THE Tories appear to be in something of a panic. Talk of a landslide has been abandoned. Their election strategists are at each other’s throats over the humiliating U-turn on “social care” while their cynical attempt to exploit the Manchester bombing has done little except expose the bankruptcy of negative campaigning.
Now, in a final show of desperation, they are planning to give Boris Johnson — Britain’s answer to Donald Trump — a top billing in the final stages of the campaign.
Last week the Institute for Fiscal Studies (IFS) condemned both Labour and the Conservatives for failing to meet the costs of their manifesto promises.
The IFS’s case against Labour is twofold. They doubt whether Labour’s plans to tax the super-rich and the big corporations will work; the rich are too clever at avoiding tax.
They also claim that the party’s labour markets reforms will reduce productivity not increase it — hence limiting economic growth.
Both claims are highly questionable. Over the past two decades the super-rich have indeed been very successful at evading tax. No wonder. The “intensely relaxed about the filthy rich” Peter Mandelson was twice business secretary under Tony Blair.
Since then, the Tories have massacred the Civil Service departments responsible for tax collection. Labour now promises to set that right.
The institute’s criticism of Labour on productivity is focused on the party’s minimum wage plans. Tory proposals will mean no increase at all.
The 12 per cent of under 25s currently getting the minimum wage will remain the same. Zero-hours contracts will continue. By contrast, Labour’s proposals will drastically increase the proportion to 60 per cent.
How can this reduce productivity? Matched with Labour’s proposals for massive infrastructure investment, it will result in a more stable, better trained and better equipped workforce.
Currently Britain’s “cheap labour” economy is one of the main reasons why productivity has hardly increased over the past decade.
However, more revealing are the parts of the IFS document that have not been reported.
The IFS is clear that Tory plans will mean that cuts and austerity will continue. There will be no let-up in the assault on those dependent on benefits, no justice for women caught in the current increase in pension ages and the attack on the “triple lock” will mean every pensioner will see their incomes reduced.
These Tory spending plans will mean the proportion of national income spent on public services of all kinds will continue to fall and take Britain down to the bottom quarter of advanced economies.
If the Tories get their way Britain will be spending a third less than France and a quarter less than Germany — lower even than South Korea, Lithuania and crisis-hit Cyprus.
Labour’s plans will do the reverse. They will take Britain up the list — but only to half way and still behind most other European economies.
However, even this misses the most important point. It is whether the size of the economic cake will have grown by 2022. This is what will determine the size of the slices.
The Tories have no plans for lifting economic growth apart from the neoliberal incentives that have failed so spectacularly over the past decade.
Labour’s plans engage with the real economy: public ownership, infrastructure investment and an investment bank for small business and co-operatives.
Voters are beginning to see this and this is why the Tory high command is in a panic. They have nothing to offer — and negative campaigning has its limits.
Source: Morning Star / RedGlobe