Steph and Pesto are both carrying reports of Osbourne's recent speech which, if they are to be believed, would place the Tory post election economic policy a couple of notches to the left of Labour's. A end to bankers bonuses, tax breaks for equity not debt, priority given to long term investment, that sort of thing. Nothing desperately radical you understand - I think Steph is over-egging the pudding by drawing in Will Hutton as a comparator - but certainly a break from 'the pro-financial markets at all costs' approach which characterised the Brown/Darling policy line before the crash, and very distinct from their emergency programme of recapitalising the banks since. This might just be opportunism on the Tories part of course. Or it might reflect that, as an opposition, they're not totally tied up with dealing with the crisis and/or an interparty faction fight and can afford to think in the slightly longer term.
So Labour will have to respond. How? Mandelson might want to attempt to re-run the sixties dirgisme with the state perhaps not quite 'picking' winners a la Concorde, but certainly hot housing them - think of his general line as a kind of remixed Motown Chartbusters Vol 3 of economic policy. Others - Darling? Brown? - might go along with this to some degree, but still wish to re-establish the City in something like its status quo ante form, if only to reestablish a decent corporate tax base (not that the 'old' City actually paid that much tax compared to what it earned). Think of this as the economic equivalent of, say, a SpiceGirls comeback: it was huge once, but everyone doubts it can ever happen again in quite the same way.
As for the Left of the Party - and indeed the wider Left - it does rather now behove them to broaden out from particular tactical fights - like opposing Post Office privatisation - important as these are, to seeking a coherent economic vision of the future. They need a new tune as well.