The publication of the SMF paper "Osborne's Choice" is important, because the paper advocates an approach to growth and deficit reduction which takes us away from the current debate about total spending into the much trickier area of national priorities. 

Because it is so admirably clear, it exposes the political challenge for parties in an austere era.

Ian Mulheirn argues that even after the current government has completed their term there will need to be a further squeeze on the public finances of some fifteen billion a year, even as achieving their current targets carries a significant risk to the overall economy. To counter these twin risks, Ian suggests that the Government bring forward these £15bn of savings to today, three years before they are "needed", and use the money saved in those three years to fund programmes that will more directly stimulate the economy.

What Ian is effectively suggesting is making deeper current spending cuts now, using the money generated from these cuts to fund capital spend today, then stopping the capital spend when budget targets need to be met. He's saying Medium term deficit target > Securing growth to 2015 > Immediate deficit reduction > Particular tax breaks and universal benefits.

In other words, he's setting priorities.

I instinctively agree with those priorities, but any politician would take a sharp intake of breath when confronted by the list of immediate cuts proposed. The programmes to be sacrificed are: Halving higher rate tax relief on pension contributions,(the cornerstone,  at £6.7bn), capping maximum ISA holdings at £15,000, (£1bn) Rolling Child Benefit into the existing tax credits system (£2.4bn) Cutting Winter Fuel Payments and free TV licenses to better-off pensioners, (£1.7bn), free bus travel for the over 60s (£1bn) and all that still leaves him a bit short!

Making these cuts will pay for a multi-billion pound capital expenditure fund. These capital expenditures, having a higher multiplier effect than the programmes they replace, will therefore have a directly stimulative impact on the economy.

There are some technical issues with this approach. Do we have £45-60 billion of capital programmes to pour money into now, and would they be wise programmes to support anyway?

But even if you decided to go for a portfolio of temporary goodies instead- a time limited £100 tax rebate voucher, more capital spend or a higher personal allowance, the principle would be the same. Shift resources to higher multiplier spend now, so economy is in a stronger position when you squeeze further.

It's a bit like a dieter deciding to do more exercise and switch their calorific intake from fats to proteins as they gradually reduce their overall food consumption. Just like a diet, it might be good for you, but it's unlikely to fill anyone with joy.

Here lies the real problem. The SMF paper may be sound economics, but it's damn hard politics. Just look how the Daily Mail reported the pamphlet, complete with disingenuous quote from Ros Altman (Nothing new there, at least).

Any politician who embraces this agenda is going to be facing some pretty significant head winds (I can see it now : "Let pensioners freeze to pay for wind farms, says Labour's Sen", accompanied by a picture of me at my most porcine.)

So how do you sell such a mission?

I think the first step is to recognise that the age of popular politics is dead for a while. It's not a question of who has the most popular policy agenda. It's who has the least unpopular plan that deals with the problems we face.

The choice the electorate is going to have is not between milk and honey and strychnine, but between various types of brackish water. Once you accept that, you can begin to see that if pain is inevitable, then the winner is the person whose pain makes most sense. At least my brackish water is wheatgrass, yours is just pointlessly unpleasant.

This suggests politicians should not hide from the pain you cause, but use it as proof of your commitment to the straight and narrow, which in turn allows you to talk credibly about the future and what can be built.

National sacrifice and renewal become important words. Be straight with people that pain is inevitable, and the question becomes not pain or not, but what pain, for what purpose. 

Second, there then needs to be credibility that the remedies you suggest are effective, and will make a difference.

If you're going to be ripping winter fuel allowance out of the hands of pensioners, you need to be able to argue convincingly that the scheme you favour isn't a state boondoggle of wasted cash.

That means a focus on spending discipline throughout government (Rachel Reeves' speech today is interesting on that subject), but it also means that every programme of investment needs some sort of external benchmark.

If you're going to reduce the standard of living of pensioners and those saving for pensions, you should go the extra mile to prove that you will make good use of the money.  This would also suggest, by the way, that you should use you capital budget more as a lever than a direct grant..

If your capital schemes can't demonstrate, to an independent adjudicator, their their multiplier is above a certain level, then the state should pledge to keep the money for a tax rebate fund for low income families and pensioners, so they can spend it. It's all about priorities remember, so a half cocked scheme shouldn't get cash.

I don't pretend this is going to be popular. I just contend that given a choice between fiscal fantasy, fiscal pain, and fiscal pain with ambition, calibrated pain with ambition at least has a fighting chance.

Nye Bevan, to Jennie Lee, on the possible disaffiliation of the ILP from the Labour party. 1931

I wanted to write a response to Alex Hilton's Cri de Coeur, published by Labourlist this week, not because I was outraged by his public loss of faith, but because I felt some sympathy with it. You can't have faith in something without the possibility of losing that faith, and since Alex and I are from a generally similar generation of Labour activists and hacks, I feel rather like a country vicar reading the furious apostasy of an old friend from seminary, disgusted by the hypocrisies of our shared church and the inadequacies of the Mitre-wearers who sit in palaces while sin reigns unchecked. There's some uncomfortable truths, but I can't hep but think of my own congregation.

Alex and I come from radically different places in the Labour party. Indeed, given what Alex writes about his political positions, (disgust with a loss of party democracy, the need to stand up for those who need us most, the need for more social housing)  I could argue he should be happier with the current direction of Labour party politics and leadership, than I, a fiscal conservative, a fully signed up Blairite zombie, and a fairly unethical, (though more importantly, unsuccessful), capitalist. 

After all, when people say of some bland centrist, "Why doesn't he bugger off and join the Tories, eh?" They're usually talking about me, or someone I agree with. I can tell Alex, that once you've heard that particular barb a few times, a small childish part of you is tempted to grant the accuser their profoundest wish, and bugger off. (I wouldn't join the Tories, no matter the internal provocation. There is some shit I will not eat, as the poet said).

