Duncan’s Economic Blog

When Hopi met Jon…

Posted in Uncategorized by duncanseconomicblog on July 23, 2009

Go and read Hopi’s interview with Jon Cruddas.

Excellent piece of journalism and full of interesting thoughts.

“If you thought that you had dis-invented the laws of economics, you had these self correcting mechanisms which that meant that you could guarantee growth, then there was no reason to contest the central institutional arrangements for this positioning because it would guarantee trickle down …

…you could retain that coalition which retains power. Doesn’t necessarily change the country but it gives you an armlock around the political system at Westminster.”

This continued economic growth meant there were enough resources to keep an election winning coalition together, even if an ever increasing number of voters were dissatisfied or disillusioned. But this era of growth stopped suddenly last year.

“The music stops, middle of last year. Growth is no longer guaranteed.”

It follows from this, that the abrupt end to the politics of growth signals the end of the New Labour era. If Blairism was about taking the economic success of free market capitalism and spreading the proceeds more equitably, then what does the movement do when those funds are suddenly and sharply withdrawn?

“…The contrast is not just the Blair Brown period, but the way the Blair Brown period was forged in the context of a benign climate. …also contrast growth with austerity. A politics of scarcity contrasts with a politics of growth. That creates huge challenges to the party.”

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