Industrial Strategy: May government needs to match it's words with public investment if it wants to unlock missions potential

When Theresa May took over the leadership of the Conservative Party, she heralded a change of approach. There has been a lot of talk of government being willing to get more involved - on May's part, expressed in her insistence on restoring the Unionist part of the party's legacy, including invoking Joseph Chamberlain and a more activist government.

The issuing of an industrial strategy was seen as a statement of intent - an act of intervention that broke with the pro-business, laissez faire brand of 'liberal conservatism' of her predecessors David Cameron and George Osborne.

However, follow through has been limited. So too has money. Once published, the government's strategy looked less about shaping markets and supporting innovators, and more about propping up Britain's failing industries with deals and deregulation.

Theresa May's latest step was to reference the UCL Institute for Innovation and Public Purpose (IPPR), who along with it's director Mariana Mazzucato have been pressing hard for a reshaping of how we understand the role of government in innovation. But her warm words toward the potential of strategic missions will mean nothing without the funding to match.

Mazzucato's work has argued, the state can be the risk taking pioneer - a role expected of the private sector, but which it is never willing to fulfil. By funding R&D, by offering long term, stable public investment, government can open up and shape entirely new markets.

But it can't do this without money - at either end. Projects need investment and support to be there from the start and need the private sector not be able to simply walk away with unlimited potential earnings at the end, with no restitution for the public role. Big ideas should fund new big ideas.

Theresa May's government, however, has yet to be willing to match big words with big funding. Today's speech was no different. There was a lot of praise for public institutions that engage in research, but little mention for how they have been strangled of funding.

May set out her four missions - within four 'grand challenges' facing Britain taken from the Industrial Strategy - and praised the potential of missions to drive innovation forward. But that was the extent of it.

Both the IPPR and the thinktank OECD have argued that increased public investment, and the infrastructure to implement it like a National Investment Bank, is a golden opportunity that the UK is not taking advantage of - despite Britain investing well below 3% of GDP.

Without funding, potential will remain unexplored. Mission statements represent step one in a coordinated approach. The Prime Minister herself acknowledged that progress is born from collaboration and cooperation. There needs to be a lot more of it, and something more: coordination.

Theresa May is committing to the big visions/big speeches aspect of the call for strategic thinking. Will the government wake up and start to put in place the rest of the infrastructure needed to maximise the potential that can be unlocked by long term strategic thinking?

Labour policies are popular, but party must still win back confidence on economy

Labour policies are popular and Corbyn is no hindrance to that, but the party must still win back public confidence on the economy if it is to mount serious opposition, let alone return to government.

With the local elections coming up, the Labour Party has made use of the Easter break to make a series of policy announcements in an effort to take back control over its image. Under Jeremy Corbyn's leadership, a hostile relationship with the media has made it hard for the party to put across what it stands for to the public.

The way Corbyn has chosen to try and cut through to the public has been to roll out a few major promises. The party has pledged to deliver a £10 minimum wage, universal free school meals and raise standards for the £200 billion the government, central and local, spends on commissioning and procurement in the private sector (Eaton, 2017; Ashmore, 2017).

Yet, if Corbyn is going to breakthrough and recover public confidence in the Labour Party, damaged long before he became leader, he has one main task: he must win the argument on the economy. His problem is the party remain divided on whether that means regaining trust as the credible stewards of the neoliberal economy, or to change minds and develop something new.

The policies Labour proposed have been, on the whole, welcomed by the Centre-Left press (Eaton, 2017; Slawson, 2017; Lister, 2017) and a ComRes poll showed that Labour's Easter announcements were very popular - even when people knew they were Corbyn's policies (Cowburn, 2017). All around, two weeks used well by the party.

However, the poll also highlighted something important. When asked how they regarded the longer standing Labour plans for a National Investment Bank, funded to the tune of £350 billion by the treasury, the response was much more unsure. Herein lies a problem that speaks to the absolute crux of the dispute between the factions within the Labour Party.

The austerity narrative, sown deeply into the public consciousness by the Conservatives after they came to power in 2010, has firmly established the idea that money is short. Further, the Tories pushed hard to make a link between the shortage and Labour's spending in government.

That narrative created a presentation problem for Labour. Whenever Labour pitches a policy that involves spending, they play right into a Right-wing narrative of frivolous profligate - as seen by Theresa May responding to Corbyn's policy pitches with her standard line that Labour will 'bankrupt Britain' (Eaton, 2017).