So I have some sense of what it is to be on the uncomfortable edges of the flock, wondering if it's really going in the right direction. 

I'm not alone in this, of course. I suppose one of the few things I share with the hard left is that we must all have wondered at some point whether the game was worth the candle, whether it might not be better to let these mad trots/dangerous neo-liberals (delete as appropriate) get on with it without our special genius. I have this mental image of Tony Blair listening to Derek Hatton in the early eighties and wondering what on earth the two of them were possibly doing in the same party, and Derek Hatton wondering the exact same thing. That one was eventually resolved, thankfully.

So my sympathy for Alex is driven by the fact that I too have had the crisis of faith Alex describes, if a slightly different variety thereof. Yet I have bitten my tongue, in public. (I make no claims for what I've said to friends, or over beer, or during one day conferences in central London, or even to advisers to the people I struggle to agree with). I've shut up, or passed over certain disagreements to focus on more constructive ones, because, for all my crises of faith, I still believe in the capacity of the Labour party to change Britain for the better, and want a Labour government, and want to be able to go up to the leader of the Labour party and say "Hello, Prime Minister". I've done that twice in my life, and it's pretty damn cool.

Just because I think like this is no reason for Alex to feel the same. I could argue that Alex is wrong about the state of the Labour party. I could try and persuade him that Ed Miliband is the greatest Leader in political history, that refounding Labour is a profound change to our party democracy, that our current vision for the country is clearer than the most perfect diamond. I don't believe these things, as it goes, but I could still make the attempt in the interests of returning the sheep to the fold*. There's something to be said for everything that Alex condemns, after all, and a defence that can be mounted for the performance of each. 

 - I mean, Alex, can you really not fathom at all why anyone might vote for Ed Miliband? I didn't, you know, but he's intelligent, personable, had been a decent minister and said he wanted to change the Labour party for the better and that we'd got a lot right but some big things wrong. I reckon quite a lot of people in the Labour party would say that's a pretty good combination of skills, views and experience. In fact, the only situation in which it would be irrational for anyone to vote for Ed Miliband is the alternative candidate was me, and sadly, I was not available.-

But while each of the propositions Alex puts forward can be fought over, they don't get to the heart of the matter. You don't restore faith by arguing over definitions.

Instead, I want to accept that everything Alex says is right. I want to tell him that yes, Ed Miliband is the worst leader of the Labour party in history, our reforms of internal democracy are a joke, that we are run by a small group of unprincipled careerists with no interest in the people beyond their own narrow circle who have no chance of appealing to the great mass of our nation. I don't believe any of these things either, but Alex does, and that's what matters.

Even if all these things are true, the Labour party is still worth it.

It is still worth it, because while the Labour party may be a flawed, imperfect vessel for our ambitions, it is the best vessel that exists for the building of a more just society. If Ed Miliband was not just as bad a leader as Alex suggests, but even worse, this would still be true.  The Labour party is not just Ed Miliband, Ed Balls, and their comrades in the shadow cabinet and in parliament, because that apex is merely the tip of our political spear. The Labour party is also the canvassers, councillors, activists and members that allow them to sit in parliament. It is even the reviled spin doctors, the union fixers and worst of all, the thirty-something bloggers, like me, wondering exactly how it came to pass that they are never going to lead the Labour party to a record four election victories, but instead be forced to watch other numpties making such a mess of their chance to shine**.

I want to change Alex's mind not on his critique of the party, which is his right to voice, as much as it is mine to disagree, but on the choice he believe he has a result.

In his last paragraph Alex says "I’d like it if you were honest and told us who the Labour Party’s going to help, and how, and set your policy direction consistently with that declaration. And then if we didn’t agree with you, we could just leave rather than persisting with vain optimism."

But that's not the only choice. There's a better one. There's the choice to fight, not for what you want Ed Miliband to be, but for what you want Labour to be.

I've made my choice, to do what I can, to help the leadership where I can agree, to critique as constructively as I can manage if I honestly cannot.

I may be wrong about this, I may be being cowardly. Perhaps I should trumpet my dissent and mute my approbation, but that is the choice I made, to fight a quieter battle.

If Alex believes what he says, he has a different choice. He could call for the removal of Ed, and his replacement, if not by Stella and John and Hilary, but by someone, anyone who would be better.

That would be a lonely stance, and would attract even more opprobrium than Alex is attracting now. But it would also be brave, and noble, in its way, and a fight worth making, even if doomed to failure.

Stick. Fight. Win. and remember, always, even if you lose, you never lose forever. La Lutte Continue, and all that.

So, Alex, don't worry about the faith you have in Ed, or anyone else. Concern yourself only with the fight for the party you want us to be. Perhaps you'll lose, just as I, and my fellow zombies, feel we are losing now.

But only the alternative, of departing from the field, guarantees your defeat, and that, as Nye said, is an impotent purity.

*In Order: Ed Miliband has done well in getting us back to evens, though I fear that won't be anywhere enough, and I worry that no-one seems to be worried it's not enough;  Refounding Labour is OK, so far as it goes, but won't change much; and our vision for the country is at the magic eightball level of meaningfulness.

**there's another element to this, which I suggest hesitantly as it is probably just me, not Alex. I'm getting older. It was a lot easier to accept the compromises and hypocrisies of politics when the careerist with high hopes of elevation was, um, me. To accept that the fight is still worth it even if you don't even get to be an attendant Lord, fit to swell a scene or two, requires a greater degree of intestinal fortitude. More positively, it makes it clear what you really care about. I want a Labour party that approaches the world in a certain way, and I've stopped caring whether anyone notices my role in making it that happen. In some ways, this is quite liberating. You get to be much more annoying, for one thing.

