Comeback story Ailing economy may hand Labour a win - but what then?

Opinion was divided in the Labour party after its crushing defeat in the 2019 general election. 

- Larry Elliott

Optimists thought it would take two terms for the party to have a chance of again forming a government. Pessimists thought it was doomed to permanent opposition. Yet four years on, the polls suggest Labour is on course for a thumping victory. With the Conservatives gripped by an existential crisis, Rishi Sunak could be the last Tory prime minister for a long time to come.

Publicly, Labour's position is that nothing is being taken for granted. Privately, though, plenty of attention is being paid to what sort of economy Keir Starmer will inherit if he gets the keys to Downing Street.

Clearly, not an economy in rude health, because if that were the case Labour would probably be looking at a fifth successive defeat.

Governments that preside over strong growth and rising living standards are usually re-elected.

That's not always the case, but it is this time. The economy as the next election approaches has more in common with the stagflation nation that Ted Heath handed over to Harold Wilson after the February 1974 election than the largely crisis-free Britain bequeathed by John Major to Tony Blair in 1997.

There is, though, a difference between 1974 and today. When Wilson won his third election, the crisis triggered by the quadrupling of oil prices was in its early stages. Inflation did not peak until the summer of 1975.