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
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21 Responses to “Once again on the myth of Labour’s ‘out of control’ spending”
Phil
Disagree with your last point, Brown didn’t fail to persuade people – he reduced regulation on the banks leading to this mess!
Norfolk29
Brown was like a wounded bull elephant crashing through the jungle for the last two years of his time as PM. What was needed could not be provided (a piece of lead inserted into his ear, using a high calibre rifle). And he still wanted to lead a coalition for two years after leading Labour to its worst post-war defeat.
Leon Wolfeson
Ah,so because he wasn’t murdered…
Norfolk29
“For three years, Downing Street under Brown had been a sleepless bunker,
powered by the tyrannical rages of a mortally wounded prime minister
and the tribal loyalty of his ministers and advisers.”
This is a quote from today’s Guardian on “The making of Ed Miliband” by Rafael Baer. I don’t know where you were during 2007 -10 but those of us who were members of the Labour Party were suffering from Browns bunker mentality. Just as Anthony Eden proved Churchill’s prediction right that “Anthony is not up to it” which caused Churchill to hang on until 1955 (when he was 81), so most of Blair’s circle knew that Brown was “not up to it”. At these times, in days of yore, and officer fell on his sword. Not now.
Leon Wolfeson
Oh right, you’re mad he didn’t commit suicide. *yawn*