How can the British left respond to the cost of living crisis? Lessons from Portugal
Labour Budget Boosts Inflation & Unemployment
Britain’s finance minister, Rachel Reeves, delivered her November 27 budget promising fiscal responsibility while the Office for Budget Responsibility forecasts unemployment rising to 5% and inflation persisting through 2026. The measures offer modest relief: £150 off energy bills, National Living Wage increases, pension rises under the Triple Lock. But tax rises will push the burden to a post-war high, and real household income gains remain marginal.
This is precisely the kind of “competent management of capitalism” that destroyed the Portuguese Left between 2022 and 2025. The parallel is almost exact: a social democratic government prioritising deficit reduction during a cost of living emergency while the radical left offers “constructive opposition.” In Portugal, this strategy handed 18% of the electorate to the far-right.
The Portuguese Collapse
Between 2019 and 2024, Portugal’s Bloco de Esquerda fell from 19 parliamentary seats to 5. This happened during the worst cost of living crisis in decades: workers lost the equivalent of a full month’s salary in purchasing power during 2022, housing prices doubled over a decade while wages stagnated, and 22.4% of the population faced poverty or social exclusion.
The Socialist Party government responded with what the Rede Anticapitalista, a current in the Portuguese section of the Fourth International, called “disguised austerity.” The PS refused to tax extraordinary profits from energy companies, rejected inflation-matching wage increases for public sector workers, and prioritised what they termed “contas certas” (accurate accounts) for Brussels over income protection. When the Bloco proposed raising public sector wages in line with inflation, the PS voted it down alongside the liberal Iniciativa Liberal.
The Bloco’s programme addressed these failures directly. Their 2024 manifesto proposed rent caps, taxes on large fortunes, and windfall profit levies on energy companies. They were saying the right things. They still lost.
The Institutional Trap
The most searing analysis comes from within the Bloco itself. The internal opposition, organised around Motion E at the party’s conventions, argued that “institutionalisation of the party, characterised by an almost exclusive emphasis on parliamentary initiative,” was the root cause of decline. They accused the leadership of accepting a “secondary role for popular struggles” as a deliberate strategic choice prioritising “legislative negotiability over street credibility.”
The outgoing coordinator Catarina Martins acknowledged part of this diagnosis. She identified the PS’s subsequent absolute majority as stemming partly from “the dazzlement of some sectors with institutional negotiation in place of public confrontation and social movement.” Her successor Mariana Mortágua, elected in 2023, promised a “programme of rupture with liberalisation and social fragmentation.” But the opposition accused her leadership of a “fuga para a frente” (flight forward), refusing to hold an open convention to discuss the defeat: “The Secretariat does not want to face with democratic humility this new and profound electoral defeat, preferring to delay the balance and responsibilities.”
The Bloco’s communication reinforced the problem. While the Vida Justa movement was demanding basic survival goods in the Lisbon peripheries, the Bloco was filing motions in the city council asking for clarifications on protest routes. Necessary work, but it confirmed the image of a party obsessed with the machinery of the state rather than the condition of the people.
What Chega Did Differently
The far-right Chega surged from 1.3% in 2019 to 18.1% in 2024. They succeeded by weaponising the crisis through what analysts describe as a “populism of resentment.”
Chega executed a strategic pivot. While economically neoliberal on paper, their rhetoric became fiercely protectionist for the “deserving” Portuguese. André Ventura demanded higher pensions for the elderly (contrasting them with “subsidised” foreigners), public housing investment for the “middle class,” and an end to “shameful” politician pensions and subventions.
This approach allowed Chega to steal the left’s clothes. They acknowledged the pain of the housing crisis but framed it as a result of “corruption” and “immigration” rather than capitalism. By proposing measures like deducting housing costs from income tax, they offered tangible, albeit regressive, relief that sounded like direct action to a desperate population.
The electoral replacement was direct. Chega broke into the “Red Belt,” the industrial and agricultural heartlands of Setúbal and Alentejo that were once Communist and Bloco strongholds. These voters did not become fascists overnight. They became furious that the left parties were seen as propping up the status quo while their rents doubled. The dam holding back the far-right had burst; the electorate under 55, particularly men, abandoned the left for Chega.
