It’s Friday 5th July last year. The Tories have just been swept from power, crashing to a mere 121 seats, the lowest tally in the party’s history. Labour has a 170-seat majority. The Labour government looks firmly in charge.
Where are we today? Labour’s vote share, as seen in polls, is hovering around the mid-20s.
What has caused this fall from grace? Dumb choices have meant that Labour has contrived to increase public expenditure, raise taxes and kill growth.
Straight out of the traps, Labour brought in sweetheart deals with the unions. Train drivers, for instance, were to get an eye popping 14 per cent rise over 3 years.
These deals were well above the inflation rate which was below 2.5 per cent the month Labour won the election.
The Labour Party then had to find a way to pay for their generosity to their union masters.
They announced that they would get rid of the winter fuel payments to pensioners. The next major fiscal announcement was, of course, the budget.
Reeves announced an eye-watering £40bn of tax rises. Most of these hikes fell disproportionately on business and wealth creators, farmers, small businessmen and employers of all kinds.
Indeed, £25bn of these tax rises would come from increasing employer’s National Insurance contributions.
This increase has had a terrible effect on business. Hiring of employees has halted. Wage increases have stalled.
It’s not surprising that our economy grew a pathetic 0.1 per cent in the last quarter of last year. To the socialist mindset, business is simply a milch cow to be milked at every opportunity. There are no incentives to invest or create new business.
It’s fashionable to blame individuals. Rachel Reeves is getting heat for all these disastrous moves. The reality is that number 10 is the orchestrator of this policy.
Left wing student politics is in the Prime Minister’s DNA. If he is foolish enough to replace her, he will have signed his own political death warrant.
Kwasi Kwarteng predicts Reeves will go after taxes againPAThe truth is that it is the Labour Party not Rachel Reeves alone who are committed to this disastrous course of tax and spend.
Poor growth where tax receipts cannot cover an engorged public expenditure mean the government has three options .
Firstly, Reeves can borrow more money. She has repeatedly ruled this out. It would break her fiscal rules . This is unlikely .
The second option would be to reduce public spending. This, frankly, is the least likely if the three options. A Labour Party that screamed about so called austerity whenever Tory governments had the temerity to talk tough on spending will not countenance spending restraint.
The Tories talked a tough game but did nothing actually to reduce public spending. Labour cut benefits? How likely is that? The left would go into meltdown and the Labour Party would effectively be split in two .
The last remaining alternative is the most damaging. More tax rises could tip an already fragile economy into recession. They will certainly create an atmosphere even less conducive to investment and enterprise .
Tax rises will appeal to the cruder instincts of the Labour left. Denis Healey, a Labour chancellor in the 1970s, promised to squeeze the rich until the “pips squeaked”. Labour’s slogan, “For the many, not the few” is the cry of socialists everywhere who want to wage class war against wealth creators. The left is dying to impose huge tax hikes on the “rich”.
Herein lies madness, the history of Venezuela, Cuba and the Soviet Union bear witness to the wretched state to which socialism always leads.
A version of this fate, mixed with the ever - present dose of mass migration could well be the fate of a once great nation under four more years of this Labour government.
