Labour Should Offer Hope, Not More Despair

01/10/2012 12:48 BST | Updated 30/11/2012 10:12 GMT

When the shadow chancellor Ed Balls spoke at the TUC annual congress earlier this month the loudest cheer came when he was challenged over Labour's disastrous backing of the government's public sector pay freeze.

Balls wasted an ideal opportunity then to offer hope, rather than simply more despair. And if his pre-conference media interviews are anything to go by - which actually seem somewhat at odds with what Harriet Harman said on last night's Question Time - Labour is going to have a hopeless week.

In its interview with on Friday the Guardian rather bizarrely justifies this renewed threat on public spending by saying: "Balls felt impelled to move in the face of evidence that borrowing is rising due to lower than expected growth and tax receipts, so putting more pressure on Labour to say how it would tackle the deficit after 2015."

This is economics through the looking glass. The glaringly obvious reason that borrowing is rising and growth has flatlined is that Tory-led austerity isn't working.

Apparently to be "credible" on the economy Labour must be "ruthless" on public spending. But at the same time Balls says the problem is a lack of demand. This is contradictory, but an obvious consequence of ignoring the needs of the public in a bid to appease "the markets" - meaning the very people at the top of the finance institutions that caused the crisis.

Alongside this muddle-headed thinking there are those that say, "fight the real enemy", "hold your nose, Labour are better than the Tories".

But that betrays a poverty of ambition and spirit matched only by its political ineptitude. There are signs that Labour's position on the economy is not being taken seriously. And in the next two-and-a-half years the party could find itself in danger of losing an advantage it has gained largely through the sheer unpopularity of the Lib Dems.

We need a genuine alternative now, to campaign around, and to inspire the millions looking for someone to stand up to this government of millionaire bullies. If Labour is to be ruthless, let it be at the expense of the bankers and the tax dodgers, not ordinary people.

In by no means an isolated incident I was told by one of our reps in Leeds last week that more of their colleagues, friends and family are planning to join the TUC's anti-cuts demonstration in London on 20 October than marched on 26 March last year.

I think this shows that there is a desire to channel the real anger people are feeling. More now understand that to boost the economy we need to invest to create jobs and put money in people's pockets - through increasing public sector pay, paying a living wage not a minimum wage, and cutting VAT. If Balls and Labour fail to understand this too it would mean our next government simply continuing failed policies.

We have argued that we need to follow up what will undoubtedly be a massive demonstration on 20 October - coinciding with marches in Glasgow and Belfast - with more strikes to take the fight to the government industrially as well as politically.

So we will be at Labour conference this year with the clear message that austerity isn't working and there is an alternative.

I will be joined at our fringe meeting on Tuesday lunchtime by Unite general secretary Len McCluskey and the economist Ann Pettifor where, among other measures, I will be arguing for a serious commitment to tackling tax dodging, for French-style super-taxes on the mega-rich, a reversal of corporation tax cuts, and for job creation to reduce unemployment and welfare costs.

This is a real alternative to the pain currently being inflicted on our country. And our challenge to Labour is to join with us and wholly reject the Tory medicine that is causing hardship for millions of people and making our economic situation worse.