Umunna’s arguments expose the ideological divisions in the coalition

Chuka Umunna’s speech today on a ‘One Nation’ active industrial policy - in which he praised Michael Hesletine - exposes ideological divisions in the coalition.

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By Jeremy Cliffe

Improbably, shadow business secretary Chuka Umunna began his speech this morning by paying tribute to a Thatcher-era cabinet minister.

The target of his praise? Michael Heseltine. Drawing on various examples from the 1980s and 1990s, Umunna argued the former deputy prime minister “stood against those in his party who in the name of ideology argued against government activism being used to boost business and private sector investment”.

The battles between the interventionist Heseltine and free-market ideologues on the Tory right, Umunna says, are being played out again today:

“For Portillo and Heseltine in 1994, read George Osborne and Vince Cable in 2012.”

It’s true what they say: history repeats itself.

The comparison illuminates an important point about British politics: that the territory contested by the three main parties today is what one might call that of ‘One Nation’ politics. At the Liberal Democrat Spring Conference on the weekend, Nick Clegg asserted that the party was the “only true One Nation party”.

Meanwhile The Economist has described David Cameron as a would-be “One Nation radical“, and the prime minister has done much to cultivate this style (note the emphases on national unity in his 2010 and 2011 party conference speeches).


See also:

Cable: Coalition lacks “a compelling vision of where the country is heading” 6 Mar 2012

Transparency, accountability, responsibility: Miliband’s “one nation banking” principles 3 Feb 2012

What is patriotism in Britain today? 27 Nov 2011

Chuka Umunna: My vision for One Nation Labour 12 May 2011

Heseltine adds to confusion over Local Enterprise Partnerships 24 Nov 2010


What Umunna’s speech today did was to park Labour’s tanks firmly on the well-manicured lawns of the One Nation tradition. Not those of One Nation Conservatism per se: Labour’s mission is progressive. To quote Umunna, it recognises the need to change and modernise the economy, to let go of the ‘old orthodoxies’.

No, this was a call for a forward-looking active industrial policy; government and business working together to identify, support and extend Britain’s competitive advantages in the global economy.

At the heart of the speech was an argument about the scope and limits of what government can do. Growth has to come from the private sector, but there are some things government is uniquely well placed to achieve, the shadow business secretary said. It can “improve the health and functioning of markets”, can “correct market failures” and can help determine whether growth is socially beneficial or socially corrosive.

Through regulation, research and development budgets, and support for industrial clusters, it can stimulate new private sector activity. Above all, in partnership with business it can set a strategic direction, building confidence and certainty by throwing its backing behind growth industries.

The benefits of using the weight and long-term vision of government to steer the economy in a certain direction are numerous. It is increasingly noted that Britain’s competitors already do so: from Germany’s national investment bank KfW to the US Small Business Administration and Singapore’s Standards, Productivity and Innovation Board (SPRING).

As Umunna said today, Britain needs its own industrial infrastructure, building on our existing institutional strengths.

Coming hot on the heels of Ed Miliband’s call for a ‘One Nation’ banking system – “serving every region, every sector, every business, every family in this country” – and the Labour leader’s speech last week advocating a more patriotic manufacturing policy, Umunna’s words today reinforce the party’s claim to be the standard bearer of a modern One Nation politics in the tradition of Heseltine and others.

And when the dominant view in the coalition is that government should ‘get out of the way’, the “clear and confident message about how we will earn our living in future” (to quote the leaked letter to the PM from sidelined business secretary Vince Cable) is Labour’s to articulate.

If this morning’s speech is anything to go by, the party is well on its way to doing so.


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