Referendum Victory: Catastrophe Averted – or Deferred?

(The following is a slightly amended version of my Glasgow Fabians presentation.)

First, the title: Referendum victory: a catastrophe averted – or deferred?

Part 1: Catastrophe:

Let us consider two potential catastrophes: most immediately, for Scotland, Scottish economy and Scottish people.

And also for Labour – will come to implications for Labour Party later.

First, need to be very clear how great the risk of economic catastrophe was.

If vote had been Yes, we would already have following effects:

  • £100millions which went back on Scottish companies on Friday 19th September would have stayed off, and would have been added to, at accelerating pace.
  • Orders would not have been placed at Rosyth and for Clyde Shipyard
  • Contingency plans in Scottish-based companies would have become operational
  • Thousands of house sale transactions would have been cancelled
  • Thousands of investment decisions would have been at least delayed, many cancelled
  • Thousands of job offers would not have been made by employers
  • Above all, party conferences would have seen Labour, Tories and Lib Dems re-iterating rejection of Currency Union. They would do so rationally and pragmatically, as it would be preferable to take short-term but quantified (if hefty) hit, rather than indefinite and unquantifiable (and probably even more costly)

Medium term prospect for Scottish economy would have been either joining the Euro and being linked to most sluggish and conservative currency management in the developed world, now on the brink of returning to recession combined with deflation;

or sterlingisation, which would have required public expenditure cuts to build required balances.

Add to these £6 billion per annum deficit identified by the IFS and catastrophe is not hyperbolic: massive business uncertainty and cash/capital flight added to massive public expenditure cuts.

It is notable that these proposals were greeted by Adam Smith Institute but not surprising.

To those who bought Salmond’s “they are only bluffing” line or even considered Stiglitz’s views in contrast to Krugman’s there is one argument: would you risk it?

For Labour, a Yes vote would also have been a catastrophe.

First, and foremost, a catastrophe for the people we represent: public expenditure cuts, job losses, higher interest rates meaning higher credit and mortgages and unemployment caused by jobs moving south.

Ian Smart wrote in his blog of:

“The idea that there is likely to be no major financial consequence to Independence is bordering on the delusional. And not just consequence for “the country”. Financial consequence for every voter. And their children. And their parents. And their friends. We have to say that loud and clear. Yes means a devalued currency; higher prices in the shops; lower pensions and benefits in real terms; mass unemployment; collapsed property prices.

“Independence is not something we could “give a try” and then change our minds about later. It would involve not “a wee bit of hardship” as some of the less dishonest Nats might concede. It would involve years of grinding misery with living standards butchered and with the civil unrest and human misery that would inevitably follow.

http://ianssmart.blogspot.co.uk/2014/09/time-to-be-blunt.html

He bases his view on that set out by David Smith, Economics Editor of the Sunday Times. http://www.economicsuk.com/blog/002045.html#more

Or as Paul Krugman, top Keynsian and Nobel Laureate, put it: “Scotland would be like Spain without the sunshine.” – And, of course as in financial crisis, it would be the least well-off who would suffer most. So a catastrophe for the people Labour works for.

So Labour could only back a No vote, and politically, a Yes vote would have been politically catastrophic for Labour.

First, it would have exposed the weakness of Labour’s position in Scotland. Our recovery from the poor performance of 2010 and the disaster of 2011 is fragile to say the least. Anyone who has campaigned knows that out strength on the ground is desultory despite the efforts of some really energetic people. But the underlying trend is a steady loss of votes and a weakening power base which has been masked by the FPTP system and multi-party splits. It is as the SNP hoovers up the votes of the weaker parties that their strength grows.

Secondly, a Yes vote would have been the death knell of our Labour MSPs. One of the causes of the 2011 debacle had been our underlying weakness at Holyrood, shown up in performance of  our MSPs in opposition since 2011.

Again, failure would have continued and accelerated the decline of Labour at Holyrood and the advance of the SNP.

Of course supporting No was not without risk. In particular, association with the Tories has inevitably led to accusations of caring more for business than people, selling out the ghosts of Keir Hardie and Attlee and all the rest. I will come back to this later when addressing the challenges we face, and how we might go on from here.

However, it is worth putting forward the point that Labour was effectively the custodian of the biggest share of the potential No vote, that is the part of the electorate less likely to vote Yes or the for the SNP. It was in effect, Labour’s referendum to win or to lose.

Add this to the elements which I have already outlined, and Labour’s stake in the referendum was a battle for our existence. If we had lost the referendum, Labour in Scotland would have been finished.

Don’t take my word for it: if Nicola Sturgeon said it would be the best thing that could happen for us, expect the opposite to be true and there you have it. For Labour, the referendum was an existential struggle.