To this point, Labour hasn't helped itself. In the past five years the party has veered between doubling down on meeting Tory policy pledges, point for point and pound for pound even when it comes to cuts, to promising big uncosted spending - or criticising the Tories for underspending without a costed alternative.

For instance, while the £10 minimum wage will only be a pound more what the Tories will be offering come 2020, there was no breakdown as to how the increased costs would be handled. There will be more pressure on the community & voluntary sector, on social care that is already stretched and on small businesses and low pay employers, to name but a few.

Will there be increased spending to further fund the social sector to cover the costs? Will there be tax cuts for business to protect low-paid work? Where will the money be found to fund these? From increased taxes on the rich that the party has been criticised for mentioning in connection with a whole range of spending proposals?

These questions need to be asked, because at present the collective public consciousness still appears to accept the core of the austerity narrative on economics: that government money is limited, that a government siphons from society when it spends, and that borrowing is a reckless alternative.

And yet, the argument for austerity is weakening. Every day some new story emerges that exposes a little more of its cruel impact - and that impact is starting to be felt by the middle class and not just the poorest. Ahead of the Labour Party is a choice and its different factions need to unite behind one or the other.

To remain hitched to neoliberalism as well-meaning and trusted stewards or to fight for a new narrative that isn't shaped by the Right-wing press. Either way, it is a fight it must win - because while the ComRes poll from the weekend suggests that Corbyn is not the problem he has been cast as, Labour still sit 21 points behind the Conservatives (The Independent, 2017).

There are people searching fora working opposition and, right now, Labour is the second largest party. A progressive movement cannot function without them. Labour doesn't have to do it alone, but as the loudest voice it must start making itself heard - and start setting the tone of economic debate.

The Budget: Hammond's budget all about tweaks - spending headlines mostly in the millions rather than the billions

Philip Hammond delivered his first budget today. Photograph: NATO Summit Wales 2014 by the Foreign and Commonwealth Office (License) (Cropped)

Philip Hammond looked relaxed, even made jokes, as he delivered his first - and apparently Britain's last - Spring Budget. The Chancellor's budget was one tweaks, all framed as adjustments to increase fairness. He began by summarising current economic trends, noting the highest number of women in employment ever. Growth projections are up slightly, but a projected drop in borrowing is only short term.

The long term economic plan of his predecessor George Osborne, to eliminate the deficit and produce a surplus to whittle away the national debt, was much delayed. Its aims where pushed back again by Hammond today. The promised fiscal surplus now not likely be seen until a long way into the 2020s - at least.

As for spending, the numbers he was pitching were all notably in the millions rather than the billions. £200 million for school repairs. £100 million for A&Es. A few hundred million for devolved administrations. £700m for councils to tackle urban congestion. The one exception appeared to £2 billion for Social Care - yet that was immediately qualified as being spread over three years.

Those spending commitments were companied by big companies seeing Corporation Tax fall again, as planned, to 17%. Perhaps as a counter to the criticism Conservatives have faced for their tax cuts for those at the top end, Hammond did however announce a halving of Director-shareholders' tax-free dividend allowance - noting it as a very generous tax break for investors.

For income taxes and wages that affect the overwhelming majority of people, the Personal Income Tax Allowance and the National Living Wage will both increase, to £11,500 and £7.50 respectively. The Universal Credit taper rate will also be reduced from 65% to 63% for earnings over allowances. Yet the overall positive impact of these is likely to be slim.

It is not surprising then that Jeremy Corbyn attacked the Chancellor's budget as one of "utter complacency". Corbyn painted a picture of people in precarious work - unsure of where they'll find work or what money they may make tomorrow, queueing at food banks and one of a million working households getting housing benefit because working pay doesn't cover the rent - for whom there were few measures.

The Labour leader expressed anger that public servants have still seen no pay rise in seven years, due to the Government's freeze on pay, and that no funding security has been given to the NHS despite there being an obvious crisis, despite the fact that corporations are still going to get their year on year tax cut.

The Chancellor's budget has offered only a range of small spending increases, in a very concise series of measures, and it is hard to see them as sufficient. Analysts, such as Kamal Ahmed at the BBC, have characterised the budget as representing 'pain delayed' - taking advantage of the short term boost that Government finances are experiencing this year.

