If only someone had warned us

The title is pinched from a tweet by Tony Yates, who was one of many economists who did warn of the impact of Brexit. Of course we economists need to ask ourselves if and why our message was ignored, but that is no reason to stop us feeling angry that it happened. This post from the economist who did more than most to try and get the message across, John Van Reenen, expresses that anger better than I could.

What John’s work showed, backed up by similar analysis in the Treasury and elsewhere, is that Brexit would not just cause a short term economic downturn: cutting wages and increasing unemployment for just a year or two. By making it harder to trade with our immediate neighbours it will reduce UK trade overall, and the evidence suggests that this will permanently reduce people’s living standards. The markets clearly agree, which is why sterling fell immediately and substantially after the Brexit vote. In terms of people’s living standards that was not a ‘might be bad, might be good’ event: it makes everyone in the UK poorer. (Never start from a price change, but ask why prices changed.)

The tricky thing to do now is know how much the current downturn is just a foretaste of that, and how much is something over and above that. To the extent that it is the latter, how much

of that is offset by some short term benefit to exporters (before the impact of actual Brexit kicks in) as a result of the depreciation? That is initially the Bank of England’s problem.

Their response today, a cut of 0.25% plus more QE, tells us it is not just their problem. We are back at the lower bound for nominal interest rates, which is why the Bank is doing more QE. Because the impact of the QE is extremely uncertain, and in the absence of helicopter money, we now need fiscal action to back up this interest rate cut. That is what Labour’s fiscal credibility rule, and the academic work by Jonathan Portes and myself, utilising textbook and state of the art macro, tells us we should do. When interest rates are at the lower bound, forget about the deficit and focus fiscal policy on avoiding a recession. As the Bank’s QE action makes clear, there is no good reason to delay this: it should happen now.

But Brexit was not the first time economists have been ignored. For some years now the clear consensus among academic economists is that, when rates are at their lower bound, you need fiscal stimulus. Although Conservatives have disowned 2015 Osborne austerity, they appear not to have backtracked on his 2010 version. If they do nothing now, we will know that they are wedded to pre-Keynesian 1930s economics.

Mutually Assured Destruction

When I called half a year ago the minority of MPs and associated journalists that was trying, and had tried from day 1, to openly undermine Jeremy Corbyn’s leadership Labour’s “new militant tendency”, I was doing the original militants a disservice. My complaint at the time against these “anti-Corbynistas” was that they muddied the waters for any Labour party member who needed to see how well Corbyn was doing, because bad poll results could easily, and with some justification, be blamed on their activities. If the anti-Corbynistas were right about Corbyn’s unelectability (and unless their aim was to form a new party), they were shooting themselves in the foot and prolonging his period in office through their activities.

I hugely understated my case. The damage they were doing turned out to be much worse than that: they were firing the first missile in a war of mutually assured destruction for the party. The reason relates not to Corbyn’s electability but his competence. As Owen Jones suggests, Corbyn - unlike John McDonnell - has failed to adjust to his new role. He seems to be repeatedly “missing in action” at key points. Both he and McDonnell needed quickly to form a good working relationship with the shadow cabinet, as good politicians can often do with others holding very different views, but they failed to do so. As Neal Lawson writes of Corbyn, “no one with any sense or insight believes he has the leadership skills to craft a majoritarian politics”.

Now many people, including the anti-Corbynistas, will happily tell me that this was obvious before Corbyn was elected, and I was naive not to say so more strongly before he was first elected. But this fails to acknowledge the terrible place the majority of the PLP were in at the time, and that the membership needed to do something about it. To quote Lawson again, he voted “for the wave not the surfer”.The model of how to win elections that the PLP had taken from the Blair years was leading them to endorse austerity and abstain on welfare cuts. They needed a shock to force them to rethink, and Corbyn’s 2015 victory was that shock.

