Labour is on the verge of a disastrous, and false, shift to the left
Posted by Ian at 2 13 AM on Sunday, June 13
WOULD-BE Labour leaders last night queued up to say they would raise taxes if they got back into power.
In an extremely significant head to head that was largely ignored because of the World Cup, all five potential leaders queued up to say they would tax more and carry on spending, as if the current £163 BILLION deficit didn't exist!!
Shadow health secretary Andy Burnham said the party had felt unable to introduce new taxes for fear of the media reaction, and said that as leader he would have taxed banks and brought in a “death tax” to pay for care for the elderly.
At a hustings in London, shadow energy secretary Ed Miliband also called for the 50% upper rate of income tax to be permanent and said the 50% tax on banking bonuses above £25,000 should be made permanent.
Left-wing candidate Diane Abbott said New Labour had made a “fetish” of the tax question and argued that tax rises should play a much larger part in bringing down Britain’s state deficit.
None of them aplogised for the massive debt, nor did they show any inclination to pay it off anytime soon.
Both shadow foreign secretary David Miliband and shadow education secretary Ed Balls accused the Tory-Liberal Democrat Government of overstating the dangers of debt to cover up massive cuts.
And Mr Balls said he would take much longer to cut the country’s deficit.
“It is important to get the deficit down but... arguably the path we set in government was too fast,” he told the audience of around 1,000 activists.
“If you try to do it too fast, you actually end up stifling the economy, leading to more unemployment, slower growth and in the end a bigger deficit.
“I think we need a combination of some tough spending decisions but also to defend the tax rises which we put in place and they are now trying to reverse.”
Mr Burnham said Labour did not go far enough in raising tax while in power: “Personally, I think we were too timid on tax throughout our time in office.
“We got ourselves into a position where we thought we could never raise a new tax because we would be torn to pieces by the press and we have to get out of that.
Ed Miliband agreed: “I think we were too timid on tax and too much in the shadow of the ghosts of the 1980s. I have said that the top rate of tax should remain permanently... I think there is a case for extending the bonus tax on bankers too.”
And Ms Abbott said: “Tax for New Labour became more about presentation than making a pragmatic judgement about what the economy needs and the function of taxation in the economy.
“We still have some of the lowest tax rates on the well-off and financial services in Europe, so even if we were to ally ourselves more with our European neighbours, that would not be so terrible.”
David Miliband said that European economies were in danger of sparking a double-dip recession by taking an approach of “competitive austerity” by cutting their public spending to reduce the deficit only to see the economy falter, jobs disappear and the tax take decline.
He said he would not back away from Labour’s argument in office that the deficit reduction burden should be shared by spending cuts and tax rises on a ratio of about two to one.
And he won applause by adding: “The broadest shoulders should certainly bear the greatest share of the burden.”
There were no significant clashes between the five candidates at yesterday’s hustings, but the biggest applause was for Ms Abbott when she said that many people might think that she “doesn’t look like a credible leader”, before adding: “In the 21st century, in an internationalised world, this might just be what the next leader of the Labour Party looks like.”
She won laughter from activists by smirking broadly as Mr Burnham said that all the candidates had been “loyal servants” of the Labour government.
And she cited her opposition to the war in Iraq and the abolition of the 10p income tax rate as she said: “I have never been a New Labour minister but I called all the big issues right.”
The most significant thing about yesterday's hustings is not the fact that they pledged to raise taxes - it was a hustings held by the leftie Compass Group after all, it was the fact that NONE of the candidates were prepared to admit they had carried on spending while Rome burned.
In 10 days George Osborne will present his Emergency Budget, and it is hard to see from yesterday;s offerings who, from the Labour benches, could come up with a better or more realistic alternative to large spending cuts.
Until the Labour candidates start to analyse what went wrong with the economy, and begin to develop an alternative model all of them are doing a great job of preparing Labour for a long period in Opposition.