Back then, he was associated in my mind with Air India first class washing kits, the appearance of whisky and soda, and talk of New York, Delhi, Geneva and other places I'd never been. I didn't know what he did, really, but I understood it was important, and extremely serious.

Yet while serious, there was always something light about him. I have a memory of him singing, when reprimanded for some domestic infelicity "Bad Boy, Bad boy, what you gonna do?".  I can't quite believe this is right, this semi-retired Indian diplomat singing off-tune Bob Marley, but there it is, lodged in my brain.

It rests there with other near-surreal childhood memories. I recall visiting Delhi as an eleven year old with my grandparents, and my daily life changing from getting the bus to Margaret Glen-Bott comprehensive, to having guards saluting as we entered his club, the Delhi Gymkhana, where I played badminton under the watchful eyes of a coach and a armed soldiers standing on the towers which protected the Prime Minister's residence next door.

Or there's the memory of being driven with them to the International Centre, where he and my Grandmother would drink small whisky and gin and tonic with the likes of Mark Tully while I ate samosas with ketchup, or paneer tikka, or gulab jamun.

It didn't seem unusual at the time. I was a basically happy child, and I suspect such children tend to accept their unusual into their lives with equanimity, but it certainly made the return to Nottingham a little anti-climactic.  Maybe that's what it's like for ex-Prime Ministers or deposed royalty. Once a man in a smart uniform and magnificent moustache salutes you as you get back from badminton lessons, perhaps nothing else ever feels quite satisfactory.

As I grew older, I understood a bit more about my grandfathers career and why it involved such interesting diversions for his family. An entrant into the Indian Civil Service in the late Raj, he became a diplomat in the approach to independence, before holding a succession of ambassadorial posts, including Ambassador to the UN, High commissioner to Pakistan, and High commissioner to the new state of Bangladesh, where he was victim of a, thankfully unsuccessful, assassination attempt. A longer appreciation of his career can be found in his obituary, which is beautifully written and true to what I knew of him.

All of which recollection is in preamble to a film and an accompanying note my dad sent me the other day.

The film is a propaganda film that my grandfather made, around 1943, when he was a civil servant in Bengal. It is intended to describe the life of a young district officer in Bengal and depicts an apparently self-governing world, with the British as either absent or supportive figures to the young Indian administrator. It is only thirteen minutes long, so worth watching the whole thing.

The note, written sixty years later, is my Grandfather's mordant commentary on the making of the film.You can find the whole text at the bottom of this post.

As the the accompanying notes to the film, by Colin McCabe, point out the film, like all propaganda, is something of a lie.

"…The film was made two years after the disastrous Bengal Famine, caused not by shortage of food but by maladministration. (The BFI places the film in 1945, perhaps because of its later destiny) The film never mentions the famine but it portrays a picture of an efficient and humane administration that would never let another such disaster happen."

Actually, it was rather worse than that, according to my grandfather's opening remarks. When the film was made in 1943, he was not a young district officer, presiding gently over the lives of three million Bengali's, but instead working to ameliorate the Bengal famine. .

"I was posted as Regional Controller of Procurement of Rice.  My job was to buy up on government account as much rice as was possible and to make it available for the relief of millions of poor people who were suffering from starvation; there was a severe famine in this land."

As he says later, discussing the exhausting series of good governance skills he is shown employing for the benefit of the Indian people:

"However, the procurement of rice which was my specific job did not feature in the film"

It's not hard to understand why. My grandfather says the film was intended, mid-war to impress upon Americans the great strides India was making towards eventual independence.

"..it was proposed to make a film depicting the great progress the Indian officials were making under British guidance in running the affairs of the country, and how they were now fully co-operating in all aspects of administration.  This trend was to be encouraged by the USA so that eventually India could gain a suitable form of high autonomy and perhaps even full independence"

All this in the context that Britain desperately needed American support in the war, but that Americans were thought, understandably, to be unwilling to fight a world war in defence of British imperialism.

On being told that the film needed to feature a young Indian official, doing worthwhile work, but also "looking forward to the day when Indians would be the masters of their own country" my grandfather agreed to be featured, despite doubts about the films likely efficacy for its intended purpose, as "I did not think he (the Director, a Naval commander) was too familiar with the Indian administration or too well equipped to meet the requirements of what I thought to be the American film market".

These doubts were well founded. It is hard not to watch the finished film today and smirk knowingly.

For a British propagandist to feature a Bengal apparently unaffected by famine was ludicrous, an ludicrousness underlined by the initial cod-heroic tones of the voice-over, viz: "Nature and man fought a battle, and man won" and its rapid switch into an overtly paternalist tone as we are first introduced to my Grandfather dispensing justice, and then shown how he has been prepared, by unseen hands, for the role he plays as impartial administrator to millions of Bengali's.

In contrast, I seem to remember my Grandfather saying that before entering the ICS, he sought permission from the big players in Calcuttan politics. They assented to his request to become a civil servant, as an independent India would also need civil servants and diplomats.

It is strange, of course, for me to see images of my grandfather as a young man I never knew. There are touches of the man I would know. A shrug, an apparent seriousness of purpose that belies a mockery of the lunacies he is obliged to go along with and a slight, private, understated theatricality.

I can understand why my grandfather agreed to make a propaganda film, even in the midst of a terrible famine, that it is arguable, the British administration of Bengal was complicit in worsening, and certainly failed to abate effectively.

A post-war Bengal ruled by Japan would have been in a far worse situation than an India governed, likely for only a little while, by a gravely weakened Raj.  Indeed, by 1943, it must have been clear that independence, in one form or another, was inevitable. What's more, would the advancing Japanese armies really have had the welfare of Indian peasants as their priority, should they have been victorious. It seems unlikely, given their record elsewhere.

