28 March 2013

A disastrous day for the Labour Hard Right

If you're a Guardian reader you couldn't really have missed the news that David Miliband, the Denis Healey (or maybe the Roy Jenkins) of post-Blairite Labour politics, has decided to stand down as an MP to go and work for an American charity called the International Rescue Centre. This news was the top story on the Guardian website for at least half of yesterday, which gives you some idea of the priorities of the Guardian news editors.

I had some sympathy with David's interview with Krishnan Guru Murthy on Channel 4 News where he explained that the main reason he was stepping down was to avoid an ongoing "pantomine" whereby every comment he makes on national politics is interpreted as a coded attack on his brother Ed. That's true, and this move gets David completely out of British politics and gives him a chance to do something completely different - and I'm sure he'll do very well. However, it's important to realise that the reason that David's political commentary has had a "pantomine" aspect to it is because his more zealous supporters - the Blairite Labour Hard Right, known fondly on this blog as "LINO" (Labour In Name Only) - have chosen to raise the stakes to that level.

For two and a half years now the LINOs have been in a state of shock, still unable to accept that David lost. How could it have happened?
Didn't David have the best set of ideas for taking Labour forward? [In my view, no.]
Didn't he have the best funded campaign? [yes - but that encouraged a complacency which was, in the end, fatal.]
Didn't he have the best experience for the job? [yes - but that often counts for little in a leadership ballot. Look at (e.g.) David Cameron vs David Davis in 2005.]
Didn't he have the endorsement of almost all the Labour Party's "big hitters" (Blair, Mandelson, Johnson, Darling, Blunkett, etc. etc.) [yes. Read those names back to yourself and you'll see what the problem was... he wasn't change, he was more of the same.]
Wasn't he stabbed in the back by his dastardly brother?

This is the question it comes down to in the end. "How dare Ed Miliband stand against the anointed elder brother!"

The Labour Party is a strange place for primogeniture to find a foothold as the main ethical principle for allocating a position of power, but that's the principle that LINO are invoking here. Ed shouldn't have stood against David because he's the younger brother.

To which my response is: mile-high bullshit! Any sitting Labour MP had the right to stand in that election regardless of who their brother was and what position in the birth order they were in. We might find it surprising that the Miliband brothers couldn't agree some kind of joint campaign which would have meant only one of them stood (for example, David could have stood, supported by Ed, with the promise of the Shadow Chancellor position - which Ed would have been brilliant at - as a reward). But obviously there was a fundamental difference of political opinion which meant that Ed wasn't comfortable with that. And so, he felt that it was more honest to have an open contest. And why not? It was the most honest thing to do.

And it was all above board. Ed didn't stab David in the back; if anything, he stabbed him in the front. (H/T Chris Brooke on this phrase).

But Ed was a huge underdog and it's a testament to how badly run the David campaign was that Ed managed to get anywhere near him on votes, let alone win. Once again the "bad loser" tendency in LINO is huge when the manner of victory is mentioned. We hear "Ed won with union votes". Yes he did. Did any of these people look at the election rules? It's a tripartite electoral college. Ed took the strategy of trying to maximise his vote in all three segments, whereas David only bothered with two. And apparently he wasn't even that bothered about the PLP... according to Mehdi Hasan and James MacIntyre's biography Ed, David spent very little time over the run-up to the summer recess meeting MPs to get extra support - he just assumed his Big Name status would deliver. Whereas Ed, not the most natural Strangers Bar visitor, was apparently there all the time pressing the flesh.

In the end, David Miliband was The Entitlement Candidate. He felt he didn't need to try very hard to win the leadership election because the arithmetic and the resources of the contest were so heavily weighted in his favour that he was a shoo-in.

Whereas Ed Miliband was The Grafter. It was a long shot from the start but he believed from the get-go that if he put the hours in and made his case he could win.

Given a choice between those two strategies as a template for Labour's 2015 General Election campaign, I know which one I'd choose. I actually think Labour is now further ahead in the polls with Ed as leader than it would be if David were leader. David's personal ratings would probably be better than Ed's but David would have failed to map out any kind of strategy for opposing the ConDems and putting "Clear Red Water" - those all-important dividing lines - between Labour and the Tories.

