Whether by accident or design the Conservative Parliamentary Party have nominated two populists, both positioned towards the right wing of their party, as candidates to be their next leader. In the 24 hours before the final stage of voting, it appeared James Cleverly had the momentum. Perhaps as Conservative leader, Cleverly might have been able to reach moderate voters who abandoned the Conservatives in 2024, towards Tory gains in 2029. We now know that for the foreseeable, the Conservatives will be occupying political space much to the right of that claimed by the party David Cameron led until 2016.
There should then be an opportunity for the Liberal Democrats to make even further gains on 2024, and to clearly aspire to become His Majesty’s Official Opposition.
Of the 27 seats in which the Liberal Democrats came second in 2024, 20 of these are Conservative seats, six are Labour, and one is Plaid Cymru. Likewise of all 72 seats in which Liberal Democrats came first, the Conservatives came second in a whopping 64, the Scottish National Party in a further six, and the Labour Party in just two.
Taken together then, if the Liberal Democrats wish to hold on to 2024 gains and make further gains in 2029, we must maintain and build upon the connection we have with those voters – whom the Pimlico Journal recently called Yellow England – who might in different circumstances have voted for a more moderate and credible incarnation of the Conservatives.
With respect to becoming the Opposition, the Conservatives currently stand at 121 seats, the Liberal Democrats 72. So, all other things being equal, even if the Liberal Democrats were able to turn each of those second place seats yellow in 2029, the Conservatives would still form the Opposition.
Therefore we must go further and connect with other electoral tribes that we didn’t reach in 2024. The Green Party are seen by many who might otherwise vote Labour as the party offering a genuine alternative. If the Liberal Democrats are very clear on what we stand for we can increasingly appear as a real alternative for Government. Success with the clean waters campaign demonstrates how effectively the party can become associated with a distinctive message, and a serious offer on the environment.
There are other policy areas where we could demonstrate a clear offer, distinct from the Greens. The Green Party is sometimes for instance allied to ideologies around de-growth. We should be clear that as Liberals we will promote growing economic opportunity and social mobility. On housing Liberal Democrats propose Rent to Own whereas Greens want to abolish Right to Buy so that houses remain in ‘community’ (council) ownership. As was reported this week, deaths outnumbered births in the UK for the first time in almost fifty years. The Liberal Democrats already have the most ambitious policies on maternity and paternity, and as part of a greater package, including new thinking on home ownership, then we can establish ourselves clearly as pro-family.
It is necessary to go beyond individual policies and good ideas, to find our narrative; not just of what we believe, but more tangibly, what we stand for. What will a Liberal Democrat government look like, and what is our vision for a Liberal Britain in the world?
* John is Membership Development Officer for Leeds Liberal Democrats, an academic leader in Higher Education and as a psychotherapist in private practice.
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47 Comments
A really interesting read – I think Rent to Own and improved family leave policy are definitely fertile areas, and appeal to a liberal, meaningful freedom mindset without having to dance with conservative notions of what a family and a home must look like
Let us be clear: any attempt to move the Liberal Democrats to the right to fill the void left by the Tories moving further right, would be a disaster. The Liberal Democrats do not represent Tory-lite and never should.
“The Liberal Democrats do not represent Tory-lite and never should.”
Seconded
Spot on from @MaryFulton all this nonsense about becoming the official opposition to Labour is really annoying me. It isn’t going to happen, the Tories are going to get a bounce once their new leader is in place and the longer Labour are in office the more their disaffected supporters who stayed at home in July will return to the fold.
The future for our party lies in staking out a space on the progressive centre left in the way that the great Jo Grimond outlined during his time as leader. In tactically terms that means looking to hold as many of our existing seats as possible and if we can achieve that hope for a hung parliament where we can force a change to PR.
“Liberal Democrats do not represent Tory lite and never should”. A perfectly reasonable position to take, as long as we accept that the notion that we may be is why so many Tories in the shires will lend us their vote. Should we be more honest with them ?
