Almost two months after achieving a historic parliamentary majority, the UK Labour government is showing a political ambition below expectations. Keir Starmer was right in diagnosing the deplorable economic, social and emotional state of the country after 14 years of Conservative rule, but his first steps are more like those of a prudent manager than a leader with a vision for change. The manoeuvring deployed in these initial weeks by Downing Street is textbook. The Finance Minister, Rachel Reeves, revealed shortly after taking office, with obvious overacting, a “fiscal hole” of more than 26 billion euros. This was largely due to unbudgeted public sector wage increases and the increase in the maintenance costs of asylum seekers.
The Conservatives bear a great deal of responsibility for their frivolous handling of the accounts in recent years, eager to cut taxes and stingy with the pay demands of stifled public employees. But the new government’s argument that none of this was in sight before the election is questionable. The deterioration was clear. So Starmer’s speech this week, in which he announced “painful” economic decisions in the next budget and warned that things would “get worse before they get better”, has been demoralising for Labour’s allies, from the unions to many of its voters.
Starmer’s programme was centred on the promise of growth. His first announcements, suggesting higher taxes and severe spending restraint, are reminiscent of the austerity strategy with which David Cameron’s government began its journey after the 2008 crisis. Labour wants to take tough decisions in the first few months in the hope that voters will blame their predecessors for them. But that policy of restriction, which caused so much inequality, was at least ideologically motivated. In the case of the Labour prime minister, it rather reveals a fear of criticism.
The UK needs investment in its crumbling infrastructure and in public services that are stretched to the limit: Starmer must use a perfectly legitimate economic policy instrument such as borrowing more courageously and intelligently. On other issues, such as housing or the four-day work week, he does seem willing to undertake far-reaching, innovative reforms.
His management of the post-Brexit era also presents unknowns. He has hit the mark with the tone he has deployed these days with European leaders to leave behind so many years of resentment and dispute. But the relationship between London and Brussels is two-way: any of the commercial improvements he seeks must be reciprocated with some concession, even more so after the bad taste left in the mouth by Cameron – and worse still by his successors – in the European capital. For example, greater labour and study mobility for young Britons and Europeans would be desirable, as several EU countries are demanding. Beyond bilateral agreements, Starmer does not even want to commit to that, fearing the wrath of Eurosceptics.
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