The London Economic

The Left has Plenty of New Ideas on the Economy

On the economy, it’s clear why the right claim the left have run out of ideas. Under Miliband, Labour were more like a lost battalion playing catch up than real opposition, unanimous in support for austerity (although of the lighter variety) and feeble in refuting the ludicrous assertion that Brown’s fiscal policy somehow contributed to the global meltdown that enveloped international markets. The crash exposed neoliberalism as crisis-ridden, and in the vacuum where alternative, progressive ideas should have emerged, British centre-left political thought had nothing of value to say. With such a crisis in confidence, it’s no wonder the public say they trust the Conservative’s more.

Whether Corbyn can survive as leader is another story. What isn’t disappearing overnight, however, is a reenergised Labour Party membership realigned firmly to the left, devoutly opposed to the winning economic narrative of our day; austerity, that vaguest of terms, veiling the poorest groups shouldering the burden of a frugality in state spending. Yet regardless of its bias, party loyalists are but a fraction of the electorate, most of whom buy into the government’s dubious family analogy: in hard times we must tighten our belts and live within our means – or so it goes.

For the left to be an electorally credible force on the economy, and win over a tax-adverse general public unwilling to engage in convoluted detail, or feel outrage beyond their own bank account, a two pronged approach is needed. First, it must forensically unravel the many failures of austerity as a means of long term growth, and second, in it’s place paint a picture of a more sustainable, strictly regulated capitalism of the future.

Corbyn and co are great at knowing what they’re against but opposition alone never made a compelling case. Being ‘anti-austerity’ is about as relevant to the average voter as being ‘anti-hegemony’. Labour have made moral outrage at those targeted by cuts the central component of their argument, when challenging the legitimacy of austerity itself should be the priority. Academia is brimming with evidence to suggest it’s now a discredited approach, dropped long ago by prospering economies like Germany and America (nicely summarised in Nobel prize winning economist Paul Krugman’s work). Research findings should be pillaged and reframed in layman’s terms, helping people demystify austerian economics as an obstacle to growth rather than an enabler.

The left have a habit of appealing to the electorate on the basis of creating a fairer society; a naivety in a society still reeling from instability, where furthering your lot reigns supreme over any collective advance forward. Calling inequality a sickness within our system may be true but it does little to captivate those immune to its ravages; broadening a leftist movement relies on disproving consensus and introducing new ideas, bolstered by a solid intellectual grounding.

Labour have appointed Thomas Piketty as an economic adviser, whose groundbreaking findings on inequality have the potential to change our relationship with tax. He proved that the wealth we inherit will always grow faster than the wealth we earn. Ultimately, he suggests, we’re on a collision course for another extreme financial crisis. His solution? A 15% global tax on inherited wealth. Which, in the eyes of the status quo, may appear extreme. But when you combine political reason with academic heft, it’s difficult to argue with policy that rebalances a society headed in the opposite direction.

The left must also be the mouthpiece of the future, declaring a vision of capitalism’s potential, that isn’t shackled to the short-termism of unimaginative governance. Paul Mason’s idea of post-capitalism, where in the age of abundant information, the states real job should be to nurture and expand the rise of collaborative production, is about as progressive as they come. Parallel currencies, like cooperatives, could dissolve traditional market forces that allow huge monopolies to reign. If the left were to articulate a vision like this, people could imagine a life free from what David Graeber terms ‘bullshit jobs’. We could work less hours and live more – who would really argue with that?

And with climate change emerging as the single existential threat of our time, the left could put it at the heart of policy-making – using scientific consensus to reveal the impending cataclysm our current government so foolishly ignores. Instead prioritising our society on it’s survival; breaking free from the stranglehold of our energy sector and building renewable infrastructure in it’s place.

Good ideas on the economy are certainly out there and, on paper at least, look achievable. But crucially they’re at odds with the financial interests of our elite; always patrolling the confines of mainstream opinion, so ideas bubbling up from the murky depths are kept out of sight. In this rigged game, the daunting task ahead is cutting through the naysayers and their vitriolic noise and providing a case to the public so compelling only a fool could reject it.

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