What does the Conservative Party have to do to win the next election?

By Matt Beebee

The 2010 General Election should have been a clear Conservative victory. It wasn’t. 64% of those that voted backed other parties. This was a perplexing outcome given the Tories were facing a tired and battered Labour Party, trudging through a global financial crisis with rising public debt. Under the leadership of the young David Cameron, who had shifted the party towards the centre ground, victory looked all but certain. Yet failure to win outright forced the Conservatives’ hand into a coalition with the Liberal Democrats; a relationship that has been tetchy to say the least.

The relatively poor show was always going to give the Conservatives, who were polling 20 points ahead of Labour before the 2010 election, an uphill struggle in the 2015 general election given the tough decisions they would have to make in government – on the economy in particular. Former Cabinet minister Michael Portillo has blunted declared “the Conservatives appear to be doomed” at the next general election. He could be right; no party has ever increased its share of votes at a subsequent general election since 1955.

With such pessimistic inevitability, should the Tories concede themselves to losing the election? No. Much could change during the remaining two years of government, but the Tories have three big obstacles they must – and more importantly can – overcome to win the next election.

First, there is the matter of the Labour Party. Despite Labour consistently polling around 10 points better than the Tories, they come out worse in two important polls: preferred leader and economic competence. Although it iz grossly unfair to dismiss Ed Miliband as a leader based on his physical appearance, the electorate do seem to lean favourably towards David Cameron’s style and aptitude as an orator. Labour’s continual dithering over turning ideas into policy, if left too late, could play into the Tories hands. To their credit, they have a plan and are sticking to it. Likewise, Ed Balls, Labour’s shadow chancellor, is considered a prime target to personify Labour’s ineptitude with his rowdy, firebrand style of politics. The Conservatives will seek to push this idea; Labour has no strategy for taking tough decisions in government and opposes with little in the way of alternative policy.

Then there is Europe; the Conservative Party’s ‘elephant in the room’. Cameron has already committed himself to an in/out referendum in 2017 if he is Prime Minister. The paradox is that Cameron does not wish to leave the EU; he wishes to reform it politically while retaining the economically vital single market. He has felt the urge to accommodate the Eurosceptic crowd given the surge of UKIP and the perceived natural Euroscepticism because of Britain’s island culture. This pandering should be avoided. A YouGov poll from January stated 34% would vote to leave the EU while 40% would vote to remain. Cameron should instead be pushing for a reformed EU treaty – something he is confident of doing – that reclaims parliamentary sovereignty and supports economic liberalism, demonstrating that he does worry about European encroachment while emphasising that leaving the EU single market is to the detriment of the UK’s private sector. This should win back the Eurosceptic defectors and render a dangerous referendum unnecessary. Despite its many troubles, voters must remember the EU is still the world’s largest market and the UK’s major trading partner.

However, it is the economy that wins elections. Although ComRes, a polling consultancy, found the electorate are more likely to trust ‘Team Cameron & Osborne’ over ‘Team Miliband & Balls’ on the economy, this should not cause complacency. The deficit may have fallen year-on-year since 2010, but only minimally; public spending is continually higher than it should be, largely due to automatic stabiliser payments and continual ringfencing of certain government departments – international aid is a particular bitter pill for a domestic electorate facing squeezes. Removing ringfencing will allow for efficiency within departments, further reduce departmental spending on waste, while also freeing up money for capital spending projects, generating multiplier effects on job creation and consumer demand.

Unemployment continues to creep above 2.5million, too. More should be done to cut unnecessary red tape that hampers job creation. Pressing ahead with radical reform to the welfare system, although painful, seems to strike a chord with the electorate. If people can be pushed back into work through welfare and regulatory reform, job creation and growth will soon pick up. If growth, rising employment and greater deficit reduction can be achieved the Tories can at last claim to have moved the economy out of the doldrums, significantly boosting their electoral hopes.

