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After Labour’s landslide election defeat in 1983, some in the Party were discouraged by the response to the Bennite programme they had put forward.  A more robust perspective was offered by Cllr Ted Knight, the Leader of Lambeth Council:

“There can be no compromise with the electorate.”

Knight is making a comeback as the Chairman of Labour’s Gipsy Hill branch in Lambeth. Many felt that Jeremy Corbyn’s leadership of the Labour Party would mean a revival of Knight’s sentiments – with the consequence that the Labour Party would find its hostility to the electorate fully reciprocated.

The truth has been a bit more complicated. At the General Election last year Labour’s manifesto was certainly left wing. It is estimated that its spending pledges amounted to a trillion pounds (using the American definition of a thousand billion.) So perhaps Labour’s claim that the manifesto was “fully costed” could have been more vigorously rebutted by the number crunching chaps at CCHQ. Much of this spending spree would have been on renationalisation. Those proposals might be extreme: they would surely have a disastrous impact that would cause widespread dismay were they to ever take place. But proposals for renationalisation are popular. Those under the age of 25 will have never tasted a British Rail sandwich.

Tax increases are also sometimes claimed to be popular. At least for “the rich” – usually defined as somebody earning more than I am – or when it is specified by an opinion pollster that the money would “improve public services”. This week’s Budget saw pretty modest tax cuts – perhaps reflecting a mood of political defensiveness in Conservative circles prompted by such polling. Still the personal allowances for income tax are being raised. The threshold goes up to £12,500 for the “basic rate” – the level of earnings above which paying income tax starts. Also the threshold at which the top rate of income tax is applied is rising to £50,000. These changes will be introduced in April – a year earlier than planned. It is the second one that is the most controversial – as it only benefits the richest ten per cent. Yet John McDonnell, the Shadow Chancellor, has declared that Labour will not oppose the change:

“We’re not going to take money out of people’s pockets. Simple as that.”

His allies point out that Labour’s Manifesto last year only contemplated higher taxes for the richest five per cent.

So what are we to make of this?

One simple explanation is that Labour is chaotic. That while collective responsibility in the Cabinet might be strained, in the Shadow Cabinet it is not even attempted. Jeremy Corbyn does not provide clarity and so the rest of them make it up as they go along. Thus, for instance, we had the tweet below from Emily Thornberry opposing the tax cuts that McDonnell endorses. We have also had other Shadow Cabinet Ministers, including Jon Trickett and Angela Rayner, taking the same line as Thornberry. Even Corbyn took a swipe at “ideological tax cuts” in his Budget response. Theresa May took the chance at Prime Minister Question Time this afternoon to highlight this division.

McDonnell has come up with statements at odds with his colleagues on other matters – for instance saying that Labour would abolish Universal Credit and that any second referendum on the EU would not include the option of continued membership. These discrepancies in different interviews usually pass most people by. The difficulty for Labour is that voting in the Commons is something tangible. Shadow Ministers really need to vote the same way. It even tends to get noticed if the Labour backbenchers defy the Whip. What if the SNP or the Lib Dems propose an amendment opposing raising the threshold for the higher rate?

But shouldn’t the Conservatives also take note of the underlying challenge? McDonnell is a Marxist who has openly declared his ambition to destroy capitalism. Yet he is also clearly willing to “compromise with the electorate” in order to achieve power. Quite how compromising they would find a Corbyn Government should such a thing materialise is another matter – but by then it would be a bit late. Another reflection should be that if the Shadow Chancellor is afraid to oppose tax cuts then surely the Government should give a higher priority to finding room for some more of them.

24 comments for: Is the Marxist Shadow Chancellor really backing tax cuts for the rich?

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