What Next For Labour?

The 2005 election, having stumbled blindly along in the gutter for five long weeks, soared briefly in the early hours of May 6th before keeling over and perishing in the blink of an eye. The verdict? At first glance it looked like death for all three major party leaders. Labour saw their seemingly unassailable three-figure majority cut by nearly 100. The Conservatives, while seeing a significant increase, never realistically threatened to get a result and ended up with 197 seats – significantly less than Michael Foot’s 209 low-water mark for Labour in 1983. The Liberal Democrats, meanwhile, having made much of their intermittent anti-war stance, failed miserably in their top Tory-hunting ‘decapitation’ strategy and gained a less than thrilling ten extra seats.

On the sunny morning of May 6th there looked to be no true winner in sight. And yet each party laid a less-than-convincing claim to success. Tony Blair gushed of his love for Labour activists at a victory party, then appeared with the family ensemble for the triumphant shots on the front step of Downing Street. Charles Kennedy proclaimed yet again that true three-party politics had arrived, avoiding the facts to deliver the platitude. Michael Howard didn’t say much at first, allowing the pundits and leader-writers to proclaim the rebirth of the Tories, with the Dover and Folkestone MP as the divine manifestation of such an unlikely event. They were left a little bemused when Howard popped up in the newly-regained constituency of Putney to announce that he had, seemingly overnight, become ‘too old’ to lead his party onto another electoral defeat. Hence the headwind looks set to peter out gradually in the face of a drawn-out leadership election.

While Kennedy’s miserly achievements will likely see that he survives to the next election, Tony Blair’s position as Prime Minister suddenly looks untenable. Labour’s biggest asset in 1997 and 2001 has – via Iraq, tuition fees and identity cards – become the party’s most significant problem. Wild-eyed psephologists have proclaimed, not without justification, that a Blair-less election would have returned another three-figure majority. Many of the fallen Labour MPs, such as Oona King and Barbara Roche, were Blairite loyalists who paid the price for their immutable subservience. There is a tangible left-wing makeup to the Labour MPs who survived on Thursday, and already the knives are out for Mr Blair. Without skipping a beat, the press has gone from election fallout to feverish speculation about the timing of the inevitable handover. Estimates range from a matter of days – with hostile MPs said to be arranging the demise of their leader even this early on – to eighteen months or thereabouts, with only one realistic conclusion being tenured: Gordon Brown’s long-awaited move into No. 10.

Rightly or wrongly, Brown is seen as having the Midas touch. His belated appearance on the campaign trail, and the unswerving dedication that he showed to the Prime Minister, apparently rejuvenated a battle that was being cumbersomely mismanaged by Alan Milburn. Brown’s stock has risen and risen during his time as Chancellor, and he has cultivated an image of honesty and integrity. The mere fact of his not being Tony Blair has elevated his popularity to stratospheric levels. Some Labour supporters predict that a clean and swift handover to Brown will see a newly-restored majority of well over 100 in 2010.

Yet there is one significant dark cloud on the horizon, and its repercussions could significantly change the state of play in the country over the remainder of the decade. On the eve of the election, several high street retailers reported extremely disappointing sales for the year’s first quarter. On Monday the Bank of England elected to keep interest rates steady at 4.75%, the ninth month without change. A 1.6% drop in manufacturing, as reported by the Office for National Statistics, adds further evidence that the economy is looking decidedly unwell. Should Brown assume the office of Prime Minister, and the economy go into tailspin, his reputation for fiscal prudence will quickly disappear. If his high-spending approach falters, the negative connotations could well taint the entire government. It must be remembered that until 1997 Labour was associated with economic incompetence. A downturn in the economy could be well exploited by the Tories and, and with Brown as the Prime Minister, they would have a highly visible target upon which to hang their accusations of ineptitude. In such a scenario it wouldn’t be particularly hard to imagine that a Conservative campaign, led by a charismatic figure such as the current party chairman, Liam Fox, could seriously threaten Labour’s period of government and the social successes that it has brought.

None of this, of course, may come to pass. The economy may recover and maintain its robustness. Brown could go on to be Prime Minister for a whole decade. Labour could become firmly entrenched as the natural party of governance and economic growth. Yet the next few years could also see financial security, a significant New Labour achievement, being slowly eroded. All those who now hail the impending Brown years with glee would be wise to beware the dark clouds gathering.