Zhou Enlai, the Chinese politician who was Mao Zedong’s long serving deputy, was once asked what the effect of the French Revolution had been. His answer, that it was ‘too early to say’, has often be held up as an example of Chinese politicians’ supposed propensity to confucian long termism.
The step from the Chinese Communist Party in the era of the Cultural Revolution to the Labour Party in the era of Corbynmania is a long one but ‘it’s too early to say’ was something of theme of this week’s Labour Party Conference.
It is tempting to paint the election of the least likely figure ever to lead a major British political party as the greatest of gifts to his opponents. Mr Corbyn is the only leader in modern times to have come straight from the back benches without ever having held a front bench position in either Government or Opposition. His record as a rebel speaks of the impossibility of his maintaining any sort of coherence within the party. He should be a complete disaster. If he was intending to behave like a conventional party leader he almost inevitably would be. But he isn’t, instead he’s taking the Labour Party into completely uncharted territory. When he says he wants to do things differently he means it. The problem is that when navigating in uncharted territories there is no map to tell you where you might go. And there is no map to help anyone else understand where you might go.
Effectively in respect of the Labour Party all bets are off. No one knows how the Party will arrive at its policies, or if it’s MPs and even it’s shadow Ministers will be expected to argue for them. In terms of engaging with the party there is effectively a blank sheet of paper or even the distinct possibility that the party will choose to ‘go paperless’.
Economic policy is no exception to the new thinking. The headline grabbing People’s Quantitative Easing policy that gained much traction in leftish circles during the Party’s leadership election has been unravelling impressively quickly. While QE as practiced by the Bank of England, in the aftermath of the Financial Crisis was not without its detractors, almost every economist would agree that enacting it during a period of growth would be rampantly inflationary. As originally articulated it also would have driven a coach and horses through the Bank of England’s independence. So there is now talk of simply reviewing the BoE’s mandate. That is perfectly reasonable (in fact arguably overdue) many central banks, notably the Federal Reserve, have wider mandates which look at a range of indicators, not just an inflation target. A Review might be a useful tidying up exercise, but to pretend that the BoE as it is now myopically focusses on inflation is disingenuous, one might almost say myopic.
Another area of concern is the attack on so called ‘Corporate Welfare’, money that Business receives from the State. Some very big numbers have been bandied around. There are certainly some questionable tax breaks out there for activities as diverse as film production and getting a late night taxi; but in order to get to the very big numbers you have to make a) make some pretty heroic assumptions about how much tax can been clawed back from avoidance schemes and b) include some pretty important strands of industrial support including Capital Allowances, R&D Tax Credit and the Regional Growth Fund. That’s not to say that Labour politicians want to abolish these things, they don’t, but that the state of creative ambiguity in which the Labour Party will be operating for the foreseeable future will mean that it will be almost impossible to nail concrete proposals down.
Normally the electoral cycle forces politicians to confront uncomfortable choices; manifestos have to be costed and questions from the media become more acute as the shadow of the ballot box looms. However in a scenario where a party leader can speak for an hour to his Annual Conference and not mention a future General Election, perhaps that is now an example of ‘outdated thinking’ – if that term is not too redolent of the Cultural Revolution...
The only secure prediction for the next few years for the Labour Party is that the times will be ‘interesting’.