Posts Tagged ‘John McDonnell’

I had the pleasure of listening to Labour Shadow Chancellor of the Exchequer John McDonnell tonight at the S.O Davies lecture at Merthyr Tydfil Labour Club and had the chance to shake hands and a brief chat afterwards.

Really nice fella. He delivered a very good unifying speech.

Shadow chancellor John McDonnell at Merthyr Labour club delivering the S.O DAVIES lecture last night

The End of the UK’s Political Consensus:

It was an extraordinary few days in Brighton where the UK’s Labour Party held their annual conference. Labour’s detractors will focus on the squabbling over the UK’s nuclear deterrent on the final day when the real headlines should have been on the Labour Party’s unanimous rejection of austerity. The era of political consensus between both Labour and the Conservative Party are well and truly over. The lines are drawn in the sand, and the speech by John McDonnell clearly outlined the challenges Labour face in changing the narrative surrounding the UK economy and austerity economics.

John McDonnell’s Speech at Labour Party Conference September 2015

John McDonnell’s speech was, by far, the most surprising of the entire conference. Before he stood up political commentators from all sides braced themselves for some left-wing ‘lunacy’ economics. They were left disappointed.

“Let me explain the significance of what we are doing today. We are embarking on the immense task of changing the economic discourse in this country. Step by step: First we are throwing off that ridiculous charge that we are deficit deniers. Second we are saying tackling the deficit is important but we are rejecting austerity as the means to do it. Third we are setting out an alternative based upon dynamically growing our economy, ending the tax cuts for the rich and addressing the scourge of tax evasion and avoidance. Fourth having cleared that debris from our path we are opening up a national discussion on the reality of the roles of deficits, surpluses, long-term investment, debt and monetary policy. Fifth we will develop a coherent, concrete alternative that grows a green, sustainable, prosperous economy for all”.

John McDonnell took George Osborne straight on to quash the idea that Labour were ‘deficit deniers’, something Ed Miliband and Ed Balls got lambasted on during the general election campaign. He plans to tackle the deficit a different way.

Tackling tax avoidance
Cuts to corporate welfare
Cuts to tax breaks for buy-to-let landlords
Cuts to the tax credit bill by introducing a living wage
Cuts to the housing benefit bill by constructing hundreds of thousands of affordable homes
It all sounded good. Tackling the deficit in this regard sounds like ‘pie in the sky’ economics but John McDonnell was well aware that it is “The Economy Stupid” and without showing economic competence and an alternative to George Osborne’s austerity mantra, Labour will be doomed to another inevitable election defeat in 2020. The banking crisis cost Labour in 2010. Labour’s failure to provide a real economic alternative to the coalition government cost them in 2015.

What John McDonnell is proposing is radical.

Economic Advisory Council

“… our radicalism, it comes with a burden. We need to prove to the British people we can run the economy better than the rich elite that runs it now. That’s why today I have established an Economic Advisory Committee to advise us on the development and implementation of our economic strategy”.

This is a masterstroke. The inclusion of some of the world’s leading economic thinkers such as Joseph Stiglitz (Nobel Memorial Prize winner), Thomas Piketty, Professor Mariana Mazzucato, Simon Wren Lewis, Ann Pettifor and David Blanchflower (former member of the Bank of England Monetary Committee), will undoubtedly provide John McDonnell with some much needed credibility and nuance.

He will demand that the Office of Budget Responsibility and the Bank of England use their resources to test and re-test every policy and economic instrument to demonstrate that their policies ‘workable and affordable’. This is bold, brave and radical.

Reviewing the Treasury & Bank of England

“Institutional change has to reflect our policy change. I want us to stand back and review the major institutions that are charged with managing our economy to check that they are fit for purpose and how they can be made more effective”.

This proposal was jaw-dropping. John McDonnell has invited Lord Bob Kerslake, former head of the civil service, to bring together a team to review the operation of the Treasury. Root and branch reform of the Treasury as a whole may well be in the cards.

