“The sleaze, the nepotism and the apparent avarice are off the scale. I’m so ashamed of what you and your inner circle have done to tarnish and humiliate our once proud party. Someone with far-above-average wealth choosing to keep the Conservatives’ two-child limit for benefits payments which entrenches children in poverty, while inexplicably accepting expensive personal gifts of designer suits and glasses costing more than most of those people can grasp - that is entirely undeserving of holding the title of Labour Prime Minister.”
(Rosie Duffield MP, resignation letter to Keir Starmer, 28 Sep 2024)
Today marks the end of the new UK government’s first 100 days in office. They have not gone well. Rosie Duffield’s excoriating letter, resigning as a Labour Member of Parliament to become an Independent, expresses what many in the UK feel about how quickly the new Labour Government has dashed hopes that we would see an end to the austerity, hypocrisy, and incompetence that had characterised the successive Conservative governments it had replaced.
Austerity
Before the election, Labour promised an end to austerity. Once they got in, they announced that they had discovered a £22 billion ‘black hole’ in the public finances, which they had not anticipated. This, they suggested, meant that their promise to ‘balance the budget’ would be harder to achieve, so that more public expenditure cuts were needed and, in effect, austerity had to continue. The black hole is an excuse, as the projected £22 billion shortfall was known about well before the election took place. How this shortfall could be met - by increased taxes, by reduced public spending, by increased borrowing, by money creation, or by relaxing its ‘fiscal rules’ - is a political choice, constrained only by Labour’s prior commitment to self-inflicted and misplaced fiscal rules, and by manifesto promises not to raise taxes paid by working people..
Choices Labour has made so far, including to continue with the Conservatives’ two-child cap on child benefit payments, to stop winter fuel payments for most pensioners, and to introduce algorithmic surveillance of people entitled to disability benefit, suggest that they rate sticking to the fiscal rules as more important than relieving child poverty, preventing the elderly from freezing to death, or treating the disabled with dignity.
“Cutting the Winter Fuel Payment, with very little notice and no compensatory measures to protect poor and vulnerable pensioners, is the wrong policy choice, and one that will potentially jeopardise the health, as well as the finances, of millions of older people this winter. This is the last thing both they and the NHS need.”
(Age Concern UK, Save the Winter Fuel Payment for struggling pensioners, Sep 2024)
Chancellor Rachel Reeves claims that Labour’s continued austerity is not ‘Conservative austerity’, as she anticipates it creating the stability which is needed to stimulate the economic growth which will eventually bring an end to austerity. That’s a wish list which requires us to take a lot on trust, when trust in politicians’ promises is in short supply.
Hypocrisy
Trust is more easily squandered than earned. Keir Starmer made great play in the run up to the election that he would restore trust in politics, and put an end to the sleaze and corruption that had mired previous Conservative governments. Did he really imagine that accepting expensive gifts - designer clothes, glasses costing £2500, tickets for a Taylor Swift concert, etc - would win the trust of voters he was telling to expect continued austerity? Did he calculate that with a £167,000 a year salary he would be unable to afford to buy his own clothes? Did he think that wearing such expensive glasses would improve the optics? Was he foolish enough to believe that he could keep hidden the fact that these were freebies?
It’s not clear what favours, if any, were expected by those showering gifts on the Prime Minister and members of his cabinet. What’s more significant is the undoubted influence of lobbyists on the new government’s policies. A particularly stark example is Keir Starmer’s own £22 billion ‘black hole’ - the investment he has promised for projects to bury carbon emissions under the North Sea. This is, as George Monbiot described it in yesterday’s Guardian, “a fossil-fuelled boondoggle that will accelerate climate breakdown … the beginning of a phenomenal fiscal nightmare.”
Carbon capture and storage may be useful for a small number of industrial activities, like cement production, which are difficult to decarbonise. But it is a technology that is untried at scale, and whose effectiveness in reducing emissions is far from assured. Most importantly, the planned investment is not for retrofitting to processes that are hard to decarbonise, but for continued extraction of fossil fuels, in particular to produce ‘blue’ hydrogen (a technology choice that locks the economy into high emissions for decades to come). The Government has chosen to bow to fossil fuel lobbyists and spend £22 billion on an unproven technology that will increase overall emissions and allow them to carry on extracting and burning fossil gas (much of it imported Liquefied Natural Gas). It’s money that could have been used to raise the insulation standards of social housing throughout the UK - addressing the cost of living crisis, raising health standards, and spreading new job opportunities throughout the country, as well as reducing carbon emissions and the need for new electricity generation capacity. Starmer chose, instead, to boost the profits of Big Oil and Gas.
