Sunny Dave’s optimism on the cost of living may just be spin, but how Miliband responds is vital. Gloominess is not an option
David Cameron will feel a real sense of belonging as he presses the flesh at Davos. Who would have thought it? Had the global power summit been held just a few months ago, he would have undertaken that pilgrimage as acknowledged steward of an ailing, troubled economy. The story he might tell now permits a certain swagger.
There is now a “recovery for all,” he declares, as analysts say the earnings of the majority are now increasing by more than inflation. Ministers point to new figures suggesting that all except the richest 10% had their take-home wages increase by at least 2.5% once tax cuts were taken into account.
Add to that the news about unemployment; now down to 7.1%, and rising house prices, and the news that the Bank of England will not soon raise interest rates, and one sees how the prime minister is able to frame a narrative about how the strictures of austerity are beginning to reap the benefits.
Those here who have witnessed the chaos in Whitehall and Westminster these past four years may look askance at the notion that the pieces of the jigsaw are being methodically assembled, but in Davos this will undoubtedly play well.
And what can one conclude from the strategising of recent days? That once again, it’s about the economy, stupid! The debates on immigration and welfare may provide unpleasantly discordant mood music, but the real battleground will be about the state of the recovery and who can be relied upon to deliver it.
And therein lies a problem and a decision for Labour. Is it going to spend the next months talking the economy down while the Tories beam optimism? That’s a trap best avoided. For all our cynicism, there is still superior force in the politics of hope. Optimism is a much more powerful electoral stimulant than pessimism. Labour cannot allow this to become a contest between Sunny Dave and Jeremiah Ed.
Of course Labour must flag up any deceit over the government’s figures if they seem questionable. Already that is happening. The shadow Treasury minister Cathy Jamieson insists the cheery figures on pay have been massaged and draw attention away from matters such as cuts to tax credits and child benefit, both of which have hit working families. She says that in fact real annual wages have fallen by £1,600 since 2010 and cites figures from the Institute for Fiscal Studies indicating that “families are on average £891 worse off as a result of tax and benefit changes since 2010”.
That is all well and good. But over and above any focus on the coalition’s failings, Labour must have a coherent plan about how it will do better. The lack of that narrative is probably why Labour has so far failed to pull away in the polls and is now seeing its poll lead tighten. The latest ICM poll for the Guardian estimated the lead at just 3%.
That said, the determinant will not, in fact be what politicians say, or even what the media say about the state of the economy. People’s anger with politicians and the media is such that neither of us are fully believed anyway. The crucial factor will be whether or not people actually feel change for the better in their own lives, and the lives of their families and neighbours. Only then will they pay attention to politicians and the media, and whether what they hear chimes with their real-life experience.
It will be about the economy, but the real economy, and not the picture as drawn in the Westminster village or the high-powered salons of Davos. Seen in those terms, there is all to play for.
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