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Leadership elections are often a moment of catharsis for a political party; a chance to turn a new leaf. Not so for Labour. Jeremy Corbyn will be re-elected on Saturday but Labour’s civil war, like the red eyed storm on Jupiter, will rage on.

Corbyn’s carnival

Owen Smith’s challenge never got going and his Corbyn-lite strategy palpably failed to gain any momentum. That, organisationally and metaphorically, is all with Corbyn, and the movement of that name will be visible in Liverpool next week through its “World Transformed” festival.

That festival will take place in the streets around Labour’s conference centre, giving delegates and non-delegates alike the chance to hear from such left-wing luminaries as Owen Jones, Billy Bragg and Paul Mason. The latter is well and truly off the leash since leaving political journalism, recently recalling the American Civil War leader, General Sherman, when he warned moderates that “You’ve chosen war. We’re going to give you all the war you can take.”

Division and despair

Mason was somewhat out of tune with the official Corbynite line, which is that Labour should now come together. But that is easier said than done. The leadership election has left the party more bitterly and indeed violently divided than it was before.

Many members of the parliamentary party will not be in Liverpool, some for reasons of personal security. Labour MPs are in a state of despair. They fear the contest has made Corbyn stronger and the party’s position even more hopeless. Recent by-elections in local government have seen Labour lose seats on enormous swings to the Liberal Democrats. In Scotland the party appears dead and buried. In normal times that alone would be a source of deep angst, questioning Labour’s ability to form a UK government. In the current context it is but one aspect of a wider existential crisis.

Corbyn’s victory will intensify the soul searching. Moderate Labour MPs face a dilemma. Do they split? Do they return to the fold? Or do they fight again?

Will Labour split?

Many are privately weighing up whether the party has a future. There is certainly no shortage of pundits urging them to abandon ship and form a new progressive party. But that is very unlikely to happen on 25th September. For now, there is little appetite to precipitate a split. Tribal bonds run deep inside Labour and many are mindful of the infamous Gang of Four and the failure of the SDP. The vast majority of moderate Labour MPs do not wish to surrender the party to the hard left.

So what happens next?

It seems more likely that Labour moderates will stick it out. The civil war will go on but in the form of low level conflict and ongoing sniping. While a minority of hard line opponents may still push for another tilt against the leader, most believe the recent challenge failed dismally and will be mindful that 150,000 new (largely pro-Corbyn) members who were excluded from the current ballot will be eligible next time.

Furthermore, with boundary changes coming up between now and 2018 Labour MPs will be subjected to a process of local selections. That will encourage most to concentrate on their own survival above the wider struggle.

These developments reduce the prospect of full scale confrontation in the coming months. Some moderate MPs may even return to the frontbench. While the likes of Hilary Benn, Heidi Alexander and Owen Smith are beyond the point of return, others including Lucy Powell, Dan Jarvis and Gloria De Piero are believed to be prepared to do so.

Has Corbyn’s high tide passed?

Whether they do so may hinge on talks between Corbyn, the Deputy Leader, Chief Whip and PLP Chair on a new system for selecting the front bench. That follows moves by Tom Watson to get Labour’s NEC to back a return to shadow cabinet elections. Although Corbyn successfully resisted that immediate pressure, the fact he was nonetheless moved to commit to talks is an interesting development which reflects a realisation on his part that he will have to deal with the PLP if he wants to form even a semi-functioning parliamentary opposition.

Perhaps more significantly, the same NEC meeting resolved to give the two Welsh and Scottish representatives’ full voting power. With the pro and anti-Corbyn blocs finely balanced, this change may give the moderate wing a slender but critical majority on the ruling body. While that will not result in any sudden change, it means Corbyn will be prevented from purging party staff or rewriting party rules. That, alongside his loss of support in certain key unions, has provided a glimmer of hope to some on the moderate wing that Corbyn may have reached his high tide.

Electoral reckoning

As things stand, the party is locked into a conflict in which neither side is yet strong enough to win. Corbyn is on course to lead Labour into a 2020 general election. Events could yet change that. If local elections and parliamentary elections continue to point towards a catastrophic loss of popular support then MPs may be moved into drastic action. But for now the most likely scenario is that Corbyn will survive; propelled forward by a massive membership which, as Frank Field notes, works as a reflective shield around the leader but fails as a bridgehead into the electorate. The real day of reckoning may not come until the wave of Corbyn-mania reaches landfall in the form of a general election. Only then might it fall apart.

What does it mean for business?

Corbyn’s likely re-election means that Labour will remain a deeply divided and dysfunctional party. While the return of some moderate figures to the shadow cabinet, if it were to happen, might alter the dynamics slightly, there will be little incentive for business to seriously engage and little desire among the Corbynite leadership for it to do so.

That said, the party is not totally irrelevant. At local government level Labour remains a significant force and in the context of devolution and the Northern Powerhouse, which George Osborne has prompted Theresa May to vocally support, Labour mayors and council leaders will play an important role.

And finally, Labour will have an influential voice in the debate around Brexit. On this, one of the most noticeable developments in recent days is the emphasis that moderate MPs have been placing on the need to secure controls on freedom of movement as part of any Brexit deal. That will do little to help the cause of those seeking to persuade the Prime Minister that single market access is paramount

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