Convergence Politics

The politics of convergence seems to be a phenomenon of our times

The politics of convergence seems to be a phenomenon of our times. It can be seen in the efforts of governments in the European Union to bring their economies into line this year in order to qualify for membership of a single currency. It is a clear feature of President Clinton's second term agenda as he seeks both to co operate and compete with a Republican Congress. And day by day it is a feature of the British general election campaign, as the Labour Party removes suspected electoral hostages to fortune with a pledge that it will follow the Conservatives' fiscal guidelines and not increase income tax bands while maintaining many of the labour market changes made in the 1980s.

The argument is made that the internationalisation of economic affairs has removed the discretion which national governments particularly centre left ones assumed they had in the decades following the second World War. Ever since the Mitterrand government's failure to reflate the French economy in the early 1980s, the lessons have been drawn by these parties that they are obliged to pursue such policies on, a regional rather than a national basis. Throw in the triumph of market reforms, competitive norms and deregulatory policies in the latter part of that decade, and we have the setting in which convergence policies have been expressed on both sides of the Atlantic.

There is a striking similarity between the Clinton and Blair platforms which could make for an interesting political agenda if the Labour leader wins the British election. In a speech this week, Mr Blair spelled out Labour's business policies: education, welfare reform, infrastructure and leadership in Europe. He said that just as the Democrats are known not to be against business in the United States, the same should be the case for Labour in Britain, occasioning a hostile outburst from Mr Michael Heseltine.

Mr Blair and the shadow chancellor, Mr Gordon Brown, are well aware there are other sources of taxation revenue besides income - which could yield the resources to fund reforms. But they clearly believe there are votes in convergence with Conservative taxation policies, not least by changing the image of Labour as a tax and spend party. The Conservative response shows Labour has struck a nerve; Mr Brown's statement may affect the validity of the Tory advertising campaign saying that a Labour victory would end in tears, with strikes and instability mounting. Sceptics on the Labour side fear the leadership may have painted itself into a corner in which the party could alienate its traditional supporters - among them the civil servants who will want to break out of a wage freeze.

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This is one of the principal reasons why Mr Blair has sought to reach a detailed agreement with the Liberal Democrat leader, Mr Paddy Ashdown. It would give the Labour leader an extra layer of insurance against being blackmailed politically from his left. But as the most astute observers caution, it is still much too early to write off Mr Major and the Conservatives. The argument that they are to be preferred to a Labour Party converging towards Tory policies, still has a long time to run before the election is held.