In those terms then, supporting the British in their war effort was important and worthwhile, even if it was also, at the same time, a by-way on the path to an independent India and a choice riddled with compromise and contradiction. I'm reminded of Arthur Koestler's novel, the Gladiators, where his unwilling revolutionary leader is forced to attempt the long, diverted, round-about path to a better world, for the straight clear path leads inexorably to disaster and death. But to take the winding path, itself involves a moral choice, an acceptance of imperfection, of failure, of compromise.

Maybe I'm reading too much into this. Perhaps my grandfather just wanted a few days distraction from the regional co-ordination of rice purchase. These motivations are real too, and he certainly seems to have enjoyed the process of making the film immensely.

But I suspect it was a considered choice, and that he regarded the path India was on as likely the best of the available options, and given the path of Indian history, eventual independence, his own career, and India's gradual emergence as a democratic, open, broadly tolerant global power (though one with glaring flaws, inequalities, injustices and stupidities), I like to think that he has been proven right in that judgment.

Sometimes, perhaps, Dr Pangloss is right. Everything does turn out to be for the best in the best of all possible worlds. It just depends on your precise stress on the word "possible". I imagine the young regional co-ordinator of the purchase of rice would look at Indian modernity, shrug and say that, "well, things could certainly have been a lot worse than that." 

This debatably panglossian destiny of India, was, however, not one the film itself would enjoy. Granddad relates that on its premier in New York, it was greeted with "so much shouting, hooting, and malicious handclapping and cheering that the British authorities had decided to withdraw it forever." As he notes, it was, a deserved fate for a "frankly clumsy propaganda effort".

Perhaps this is a fitting conclusion in itself. For while the British propagandists were frankly clumsy, I doubt Samar Sen, a diplomat, a quiet wit, and my grandfather, was anything of the kind.

Nor is this oddly sexualised assault on Mr Miliband new territory for Norman, M. When he isn't trying to popularise the therm "Milibandroid", (which he coined a few years back and recycles on every occassion either Miliband brother hoves into view, perhaps  on the assumption that familiarity breeds laughter), Norman has previously asserted that "what David Miliband needs, right now, is a damn good thrashing on his bare bum with a finely honed cane",  declared that "Where boysie girls can prosper in combat politics, girly boys cannot". and that he is "coquettish" and his attempts to lead the Labour party were "knicker-flashing" which established, beyond any doubt that "David is a wuss".

Got that, people? David Miliband is not, to food writer Matthew Norman, a Real Man.  (Oddly, this last assault of the cojonal-status of Miliband D, was by way of a paen to the greater gonad-posession of his younger borther. Now, I happen to rather like both Miliband brothers, but to be truthful with you, if I had to choose, in the privacy of a pollling booth, which one I associated with swaggering machismo, my pencil would hover over the ballot for an age, before dropping it unmarked into the waiting slot (see, try hard enough, and you can sexualise even the act of not voting). 

I know, I know. Mr Norman is intended to be a cheeky political gadfly and pricker of pomposities. I mean, what can you say about a journalist who cannot decide whether David miliband is a disgrace for not serving in the Shadow cabinet, or a disgrace for not departing politics entirely. I know his hyperbole is intended to amuse, provoke and arouse the somnolent readers of the Broadsheets of Britain into some sort of reaction. What's more, as a food writer, I like him. After all, he reviewed Gaby's Deli, when every other London food writer was shamelessly sucking up to that overpriced Jew/LES (deliberate pun) pose fest Mishkin's.

So yes, yes, when it comes to politics. Norman is supposed to be Johann Hari on speed, George Monbiot on crack. a sort of Lefty Letts whose verbal dexterity allow him free reign for the scattering of abuse upon his chosen targets.

But you know what? Letts is just being a dick, and so is Matthew Norman.

What's more, he's being a dick, on command, for money.

There's a term for that, and it's even less complimentary than castrato.

Yet although the headline of this post is both an ugly phrase and a cliche in waiting, it contains a certain truth. Ultimately, Electoral politics is not about the quality of your critique, the purity of the values you hold or the agenda you have set, but instead, a question of the appeal of the solutions you offer.

That doesn't mean your solution has to be right. It just has to make sense and seem plausible, especially compared to what the other lot are wibbling on about. In any case, what the "right" solution is not for you to decide, but for the voter. All your solution has to do is make sense to them, given what they know about you, your party and your likely ability to deliver.

This then is why I find myself uncomfortably squirming whenever politicians claim to be setting the agenda. It may be true. they may be doing something valuable and important in so doing, but ultimately, I don't want a politician, or at least not a front line politician, to be setting agendas. I want them to be offering solutions to the problems already on the agenda, and, if possible anticipating the problems coming up.

Part of the reason for this is simple. If you restrict yourself to defining the problem, you leave it entirely within the capacity of your opponents to provide a comprehensible alternative answer. If you own the solutions, you can never be caught bathing, or find that you opponent has suddenly slipped into a more flattering set of speedo's.

It' why the Labour party were right to assume that the Big society was an electoral joke, with little political appeal. It represented a non-solution to a real problem, simply suggesting that the withdrawal of the state could be matched by an extension of civil society, performed by a collection of magic unicorns paid for by fairy dust.

Yet we too must learn the lessons of the Big Society. People nodded along to David Cameron when he talked about Broken Britain, about social disconnection, about the loss of a sense of community. He got some points for that, for being well intentioned, and possibly not a fiend in human form, like those other Tory leaders. But when it came to what he would actually do? Indifference at best. Contempt at worst..

These thoughts were what I had in mind when I wrote this month's "State of the left" for Policy Network.  Over the next year, I argue, Labour needs to shift from agenda setting to offering solutions.

Reading the positions of the left in the other articles, especially the German, Italian and French contributions, is that moving from opposing of your opponents stupidities to presenting solutions to our current crises of confidence, economy and state is both politically tricky and requires choices that will divide the left, not just among left-right lines, but by age, class, occupation, nationality and priorities.