Following his election the majority of MPs did try working with Corbyn, or else stay quietly on the sidelines. They did not spend their days trying to undermine him: they were not part of the group I call the anti-Corbynistas. But then what this section of MPs saw was Corbyn’s failure to lead, or indeed promote the party outside of the membership. There were some in Corbyn’s team, like Neale Coleman, who understood what was required, but he resigned in January (and now works for Owen Smith). Although McDonnell was making progress in some areas, like the adoption of a state of the art fiscal rule [1], there seemed to be no sign of improvement from Corbyn. Each MP has their own individual story of lack of competence and communication (e.g. here, here or here), as do others who had contact with the leadership. The majority of MPs from the middle of the party began to realise that in all conscience they could not argue that Corbyn should be a prime minister.

But try to suggest that to many members who support Corbyn, and it does not compute. For them all 172 MPs are now ‘plotters’, determined to overthrow the power of members to choose the leader they want. In my experience it is not quite the paranoia discussed here, but there seems to be no attempt to understand the diversity of motives within the PLP. All examples of Corbyn’s inadequacy are brushed aside as ‘smears’, again based on the antics of some anti-Corbynistas. The anti-Corbynistas said Corbyn’s policies made him unelectable, a proposition which those on the left with some justification reject. This appears to mean that a very different proposition - that a leader rejected by 80% of his MPs whatever his policies is unelectable - is brushed aside. In other words Corbyn’s supporters have adopted the anti-Corbynistas as their model of what has happened to the PLP, which allows them to dismiss any reasonable criticism. That is the devastating contribution the anti-Corbynistas have made to the current situation.

For many members this election has become about their right to elect Labour’s leader, which they believe the PLP are trying to take away from them. Many of the PLP respect that right, but believe they have to inform the membership that Corbyn is not a competent leader or a credible PM. Yet that more nuanced view seems lost on many members, who seem to regard the majority of the PLP as unfit to be in the Labour party they want.

The ‘coup’ was in my view both mistimed and misjudged, and the attempt to keep Corbyn off the ballot paper bizarre. But the coup is not explained by Corbyn’s supporters as the desperate actions of those who had just witnessed the Brexit vote after the Labour leadership followed a flawed campaign, the last and most important act of leadership inadequacy and mismanagement. Instead, following McDonnell, they believe it shows how incompetent the PLP are at staging a coup.

As in a war, the language being used takes on a righteous tone. Rather than think in terms of the politics of what might happen, we get the morality of what should happen. Rather than contemplate adaptation as events change and capabilities are revealed, we get the defiant talk of no compromise.

A Corbyn victory would be the return salvo in this war of mutually assured destruction. Here is the best outcome I can foresee if Corbyn wins. Most MPs will batten down the hatches, waiting for something to turn up. A few will try and work with him, hoping against judgement that things might improve, but most will not. Polls will stay terrible but show some improvement as some voters forget Labour’s internal divisions, the tabloids will keep relatively quiet because they want Corbyn to stay, and Labour gets some protest votes. Perhaps some electoral setback will result in another leadership challenge.

But come any general election who is going to vote for a party where less than 20% of MPs have confidence in their leader? Any media interview with any of the 172 will ask how can you say Corbyn is fit to be PM if you had no confidence in him 4 years ago, and what does this change of heart tell us about your judgement? If the antics of a minority of Corbynistas can be used to explain Corbyn’s poor poll ratings, using the same logic to think about the next general election means it will be disastrous.

The result will be terrible not just for Labour but also its left. The experience of 1983 marked the beginning of the end for the left of the Labour party. There will be some members who really mean it when they say that Corbyn is the start of a long term project, and that it may take a decade or more to rebuild the party, but most members will grow tired of losing elections during that time. Corbyn’s refusal to back down will harm those that might come after him.

I have looked and listened for a more optimistic outcome. I have read about how 21st century politics will be different because of social media, but as Ellie Mae O’Hagan writes, “78% of people rely on television as their main source of news, compared with 19% who use Facebook and 10% who use Twitter. Crucially, less than a third of respondents regarded Twitter as trustworthy.” I have read about grand alliances (which I support), but not why they save Labour and the left from this fate. I cannot see any plausible account of why things might be better: nothing any objective political scientist would even bother to critique.

