As people wake up to the prospect of Jeremy Corbyn actually being able to win the Labour leadership, the reaction has become increasingly hysterical, especially from elements of the Labour establishment.

The near panic is especially evident in its response to the strategy outlined by Corbyn’s team of economic advisers.

A small band of shadow cabinet members have lined up to refuse to serve in posts they haven’t even been offered, on the basis of objection to economic policies they clearly haven’t read. Rebukes to Labour supporters to end their summer of “craziness” also not only insult the intelligence, idealism and judgment of our party members but have simply made them more determined to challenge this heavy-handed, domineering establishment attitude.

We can tackle the deficit by halting tax cuts to the very rich and to corporations

Some commentators have also prophesied economic and electoral doom if Corbyn is elected. Let’s see if, at least on economic policy, we can return to some level of rational debate. Let’s start by tracing out where there is absolute agreement.

First, it is unarguable that no modern party leader can win an election if behind in the polls on economic competence. Ed Miliband, sadly, was proof of this truism. Second, deficit denial is a non-starter for anyone to have any economic credibility with the electorate. This was a key finding of the poll recently published by Jon Cruddas, examining why Labour lost the election.

So let me make it absolutely clear that Labour under Jeremy Corbyn is committed to eliminating the deficit and creating an economy in which we live within our means.

Where the Corbyn campaign parts company with the dominant economic thinking of both the Conservative government and the other Labour leadership candidates is that we don’t believe that the vast majority of middle- and low-income earners who didn’t cause the economic crisis should have to pay for it through cuts in tax credits, pay freezes, and cuts in essential services. Instead we believe we can tackle the deficit by halting the tax cuts to the very rich and to corporations, by making sure they pay their taxes, and by investing in the housing and infrastructure a modern country needs to get people back to work in good jobs.

We accept that cuts in public spending will help eliminate the deficit, but our cuts won’t be to the middle-and low-income earners and certainly not to the poor. Our cuts will be to the subsidies paid to landlords milking the housing benefit system, to the £93bn in subsidies to corporations, and to employers exploiting workers with low wages and leaving the rest of us to pick up the tab.

Where we also part company with the economic orthodoxy of the Conservative and Labour establishments is that alongside tackling the deficit we also believe that we need an economic strategy to tackle the underlying flawed fundamentals of our economic system.

While our opponents wrongfully describe anyone who disagrees with their austerity programmes as deficit deniers, they themselves seem to be crisis deniers. They fail to understand that the unregulated, law-of-the-jungle market system they advocate is inherently crisis-ridden. Unless we act on these fundamental flaws we really do doom the next and future generations to further inevitable crises.

In fact all the factors that caused the 2007-8 crisis are currently reappearing on the scene – frozen or low incomes, low productivity, asset inflation especially in housing, a hands-off government turning a blind eye to loose credit expansion and City speculation, and a growing debt bubble.

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Just like 2007 all it needs is a spark like Northern Rock to set things off again. The rehypothecation taking place in the bond markets could be the trigger this time, when the US starts unwinding its quantitative easing programme.

So alongside deficit elimination, the Corbyn campaign is advocating a fundamental reform of our economic system. This will include the introduction of an effective regulatory regime for our banks and financial sector; a full-blown Glass-Steagall system to separate day-to-day and investment banking; legislation to replace short-term shareholder value with long-term sustainable economic and social responsibilities as the prime objective of companies; radical reform of the failed auditing regime; the extension of a wider range of forms of company and enterprise ownership and control including public, co-operative and stakeholder ownership; and the introduction of a financial transactions tax to fund the rebalancing of our economy towards production and manufacturing.

Public ownership does have an important role to play, but this will be through smart forms of 21st-century common ownership and control. For example, rail will be renationalised, but with a form of joint management involving workers and passenger representatives. Energy would be socialised from below by the massive expansion of renewable energy production and supply by local communities, local authorities and co-ops on the successful German model, removing the monopoly of the big six energy companies.

Conservatives claim they are “one nation” Tories when they have actually been a government for the 1% who have undermined our economic interests through their greed.

Politicians have patronised and talked down to us all when it comes to our economy, but ordinary working people have to manage on incomes significantly lower than the likes of George Osborne and his friends in the City. They could teach the bankers and many commentators a thing or two about managing a budget responsibly. Given the opportunity, we will use the sound common sense of our people.