The party needs to promote its own centrist agenda and not ape the agenda of the Conservatives , We are “the normal party” with a radical twist . We are equally strong on the environment and social policy as we are to promoting a mixed economy with a competative edge . rent to buy works but we should not be put off from providing social housing for the most vunerable in our society . lets remember the preamble to our constitution.
“With respect to becoming the Opposition, the Conservatives currently stand at 121 seats, the Liberal Democrats 72. So, all other things being equal, even if the Liberal Democrats were able to turn each of those second place seats yellow in 2029, the Conservatives would still form the Opposition.” When I went to school, and “all other things remained equal”, if one pile of 121 lost 27 to the other pile which had started on 72, then the first pile would have 94 and the second would be the larger by 5…..but of course “all other things” will not remain the same, so who knows what size each pile will be?
I think the tired old ‘left/right’ theories are really not relevant to our political system. What really matters is Liberalism vs authoritarianism. The late Donal Wade postulated an egg theory of politics with Liberalism at one end and authoritarianism at the other. Labour are on one side of the egg and the Tories on the other. Interestingly of course, fascism and communism are rather near each other on the RHS of the egg. [Looked at carefully, their ideologies are similar and their authoritarianism are almost the same] We are, of course on the LHS of the egg. So, one way of looking at our position is that we are at the Liberal end of politics and Labour and the Tories, although different in many ways are both headed towards the authoritarian end of politics.
Our role is to convince electors of both Tory and Labour persuasion is that our society needs to be more Liberal and less authoritarian and that our policies are the way to that end.
Becoming the official opposition is one step on the way to becoming the government. We won’t do that by aping the Tories or copying Labour [moving to the right or the left in traditional analysis] but by persuading enough voters that our Liberal approach is best for our country.
Holding the balance or joining a coalition is something we should seek to avoid, but may have to be contemplated if we continue to advance. Of course we must never do that again without getting PR for all elections.
@ David Rogers,
You are quite right with your arithmetic and it is a pity that John Hills’ calculator might have been misfunctioning, but his point about needing to take votes from other parties is, nevertheless, still valid.
The days of easy gains in previously Tory seats are likely over. Lib Dems will probably hang on to some previous wins but there will be losses too, the next time around. Any future gains will extremely hard to come by in Tory seats. There may well be none at all.
There will be far better prospects in current Labour seats if Lib Dems switch emphasis and direct their fire on them early enough.
@David Rogers and @Peter Martin I did worry for a moment about my arithmetic! But if Tories are on 121 and the Lib Dems take the 20 seats that we are currently second place to the Tories, plus the six Labour and one Plaid Cymru, then that would put Liberal Democrats on 99. The Tories, having lost 20 seats would be on 101. Therefore, all other things being equal, the Conservatives would still have two more seats.
@ John Hills,
Yes, good points! Your calculator is probably OK after all! 🙂
There’s a lot of knee jerk reaction to the idea of “Tory-lite”. I understand it but I think it is the wrong way to think about the issue.
There will always be a place for a party that is cautious about giving the state too much power, that sees the market and free trade as powerful tools for improving human wealth and that emphasizes individual liberty. Those are liberal values. Following the the rise of socialism at the beginning of the 20th century the Tories were able to monopolize that space as the Liberal Party split (with Liberal Unionists eventually merging with the Tories).
Today it seems impossible for the descendants of the internationalist Liberal Unionists to live with the nationalistic isolationist Tories. In a world (as Mark Pack reminds us) where people are more socially liberal that ever, reuniting those two liberal traditions is likely both to give our party more power and prevent a really nasty right wing taking influence again.
Yes, that means occupying a political space that some may see as “Tory- lite”. But it is consistent with Liberal tradition. Part of the attraction to this type of voter will be our refusal to compromise on human rights (including free speech and right to own property for example) and properly regulated markets and trade – fine liberal principles.