The outcome I have painted, awful as it is, is not the worst that can happen, and may not even be the most likely outcome for two reasons. First, if Corbyn gets re-elected he is unlikely to receive a re-election bounce in the polls, so it will be very tempting for May to go for an early election. The means by which she can do so are straightforward.

Second, the idea that members are just refighting 2015 misses how much has changed since then, particularly with Brexit. In 2015 business and finance were 100% behind the Conservatives. With the Brexit vote, and the campaign’s leading lights running the coming negotiations, that has fundamentally changed. [2] With the Brexit vote what I would call the pro-European centre desperately wants an effective voice. With Cameron/Osborne gone, Brexit ministers in charge of negotiations and an expected recession the notion of Conservative competence at running the economy has gone. If Corbyn remains there will be a vacuum where an effective opposition should be, and that vacuum could well be filled by a new party. If there is serious talk of deselecting Labour MPs, that new party will include many of them.

If that happens, I see no reason why the 1980s will not repeat itself. Some Corbyn supporters, immersed in their imagined battle with the PLP, see this as just one more threat from the other side that they should discount (and - morality again - denounce). One even called it Project Fear to me. But the whole point about Project Fear was that it was a way for first the SNP and then the Brexit campaign to avoid talking about the consequences of their side winning. A way of avoiding hard truths.

The horrible irony about this fight to the death between the PLP and the membership is that the membership are fighting the last war which took place in a pre-Brexit landscape that was very different from today. As Owen Smith’s economic programme and this interview make clear, both Corbyn’s original victory and Brexit mean that the PLP has completely abandoned austerity. [3] Can it be that something the membership would gladly have voted for in 2015 is now seen as either inadequate or an illusion? Is it that power once obtained corrupts, or that those used to struggle and defeat can only trust someone who will ensure the same?

[1] Here Owen Jones makes a mistake. It is true that the mediamacro spin was that this new fiscal credibility rule was just like the policy under Balls, but it was crucially different: the rule allows the focus to switch from the deficit to output in a liquidity trap recession. In other words it was a rule that would have avoided 2010 austerity. One journalist described this as a ‘loophole’, but I think having a rule that avoided the austerity that did so much harm is pretty important. If it survives and the coming recession is bad, it will be crucial in allowing Labour to argue for more fiscal support than the Conservatives/Treasury will countenance.

[2] If you have access read the tone of the comments (click ‘most recommended’) to this FT article by Brexiter Bernard Jenkins. Or this.

[3] In this interview Smith does three things which I suggested in this post: he praises Corbyn for increasing and enthusing the party membership, he is highly critical of the 2015 election strategy, and he makes it clear that the UK will get a second opportunity to vote on Europe. Perhaps as a result of this, the line of argument I’ve now heard many times is that because Smith breaks so many Blairite taboos he cannot survive. Here I do think paranoia replaces any realistic assessment. If Jeremy Corbyn after a no confidence vote from 80% of the PLP will not step down, why would Owen Smith just because he was too left wing for a minority of the PLP?

Blanchflower on the Economic Advisory Committee

David Blanchflower has an article in today’s Guardian about his experience on Labour’s Economic Advisory Committee (EAC) which was chaired by John McDonnell. I agree with a lot of what he has to say in the article, but not with the picture painted of how the committee was used. He ignores the formation of Labour’s fiscal credibility rule which is an important and tangible consequence of the committee’s advice, and Mariana Mazzucato’s work featured strongly in John’s speeches. (More details here.) By ignoring these things he allows some critics to conclude that we were being used just for our reputations: that is simply false.

He also fails to mention the groups John McDonnell established to look at particular economic policy areas: groups that were quite independent of the EAC and the Labour party. The one on the Treasury chaired by Bob Kerslake (details here) will probably report at the end of this year, and if our discussions are anything to go by it should be of great interest to anyone concerned about this key part of the UK’s machinery of government. David himself was chair of a similar group on monetary policy (of which I, Adam Posen on John McFall were also members), and again preliminary discussions were very positive, so personally I regret David ended that at the same time as he resigned from the EAC.