This is not the start of a public investment led drive to build a path out of austerity. With the debt and deficit still hanging heavily over Britain, these feel like stop-gap measures to assuage certain political pressures in the present, and to ease the way to the further austerity that waits ahead.

Budget Preview: Will Hammond act to end Conservative pattern of money being redistributed away from most vulnerable?

With the National Debt is still rising, will the Chancellor be able or willing to find some money to invest in essential services? Photograph: Pound Coins from Pixabay (License) (Cropped)

Philip Hammond faces his first budget as Chancellor on Wednesday and he has a lot of pressure to handle. The overall Conservative promise to alleviate the country's debt is still a long way from started and there are spending decisions that Hammond will find it difficult to avoid addressing.

Funding plans for Schools, Social Care and Personal Independence Payments (PIPs) all indicate a troubling pattern of money being redistributed away from the poorest and most vulnerable areas that need it most - not an image that Theresa May, if she is to keep her promise of a Britain that works for everyone, will want to reinforce.

Schools, even those under financial pressure, face up to 3% in budget cuts. Social Care has seen billions cut from the system. And, Theresa May's government is trying to wriggle out of coughing up more money to cover a court-ordered expansion of the PIPs welfare programme.

How the Chancellor addresses these concerns is important. He has already done the press rounds in the past week to assert there will be no big spending and rolled out, the now standard Tory line, that problems are less the result of low funding and more of not following 'best practice' (BBC, 2017). But will that line be maintained through Wednesday?

On Schools, Hammond faces a situation that will be hard to explain away. The government announced plans for a new funding formula in December, that came with the less than reassuring 'assurance' that no school would lose out by more than 3% (Weale, 2016).

That is hardly going to offer succour to schools in poorer areas. As Andy Burnham (Bean, 2017), Labour nominee for Mayor of Greater Manchester, asked the Prime Minister in the Commons: how does the Prime Minister expect to get more working class children to university by cutting schools funding across the North West?

Meanwhile, Social Care has become the particular Tory baggage with which to pummel the government. With £4.6 billion in cuts since 2010 and shortfall predicted (Full Fact, 2016), it is about the hardest area for the government to argue that funding cuts don't make a difference.

In fact, the previous Chancellor George Osborne did begin to respond - but only with an, at best modest, increase in funding, that was planned to come in with this budget, but would only raise around £200 million nationally (Merrick, 2016; BBC, 2016).

The plan also does not actually involve a boost in cash from the government itself, but rather put it onto local councils to raise more in tax - up to 2% extra. However, the one, and particular poignant, flaw in this approach is that wealthier areas will be able to raise more for themselves than the poorest and most vulnerable who need it most.

Across Schools and Social Care, there is a very clear pattern emerging of money being withdrawn from where it is needed most to make tax savings for those from wealthier areas - simply, regressive economics.

That pattern is reinforced in the government's insistence upon not spending the extra £3.7 billion that an expansion of Personal Independence Payments, ordered by the courts, would call for across four years (BBC, 2017{2}) - less than a billion a year to take care of people primarily with mental health problems.

An aide to Theresa May was heavily criticised for his callous remark that funding need to kept to only the "really disabled" (BBC, 2017{3}) - for which he later apologised - but it summed up the Conservative attitude.

Under Conservative government, the services people depend upon in their everyday lives are being squeezed. Money is being siphoned out programmes that serve the most vulnerable and leaving them to find ways to fend for themselves - whether they're young, old or disabled.

There are rumours that the Chancellor will respond with a little more money than is currently planned (Kuenssberg, 2017). However, a lot more investment is needed to convince anyone that the government is moved by a real comprehension of the difficulties people actually face when the public services they rely on are disappearing.

Chancellor quietly drops yet another target, but Labour infighting means chance to pitch positive alternative case will be missed

Under Chancellor George Osborne's stewardship, the Treasury is going to miss another of its fiscal targets. Photograph: Pound Coins from Pixabay (License) (Cropped)

On Friday, at the quiet end of the week and under the cover of the Labour and Conservative leadership wrangling, Chancellor George Osborne announced that he was relaxing the fiscal rules demanding that the government deliver a budget surplus by 2020 (Ahmed, 2016).

Paul Johnson of the Institute of Fiscal Studies immediately stressed that the measure, though it would allow for more borrowing and so less spending cuts or tax rises to cover the shortfall caused by the post-Brexit downturn, would not mean the end of austerity (BBC, 2016).

