Page last updated at 11:38 GMT, Wednesday, 26 November 2008

The death of New Labour?

By John Pienaar
Political correspondent, BBC News

Mervyn King
Not Marx: Mervyn King has been warning banks to increase their lending

Close your eyes and superimpose a huge, scraggly beard on the face of Mervyn King. Ruffle his hair a bit.

The governor of the Bank of England still doesn't look much like Karl Marx, does he?

Now remove the exquisitely tailored suit, and imagine him in a donkey jacket. Michael Foot he isn't. Or, for that matter, anyone but the cautious, conservative, pillar of the British financial establishment that he is.

Yet there he was, calmly contemplating the nationalisation of British high street banks. Not just public ownership or partial ownership of banks, but control.

No-one has seriously dreamt of such a thing since Labour's 1983 manifesto. Remember? They called it the "longest suicide note in political history".

At any normal time, it would have been a mind-boggling suggestion. But these times are far from being normal.

As it was, it was merely surprising.

Having listened to the latest session of the cross-party Treasury Select Committee, it is a little hard, surely, to accept that the pre-Budget report amounts to the "death of New Labour".

Is this really the return of old-style, redistributionist thinking to the party of Gordon Brown and Peter Mandelson (now, apparently, as close as ever they were in the salad days of the New Labour project)?

Cabinet ministers seem to laugh off the idea that Labour has returned to its rather withered, socialist roots.

The present economic emergency has turned all conventional political thinking on its head.

Unconstrained borrowing is prudent. A spending spree is responsible, even selfless.

And public ownership of a High Street bank may be no more than reminding the board to do its duty in our free market, capitalist system.

These are, as the chancellor said on Monday, "extraordinary times".

In any case, as one cabinet minister put it to me: "We've always been redistributionist. Look at tax credits."

A Downing Street adviser added: " New Labour has always been about adapting to changing circumstances. That's what we are doing now."

True. The "R" word was always banned and come to think of it, still is.

Euphemisms such as "social justice" are preferred. That and the need to pour cash into the pockets of those thought most likely to spend it.

Labour has, nonetheless, returned to a place traditionalist Labour MPs find wonderfully comfortable.

Clinton and Obama

The proposal for a new top rate of tax on those earning over 150,000 a year is thought likely, by those MPs, to appeal to the British sense of fair play.

In the meantime, they love the idea to bits. Cabinet ministers seem to laugh off the idea that Labour has returned to its rather withered, socialist roots.

Perhaps they are simply laughing with joy at the sudden influx of cash into their departmental coffers.

As for the Tories, they seem ideologically comfortable with their return to the principles of fiscal Conservatism.

But they are privately admitting to the discomfort of watching Gordon Brown's hyperactivity from the enforced idleness of opposition, while waiting for an instinctive dislike of deep debt, and a yearning for tax cuts in the distant future, to buoy up their position in the opinion polls.

As one senior member of the shadow cabinet put it: "Remember. Bill Clinton won an election on the issue of the national debt."

Maybe so. But Barack Obama won one on the issue of taxing the rich, and borrowing billions to spend refloating the economy.

This argument has a long, hard distance to run. It won't be easy for any of them. On both sides, they understand that perfectly well.

Here is a selection of your comments reflecting a balance of the views received:

New Labour and Old Labour are dead as far as I am concerned. I can't believe there are people who defend these incompetent oafs. Most of middle England have been saying for years we are heading for a fall, so what do Labour do?...climb higher to ensure the fall is further. Let us all move to vote no confidence in them!
Gary, Lincolnshire

New labour is finished it got in with a confidence trick pretending to favour the downtrodden then turned into a Wolf in sheeps clothing It told porkies about student fees,its whipped up hysteria against the sick and unemplyed ,its pandered to lobbyists payed billions to agencies , Junketed the private sector Spin Lies,daft ideas, draconian almost Stasi like intrusion, 1984 Orwellian attitude,It ddint build public housing it wrecked teh economy betrayed the working class,made our borders porous, allowed the feral to run riot,yes NewLabour is dead bury it as a failed experiment It wasted a golden oppurtunity to heal but instead caused pain, RiP & good riddance
shaun, stoke on trent

Is New Labour Dead? Yes, Thank goodness clear off now! take your PC, redtape anti English claptrap with you and dont come back....EVER!
bill, Ascot

New Labour was able to win elections and govern the country by abandoning looney left ideas and moving to the centre ground. I think everyone agrees that extreme times call for extreme actions but the governments legacy will now be remembered not for the good "new labour" has accomplished but the tax time bomb "labour" has left for the next generation. New Labour RIP
Steve Scandrett, Warwick

Don't worry too much; if you look at history Labour overspend and run up huge debt; the Tories are elected and sort it out. Then when it is looking good we vote for some used car salesman, and Labour get in again.
Alex London, London

Yes, New Labour is dead and has been for some time now.

I would love to see the evidence that Gordon Brown based his 'no more boom and bust' statement on because everyone trusted that he was telling the truth only to find it was a lie. Now good old Gordy is claiming that he didn't actually say that. He is now having to mop up his own mess from when he was Chancellor.