I have seen so much nonsense written about how we only met twice (largely our choice), and about who attended (the only person not to attend either meeting was Thomas Piketty, and he resigned before David Blanchflower because of the pressure of other commitments). I and other members did not resign from the EAC: see the joint statement from 5 of us here. That statement was critical of Labour’s inability to prevent Brexit: I give my own reasons for making this criticism here. As David notes in the article, I feel strongly that for Jeremy Corbyn to continue after 172 MPs voted no confidence in him as leader would be disastrous for the Labour party. However I also believe John McDonnell should be praised for openly involving academic economists in policymaking, and in being prepared to use their advice.   

Should economics be democratised?

In the continuing fallout from the Brexit vote comes a call to democratise economics. I tend to think about these issues by drawing an analogy between economics and medicine. The reason I like this analogy is that both are stochastic sciences: people are unpredictable in terms of their behaviour and biology, at least in terms of the current state of knowledge. There remains a great deal that is mysterious. Both can use theory to a considerable degree, but both also rely on statistical analysis and experiments/trials. I am happy to acknowledge that medicine is ‘better’ in some sense than economics (although I do not really know, or know how that could be ascertained), but I would argue that any difference is of degree rather than kind.

One other similarity that is worth mentioning because it always comes up: both are hopeless at forecasting. Your doctor will not tell you how long you have to live, and can often only give you a rough idea even if you have a fatal disease. Economists get involved in macroeconomic forecasting not because users think it is accurate, but because it is marginally better than guesswork. But while doctors cannot tell you how long you will live, they can tell you that smoking will be very likely to shorten your life. Equally an inability to do good macro forecasts does nothing to refute the claim that if we make trade with our neighbours more difficult we will do less of it and this will reduce people’s welfare and incomes.

The two subjects are also similar in that key decisions are often delegated to expert committees: in the UK the MPC and NICE, for example. But when it comes to other policy decisions, the two subjects differ. Occasionally government or policymakers clash with medical experts on medical matters, but that is rare. In contrast politicians quite routinely ignore economic expertise, or choose minority views over the consensus. The difference is not hard to explain of course: political interests and economic decisions are often intertwined. This can in turn influence the discipline itself. But if you accept my analogy, this is not good for society. Those who voted for Brexit were told it would produce positive results for them in the long term, and will almost certainly be disappointed.

Is the solution to this to democratise economics? I cannot think of anyone, or at least no economist, who would object to the public knowing more economics. Some might go further, and suggest that knowledge of economics among policy makers is dangerously deficient. I would also agree that sometimes economists can learn from interactions with policymakers or even the public. But when it comes to medicine people generally do not want to know about medical science. What they want to know is what medical opinion is on key issues, and they want policymakers to make decisions that embody that knowledge.

I think the same is true of economics. Most people do not want to know the theoretical basis for why fiscal consolidation when interest rates are at their lower bound is bad for the economy, let alone the arguments that a few make against that consensus opinion. (If you read this blog, you may be an exception to this generalisation.) Instead they want to know what the consensus opinion is and how strong that consensus is. If the economics conflicts with their intuition, they might want to check that economists are answering the same question as they are. This the broadcast media generally fails to do, and the tabloids only do if it suits their political line. There are reasons for this in the way the media works, which I have discussed many times, but it would be negligent for economists to imagine it was not their problem as well.

For example in medicine I suspect you could rely on medics to be able to tell you what the consensus opinion on issues was. Unfortunately that would be less true in economics. But that is partly economists own collective fault, because the number working on subject areas can be quite large and not as well connected as they might be. To take just one example, there seemed to be a widespread perception among macroeconomists that many of the top schools taught little Keynesian economics at graduate level. It turns out according to survey data I and Andre Moriera collected that most schools do teach quite a bit of Keynesian economics.

