The Labour party got it wrong. Just not in the way you think
The Labour party got it wrong. Not, as is commonly supposed, by spending too much in government, but by allowing that charge to stick in opposition. After losing the election back in 2010, rather than effectively setting out the real causes of the financial crash Labour got itself embroiled in a lengthy leadership contest – it wasn’t until September, four months after the election was lost, that Labour had a new leader in place.
Similarly, despite backing Labour spending plans right up until 2008, George Osborne and the Conservatives were allowed to position themselves as the only prudent choice at the 2010 General election.
The hangover from Labour’s error persists today in the public’s continued reluctance to trust the party on the economy. YouGov’s tracker currently gives the Tories a 17-point lead on economic trust – 40 per cent to 23 per cent.
The argument was lost five years ago, and thus it might plausibly be argued that getting embroiled in the argument again is a fruitless task.
However it’s important to (repeatedly) set the historical record straight, especially when another egregious claim is also doing the rounds – George Osborne recently claimed that the “economy was contracting when we came to power” (it wasn’t).
And so here are two graphs which, while not exactly game-changing at this stage, are nevertheless worth looking at as a reminder of some of the nonsense emitted by the Conservatives over the course of this parliament.
Firstly, on the myth of ‘out of control spending’. As the graph below demonstrates, government debt as a percentage of GDP was well below average under Labour and rose, predictably, as aresult of the collapse in tax receipts when the economic crisis hit – as it would. In the years leading up to the 2007/08 crisis – the supposedly spendthrift years – UK net public debt was close to its lowest ratio to GDP in 300 years.
Nor was this ‘Labour’s crash’ – unless you think Labour was in power in the United States when the sub-prime housing bubble burst and Lehman Brothers collapsed. I’m sure you’re not that silly.
As for the spurious claim that the economy was contracting when the coalition came to office in 2010, in reality it was growing when Labour left office – and nosedived only after George Osborne’s ’emergency budget’ in October of that year, when he set out big cuts to public spending.
The country had to wait another two-and-a-half years before the economy started to grow again at the rate it had been growing in May 2010. In the intervening period we saw wage stagnation, ‘flatlining’ GDP and the loss of the triple-A credit rating.
So yes, the Labour party got it wrong. Just not in the way you probably think.
James Bloodworth is the editor of Left Foot Forward. Follow him on Twitter
21 Responses to “Once again on the myth of Labour’s ‘out of control’ spending”
Gary Scott
The crash was the fault of successive governments both here and in the United States. Going back to HOW this happened, SEVEN YEARS AGO, adds nothing to the debate.
Unfortunately this hijacking of the debate avoids discussion of issues voters might be interested in like jobs, housing and, the BIGGEST elephant in the room, TTIP.
I predict most voters will reach election day none the wiser and thoroughly hacked off by politicians again.
James Chilton
If anyone understands that the world is run on appearances, it’s the Tory politician. It’s very difficult to contradict a myth once it’s taken root as an established ‘truth’ in the public mind.
There’s no immediate advantage in correcting the Tory version of Labour’s “crash”. Miliband and Balls should concentrate on what can be done to repair the economic and social damage of the Cameron years.
littleoddsandpieces
Labour did not lose in 2010.
The voter turnout in 2010 was the same low turnout, after the carnage of the first world war, in 1918, which was only the beginning of universal suffrage for working class men and women.
The Tories also did not win in 2010.
Most people did not come out to vote in 2010.
Today more people are not registered to vote, as there were in 2010.
Between being unregistered to vote and not voting when people are on the electoral roll, over 75 per cent of the population are not bothering with voting and elections, even now the lost poor grey vote.
Most people do not watch TV news nor read it in newspapers, nor will they watch party political broadcasts.
The bulk of people are not aware of the massive state pension reform that has happened, and the worse to come with the
flat rate state pension next year,
that is NOT MORE but LESS and
for huge numbers of men and women
NIL STATE PENSION FOR LIFE,
when that is their sole pension provision
due to low wages throughout life.
See why, at end of my petition, in my WHY IS THIS IMPORTANT section, at:
https://you.38degrees.org.uk/petitions/state-pension-at-60-now
David Davies
No one in their right mind believes that the global economic crash was caused by anyone other than the tax dodging fraudsters of financial casinos. The disgrace is that not ONE of these criminals have been held to account, whilst brutal sanctions can be meted out to the victims.
Richard Honey
I generally agree with what you are saying, but out on the doorstep I’m finding that people who throw the ‘Labour wrecked the economy’ line at you are at least having step back a bit from their certainty when I quote a few facts at them. I had one guy who aggressively tore up my leaflet when I handed it to him initially, but at the end of a 10 min interesting chat he shook my hand. Maybe not a game changer but certainly dented his easy conviction.