Finding direction

By David Purdy

Since the post-war settlement was overturned and capitalism was unleashed via the neoliberal revolution of the 1980s, profound transformations have taken place in politics and power. The development of mass parties that accompanied the rise of representative government in the late nineteenth century reached its apogee in the mid-twentieth century. Since then, party membership has declined dramatically and the correlation between social class and voting behaviour, never all that close, has loosened still further(1). Falling party membership has weakened the links between civil society and the state, turning politics into a game for professionals and feeding the popular perception that government is now the preserve of a political class or cartel, remote from ordinary citizens and dedicated to the pursuit of its own interests.

Traditional, class-based parties have been forced to reach out beyond their shrinking pools of core voters, transforming themselves into “catch-all” parties more concerned with accommodating popular preferences and views – as revealed by pollsters, focus groups and big-data analysts – than with winning hearts and changing minds. The soliciting of votes has come to resemble the selling of commodities, an assimilation aided by two widely held, but deeply flawed ethical precepts: that the state should remain strictly neutral as between rival conceptions of the human good; and that I and no one else am the best judge of my own interests – the former a central tenet of modern liberalism, the latter an axiom of mainstream economics.

Reinforcing these trends, the creation of a global economy and the relentless advance of money and markets into every sphere of social life, from childcare and higher education to communications and sport, have diminished the importance of the public realm and, with it, the life we share as citizens. They have also curtailed the autonomy and power of national governments. The idea that taxes are the price we pay for a civilised society and that those with the broadest backs should bear the heaviest load has atrophied; monetary and fiscal policy are fenced in by pre-determined rules; and if governments, courting footloose capital, resort to cutting corporate taxes and lowering social standards, they risk provoking or intensifying a competitive race to the bottom.

Social democracy: a tradition in search of a project

These twin transformations – in politics and power – have posed severe problems for labour movements, not just in Britain, but throughout the advanced capitalist world. Following the great schism in the international socialist movement brought about by the First World War and the Russian Revolution, social democratic parties embraced electoral-legislative politics aimed at using the regulatory, fiscal and reforming powers of the state to tame market forces, check the power of capital and build a mixed economy. During the “golden age” of post-war capitalism from 1945 to 1975 – in France it is known as “les trente glorieuses” – they finally got the chance to pursue this strategy, the prime example of what Eric Olin Wright calls a symbiotic model of social transformation. In some cases, the resultant historic compromise was conceived, somewhat naively, as an irreversible settlement. In the more dynamic version of the model pioneered by the Swedish labour movement, serious efforts were made to shift the balance of the mixed economy towards greater social equality and economic democracy. In Britain, the last surviving legacy of post-war social democracy is the NHS, though it may not survive much longer.

Since the end of the “golden age” and the triumph of neo-liberalism, social democrats – and indeed the left in general – have failed to develop a viable counter-hegemonic project, even after becoming sole legatees of the socialist tradition following the collapse of communism. For a while, during what a former governor of the Bank of England dubbed the NICE age because the years from 1992 to 2007 were marked by “non-inflationary, continuous expansion”, New Labour won successive electoral victories under the banner of the “Third Way”. This policy paradigm, according to its advocates, transcended the old division between left and right and showed how to reconcile the (alleged) virtues of competitive markets – innovation, flexibility, efficiency and growth – with an updated interpretation of social justice that called for social inclusion, equal opportunity, public service reform, work-based social policies and measures to “make work pay” such as a national minimum wage and income-related tax credits.

New Labour’s efforts to humanise neoliberal capitalism were sunk by the financial crash of 2007-8 and the ensuing economic slump. To be sure, governments around the world responded to the crisis with co-ordinated emergency action to shore up the banking system and pump-prime the real economy. But this echo from the Keynesian past was soon drowned out by the resurgence of fiscal conservatism. The crash had toppled a central pillar of the neoliberal temple – the notion that the financial system needs nothing more than “light-touch” regulation – but the edifice as a whole was still intact and in the name of repairing the public finances, governments across Europe set about dismantling what remained of the welfare state.

In Britain, Labour failed to defend its response to the crisis and allowed myths peddled by the Coalition government to become embedded in public consciousness: that Labour had mismanaged the public finances during the boom years, allowing public spending to run ahead of tax receipts; that the sharp rise in the budget deficit from 2007-8 to 2009-10 was the cause rather than the consequence of the recession; and that without prompt and sustained action to reduce the deficit, chiefly through cuts in public spending, the country would face a Greek-style sovereign debt crisis. The party has paid a high price for these failures, not just in the sense that, to everyone’s surprise, the Tories managed to win the 2015 election, securing a small parliamentary majority with only 37% of the votes; but more critically in the sense that Labour’s long-term survival is now in doubt. For in a context where nothing has been done to restore public faith in Britain’s political institutions, the rise of Ukip, the SNP and the Greens as “challenger parties”, channelling popular antipathy to the “political class” and bent on breaking the two-party system, undermines Labour’s long-standing claim to be the only electable alternative to the Tories.

