Corporate lobbyists have successfully pushed Keir Starmer’s party to ditch its progressive policies
Over the summer, Keir Starmer's Labour Party for the first time articulated a clear vision for government: everything will continue to be awful. Nothing will get better. Hope is for fools. And, most importantly, no one with wealth or power need worry themselves that any of either will be taken from them.
Because despite two-thirds of voters wanting the government to increase wealth taxes, shadow chancellor Rachel Reeves last month emphasised that she won't. And although 63% of Brits think taxes on the rich are too low, Starmer has made clear that he doesn't want to raise income tax for top earners, saying his driving principle is, rather, to lower taxes. Only 5% think the rich pay too much tax.
Meanwhile, Labour's £28bn-a-year pledge to invest in a Green New Deal - a plan to boost the transition to a zero-carbon economy - has been cancelled by Reeves, who stressed a need for 'fiscal discipline'. The policy has wide support among voters, particularly in key marginals in England's North and Midlands.
Also on the party's scrapheap are popular plans for a publicly owned energy company and a tax hike on digital giants such as Facebook and Google, as well as pledges to replace Universal Credit and scrap the two-child benefit cap.
A certain portion of the press - both Conservative hacks and Blairite shills - see all this as genius: if Labour steals the Tories' story, how can Rishi Sunak attack? And in a way, though not the way they mean, they may be right.
Wealth and political power are enormously concentrated in Britain. Since 1945, Labour has only ever got into government when it's made very clear that it doesn't intend to challenge the ruling elite.
As we saw with Jeremy Corbyn, our oligarch-controlled media, the City and even army generals won't allow any suggestion that the party plans to govern in line with the egalitarian desires of the overwhelming majority of voters.
In the battle of a general election, the cultural grip of the UK's establishment is strong enough to override voters' policy preferences. Actually doing the things voters want - taxing the rich, renationalising key services and tackling the climate crisis - would mean taking on institutions powerful enough to take you down. Or, at least, that's what many Labour strategists have effectively concluded, even if that's not how they would express it.
Of course, you can argue against that. Maybe establishment institutions are losing their grip. Perhaps the Tories would still lose the next election if Starmer stuck to his promise to run on the left.
On the other hand, it's possible that the Labour leader being such an obvious liar - getting himself elected by his party on one set of promises and then immediately breaking them - will allow the Tories to successfully take him down. But more likely, it will make his first term as prime minister very difficult, and leave a festering anger that the right will exploit.
Cock-ups and corruption
Over the past few weeks, I've revealed a series of scandals about Labour.
The party accepted an illegal donation of £600,000. Starmer has accepted more corporate freebies over the past two years than every other Labour leader since 1997 put together. The shadow business secretary, his wife-come-senior-assistant, and a senior Starmer staffer accepted luxury Glastonbury tickets from Google, then announced they were scrapping plans to hike the digital service tax the next day. Shadow cabinet members, including Starmer, have corporate lobbyists placed in their staff teams.
Most of these stories boil down to at least one of the various C-words that shape so much of our politics: cock-up, conspiracy, co-option, coercion, collusion, corruption, capture, cooperation and class interest. Each is, in its own way, revealing.
In the first story, I showed that the Barnes and Richmond Labour Club had given the central party an illegal donation of just under £600,000. This seems to have been an example of the first C - a cock-up.
The money came from a local Labour club selling a building that had once been used as a social club for members. The club's treasurer had given the cash to his local party through the national party in order to comply with regulations. But the national party seems to have failed to deliver it: within five minutes of going through their donor list, I could see that they'd broken the rules.
One local Labour club messing up isn't a big deal. The fact that the central party cared so little about obeying transparency laws that one of its biggest donors in recent years inadvertently broke them, is. For all of Starmer's emphasis on competence, the party he leads seems not to have invested enough in training its staff in the laws governing political finance.
When we broke the second story, about Starmer's freebies, and the third, about Jonathan Reynolds' trip to Glasto with Google, there was a pretty ferocious reaction online. The word people kept coming back to was 'corruption'. But I'm sure that, in his mind, Starmer doesn't think there is any transaction going on; he's not accepting gifts from the gambling industry in exchange for future laxity with gambling laws. They are just inviting him, he presumably thinks, because they enjoy the glamour of having the likely next prime minister on their arm.
And, the labour leader's internal monologue might argue, it's perfectly appropriate for him to hear from and experience the wares of various British industries. In any case, if a politician was selling elements of public policy, they could do a lot better than a four-course meal with fizz in a special box at the races.
A better word for what is going on is 'co-option'.
The social theorist Ralph Miliband - dad of Ed and David - documented how the same thing was done to the very first Labour MPs, a century ago. While some of the establishment was horrified by the arrival of these cloth-capped working-class men in the hallowed halls of the Palace of Westminster, its cleverer figures knew just what to do. They took them out for dinner at their smart London clubs. They introduced them to their wives, and to fine wines. They inducted them into the ruling class.
