Virtually all attacks on Ed Miliband regarding energy prices begin with the statement ‘Ed Miliband is right but…” That the Conservatives might be wrong on their basic economics is politically very worrying. And yet Ed Miliband has not sought to frame the article like a convoluted Oxbridge economics tutorial. Long gone are the days of Gordon Brown using logical inferences to explain why financial recapitalisation was needed to avert an even bigger global financial crisis. Nobody seemed to care. What did George Osborne wish to do exactly about Northern Rock. He didn’t say, and it didn’t seem to matter. Labour, the allegation, spent too much, and yet staggeringly George Osborne wanted to spend as much more. When asked to identify what it was about Labour’s economic policy which was so fundamentally awry, Tory voters invariably are able to articulate the answer. When further pressed on how the Conservative Party opposed this fundamentally awry policy, there’s a clear blank.
Ed Miliband and his team can explain how the market has failed, perhaps going into minutiae about how competitors end up colluding, except nobody can prove this. They therefore rig the prices, it is alleged, so that they can return massive shareholder profit, while the prices endlessly go up. The Tories will counter this with the usual reply that the profits are not that bad, and it was Miliband’s fault for introducing his ‘green taxes’. Anyone who knows their economics at basic undergraduate level will know the problem with this. It’s all to do with the definition of ‘sustainability’. Sustainability does not simply mean ‘maintained’, although you’d be forgiven for thinking so, on the basis of the mouths of PPE graduates from Oxford. It’s all about how a company can function across a time span of very many years, acting responsibly in the context of its environment.
It’s instead been framed as ‘the cost of living crisis’. The problem with the national deficit, while a useful tool in giving people something to blame Labour for supposedly, is that when somebody goes out shopping in a local supermarket he does not tend to think of the national deficit. Likewise, much as I disagree with the ‘Tony Blair Dictum’ that ‘it doesn’t matter who provides your NHS services so long as they are free at the point of need’, voters will tend not to care about NHS privatisation unless they have a true ideological objection to it. NHS privatisation as such makes little impact on the ‘cost of living’.
Energy prices are an altogether different bag. It is perhaps arguable that the State should not interfere in private markets, but surely this acts both ways? Should the banking industry, and more specifically bankers, be ‘grateful’ that they received a £860 billion bailout from the State as a massive State benefit to keep their industry alive? Or did they not want this money at all? Even you brush aside the need of the State to interfere legitimately with prices, it is commonplace for the State through the law to interfere with unlawful activities to do with competition. The prices are the end-product of an economic process of faulty competition, poorly regulated.
And there’s the rub. Ed Miliband’s ‘attack on energy prices’ is not just a policy. It is actually a political philosophy. It is more tangible than responsible capitalism or predistribution, although one may argue that it bridges both. The attack on energy prices, on behalf of the consumer whether hard-working or not, is indeed a political philosophy. Margaret Thatcher may have gone to bed with a copy of ‘The Road to Serfdom’ by FA Hayek under her pillow, and all credit to her for fundamentally believing, most sincerely, that the markets could be ‘liberalising’. With this attack on energy prices, Miliband effectively in one foul swoop demolishes the argument that markets are liberalising. In Thatcherite Britain, consumers are suffocated by the business plans of big business. Miliband’s discourse is not a full frontal attack on any business; it specifically targets abusive behaviour of corporates. And the energy prices are symbolic of much of what has proven to be faulty many times before. Andrew Rawnsley concluded his article at the weekend, advancing the theme that the current Conservative-led government is a bad tribute band to Thatcherism, by saying simply that we know what happens next. It’s not just gas; it’s everything which has been privatised, including water, telecoms, and so it goes on. Authors in the right-wing broadsheets can go on until the cows come home evangelising how privatisation is a ‘popular’ concept, but the criticism of the abuse of privatisation is far more popular.
And Ed Miliband doesn’t want to issue ‘more of the same’ as before. John Rentoul is so exasperated he is now left to write articles on how being called ‘Blairite’ is not actually a term of abuse. But these are yesterday’s battles. The battle over energy prices is a massive explosion in the world that the market knows best. Its shock waves are to be felt in how Labour conducts itself in other policy domains, putting people primacy ahead of shareholder primacy. And there’s a plenty of evidence that this is the Most Corporatist Government yet – ranging from the reaction to Leveson to how to allow ‘market entry’ in the newly privatised NHS. The public were never offered an antidote to the Thatcherite poison from Tony Blair, and, even after 13 years of Blair and Brown, many Labour members had been left mystified as to what happens next.
The beginning of that answer definitely seems to be end of Thatcherism. The answer seems to involve a new post-Thatcherite ‘settlement’ about politics, society and economics. Whilst distinctly populist in feel, it fundamentally blasts Thatcherism to the core, and is highly deceptive. Whilst easily dismissed, it intellectually is a lethal weapon.