@Tristan Ward – I feel the same. The mindset that if we connect with an electorate that would typically vote Tory that we become Tory-Lite, or indeed that if we appeal to those who would ordinary vote Labour that we become Labour-lite, misses the point. The Liberal Democrats are, and must be, a genuine third force in British politics, with a vision for the UK in the world which is distinct from that of Labour or Conservative. As you observe, a free market which uplifts individual liberty, and an open internationalist orientation are principes that clearly differentiate our party.
@Jack Nicholls – absolutely. It would seem core to Liberal Democrats’ distinctive offering that whilst we can show substantial and deep support for families, whilst also recognising that families come in many different forms.
We are also distinctive in promoting a Liberal society in which ‘none shall be enslaved by poverty’, and a Fairer society where the extreme growth of income inequality in the last few years begins to be reversed, and within which we will promote the welfare of all our citizens.
We are also distinctive in promoting a Liberal society in which ‘none shall be enslaved by poverty’, and a Fairer society where the extreme growth of income inequality in the last few years begins to be reversed, and within which we will promote the welfare of all our citizens.
I’m not sure “a Fairer society where the extreme growth of income inequality in the last few years begins to be reversed” is that distinctive: both the Green and Labour party members would say the same.
Personally I think the emphasis should be on prevent of enslavement by poverty, ignorance and conformity.
Tristan Ward. I would think, Tristan, that the current Labour Party and Government can so far be noted for their distinct lack of interest in reducing inequality. I don’t know about the Greens, but it is our party which has a policy to end deep poverty within a decade, and I trust that we are going to promote that, together with the fairer taxation needed to achieve it and reduce the levels of inequality.
Tristan Ward (12th Oct 3.00pm),
You have a very mistaken view of the political history of Britain.
Neither the Liberal Party nor the Conservative Party in the nineteenth century was concerned with the power of the state. The Whig tradition was about controlling the power of the monarch, while the Liberal tradition was more about controlling the power of the landed gentry.
In the early twentieth century both the Liberal Party and the Conservative Party increased the role of the state. (Conservatives increased state power with the 1902 Education Act and during both World Wars). After the Second World War the Conservative Party was not really concerned about the power of the state. It was concerned about the increase in nationalised industries. It denationalised Iron and Steel and Road Haulage.
It was not until Thatcher that the Conservative Party wanted to reduce the size of the state, which continues today, especially with Conservatives often saying they want much lower taxes than at present.
The Liberal Unionist Party was formed in 1886 and merged into the Conservative Party in 1912 (https://en.wikipedia.org/wiki/Liberal_Unionist_Party). The Liberal National Party was formed in 1931 (they wouldn’t support the Labour Government and later did support protectionism) and after a name change in 1948 merged with the Conservatives fully in 1968 (https://en.wikipedia.org/wiki/National_Liberal_Party_(UK,_1931)).
Tristan Ward,
Liberal support for free trade didn’t include deregulating. The Whigs and Liberals supported regulation for factory workers, Gladstone’s Irish Land Acts increased the power of the state, as I assume did the introduction of death duties in 1894 by Harcourt.
I also like the phrase from the preamble to our constitution – ‘no-one should be enslaved by poverty, ignorance and conformity’. Do you agree this means that no-one should live in poverty, ignorance or conformity as to do so enslaves them?
As the party wants to end poverty how can this be done if we said we wanted to limit the power of the state, increase the power of free markets and reduce government regulation of them and instead of the state assisting people replace this with an emphasize on individuals having to look out for themselves in the name of increased individual liberty?
And John Hills,
The Liberal Democrats do not really support free markets and have always seen the need to intervene in markets for the public good. In the preamble to our constitution we state, ‘the market alone does not distribute wealth or income fairly’ and that the state should intervene in the market where necessary. As well as saying ‘we support the widest possible distribution of wealth’.
