By Ollie Stone-Lee
BBC News Online political staff at Labour's conference
Labour has problems with public trust but should not slip into one of its "periodic panic attacks", Foreign Secretary Jack Straw has said.
Straw says higher top rate taxes will scare off middle class voters
Mr Straw told a fringe meeting at Labour's conference it was critical to talk more directly to voters.
The meeting also heard ex-minister John Denham claim Labour talked less about wealth than the Victorians.
He said Labour should stress being rich comes with social obligations to pave the way for higher top tax rates.
The comments came during the Guardian newspaper's debate "can Labour lose?"
Mr Straw said the party could not be complacent especially in a society where people changed their political loyalties often, and possibly en masse.
"The ideal of the gradual swing of the political pendulum may have had its day," he said.
But the Tories under Michael Howard showed no signs of making a breakthrough, or even knowing which direction to take, Mr Straw continued.
"So this is not time for one of Labour's periodic panic attacks.
"But the problem for us is that it does not feel as good as it should be.
"I think at the root of this is an issue about trust."
Mr Straw said the trust problems stemmed from the way politics was reported and spin, which happened in government less than people thought.
"There is no question about it that Iraq - and the things around - it have damaged trust in government," he said, defending the decision to go to war.
But ministers should not flinch from tackling the problem of world threats, he added.
Denham is free of the constraints of office
And, echoing former Conservative leader John Major, he called for a return to "soap box" politics, claiming he used such a platform on the campaign trail in his Blackburn constituency.
"That kind of direct communication seems to me to be critical," Mr Straw said.
Calls at the meeting for Tony Blair to step down in favour of Gordon Brown because of Iraq were met with jeers.
The foreign secretary said people would not be enthused to vote for Labour if the party's members were pushing for a new leadership.
Asked about why Labour did not raise taxes for top earners to cut the poverty gap, Mr Straw said that move would "scare off a lot of middle class votes" while raising little money.
People were not worried about whether "some geezer" earned £2m rather than £1m but about whether their own standard of living was better, he said.
Mr Denham agreed in the short term about the worries about raising top taxes.
But he said: "We have less to say about wealth as a Labour Party than the Victorians had to say about wealth."
It was a shame terms like "fat cats" had disappeared, he said.
"If we could campaign consistently with the sense of obligation and responsibility that goes with being wealthy, we might get into a state were the electoral dangers of having a their rate of tax would not be as sharp," he said.
Mr Denham argued the party had not governed as New Labour in some areas.
There needed to be a vision of society which united people, not one policy for the Mirror, another for the Guardian and lots of policies for the Daily Mail readers, he argued.
"That was not the vision, the vision was a British society that was cohesive."
Mr Denham also said Labour needed to recapture the knack of showing its politicians lived in the same streets as voters and shared their concerns and ambitions.
For example, John Prescott was now announcing plans to help first time buyers but the problem had been "absent from Labour's picture" for the past five years.
"It was almost as though when we moved from opposition to power, the problems that seemed too difficult had to be written out of the script," he continued.
Mr Denham, who resigned over the Iraq war, criticised the effort that went into persuading the British people the government was right and they were wrong on the war, when, in fact, the reverse was true.