On Sunday that was confirmed when the Chancellor announced his intention to further accelerate the reduction of the Corporation Tax rate down to a new low of just 15% (Monaghan, 2016) -  a move entirely consistent with Chancellor's M.O. of managing the economy by creating seductive conditions for major firms.

With targets being quietly missed and dropped, and sweetened tax deals for major corporations being announced, it is disappointing that Labour MPs are too busy completely embroiled in their own mess to take the opportunity for a big public 'We Told You So'.

Labour are also in no position at present to step up the argument for seizing this opportunity to push for the much needed public investment plan that Shadow Chancellor John McDonnell has argued the Chancellor's fiscal rule did not allow for (Treanor & Allen, 2016).

While the first announcement was buried beneath other news on a Friday, where missed targets are often hidden, it was a move that brought the policies of Osborne and Tory leadership candidate Theresa May into alignment - as May said in her campaign announcement that she would put aside the aim to get a surplus by 2020 so as to avoid disruptive tax rises (The Independent, 2016).

While suspending the fiscal rule aligns with May's position, the decision to cut Corporation Tax may have a more complicated effect on the Tory leadership contest. Brexiter candidates have been keen to downplay the negative economic impact of the vote to leave and will seize upon any sign that life goes on as usual.

The Chancellor using the new freedom for a tax cut rather than as the first in a package of measures that include the rise in taxes that he previously warned might follow a vote to leave, could play into the hands of the Brexiter candidates. The idea that Britain still has room to manoeuvre, to make a pitch to international businesses that it is still a place to invest, will likely embolden Brexiters who accused the Remain camp of 'Project Fear'.

However, the reality is that public revenue in the UK is already tight and suspending fiscal rule only confirms the fact. Public spending is still in deficit and key benefactors like the NHS still suffer from shortfalls. Abandoning the rule means an admission by the government that only by borrowing more can it now keep up with spending demands - for now.

The big question remains as to whether borrowing, for public investment, or limiting and even eliminating borrowing, cutting public outlays and seeking private investment to cover instead - ie austerity, represents the sounder fiscal policy. Which will help produce growth and revenue?

From the OECD to the IMF (Elliott, 2016; Summers, 2014), the argument that the UK needs to borrow and increase public investment, because boosting public investment can drive the growth that delivers the tax receipts (Stewart & Asthana, 2016), has strong support. The economists who have joined John McDonnell on his New Economics tour have also made broadly the same case.

The argument from the Left is that the Chancellor's focus is on entirely the wrong part of the economy with his tax cuts, benefiting the richest in the hope that they see past their short-termist to invest with a longer view (Sikka, 2016). They also warn against the short term focus of austerity, which looks for gains by selling off parts of the government to would be rentiers, as flawed and likely to only increase problems in the longer run (Mazzucato, 2016).

The alternative is to instead start directing investment into ordinary people - whether that be through education, in skills through apprenticeships and training, through jobs repairing roads and other transport infrastructure or building thousands of much needed new homes - with every penny spent multiplying in value as it boosts the economy.

These are all long term projects, aimed at providing a stable and prosperous future. A progressive economic alternative needs to do more - from reforming welfare towards a compassionate Basic Income and improving workers' say and stake in the work they do - but public investment is the starting point.

The Chancellor has taken a step back but the pressures of austerity are not yet relieved. Progressives have to overcome their divisions so they can start building the arguments for a more prosperous future with the common good at its heart.

Budget 2016 Preview: Will the Chancellor again produce an ace in the hole that lets him to put off unpopular cuts?

George Osborne's Autumn Budget Statement promised the UK a bright future. Osborne took the chance offered by predictions of an economy looking more healthy to be a little less conservative with the national finances and drop controversial cuts to the police budget and to tax credits (ITV, 2015).

This time around Osborne is warning of dark clouds and the need to prepare for the worst (BBC, 2016). The Chancellor has been at pains to stress that there will be cuts in order to meet his fiscal targets. There might be some sugar coatings, but the medicine is still predicted to be sour.

However, the Chancellor will surely be hoping to be able, once again, to defy all expectations and match his Autumn reprieves. Yet those reprieves were themselves only temporary. They could only be delays of self-imposed hard choices that Osborne had undertaken to make.