The Independent Movements
Perhaps the most uncomfortable finding concerns the relationship between the parliamentary left and the social movements that actually mobilised people.
Vida Justa emerged from the racialised, impoverished neighbourhoods of the Lisbon periphery: Cova da Moura, Zambujal, communities routinely overlooked by politicians. It was a direct response to the price of basic goods like gas canisters and food, led by community organisers like Flávio Almada.
Vida Justa explicitly distanced itself from the Bloco. “We have nothing to do with the Bloco... we are not contemplated in those budgets,” stated organiser Nuno Ramos de Almeida. They viewed the institutional left as absent from the daily survival struggles of the bairros. Their strategy focused on immediate material demands, mobilising people who had never attended a political meeting.
Casa para Viver, the housing platform that organised the massive demonstrations of 2023 and 2024, brought together over 100 collectives. While the Bloco supported them, the energy was independent. The platform’s success proved that the desire to fight existed. The people just didn’t want to fight under a party banner they associated with the system.
The Rede Anticapitalista noted that the Bloco was often “a reboque” (being towed) behind events rather than driving them. This is the central indictment: a party that was correct on policy but absent on mobilisation, that filed the right motions but ceded the streets to movements that refused its leadership.
The UK Bridge
The parallels with Britain are striking. “Enough is Enough” in 2022 mirrored Vida Justa: trade union-backed, initially mobilising huge numbers, struggling to sustain momentum because no political vehicle was willing to embrace its radicalism fully. In Britain, the Labour leadership actively suppressed support for the campaign. In Portugal, the Bloco tried to “support” Vida Justa without understanding that the movement was a rejection of its institutionalism.
Keir Starmer and António Costa share a political DNA: commitment to fiscal orthodoxy and a belief that the left wins by occupying the centre. The Portuguese lesson is clear. When the centre-left governs as “competent managers of capitalism” during a crisis, they may survive temporarily, but they hollow out their own base, opening the door for a populist right that promises to burn the house down.
The November 27 budget is classic centre-left crisis management: modest relief measures wrapped in fiscal discipline, tax rises to meet borrowing targets, promises that inflation will fall and growth will return. The Portuguese experience suggests this is precisely the wrong approach if the goal is preventing far-right advance.
Strategic Lessons
First, correct policy positions are insufficient. The Bloco’s programme addressed the crisis accurately; their electoral results did not follow. The party’s own Mesa Nacional acknowledged after 2024 that their policy proposals “did not lead to electoral recovery.” Having the right analysis does not automatically translate into political advance, particularly when the far-right offers a more emotionally compelling narrative of grievance.
Second, institutional orientation carries fatal costs. The opposition’s diagnosis of “almost exclusive emphasis on parliamentary initiative” echoes debates within British left formations about the relationship between parliamentary work and movement building. The Rede Anticapitalista’s critique of “defensive posture” and operating within acceptable political parameters suggests that this approach fails to generate the support necessary for breakthrough.
Third, independent movements may be more effective mobilisers than party structures. Vida Justa’s success in reaching populations the parliamentary left had failed to engage, and Casa para Viver’s capacity to change political discourse by operating outside party constraints, raises uncomfortable questions about organisational forms. These movements built alliances that excluded no one and mobilised people who had given up on politics entirely.
Fourth, do not cede “anger” to the right. Chega won because they were angry. The Bloco lost because they were “concerned.” Technical solutions to the cost of living are necessary, but they must be wrapped in a narrative that identifies enemies, names the profiteers, and mobilises emotion rather than explaining spreadsheets.
Fifth, the “constructive opposition” trap is a death sentence. By prioritising amendments to PS budgets, the Bloco legitimised a system that was crushing their voters. The Geringonça saved Portugal from austerity in 2015 but killed the Bloco in 2024. Tying your fate to a neoliberal centre-left party is a suicide pact.
The Portuguese left did not “miss” the cost of living crisis. They engaged with it seriously, proposed coherent responses, and connected with social movements. They still lost ground while the far-right advanced. Understanding why requires examining not just what the left said, but how effectively it translated social frustration into political power, and whether its organisational forms were adequate to that task.
Britain’s left faces the same test. The budget just delivered offers the same “responsible management” that failed in Portugal. The question is whether British organisers will learn from Lisbon’s catastrophe or repeat it.