I'm increasingly of the view that that this process of debate, division, decision will be both painful and necessary for the British left. I'm usually a voice for loyalty, but I fear a loyalty based on avoidance of choice. I may well lose -indeed, I expect to lose-  most of the arguments simmering under the surface of the British left, but best to have them soon, and then be loyal. 

We've left the nice decade behind. Politics is a solutions business, and right now, there are no easy solutions.

If he is anything, George Osborne is as political a Chancellor as his predecessor but one. Like Gordon Brown, he's an electoral, as much as a policy driven politician. Like Gordon Brown, he see's the power of policy in government to shape the political contours in a way that is comfortable for his side, and painful for the opposition.

So if I were a Labour strategist, I'd be looking very carefully at the YouGov opinion poll Polly Toynbee quotes in today's Guardian and thinking about where George Osborne is going to want to go with the Budget.

Polly rightly notes that there is significant public support for higher taxes on the wealthy, with 66% supporting a mansion tax on properties worth over £2million, 50% supporting the same tax on properties over £1 million (significantly biased regionally) and even 50% of Conservative supporters agreeing with the principle that the richest should pay more in tax.

Yet the same poll suggests that 54% of Labour voters want to see tax cuts over increased spending or keeping spending the same

(Note: Don Paskini in comments points out the Q doesn't mention spending. He's quite right. I'm assuming a connection between Tax and spend here that isn't mentioned to those answering that Q and which they may not recognise. As he says, the Q asks about Tax cuts to drive growth, tax increases to reduce deficit, or keeping taxes the same. However, given the support for spending cuts outlined below, the point holds, I suggest).

In fact, Labour supporters want tax cuts even more than either Tories or Lib Dem voters do. This may reflect Labour support for reduction of VAT, but it may also reflect a sense that the easiest way to improve living standards is through tax cuts in any form. You'd need to do qualitative to find out, but it is really noticeable.  

Further, a plurality of voters want to see the current pace of spending cuts maintained or increased, even though they expect the economy will go back into recession. This divides sharply by party support, with Labour supporters wanting to see the pace of spending cuts reduced.

But what's really interesting is that all of this is in the context of real pessimism over the state of the economy. People think things are bad, (3% think the economy is in a good state) and are going to get worse (53% think they will be worse off over next year, only 8% think they will be better off). 

This leads me to wonder what happens if things don't get all that much worse for most people. If even if another couple of hundred thousand are added to the unemployment register, there is a fall in inflation, and some improvement in private sector wages or some reduction in the cost of living by a reduction of the tax take?

If I were George Osborne, I'd be trying to both take advantage of the polling mood outlined above, by eyeing some flavour of increased taxes on the wealthy for symbolism, heavy pressure on welfare and services budget to stay on track with the deficit, all combined with a significant low end tax cut for "stimulus" and "relief".  

This might prove an extremely politically powerful message for the coalition. Done correctly, it could even be presented as overall fiscally neutral. If Osborne chooses something like this, the YouGov poll suggest it will, at least at first, have significant electoral appeal. 

This is a response to the publication of "White Flag Labour" by Compass, (AKA The North London society for serious frowns and regular conferences) which itself is a critique of the publication of "In the Black Labour" by Policy Network (AKA The International Brigade of the Third Way).

Ah, opposition. Where no-marks like me can build reputations through devoting themselves to creating an endless flow of tendentious babble.

Enjoy.
 

*I have recently been criticised for a surfeit of self-deprecation. I am endeavouring to reform.

A hunger for a more moral, ethical capitalism is an important part of any left of centre political mission, but we make a mistake if we think the idea appeals only to us, or that only we can be trusted to deliver it.

We have barriers to overcome too, and we should think carefully about what we seek to achieve by reforming capitalism.

I was a little surprised to be invited to speak to the Fabians about the return of Ethical Capitalism to British political debate,  because I am neither a successful capitalist (my business career was ugly, brutal and relatively short), nor particularly ethical. 

On the moral front, I am, I suppose, roughly as susceptible as the next person to the possibility of making a few million pounds through inaction, neglect or selfishness. I suppose I should feel lucky such an opportunity has not yet presented itself and that  I have not, therefore, been forced to discover how moral I really I am.

Given this damning lack of both capital and morality, perhaps the most useful role I can play is to sound a slightly sceptical note about the left’s rhetoric, language and approach to these issues and call for a careful, meticulous, building of the path forward. 

I begin with the assertion that a demand for a more ethical, moral capitalism is neither new, nor historically, a uniquely left of centre concern. More than a hundred years ago, Teddy Roosevelt was denouncing “Malefactors of Great Wealth” and in his 1902 State of the Union speech, he told Congress that:

“Great corporations exist only because they are created and safeguarded by our institutions; and it is therefore our right and our duty to see that they work in harmony with these institutions.”  

Forty years ago, Ted Health was denouncing Lonrho as “The unpleasant and unacceptable face of Capitalism” for its efforts to minimise tax liabilities. You can draw a direct line from this moral rhetoric to the debates Ed Miliband feels he has led on the regulation of Banks, the need to secure taxes, the importance of tying rootless corporations to the societies they prosper in.

Perhaps, a generation ago, Tiny Rowland would have fallen into the “Predator” category.

This history shows Moral Capitalism is of historic appeal to Ted’s and Ed’s through the ages, but doesn’t lead to the conclusion it is the preserve of the left alone.

It is equally plausible that the right or centre's belief in the power of the invisible hand does not blind them to the possibility that those participating in the market need to be controlled, regulated and watched over.

Even the most hardened monetarist or gimlet eyed Austrian will agree with Adam Smith that:

“People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices”.

