In today’s Guardian, Jonathan Freedland’s column on the Miliband brothers ends by outlining the weaknesses that could undermine their campaigns to become leader of the Labour Party. David, he writes, has not sufficiently distanced himself from his support of the invasion of Iraq and from concerns about the treatment of British residents by foreign intelligence agencies.
Freedland claims that Ed’s problem is that he has not given sufficient thought to why the deficit ballooned on Labour’s watch. The answer is so glaringly obvious, yet Ed hasn’t articulated it, for the simple reason that it breaks the greatest political taboo of the past 30 years.
In the low tax, low pay, deregulated market environment that New Labour sought to create, it is simply not possible for the majority of people to maintain the standard of living to which they have become accustomed for the whole of their working life without some support from the state.
Unwilling to contemplate raising taxes for the better off, yet wanting to help the poor, New Labour sought to square the circle by borrowing the money, a short term solution which, rather than requiring today’s big earners to pay their fair share, put the prosperity of future generations at risk.
This is the last great taboo in British politics – no-one dare suggest to the electorate that, if you want good public services, free at point of use, efficient and efficacious, then you have to pay for them through taxation.
Instead, for the past 30 years, politicians of all parties have suggested that you can pay less tax and have better public services. Everybody would like a world-class health service on the cheap, but, once elected, the pressure to deliver can bend a party out of shape. New Labour’s troubles with the rising costs of PFI are mirrored by the massive subsidies that the public continue to pay to rail companies that were ‘privatised’ under the Tories.
The reality of low taxation is that public spending has to be underwritten by massive borrowing and, in these chastened economic times, the need to service that debt threatens the state support system that millions of people will soon be forced to rely on.
The battle for the Labour leadership has been characterised in the past few days as a battle between New Labour and Old Labour. The truth is that both have passed their sell by date. There is very little appetite among the electorate for the return of Clause 4 to the party constitution. Yet nor do voters feel intensely relaxed about people getting filthy rich – quite the opposite.
Whoever emerges as leader of the Labour Party, their ability to break with the past and begin to rebuild Labour’s support could hinge on a willingness to overcome the greatest taboo of the past 30 years and tell the truth: in order to have good public services, it is necessary for each generation to meet their own needs through taxation and that business can only rely on a well educated, highly motivated workforce if they themselves have paid a part in funding its creation.