SIGNS OF LIFE

I wouldn't claim that either Peter Mandelson's speech at the LSE on Monday or Gordon Brown's strangely halting oration at the TUC on Tuesday mark the end of Labour's woes, but they are at least an intellectual el-Alamein. There's rather more fight left than I thought in what had appeared over the summer to be the lifeless corpse of New Labour -- and I'm beginning to think I was wrong to be quite so pessimistic in my last post on Labour's prospects.

There is a clear theme in the Brown-Mandelson offensive, which is all about how the government's actions in the past year have staved off -- or at least helped stave off -- an extraordinary economic disaster, and how it is the height of stupidity to advocate, as the Tories have done, axeing public spending at once when only public spending is keeping the economy afloat. What we need to do, according to Mandelson-Brown, is keep the state stimulus to demand going until we're out of the woods.

The Tory press – and the BBC, with notable exceptions – have made the story Labour's acceptance of "cuts", and of course the cretino-left has joined in, claiming that there's no difference except in degree between Tory austerity and Labour austerity.

But there is a very big difference. Both Brown and Mandelson made it clear that, over time, the money borrowed to shore up the banks and to keep demand alive in the world economy will have to be paid back. The thing is that it's over time. They made it equally clear that doing it at once, before vigorous growth has resumed, would be disastrous, and that the crucial task after the pay-back starts is to make sure that what will inevitably be austerity is also egalitarian.

Stafford Cripps 1947 or what? I'm impressed and not a little surprised that they've taken this line and done so with conviction. Now we need to make it the common sense of 2010: it's time for punitive taxes on incomes over £100,000, a new green pre-fab scheme for housing, nationalisation of public transport ... Ah, we can dream.