Which leads to my punchline. Economists need to act more as a collective. We need to regularly survey economists (all economists, not just selected groups) about what they think on key policy issues, recording at the same time whether this is their area of expertise. We need spokespeople to explain any consensus in the media. When policymakers, City economists or think tanks depart from this consensus, these spokespeople need to be aggressive as a discipline in pointing this out, and not leave this to individual academics. Much as the medical profession does when rogue claims become popular. We do not so much need to democratise economics, but to organise it.

What Owen Smith needs to do

The betting odds suggest Jeremy Corbyn is a clear favourite to beat Owen Smith, even if those are based on thin information. But if comments on my last two posts, and personal conversations, are anything to go by Corbyn will be very hard to beat. People are always reluctant to hear that their preferred strategy is not working. After all it happened to Labour MPs when they believed they had to triangulate to the right to win elections, even after the 2015 defeat. Now it is happening to Labour party members who still believe they can create a mass social democratic party without the support of Labour MPs. Just as hope will not win out against reality for Labour under Corbyn after the no confidence vote, nor will it do so for Owen Smith’s campaign if he does not address the concerns of Labour members. [1]

The first thing Owen Smith can do to change this is to acknowledge Corbyn’s greatest achievement: building an enthusiastic activist base for the party. This achievement was only possible because of Labour’s previous failure to do so. To read some you would think that Corbyn’s support is largely made up of ex Trots or SWP members, but this is nonsense. It is similar to the support that the socialist Bernie Sanders received, and the rise of new left movements elsewhere. It is the activist base that Labour desperately needs to help counteract the influence of the media.

One very real reason why this base does not want to let Corbyn go is their fear that without him they will lose all influence. Corbyn’s nomination in 2015 was an act of generosity by some MPs, and members fear with justification that this will not be repeated. As a result, they believe any prospective candidate from the left will never be on the ballot. When I wrote earlier that the left within Labour would be in a better position after a poor general election loss in 2020 if that loss occurred under Smith rather than Corbyn, this point was quite justifiably made. Owen Smith could counter this fear by pledging to lower the number of MPs required to nominate a candidate for leader, or by some equivalent means to ensure that members can always vote for a candidate from the left.

Many of those opposed to Corbyn will be horrified at this suggestion, which is precisely why it would be a strong move for Smith to make. My impression is that most Corbyn supporters regard all the 172 MPs as essentially tainted by the antics of the original anti-Corbynistas. In that sense, my warning that the tactics of this group of overtly anti-Corbyn MPs would completely backfire has proved correct. Many members also see all those MPs as deeply sold on New Labour triangulation, and are reluctant to believe that only a year after the 2015 defeat and Corbyn’s victory, and because of recent events, that election strategy has become history. Smith should disown this election strategy explicitly, but by making it easier for a Corbyn successor to become leader again Smith will effectively be saying to members that they can always be in a position to prevent any future backsliding. If Smith wants Labour members to trust him, he has to show that he also trusts them in the future.

The other area where Smith needs to clarify his views is on immigration. At the moment he seems to be living in the same land as some leading Brexit campaigners: saying we need to stay in the EU single market but also that immigration in some areas is too high (although he has also condemned Conservative type controls). There is a real debate on whether Labour needs to advocate controls on unskilled migration to preserve its working class vote (see my short dialog with Martin Wolf here). As I suspect most Labour party members care a lot more about staying in the single market than they do about controlling immigration, it is important for Smith to signal where his priorities lie.

Smith has already outlined a series of measures on economic policy. There is a lot to discuss and a lot to like here, and I suspect it is not very different from what policy might have been under a Corbyn leadership. Which suggests an obvious move, which is for him to say that he would offer John McDonnell to continue as Shadow Chancellor. (See his newsnight comments on any offer to Corbyn.) If that position has already been promised to Angela Eagle in exchange for her stepping aside, then some equivalent offer should be made.

There is a common theme to the first and last points. To defeat the Conservatives, Labour needs to be a broad church. It has to have a strong, effective and largely united set of MPs, but also a vigorous activist base. (Labour membership rose substantially around 1997.) It needs to develop policies that can appeal to both left and right in the party, which has to mean both left and right being involved in policymaking. Smith needs to convince party members that he believes in that and can implement that to have chance of winning in September.

