‘Now the very bounds of Britain are laid bare, and wonder grows where knowledge fails.” (“Nunc terminus Britanniae patet, atque omne ignotum pro magnifico est.”) Tacitus was writing of the Roman invasion of this country 2,000 years ago. Unlike Brexit and post-2010 austerity, that invasion was not an act of self-harm but inflicted from without.
All these years later, the bounds of Britain are most certainly being laid bare. In his latest Inside-Out political newsletter, the former Financial Times commentator Philip Stephens makes no bones about it: “Britain is trapped in a spiral of decline. The economy is locked into low growth and high inflation. The public realm is in an advanced state of breakdown. And the nation is looking on incredulously as the Tories prepare to fight each other over the spoils of opposition.”
While other commentators hedge their bets, Stephens sticks his neck out. “Forget coalitions. Keir Starmer is heading for a landslide,” he writes. “Never has a governing party betrayed such contempt for voters it will soon ask for another term.”
At this point, a vivid memory recurred. I was at Ascot the day before the 1992 election with the economist Roger Bootle. The prospect of a Labour victory after 13 years of Thatcherism and the recession of 1990-92 was considered so certain that the bookmakers were offering 6-1 against a Conservative victory.
Roger and I have kicked ourselves ever since that, as seasoned racing men, we did not take advantage of those sensational odds. And, of course, John Major won the following day’s election.
There were several explanations for Labour’s defeat. Many blamed it on the putatively triumphalist tone of the party’s Sheffield rally that week, others on a disgustingly anti-Kinnock front page in the appalling Sun “newspaper” on election day. My own view is that it was down to the cumulative success of then Tory chairman Chris Patten’s “Labour’s tax bombshell” campaign.
Which brings us back to the present day, and the ultra-cautious approach to tax commitments of Starmer and his shadow chancellor, Rachel Reeves. After what happened in 1992, this is understandable, even if it frustrates the hopes of the many who wish to see the damage of austerity repaired fast.
Even so, critics are pointing to potential holes in this strategy, and arguing that the ultra-cautious figures still don’t add up; thus, though rightly discredited, this shambles of a Tory party could still try its luck with a “tax bombshell” scare.
Labour is planning to quell fears with a pledge to produce the highest “sustained growth” in the G7. In which context – yes, here it comes – Brexit rears its ugly head.
Now, Neil Kinnock, as a former Labour leader who lost elections, has been admirably reluctant to intervene publicly over Starmer’s approach to Brexit and the election. Before going further I should like to register my opinion that, lost elections or no, Lord Kinnock played a heroic role in saving the Labour party from itself in the 1980s. He did a lot of the hard graft from which Tony Blair in due course benefited. And, by the way, I very much doubt whether he would have made the dreadful mistake of supporting the invasion of Iraq. Also, when becoming a European commissioner, he appreciated just how important to this country’s economy and its values was membership of the EU customs union and the single market.
He was recently questioned at a UK in a Changing Europe event about his views on current policy and said: “I worry – with great loyalty – about how it will be possible to achieve the ambition, or progress towards fulfilling the ambition, of a sustained high economic growth rate in the absence of our engagement in the single market.”
He added: “It is very difficult to see how you can attain and sustain growth rates … by excluding ourselves and continuing to do so from a big prosperous market.”
My concern for Starmer and Reeves is that by not grasping the nettle and making a big election issue of the catastrophe of Conservative Brexit, they are inhibiting their chances of achieving the “sustained growth” which would provide the revenue that would alleviate fears about a tax bombshell. Kinnock evidently feels the same.
I repeat what I quoted in my last column – the analysis of Trevor Greetham of Royal London: “While there wasn’t a ‘Brexit dividend’ there would certainly be a ‘reversing Brexit’ dividend.” Tax and spending plans could be based on a significantly larger economy, with the approval of the Office for Budget Responsibility. That would surely ease Labour’s path to power.