Securing an outright majority in 2015 will be a tough ask for the Conservatives given the precarious position they defend and the fragility of the economy is by no means bound to change, despite recent upturns. With a clear focus on the right policy choices over the next two year,, so to outmanoeuvre their main rivals, the Conservatives stand a better chance of re-entering government in 2015.

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Labour and the EU referendum

By Alex Bryan

Over halfway into the current parliament, characterised predominantly by economic austerity, one of the main criticisms of the Labour Party from the left (and indeed centrists rapidly losing confidence in George Osborne’s strategy) is that, though they have opposed the coalition policies, they have not done enough to oppose the underlying assumptions that have gone with them. The best example of this is the cut in real terms to benefits recently passed in the House of Commons. The rhetoric which the government used to try and sell the policy was essentially one of divide-and-rule, pitting the ‘strivers’ against the ‘shirkers’.

The reason for the difficulty Labour had in getting their point across was that they used the specific terms the coalition employed to attack the policy. The reason the coalition employed the ‘strivers and shirkers’ line was because the logical conclusion of employing such a divide is a policy similar to theirs. For Labour to attempt to stop that policy whilst simultaneously using rhetoric which presupposed its validity was a doomed strategy.

Since the Prime Minister announced that a referendum on Britain’s membership is to be held in the next Parliament (if the Conservative Party wins a majority, which looks fairly unlikely), commentators in general have seen it as a masterstroke on the part of Cameron and have scorned Ed Miliband’s lacklustre response. However, one must remember that in terms of both the 2015 election and the possible 2017 referendum, it is early days yet.

It is clear that Labour must begin to create a strategy to argue against the Conservatives though, because it is unlikely that the Tories will not place the referendum pledge at the heart of their campaign. And in order to succeed, Labour must learn some lessons from the benefits debate.

Not every Conservative is a Eurosceptic, but it is clear that the campaign to leave the EU will be led by Conservatives. This group has an immediate advantage in that the British public is by and large anti-EU. It will also be helped by the fact that the bulk of the British media takes a strong anti-EU position.

But they still need to make their argument. It seems likely that the argument this coalition of Eurosceptics employs will follow the guidelines set out by UKIP over the past few years, concentrating on sovereignty, EU bureaucracy and the supposed economic loss that comes from being an EU member state.

The pro-EU side (which, at least until 2015, will be most strongly represented by Labour) cannot simply oppose these points if it is to be successful. Much like the debate over benefits, to debate the EU over the terms set out by those against it would result in failure. In order to convince sections of the public that the European Union is not a hindrance to Britain and the British economy, Labour and the Lib Dems must redefine the terms of the debate.

The centrepiece of the pro-EU argument cannot be the economy. Firstly, the economic benefits or losses are so difficult to calculate, with so many conflicting conclusions, that such a stance would convince few outside of those already pro-EU. Secondly, the reason UKIP have been so successful in pushing an anti-EU agenda is because the issues they have focussed on are emotive. People will get passionate about protecting British sovereignty. People will admittedly get passionate about saving British jobs, but the anti-EU side can make that argument in a far more emotive way by concentrating on immigration. People will not get passionate about a macro-economic argument about growth, even if the economic woes of our time persist in 2017.

Labour and the Lib Dems instead must concentrate on the social goods of the EU, so rarely focussed on. The Conservatives will make an argument that the Working Time Directive, the existence of the European Court of Human Rights and the Human Rights Act are a drag on the economy, an attack on British sovereignty and overly bureaucratic. The pro-EU side needs to focus their campaign on issues like these, for there is significant scope to persuade the public that EU membership protects them as workers and indeed as individuals more effectively than any domestic legislation could.

It is an essential aspect of the British constitutional tradition that any law, no matter how important, can be repealed or replaced by a simple majority vote in Parliament. Whilst this provides a great flexibility for change, it makes entrenching rights very difficult. Our membership of the European Union entrenches the rights of British citizens more deeply than any domestic law could do. By emphasising this, and other social benefits to the EU, Labour and the Lib Dems might be able to begin to overturn the immense Euroscepticism of the British public.