Lobbying doesn’t always come directly from big business, but can be mediated by personal connection. The many family links between Labour MPs are well known, and this, arguably, may not signify nepotism. But where Government Ministers have children who identify ‘trans’, there is a distinct possibility that this will influence policy on ‘gender’ and women’s rights, and further the interests of the gender industry. As Helen Joyce has noted, parents of such children have become enormously influential in determining the ‘inclusion’ policies of the organisations they lead:
“There are a lot of people who can’t move on from this (allowing children’s bodies to be mutilated, and letting men access women’s spaces). And that’s the people who have transitioned their own children … I’ve lost count of the number of times that somebody has said to me of a specific organisation that has been turned upside down on this, ‘Oh, the deputy director has a trans child’ … It is a fight to the death as far as they are concerned.”
Stephen Kinnock (Minister of State at the Department of Health and Social Care, and son of former Labour leader Neil Kinnock) has a daughter who identifies as ‘non binary’. Yvette Cooper (Home Secretary, and wife of former Labour Chancellor Ed Balls) has a son who is a trans activist drag queen. There may be others. I have no idea whether there is any basis to the rumours that one of Keir Starmer’s children identifies as ‘trans’, but this could explain the Prime Minister’s ongoing confusion about ‘gender’ (most of the time he says he has a son and a daughter, but he has said he has two daughters, and on another occasion that he has two sons).
Earlier this week, the government announced that its new Office for Equality and Opportunity will be delivering, as one of its key immediate priorities, a full ban on ‘trans-inclusive conversion practices’. Such a ban risks criminalising therapists who don’t automatically put ‘trans’ children, many of whom are same-sex attracted, onto a medical transition conversion path. It’s a depressing sign of the extent the Labour Party has been captured by the gender industry that mutilating young people’s healthy bodies and ‘transing the gay away’ have become key immediate priorities of the new government.
Incompetence
Rosie Duffield didn’t refer in her resignation letter to the incessant bullying she has been subjected to by men in her party for supporting women’s rights. She did allude to it in a subsequent television interview, though (at 41m):
“It’s very clear that ‘the lads’ are in charge, they’ve now got their Downing Street passes. They’re the same lads that were there briefing against me in the papers, and other prominent female MPs. I was really hoping for better, but it wasn’t to be.”
(Rosie Duffield MP, Sunday with Laura Kuenssberg, BBC 29 Sep 2024)
It was not long after that interview that ‘the lads’ removed Sue Gray, the woman who was Keir Starmer’s Chief of Staff, blaming her for Starmer’s numerous errors of judgement and the overwhelming impression of incompetence that this conveyed.. She has been replaced by head lad Morgan McSweeney (husband of Labour MP Imogen Walker).
Poor communication skills and chaotic office organisation are symptoms rather than causes of the incompetence of Keir Starmer’s government. Its policies, and particularly its pursuit of economic growth as the most important of its five missions, have incompetence at their heart.
“Anyone who believes in indefinite growth in anything physical, on a physically finite planet, is either mad or an economist” is a quote usually attributed to the rare sane economist Kenneth Boulding. Key limits to growth have already been reached, and we are living with the consequences, including climate instability and accelerating biodiversity loss. Labour appears not to realise that its prioritisation of economic growth not only devalues nature, it makes its Net Zero by 2050 objective harder to achieve. Not only that, prioritising economic growth over meeting basic needs delays improvement in the wellbeing of those on low incomes.
In 1942, another sane economist,John Maynard Keynes, gave a succinct explanation of how Britain would be able to pay for post-war reconstruction: “Anything we can actually do we can afford.” Rachel Reeves reverses this. She believes, in effect, that if we cannot afford it, we can’t do it. She set out her thinking in a meeting with Labour MPs on 9 September. “If we saw, as I believe, that economic stability is the hallmark of Labour governments, there is no limit to what we can achieve”, she claimed. “Because with that stability comes investment. With investment comes growth. With growth comes prosperity”.
Reeves is determined to cut public expenditure in her forthcoming Budget. Again, she is following a discredited economic doctrine, the loanable funds theory that was demolished by Keynes nine decades ago. This discredited theory asserts that the supply of loanable funds is fixed, so that if government spending increases, private investment must fall. But the supply of loanable funds is not fixed. As even the Bank of England (Reeves’ former employer) now recognises, banks act not primarily as intermediaries, transferring deposits from savers to borrowers, they also create money by issuing loans. In the real world, both bank lending and public spending create money and enable growth. Public spending cuts reduce rather than increase investment, and as a result they slow, not quicken, economic growth.
“Practical men who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist. Madmen in authority, who hear voices in the air, are distilling their frenzy from some academic scribbler of a few years back,”
(John Maynard Keynes, General Theory ch24, 1936)
Labour’s pursuit of economic growth conflicts with both its commitment to tackle climate change and its desire to improve the living standards of those on low incomes. Not only that, its central mission, to increase the economy’s capacity for growth, will fail if it continues to be constrained by fiscal rules that are justified only by the false doctrines of defunct economists.
It’s not going well, and there’s no sign of it getting any better.