Labour goes into its annual conference this week mired in a civil war over whether Gordon Brown will remain as leader.
So called “loyalists” have joined key supporters of former prime minister, Tony Blair, in demanding Brown face a leadership election.
Both sides support the fundamentals behind the New Labour project – above all full blooded support for the free market. Yet this comes at a time when such policies are, literally, bankrupt.
Gordon Brown is fiddling while all around burns. He tells us he will not resort to “short term gimmicks” in response to soaring energy bills. Instead he advises us to draw the curtains and switch off the lights.
The chief executive of energy giant E.on, Mark Owen-Lloyd, joked last week that a harsh winter “would mean more money for us”. He is one of those responsible for fuel bills soaring by 30 percent.
But Brown is so desperate to be seen as pro-business that he has ruled out a windfall tax on the massive profits of the energy companies.
This is a measure backed even by the Daily Mail and the right wing prime minister of Italy, Silvio Berlusconi.
The tragedy is that Labour MPs pulled a parliamentary motion supporting a windfall tax in order not to push Brown further into the mire surrounding his premiership.
Across Britain swelling numbers of households are struggling to pay their mortgages and are at risk of repossession.
Brown’s answer is to rely on the market to solve the housing problem.
But as housing waiting lists grow building workers are being thrown on the dole as private companies abandon building projects for fear of losing cash.
One simple solution to the crisis is to build council houses – but this is ruled out by Brown because it is “anti-market”.
There are many other areas where Labour policy does not make sense – pay restraint, for example.
The mantra is that wages must be held down to stop inflation getting out of control. But what must be obvious to even the most blinkered union basher is that inflation has got out of control without any help from rising wages.
Pay cuts will not stop inflation, and they will mean misery, insecurity and rising debt for millions of people.
They will also stop people buying in the shops – worsening the economic crisis.
Because of this some governments have tried to intervene to boost their economies.
In Japan, the government recently called on businesses to increase wages to revive consumer demand. Even George Bush’s administration in the US has been handing out tax rebates.
These are classical Keynesian remedies that would have once favoured by Labour. But it is now so wedded to the free market that Brown refuses to look at such measures.
The only “solutions” he will consider are those that bolster the rich at the expense of ordinary people.
All the while the crisis feeds greater instability across the world and Britain remains the US’s attack dog in Europe, lining up behind the US against Russia.
Never has a more radical change of course been needed for millions of scared and struggling working people. But Brown and New Labour have turned their backs on both.