The Strategic State

Jeremy Corbyn writes:

To succeed, we need to build shared economic growth.

This government is failing to reform the economy, and hoping that the same failed economic neglect that led to the crash will somehow lead to a different result this time.

We need a strategic state, not an absentee government. This absence is producing yawning inequality, which the OECD says is stunting our growth. 

In November, the chancellor will set out his comprehensive spending review to close the deficit within five years. 

Five years ago, in June 2010, he set out an emergency budget to close the deficit within five years.

Parliament can feel like living in a time warp at the best of times, but this government is not just replaying 2010, but taking us back to 1979: ideologically committed to rolling back the state, attacking workers’ rights and trade union protection, selling off public assets and extending the sell-off to social housing. 

This agenda militates against everything the chancellor says he wants to achieve. 

If you want to revive manufacturing and rebalance the economy then you need a strategic state leading the way, which is why we have proposed a national investment bank. 

A national investment bank can invest to provide us with the foundations of shared and ecologically sustainable growth: renewing the UK’s energy, digital and transport infrastructure which lags woefully behind other major economies. 

If we are going to tackle the housing crisis that is resulting in the social cleansing of more and more of our towns, preventing young adults from being able to buy, then we need to allow councils to borrow to build the homes their communities need, and to regulate rents. 

We need a national strategy to rebuild the skills base of the construction industry. 

As long as this government’s only strategy is to inflate house prices then the crisis will continue until the bubble bursts with the trauma that will bring to families and our economy. 

If you want a more productive economy, you need to invest in the skills of our workforce. 

Instead the adult skills budget has been cut by 40% since 2010, and further education funding is in crisis. The CBI says the UK has “a skills emergency now, threatening to starve economic growth”. 

That’s why we have proposed a national education service – for lifelong learning, from universal free childcare to skills training throughout our working lives – giving more people access to work and access to the tools they need to succeed. 

And if you genuinely want wages to rise, and for those increases to be sustained even if inflation rises, then you need stronger trade unions in more workplaces as research by Professors Wilkinson and Pickett has shown. 

That’s why under my leadership, Labour will provide robust opposition to the trade union bill, which will put our country, already in breach of ILO conventions, even further out of step with the global consensus.

A more productive economy in the long term will bring us higher tax revenues, but that requires long-term investment in infrastructure and the skills necessary to grow a balanced economy. 

The UK is mired in a productivity crisis, lagging nearly 30% behind France, Germany and the US. We need a Labour government in 2020, but we cannot wait until then. 

Labour has to be a strong and constructive opposition in the next five years. If we can win the argument in the country, then perhaps we can force this government to change course.

Our opposition cannot be limited to the parliamentary chambers and TV studios of Westminster.

Labour is best when it is a movement, and that movement has swelled to an enthusiastic 600,000 who will decide this leadership election.

Once that is over, we face a bigger task: to force this government to abandon its free-market dogma and become the strategic state our society needs. 

That challenge begins on 12 September.