We can see a bi-partisan market-scepticism in our cultural history too.  The one man and an acre anti-capitalism of the distributists is not too far removed from Orwell’s "Moon under Water" or from the misty eyed defence of the village shop and the local pub that appears every weekend in the style magazines, usually under the by-line of a deracinated metropolitan intellectual of either left or right.  Nor is the outrage of Trollope at Melmotte much distant from the way modern Tory moralists like Peter Oborne or Simon Heffer despise today’s fast buck merchants.

If I am right that the urge for a more moral capitalism is more “Pan-political” than partisan, what does this mean for our current situation?

First, realise that while David Cameron may not be serious about delivering a more moral capitalism, he will certainly be able to sound serious about it. He will have a political and cultural heritage to draw on, even as he struggles to overcome his own career history, ideology and policy commitments.

Equally, if the Tories’ perpetual challenge is convincing people they mean what they say, the left must convince people that we, worthy Fabians, former advisers and woolly academics that we mostly are, can deliver what we wish for.  

If the Tories have a tendency to sound like they won’t reform the abuses of the markets, then we sometimes sound like we’d like to do more, but don’t really know how. So we want to reform banking, but essentially we endorse the Vickers Report, and just want it implemented quicker.  We want a fairer market, but say we’ll deliver it by some a minor change to shareholder rights.

This implies we should mind the gap between rhetoric and effect.

We sometimes talk about ending neo-liberal consensus, but propose tighter regulation of train fares and a union rep on pay committees. These are worthy suggestions, but we should not bring them to market under grandiose language. They will not end neo-liberalism (whatever that is). As a former Procter and Gamble adman, I can tell you a washing powder that promises to remove ground in stains but only removes fresh gravy splashes is in big trouble.

We should also grasp that many people have good reasons to be sceptical about progressive schemes to reform capitalism. After all, a lot of apparently brilliant ideas don’t work that well, or turn out to have unintended consequences. For every Glass-Steagall, there is a Smoot-Hawley. For every 3i, there is a MG Rover, for every Minimum wage, a Selective Employment Tax.  

This mixed record of reform places a big emphasis on proving that you know what you’re talking about. It puts a premium on thudding practicality (and perhaps on Midlands businesswomen above tweed jacketed principals of Oxford Colleges).

Second, we should think carefully about our choice to use the language of morality over, or entwined with, the plainer language of structural reform. There is a slight tendency to conflate a more ethical capitalism with a more even balance between different segments of the economy.  

There is nothing more fundamentally moral about a manufacturer compared to a financier. To realise this, you only have to read Arthur Miller’s “All my Sons”, or Greenwood’s “Love on the Dole”, where it’s not entirely clear who is the more immoral, the corrupting but present local bookmaker or the heartless, absent Marlowe’s manufacturers. (Another example might be “It’s a wonderful life”, today best viewed as the cautionary tale of an undercapitalised, poorly managed sub-prime mortgage lender which comes to grief and requires a public bailout.)

It is my prejudice that a manufacturer or research group that pays badly, avoid taxes and seek to evade regulation is only more moral than a financial services company in that it is probably harder for them to evade responsibility for their actions. Regulation for a more ethical business should be sector blind.  There are moral Steel manufacturers and immoral ones, moral accountants and immoral ones.

Ultimately, strong regulation is the friend of the “moral business” in any sector.  A more “moral” economy is not conditional on a differently structured one. Each is a good in itself.

Now, there are real, solid reasons to want a differently structured UK economy. There’s a wider tax base, stronger regional development, the need to secure a better trade in goods, a desire to find long term competitive edges through innovation, and of course employment (though this latter can be exaggerated). All of these really matter, but they are not simply moral issues.

Finally, we should always remember what the purpose of a more moral economy is.

On the left, we seek an economy where the rewards for business success are shared broadly between shareholder, manager and worker, in the form of share-price, salary, wages and employment, and where this success is also used to fund social goods essential to the success of both individual companies (infrastructure, research, skills, and so on) and a society that supports such companies (Health services, education, safety nets, police forces).

All of this is reliant, not on the immorality of capitalism, but on its morality.  This suggests that while we should carefully regulate and watch over potential malefactors of great and little wealth, and that we should certainly not be subservient to them, we should also recognise that they are essential to us, and we need them, and we want them to succeed. It’s a lot easier to be ethical when you’re profitable.

None of this is to say that reforming capitalism is a pointless endeavour, or that the state should not play a major role in doing it. Rather, it is a central part of the mission of the left.  I’d just suggest that to make it work, the left should approach the challenge somewhat differently.

First, speak less of morality and more of practicality. Focus on the specifics, the credible, the nuts and bolts, rather than the grand sweep. The strongest charge against us is that we don’t know what we’re doing and are simply fiddling with a machine we barely comprehend.

Let’s not lay ourselves open to the charge we don’t understand business, or have missed a crucial detail, or that our plans will lead to some dreadful unintended consequence. Win over business leaders, and engineers, and innovators who know whereof they speak before attempting to win over the public.

Second, remember why we seek to reform capitalism.  Not because we want nicer capitalists, but because we want more jobs, higher wages, and less exposure to complete collapse.   Everything we do should revolve around that mission. Every policy, every reform should be measured against those aims.  If we achieve them, this will demonstrate that we are achieving a more equitable capitalism.

Finally, remember that a successfully reformed capitalism requires a successful capitalism. We know this, of course, but sometimes allow ourselves to sound as if we take it for granted, or that we’d rather not dirty ourselves with the business of success and profit.

Just occasionally, we might sound like we really believe that Capitalism, watched over by the public interest, is a wonderful, successful thing.

We just know that it can be better yet.

This morning I woke up in a Britain where little or none of that is happening. The Chancellor talked about the march of the makers last year, but look at the way the Local Enterprise Partnerships and Regional Growth Funds have been so tied up in their structures they've barely made a loan. Green Investment Bank? Schools building? There has been progress on some things, like Technology Innovation Centres, but too often government support for business has been small, slow and simply overwhelmed by the impact of decisions elsewhere -from VAT to Eurozone to low lending rates. To take just one example, The Chancellor first talked of Credit easing at Tory conference. but I don't think the National Loan guarantee scheme has made any difference yet. We're just always a little late, a little slow, a little small.

