When a party is as down and out as Labour is today it is conventional for them to debate whether they should now concentrate on salvaging something by pandering to the core vote, or drive decisively to middle Britain and ignore the many party cries for a more traditional approach. It is only fitting that Labour should now agonise over this, as they have spun for years that the Tories can only do well if they ignore their core and position in the centre ground.
I do not believe in the conventional descriptions of UK politics based on a left-right analysis. Some of the defining issues no longer fit in such a geometric pattern. Euroscepticism is not a monopoly of the right, and is held passionately as well by the Benn wing of the Labour movement. Pulling out of the EU was after all Labour policy in the 1980s. Wishing to restore our civil liberties is a passion of many of us Conservatives today, but there are other Conservatives who hold more authoritarian views, whilst many in Labour hate their governmentâ€™s attack on our liberties. The left tries to make out that only they would pay large sums into our schools and hospitals, yet both main parties believe in free treatment and free school places and accept that requires substantial and increasing sums of public spending on them. The new divisions are Eurosceptic versus Euroenthusiast, and freedom loving versus turning to the state to seek a greater sense of security and direction in private lives.
Mr Brown will be unable to learn any lesson from recent electoral reversals that requires getting powers back from Brussels, or requires allowing us greater freedom. He is too hooked onto the Euroenthusiast agenda of more power to the centre, and too persuaded that he needs to take more control over our lives to fight his own miserable version of the â€œwarâ€ on terror. He will need to look elsewhere for policies that might chime with an increasingly sceptical electorate.
In the economic sphere there is a clearer distinction between Conservative and Labour, and between Blairism and old Labour. It is here the battle will be fought for the sole of Brownâ€™s Labour. Is he truly a Blairite moderniser, as he sometimes spins, or is he an unreconstructed tax and spend socialist, as his actions since 2001 indicate? Will becoming even more of a tax and spend socialist help win back the core vote, or does he need to become less of a tax and spend socialist to win back some â€œcentreâ€ votes?
Blairites believe that public services should be opened up to more competition and choice. They believe that whilst delivering free medical care and free school places remains important, this can be done more effectively through a range of providers, some of them in the private or charitable sectors. They see the inefficiencies, poor quality and high cost of some monopoly state provision. Socialists believe that these services must be supplied in a uniform way by state employees through a monopoly service, and persuade themselves that any problems of quantity or quality simply reflect a lack of â€œfundingâ€.
Gordon Brown has elements of both in his thinking. In his statements he tells us the Blairite reforms carry on. He claims to favour a wider range of different types of school, and wants private treatment centres hired by the NHS to provide specialist facilities. However, as Chancellor he was often the roadblock to reform, and as Prime Minister for all the fine words there is not a lot of evidence of major reform on the ground. He increased spending massively to test out the old Labour proposition that there was nothing wrong with monopoly state services that large injections of cash could not put right. Now in power at Number 10 he faces the conundrum of what do you do when the public services are still not good enough and you have run out of money?
The irony of the PMâ€™s position is clear. He will continue to speak as a moderniser but will operate as a traditional high spend socialist. The one thing he is likely to conclude from the bruising rows of the last few months is he should drop all moves to higher taxes, and just borrow and borrow and borrow. The left has largely given up on the idea that taxes on people should be raised â€“ after all the left somewhat belatedly joined Conservatives in complaining about the last income tax hike. Trade Unionists will have another go at taxing energy companies, just as oil prices start to subside. The demand will be popular, but the Chancellor if he goes there will probably end up making another mess and become impaled on an increasingly international and vociferous business lobby capable of shifting profits and domiciles quite quickly if he goes too far.
All this leaves Gordon Brown to do as he will see it is to spend more and more on Labour areas and Labour causes. This will make the economic position worse. Years of high spending on the inner cities, and years of skewing spending to the north and west away from the more prosperous south and east has failed to narrow the gap. Over the last eleven years the more they have spent in the public sector the bigger the regional gap has grown. This will not deter them.
Heaping more public spending on will delay the interest rate cuts the UK economy needs to revive its housing sector. Spending more in the public sector will intensify the squeeze on the private sector and lead to more job losses there. It will reveal to all who still do not get it that Gordon Brown is very much a high spend socialist. It will also bring his government down. Itâ€™s the economy stupid. More public spending is not the way to fix it.
If he wants to revive his political fortunes he does need to get a grip on the public sector, and reduce the squeeze on the private by cutting taxes and interest rates.