What happens when your economic policies rely on a booming City of London and you're suddenly faced with a banking crisis and a credit crunch?
That's the dilemma facing the Labour government. It is also hitting Ken Livingstone in his mayoral contest, with Boris Johnson, the right wing Tory, ahead in recent polls. Many believe that the contest will be decided on transfer votes as the smaller parties' second preferences are divided between the two main candidates.
The contest will be the most important in London for years. The collapse of US bank Bear Stearns, the billions of pounds the Bank of England is lending to other banks to stop the credit crunch, the predictions that British house prices will fall even further than those in the US, Ireland and Spain, are all adding to a sense of crisis.
This is not good news for Ken. His support for the City of London as the motor for a booming London economy had its problems during times of boom. It meant stroking the sensibilities of the City bankers, not standing up to them. It meant accepting a growing level of inequality in one of the richest cities in the world. It meant the property developers getting their own way to build unaffordable housing with only a few crumbs thrown to those who couldn't afford it.
The wealth still didn't trickle down. Now working people in London face economic devastation in many cases. House prices will fall, new buyers will not be able to obtain mortgages and those who lose jobs or face lower wages will be threatened with repossession. Already many people are asking how they can afford to live in London, faced with higher transport, gas, electricity and food prices, while being denied pay rises reflecting inflation.
Livingstone has few answers for this. He has locked himself into a strategy reliant on economic expansion and on developing East London through the Olympics, and he doesn't have a plan B. One of his economic advisers, John Ross, boasted in a recent Economist article which compared London with Paris that London had already won the battle over Paris and could now only be seen in competition with New York.
The election should be a time when left candidates put forward alternatives to the crisis and demand that workers should not have to bear the brunt of it. That's what I'm doing in my campaign for Mayor as part of the Left List. We have always argued for an emergency programme of council house building to ease the housing crisis. Now we need to add to that the demand for no repossessions, for councils to take over empty flats or unsellable blocks, and to stop banks charging more for credit.
There should be higher corporation tax, windfall taxes on the utility companies and a ban on price increases from these privatised monopolies.
There are many people in London who agree with these arguments and who will vote for a left alternative if it is put to them. It is easy enough to find them. They are campaigning against schools being turned into city academies, and library and pool closures, for better wages for teachers and civil servants and against the war in Iraq. Labour no longer represents them, and although Ken still has many good policies around issues such as racism and equality, he has done too little to address many of these issues.
It is no wonder that a journalist who recently interviewed traditionally Labour-voting Londoners found that, while they knew Ken had done some good things, they couldn't think what they were.
Ken could still come out fighting on some of these issues, but it doesn't look as though he will. Instead he seems to be sticking to the same script despite everything else changing. His policies in many regards are very similar to those of Boris Johnson. The danger is that this plays into Johnson's hands, allowing him to appeal as fresh, new and even radical compared to Ken. That would be a disaster for London.
Some people have argued that I shouldn't stand, and should leave the field clear for Ken. I always rejected that argument because there are two votes in the election and I'm calling for a transfer to Ken. But the mayoral contest helps give a high profile to our list, and if we win 5 percent we gain a seat on the London Assembly.
It seems to me today that not standing would have been a serious political mistake. Out of what appear to be 13 candidates for mayor, only three can be called left wing: Ken, the Greens and me. Out of those I am the only one putting forward policies which can point a way out of the crisis and appeal to trade unionists, ethnic minorities, pensioners and students who are fighting back. A left voice in this election is not a luxury but a real necessity.
Lindsey German is the Left List's candidate for London's mayoral elections and heads the Left List for the GLA.