Sir Keir and Labour should be careful what they wish for

It is widely assumed that Starmer is preparing for power – but that could all change if the Tories manage to buy themselves more time

At the time of writing I have absolutely no idea who is going to be leader of the Conservative Party so let’s just skip to what everybody assumes will be the next stage and discuss what Labour will do when it is in government.

There are two quite different scenarios here. The first applies if a general election is called immediately, which is what Sir Keir Starmer claims to want but actually does not because at the moment he is in Opposition Heaven and would like to stay there until the present Government drags the country through – and out of – the depths of this crisis.

The second comes into play if the election is called in maybe six months’ time when the worst may be over, especially if, as many are now daring to predict, things never get as bad as expected. (Global gas prices are already falling precipitately and Bank of England officials say interest rates may not go as high as was feared.)

First, the immediate election option: this would instantly put Labour under the kind of scrutiny that the gleeful sadism of glib opposition allows you to avoid. If they are to take power within weeks at the very height of all this death-defying uncertainty, we must know precisely what their plans for dealing with it would be.

For example, we know that Sir Keir actually supported many of the earlier planned Tory tax increases. Having been so scathing about the Truss reversal of those policies, would his government revert to the status quo ante?

Does he believe, generally speaking, in raising taxes as the economy heads into recession? A particularly delicate point would be the corporation tax increase to 25 per cent, which would make the UK one of the least competitive countries in the world and certainly deepen the coming recession.

Much of the neanderthal wing of his party would call for the increase to be maintained because they think that attacking anything with the word “corporation” in it must be a good idea. But that would kill off many of the struggling small businesses in the aspirational Red Wall constituencies and damage the prospect of national recovery.

Whatever he decides on taxation, it will be absolutely necessary for Sir Keir to reduce government spending because even a triumphant new prime minister with a large majority cannot defy gravity.

If he does not do this – which is to say, introduce some forms of austerity – the markets will lose confidence once again and we will be back where we started.

So will he explain to the public sector unions that they cannot have pay rises linked to inflation because the bond markets would then pull the plug on the pound?

Given that he leads a sort-of socialist party would he be happy to tell his members that, even though they are nominally in power, the country is actually being governed by the international money markets? To them, that would sound like being ruled by capitalists. (Actually it sounds a lot like that to me and I’m not on the Left anymore.)

Then again, he could give in on public sector pay (for NHS staff this might have popular support, for rail drivers not so much) but that would stoke further inflation which would make the disparity with wages in the private sector even more painful. And, as even Labour leaders now understand, only a thriving private sector can create wealth.

Now what about net zero? We know that officially Labour is enthusiastically committed to this. Does that mean they will rescind the new licences for developing North Sea oil and gas reserves which the Truss government had granted?

Even if that means that heating will be more expensive into the foreseeable future for everyone but most alarmingly for the less well-off who presumably cannot have their energy bills subsidised indefinitely?

If Sir Keir decides to let those new licences go ahead, he will almost certainly be confronted by a fresh wave of pestilential protests blocking the public highways.

Will he side with the bourgeois brats of Just Stop Oil or the working people trying to make a living who are infuriated by them? This will bring the real class split in the modern Labour Party into very clear focus.

So what about the prospect of a later election? You may think that this would be the easier road for Labour to tread.

If the Tories – led by whomever – manage to put off the demand to go to the country instantly, they could have a good six or eight more months in office.

By that time, the economic future – and which remedies actually apply to it – should be clearer.

There will still be a lot of what politicians like to call “hard choices” but the advantages of higher interest rates to savers and lower house prices for buyers will now be entered into the real-life equation.

A lot of “ifs” come into this. If the winter has been mild and the West has coped reasonably well with gas prices (which turn out to have peaked earlier than expected). If interest rates do not soar but simply stabilise at a level that most previous generations would have thought normal.

If the Russians are fought to a standstill (or Putin is removed) and Ukraine becomes once again the bread basket of the world so that food prices fall. What then?

Well, Labour would then have a much easier landscape to occupy. It could enter Downing Street on an upward curve of national relief and optimism and take credit for the recovery that followed.

The shambles that we are now living through would be a memory permanently associated with the Conservatives – just as the ERM crisis had been for another generation. So surely that is what Labour really wants?

Oh wait. There is a chance that, because the Tories changed leaders at precisely this moment – unlike their predecessors who allowed John Major to remain as a ghostly curse on their electoral credibility after that earlier debacle – they could possibly get the credit for saving the day. Imagine that.

Having been so scathing about the reversal of tax increases, would Labour revert to the status quo ante?