There is to be a debate on the mandate of the Bank of England. John McDonnell was quick to point of that it regularly fails to meet its inflation targets which needs to be addressed but yet he proposes to expand the mandate to include growth, employment and earnings. This would make it look more like the US Federal Reserve, which would it theory, open the door for his proposed ‘People’s QE’ which was absent from his speech.

The HMRC will also be reviewed. Having lost 40% of its workforce in the past ten years its role will be pivotal in John McDonnell’s crusade against tax avoidance. It will be fully resourced to maximise tax collection no doubt.

Growth & Investment

John McDonnell’s signature policy announcement is the creation of a national investment bank, which would provide long term finance for research and development, particularly in the technological sector. His objective here is to initiate what Mariana Mazzucato calls an ‘entrepreneurial state’, which sees the collaboration between the businesses, entrepreneurs and the workforce. A novel idea, but is something already used in Nordic and Baltic countries through the Nordic Investment Bank and is used to great success in Europe’s powerhouse… Germany, via the KFW Banking Group.

Are these ideas edible to the electorate? They will be if Labour can change the narrative and prove its economic competence and challenge George Osborne’s ‘long term economic plan’. We all expected a speech where John McDonnell, wrapped in a red a flag, would preach about the end of capitalism. Instead we got a cool, well delivered speech where McDonnell sounded more like a bank manager than a socialist firebrand with a real, competent economic alternative to austerity.

The limits of austerity are clear and will become clearer as this parliament progresses. The UK economy is out of kilter. Heavily reliant on rising house prices, growing personal debt, the largest trade deficit since records began and the small matter of the £1.5 trillion debt. Fertile ground for another downturn.


Meanwhile, public services are being slashed, fire sales of state assets are occurring and the most vulnerable in society are being cruelly targeted through welfare reforms. The bedroom tax, the independent living fund, housing benefit and most recently cuts to tax credits are indicative of the extremes of austerity.

The real question remains, will the masses rally around such an economic alternative? We underestimated Jeremy Corbyn, we may well underestimate John McDonnell

Power To The People

When we heard about John McDonnell’s People’s Parliament initiative, we knew we wanted to be involved. And anyone can get involved. The idea is to open up the Houses of Parliament to the people. As John sometimes says on introducing a session: everyone’s invited, except the fascists…

Illustration of John McDonnell holding anti-fascist placard

The People’s Parliament – by John McDonnell MP

We have experienced the most serious economic crisis of the capitalist system since the great crash of 1929 and yet mainstream politics has sunk to a philistine level of political debate, best characterised by the recent spoof B film party political broadcast made by the Labour Party and the succession of UKIP candidates spouting racist, homophobic bile.

How could we have let our politics become so degraded?

Three centuries ago the Enlightenment led us to believe that the exercise of reason would lead to a linear progression of how we understand the world and the society we live in. Many were convinced that this intellectual evolution would inform the political decisions taken on how best to organise our society.

Still within this tradition, Marx then introduced us to the dialectical process of history and thought.

  • Thesis and antithesis would lead to a progressive synthesis.

In our recent period, far from securing progress we seem to have gone back into the darkness. Popular political discussion, as witnessed in our mainstream media outlets, is a pretty bleak, barren wasteland. Newspapers print the sensationalist lies determined by their oligarch owners. The liberal Guardian very rarely strays beyond its acceptable establishment comfort zone.

What masquerades as political debate on radio and television on programmes such as Any Questions and Question Time is largely a parade of posturing political hacks with barely a cigarette paper between the politics of the supposed political opponents who appear on the shows.

This intellectual vacuum has led to a situation best depicted by Stan Jameson in which for most it is easier to imagine the end of the world than the end of capitalism.
Politics doesn’t have to be like this and we can’t let this continue. We have a responsibility to promote a real political discussion and debate about the lives we lead, the society we live in and the alternatives there are.

