What’s Ed Miliband’s vision for the economy? We’ll get the public version of that vision in a short while when Ed Balls gives his speech to the Labour conference, but last night one of Ed Miliband’s closest advisers gave us a more interesting glimpse of the underpinning of the Labour leader’s economic plan. Stewart Wood, a former aide to Gordon Brown and now a key member of Miliband’s team, gave a fringe interview to ResPublica’s Philip Blond. The two men nattered with glasses of wine in their hands (which were at one point topped up by a CCHQ suffer embedded behind enemy lines) about Wood’s values. One answer in particular, on how Labour should approach the economy from now on, was very interesting:
‘Tax and spend will continue to be a core part of what we do, but there are two limits. One is a constraint by the public finances and the economic reality where we just don’t have, you can’t put pressure on the tax and spend mechanisms we used, that some people are advocating.
‘There is another fundamental constraint in my view, which is… I worked for Gordon Brown for 10 years and went through that New Labour period. And if we’re honest, while we did lots of fantastic things, take inequality for example, we did more redistribution than any government in British history by quite a long way and inequality grew, so we didn’t get to the root of some of the problems and for me, the reason for that is that Labour, with the brief exception in the sixties, when Wilson was in power, has really what you might think of as being the demand side party, not the supply side.
‘It’s never really addressed the structure of the way the economy and the sort of try and not just wait for the British economy, British culture and society to throw up unequal outcomes that it then spends its time sort of fighting back against, but actually to have an economy in which more equality and productivity is baked in in a more fundamental way and that for me is what successful countries in Northern Europe that I admire most in different ways have done and so for me that idea of talking about, a supply-side project rather than just a tax and spend project that for me is not really in the Labour tradition but it is very much in a social democratic and socialist tradition.’
Ed Balls may be talking about a £400m child benefit cut here, and a ministerial pay cut there. But this is far deeper than that. No wonder the peer wanted a little more wine.