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It Is Labour's Old Guard, Not Corbynistas, Who Are Ignoring the Lessons of the General Election

02/09/2015 09:12 BST | Updated 01/09/2016 10:59 BST

'Labour lost because voters believed it was anti-austerity.'

That was the firm conclusion drawn by Labour's former policy co-ordinator Jon Cruddas from the findings of an independent review he established to determine the cause of the party's defeat in May's general election.

Now armed with what he believes to be the inescapable reality of the public verdict and its inevitable consequences for Labour, Cruddas is to be found warning the party that any future departure from the austerity agenda would carry a high price.

The findings - or at least Cruddas's presentation of them - have predictably been leapt upon by Labour's desperate old guard, which foretells of pestilence and great floods should the party do what everyone now expects it to do and elects Jeremy Corbyn as leader.

The latest to pray in aid the Cruddas review is Tony Blair, who wrote at the weekend: 'Labour lost because it was considered anti-business and too left; because people feared Ed in Downing Street with SNP support; and because he didn't have a credible deficit reduction plan.'

But some of the inferences drawn by the usually clear-eyed Cruddas, and keenly amplified by the Blairites, are seriously fallacious. For example, the key finding around which his argument is constructed - and which, he asserts, requires the party to accept 'some hard truths' - is that which shows 58% of voters agreeing that 'We must live within our means, so cutting the deficit is the top priority.' This, Cruddas reasons, demonstrates that 'the Tories didn't win despite austerity; they won because of it'. He apparently concludes that it can only mean the public supports rapid and deep cuts to public spending as the means to eliminating the deficit.

But all of this assumes that there is no quicker or more efficient way to reduce the deficit - when, of course, a credible and coherent alternative does exist. That alternative is one which recognises austerity as the worst possible response to an economic crisis, and that increases in economic activity and levels of growth (and concomitant reductions in the deficit) are best achieved not through slashing and burning, but by maximising tax revenues through the revitalisation of the real economy, by investment, managing demand and making full employment the prime goal of economic policy, by averting any fall in real wages, and by protecting public services and defending the jobs of those who work in them.

While this alternative, which is nothing more radical than mainstream Keynesianism, increasingly attracts support throughout Europe and among institutions - the IMF and European Central Bank among them - hitherto hostile towards it (their change of heart was inevitable, given the failure of austerity politics everywhere), mainstream politicians in Britain, and most depressingly on the left, remain either oblivious to the evidence in its favour or too timid to articulate it. Labour's old guard would doubtless see it as a disastrous abandonment of the centre ground. They forget that once upon a time these arguments constituted that centre ground; it's just that the centre shot off to the right a long time ago.

It should be noted, too, that Cruddas considered only the views of voters in England and Wales on the austerity question. How can this do other than distort the findings? Labour was wiped out in Scotland, where anti-austerity sentiment runs deep. Cruddas assures us that findings from a separate poll of voters in Scotland will be released in due course. So be it. But perhaps he should have waited for the results of that poll before rushing to judgement and offering policy prescriptions based on incomplete data.

But even if Cruddas's interpretation were correct and voters have bought the austerity lie, it would hardly be a surprise. For years, and right throughout the 2015 election, they were assailed by politicians on all sides, backed by the media establishment, espousing the primacy of deficit reduction, telling them that everything else must be subordinated to that goal, and offering nothing in the way of an alternative strategy. Against that background, it's pretty amazing that as many as 42% of them challenged that consensus. Presented with counter-arguments, intelligible and confidently articulated, it's not difficult to see how that 42% might be transformed into a majority.

Cruddas displays further dubious reasoning when claiming that 'The idea of an anti-austerity alliance with the SNP is unacceptable to a majority of English and Welsh voters'. In support of this contention, he adduces the finding that 60% of those polled 'would be very concerned if the SNP were ever in government'. But hold on. Voters' feelings towards the politics of austerity and the politics of nationalism are surely two fundamentally different questions. Is it not perfectly possible for English and Welsh voters to simultaneously reject austerity while harbouring misgivings over a power grab by a party that wants to dissolve a 300-year union? Cruddas is plainly wrong to draw a straight line between the sentiments of pro-austerity and anti-Scottish-nationalism as if it were the most natural thing.

Cruddas's review does not testify to the popularity of austerity, less still provide an excuse for the failure by the Labour party leadership to advocate a clear and bold alternative. Those conservative elements within the party who seek to exploit the findings remain in denial of the reasons for defeat in May. It wasn't being 'too left-wing' that did for Labour; it was the belief that, so far as it was desirable to fight on the economy at all, the objective had to be one of aping the Tories on 'fiscal responsibility', for which read deficit reduction for its own sake.

Cleaving to that strategy will doom the party to perpetual opposition, failing as it does to understand that most voters are not instinctively pro-austerity, but that in the absence of a convincing alternative they will always opt for the authentic model rather than the slightly paler imitation.