Thursday, 20 January 2011

Ed Balls: Let Tories Tremble

I never believed Ed Miliband was going to lead the Labour Party into a glorious socialist future, but I was disappointed when Alan Johnson was appointed shadow chancellor. I was then and remain convinced this had more to do with the internal balance of forces in the party and the desire to squash the 'Red Ed' label than anything else (see here). With a political career not exactly synonymous with economics, this decision didn't show Ed's leadership in its best light.

But now Alan Johnson has stepped down for 'family reasons' and Ed Balls has been shuffled into his position. Good.

Of the Labour leadership candidates during last summer's contest, only Balls and Diane Abbott offered a decent alternative to the 'slow and shallow cuts' consensus of the other three. And of the two Balls offered a comprehensive and serious critique of Tory/LibDem economic policy. In my opinion, Abbott's shopping list of left demands were worthy but lacked the necessary grasp of the issues. It was also obvious the Tories feared Balls and his Keynesian agenda more than any other contender.

What does this mean now for Labour's economic policy? Ed Miliband has said the new appointment will not effect his economic policy. This is not, strictly speaking, true. The Miliband/Johnson
orientation (it would be mangling the language to call it a policy) said more things about investment and growth than the Tories, but were fundamentally in agreement with them on the necessity for cuts. Balls's strategy boils down to placing more emphasis on the former than the latter - his Bloomberg speech does accept a role for cuts, but it is entirely swamped by the argument for economic activism. Luckily for Ed Miliband, policy up until now has been so vague that Balls could take it in a more Keynesian direction while allowing Ed to save face by pretending this is what he favoured all along.

As far as I'm concerned, Ed Balls doesn't go far enough. There is absolutely no reason for cuts. Period. As Paul Mason explains in his "interview"
with Marx, this crisis is one part a crisis of investment. It follows if private capital in its totality is fighting shy of investing, the state has to step in to get things on the move. The multiplier effects of creating jobs and stimulating demand creates conditions more conducive to private investment. Cutting only worsens the climate and makes the private sector-led recovery Osbourne and Dave are pinning their hopes on fanciful and utopian, and their actions irresponsible and dumb. As the world's economy is jittery, as Portugal, Spain, Italy and Belgium aren't looking good and the unwelcome spectre of currency wars is frightening economists and chancelleries, investment at home is the strongest inoculation possible the UK economy can take against a global economic chill.

That said, Ed Balls as shadow chancellor is a step in the right direction. With a strong advocate for investment over cuts in one of the most influential political positions in the land, the hand of the labour and anti-cuts movement has been strengthened ahead of the fights to come.

16 comments:

Lonely Nobody said...

Your glorification of the Labour Party is misguided.

It's not what it once stood for; an example is the lack of anger towards current connection between ASDA, Marks & Spencer openly supporting the Tories. Even worse they are advising them on changes to Employment Law..!!

All major UK Political Parties are at the mercy of those that pay the bills for General Elections Campaigns. The people that have the £ therefore have the power these being the same one's that 'bleed the ordinary population dry'.

Labour's policy on what to do around Britain's growing connection to Illegal Narcotics doesn't exist.
Yet, this connection hurts the working class poor the worse / traditional working class locations worse.

Ed Balls likes the 'limelight' but even as a Minister he was all mouth. Better selection in his new role but the days of major UK Political Parties doing what's best for the population has long gone.

If Rupert Murdoch decides that Labour has 'the correct plan' for the UK then The Sun becomes friends with them again..!!

Am not ignorant about Politics but why should I be bothered to vote when what am being told when by Barbers, Street Sweepers & Supermarket staff how they want the UK to be isn't being touched by those in Parliament.

Phil said...

Glorification?

Phil said...

If George Osborne were to be replaced by a One-Nation Tory of the old school, this would be a cause for massive rejoicing - even among those of us who loathe and detest One-Nation Tories.

And if a know-nothing Blairite like Johnson is replaced by a rightish Keynesian like Balls... of course this is a cause for rejoicing. Get a grip, Ludd.

ModernityBlog said...

"this decision didn't exactly show Ed's leadership in a favourable light."

Phil,

I am perplexed and this is a genuine point.

Why is it that ex-Trots in the Labour Party seem to dance around criticising the LP leadership?

If I read you, Dave Osler or even Newman, instead of saying the LP leadership are right-wing shite and utterly useless politically, instead of that I find understatement, careful wording and opaque criticism.

Are you all worried about being expelled ?

I don't know, but there seems to be very little bite in the criticism which **should** be aimed at the Labour leadership?

Is it conformity, fear or a desire not to stick out too much?

Why do so many ex-revolutionaries give out muted criticism?

Phil, why?

I see it, but can't explain why it seems to occur....

Boffy said...

Mod shouldn't tar all ex-Trots with the same brush. I stood up at a Full County Council Meeting just before the Elections in 2005, and repeated the old joke about in 1997 I had been waiting 18 years for a Labour Government, and now 8 years later, I was still waiting. I was not the only Labour Councillor who openly criticised the Labour Leadership, or who quoted Marx in support of my arguments on many issues.

To Lonely, I'd say that if your vision of what politics amounts to is just your requirement to vote periodically, I can see why you'd be depressed about the lack of choice of socialist parties to vote for. But, traditionally if you want something, be it a socialist party or a house, somebody has to actually do the work of building it rather than everybody sitting round complaining that nobody has. As I and Phil, and many others have argued the history of the last 150 years shows that the sects are capable of building nothing, and that socialists have to commit themslves to building that Party alongside the workers who have already done most of the job, even if we are not yet happy with its specifications.