The election of Jeremy Corbyn as Labour leader has sharpened this threat, bringing left-wing populism into the heart of the party and opening up a division between the PLP and the party membership that could easily split the party, whether through an SDP-style defection on the right, the formation of an ILP-type breakaway on the left, or some combination of the two. Some may welcome a schism as the prelude to a wider political re-alignment, but they should be careful what they wish for. If Labour goes the way of the Liberals after 1918, the most likely consequence in the short-to-medium run will be another Tory victory at the next Westminster election, followed by a second Scottish independence referendum and the break-up of Britain.

The trouble with radical populism

In Politics as a Vocation, Max Weber argues that successful political leaders require two qualities that are hard to combine: passionate commitment to a cause and a sense of proportion or political realism. Radical populists, whether of the left or the right, are strong on vision, but prone to wishful thinking about the constraints and difficulties they face in carving out the future they announce. A good example is the prospectus on which the SNP campaigned in the 2014 Scottish referendum. The party’s leaders maintained a diplomatic silence about their pre-crash enthusiasm for RBS and the Irish Celtic Tiger; refused to acknowledge that the currency question was fraught with difficulty; remain, to this day, in denial about the probable size of the budget deficit in an independent Scotland; and still appear to believe that it is possible to finance a Swedish welfare state with US tax levels. More generally, the SNP continues to insist that once the Scottish government acquires all the fiscal and regulatory tools that come with independence – apart, of course, from those surrendered for the sake of agreeing a formal currency union with the rest of the UK – Scotland will sail serenely into an age of faster growth, full employment and strong public finances.

This is, to say the least, a questionable claim. If governments could raise the long-term rate of growth of real income per head simply by flicking a fiscal switch or re-setting a regulatory code, one wonders why they have not done it before. There are, of course, other, political and cultural arguments for Scottish independence. But the SNP made the economic case central, and with good reason, for this was what mattered most to undecided or pro-union voters, and unless they were won over, there were simply not enough true believers to carry the day.

If they are to be effective, proponents of radical reform, whether they seek to take over the commanding heights of the economy, introduce a Basic Income, launch a New Deal or found a new state, must answer three questions: Is what they propose desirable? Would it be viable if, somehow, it could be achieved? And is it achievable taking into account the prevailing balance of power and the prospects for changing it? These questions form a hierarchy in the sense that if something is not desirable, there is no point in discussing it further; and if, though desirable, there is good reason to doubt whether it would work, there is no point in trying to achieve it. But in general, all three need to be considered, though each calls for a different kind of investigation. Questions of desirability such as what kind of life is best for human beings and what kind of society would enable them to enjoy it belong to the domain of moral and political philosophy and utopian social theory. Viability is an empirical question to be examined by invoking concepts, theories and evidence drawn from historiography and the social sciences, and sometimes from the natural sciences too. And whether a proposal is achievable is a matter of political judgement about the prospects for changing the balance of forces over some specified timescale.

Time matters in politics because, as Keynes famously complained of equilibrium economists who assure us that in the long run when the storm is past, the ocean will be flat again, in the long run we are all dead. Under the press of time, we must rub along as best we can, leaving questions of philosophy and science for another day. For the foreseeable future, the fate of the Labour party is bound to loom large in any discussion about how to achieve an anti-Tory majority at the next Westminster election and beyond that, how to make the UK a fairer, greener, happier, more democratic and less disunited kingdom embedded within a reformed European Union.

From 1918 when it became a membership organisation to the days of Blair and Brown, Labour dominated the British left, enjoying a near-monopoly of electoral politics thanks to a first-past-the-post voting system that endured not so much because of its virtues as because the parties could not agree on a remedy for its faults. With the eclipse of class politics and the rise of parties concerned with national autonomy and the future of the planet, Labour faces competition on the left – as well as on the right from Ukip – and can no longer argue that the only alternative to a Tory government is a Labour majority in the House of Commons. Indeed, Labour cannot now form a government at Westminster without the support of these parties: to pretend otherwise merely invites incredulity and scorn.

It is, therefore, in Labour’s interest to re-open the debate about electoral reform. It could, for example, propose an all-party convention to consider alternatives to first-past-the-post, with a view to reaching a consensus on a replacement to be put to voters at the next election. If the Conservatives refuse to attend, they risk becoming isolated, for the other parties have every reason to take part. There is, of course, no guarantee that a consensus would emerge, but if, as seems likely, the Tories are alone in defending the status quo, an anti-Tory bloc might form, including Ukip and the Lib Dems. This would set the stage for an electoral showdown, opening up debate about wider constitutional issues. The general point is that political realignment sets up pressure for political reform and unless Labour takes up the cause of reform and thereby renews itself, it may not survive at all.


1. It is, however, worth noting that in Britain the preponderance of Conservative voters among the haute bourgeoisie and middle class has always been many times greater than the preponderance of Labour voters among the more numerous working class, a fact that goes a long way to explaining why the Tories have been in government, alone or in coalition, for 40 of the 70 years since 1945.

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