He can point the finger of blame at someone else for the mess we're in now but he's got 3 other fingers pointing right back at him.
Angela C, Huddersfield, UK

Blair's calling for a new model of capitalism after spending over a decade at No. 10 telling us the one we had was the best thing since sliced bread. The Tories want to get through the recession by putting millions on the dole, just like they did in the 80'a and 90's, when they created the current model that has failed so miserably around the globe. As for Gordon, he'll now do anything to retain power. If he fails then we can look forward to the Thatcherites regaining power, and finally finishing her work - the total decimation of the British economy and British society as we know it.
Andrew Thompson, London

Yes NuLaburr is dead and buried - and good riddance.

Add to this the fact that "Old Labour" has been long dead and you get the dream scenario - no more Labour party. Not ever...

All we need is a snap election to put a bunch of useless MPs on the dole - or, more accurately, back to their city jobs "full-time".
adey, Plymouth

I hope that what is happening may be a signal that the Labour Party is returning to where it tradionally came from. The sad thing of the past ten years is that the rich have become filthy rich while the poor have been getting the scraps from the rich man's table. I hope this is a return to good socialist values
john whyte, Buckley, North Wales

Anyone watching Ed Miliband's face when the chancellor was at the dispatch would give a resounding "yes" to this question. The shock and horror on his face really spoke volums, he seemed as appalled at the ammount of borrowing as anyone on the tory or libdem benches.
Annie, Durham

Nulabour/old labour it's all the same to me. Labour have never been a party to get the country going anywhere. They just make a huge mess and the Tories have to clean it up. Its such a shame when the workers think they can run the business, when in fact the managers are the only ones with the insight to make it work. Roll on the general election.
Bob, UK

I have never thought that old Labour had died. Gordon Brown has been taxing us wealth creaters and giving the money to those who want to lay in bed until the pubs open since he came to Government. On another point, where have all the Gold reserves gone, into those same pockets I think you will find.
Robert Bebbington, Havant, England

This farce that is so called New Labour ,was always destined to hit the buffers ,when a political party has no basic beliefs & values and drifts based on the last mori poll or sound bite ,its no wonder we end up with the goverment falling between a political rock & a hard place . Had the goverment maintained a core values beliefs approach to its politics over the long term ,the country as a whole would know where its goverment are taking them ,based on knowing what there political stance was ,sadly we have fag paper politics between labour & tory ,close your eyes and you could be forgiven for not knowing which party was speaking . Then we wonder why we have such apathy within the country for our political system .
Peter Burrows, Dunstable

Personally I thing New Labour's first act of self-harm was to impose an unelected prime minister on the country. Now, the pre-budget fiasco has opened up the party's veins and the coup de grace will be administered at the next election.
Terry Ozbourne, Newark, United Kingdom

I find it hard to consider this the rebirth of Old Labour when a body far more market-driven than New Labour is adopting similar interventionist policies to those recently announced in Britain: the US Treasury. I take Alistair Darling at his word that these are necessary measures in these extraordinary times, not some opportunistic grasp at long-harboured socialist goals.
John, Lewisburg, PA, USA

New Labour was in life support the moment Gordon Brown became Prime Minister. The PBR (Pre Budget Report) definitely buried the patient.

By the way, forget 45% on those earning 150K, the PBR has introduced a new marginal rate of 61.5% on those earning 100K due to removal of tax allowances.

Definitely old Labour and the highest marginal tax rate since the 1970's.

Patrick Hall, UK

New Labour is not dead and neither is a progressive agenda. The strength of a modern party is how you adapt to changing situations. New Labour in taking action on the banks and re- balancing the tax rate to reflect social justice. This is not return of 70's style Labour Policy's in fact just the reverse. New Labour is being realistic on the problems we all face with a world downturn. What we are seeing is not the death of New Labour but the death of Conservative free market policy that leaves everything to the markets to decide and ignores the risks we have all seen. Thankfully that free-market view is over. A view which has caused so much harm with the world economy in past months has Finally shown that Thatcher and Regan's grasps on understanding was ill judged. Far from New Labour being dead it is policy that David Cameron and his Conservatives are still following that is being firmly rejected.
Gary Hills, Stevenage/England

It's alive and's about making decisions not on tribal ideology for the tribe's sake but making decisions based on the need of the country at a particular time. We may not have had the end of boom and bust but we do have with New Labour a party who governs in the interest of the country regardless of whether the decisions being made are unpopular with tribal elders within the party.If it is the best thing for the country they will do it. There is no reason why New labour should not be in power for the next ten years and I hope they are.
kdbur, london

Not only the death of New labour but the slippery slope gets re greazed and becomes increasingly steeper for the Labour party. This sham will only feed the increasing argument in favour of a return to Conservative power in England and Scottish Independence. A vat decrease and a few mediocre concesions in a feable attempt to buy confidence has already not surprisingly, back fired as Labours tactics are scrutinised and exposed. Even in a depressed world and with its Banking Infrsastructure ruined by irresponsible actions of New Labour and pending mass unemployment, Scotland would be better off now and after the recession recedes as an independent nation. The Health of a Nation is directly affected by its Wealth and Great Britain as it is known, is dying.
Kenny Higgins, Inverkip Scotland

The End of New Labour? Goodbye to Tony? What a wonderful thought. We so much need hope after years of Thatcherism and the man who fell in love with His own image and his notorious place in history. Roll on a new era. We probably owe Barack much more than we realise.
Julian Buchanan, West Kirby

Yes, but not in the sense of it being a return to Old Labour. It seems to me that even if they manage to start to salvage the British economy in time; they'll still have lost the argument. To most people it looks just like they're penalising tax-payers for banking policies and rewarding the bankers. That's different to New Labour, but the opposite of Old Labour.