Part 2: Catastrophe averted – or deferred?

So on to the second part, in which I will try to address the issue of how we might proceed – and will start with a bit of how we got here.

I should also fill in some details about my own involvement in Better Together. In short I worked in the better together office two afternoons per week from September 2013, so about a year.

In that time I saw it staff up and develop and eventually succeed. I was not at any time involved in strategy – although I did make some suggestions – and I was involved at times in some research work, writing some articles which appeared around the web. And like everyone else, I was involved in the massive logistical exercises like posting 100,000s of direct mail shots.

By the time I arrived the strategy had been formulated and was roughly as follows:

Weaknesses:

  • Yes was (at that point) better funded and could not be out advertised
  • Yes had advantages of Salmond’s position as FM and personality, press profile etc
  • Yes had advantages of Scottish Govt incumbency, therefore of arts, business, voluntary sector patronage
  • Yes had advantages of sentiment, heart over head widespread buy-in from cultural figures etc.
  • Yes had advantages conceded by UK Govt of Question (they had Yes.)
  • Yes had electoral data of SNP on support for independence
  • Tory government with 1 seat in Scotland, i.e. perceived lack of legitimacy of Westminster

Strengths:

  • No had far greater credibility on technical detail of proposals as any conjecture could be tested against real life
  • No had far greater credibility on currency and therefore economy: eg the IFS vs Business for Scotland
  • No had far greater credibility with business, the press and academics (who understood implications)
  • No had overwhelming past support from all parties (inc SNP voters from 2011) – 40 years of No in opinion polls
  • Support of majority political parties.
  • Support of key trade unions like USDAW and GMB and crucially trade unionists in iconic industries, especially shipbuilding.

No strategy was therefore:

Not to try to compete on sentiment but on reason: based on political science

Alan Renwick, Reading University: In referendums as in the rest of life, heart precedes head. Interventions in a referendum campaign provoke heart reactions and head reactions: they stimulate our emotions and feelings; and they prompt reflection on what fits our principles and aspirations. But, just as in life in general, these reactions differ in their speed. The heart comes first. Only later does the head begin to take over. http://blogs.lse.ac.uk/politicsandpolicy/scotlands-referendum-debate-what-is-really-going-on/

and reflecting contemporary psychology (Daniel Kahneman’s “Thinking Fast And Slow” or the conflict between “intuitive System 1 and deliberative System 2 thinking”) – despite first reaction usually for Yes, NO can win on rational grounds, given the correct material and enough time.

  • To use social media in early stages rather than public meetings, events etc
  • To concentrate overwhelmingly on information rather than sloganizing and events
  • Use of direct mail and telephone canvassing
  • To measure success during campaign by focus groups and private polling
  • Follow basic structure of Obama campaign (risk not “Yes we can” but “no we can’t” is not a good fit)
  • Avoidance of UK/British imagery (i.e., no extra votes in band of the Grenadier Guards, anymore than in “Do you want to live in one of the most prosperous countries in the world” when we already do.)

So what happened?

In short, Yes played a weak hand well. In particular,

  • early emphasis on meetings and events generated internal momentum and morale
  • support from media-savvy cultural community
  • exploitation of key phrases like Project Fear
  • capture of idealistic/radical agenda

 

No played a better hand moderately well. In particular

  • Unity of parties and their resources
  • Use of currency issue
  • Infographics
  • Exploitation of SNP dishonesty shown in office (EU advice)
  • Careful use of names and personalities (Pennington, Wood, Branson, Geldolf, not Cameron, sparing use of Brown, Kennedy)
  • Held nerve over longer term, so that late interventions were additional rather than substitute
  • Successful organisation to get out the Vote: own experience was at 8:45 pm I was phoned by phone banker from Reading asking if I had voted. Impressive networking.

Which brings us to the final weeks, the Vow and Gordon Brown.

The key questions which will always be asked are:

  • What difference did the YouGov poll make?
  • How effective was the vow made through the Daily Record?
  • Did Gordon Brown save the union?
  • How did Labour lose so many votes for NO?

So: Yougov.  YouGov was identified early on as the pollster which had been most accurate in its measure of the 2011 Scottish election, and was that reason favoured by No. Yes had its own favoured pollsters, Survation and Panelbase. So it YouGov was taken seriously when it showed the gap first narrowing and then vanishing. If you look at those polls in fact, the poll of 1st September showed Yes at 47% and No at 53%, easily within the standard 3% margin of error of the final outcome. These figures were repeated on 11th and 17th September.

But the poll of 5th September showed Yes ahead.

