Ed Balls may not have been elected Labour leader, but over the past few months he has certainly emerged from under Gordon Brown’s wing. Tribalistic, pugilistic, Balls is something the Westminster commentariat keep telling us that people don’t like. But in terms of taking the fight to the enemy, Ed Balls has thus far shown himself to be one of the most effective Labour battlers. Anyone who watched his serial demolition of Michael Gove cannot fail to have been impressed.  Quicker, and more energetically, because his arguments are rooted in economics, he has distanced himself from some of the market crudities of New Labour, earning himself soubriquets from serious economics writers, Martin Wolf and Sam Brittan. This is no mean achievement for a man who came pretty close to losing his seat at the General Election, it also probably explains why Ken Livingstone emerged as such a strong Ed Balls supporter.

Balls has of course written for Tribune for some years, and in a less heavy, ponderous style than his old boss, Gordon Brown, whose copy often appeared to have been drawn up by a committee. Balls and Brown were famously suckered by the US Chairman of the Federal Reserve, Alan Greenspan into believing in something called ‘endogenous growth theory’, which for historians may yet come to be compared to ‘Scientology’, with the idea that growth could continue exponentially based on services, house price inflation and the collected wisdom of the bankers.

The wake-up call came with the collapse of the bankers bubble, and fortunately Brown, Darling and Balls were at the helm. Had the Labour Government not rescued the banks from their own venality, Britain would have plunged into a deep depression. Let it not be forgotten that Cameron and Osborne opposed the Government’s massive intervention, and would now like voters to believe that Labour, rather than the bankers, were to blame. The Left has fairly consistently argued for a return to Keynesian policies, ever since Margaret Thatcher unleashed Monetarism and destroyed much of Britain’s manufacturing base. However, until the crisis, the Left was ignored as successive Government’s signed up to neo-liberal economics and allowed the market and the banks free reign. Now we are paying the price, although as Ed Balls may point out, the millionaire Con-Dem Cabinet will be the last to pay any price stuffed as it is with millionaires who largely benefitted from casino Capitalism.

If our descent into a long period of Japanese deflation has been delayed, it is because of the pump priming effects of the Labour Government which still linger. But now we face the precipice, deep and savage cuts, almost unprecedented, that will hit public and private sector alike, and substantially reduce demand and end any real prospect of economic growth. Virtually no one talks about the balance of trade any more, but a quick look at Britain’s trade figures shows that Cameron and Osborne’s idea that we can export ourselves out of recession is so much moonshine. Britain simply no longer has the capacity.

So what needs to be done? The starting base is that Britain could soon find itself heading in the opposite direction of Germany and France, countries that do have diverse economies and sensibly eschewed the Anglo - American model. More likely Britain will mirror what is happening in the United States, a country without a safety net, a safety net Cameron and Osborne are set to savage here.

On the evidence of his performance since Labour went into Opposition, Ed Balls must surely be the best candidate to take Osborne on, relentlessly exposing the vandalism of the Coalition Government, and also beginning to set out a Labour alternative. For it will not be enough simply to expose, parry and attack, voters will want to know how a rejuvenated Labour Party intends both to move on from a fairly inglorious worshipping at the altar of the Market, and what Labour would do differently.

And as Balls himself recognises, Britain can no longer act alone. This is a very real weakness of David Cameron, possibly the most insular Prime Minister Britain has had since the Second World War. Cameron – and Osborne have little interest in the outside World and their views on Europe have been shaped by myopic ‘little Englanders’ on the Right who committed the Conservatives to aligning themselves with some of the most reactionary forces on the Continent, simply because these allies were also ‘anti European’.

Should Ed Balls emerge as Shadow Chancellor, which is what many people in the Labour Party are hoping may happen, he will have an enormous opportunity to reach out to Sister parties in Europe, some of whom, especially in France and Germany stand a real chance of power. In the same way that Jacques Delors reached out to the trade unions and the British left during the 1990s, and formulated an alternative to joblessness and low wages, Balls may be able to foster a new relationship with the Party of European Socialists, even now beginning to prepare a Manifesto, whose pan-European reach on employment, growth and financial sector reform, could actually give it some meat.

What is really needed is a European ‘Alternative Economic Strategy’, an intravenous drip of new pan European economic policies designed to revive European Social Democracy. And how better to begin for Ed Balls, should he become Shadow Chancellor, than to convene a conference with his opposite numbers in the French Socialists and German SPD in London, to begin to thrash out an alternative strategy to the scorched earth policies of the ‘little Englanders’ who populate the Con-Dem Front Bench.