I have also made. Unfortunately it is an argument that is very difficult to prove using regression analysis, because - as newspapers often argue - they may print just what sells newspapers, so any correlation does not imply causation.

It is also important to remember that the link between voting Leave and areas of deindustrialisation is in additional to the strong links with education and age. Education may fit in with a story where the anti-EU stance (to say bias does not do it justice) of most of the tabloid press is important, for obvious reasons. The same is true with age, as younger people are likely to get their information by other means than the tabloid press.   

There is another, very different, line of argument that tries to explain the Leave vote not in terms of class but psychology/culture. Eric Kaufmann finds simple correlations between voting Leave and authoritarianism. A story you can tell is that, for some at least, Brexit was a vote against not neoliberalism but social liberalism. The link between social liberalism and the EU is once again migration, which represents one more unwelcome change for social conservatives. Social conservatism and authoritarianism may also map more easily into nationalism and wanting to 'take control', and it was part of the tabloid 'grooming' to do exactly that. Social conservatism may also explain the importance of age and perhaps also education.

There is no reason why we need to choose between the economic and the social types of explanation. Kaufmann and Johnston et al can both be right. As Max Wind-Cowie says (quoted by Rick here):

“Bringing together the dissatisfied of Tunbridge Wells and the downtrodden of Merseyside is a remarkable feat, and it stems from UKIP’s empathy for those who have been left behind by the relentless march of globalisation and glib liberalism.”

Both these explanations see antagonism to the idea (rather than the actuality) of migration as the way an underlying grievance got translated into a dislike of the EU. But was immigration really so crucial? A widely quoted poll by Lord Ashcroft says a wish for sovereignty was more important. The problem here, of course, is that sovereignty - and a phrase like taking back control - is an all embracing term which might well be seen as more encompassing than just a concern about immigration. It really needs a follow-up asking what aspects of sovereignty are important. If we look at what Leavers thought was important, the “ability to control our own laws” seemed to have little to do with the final vote compared to more standard concerns, including immigration.

However there are other aspects of the Ashcroft poll that I think are revealing. First, economic arguments were important for Remain voters. The economic message did get through to many voters. Second, the NHS was important to Leave voters, so the point economists also made that ending free movement would harm the NHS was either not believed or did not get through to this group. Indeed “more than two thirds (69%) of leavers, by contrast, thought the decision “might make us a bit better or worse off as a country, but there probably isn’t much in it either way””. Whether they did not know about the overwhelming consensus among economists who thought otherwise, or chose to ignore it, we cannot tell.

Third, Leave voters are far more pessimistic about the future, and also tend to believe that life today is much worse than life 30 years ago. Finally, those who thought the following were a source of ill rather than good - multiculturalism, social liberalism, feminism, globalisation, the internet, the green movement and immigration - tended by large majorities to vote Leave. Only in the case of capitalism did as many Remain and Leave voters cite it as a source of ill. These results suggest that Leave voters were those left behind in modern society in either an economic or social way (or perhaps both).

Taking all this evidence into account it seems that the Brexit vote was a protest vote against both the impact of globalisation and social liberalism. The two are connected by immigration, and of course the one certainty of the Brexit debate was that free movement prevented controls on EU migration. But that does not mean defeat was inevitable, as Chris makes clear. Kevin O’Rourke points out that the state can play an active role in compensating the losers from globalisation, and of course in recent years there has been an attempt to roll back the state. Furthermore, as Johnston et al suggest, the connection between economic decline and immigration is more manufactured than real. Tomorrow I’ll discuss both the campaign and what implications this all might have.

[1] Please let me know if I missed any studies. One I found out about as this post was about to be published was this by Richard Mann.

Rolling Postscript: Studies I've seen since. This by Jo Michell (particularly on migration impact). Geoff Tily argues that London may be special.  

Where Labour went wrong

When the New Statesman asked me to write something on Osborne’s budget surplus law, they also suggested I talk about what Labour’s attitude should be. Space constraints meant that I could not say much on the second question, so let me amplify here.

Let's start in 2009. The Labour government's policy at the time was absolutely right. They provided fiscal support for the economy in the midst of the recession even though it meant increasing the deficit. Given the belief at the time that the recession might be short lived their policy was also quite clever, using a temporary cut in VAT as a close proxy for looser monetary policy.