Thanks Michael. I think the question of whether the Liberal Democrats – or indeed any party that has formed a government in the UK – is in favour of free markets or not, comes down to some extent to semantics. I think that for most of us there’s no binary position where we either support free markets or we don’t. Is there a subtext here around whether Liberal Democrats are in favour of capitalism or against it? My guess is that most Liberal Democrats would recognise the reality of capital and that we seek to realise a Liberal society within that reality. (Though I realise that that too might trigger a whole other debate!)
The question – as I would phrase it – would be where government should properly intervene to ensure equality and expansion of economic opportunity. In my day job in Higher Education I have a lot of thoughts about this. But in reference to the Liberal Democrat manifesto, I identified a few examples of intervention that I think do demonstrate effective intervention – support for maternity and paternity, Rent to Own etc. Other interventions, such as state mandated access to Premier League football games, interfere in a free market without achieving anything substantial in promoting Liberty.
Getting back to the point of the OP, I might just suggest that Lib Dems should keep an eye on what is happening on the left if they want to optimise their vote in the next election.
The mainstream aren’t saying that much about at the moment and many on the left are keeping tight lipped too, but it’s worth a look.
The discussion is about the formation of a new left party known as “Collective”. Some quarter of a million members are reported to have left the Labour Party recently so it’s quite possible that it, if formed, could very quickly become the largest party by membership in the UK. There are, de facto, already a dozen or so Collective MPs in Parliament. Just how that will translate into votes in elections remains to be seen but I’d say removing 10 percentage points from the Labour vote would be the lowest estimate.
https://www.theguardian.com/politics/2024/sep/15/jeremy-corbyn-addresses-meeting-new-leftwing-party-collective
Very interesting Peter. It’s busy on the left… I would love to know why activists are drawn towards the creation of new parties – Respect, Left Unity, Workers’ Party, now Collective… rather than supporting the Greens. Perhaps because they’re intended to in some way appear as a ‘true’ Labour Party, potentially with the capacity to influence and ‘correct’ the Labour Party, in the way that Respect are seen by many on the right as ‘true’ Conservatives?
I would have thought the main reason they don’t back the Greens is that they are not green and neither are many of their target demographic.
John Hills,
There is no debate about whether the Liberal Democrats and the Labour Party accept we should live in a capitalist society. Both support regulated markets not free markets and a mixed economy.
Once it was said that Keynes saved capitalism, but since 1979 capitalism has been failing the people. I expect that those ex-Tory voters who voted for us and the Labour Party are not interested in free markets and free trade but are concerned that public services work much better and are not too bothered by taxes generally having to be increased to pay for them.
@ John Hills,
You’re right in pointing out that activists have often, in the past, become frustrated with the Labour Party and have gone off to form some new Left grouping which has made zero impact politically. I think the mistakes have been to think that it can be done without the backing of the broader Labour movement and also simply that the timing has been wrong.
However, the timing is probably right now as the election of 5 independent socialist MPs and 4 Green MPs shows. There are still obstacles to be overcome. Much of the left will have to get over its hostility towards the Greens, who have emerged as a serious organised force. They have done this by staying well to the left. Much more so than their sister parties in Europe. However they lack any roots in the broader Labour movement which will mean they can’t go it alone.
I’m not making any predictions about what will happen or when. Your guess is as good as mine. This will depend on how well or badly Starmer does in the next couple of years or so. I feel more confident in predicting this. It will be the latter! Reeves’ economics will be their undoing.
So some interesting developments are quite likely.
@Michael BG
“Neither the Liberal Party nor the Conservative Party in the nineteenth century was concerned with the power of the state. The Whig tradition was about controlling the power of the monarch, while the Liberal tradition was more about controlling the power of the landed gentry.”
The monarchy and landed gentry largely WAS the state, at least up to the Glorious Revolution (and probably beyond) for the Monarchy and until (say) the Parliament Act 1911 for the Landed Gentry, when the House of Lord’s ability to veto legislation passed by the Commons was abolished for money bills and curtailed for everything else.