To Phil, the vast bulk of the deficit is accounted for by the money pumped into the economy after 2008 as an emergency measure. Within the confines of Capitalism - and I both see no possibility of the LP any time soon proposing going beyond, or any chance of some Left-Wing party growing like the beanstalk on the basis of making such an argument - it is not credible to argue for keeping in place the level of stimulus that was only introduced as an emergency. From an economic perspective within Capitalism the deficit does have to be tackled, but the question is how, and over what time period. Your argument, which mirrors the argument I have been making, and as you rightly say Paul Mason, and many respected economists, as well as even various business forums, is that the Tories economic policy is actually counter-productive to the interests of Capital, because it is almost certain to cause a crisis, in which Capital Accumulation will fall, and consequently profits will decline. Of course, what those business fora, and the bouregois economists really want to see, is not NO CUTS, but no cuts that threaten an economic collapse, and the interests of their business.

Socialists have to argue that for now, the kind of Keynesian measures the Labour left and otehrs are advocating can work, and are a mosre sensible solution within the limits of Capitalism, but can neither work in the longer term, or provide workers with a real solution to their problems. The latter can only come when workers themselves become the bosses, and they shouldn't wait for some future revolution to bring that about, but start work on it now, by taking over their companies, and setting up Worker Co-ops.

modernity said...

"Mod shouldn't tar all ex-Trots with the same brush."

I didn't.

Please, make an effort not to read my contributions too literally, as it fails to address the general point I am making.

I can think of at least four blogs (there may be dozens more but I haven't read them), written by ex-revolutionaries, ex-trots, and each one of them seems to go out of their way not to make any pointed criticism of the LP leadership.

That's not to say there is no *any* criticism, but is often so opaque and guarded that it hardly counts.

It is a curious phenomena and I am wondering why?

Benjamin said...

I am not sure what possessed Miliband to appoint Johnson as Shadow Chancellor. This is precisely the time Labour needs to do some real spadework on economic issues, undertake some deep thinking, and take the fight to the Tories. The painful videos of Johnson being interviewed on the economy are just proof that he was simply not up to the job.
Unfortunately though, I very much doubt Labour will significantly move away from neo-liberalism in reality; even to rebuild the scattered remains of British social democracy will take a significant turn left away from New Labour. So far we have only had tentative steps, and the odd murmur.

Take a look at how much they have agreed on the Tory cuts to already paltry welfare benefits; I suspect that may just be the tip of the iceberg.

Lobby Ludd said...

Phil:

"And if a know-nothing Blairite like Johnson is replaced by a rightish Keynesian like Balls... of course this is a cause for rejoicing. Get a grip, Ludd."

Not me Guv. I think you are referring to 'Lonely Nobody'. I may be a lonely nobody, but I am not 'Lonely Nobody'.

Lobby Ludd

ModernityBlog said...

Phil,

Could you remind your readers of Ed Balls great political achievements as a policy adviser and politician?

ModernityBlog said...

PS: And later on, perhaps you could tell us about who were the architects of New Labour's push for PFI? And Ed Balls' role?

harpymarx said...

This former-Trot and LP member thinks Balls will not deliver, I hope he will be able to land verbal punches on Osborne et al. But seriously, I really doubt it!

Balls is part of the problem not the solution. You can't conveniently just brush Ball's NL minister stint under the carpet. There was so much he coulda and shoulda done but didn't. Oh, and the shite he spouted re migrant workers at the start of the leadership contest was racist.

Balls made that Bloomberg speech possibly to garner votes from the left as he was now "Keynesian Balls" and he got votes. Contrast that to last Saturday morning when he goes into line with Mister Ed's view on the deficit that it has to be halved in this government.... And I doubt he talking about cutting Trident, progressive taxation, withdrawal of troops from Afghanistan etc.

And yes, he's better than Johnson but anyone is better than Johnson a donkey probably knows more about basic economics than the former Postman Pat of the trade union bureaucracy.

Phil said...

Interestingly in his recent book, Beyond the Crash, Brown didn't see himself as a neoliberal, Benjamin. The way he justifies his love for flexible labour markets, privatisation and crap like that is contextualising it in the context of a global economy governed by Keynes-tinged institutions.

The whole Alan Johnson debacle and willingness to go along with benefit cuts is scandalous, but not illogical. Sad to say bashing welfare claimants is no vote loser in this country,

Phil said...

Mod, you're being disingenuous. It's pretty clear in the post above why Balls appointment affords the anti cuts and labour movement new political opportunities.

Louise, it didn't take long for Balls to move on from his comments on Saturday. Interviewed this morning on BBC News he made it clear his Bloomberg Speech spelt out his orientation, while saying it was no different to the Darling plan to cut the deficit in half in four years. What we have is a change in orientation masked by the rhetoric of continuity.

modernity said...

"Mod, you're being disingenuous."

Phil, might I suggest that if you're going to be a proper academic and make understated criticisms that you avoid accusing people are being disingenuous?

I might have a different interpretation on things, but that isn't disingenuous, unless you wish to bring along with you the worst aspects of Trotskyist political pronunciation?

I thought you would trying to leave that behind?

But back to the point, I think that many NON-LP people find the temporary amnesia of LP's past deeds (PFI, market "reforms", etc" rather galling and not convincing....

Phil said...

Once again, Mod, I don't see the need to fixate on matters that are irrelevant to the matters to hand, especially when there's plenty of material in the archives critical of Labour's record from before I was a member and since. End of.

modernity said...

History is always relevant, the history of the Labour Party making PFI their own.

The horrible consequences of PFI.

Voters, unlike Labour Party members have a longer memory, which is why this rather "understated! go into a vital i" approach is doomed to failure, outside of the party.

As Lincoln said....