What line should they have taken in 2010? I remember reading some reports that Gordon Brown initially wanted to continue placing the recovery above the need to reduce the deficit. If true, he was right. However it was perhaps inevitable that Labour began to also focus on deficit reduction: the recovery looked like it had begun, the debt problems in the Eurozone were constantly in the news, and the Conservatives and much of the media were saying we could become like Greece. So they instead fell back on the idea that recovery could be achieved at the same time as implementing policies designed to reduce the deficit. We can call this the ‘too far, too fast’ period, from the mantra Ed Balls used to criticise George Osborne’s policy.

This was when they made their first big mistake. Both Coalition parties had developed their own mantra, which I can call the ‘clearing up the mess Labour left’ line: Labour profligacy had maxed out the credit card, and so difficult measures would be needed. This is what Bill Keegan calls the big lie. Apparently Alastair Campbell advised Ed Miliband to get an independent figure to do a report on Labour’s fiscal record in an effort to counter this lie, but this advice was rejected. (The paper I wrote came out in 2013, but still to my knowledge Labour has never used it.)

I have seen two reasons given for why Labour chose not to defend its record: Miliband wanted to establish his independence from a government that had lost an election (to ‘move on’), and it was thought that the Coalition strategy of blaming the last government would lose its potency after a year or two. The second argument proved horribly wrong. Instead the ‘clearing up the mess’ line was used to blame Labour for damage caused by 2010 austerity. It was complete nonsense, but it worked. 

In a way 2011 and 2012 were too easy for Labour: the economy was stagnant and Osborne looked vulnerable. But Labour should have anticipated that growth would return at some point before the election - if I could, surely they could. They will not have anticipated the stagnant productivity that allowed unemployment to fall so rapidly, but in political terms growth would have probably trumped high unemployment anyway, as I suggested back in 2012.

What should have happened in 2012 is that the ‘too far, too fast’ line should have changed to become a full blown attack on austerity: that was their second big mistake. By 2012 it was obvious that fears about a UK debt crisis had been completely overblown. The problem with ‘too far, too fast’ is that it sounded like austerity-lite: the need to focus on the deficit was conceded. Labour could have easily got away with changing its line at this point. They could have said that we thought there was a debt funding problem, but now we know there wasn’t. The argument that austerity should be postponed until the recovery is assured (i.e. when interest rates are well away from the Zero Lower Bound) was right in terms of the macroeconomics, but it would also have allowed Labour to combat the ‘clearing up the mess’ line, and profited from Osborne’s move to plan B.

Instead Labour seemed to be constantly triangulating between sensible macroeconomics and what the focus groups were telling them, and thereby producing a policy that failed to convince. Their fiscal policy proposals going into the 2015 election were much more sensible than George Osborne’s, but instead of attacking his renewed austerity they tried to pretend that they too were ‘tough on the deficit’. It was left to the SNP to argue against austerity.

The problem was that instead of presenting a clear alternative vision, Labour looked like it was always playing catch-up with Osborne. As John Curtice writes: “the Achilles’ heel of Labour’s campaign appears to have been a failure to convince those who were sceptical about the Conservatives’ economic record that Labour offered an attractive alternative.” As Lord Ashcroft’s polls show, and as I noted sometime before the election, by 2015 around half the public were against the continuation of austerity, yet Labour’s message on this was confused.

Today Labour continues to think that triangulating on the deficit, or worse just copying Osborne, is the answer. I think this tells us a great deal about the Labour party. That it is light on good macroeconomic advice and expertise, of course. But also that it spends too much time listening to people in the Westminster bubble and fails to spend time thinking about basic electoral strategy.

What Labour needs to ask now is what will prevent the Conservatives convincing the electorate in 2020 that Labour just cannot be trusted on the economy? Admitting their past fiscal mistakes when in government now, however much that is partial and hedged, will just give ammunition to their opponents in five years time. (Just read this, and extract the quotes.) More serious still, by allowing the focus to remain on the deficit, it lets Osborne get away with the damage he inflicted in 2010-2012, and the continuing social costs of austerity. What is the point in talking about the record on growth or productivity, when you appear to have conceded that reducing the deficit is all important, and Osborne is doing plenty of it?

In my New Statesman piece I say it is still not too late to change tack, stop triangulating and try something new - to start telling the truth. But I think there is a danger that this sentence frames the discussion in the wrong way, so it appears to be a contest between pursuing the right policy and winning elections. This post is all about the best way of regaining economic credibility, which means taking a strategic view rather than looking at what sounds good to today’s focus group. Put simply, if around half the electorate already think austerity should not continue, why on earth are Labour giving in to deficit fetishism? In electoral terms, the fact that attacking austerity is also good macroeconomics is just a bonus.