It is these sentiments that led me to launch the idea of the People’s Parliament.
Back in the 1980s I was elected as a GLC (Greater London Council) councillor and became Ken Livingstone’s deputy. Despite all the rhetoric about the Labour GLC being a golden age of radicalism, the reality is that initially the GLC controlling Labour group was fairly traditional social democratic.

Physically opening up County Hall as a building to a wide ranging array of groups and individuals, who were campaigning or promoting ideas to be implemented by the GLC, radicalised the Livingstone administration.

County Hall buzzed, with its meeting rooms packed with activists thrashing out their ideas on how to transform the lives of Londoners. Everything from fares policy to LGBT rights and securing the capital’s creative and manufacturing sectors was up for grabs.
This open democratic engagement created the radical GLC that is still remembered for its exciting creativity. It implemented policies that were seen as extreme at the time but have subsequently been accepted as mainstream common sense.

Just like County Hall, Parliament has a supply of halls and meeting rooms specifically designed for discussion and debate. The building is paid for and owned by the people and so I thought why not open up the building to the people and encourage anyone who has an idea to discuss, a policy to promote or an argument to be heard, to come along and use the building’s meeting rooms to democratic effect.

You never know, by inviting MPs and Lords to these discussions and debates might even infect some of the debates taking place in the main Commons Chamber.

From January, a group of us have organised a series of meetings in Parliament’s committee rooms, discussing a vast range of issues suggested by people who have heard about this initiative. The only bar so far is that fascists are not invited.

The mainstream media has largely ignored us but that is par for the course, and with social media we don’t really need them. The occasional plug in the Guardian doesn’t do any harm, but if we rely on this country’s press to stimulate a creative political debate we will wait forever.

Running with two sessions a week, the meetings have been packed. Having been around for quite a while I can usually recognise most of the faces in radical political meetings.

Not with the People’s Parliament.

The meetings are packing in people, especially young people, activists and campaigners who have a genuine interest in engaging with the issue being discussed and are looking for change.

The discussion of ideas and theory is important but is only really effective if it informs our political practice.

Hence the concept of praxis, the combination of theory and practice, underlines the People’s Parliament sessions.

So far the discussions have addressed questions of what sort of democracy we need, who is watching whom in our surveillance society, and what is really needed to tackle our environmental crisis.

Specialists and expert practitioners have wanted to explain what is happening in their fields of activity. Lawyers have come along to expose the undermining of access to justice, tax experts have joined us to reveal the continuing scale of tax avoidance and evasion, and housing groups have explained the grotesque failures of housing policy that have led to our worst housing crisis since the second world war.
People have brought along some of their ideas for solutions to problems. Citizens income to overcome poverty, how to reclaim the media by confronting its ownership by the rich and powerful, and constructing a sustainable economy by rejecting concepts of all-consuming growth.

Campaigners have come to seek support for their struggles. This has included campaigns against the latest wave of racism, the fight to end the Coalition’s privatisation plans to finally kill off the NHS, and the campaign to hold back legislation criminalising sex workers.

People have posed and tried to answer questions that have troubled us all. The radical publishing house Zero Books went to the heart of our search by addressing the question that underlies a large part of the People’s Parliament initiative:

how has capitalism got away with the financial crisis and why is politics scared of political ideas?

The next stage of the People’s Parliament discussions is looking at;

how we learn from the resistance to the capitalist crisis so far, to enable us to move beyond capitalism.

Each of our sessions have been introduced by experts and campaigners within their particular policy area but the discussion is dominated by the participants who turn up. Most of the debates have led to agreements on further action.

A thread running through the sequence of the People’s Parliament sessions has been that words are not enough.

The elite who still dine at the Ritz, shop at Fortnum and Masons and who populate the company boards in the City of London will remain content whilst our talk remains only talk.

They will only be fearful when our talk moves on to action and they know that our direct action only becomes effective when it is armed with an understanding of our society and its potential alternatives.

The People’s Parliament attempts to make its contribution to arming that resistance. Come along.

John McDonnell is the MP for Hayes and Harlington, and the last communist in Parliament.

Jul-Aug 2014 - Pages 18 & 19