In my view, as a general rule the Tories generally reluctantly supported social legislation, generally to buy off middle class and non-conformist, and latterly, socialist votes.
More recently it seems that socialism (both democratic and even arguably social democracy) has been rejected by electorates in the west – for good reason in my opinion – and so the right has been much freer to reduce its support for social legislation.
@Michael BG
Regarding the preamble to the constitution , I think a fuller quotation would be more useful to this debate; and I think it is clear from that that the Party is not as anti-market as you represent.
We will foster a strong and sustainable economy which enables people to thrive in their
communities, assessing progress by measuring people’s wellbeing. Such an economy
will encourage necessary wealth creating processes, develop and use the skills of the
people and work to the benefit of all, with a just distribution of the rewards of success.
We want to see democracy, participation and the co-operative principle in industry and
commerce within a competitive environment in which the state allows the market to
operate freely where possible but intervenes where necessary. We will promote
scientific research and innovation and will harness technological change to human
advantage.”
And of course:
We will work for a sense of partnership and community in all areas of life. We recognise
that the independence of individuals is safeguarded by their personal ownership of
property, but that the market alone does not distribute wealth or income fairly. We
support the widest possible distribution of wealth and promote the rights of all citizens
to social provision and cultural activity. We seek to make public services responsive to
the people they serve, to encourage variety and innovation within them and to make
them available on equal terms to all.
On the point about becoming The Official Opposition.
All Parties have to run just to stay in the same place, older Voters are continually dropping off & have to be replaced by younger ones. Over the last Decade The Tories have been uniquely bad at recruiting Young Voters & their remaining Voters are so old that a quarter will die off before 2029 – that would change the Electoral map by itself.
@ Paul Barker,
“Voters are so old that a quarter will die off before 2029 ” ? ? ?
How do you work this out? I suspect you haven’t but are simply repeating something you’ve read on Facebook!
We’ve got approx 4.13 years before then. There are approx 650,000 deaths per year. The number of registered voters is about 48 million. So even if we say all deaths are going to be of people who are of voting age and are registered this is only about 5.6%
Of course, you could be right if the UK ends up being involved in a major war in the next few years or the Covid virus evolves into a killer strain!
Do you know something we don’t? 🙂
@Michael: Capitalism has not been failing people since 1979. The vast majority of people today have a standard of living that is in historical terms extraordinarily high, and which has continued rising for most of the period since 1979. And that is largely thanks to capitalism. Yes there have been problems: A stalling of growth since around 2010, plus rising inequality, and that does suggest we need to adjust how we do some things. But those problems should be seen in the context that GDP and average standards of living overall remain historically high. It’s also worth noting that one of the biggest drivers of poverty since 2010 has been lack of housing, and there’s a good argument that a large part of the blame for that lies not with capitalism but with rapid population increase, combined with over-zealous regulation around planning, making it increasingly difficult to build enough new houses. If you blame capitalism, then you’re looking in the wrong place.
Also, saying that we (and Labour) believe in regulated markets isn’t really saying much. No-one – not even the most ardent free-marketeer – believes in totally unregulated markets. We all accept the need for some regulation, not least because markets can’t function without some rules. The disagreements tend to be over the nature and extent of the regulation.
“Capitalism has not been failing people since 1979. The vast majority of people today have a standard of living that is in historical terms extraordinarily high”
For loads of data and argument supporting the view that a liberal democratic post enlightenment approach political economy and political philosophy is responsible for the enormous gains in wealth and freedom see Steven Pinker’s “Enlightenment Now.” Highly recommended in the context of this debate
https://www.amazon.co.uk/Enlightenment-Now-Science-Humanism-Progress/dp/0525427570
@Peter Martin – in defence of Paul Barker’s arithmetic, he said that a quarter of Tory voters would have died by 2029. That implies a quarter of the 6.8m ie 1.7m. Given five years at 650,000 total deaths per annum this suggests that 3.25m will die from the general population. for Paul’s statement to be correct over half of these would have voted Tory in 2024.
