The Guardian leader on 30 th January rightly says that Ms Reeves approach lacks ‘compassion or moral purpose.’ This is because it confuses means with ends. GDP growth only matters if it makes life better- a point also made by the heckler quoted by Aditya Chakraborti’s piece in the same edition (‘That’s your bloody GDP. Not ours.’)

The short term goals of Labour economic policy should be to improve the living standards of those who are struggling, and to rebuild our public services. The medium term goal should be to build a society and economy in which improvement in living standards and in public services is continuous and sustainable- environmentally and economically.

The two short term goals require a lot more money than Labour currently plans to spend, and a significant change in how it is raised. The current proposals, partly inherited from the previous government, include an increase in taxation paid by those on relatively low incomes and a decline in the real value of benefits. 

Raising the revenue needed without further harming those who are already struggling requires abandoning the foolish commitment not to use the most efficient and equitable methods of raising more revenue. We need income and corporation tax increases, a serious effort to end the over generous treatment of capital gains, and a reform of our property taxes.

It will be argued that a big, redistributive tax package to fund public expenditure increases and increased welfare provision will discourage private investment, and might reduce overall GDP growth. However, it also puts a lot more money in the pockets of people in every region of the country, people who will spend that money locally. That will boost ‘our  bloody GDP’, rather than further inflating the London economy. Untangling means from ends, it may be worth trading off a a slightly slower economic growth rate for a better distribution of that growth across the country.

There is also an argument that a large tax hike now to fund fundamental improvements would be preferable to a timid reform that leaves the economy struggling into the indefinite future with a mountain of debt, sluggish growth, terrible public services, collapsing infrastructure and stagnant living standards. Our tax burden is high by UK standards, but is still far short of some successful European countries. The private sector might be persuaded that bold measures today will create a better environment for future investment than the endless dreary trudge set out by the Government.

Two complementary measures would make a positive private sector response more likely. The first is an unequivocal commitment to a close relationship with the EU, preferably  including a commitment to seek to rejoin the single market. This is the one measure that would unequivocally deliver the increase in economic growth that the Government wants to see. The second is increased financial support to enable local authorities to provide the services they are required to, preferably combined with far less interference in how they spend it. Local people are those best placed to decide how best to use limited resources. 

My final point is that this agenda is hard enough, and the Government needs to stop inventing new and challenging tasks that are costly and difficult and do not contribute to the main goals. This is not the time to ask local authorities or Government Departments to plan for major re-organisation and reform. It is definitely not the time to embark on discussions about a third London Heathrow runway that will not see aircraft flying until long after this Government has departed. 

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