Theresa May stressed that the police would still be expected to find efficiency savings (Travis, 2015) and the dropping of Tax Credit cuts were a diversion, as they were still set to come in later with the Universal Credit (Kuenssberg, 2015). They were also a gamble.

Osborne's Autumn Statement took positive forecasts as an opportunity to not make the unpopular choices, while still working on closing the deficit - betting on the forecasts panning out and with slight tax increases, around the fringes. Attempts were also made to temporarily ease the way for the middle class with the Conservatives' colourfully branded array of saving and house buying assistance - that buys time for much delayed house building (Wright, 2016) by siphoning homes from housing associations, depended on by the least well off, to increase competition in the private markets.

Wednesday's budget might reasonably be expected, by the opposition, to be the overdue reality check for those who voted Conservative last May, with the implementation of all of the delayed austerity measures. All of Osborne's public comments certainly seem to be preparing the ground for the further cuts - 50p in every £100 of government spending as he put it to Andrew Marr on Sunday (BBC, 2016).

Yet its hard to ever be too sure what the Chancellor is planning. Osborne managed expectations in the Autumn towards his plans for cuts to tax credits (Kuenssberg et al, 2015). Yet when the time came, he still found a way to avoid what would have proven a deeply unpopular cut.

This time around, with so much riding on the EU referendum including his own chances of succeeding Cameron as Conservative leader, Osborne is again unlikely to go antagonising voters if it can be avoided. Yet time is undeniably running out to meet his own deadline for eliminating the deficit (Verity, 2016), and small shifts in forecasts could lead to the need for drastically larger cuts to meet those goals.

Hints being dropped about new policies, to be announced on Wednesday, at the least suggest a wish to dampen the impact of announcing cuts. Yet the proposed new savings top-up scheme for the least well off seems to be little but a thin veneer (Mason, 2016) - as it's only likely to help a sixth of those who are supposed to be eligible, with Labour criticising the policy for its unrealistic appraisal of what people can actually afford to save.

Across the floor, Labour's Shadow Chancellor John McDonnell has said he wants to see more investment (BBC, 2016{2}) - putting money into building up domestic industry as a way to rebalance the economy. McDonnell's advisors, like Mazzucato and Stiglitz, have certainly been making the argument that the state has a role to play in rebuilding the economy.

It is certainly hard to see a way forward without a lot of investment from somewhere. Osborne's own hope has been for investment in Britain to come from 'emerging markets', like India and particularly China (The Economist, 2015). For these private and foreign state investments to take the slack and pump money into sectors of the UK economy and infrastructure, according to market needs, so that the Chancellor can cut government spending.

Considering that, while defending the European Union, Osborne argued it was the UK, not the EU, that was responsible for the 'red tape' that puts off investment (Bloom, 2016) - and the Chancellor's desire to stimulate these private and foreign state investments - it might not be a long shot to suggest some sort of deregulation will be included in the budget. It would certainly offer some 'efficiency' cuts in terms of reduced bureaucracy.

If George Osborne has an ace up his sleeve, he has yet to let slip what it will be. The implementation of the National Living Wage (a higher minimum wage for over 25s), very limited savings assistance and the regular increase in the Personal Income Tax Allowance (introduced by the Liberal Democrats), do not amount to much of an offset to the expected large departmental cuts.

Will the Chancellor play some hidden card, or will the full weight of his targets finally begin to fall? He doesn't have much room for manoeuvre. His fiscal deadline is approaching, neither deficit nor debt are under control and his own outlook sees global economic struggles. And yet, after so many other sleights of hand, it would be foolish to rule out the possibility of one more gamble.

Labour need to start winning battles on the airwaves if their anti-austerity policies are going to win on the ground

At some point John McDonnell has to turn his academic focussed New Economics tour into well publicised campaign events, for audiences both live in the flesh and live online, if his counter-narrative is going to take hold. Photograph: John McDonnell MP with Grow Heathrow in London in 2012, by Jonathan Goldberg/Transition Heathrow (License) (Cropped)

Yesterday evening, Labour Shadow Chancellor John McDonnell made the latest stop on his New Economics tour at the London School of Economics (Kirton, 2016). As with previous events, the audience was packed out to hear his arguments, not just against austerity but for an alternative.

The first New Economics tour stop saw Mariana Mazzucato argue, at the Royal Society, for a smarter state (Mazzucato, 2016) - defending the state as an often abused innovator that takes the risks that the private sector won't, but which shares little of the rewards. The second saw several speakers tackle how technology will affect work in the future (Srnicek et al, 2016).

