An analysis by @JaneWatkinson: Whose economic policy would help Britain the most – the Conservatives or Labour?

Jane Watkinson examines Tory and Labour economic policy - Do either of them really provide a means to the current economic crisis?

Labour Party 1957 Poster

In last week’s seminar, my lecturer discussed the paradox of the Labour Party’s economic strategy. Such a paradox I find rather illuminating given the ongoing debate and discussion by the mainstream parties of the appropriate response to the worsening economic crisis, in the backdrop of a neoliberally controlled and defined Eurozone that is experiencing some of its most troubling times since its construction alongside banks across the world being downgraded by rating agencies, as people from the USA to Greece protest against the increasing neoliberal slash and burn approach.

Labour have just announced a campaign for “growth and jobs”. This is all good. It’s what is needed. However, as we discussed in our seminar the actual construction of Labour’s economic policy in retrospect by the likes of Darling and then Johnson, before Ed Balls could have a real say on the economic direction of Labour after his influential Boomerang speech, has – like the government – constituted the economic crisis as a crisis of debt, not of growth. Yes, the two interrelate. But both Labour and the Tories have constructed an economic policy mainly on the provision that what is needed is cuts and for the deficit to be either halved over a parliament (Labour) or for the structural deficit to be eradicated (Tories).

There are several important points here. Firstly, the economic system we operate within now, that being capitalism is based upon debt. Cameron’s economic illiteracy shined through in his party conference speech where he seemed to suggest that paying off the banks’ and people’s credit cards debt will solve the crisis. That in itself is a massive indictment of capitalism, and given Cameron’s policies and discursive constructions you would be wrong to assume that was what Cameron had in mind. Secondly, constructing it as a crisis of debt means that Labour have signed up to an economic programme of severe cuts. Even Darling said that Labour’s cuts would have been worse than Thatcher. Now, to then advocate a strategy of growth goes against the actual policy stance of cutting at such an extent. You can tackle debt through a strategy of growth however. Nevertheless investing in jobs and capital infrastructure is a different policy direction than cutting valuable services and not committing to reversing any of the current governmental cuts (if referring specifically to Labour here). If you lead on the premise of growth, it is actually more beneficial when it comes to cutting debt than basing an economic programme on cutting, as being demonstrated by the failure of such a method world-wide as a double-dip international recession is again on the cards. The second round of quantitative easing and the ‘Plan B’ by the government is a testament to this.

The government borrowed money and created the NHS system after the War, that was a strategy of growth; this mediation of ideas and interpretation was central to the political consequences/policies. This illustrates the centrality of ideas and ideology in terms of political tactics and political governance. Likewise, interpreting globalisation as an inevitable process that politicians have no control over, allows for a clearer ‘justification’ of policies such as low corporation tax; if we construct globalisation as a term/analytical construct that is masking an array of social processes such as financial liberation that need studying and consideration in their own right, the meaning and importance of globalisation is changed and the policy implications also change. Globalisation is paving the way for greater economic freedoms within our society. But one could argue that globalisation in itself has created our current fiscal situation – as such should it really be the dominant policy catalyst when designing economic policy?

In sum, a critical consideration of the interpretation politicians have of events and the effects this has upon political policy is central to constructing a radical political counter-hegemony to the dominant outlook and policy direction of the government. This brings us to the question of who’s economic policy would help the nation the most – the Conservatives or Labour?

Jane Watkinson is a sociology graduate and currently undertaking an MA in politics. A member of the Green Party, but with anarcho-communist leanings, Jane keeps a blog at Jane’s Political Ramblings that advances left wing, feminist and social justice principles. Jane is also a director for the progressive social enterprise, SilenceBreakers. You can find Jane on Twitter @JaneWatkinson