The "pantomine" and "soap opera" which David Miliband has resigned to put a stop to, started when Ed was declared winner by a narrow margin in September 2010. There was a large group of LINOs - some of them influential (or at least semi-influential) journos - who just couldn't accept the result. And so it was toys out of the pram time... because they couldn't win in a straight fight they hoped to destabilise the Ed regime to the extent that he would step down before 2015. The most ludicrously blatant example of this strategy is the Telegraph blogger Dan Hodges, who attacks Ed in the most clumsy and flailing manner in at least 80% of his columns. But there are others: John Rentoul in the Independent, a misanthropic Tory masquerading as some kind of Labour supporter, is the obvious example.

Perhaps the most insidious attempt to undermine Ed has come from the Guardian's Political Editor Pat Wintour and Chief Political Correspondent Nick Watt. Wintour and Watt have spent large parts of the last two and a half years coordinating a range of Blairite has-beens to launch thinly veiled attacks (or in some cases not even thinly veiled) on Eds Miliband and Balls - mainly arguing that the Eds lack credibility on the economy (even though if one compares Ed Balls's predictions for the economy in 2010 with George Osborne the score is something like Balls 10, Osborne 0). The Wintour/Watt strategy came fairly close to destablising the opposition completely at the end of 2011 and start of 2012 when biased media reports of Cameron's so called "veto" had briefly given the Tories a lead in the polls. In the end Ed was saved by the "omnishambles" Budget, after which Labour opened up a 10-point lead over the Tories which has remained more or less around that level ever since.

It's not clear to what extent David Miliband was involved in these destabilisation efforts, if at all. He played little direct role beyond the odd article here and there calling for Labour not to retreat to its "comfort zone" (although arguably it is Blairism which is the real "comfort zone" which needs to be avoided.) I'm inclined to think that his role was that of an interested onlooker... if Ed had been forced to stand down a la Iain Duncan Smith, David would probably have thrown his hat into the ring again. But crucially, he could not have afforded to have been seen as the man who destablised his brother's leadership... that would have made him look like the guy who knifed his brother in the back, and LINO would have probably abandoned him for another candidate.

But who would that candidate be? One of the reasons that LINO, Progress and all the rest are fighting such a desperate rearguard action at the moment is that they have no obvious Blairite challenger in the event that Ed Miliband falls under a bus next week. The best they can do at the moment is Yvette Cooper, who is only semi-Blairite at best. The two most senior dyed-in-the-wool Blairite shadow cabinet members are Liam Byrne and Steve Twigg, who would be laughable choices for leader (so laughable in fact that they are a liability to Labour and should both be ditched asap). Jim Murphy at Defence at least gives an impression of competence but is too lightweight a figure to challenge for the leadership. And there have been few if any Blairites in the new crop of 2010 MPs.

In short, the fall of David Miliband is just one more staging post on the slow extinction of Blairism in the Labour Party: and for that we can be grateful.

17 March 2013

Cyprus: Beginning of the end?

Apologies for a very long silence here... been ridiculously busy with work, partly because it's the lead-up to the Budget. Hopefully I should have a lot more time after Easter and will be getting back to regular posts.

There is a lot to catch up on - Eastleigh and UKIP, the Pope, plottings against Dave Cameron... but right now, the most important story appears to be the Cyprus bailout - the first bailout where ordinary savings account holders (as opposed to large institutional investors) have taken a haircut.

And it's a relatively large hit: a 6.75% savings tax on deposits under €100,000, with 9.9% on deposits over €100,000. (It's being described as a "one-off" savings tax... but then all the other bailouts were meant to be "one-off" and the European banking system has gobbled them all up and is asking for more. As long as austerity is shrinking the economy, there will be plenty more need for bailouts.

If the economy lasts that long... my feeling is this could be the beginning of the endgame. Savers in other southern European countries (and probably some of the northern European countries as well) will be rushing for the exit doors. If the ECB can ride roughshod over small depositor insurance schemes to grab large chunks of people's savings, then - given that most savings interest rates are close to zero anyway - what's the point in having money in the bank? At which case we get Northern Rock x about £1m.

Any of you kids remember Space: 1999? In the pilot episode, "Breakaway", Nuclear Waste Disposal Area 1 burnt itself out quickly, with little collateral damage. That was Northern Rock, if you like. Nuclear Waste Disposal Area 2 was thousands of times larger than 1 - and when that blew up it took half the moon with it. Well, the European banking system is Nuclear Waste Disposal Area 2. And the Cyprus bank savings raid could well be the fuse that sends the whole system up. Time to stockpile tinned food again...