At the LSE event, McDonnell spoke directly against austerity as an ideologically motivated policy - as a choice made by Conservative politicians in pursuit of a their own political goals (Kirton, 2016). The Labour Shadow Chancellor said that his priorities were to put democracy and decentralisation at the heart of his economic approach (Sheffield, 2016) - and positive statements that Labour were giving serious consideration to backing a basic income (Sheffield, 2016{2}).

What has been missing, however, is promotion. Beyond those in the loop or paying close attention, there has been little pomp and ceremony to draw attention to the Shadow Chancellor's efforts. In the face of apparent media hostility to the Corbyn-McDonnell project, the low key approach might well be understandable.

The trouble is that these are precisely the battles that Ed Miliband lost as Labour leader. Labour lost control of their own message, of their own identity, and left it to others to define them.

Economics has been the outstanding issue. The key to getting Labour back in power, according to many commentators both internal and external over the last six years (Umunna, 2015; Eaton, 2015), is to rebuild Labour's reputation as an effective and reliable manager of the economy - to regain their economic credibility. The Shadow Chancellor himself has acknowledged that reality (The Herald Scotland, 2016).

John McDonnell's idea of bringing on the world's most famous, rockstar, anti-austerity economists as advisors was a bold move. Taking them on tour to make their arguments, to build a counter-narrative in opposition to austerity, was bolder still. But the low key, low profile, approach can only reach so far.

Right now, the Corbyn-McDonnell team is fighting battles within small circles of onlookers. Scrapping for party policy positions, introducing an alternative narrative by increments to interested and sympathetic audiences at cosy events. Yet, sooner or later, the boots of campaigners will have to hit the ground and bring them face to face with the voters who live far outside of those circles.

The Corbyn-McDonnell team have shown that, within their own party, they have a pitch that appeals to a broad cross-section of society - from young to old, from poor to wealthy (Sayers, 2016). As with Bernie Sanders in the United States, there is the potential for a winning coalition. But that won't automatically translate into public sympathy.

To reach those people, New Economics will have to start winning battles on the airwaves. Promotional ideas like the New Economics tour will have to be prepared to put a spotlight on its rockstars, promote them and get them playing to bigger crowds - crowds that are maybe more sceptical and who need the grand ideas distilled and condensed.

John McDonnell and his advisors are presenting a compelling vision of a very different, more humane, economy and society - not least in their acknowledgement of the basic income. The next step is to turn up the volume and stop conceding control over the airwaves.

Politics and the Environment in the Age of Political Economy

Big promises have been made on climate change in Paris. Yet it seems that economics has had the last word. Photograph: Paris 2015 #COP21 @CMP11 by Ron Mader (License) (Set on white)

The 2015 United Nations Climate Change Conference, or COP 21 (the 21st Conference of the Parties), was the perfect summary of the age of political economics. All of the show and all of the image of action, without much in the way of tangible results.

Seemingly heeding, finally, the repeated warnings about the dire long term effects of failing to address fossil fuel use and climate change, and the deadly outcomes of delay, world leaders have declared an agreement to bring to an end the era of fossil fuels (Goldenberg et al, 2015).

The agreement that comes out of COP 21 makes a lot of promises. It has pledges, long term goals, and regular assessments of progress (Vaughan, 2015). And yet, in true political fashion, these promises come without immediate action and with a number of caveats.

For one, there is some substantial shifting of responsibilities. There is a clause that assures that countries hit by the more extreme weather and rising water levels, produced by global warming, cannot make financial claims against those who have been, and continue to be, users of fossil fuels and big polluters of the environment.

The commitments made are also fairly vague (Monbiot, 2015). A commitment to achieve the global peak use of fossil fuels 'soon', came with not a date in sight. A commitment to a maximum 1.5C of global warming, was without a defined plan and method for achieving it.

And, even as these kinds of agreements are made, they are being made a mockery of by the politics of the day. The reality is that countries like the UK - even as the government welcomes the deal (Whale, 2015) - continue to use fossil fuels, and even to expand their usage (Monbiot, 2014), in pursuit of their economic aims.

In the age of political economy - where the whys and hows have, in all provinces, been subsumed beneath and sacrificed to 'economic efficiency' - attempts to prevent environmental disaster are given a back seat to economics. We must first stabilise the economy, they say, only then can we look to the esoteric concerns of healthcare, welfare and, of course, the environment.

