Holding Labour to a high bar

Well, let's see how the reality of Britain's 'mid-term' elections played out after my curtain-raising preview last Thursday afternoon.

First: Labour, led by Ed Miliband (above). How did they do in jumping the admittely high bar I set them last week? This was, if you remember: (a) win 1,000 English council seats; (b) help prevent a pro-independence majority in the Scottish Parliament; (c) win an outright majority in the Welsh Assembly; and (d) try to help the 'yes' campaigners avoid getting completely buried in the Alternative Vote referendum.

So how did they do? Well, it was four strikes: no, no, no and no.

That's a pretty bad run.

Labour did, to be fair, make quite a lot of progress. If we run through the positive side of the equation, they gained 857 council seats (just about what I predicted); came just a whisker away from an overall majority of 31 in Wales (they now hold 30 seats); and at least, giving the conclusive thrashing the 'yes' campaigners got on AV, won't be losing any seats to the Liberal Democrats at the next election.

But even here, there are a number of great big flies in the ointment. Most of their gains were in the North of England, where they re-established their urban bases and ran the Liberal Democrats out of town. In Manchester, Sheffield, Liverpool and Newcastle, the Lib Dems took a fearful pasting that they will struggle to recover from - if they ever can. But in the South, it was a different picture. Let's go to Swindon, Reading, Harlow and Dover - places that I've talked about before on this blog, and towns where Labour has held seats as recently as last year. What happened here? Well, a little bit of progress - gaining two seats in Swindon, three in Reading, three in Harlow, and four in Dover. But there was no real sense that Labour would win those Parliamentary seats back in a General Election: only Reading isn't under Conservative leadership today. That's a crushing blow to hopes of a majority Labour government any time soon. In Wales, similarly, almost all of Labour's progress was against the Liberal Democrats and Plaid Cymru, the nationalist party. Where they faced off with the Tories - in Carmarthen West & Pembrokeshire South, Preseli Pembrokeshire, Aberconwy and Clwyd West - they got just about nowhere. They need some of those seats, too, if they're to return to power on their own.

In Scotland, Labour took a phenomenal beating that will leave scars on the party's psyche for years to come. They got absolutely battered in their own back yard, in a result far, far worse than even the most optimistic SNP supporter dared dream of. I thought there was an outside chance of the nationalists being able to have their referendum with Green and Independent support at Holyrood. Never did I think things could get quite so bad for Labour north of the border. A fatal mix of complacency, poor leadership, a 'British' message about the Tories in a Scottish election and a collapse in the Liberal Democrat vote stoved in Labour's electoral position. Their vote count didn't actually fall that much (by 0.5 per cent in the constituency part of the battle), but as other unionist parties retreat, the SNP advances. The whole debacle must raise questions about whether Labour can ever again rely on so many Scottish MPs at Westminster - in the event that Scotland stays in the United Kingdom at all, which must be now in doubt.

I'll have a look at the other parties tomorrow. But for now, there's a really important lesson here that's being overshadowed by the Liberal Democrats' grotesquely bad and almost pathetic performance. In their present shape, with their present image and in the present electoral landscape, Labour's chances of gaining an overall majority at the next UK General Election are not exactly zero, but they're certainly not approaching evens.

Tomorrow: the Liberal Democrats and the Conservatives.

So what does Barnsley really tell us?

So - Labour has won another by-election pretty convincingly. The Liberal Democrats have been humiliated again - getting a 'kicking', according to their candidate.

The Lib Dems came sixth. It's got to hurt, this - all the more so because this used to be the party of the by-election... Remember Eastbourne in 1990, which hastened the end of Mrs Thatcher? Remember Christchurch in 1993, at which Diana Maddock overturned a huge Conservative majority on a 34 per cent swing? Ah, glory days. They must seem so long ago. Some bloggers have taken to calling their leader 'toxic Clegg' and, while this seems rather strong, he's certainly not the electoral asset he was so briefly last year. With some polls (for what they're worth) showing the Lib Dems' desperately-needed Alternative Vote reform now way behind, the storm clouds have continued to mount up for the Yellows.

Nor will the Conservatives rest easy. Their vote fell precipitously too, slinking away to UKIP and the BNP - both right-wing parties who'll be crowing that the Tories' new liberal face has lost them votes among right-thinking citizens.

Even so, Labour will hardly be punching the air this morning. In a solid working class northern town, they beat a neo-liberal government cutting services on a low turnout. Excuse me while I stifle a yawn. In fact, the danger for Labour is that they retreat further into the comfort zone that the election of Ed Milliband as their leader perhaps suggested. Everything we know about the polling suggests that Labour's lead is rather small, reactive and soft - that it is made up of people defecting from the Lib Dems, yes, but also from 'don't know' or 'don't usually vote'. Unless Labour's really careful, all that will melt away again if and when the economy recovers.

