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Despite his enthusiasm to see new ideas flourish in the party, Miliband was always torn over the issue of Labour’s economic credibility with the electorate. In contrast to what might be expected within the materialist and institutionalist literatures (see Streeck 2011; Bailey 2009), this issue of ‘responsibility’ was dominated by electoral considerations; there were no major fears over the material effects of market reactions or EU sanctions. As an economic advisor to the party leadership acknowledges, ‘we weren’t particularly expecting a run on the pound or anything in that sense’, rather, this was a purely electoral issue that centred upon

123 _{Jonathan Rutherford, personal interview, 23/02/2016.} 124 _{Marc Stears, personal interview, 17/02/2016}

125 _{Jonathan Rutherford, personal interview, 23/02/2016.} 126 _{Senior Strategic Advisor A, personal interview, 16/11/2016.}

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challenging the Coalition government’s public construction of the crisis as ‘Labour’s mess’.127

Immediately upon becoming leader, Miliband commissioned the US-based firm Greenberg Quinlan Rosner Research (GQRR) to produce internal strategy reports. These reports offered a robust and immediate warning: ‘A Labour leader who argues that we should keep spending to secure growth is flying in the face of common sense and would need a volte face by the entire media to have any chance of success’ (GQRR 2010); GQRR 2011a).128

From the outset, then, there was a strong feeling that Labour needed to develop an economic programme that was seen as equally credible by the electorate as the Conservatives’ plans, but which allowed for a more activist approach to redistribution and investment. ‘Credible, but not austere’ is how Wood put it to me (see also Bremer and McDaniel 2019).129 _Dealing

with this issue of fiscal ‘responsibility’, however, divided opinion internally within the party; tension became apparent as the party struggled to balance the simultaneous requirements of successful statecraft, i.e. developing a policy package ‘capable of being sold successfully to the electorate’ that could simultaneously ‘unite the party and stimulate members’ belief’ in the programme (Bulpitt 1986: 21; see Wickham-Jones 2013).

127 _{Senior Economic Advisor A, personal interview, 03/12/15. There is a question here on the relationship}

between voters and non-party political actors and the influence that the latter has on the former. For instance, to what extent does the electorate takes its cues on the nature of ‘economic credibility’ directly from business people or financial market actors? Clearly, these ‘business’ actors have some degree of influence in the public debate, alongside rival party-political actors, the media, think tanks, etc. It is difficult to disentangle the influence of these various actors and there certainly is not room in this thesis to address this question fully (see, for instance, Dür 2018). However, for the sake of my analysis here, I rest upon the assumption that it is possible to distinguish analytically between the perceptions of the public at large (on issues such as which party is best placed to manage the economy) and the anxieties of market actors. I would argue that this is reflected in the statements of party actors, such as the one quoted above – i.e. Labour did not fear a negative market reaction if elected, but worried that the electorate’s dim view of its economic credibility would restrict its ability to get elected in the first place.

128 _{Similarly, a political strategy document sent to Miliband the following February entitled ‘Rebuilding}

Labour’s economic credibility’ warned, ‘our lack of perceived economic competence is a ceiling on our ability to grow and consolidate our vote’ (GQRR 2011a).

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Since the election, Ed Balls (2016), who became Miliband’s Shadow Chancellor in January 2011130_{, has suggested that there were three main currents of thought in the party}

(and, indeed, differences emerged even within Miliband’s team itself). Some felt Labour should simply accept the Conservatives’ fiscal plans and look to ‘shift the election debate’ towards more favourable hunting grounds like the NHS. Others argued that Labour had to ‘admit that we made mistakes during our time in office, that we’d borrowed and spent too much and that excessive spending was to blame for the financial crisis’. A third option, the opposite of the second approach, was to robustly defend Labour’s record on normative grounds and set out a ‘detailed alternative on the deficit’ on cognitive grounds (Balls 2016: 331-333). Indeed, Miliband’s own team was divided over this issue.131

Miliband was torn between the recommendations of some of his advisors – such as James Morris, Miliband’s pollster and focus group analyst from GQRR – ‘to deal decisively with the deficit issue by matching the Tory plans’ and his own instincts to make the case for more borrowing for investment (Balls 2016: 338). Stears, Miliband’s close friend and speechwriter, suggests that Miliband was always ‘trying to square the circle between

believing the crisis had revealed fundamental failings, on the one hand, but also believing that the public were deeply sceptical and anxious and less likely to respond to bold arguments for economic reform’. 132 _{This ‘tentative’ nature led Miliband to have ‘serious political problems}

with Labour being an “anti-austerity” party’.133

Similar to Miliband, Balls (2016: 334) argues he wanted to support the third option; however, whilst his ‘economic instinct was to set out a clear [economic] alternative to George Osborne … [his] political antennae said this was an argument that just could not be won’.

130 _{Alan Johnson resigned after only a few months as Shadow Chancellor for personal reasons.}

131 _{Some, such as Tom Baldwin, Labour’s chief of media and strategy, wanted a more consistent and vigorous}

assault on the idea that Labour were somehow to blame for the crisis (Baldwin cited in The Daily Politics 2015). Others, such as Wood, were keen for the party to move beyond this debate by drawing a line under the New Labour years in order to set out its vision for the future of the UK economy. (Marc Stears, personal interview, 17/02/2016).

132 _{Marc Stears, personal interview, 17/02/2016; also Senior Economic Advisor A, personal interview,}

03/12/2015. Indeed, a key issue running through the parliament was Miliband’s own hesitancy in pursuing new ideas with conviction – or what has been described elsewhere in the literature as a ‘chronic indecisiveness’ (Bale 2015a: 262-4; Goes 2016: 52).

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This idea reflects a sentiment amongst party advisers, also found in the academic literature, that ‘busting the myths’ propagated by the Coalition government surrounding the deficit and the crisis as ‘Labour’s mess’ was simply a ‘waste of time’ – it was necessary to ‘concede and move on’ (see Bale 2013).134 _{As Chris Leslie, an MP from the Blairite wing of the party, put}

it: ‘wide-eyed academic’ Keynesian arguments around stimulating growth were not going to convince the electorate of the party’s economic credibility.135 _{Indeed, throughout the}

Parliament, the feeling within the Balls camp was that Miliband ‘was doing too little to show we understood the [economic credibility] concerns the public had about us’ (Balls 2016: 326).