[1] Just to be clear, I think Labour members should vote for Smith whether he takes up these suggestions or not, because under Corbyn after the no confidence vote Labour are heading for at best a disastrous defeat in 2020 and at worst a split party.

Rebuilding a mass social democratic party?

For Labour Party members

I was expecting a pretty negative reaction to my last post from many in the constituency it was aimed at, and the most constructive thing I can do right now is to try and engage as best I can with those arguments. Let me start with this:

“we are re-building a mass social democratic party after a generation or more of atrophy. That is a huge gain for the Labour Party but it terrifies most MPs. Sorry, the days of doffing our caps are over.”

My response is the same as any decent social scientist: show me the evidence that this is what you are doing. It seems to me what Corbyn has done is build an activist base made up in large part of mostly idealistic, mostly young political activists, and I think that is a great and valuable achievement. What terrifies MPs, and me, is if this base gets delusions of idealism and grandeur, and saddles them with a leader who will lead the party into electoral irrelevance. If you think those fears are wrong, show me your evidence. Not your hopes, but a concrete and realisable plan.

What I see so far is largely a government that acts as if it was unopposed, or that provides its own internal opposition. The exceptions are generally not the result of Corbyn. Look at the first item in the list provided by Liam Young here: the abandonment of cuts to child credits. This was not the first major achievement of a new mass social democratic party, but of opposition from members of the House of Lords and the misgivings of some Conservative MPs. Iain Duncan Smith did not resign because of pressure from Labour!

There is a contradiction here that Corbyn supporters fail to acknowledge. In the UK to have any chance of building a mass social democratic party you need a parliamentary party to provide a voice that will be heard. That means MPs on your side, not against you. The adoption of a sensible fiscal rule - another item on Liam Young’s list - was an example of that happening, but any attempt to repeat that now would result in just endless discussion of internal divisions.

As Liam Young also says: “Most importantly all of Labour’s recent success has come at points where the leadership has been strong and the party united. Recent talk of splits, coups and dissent is unhelpful and only weakens the Labour party’s position.” I agreed with that when I wrote this. If the current leadership had succeeded in uniting the majority of Labour MPs behind a consensus policy programme that would have been a powerful force, but it failed. It makes no sense to extol the virtues of unity only when it suits you. 

What makes me really sad is the contempt that some members seem to have for Labour MPs. I can think of some that fit the caricature frequently painted of diehard triangulating Blairites, but they are far from the majority. I agree that collectively Labour MPs became embroiled in a failing electoral strategy before 2015, but you change that by persuasion through evidence and hopefully example, not by casting them as the enemy or as forever ‘lost’. Most of all, they are not some kind of inconvenience that can be ignored or who will collectively come to their senses if the membership continues to vote for Corbyn. They are an essential part of the means of achieving a mass social democratic party: that is why 2016 is not 2015.

In short, if you still think Corbyn can succeed in forming a mass social democratic party without the support of MPs, show me your plan of how it will be done and the evidence that it will work. In 2015 I could, unlike many commentators in the media, imagine that it was possible that Labour MPs could be led from the left with the right leadership. Corbyn earned the right in 2015 to try. But the evidence since then shows that this is not the right leadership. I’ll go with a good plan, but right now I do not see any plan at all.

Labour: times change

For Labour party members

When it looked like Jeremy Corbyn might win the 2015 leadership election, I was asked to both endorse and condemn. I did neither. I criticised one of his proposed policies, but I was also highly critical of the way Labour had been run over the previous 5 years. It was a superficial focus group style of policy making that led to decisions like not defending the Labour government's fiscal record, which ultimately was an important part of the general election defeat.

For a Corbyn led Labour party to work, the new leadership had to bring on board the majority of its MPs. There would always be a minority - I called them the anti-Corbynistas - who would oppose Corbyn come what may, but it is a gross error to imagine all the MPs who did not vote for Corbyn were of this type. Some were prepared to work with him, and some were content to remain on the sidelines, pursuing their own particular interests.