The Diplomatic Value of the EU – Why the current debate on British EU membership misses the mark

By Beth O’Brien

For a snowy week in January, current affairs enthusiasts have been spoilt for big news stories. A hostage crisis in Algeria, Hillary Clinton testifying on Benghazi, North Korea threatening “a new confrontation with the US”, and a declaration from David Cameron that a re-elected Conservative government will hold an in-out referendum on European Union membership.

Debate about EU membership invariably centres around the economic. Should we follow the working time directive? What about the Euro? However, I submit that these discussions are all but irrelevant. The European Union represents much more than purely an integrated market. The diplomatic value of the European Union cannot be understated. To leave the EU now would be a gross oversight by the government of the United Kingdom, and so the current concerns about economic cost of membership should be sidelined.

All of the news stories I mentioned above had a decidedly international flavour, and they all relate to something that could impact the UK in some way. The 21st century presents its own challenges that we are yet to fully understand. There are established non-state threats, such as Al Qaeda and associated groups. However, there are also state-based threats to international security. Over the last week, North Korea has declared its intention to violate UN Security Council requests to cease testing rockets. According to state television, these rockets are designed to be used to attack the US in the near future. Also this week, Benjamin Netanyahu’s party was returned to power, albeit only just. Netanyahu declared his priority to be the prevention of Iran’s nuclear weapons programme. It is clear then, that there is a complex list of possible threats to domestic security.

Membership of the European Union offers the UK another outlet to participate diplomatically on security issues. Particularly in relation to the Middle East, Europe is in an important geopolitical position. A unified, strong position and shared policy from the EU will allow a more effective combating of potential threats. Indeed, the European Union website states “acting together as the EU, the 27 member countries have far greater weight and influence than if they act individually, following 27 different policies.” Non-participation in this matter not only drastically reduces the weight of influence we as a nation have, but may also weaken the position of the EU. For what is a unified European viewpoint without one of its most prosperous nations?

“But isn’t that what NATO’s for”, I hear the Eurosceptics cry. Granted, NATO does represent an invaluable web of allies for the UK, and given it is a military alliance, can deter potential threats from acting at all. My argument in response to this is twofold. Firstly, the EU includes a number of states that are not in NATO, and so a unified position from both the EU and NATO would have greater coverage. This is especially important when we consider the potential influence of ex-Soviet Union nations. A unified position that may, in some respects, cross cultural boundaries, may have more influence than a purely ‘Anglo-American’ statement. Secondly, the European Union is not a military alliance. Diplomatically, this can appear to be less ‘confrontational’ than threats from NATO.

Regardless, I believe the more avenues we have to present our own specialised security needs, the better. Membership of the EU creates an environment for us to liaise with the other major European powers without the influence of America. To lose this capacity for influence would be to seriously damage our own security interests in the future.

As an aside, it may be relevant here to mention that we were only at war with some of the nations of Europe 70 years ago. To say that this is not relevant is, in my opinion, to come from the false assumption that war between modern European states is a theoretical impossibility. Before World War I began in 1914, we existed in “splendid isolation” from mainland Europe, choosing only to enter into military alliances to prevent a hegemon emerging on the mainland and threatening British sea trade with the Empire. Before World War II, Hitler (yes, I am Godwin-ing this) admired Britain and her society, openly considering the possibility of a formal alliance. Of course, I am not saying if we leave the EU we will war with mainland Europe, nor will membership permanently prevent a possible altercation. However, we cannot foresee what challenges the rest of this century and beyond will bring. Distancing ourselves from our European allies would be foolish, no matter the economic implications.

Our relationship with our allies within the confines of the EU is worthy of debate. Membership as a whole, I would argue, is not. If the referendum does come round, I hope campaigners will consider other factors outside the economic, and see the EU for what it really is – a mechanism for cooperation and alliance in an increasingly unstable world.