So its clearly an exaggeration, but if we assume turnout amongst the elderly is higher than average say 75%, according to YouGov (https://yougov.co.uk/politics/articles/49978-how-britain-voted-in-the-2024-general-election) 46% of over 70’s voted Tory so it isn’t hugely wrong.
Peter Martin. You misread what Paul Barker said. He was talking about a quarter of TORY voters dying off, not a quarter of voters. If he’s right that many Tory voters are old, then his figures could be correct and that WOULD have a big effect on elections.
Tristan Ward,
When you are considering the history of the Conservative Party you should see a Conservative Party that supported Lloyd George’s social progamme after 1918 and was very concerned with running the economy according to Keynesian economics 1951-64. It was under Maxmillian as housing minister that the UK first met the target to build 300,000 houses a year in 1953.
Your longer quotations from the preamble include what I had written!
Simon R and Tristan Ward,
Between 1945 and 1979 in the UK capitalism worked well with increases in standard of living for everyone and reductions in inequalities. However, between 1979 and now there has only been a small increase in the standard of living. Millions of people have lived in unemployment during this period plus inequalities and the number living in poverty have increased. This is why I wrote, ‘but since 1979 capitalism has been failing the people’.
It is good that you, Simon, agree that the Liberal Democrats and the Labour Party believe in regulated markets and even now you are saying no political party believes in free markets.
Tristan, I didn’t say that since the enlightenment there has been no standard of living improvements.
@ Nigel @ Mick,
Yes point taken about it being Tory voters. I was taking “by 2029” to mean the start of the year so the end of 2028 which is why I came up with the figure of 2.7 million deaths.
I still think 25% is an exaggeration. The reason that there is a higher percentage of Tory voters is that typically we tend to move to the right as we age. So
@ Nigel @ Mick,
Sorry that last comment somehow shot off before I was ready.
To continue:
So as one elderly right wing age group dies off another slightly younger age group will move to the right and take their place. As the Guardian article below puts it:
” But for the moment, vote choices appear largely driven by ageing, not generational, effects.
This means that the Conservatives probably shouldn’t be too worried about their support base thinning out and being replaced by younger, less conservative generations.”
https://www.theguardian.com/commentisfree/2015/nov/03/do-we-become-more-conservative-with-age-young-old-politics
John Hills. In building a Liberal Britain we will need to pay heed to the welcome diversity of our population now, where growing numbers are of Asiatic background, and some MPs have just been elected because they apparently represent Muslim communities in our cities. There are notable numbers of Cabinet and Shadow Cabinet members of different ethnic backgrounds, who have seemingly adapted to the Conservative or Labour parties’ political beliefs and practices, but I did not see many black or brown faces among our new MPs and the hundreds of activists at our final triumphant rally which ended the Brighton Conference. Our internationalism should make us acceptable to the rapidly growing numbers of our citizens who come from families of Asian, Caribbean or African backgrounds, but I think we shall need to work at getting to be known by them as worthy pillars of the British political system.
People tend to remain wedded to the social norms of their youth or young adulthood. The views of the oldest generation are generally the most conservative but those views change over time. Tomorrows octogenarians are likely to be racist, mysogynist and homophobic than today’s. Over the years, the Tory party has changed in the same direction and has generally held on to the most socially conservative third of the country. Right now, however, they are not adopting the views of the middle aged but sticking to those of the current elderly so the demographic changes will hurt them significantly.
Not everyone votes on social attitudes though. The Tories will benefit from not having the chance to mess up the government finances. With luck they won’t even have a chance to mishandle many county budgets after May.