The test for Labour is not how well their message goes down in Barnsley. It's how it goes down in Crawley, Hemel Hempstead, Harlow, Dover, Swindon South, Hove and Reading West - all seats in the south of England they've held in the last ten years, and all seats they must win again to hold power in their own right. Will voters there warm to the soft left and the defence of public services per se? I doubt it. There is absolutely no doubt that the public want the deficit addressed, and that, rightly or wrongly, they think the last government overspent and overborrowed. Labour has to change that perception, or more likely, change the question and the subject. By-elections don't force you to do that. General elections do.

So what does Barnsley tell us? Not much.

We'll have to wait until May, and the Scottish and Welsh national votes, the AV referendum, and English local authority elections to look deeper into our crystal ball. Rest assured we'll be doing just that.

Wanted: policies for economic growth

Following last week's seminal speches by Ed Miliband, Leader of the Opposition, and his Shadow Chancellor, Ed Balls, the battle over the rights and wrongs of austerity is all but over. The Labour Party has been by electoral necessity - and the ticking clock of the electoral timetable - to talk now about the future, rather than the past. That means that all our long national arguments about 'the cuts' are a bit redundant now.

This blog has always argued that the austerity measures imposed in 2010 were misguided, especially rhetorically, and based on the false premise that the best way to reduce Britain's debts was to cut government spending immediately. Looking back over three years of anaemic growth, that doesn't look like such a bad set of arguments, now does it?

That's all a bit academic now. We are where we are - and that's going to mean at least two or three years of extreme public spending restraint whoever wins the next General Election.

But don't get the idea that this means that all macroeconomic arguments have ceased. Oh no. Quite the contrary. What it means is that we have to start thinking about how to speed up economic growth - in the end the only possible way to conquer big deficits. Just look at the US experience. Growth there is now reducing government spending faster than expected in the short term, and though the Americans' federal budget faces plenty of challenges over the medium- to long-term, things look relatively rosy in Washington compared to London and Paris right now.

A mix of spending restrating and new priorities meant that most Blairite of truisms - hard choices. How might Labour speed up growth? Here's four ideas. You can write your own if you'd like, and I bet you'd do better than

Houses, houses, houses. Britain faces one massive structural deficit we can all agree on: that of good, honest, basic dwellings for people to actually live in. Forget bad, misguided, mean and downright grotesque policies like charging tenants for 'underusing' rooms (the so-called 'bedroom tax') - which only reveal, in their turn, just how few options anyone without tens of thousands of pounds in their pocket really have. Forget pump-priming the housing market for the middle classes via the absurd Help to Buy scheme, an endless car-crash of a policy that keeps on giving. Just build more houses. Millions of 'em. Only that basic effort will stop us running slap-bang into another housing boom and crisis. If you have to slow welfare spending, perhaps by raising the state pension age sooner than expected, or means-test more, or cut elsewhere, do it. Just do it.

Science and technology investment. Actually, George Osborne as Chancellor (above) has been relatively clear that he agrees with this one. He'd better deliver - perhaps by moving health research into the relatively protected NHS budget - because if he doesn't, then one of UK PLC's main competitive advantages will be ruined. Pharmaceuticals? Aeronautics? Computer software? Technical instruments? In these Britain continues to lead the world - partly because it's got a world-class university sector that punches well above its weight. At the moment, the Government's ridiculous ring-fence around lots of lots of spending means that it's these (actually productive) budgets that are being squeezed. A new government will be able to lift the restrictions around the health service, foreign aid and defence procurement, and move money around more freely. Mr Osborne or Mr Balls could then make science R&D one of his top priorities.

Talk up the economy - and talk up infrastructure. Think of a country with laughable infrastructure - roads, rail, rapid transit, airports - and historically very low interest rates. What should it do? Yes, that's right - borrow to fire up a growth cycle akin to Asia's (£). Again, the Treasury have been tinkering with this, trying to lever in private money and Chinese investment. But they could go much further. A new (or renewed) government might be in a position to re-write the fiscal 'rules' on infrastructure spending, for instance in terms of urban bondraising for new trams and underground transit systems. It's no accident that London's been doing better than the rest of the country, for the reshaping of Crossrail, from Reading to Essex, is helping to change the economic weather - along with the capital's other advanges. Here again, we could do more.

Reverse engines on immigration. One of the more depressing elements of the current administration's sometimes-tawdry populism is its attitude to immigration. For all its problems, the influx of people over the last forty or fifty years had made Britain richer and happier - its people better paid, the economy more open and efficient, British companies able to hire who they like. Since 2010, Ministers have managed to hang a 'closed for business' sign up at Dover - with deleterious effects on family life, on growth, on university recruitment, and on the quality of the skilled workforce. It is to be hoped that a new government might return to a points-based immigration system, and cut out the ridiculous talk of getting to under 100,000 in net migration every year - an impossible goal if ever there was one.

There you have it - some new priorities. Better than arguing about the pace of cuts, isn't it?