BACK in February, I asked: “Will Rachel Reeves really spend £28 billion a year on a Green Prosperity Plan?” It’s worth asking again because Labour’s most stupid rightwingers are beginning to rally against even this thoroughly centrist plan.

Reeves’s plan is, broadly, that a future Labour government will encourage the growth of greener British manufacturing, along with better insulation and other energy-saving measures, through a mixture of government and private investment, tax breaks and other incentives.

To get the plan off the ground, Reeves has to make the argument that investment isn’t a “waste.” If you own an asset, it isn’t the same as “spending too much money.” If you buy a valuable asset you still have your “money,” only it is now in the form of something that might help you, do you good, or even save you more money. It is OK to borrow to invest, as long as your investment is sound.

This is not, in fact, a complicated argument to make. It’s an argument most people understand like this: it is better to own a house than rent one. The idea of a “mortgage” is not some unknown, complex economic instrument.

Borrowing money to buy a house is OK because it is cheaper than renting. Long-term interest rates for such an obviously worthwhile object as a house are lower than the profits your landlord wants to squeeze from you — and you get to own a house at the end.

As long as the investments Reeves wants to make will save the country money in the long run, borrowing to buy them is totally fine.

Unfortunately for Reeves, the “moderate” power grab at the top of Labour has relied on the most ignorant Labour MPs repeating the most idiotic right-wing claims made by the Tory press to expunge the left. This does not equip them to argue for a big investment programme.

Shadow frontbenchers who are sent onto Question Time to make “we can’t afford it” arguments about nationalising water are, I think, genuinely confused about how to argue for a big borrow-to-invest programme. Stuck at primitive “handbag economics” they can’t even make an argument for a “mortgage.”

This became clearer in a background piece written by Patrick Maguire in the Times. He quoted a “senior Starmer aide” as saying: “We can sell jobs, lower bills and national security to the public. We probably can’t sell billions more debt.”

If Starmer’s aides say they can’t make a borrow-to-invest programme, the plan is looking shaky — presumably, the same aide would advise against their friends buying a house with a mortgage because he can’t “sell £300k debt.”

Reeves’s programme is heavily modelled on Joe Biden’s Inflation Reduction Act. This will spend around £500 billion on supporting “climate-change friendly” industries, as well as some social measures like health and childcare spending. Biden, a centrist, leant left and pushed this plan. He feared if the Democrats offered nothing, Donald Trump would win.

Whether you view this as accommodating or co-opting the left, it means Biden can use some of the personnel, arguments, passion and energy of the dynamic Bernie Sanders left. However, Starmer and Reeves don’t viscerally fear the right, like Biden — their deepest anger and disgust is aimed at the Corbynite left.

So, outside of Ed Miliband, they’ve got very few people who can drive this agenda, and too many of their close mates who are instinctively drawn to a do-nothing approach.

I think there is a strong likelihood that, if elected, Reeves will get some of this agenda in place. Thanks to worries about the shocks of Covid, the Ukraine war and the rise of China, some of the business elite are receptive to a government moving away from a neoliberal tendency relying entirely on international “free trade,” towards shorter supply lines and more government-supported national industrial capacity.

A strong element of Reeves’s plan may involve government subsidies to corporations through tax breaks and investments — which isn’t hard to sell to corporations.

But Reeves’s plan will be twisted and trimmed. Biden is really driven by fear of Trump and China, so he’s being much braver than Reeves. But even Biden’s plan has really been cut back.

Biden’s original “build back better” scheme lost some social spending thanks to resistance by right-wing Democrats, so the final pan, the Inflation Reduction Act, is much less progressive.

What started as a Roosevelt-style New Deal of both social and industrial investment is now much more the latter than the former. Reeves’s plan starts off even weaker: unlike Biden, Reeves rejects increased taxes on corporations and the rich to help fund her scheme.

There are roughly four changes we should watch for as Reeves’s plan comes under pressure.

Firstly, the size — will it be £28bn per year? There is ambiguity here. Reeves actually never says this figure in her speeches. Labour’s documents are ambiguous about whether the state will invest £28bn or make strategic investments to encourage the private sector to come up with the rest.

Then there is reducing the “social content” — will it be about insulating people’s houses or insulating companies’ balance sheets?

Thirdly, the balance between responsibility and reward for the government: if the state becomes a “co-investor” in Public Private Partnerships to build battery factories or wind farms and the like, will the deals be structured to give all the risk to the government and the profit to the corporations?

Finally, there is the degree to which state-backed investments are really environmental — will all kinds of carbon-producing businesses simply get rebranded as “green?”

I think Reeves really is committed to a state-led investment scheme for restructuring and “re-shoring” British industry. Her commitment is more to supporting the corporations than society, so she will happily trim the plan herself. But she is then caught in a case of “play stupid games, win stupid prizes.”

She became shadow chancellor thanks to Starmer’s rapid turn right, which relied on the densest right-wing Labour MPs and support from the most reactionary newspapers to exclude the left.

She is in power thanks to people who won’t make a basic “borrow to invest” argument, while she has banished all the people who can.