@Michael: Look at this graph which shows the UK’s inflation-adjusted GDP per capita since 1955: https://www.statista.com/statistics/970672/gdp-per-capita-in-the-uk/. You’ll see GDP has practically doubled since 1979. Far from stagnating after 1979, GDP was growing faster during the 1980s and 90s than previously – exactly the time when markets had been liberalised under Mrs. Thatcher.
So, while accepting that GDP only approximately maps to standard of living, it’s a bit of an understatement to say that’s only a small increase. There has certainly been a problem since 2007, but even there, you can see real per capita GDP has at least largely remained static, despite all the World problems we’ve had since then. That looks to me overall like a success of capitalism, not a failure.
To clarify my late-night musings on ethnic diversity and our relationship to minority ethnic groups, I looked up the statistics of the British population in 2021. We are 81.7 % white, down from 86% at the 2011 census. As to my non-defined ‘Asiatics’, it seems that 9.3% identified as Asian, Asian British or Asian Welsh, up from 7.5% ten years ago. The largest ethnic minority population are black British citizens with African and/or African-Caribbean ancestry at 3% of the total, while Indian Britons make up 2.3% percentage of the total population. I am wondering how well Liberal Democrats can relate to and appeal to the 9.3% population identifying as Asian. The poorest populations in our cities are often seen to be of ethnic minority background.
@Katharine Pindar You make a really important point. I see there are some efforts by the party currently to encourage people from minoritised backgrounds to stand as candidates.
@ Simon R,
The growth rate was still good prior to 1979, so whatever the motivations for a change in macro- economic thinking, with traditional Keynesianism being replaced, it hasn’t just been to improve matters in total. It was relatively successful at first because it replaced a reliance on public debt with an increased level of private debt which certainly appeals to neoliberals. There is a limit to the extent we can do that though. A high level of private debt can turn to a high level of bad private debt and bring about a crash. 2008 style.
If we measure gdp the same way as Germany we come out significantly worse, so some 10% is added to allow for the imputed rental values of property owners. Anyone owning and living in an average property will be allocated an income of £1000+ per month which many would argue doesn’t exist.
Google {gdp imputed rental values}
Still the evidence is that economic growth isn’t going to solve problems of poverty. The distribution of goods and services, can’t be ignored. Yet, we have a supposedly Labour govt who are ignoring it in exactly the same way as Tories have always ignored it.
Reeves tells us that as GDP increases we’ll be able to afford more nurses and teachers etc. Even if this does happen, they will be more expensive as they will expect to share in the increased prosperity . Google {Baumol effect}.
We need a more holistic approach to economic thinking.
@Peter: I would say that on the contrary, the evidence is that economic growth is absolutely necessary to solve poverty. Consider how levels of destitution today (although still too high) are massively lower than they were in the 1920s or 30s or at any time before then. Yes partly you can attribute that to more generous welfare today, but mostly that’s down to the massive economic growth that’s happened in the past 100+ years.
The problem is that, instead of looking at what people reasonably need to live, we insist on measuring poverty as a % of median income, which is (a) wrong because that’s measuring inequality not poverty, and (b) completely self-defeating because it means that as soon as the economy grows, our poverty-reduction goalposts move. If we used a more realistic definition of poverty, then it would be clearer that economic growth is an essential part of tackling poverty.
But I guess this is starting to get off-topic for this thread 🙂
@ Simon R,
The thread is about how Lib Dems and their political space. I seem to remember being told that this includes “no-one being enslaved by poverty”. So this discussion should be OK.
We probably do need to ensure that we produce more than we did in the 1920s but how much is ever enough to remove poverty? It will never be enough under the present system. According to GDP figures, we are at least twice as well off as we were in the 70s. I wasn’t earning a fantastic amount in the late 70s, maybe £5k-£6k p.a. which was the going rate at the time, but still managed to buy a house, no parental support, with three children who followed in the early 80s. I was the only earner. Admittedly we struggled through from one pay day to the next but we just about managed with a bit of ducking and weaving!