I think many in the new leadership understood this, and attempted to involve MPs in key decisions. One successful example which I was involved in was the adoption of a new fiscal rule which would have avoided both 2010 and 2015 austerity. But ultimately this process failed. The rock that sank this ship was the Brexit vote: whether it could have succeeded otherwise is for another day.

There is a degree of unity between the Corbynistas and the anti-Corbynistas about the vote of no confidence: both agree that it was inevitable. But to concede this means that you think the Corbyn project was about remodelling the party over the long term, rather than trying to win the 2020 or 2025 elections. I do not believe most Labour party members would endorse such a project.

If this is true, then what these members need to resolve is whether it would be possible for Corbyn to successfully lead the party in 2020. One posibility after a 2016 Corbyn's victory is that those who expressed no confidence accept the verdict of members and start cooperating with the leadership. This is the possibility discussed here by Steve Richards, but it seems close to wishful thinking. The trust that is required to make that happen has disappeared. Again we can debate at length whose fault that is, but that debate should have no impact on how people vote. What is done is done.

What seems totally clear to me is that given recent events a Corbyn led party cannot win in 2020, or even come close. I was highly critical of the anti-Corbynistas who wanted to argue that their antics were having no impact on public opinion, so it would be absurd for me to pretend that people would elect to power a Labour party that had voted no confidence in its leader.

This has to be the bedrock on which voting decisions in the coming leadership contest should be based. Once you accept it, then various things follow almost automatically if Corbyn were to win again. One is that the likelihood of a split is strong. History tells us that it takes only a few to make this happen, and if a few think they will lose their seats anyway they have nothing to lose. Even if no split occurred, the constituency wanting to vote for a committed pro-European party of the centre-left is likely to remain strong while the Brexit negotiations continue. History also tells us that a divided left in a FPTP system cannot succeed, a fact that is built into the DNA of the Conservatives.

Another consequence of a bad defeat in 2020 is that the left within Labour will again lose its influence for a generation. Defeat and a divided party will not be the springboard on which a successor to Corbyn, such as those mentioned by Justin Lewis here, can win. Ironically their chances if Owen Smith wins in 2016, then reverts to the pre-2015 strategy and fails are much better. Keeping Corbyn until 2020 simply delays the date of his departure, with nothing achieved and much lost in the meantime.

The concern that most party members about Owen Smith is that, once elected, he will slip back into the disastrous form of right wing appeasement that led to Corbyn's election last year. Smith's support for Trident adds credence to that view. But there are important reasons why this may not happen.

The political landscape after the Brexit vote has changed substantially. May's cabinet appointments effectively put the Brexit side in charge of negotiations. That might be clever politics by May as far as her position in the Conservative party is concerned, but it is bad for the UK. Smith can provide a convincing pro-Europe opposition to that, which has to include headlining the benefits of immigration. This position will be supported by most of UK business, which cannot trust the Brixiters with looking after its interests. Labour will no longer feel tempted to temper policies to avoid offending 'business leaders'.

The other main area, besides immigration, where past Labour appeasement was so damaging was austerity. As I argued in the New Statesman, 2015 austerity - cutting public investment when interest rates are very low - has now been disowned by senior Conservatives. 2010 austerity - fiscal contraction rather than expansion in a recession where interest rates are at their lower bound - may still happen in a Brexit based recession. In these circumstances it is difficult to imagine that Smith would endorse this austerity, but he could confirm this by commiting to follow John McDonnell's fiscal credibility rule.

Those who voted for Corbyn only a year ago will naturally ask why they should, only a year later, change their minds. One important point is that the 2015 vote itself changed things: any leadership now knows it ignores its membership at its peril. But in addition the hopes of many of those who voted for Corbyn, which is that enough of the parliamentary could unite behind him to form an effective opposition and a potential government, have proved false. If that reality is ignored or wished away, the implications for those who oppose the current disastrous and incompetent Conservative government will be devastating.