So naturally, we get bad news. A cuts programme before growth was established, and a hefty tax increase for working families at a time of inflation and wage freezes leaves low domestic demand, while overseas markets don't offer the export boom we'd hoped for. The government strategy wasn't going to work, and is going to mean growth that is late and low.

Now, growth will return, in the end, because businesses will adapt, and demand will recover and new opportunities will be created. It's just that in the meantime we'll have wasted life chances, seen people stuck on the dole, productive capacity lost.

That's the bad news.

But the bad news is that the problems the next Labour government will face just got harder, not easier.

Perhaps some partisans might be tempted a smile and an "I told you so" at the difficulties the Chancellor's arrogance has got him into, but there's no upside here. Labour should be desperate for Osborne to succeed, even as he fails. Lower growth means higher unemployment,  more costs of failure, more stubborn deficits, less room for future investment. It means the choices the next Government will face on the deficit and the economy get harder, not easier.

Every quarter without falling unemployment, every quarter of sluggish or negative growth, every failure to increase tax revenues by anything other than squeezing family living standards makes Labour's task harder, our future choices a little less easy.  How do we create the Investment Bank, if we face cost pressures from unemployment benefits? How do we fund upstream research, or major infrastructure, if high deficits are projected for the next decade? How do we help employers raise salaries and create jobs in an environment where domestic demand is weak, and exports don't seem able to make up the gap. How do we do all, or any of this, within a tight fiscal settlement defined by low growth?

I hope to God Osborne finds a way to wriggle out of this. I hope he finds a way to adopt a different path now. Because if he doesn't, the starting point for the next government will be worse, and the options available to it even less pleasant, than we feared a year ago.

Mehdi's argument in both the original New Statesman article and his subsequent blog post shows the difficultly of separating out a debate about political rhetoric from the policy position which underlies the rhetoric itself.

Labour are, Mehdi argues, trapped by an Conservative frame, in which "cuts and credibility" become the test of political virility, and since this is a battle Labour cannot hope to win, this is a foolish attempt to fight the enemy on their own turf. This creates, he argues a position in which "There is a theme here – the Tories set the agenda, Labour operates within it."

It is perhaps worth comparing this with what is allegedly a strategic phrase of George Osborne:  "in opposition you move to the centre, in government you move the centre." I think a fair few Conservatives would look at the journey their party has undertaken over the last five years and question whether they were really setting the agenda until they entered government. Indeed, the whole history of the last century suggests that the conservatives are not notably successful at setting the agenda, but very successful to adapting to newly set agendas (witness Cameron's position on gay marriage.)

Mehdi's argument is that Labour has conceded to a Conservative narrative framework on the deficit, and that since this is a battle Labour cannot win – we cannot "out-austere" the Tories, we are destined to lose this debate, Mehdi prays in aid the work of George Lakoff, saying that it is a great shame that the Labour front bench haven't read Lakoff's "Don't think of an Elephant"**. Now, I have read that book, and also Lakoff's "Moral Politics". Indeed, I was a minor evangelist for his work inside the Labour party, finding it a useful tool to emphasise particular words and themes in copy we were producing. 

Tip: If you don't want to buy Lakoff's book, his ex-colleagues at the Rockridge Institute keep PDFs of their practical guide to reframing "Thinking points" here

Lakoff's work is ultimately about the power of language. He believes that particular metaphors, or ways of framing arguments, allow you to make a more persuasive case for that argument.  

For example, A conservative should argue for "Public Sector Restraint", not "Cuts". Why? Because Conservatives already have the "Cuts" group bagged up, and need to reassure those who have a bit more of a "nurturing parent" in their make up and fear the pain a cut might bring (I simplify).  A progressive on the other hand, should not accept the language of "a Death Tax" because it accepts a Conservative frame. Instead, call attempts to reduce estate taxes a "Paris Hilton Tax break".

To me, this is a powerful -technical- insight.  it helps a politician to understand whether they are doing their job, well, or badly. Want to appeal to environmentally minded left wingers about GM crops? Then don't talk science. Talk about the historic mission of ending hunger on our shared planet.  Want to sound reasonable and non-threatening while demanding a restriction on Child Benefits?  Talk about encouraging a culture of responsibility, not of dependence.

In many ways, it's worth thinking of some of Lakoff's work as a liberal response to Republican strategist Frank Luntz's "Words that Work". Indeed, when looking at the practical application, they often feel like very similar Vade Mecums for political comms professionals***. Further, Lakoff himself will admit that much of his political work was driven by a sense that the Conservatives in America somehow knew how to "Frame", while Liberals and progressives did not.

It is here that I raise my first concern with the use of Lakoff's linguistic approach as a critique of a particular policy agenda. If Lakoff is right that we can use words to appeal to those who disagree with us by constructing a frame in which it is difficult to dissent from, and which then defines the debate in the public sphere, then two things follow:

First, this approach is, in itself, essentially neutral. You should be able to construct a "frame" for any given proposition which maximises its likely appeal.

It doesn't matter whether you are arguing for or against a progressive tax rate, if you can apply the correct linguistic frame to it, you will maximise likely success. Same goes for the deficit. In Moral Politics, Lakoff gives the example of Reagan's approach to the Federal Deficit as an example of how a Conservative can justify high deficits using a moral framing. It should follow, therefore, that a liberal-leftist should be able to successfully promote long term fiscal restraint using similar framing techniques. There should be no policy position that cannot be successfully "framed" by a skillful practitioner.**** In essence therefore, any policy critique based on framing must be incorrect. Any position should be susceptible to skillful framing.