George Osborne and the Concept of ‘Yellowism’

By Kirstin Farnie

George Osborne would like to have us believe that instead of going to work first thing in the morning we should all be looting- blazing pitchforks in hand- any homes where the curtains are still drawn, demanding to know why the inhabitants aren’t at work. It seems George has never come across the concept of working night shifts- but he can’t know everything, can he? Just as your English teacher said ‘write about what you know’, Osborne seems to deliver economic policies about the small section of society he knows.

Don’t worry, I’m not planning to write a ‘Casual Vacancy’ spin-off series and bore you all with one-sided socialism. And it might seem silly to read into one comment Mr Osborne made this morning during a radio interview. But Osborne’s comment about drawn curtains suggests that he is still working from an outdated crib-book entitled ‘How to recognise different social classes’.

Osborne’s welfare cuts are designed, he says, to prevent people who feel they’re hard-done-by from stock-piling benefits that ought to be given to people who actually are hard-done-by. From personal experience, I can tell you that it is relatively easy to make any minor physical disability sound life-changing just to get an extra fifty quid a week. I know several university students who- perfectly legally, but somewhat immorally in my opinion- cheat the system so that they get a bigger student loan. I think this is very unfair, of course I do. But the experiences I’ve had have taught me that benefits cheats are a socially mobile group.

It isn’t that long ago that we believed in Britain that poverty was the result of a weakness of character. Although he daren’t say it explicitly, Osborne’s comment about benefits cheats having a lie in every day shows that still views society as a collection of stereotypes. If he really wants to make society fairer, he needs to understand that the national sense of entitlement has become epidemic. It might have started with the chavs, but its inexorable spread (apparently there were some monkeys involved somewhere along the line) has left us in a society rife with it. Political efforts to find the cure have so far been unsuccessful, simply resulting in violent protests and resentment. Maybe it’s time for politicians to realise that they need to invest a bit more time in researching their vaccine before they hail it as the miracle cure it to the rest of us.

Osborne doesn’t seem to have grasped that the national sense of entitlement doesn’t just affect rioting teens who ‘know their rights’: in the age of Twitter and Facebook, everyone has an arena to express themselves in. We’ve adapted to this increased access to expressive platforms by feeling that we all have the right to tell everyone our toast-eating habits free of censorship.

Everyone feels it’s their human ‘right’ to blurt out their opinions, whether or not they’ve properly thought about them, and usually without recourse to any form of evidence.

It used to be that only people with an opinion worth listening to was invited to express it publicly, but now everyone and anyone can tell the nation exactly what they’re thinking. This sense of entitlement has broken down the respect we once had for authorities, and whilst I don’t want to return to an intellectually hierarchal society, I am concerned about the effects of this sense of expressive entitlement. I believe it is this that led someone to deface a much-loved work of art in a revered art gallery this weekend. The culprit wanted to express the artistic movement of ‘yellowism’. In protest, I fully intend not to give his movement any more attention. Treat others as you would be treated, goes the old saying, and the disrespect that the vandal showed to the hours of work Rothko must have put into creating his mural demonstrates that he believes that his right to express himself is more important than Rothko’s right for his work to be respected. Rothko wanted the room in which the mural was displayed to be spiritual, and now his right to express himself has been violated.

Social media has turned us all into attention seekers, and we live in an era where any publicity is good publicity, so chances are there will be a ‘yellowist’ wedding on the cover of ‘Hello’ before the year’s out.

The British Chambers of Commerce and the question of growth

By Matt Kilcoyne

The British Chambers of Commerce has released the findings of its survey of 7,593 UK firms and it is a mixed bag of results for the UK economy. Overall the BCC, which represents over 104,000 UK businesses, found that the British economy had grown in the third quarter of this year by around 0.5%. This represents a stark departure from the gloom earlier in the year where it’s estimated that GDP shrank by 0.4% Q2 and 0.2% Q1 and will be a welcome relief for the British chancellor George Osborne.

