THE Labour government is in turmoil and open warfare has broken out on the right of the party.

The immediate cause of the disorder is the outcome of the Caerphilly by-election, where Labour was trounced.

For the current Labour leadership the result was even worse, as it exploded all the comforting myths that have recently been peddled; that the next general election would be a straight fight between Labour and Reform UK, and given Reform UK’s deep unpopularity among 65 to 70 per cent of voters, then Labour would inevitably win.

In reality, Labour is a mile behind Reform UK, while the genuine unpopularity of Nigel Farage and his crew coalesced around Plaid Cymru. Labour has done nothing to ensure that it is the main beneficiary of the genuine anti-Reform sentiment among most voters.

It is this that has caused the recent ruptures and the impending and widely trailed draconian Budget have deepened the sense of foreboding.

But these are only the immediate events. As some of us have argued for some time, the entire line of the current leadership is leading Labour to disaster. The country’s economic and social crises are deepening because of its policies and the main beneficiary has been the snake-oil salesman, blaming everything on migrants (which should also confirm that he does not intend to address any of those problems, let alone correct them).

The potential loss of seats has concentrated the minds of my colleagues, even if their responses are not always constructive ones. But it is quite foolish for anyone inside the Cabinet or beyond to believe that all that this government is lacking is their own unique combination of charisma and competence to turn everything around.

The multiple crises this country is facing are policy-driven. Only a root-and-branch return to something recognisably Labour in every area of government policy stands any chance of rescuing the country or saving Labour’s fortunes and prevent handing the keys to No 10 to Farage. Because that remains our current course.

Of course, in one sense, my colleagues have learnt the lessons of the deputy leadership campaign. The bulk of the membership of the Labour Party wants it to go in a centre, or centre-left driven direction. That is why Lucy Powell won.

As a result, we are now treated to the sight of prominent ministers talking about the issue of racism, when that word never normally passes their lips. Or they have found reasons to criticise Israeli government actions, without ever taking any action to prevent them recurring. Or, amusingly, they fall over themselves to congratulate Zohran Mamdani on his great victory in the race to become New York’s mayor, even though, as many have pointed out, he would undoubtedly have been expelled under this Labour leadership. One Cabinet minister went so far as to claim it was a victory “for the many, not the few.” Shameless.

They seem to be calculating that the Labour membership will forget the minister’s entire political history and will be judged instead on their last couple of tweets.

But, while the membership may have little choice (we shall see) that is not true of the voting public. They do have choices, as Caerphilly and the opinion polls shows. If a genial new demeanour is the new figurehead for the same Labour policies, they should expect the same result in those polls.

Without radical change, all the current ambitions amount to is where on the list of shortest terms as prime minister they will land — better than Liz Truss surely, but better than Rishi Sunak only hopefully.

In fact, the revolving door at No 10 which long precedes this government is being spun by fundamental forces, chiefly economic ones, but also encompassing all key aspects of government policy. It is the deep public dissatisfaction with those policies, and their continuity that is the motor.

Voters are heartily sick of austerity. Yet Starmer is criticised by the “quality newspapers” because he cannot push through more of it.  

Austerity has been imposed for nearly a generation now, and it has not worked. Between crises, the economy is almost stagnant, prices go higher and pay is only ever playing catch up and now unemployment is starting to rise.

A year ago, the Chancellor and the Prime Minister told us a harsh Budget was necessary (and the freeze on income tax thresholds was the harshest measure of all) because of a £22 billion hole in government finances bequeathed by the Tories. Tough choices were made and the economy slowed even further, now leaving a £30bn hole in government finances.

Austerity clearly does not work, certainly not in terms of leading to growth or even an improvement in government finances. It is the first policy that should go.

The alternative is staring at us. Weak growth has led to increasing pressure on public services, just as the government warned and vowed to correct. But bleeding the patient has only left it weaker.

Instead, we need growth, led by investment. Again, this is just as the government said. But, its wholly reliant on the private sector has which has failed to deliver on its side of the bargain for 15 years. It is failing now on housebuilding. The public sector should step and borrows at very cheap levels (less than 1 per cent in real terms) to grow the economy. There is no shortage of investment needed in affordable housing, transport, infrastructure, technology, renewables and in education.

Meanwhile, government should address the multiple failings in public services with proper funding through taxation. Of course, this should be taxes on big businesses (removing unproductive subsidies) and the genuinely ultra-wealthy.  If nurses, train drivers and experienced teachers are being caught in your tax net, you are imposing austerity on ordinary workers.

From this, there should be a cease-and-desist order on fomenting all types of divisions in society, beginning with the racism aimed at migrants and asylum-seekers, and the outrageous slanders on Muslims and the black community. No Labour government should ever deal in scapegoats, or clamp down on our rights, or criminalise protest. Any government genuinely committed to delivering rising prosperity has no need of scapegoats.

A complete reversal of foreign policy is also needed. We should end all cover for and practical support to Israel unless and until it commits to ending the genocide and occupation, and its perpetrators face justice. We should end the subservient role to a warmongering US and refuse to go along with either its wars or Trump’s demands that we further damage our own economies through increased military spending.

A genuine sovereignty in the diplomatic, trade and military spheres would be very welcome.

If a contest does emerge for Labour leadership, these are the types of demands the left should make in return for supporting any candidate.

Diane Abbott is Labour MP for Hackney North and Stoke Newington.