Sanders drops out and Keir Starmer elected Labour leader

With COVID-19, much of my focus has been on that so no new blogs, however tomorrow I will write one on possible economic and political implications.  Obviously at this point still a lot of speculation, but what we can say is this is a life changing event and while many things will return to normal, many changes will be permanent and some in ways we don’t know.  However looking at two major leadership decisions in last week and my thoughts on those.

Sanders Suspends campaign

With COVID-19 making campaigning difficult, Sanders did right thing is at this point as focus should be on getting through the disaster not leadership.  Also gives party time to unite behind Biden as many hardcore Bernie supporters are reluctant so having more time to unite party is a good thing.  Also Sanders recognizes that even if Biden is not as left wing as he wants, Biden will still move in same direction, just not as far and as fast.  And he also realizes that for his supporters and what they want, a second Trump term would take country in the opposite direction.  So I applaud him for withdrawing and believe party needs to find a way to reach out to the progressive supporters he brought in, but not go too far.  With massive deficit, funding a lot of Sander’s promises won’t be realistic at this point so focus should be on getting the ball rolling realizing those who want a more Progressive America, it will take time.  More importantly defeating Trump hopefully forces GOP to expunge him and his right wing populism and return to its traditional conservative roots as a healthy democracy needs at least two reasonable alternatives, not a choice between acceptable and too extreme.

Keir Starmer elected British Labour leader

With Boris Johnson taking Tories to record levels in polls, many might say so what, but reality is while Brits rallying behind the leader through COVID-19, there will be tough choices in the aftermath and no doubt Johnson’s polling numbers should come down to earth a bit.  Keir Starmer was the better choice, but has both positives and negatives.  With 2024 being a long ways away, I think making a prediction for next election is a fool’s game, but he does seem in many ways like 21st century version of Neil Kinnock.  Steering the ship away from hard left, but still not pivoting close enough to the centre to win.  Otherwise improves party standing, but leader after him takes them to power.  But off course this is more a gut reaction than a scientific prediction as really at this point I wouldn’t want to bet a lot on any particular outcome.  Below are his Positives and negatives

Positives: Keir Starmer looks and sounds like a PM and in today’s world image matters a lot.  He comes across as experienced and competent whereas Corbyn more came across as a 70 year old social activist and reality most mainstream voters aren’t interested in some social activist taking reigns of power.  Is left wing enough to keep Corbyn faction from splitting, but moderate enough to keep Blairite faction in tent.  Also frontbench has more talent and the more loony left elements play a less prominent role

Negatives: On policy he still clearly leans left and in last 40 years every election has elected either a centre-right or centrist PM, no candidate to left of Tony Blair has won since 70s thus recent history has not be kind to British left.  Things like promising to nationalize utilities, rail, mail, and water may sound good on paper, but high cost could scare voters away.  Abolishing tuition fees may bring out more young voters, but cost especially post COVID-19 may make it too expensive so might be better to keep this promise, but to do so over two mandates not right away.  And probably his biggest liability is promise to bring back free mobility of labour for EU nationals.  This may appeal to younger voters and thus might be feasible 20 years down the road, but is political suicide in traditional working class areas in Midlands and North which party needs to win back.  Those areas voted Brexit primarily because they want to end free mobility of labour and any promise to bring it back just increases chances they stay with Tories.  Some like taxing rich more might be an easier sell as don’t think UK wants a second round of austerity and with no more free mobility of labour less risk of wealthy moving to lower taxed jurisdictions.  Still he needs to be careful there as unlike in Canada, attacking success hasn’t gone over well with British voters so tax hikes on top should still ensure UK stays competitive and only be put in place until UK balances the budget (which is likely at least a decade away).  Otherwise those in top 5% will see rate rise from 40% to 45%, and top 1% rise to 50% from 45% but such rates will revert back to current once budget is balanced.  I don’t think they should raise top rates at all due to how little revenue they will get, but I realize Labour base won’t accept not raising them so this is one that keeps base happy but still allows party to be more competitive amongst middle class professionals.  For nationalization, I think rail is most feasible, so maybe stick with that one and ditch others or perhaps buy a stake in utilities, water, and Royal Mail but still retain majority private ownership, but regain enough shares to have influence on board but not be a boondoggle in cost.  I don’t support re-nationalization of any industries, but this at least is again more feasible.

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