However, the effect was entirely positive on the campaign (although its legacy is different.)

For the campaign, the effect on No was electrifying. I went into the Better Together office on the Monday afterwards and it was swamped by volunteers. Morale and determination had been galvanised. Speak as veteran of Bermondsey and Govan 88 bye-elections where moral slumped. This time, the phones were staffed and the envelopes were dispatched.

At the same time, the Labour Party was out doorknocking in its biggest ever ground operation: 300,000 doors knocked, and with  special attention to new entrants to the electoral roll.

The other reaction was of course from the political leadership: the three party leaders gave impression of urgent responders – or blind panic, and Gordon Brown reappeared with his old time Labour religion. But to what effect? –which is the second question.

The answer is not much – and a lot.

The not much is that it does not seem to have changed many minds: polling shows that only 10% made up their minds in final week, and of those 7% went to Yes and only 3% to No.

Instead the lot of difference may have been vital: the effect on turnout. Anyone who remembers 1992 knows how high turnout can favour the status quo, above all where change implies a clearly identified to risk. And the relationship between turnout and outcome in the referendum points out a further possible correlation: the lower the turnout, the higher the chance of a Yes vote. Lowest by turnout were: Glasgow (75%) and Dundee (78.5%).

In West Dumbartonshire something else may have gone on, with 6th highest turnout but voting Yes: possibly due to Trident as a specific local issue. Which leaves N Lanarks as an anomaly.

Overall, there is speculation that increased turnout favoured Yes only up to a certain point (possibly around 80%) and above that point, it favoured No: it represented more people turning out to protect the union. And in that respect: not that of changing views, but in boosting turnout of No voters, Gordon Brown and the 3 leaders may have saved the union.

The legacy of the intervention is however more mixed, and will present a serious problem if it is not dealt with well. This is the widespread perception that the content of that intervention changed the minds of large numbers of voters, and therefore the outcome of devomax/devoplus will be crucial.

This is of course very convenient to the supporters of independence who believe devolution to be a halfway house, rather then the best of both worlds, or those who, as Salmond put it: “measure progress not be how far they fell short but by how far they had come.”

The myth which must not be allowed to take hold is that there is a large number of hitherto Yes voters who were swayed to No by promises of near-independence.

Which brings us onto the politics which we now face in the post-referendum age, which includes the issue of the loss of votes to Yes.

My conclusion is that Labour helped avert the catastrophe that would have been independence.

However, unless considerable political progress is made over the next two big elections, there is a real risk that it may be only a deferral. A battle has certainly been won, and the starting place is much better than it would have been, but there are many more battles to fight and win, and each of them are existential for the Scottish Labour Party and possibly for the union.

One of the big features of that post-referendum age is the strength of the SNP. Latest figures on social media put its membership at 100,000, and even at £12 per year per member, this demonstrates a formidable force than Labour has faced since the Tories went into decline in the 1970s. It is also at least another £1,200,000 to add to the Weir millions.

(The only silver lining is that these people have not done the smart thing and joined Labour to over-run us and turn us into a nationalist party.)

Disadvantages however, are massive. First, the numbers which the SNP will be able to mobilise.

Second, the motivation they share, born of the intensity of their hatred for Labour: language like “eviscerate” “bury forever” “destroy” etc: if they cannot have independence, the extermination of Labour will make a good second best. (Robin MacAlpine: “the biggest single obstacle to social progress in this country is Scottish Labour Party” – bigger than a Tory UK govt, rogue capitalism, poor employers, loan sharks, ill-health, poor housing, unemployment: yes, that is us.) http://www.youtube.com/watch?v=SkC2qW8KhO8

Third, our own weakness: in membership, in engagement and in policy presentation. This includes presentation of our record, which may have had a bearing on the high numbers of people from deprived areas who voted Yes.

I know that this is nothing new, but I think this is a good place to begin discussion.

Here are a few things to chew on:

First, evidence of referendum is that our membership is low and our active membership is lower still. Having said that Labour knocked 300,000 doors and therefore has a new and current political data on those areas where No did not do well.

Second, as John McTernan has put it: “Scottish Labour at first was unwilling and then was ultimately unable to articulate Labour’s record” Or “when did you last hear a member of the Scottish Parliament praise the record of the Blair/Brown governments?”

My experience as an activist is perhaps instructive: trying to find  out what Labour actually did in power is a lot more difficult than finding out what we did not do, and what we did wrong.

It is quite incredible that when we look back to Labour’s achievements, we are more able to recite those of Attlee and Bevan, and not of Harold Wilson, Barbara Castle, Denis Healey, and certainly not of Tony Blair, Robin Cook and Gordon Brown. Anyone would think that Labour’s radical contribution finished in 1951.