However, my deeper critique is that if both sides take the advice of simply developing the "best frame" for their existing position, there is essentially no interest in the voter at all, merely a competition of framing devices. You end up with a left winger trying to bludgeon a right winger with their superior frame, and the right winger returning fire in kind. The person left out of the debate is the most important – the shifting, variable concerns of the voter.

I believe politicians prosper not when they seek a retrospective linguistic justification for their preferred policy agenda, and seek to impose it on the electorate via strong framing, but when they put the worries and concerns of the sympathetic but unsure elector first, and try to construct their rhetoric around addressing these concerns, first in policy, then in framing terms. (If you cannot find enough potentially sympathetic voters to win you an election, then you probably have a bigger problem than framing to think about).

So for example, Labour might discover that the barrier that prevents a significant number of "open" voters from supporting Labour is a concern about whether Labour will tackle issues of crime. Labour can then develop a policy agenda that demonstrates a firm approach on crimes of particular voter concern, and use these as the framing device to persuade the voter their concerns are unfounded, without undermining our essential policy agenda or image. So an ad for a party perceived as being "Weak" on Crime, might emphasise a focus on strong action on violence against women, and of toughening up the legal threshold for prosecution of sex crimes, or demonstrating that the leader understands why these issues matter.  In advertising terms, this is called "overcoming the benefit barrier" – removing the obstacle that stands in the way of a potential consumer desiring the overall benefit your product offers.*****

Now, how does this apply to the debate about the deficit?

At one level, it doesn't at all. After all, the first question about the deficit is not "What frame shall we seek to apply to our plan?" That's a second order question. The first question is "What are we actually going to do. and why?".

While an argument about language is helpful in deciding how to frame a debate, it doesn't in any way help you to resolve the policy tensions that are fundamental to successful governance. Labour is proposing a policy of short term stimulus, long term restraint, not because it fits in within a frame, or because it overcomes a voter benefit barrier, but because we think it is the right thing to do.

Now, if we are wrong about that, this is a whole other debate. But let us accept that it _is_ the right thing to do and that we are not prepared to jettison this for electability, because our overall purpose – a fairer society- is important to us.

We next need to understand what the barrier of key parts of the electorate are to our offering. These are, I think, likely to be along the lines of – "why should we trust you after what just happened, you're profligate with our money, you can't be sure that spending more money will work, you say you'll pay off the debt, but never when". 

So, the purpose of the political rhetoric we use should be to overcome those barriers. If they are the ones I have identified, that suggests focus on cheeseparing, on being anti-waste, on the value of state restraint, of being careful with pennies, of setting boundaries for government spending for only productive purposes, for being – to borrow a phase- both "tough on the deficit, tough on the causes of the deficit".

You can frame your policies in this light of this need. So If your policy agenda is one of spending to save, then you come up with specific examples where spending will clearly and measurably reduce expenditure, and emphasise these, rather than assert the vale of spending more generally, If the policy is "spend now, save later", you might need to prove your commitment to the second part of that equation.

This is not "submitting to the frame" of your opponent, but focusing on people who might be interested in the benefits a centre left government offer (for example, more jobs, or a more equal society, or a better run NHS or school system), but who have doubts which leave them unconvinced.

An emphasis on overcoming voter "barriers" through both policy and framing should not undermine your fundamental purpose. In the same way Ariel overcoming concerns about cost or stringency by telling consumers it is not as expensive as they think, or is recommended by Washing machine manufacturers does not imply Ariel is rubbish at washing clothes, then saying Labour is concerned about reducing the deficit over the long term does not imply an abandonment our mission of a fairer, more just society.

Using this approach to overcome barriers voters have erected to voting Labour allows those who sympathise with our aims and hopes to believe we are addressing their fears and doubts. Consider the alternative – often recommended on the centre-left – of trying to somehow distract the attention of the voter from a concern about the deficit, by focusing on some other policy – say jobs and growth. If enough voters regard a lack of commitment to debt reduction as an important barrier, then no amount of well framed distraction is going to succeed, not least because your opponents will surely not neglect propagating doubt in the voters mind. Indeed, by seeking to avoid a focus on the issue which produces the greatest doubt among voters, you may even underline their concerns about you. Imagine if Labour responded to questions on Unilateral Nuclear disarmament in the 80s by simply claiming it wasn't an issue. Or if the Tories decided that public concern over their NHS policies was best dealt with by talking about Europe and immigration (they did try this, with limited success)

If, Instead, we emphasise that we will reduce deficits best by both employing public restraint and encouraging private growth, we frame our policy in the light of voter concerns and worries.

Is this employing someone else's "Frame" to decide your rhetoric?

Yes.

It's applying the frame of the doubtful voter. I reckon they're probably quite important if you want to win elections.

*I await eagerly the publication of "White flag Labour", which has been trailed by Mehdi and Neal Lawson as a brilliant riposte to the sallow collection of Blairite Zombies who have assumed control of the Labour party through the famously pliant puppet of Blairism, Ed Balls.

**The Title is a play on the old game of it being impossible not to think of something you've been told not to think of, as Mehdi notes. It's also a play on the elephantine symbol of the Grand Old Party

*** Luntz's book came after Lakoff's but his direct political influence, over Gingrich and the GOP, came much earlier.

**** There's a danger of this lapsing into the sort of poorly understood NLP stuff that comes dangerously close to bullshit here. Forgive me if I cross the line on that one. I'm not saying you can get people to buy more beer by saying tier name when they walk in the door, or somesuch.

*****When I worked on Daz, one of the benefit barriers was that people thought, since it was cheap, it _had_ to be bad. So proving that Daz buyers were confident enough to show their clothes to the nation helped overcome that barrier. Later, one of the barriers was that Daz was cheap and brash and not something people would be pleased if others new they used, so I see the latest advertising reassures on aspiration by using popular celebs, and stresses things like good fragrance.