If we take GDP figures naively at face value, someone in their early twenties could earn half the current going rate and still do the same thing. In reality there’d be no chance of that of course.
But why not? The answer is that economy isn’t just about GDP, it is about everyone’s place in the social and economic hierarchy. So we can’t understand why we have poverty without looking at the bigger picture and this does involve an understanding of how wealth and income is distributed and comparing that with how it should be distributed.
Peter Martin and Simon R. You point out the clear fact, Peter, that the income from paid work that enabled you and me to buy our houses in the late 70s might seem comparable to that earned by young people today as a proportion of GDP, but we know that too many can’t afford it. I bought my first house at age 30, but nowadays there are young people still living in the parental home in their thirties, unable to rent or buy for themselves. There is a vast economic disparity between those acquiring, sharing or being gifted with wealth today and those earning even what seems to be a decent income. The likelihood of fairly recently established ethnic communities in England having wealth to share or hand down to their children seems improbable, which may help to account for especial poverty among many of them.
The current and continuing inequalities should surely be tackled by the Labour Government, and we should be thinking about how we can support that effort.
As for poverty itself, Simon, it is good that there are set-out definitions of poverty, deep poverty and very deep poverty, whatever their limitations, so that our people can resolve to fight against them. Too much arguing about different measurements allowed, for example, PM Rishi Sunak to claim over and over again at PMQs that the Tory government had been successfully reducing child poverty!
Simon R,
As you say ‘GDP only approximately maps to standard of living’. You could argue that because the richest 10% have done really well since 1979 this means capitalism has not failed. However, I wrote capitalism is failing the people not that capitalism is failing. The level of poverty and inequalities is a much better way of seeing if capitalism is failing the people.
The graph of Income Distribution in the UK https://media.equality-trust.out.re/uploads/2024/07/incomedistributionovertimeuknew-1536×754.png clearly shows the widening gap between the top 10% and the bottom 50%. In 1970 the top 10% had 26.5% of the income while the bottom 50% had 21.4%. By 2013 the top 10% had 38.6% of the income and the bottom 50% had 18.4%. The difference had increased from 5.1% to 20.2%.
Looking at the proportion of the population below 50 per cent mean income,
1961–99 (https://eprints.lse.ac.uk/3913/1/One_hundred_years_of_poverty.pdf) page 46 it can be seen that in 1961 only about 10% of the population had an income of below 50% and by 1995 this had risen to about 22.5% after housing costs. It can be seen that the lowest level was reached in 1978 before Mrs Thatcher’s general election victory in 1979.
Welfare payments are not more generous today. The level of benefits as a percentage of average weekly earnings has decreased from 33% in the 1960s to 17% when benefits were temporary increased by £20 a week. And after this increase was removed it must be lower than 17%.
A lot of talk of income inequalities…
But the root cause of the UKs problems are long-standing wealth inequalities.
Particularly the massive land holdings of the very rich. Who are able to maintain or even increase their wealth using the yearly rental incomes, which can easily exceed the lifetime income of professionals such as doctors, lawyers, architects, etc.
This income that is gained with minimal effort and zero innovation is a serious drain upon the rest of the economy because money is extracted from all other economic activity government, household or business.
This problem is particularly acute in the UK.
It is not free-market capitalism, this elite are the opposite of the entrepreneurs that tend to innovate and grow the economy.
These wealth inequalities were worsened by Quantative Easing, which devalues the currency, because the poor are paid in cash (GBP) and the lower-middle class usually only have savings in cash. Meanwhile the upper-middle class have a mix of assets, and the rich have tangible assets (land, property, etc).
Sadly all that so-called “lefty” Labour will do in the upcoming budget is some tinkering around with taxation / spending / benefits which will not address the fundamental structural problem.
It would probably require special cross party legislation to cap ALL rents, and increase CGT/inheritance on land and treat any land transfers via holding companies in a similar manner.