Corbyn is clearly right to highlight the ‘grotesque inequality’ in our society. Wage growth has stagnated. Continued cuts are hitting the poorest hardest. And this generation is on set to be the first on living memory to be poorer than their parents.
Even if you try and ignore the unfairness, the evidence shows it harms productivity and creates the sort of ‘asset bubbles’ that caused the 2008 financial crisis.
But I have one question. Where are Labour’s answers?
At first glance the most radical is renationalisation. But this is nothing more than a recycled plan from the 1970s. It just tinkers at the edges of inequality, and carries significant risks for our future economic and energy security.
Next comes Labour’s big ticket spending item. Abolishing tuition fees. Our higher education system is far from perfect, but how many better ways could we spend £7.5 billion a year? What amounts to a tax cut for the middle classes does absolutely nothing to tackle inequality.
Most significantly, we have some Labour economic doublespeak – ‘borrowing to invest’ in public services. While the NHS, for example, clearly does needs to be better funded, ‘invest’ falsely suggests that we get an economic return on borrowing for public services. That it will all be fine.
And this, maybe even more than Brexit, is the big danger of a Labour government. The government is already, as the Prime Minister admitted last week, spending more on paying interest alone than the entire schools’ budget. Labour’s borrowing plan would mean future generations would have to pay higher taxes and spend even less on public services.
We demand better. The Liberal Democrats have a genuine, radical plan to combat inequality.