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Miliband's New Labour Mark II

There are some in and around the Labour Party who believe – or perhaps imagine – that the election of Ed Miliband opens up the prospect of a qualitative break from the Blair-Brown years. After reading his first major interview as party leader, you have to say they couldn’t be further from the truth.

New Labour Mark I may be over but watch out for New Labour Mark II, is Miliband’s essential message. In his interview with The Guardian today, Miliband talks about going “beyond New Labour” without ever repudiating the way his predecessors transformed the party into a cheerleader for market and corporate-driven globalisation.

In fact, Miliband praises much of what New Labour did, saying: “Don't knock it, because it achieved a lot, like the rebuilding of the public realm, tackling poverty.” He omitted to mention the downsides like increased inequality and encouraging an economy dominated by finance capitalism, which contributed to the 2008 meltdown.

Although Miliband claims he is starting with a “blank sheet” in terms of policy, it is clear what direction he wants the party to travel in. Sounding not unlike David Camerons’ New Tories, Miliband says the main task is to examine "how you can create greater social justice in the economy without having to rely only on redistribution and the welfare state.”

What does this actually mean, you may ask? This is Miliband saying that the idea of using the state to redistribute wealth is over. No doubt one reason is that the state no longer has the money to pay for things like tax credits, which were a feature of Brown’s policies. And his criticism of the welfare state uncannily echoes Cameron’s attack on “welfare dependency”, which is behind the Coalition’s plans to dismantle what is a safety net for millions of people in terms of housing and benefits.

Miliband explains: "However, I think it's very clear that as we are reformers of the market – we should also need to be reformers of the state. I don't consider myself a sort of statist. The top-down idea of the state is as much of a problem as an idealised view of the market and in a way they have their similarities. Both treat people not as people but as kind of objects."

So how is the aim of “social justice” to be achieved? If it’s not through the state, then it can only be via capitalist markets and corporations. There Is No Alternative – within our present political and economic framework, that is. What Miliband is burying is a central principle of what was Old Labour in order to come to terms with the financial crisis that broke in 2008 and that shows every sign of exploding once more.

And that means cutting the budget deficit. Miliband may disagree with the Tories’ rate of attrition, but admits that Labour would be making deep cuts in spending if they’d won the election. In fact, Labour is already preparing to make massive cuts at local council level, from Manchester to Lambeth, and at town halls across Scotland and Wales.

Labour councillors say they have no choice because the instructions to cut are coming from Whitehall and, by law, they have to make a balanced budget. In other words, they are just carrying out orders. That’s never been an acceptable excuse at any time in history. But for Labourite councillors and leaders, it’s all water off a duck’s back.

Paul Feldman
Communications editor
22 November 2010

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