The consequence was that the first Labour administrations in the 1920s governed very much within the rules set by the establishment they had been socialised into, including pushing through massive public spending cuts after the Wall Street Crash, rather than devaluing the pound. What we're seeing now is the same process of co-option in post-Corbyn Labour. Only now, it's not so much co-option into the old ruling class - though we get a whiff of that in Starmer's days out at the races - but into the glitz of big business: tickets to the Brit Awards, the best seats in the nation's swankiest football stadiums, the luxury end of Glastonbury.
Part of the message these businesses are trying to convey to Labour folk will be expressed verbally, over sips of champagne or between the amuse bouche and the appetiser. But part of it comes in the setting itself: it's much harder to see Google as the bad guy when you've sung along to Elton John with its team, while tipsy on its tab. It's much easier to go soft on elites once you feel part of them, to see things from the perspective of a multi-millionaire if you're watching the football from the premium suite than if you're cheering from the stands with the fans.
You see a similar phenomenon with sponsored events at Labour Party conference, as revealed by my colleague Ruby recently. Often, these are luxurious affairs - I can still remember the delicious beef and truffle canapés I got from a firm pushing freeports a few years back.
Businesses with policy agendas invest time and money in buying nice things for politicians and their staff because it works - not in the simple transactional way that a word like 'corruption' implies. But in subtler, softer ways. If it didn't, they wouldn't do it.
Cooperation is important, too. While members of the cabinet have special advisers funded through the civil service, their shadows don't get equivalent staffing support - and the resources aren't distributed equally. Some members of the shadow cabinet have just one adviser, funded by the Labour Party, others have whole teams, paid for by major donors.
It's generally those associated with the right of the Labour Party who seem able to attract the funding of the handful of hedge funders and millionaires who chip in to such things. As a result, they get the researchers and spinners who make them look more competent, allowing them to deliver more, to grow their profiles, to succeed.
Peter Kyle, for example, who has recently been appointed shadow secretary of state for science, and who is associated with the right of the party, has been given £50,000 by wealthy financiers over the past year. Jonathan Ashworth, who was shadow secretary of state for work and pensions and who is seen as being on the soft left of the party, got no such donations, and was demoted to paymaster general in the recent reshuffle.
Other recipients of large amounts of private cash include shadow chancellor Rachel Reeves, shadow health secretary Wes Streeting, and shadow home secretary Yvette Cooper - all of whom are associated with the right of the party. Shadow cabinet members who come from the 'soft left' don't get anything like the same support.
There is no suggestion of impropriety here. Kyle and pals genuinely believe in policies that are good for their banker backers, while Ashworth et al are less keen. But the result is that the one on the side of the super-rich gets to have a super-sized staff team, and the political muscle which comes with it.
This phenomenon is not limited to shadow cabinet members. The Labour Party has changed its policy over the past few months, and has subsequently been richly rewarded with a surge in large donations.
Since becoming leader in 2020, Starmer's Labour has struggled for money. Membership - and the revenue it provides - has dropped by 170,000 in the past three years, while trade union contributions have fallen by more than a million since 2018.
But the party's latest accounts, which came out this week, show that the shortfall has now been more than bridged by large donations from rich people and companies. In 2018, the party took £700,000 in donations above the £7,500 reporting threshold (or £1,500 for local parties and the like). So far this year, it's already taken £12m.
The policies that Labour has ditched in recent months may have been overwhelmingly popular among voters. But they weren't, it seems, with its wealthy potential donors.
It's not surprising that lots of businesses want to shape Labour policy. Polls show that the party will likely form the next government, and corporations want to make sure it won't get in the way of their plans to extract as much profit as they can.
In one of its newsletters this week, Politico quotes Alice Perry, associate director at H/Advisors Cicero and a former chair of Labour's ruling National Executive Committee, as saying that demand for insider advice on how to lobby Starmer's team has rocketed since last year. According to the website: "You can't move in SW1 without meeting one of the new bespoke 'Labour units' being set up by lobbying shops or their latest ex-Labour hire."
The revolving door goes the other way, too. As I revealed earlier this week, at least ten current staffers for shadow cabinet ministers previously worked as corporate lobbyists.
But the revolving door between lobbying agencies and the top of politics is old news. And at least a revolving door means you are either in or out at any given moment. Starmer and his colleagues, however, seem to have found a new way to blur the lines: taking on staff who are still employed as corporate lobbyists - seconded from their usual work to the Labour Party. Much of the shadow cabinet is, in other words, directly collaborating with the lobbying firms trying to sell access to them.
Commercial lobbying exists to help those with money get extra influence over governments. The inevitable corollary is that ordinary citizens will get, relatively, less say. As such, its point is to distort democratic processes, to bend them to the will of capital.
In the dying days of the last Labour government, a string of former cabinet ministers were caught offering themselves for hire as lobbyists. The ensuing scandal contributed to a sense that the party's time in office was coming to a somewhat sordid end, and coincided with a dip in the polls. But that was after 13 years in power.
If the party is willing to so openly collude with corporate lobbyists when it ought to be fresh faced and ready for office, then voters will hear its message loud and clear: don't expect anything to get better.
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