Ask two Blairites when the New Labour project died, and you might get three different answers. The first is June 2007, when Tony Blair stood down as prime minister. The second is May 2008, when the party ran a class-based (and unsuccessful) campaign at the Crewe and Nantwich by-election. While the third is September 2010, when Ed Miliband was elected party leader.
Any of these would work, but I think my new favourite candidate is July 2009, in the midst of the Great Recession, when Gordon Brown stood up at Prime Minister's Questions and claimed that total government spending would rise by "zero per cent" in 2013-14. He never elaborated, his answer drowned out by jeers from the opposition benches.
The answer was damaging for a couple of reasons. In terms of mathematics, zero per cent is clearly not a rise. As for the politics, it made Brown look like he was in denial. But even worse, it opened up space for the obvious question: if there is no money to spend, what is the point of the Labour Party?
For more than a decade from 1997, the government was able to frame the great political divide in Britain as between Labour investment and Tory cuts. Every Conservative promise on tax was greeted with howls of derision, and ministers lining up to detail how many doctors or teachers that would cost. And the public was inclined to agree.
It took a Global Financial Crisis to discredit the investment versus cuts dichotomy. And once in office, the Conservatives used the narrative-setting power of government to switch the choice back to their preferred question of Tory spending restraint versus Labour tax rises. Which is why, even in 2024, with public services on their knees, Keir Starmer was at such pains to rule out tax hikes, at least on "working people".
Today marked the end of that era. Rachel Reeves stood at the despatch box and announced £40bn worth of tax rises, billions in additional borrowing for capital investment, and more money for public services, capped by a £22bn cash injection for the NHS. And she posed a question for the Tories: what would you cut instead?
Clearly, this is not 1997. The fiscal inheritance is genuinely difficult, while geopolitical conditions are similarly grim. That post-Cold War peace dividend cannot be spent twice. But what is so striking from today's Budget is how one can already make out the contours of the next general election. That is, Labour investment – in infrastructure and public services – versus Tory cuts. A dividing line that would only grow sharper under a Kemi Badenoch-led opposition.
Lots can, of course, go wrong. A second Donald Trump administration would likely lead to economic chaos, whether or not he instituted tariffs on everything that moved. A further deterioration of conditions in Ukraine, or the Middle East, or a Taiwan contingency would send energy prices skyrocketing, suffocating the economic growth on which Labour is reliant.
Even if those fates can be avoided, the public realm is in such a state that voters may not be thrilled by what their higher taxes are getting them come 2029. Still, it is exciting when a new dividing line begins to emerge. Even if it is the same as the old one.
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