For example, Bob Holman was widely paraded as a witness to how Labour had lost its purpose: this should have been made a nonsense of by common knowledge that Labour had achieved real life improvements for vast numbers of people in his patch of Easterhouse: the National Minimum Wage, the right to trade union representation, Pensioner Credit, and especially the GHA write-off of housing debt which transformed the area’s social housing from the worst in Europe to standards as good as anywhere in the UK.

(http://wp.me/p3f2py-6p is my full response to this.)

But it isn’t common knowledge for the public: it is probably not common knowledge amongst Labour members. Just like tripling spending on the NHS or raising 1 million children out of poverty at a time where inequality was rising across the developed world. Basically, Labour members must do more to support Labour’s record.

If we do not, no-one else will. There is no point in complaining about the press coverage, or about the fact that so many Yes voters were people with low educational achievement or few qualifications.

Labour lost votes from No to Yes because we could not articulate what we are for, and how it benefits our people.

Part of this selective amnesia is our lack of appreciation of and the failure to argue up devolution. There is a widespread lack of knowledge what Holyrood does and can do, and what it will be able to do. A visitor from Mars or even Manchester would not have known that Holyrood exists to listen to the referendum debates until the SNP brought up the NHS – and promptly rubbished its powers.

This was one of the reasons that Yes and the SNP were able to gain any traction with their NHS scares. People should know by now that if they complaints or fears about the NHS in Scotland, Holyrood is where you go to.

Finally, there is an issue of the weaknesses of the concept of membership. The Labour Party which I joined in 1977 had three main components: the party in the community (including local government, and internally social), the trade union party (or party in the workplace), and the co-operators party (or the party in the high street) –with a few add-ons like the Fabians.

With the exception of the latter (joke) all of these were directly connected with and offered  services to the public – and above all with “our” public. These are all areas where we are now weaker – not only due to our own failings but also due to changes in leisure activities, employment (especially) and shopping habits.

But we must find ways of recreating our links with the public, with workers and consumers, and making ourselves relevant to them and their concerns. The evidence that we have not filled the void is the enthusiasm of the Yes campaign; and its evil twin, the rise of UKIP. But I suspect we all know that.

In the meantime, where do we go from here?

First, we have to realise that although Labour has survived an existential battle in winning the referendum, it has two more to come immediately: the General Election in 7 months time, and the Holyrood election 12 months after that.

Then we might see where we are for the council elections 12 months after that. And if we fail in the General Election, we are in big trouble for the subsequent battles. The SNP’s expectation is to triple its Commons representation by gaining 12-15 seats, mainly at Labour’s expense, with a few like Argyll & Bute, Gordon coming from LibDems. That means Glasgow seats in particular.

So what do we do?

First, we accept that we need to use every resource: for example, all of the work done by councillors week in, week out, in their communities must be dovetailed into the election campaign;

Likewise, trade unions must fully engaged as far as their political funds allow. We must use the data and the infrastructure created for the referendum campaign.

Above all, Labour must campaign on our record as well as on how we will improve people’s lives. We have a narrative which relates their concerns and needs to the achievements of the past and to current policies.

Most immediately, we need to start to make the weather surrounding the ways forwards. This could include:

  • Seize initiative in Smith Commission – where the hell are we? No presence at all on tv debate, last unionist party to submit evidence.
  • Casting policies in a way which are not apologetic about either being economically credible or socially progressive
  • Cast Yes and SNP as fighting battles of the past: referendum is as dead Bannockburn
  • Exposing SNP record on equality and competence in NHS etc
  • Turning new SNP members on their leaders: try to push them into looney left, Militant territory

Finally, I would refer to the comments made by John McTernan in Progress: http://www.progressonline.org.uk/2014/10/10/for-fox-sake/

and the quote from Norman Kirk of the New Zealand Labour Party: “New Zealanders don’t ask for much: someone to love, somewhere to live, somewhere to work and something to hope for.”

And McTernan’s own conclusion:

“We talk about housing policies when people want a home. We talk about jobs as an end in themselves when people see them as the start of something – the ability to make a downpayment on a dream. We see life as a set of problems to be solved by policies when people see life as something to be lived and enjoyed.”

In the referendum, Yes offered an illusion of that hope and of that dream.

And it was an illusion, and we were correct to reject it.

But we need to offer real hope and realistic ambition to the people of Scotland.

It a hell of a challenge. But it is worth taking up: it is the difference between a catastrophe averted and one merely deferred.

(Delivered at Glasgow Fabians, Saturday 11th October 2014.)

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