The problem is that my research shows that it was the Conservative policies of the 1920s and 1930s; particularly the commitment to the Gold standard which helped make the UK depression so deep and destructive and it was the left-wing Keynsian economics which, implemented in Japan and then the US actually dragged them out.

I don't believe the Tory response is right, but it is easy to understand. I don't think that Labour can win the argument unless they can convince people that money is like fluid which needs to flow to be useful, not an object which is valuable because you own it.

-cheers from jules @P
Julian Skidmore, Manchester, UK

"New Labour" and the hideous Blair Smile was only ever a thin veneer to deceive the English people and make Labour acceptable. "True Labour" was always just under the surface. Labour was rejected by the English people in the last general election and was only returned to power through the distorted electoral system that favours Labour over other parties.

Labour's financial incompetence and its love of soviet style state control has once again been exposed, as per the Wilson and Callaghan governments and once again there are going to leave such a mess it will once again take a generation and much hardship to rectify.

By its very nature, and with a huge chip on its collective shoulder, Labour has never been able to create or preserve the wealth of the country it is only capable of taxing and wasting, creating stupid legislation and trying to remove the ability of people to think and act for themselves.

Unfortunately the ENGLISH people with have to endure another two years of rule under this Scottish Prime Minister and his Scottish Chancellor, neither of whom we elected, and then we can bring about the hopefully permanent death of Labour.

We really must now demand Freedom For England and put an end to the tyranny of the Labour's Scottish socialists that have set about the destruction of our once proud country.

tim, durham

There never was a new Labour! What we have witnessed since they got into power is old Labour time and time again. The only thing that has changed is that things have got worse, not better and as is always the case they got in with false promises and on the public's hope of change for the better, none of which has ever been delivered.
Verity, UK

Yes and simply because the majority of people with a brain, at last has come to understand that through the deceit,proflicacy and duplicity of this terrible party the UK is on its knees. It will take years to put the mess right and as usual the middle-income groups as always will have to pay the price - but then it always was 'Champagne Socialism' under Blair and now under Brown it's a matter of smoke and mirrors.
Rosalind Mercer, Bedford

New labour was only ever old labour plus spin.

Overall taxation has steadly increased since they came to power, the non-working class has been getting richer, spending has increased with little visible results, there's been target culture mania, inflation has simply been hidden in the housing markets (invention of CPI), national debt is spiralling and now it's all gone wrong. How was that any different to old labour?
Jim C, Exeter

New Labour is definitely still alive and kicking. Maybe if the nowadays-little-mentioned Clause IV was reinstated and actually implemented by the Labour Party, the Tories would at least have something to be a bit genuinely scared about.
Steve, Highlands, UK

It's not just New Labour? it's the death of Thatcherism and Reaganomics. The sacred cows have come home to roost!
Richard Porter, Maidenhead, UK

Of course it's not dead, they're addressing a global issue and overstepping party lines to do so. They have the experts at their disposal, and they've made an informed decision which, as history has shown, will probably pay-off. This shouldn't be seen as a party political issue, any sensible Government would carefully consider this line of action.
Constable, UK

New Labour has been dead since Broon took over.He IS old labour through and through and a Stalin type control freak with his fingerprints all over the pbr.New labour was a myth invented and acted out by Tory Bliar.Call an election PLEASE!
robert allcock, pershore england

New Labour is dead and so is Gordon Brown. Oh we had those fine words we will have no more boom & bust. Well I no longer beleive in Fairy Stories. This problem has been coming for a long time. We ahve got drunk on credit and now we have got to pay and we don't like it. Gordon Browns economic miracle was built on debt. The economy grew because of plenty fo remortgage.
ted, windsor U K

Dead as a dead thing can be and I have voted labour all my life, the cycle will begin again with the conservatives winning the next election. Lower fuel duty and everything else will fall, 2.50 in every 100.00 is a pathetic attempt to fool the masses. Gordon you have cocked up!!!!!!!
Paul Stebbings,

Obama's election did not turn on the issue of taxing the rich. Far from it. On economic matters it turned on the disasters that surfaced beginning in September and that have continued until now. Obama himself yesterday said that the Bush tax cuts, primarily for higher income earners, might simply be allowed to expire in 2011 rather than being immediately repealed.

Obama's economists, a smorgasbord of liberals, moderates and conservatives, can be counted on the craft plans that defy easy clasifications such as "taxing the rich."

Would that the BBC would avoid such easy, and apparently unresearched, characterizations.
Sam Davis, Birmingham, AL, USA

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