Yet this response is irrational. It excludes facts to create a self-defined box within which political solutions can meet arbitrary targets. A boxed-context, designed to allow an economic solution to be a 'success', on its own terms, to save one party's flagging economic policy and so its political future.

However, none of the problems facing society can be handled piecemeal. All of it is connected and impacts upon the others. If a comprehensive green energy programme is not part of the economic response, that response is no solution. Ignoring or denying facts will not change them.

In the age of political economy, where every decision is hemmed in by a thousand financial interests - each likely to lose out as another gains - comprehensive, holistic programmes are hard to come by. Yet one is needed.

As the French regional elections demonstrated, the old establishment that has held sway in Europe is teetering. Renewing politics means finding a way to break out of the age of political economy where politics has become a world of promises that can be fulfilled only within arbitrary contexts using perceived truths and half-facts.

Without a comprehensive progressive alternative, the discredited system may fall into the hands of extremists with narrow sectarian viewpoints, who will be unlikely to have the breadth of vision necessary to deal with the grave matters, even the climate issues alone, that threaten the future (Lucas, 2015).

Oldham will be the first preview of who is winning the political battles in the public eye

Oldham will host the first by-election of this parliament, triggered by the death of Labour MP Michael Meacher. It will be a set piece political event that might just offer some small insights into whether party ideas are capturing the public imagination. Photograph: Oldham Town Hall by Mikey (License) (Cropped)

On Wednesday the Conservative fiscal plan for the next four and a half years was laid out by the Chancellor. Complete with politically considered back tracks and U-turns, George Osborne's spending review laid out the cuts, caps, and the phasing out and shifting of burdens that we should expect.

Yet, even with all of this information now on the table, the question of how to oppose the Conservative approach is putting Labour in a bind. Labour are trying, though not too hard, to avoid fall into a civil war - the result of which would almost be that the New Labour faction would be forced to leave the party and could even taking a majority of Jeremy Corbyn's party MPs with them.

These events are all very poignantly timed, as the first test for all sides - an important trial run, almost - is coming on the 3rd December in the form of the Oldham West and Royton by-election. From its result, it will be admittedly difficult to extrapolate anything particularly substantial.

Not until April, and the National Assembly and London Mayoral elections will we see a full appraisal of the response of the country to the election of a Conservative majority, its policies on human rights and austerity, and Jeremy Corbyn's new approach as leader of the Labour Party. Yet next Thursday's by-election might just provide a small preview.

Voters in Oldham will be the first to pass direct comment on what was, effectively, Osborne's third budget of the year. Those that turn out at the polls for the by-election will get a chance to say what they think of the Chancellor's offerings.

Despite the fact that the focus for most people will be on the headline of Osborne's likely-to-be-popular U-turn on Tax Credits (BBC, 2015) - and the U-turn on cuts to police budgets that he tried to pass off as a Labour idea - there were other policies to be found in the spending review.

These policies include the gradual phasing out of tax credits, to be replaced with the less supportive universal credit (Allen et al, 2015); a new cap on housing benefit (Cross, 2015); and the replacement of grants for student nurses with loans (Sims, 2015).

According to the assessment by the independent Institute of Fiscal Studies (IFS), the poorest will be the most heavily impacted by these changes (Allen et al, 2015) - although that is disputed by Conservatives. Critics have also been sure to point out that austerity is far from over (Wearden, 2015). Further cuts or tax rises may even be necessary if Osborne's gamble on the OBR's positive outlook fails to pay off (Peston, 2015).

Osborne's domestic reforms also appear to match the ideas in his recent speech laying out his plan for the European Union - another issue that may well be on voters' minds. For the Conservatives, the aim is clearly for a deregulated EU that is for business (Sparrow, 2015), rather than citizens - reserving free movement only for trade and money.

Leading the progressive opposition at this point should be the Labour Party. However, Jeremy Corbyn's opposition to intervention in Syria (Wintour, 2015), at least in the present terms and under the present conditions, is proving to be just the latest opportunity for a divide to open up between Corbyn, along with his supporters, and the party's mainstream - particularly in the parliamentary party.

It doesn't seem to be helping to quell the dissent of the few - at the moment, at least - in the Labour Party who support intervention, that even Conservative commentators are saying that the UK's most powerful role right now may well be diplomatic rather than military (Davis, 2015).