Yet this headline figure of growth, which happily for the Conservatives appears right in the middle of the Labour conference, does come with some heavy caveats. Namely, that whilst the top line figure appears positive, the underlying economy is hurting and almost all key balances had worsened in Q3 compared to Q2. Indeed the Government’s much lauded export lead growth policy, designed to rebalance the economy away from over-reliance on finance, is suffering with the third quarter levels dropping to a similar level as the end of 2011. This report coincided with the release of the Purchasing Managers’ Index which measures economic indicators and where an number above 50 represents expansion, below contraction, with the export PMI down from 48.8 to 48 Aug-Sep and the sixth month of continuous decline.

It doesn’t even stop there with manufacturing at 48.4 (well below the market expectation) and employment at 47. In addition to this bad news the input price for firms rising from 48.8 to 57.5 whilst output price fell showing that “firms have struggled to pass on the increase in their costs to customers”

BCC Director General John Longworth said: “Economic growth is weak and businesses are less confident and less likely to invest than they were at the beginning of the year “The BCC’s survey results should be a clear signal to Government that more needs to be done to stimulate growth alongside continued deficit reduction. Despite official estimates, we believe the economy is still growing, but it is slowing. We need immediate measures now to support confidence and investment, a radical long-term growth plan, and a continued commitment to deficit reduction.”

The BCC’s call for new means to stimulate growth will chime with UK voters that have increasingly become cautious on spending cuts with more and more wanting cuts done more slowly and the Coalition increasingly seen as managing the economy poorly.

Yet for all this woe it should be noted that the BBC and its members really do think that the economy is growing and that their businesses are surviving. This is a call for animal spirits to be revived and to get the British economy back to life. The BCC notes that the Liberal Democrat and Conservative coalition has policies in the pipe-line to get us moving again and wants to see them implemented quicker “such as implementing plans to create a British Business Bank as well as far-reaching proposals to unlock infrastructure investment”. These calls should ring warning bells for Labour leaders as businesses are not calling for Labour’s ‘Five Point Plan’ but for more Coalition policy.

If Labour are to gain back the some 5 million voters that deserted them between 1997 and 2010 then they will need to restore their economic credibility and one of the easiest ways for them to do this is to get the confidence of businesses and their workers. Whilst they’re on the wrong side of ‘wealth creators’ they will also be on the wrong side of the argument and quite possibly the wrong side of the house for the rest of their agenda.

Finally, to end on some good news and some brilliant news for the areas concerned, the economy in some of our most deprived communities is recovering at a pace well above average with Liverpool and Norfolk bucking the trend of negativity. Liverpool’s Chamber of Commerce saw optimism in sales, orders and exports with manufacturing sales performance is at the highest level since quarter four 2010 and orders at their highest since 2007; confidence follows mass investment from Car Industry giants providing job security and growth opportunity for other firms in the region.

If George Osborne’s deficit reduction strategy is to work, growth be returned consistently and the economy rebalanced the BCC’s calls for radical action will need to be heeded. If Labour is to regain power it will need to regain the confidence of business and promote policies that will actually work at getting the economy growing. The problem is until the politicking ends and we see a decent effort on all sides to go for growth, to talk up the economy and revive our desire for growth it’s quite likely that the economy will continue to stagnate and the news correspondingly bleak.

Economy 2011: a bad news story

By Rachit Buch

Jesse J may have had success with her song Price Tag, but she was wrong: it is about the money, and too many people can’t help but think about the price tag. In fact, 2011 was summed in song form by Aloe Blacc’s I Need a Dollar, released a year ago.

This was the year of doom, gloom and anger. But it wasn’t all bad: inflation, unemployment and debt hit millions, but a fortunate group of hard workers in the UK did quite well as FTSE directors pay went up almost 50%. It turns out that this added to the anger, and exemplified the major theme of the economy this year: 2011 was when inequality hit home. At times, it felt like the newsreel had become stuck on ‘glum, to depressing’. Large, significant, multiple crises afflicted the UK, Europe, the USA and various developed and developing countries. Read more of this post