Why Labour Shouldn't Get Hung Up On the Cost of Its Policies

Like "Kid A" and "To Pimp a Butterfly" before it, the Labour Party's manifesto has been leaked ahead of the official release date. But, just like those era-defining albums, the leak might have ended up serving its authors well: everybody is talking about it, and they'll get a chance to talk about it again when it's properly launched next week.

Much of the media has doggedly gone into its best "good things are bad" mode, with one prominent commentator mourning the proposed outlawing of unpaid internships, and the headlines of The Telegraph, The Sun and The Daily Mail warning of a return to the 1970s. (New Hollywood, post-punk, rising wages – seems alright?)

It's important to not overstate the importance of party manifestos. More than anything, they are a way of articulating the tone of a prospective government. In this sense, a Labour government formed next month will be solidly social-democratic, oriented toward un-doing some of the major gains made by neoliberalism over the past 40 years. Energy infrastructure will be placed under public control, with a state-run option introduced to markets (not the spectre of monolithic state industries haunting the press' coverage); train operators will be re-nationalised; workers' rights will be enshrined in a "20 point plan for security and equality at work"; tuition fees will be abolished; the "privatisation of our NHS" under years of New Labour and Conservative governments will be "reversed". Unsurprisingly, Brexit is subordinated to other concerns – it is first mentioned on page six, while it's likely to be plastered all over the first page of the Tory's manifesto. If there's one thing that hinders Labour's stance it's the "fiscal credibility rule" – prioritised to page two – as well as the general issue of "costing" and "credibility". So far in this campaign, every policy idea from Labour has come, almost literally in the same breath, with an explanation of how they will pay for it. It has the quality of a neurotic tic – here's a great idea that will really improve people's lives – and tethered to it is the dead-eyed, sober calculus. Inevitably, the media centres the conversation on the viability of the latter – "How will you pay for it!" – and ignores the social value of the former. This shows that Labour is still beholden to the logic of austerity economics: the idea that there is no money, so if you want anything nice you'll have to hurt hard-working people – those struggling folk on £80,000 a year – with taxes. Just as it will never be as "good" at being racist as UKIP, Labour will never be as "responsible" on the economy as the Tories. When the manifesto reads, "We know the importance of managing public finances, so our manifesto is fully costed, with all current spending paid for out of taxation or redirected revenue streams", it concedes to the myth that public spending, rather than the financial sector, was responsible for the 2008 crisis and the lost decade that's followed it. It is un-winnable terrain.

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This is annoying for two reasons. The first is technical: taxing the rich is just and necessary, but spending doesn't have to come from taxation, and there isn't a limited pool of money. As the New Economics Foundation has pointed out, the government has been "printing money" (to use what they admit is a misleading metaphor) since the recession by providing billions of pounds to banks in the form of quantitative easing. They recommend instead a "strategic quantitative easing", where the Bank of England actually acts like a bank – directly funding things like infrastructure projects and boosting the "real economy". A Labour government could also commit to the public spending sketched in its manifesto draft by borrowing – the skies won't fall in if it does. As the economist Chris Dillow recently laid out in a blog post, borrowing is the right thing to do now, and the whole "cost-cutting" logic is bullshit, resting upon the idea that "governments must act like prudent housekeepers, accounting for every penny":

The second reason is political: there is always money for certain types of government spending. During the current discussion on whether Britain will send more troops to Afghanistan, you won't hear any questions about how the government will pay for it. Certain things – like an interminable imperial conflict – are too important to be sullied by questions of cost. One of the remarkable tactics thrown up by the recent French presidential election was the way the left-wing candidate Jean-Luc Mélenchon, who also proposed a large spending programme, dealt with questions of cost. Although he had a document that detailed the spending, unconvincingly to some, whenever he was asked on television about "les chiffres" (the numbers), he would respond by undermining the assumptions of the question: "And misery, how much does that cost? And the destruction of the planet? I'm asked endlessly how I will pay for this or that. When are we going to ask how much those who die from pollution costs?" Obviously a presidential candidate with his own party has freedom to speak in a way Corbyn, shackled by the intramural wars of the Labour Party, doesn't – but Mélenchon's example is instructive. Labour's manifesto promises a humane, decent future, but I can't help wish it resisted the straitjacket of "costing", offering up a fearless vision on its own terms. The facts and economic arguments are there if Corbyn needs them, but they shouldn't be painfully stitched onto the world – one "with dignity for those who cannot work" – that the left is supposed to imagine.

@yohannk