There is also the likelihood of a hugely significant event on Tuesday, just days before the by-election, when NHS doctors go on strike, to be followed by two more days of action later in December, if renewed negotiations do not achieve enough ground (Tran, 2015).

Politically, ideologically, there is a lot of pressure building. Yet it won't all be about objective analysis of the impact of policies. Politics is also a contest over the popular perception fought in, and often with, the media. In that game, the Conservatives have tended to fare best, and Osborne has managed to make all of the headlines about how he is protecting, for now at least, those already in the system.

What it is essential for progressives to get across, and rally support behind, is that this is something the Chancellor has only achieved through the shifting of burdens and letting new entrants be hit by the deepest cutbacks (Allen et al, 2015, Cross, 2015). Yet it is always difficult to make heard the narrative based on those who will be hurt in theory, when up against a narrative of those will not now be hurt in the present.

As for other progressive opposition parties, like the Greens and the Liberal Democrats, they will just want to be heard and to see a decent turnout. They both risk being drowned out by the larger narratives coalescing around the two big parties, yet there is room for them to still make an impact. For the Greens, the UN climate change summit in Paris puts the environment and clean energy in the public eye (Vaughan, 2015), while the Lib Dems have been vocal in their opposition to the government over human rights and the rights of refugees (Riley-Smith, 2015) - a key pillar in their plan for a 'Lib Dem Fightback'.

However, set piece events like Thursday's by-election only offer a snapshot impression of where the different factions and parties are, relative to each other, and who is hearing the message sent out by who. The big question - which will likely only be answered in subtle shades of grey - will be whether Osborne has succeeded in getting out the message he wants heard, and whether Corbyn's approach can produce in terms of practical results.

Autumn Statement: Osborne's spending review takes risks & makes U-turns to dodge political storms - but only in the short term

George Osborne wants to be seen as a builder and as a friend to workers. Lower borrowing costs allow him to cut less this time around and tax rises offer more apprenticeships, yet it all rests on a series of gambles. Photograph: The Chancellor with guests at Port of Tilbury on 1 April 2014 by HM Treasury (License) (Cropped)

This was expected to be an announcement of ever deeper cuts than ever before, with £20bn needed to keep on course with Conservative fiscal targets (Kuenssberg et al, 2015). With George Osborne as Chancellor, however, it was never quite possible to be too sure.

The big unexpected move this time around was the Chancellor's decision to drop the proposed cuts to tax credits (Robinson, 2015). Announcing a better than expected fiscal situation, and saying he had listened to concerns, Osborne said it was easier simply to avoid the changes altogether (Politics Home, 2015).

That was accompanied by the announcement of no cuts to police budgets and the frontloading of NHS funding at £6bn next year (ITV, 2015; Dominiczak, 2015). In sum, these announcements gave the impression of a much less stringent budget, on the back of an Office of Budgetary Responsibility (OBR) assessment that more money would be available, with lower borrowing costs, and so less would need to be cut (Reuben, 2015).

These announcements followed the Osborne's habit from previous budgetary statements and announcements, of pulling out a surprise. And yet, for everything that Osborne hasn't cut, he is still gambling on the market bailing him out later by delivering the OBR's predicted strong economic conditions, rewarding him with higher tax receipts, if he is going to meet his own targets.

If expectations and receipts fall short then cuts will still have to be found later. In fact, the observation has been made that the backdown on tax credit cuts is only a temporary stay, as the cuts will still come with its phasing out to be replaced with the universal credit by 2020 (Kuenssberg, 2015; Eaton, 2015).

Burdens are once again being shifted by the Chancellor. Along with the private debts taken on over the last five years by students, joined now by student nurses (BBC, 2015), there will be caps on housing benefits (Peston, 2015). There was also no relief from the Tampon Tax, with the odd decision to maintain the tax but to use it to fund women's charities (Richards, 2015).

The burdens are also being stacked onto local government and the private sector - with new taxes on business to pay for apprenticeships and local government expected to raise local rates to cover certain services (ITV, 2015{2}; Wintour, 2015).

Full analysis of the line-item details will follow from all corners of the media and political world.

Yet the initial impression is that the Chancellor is once again taking a risk. Osborne is gambling on markets and the broader economy to perform well enough to buy him time and space until the political storms blows over - which allows him to wriggle around on the nose cuts, in favour of less dramatic phased changes.