Labour is telling Britain it is now a conservative party – and we should believe it

Let’s take Starmer at his word that it is the party of wealth creation and growth, not redistribution and equality. What will this mean for our politics?

We now live, despite appearances, in an age of consensus. We should perhaps call it Starnakism, a much more profound consensus than Blatcherism (the portmanteau of Blair and Thatcher) or the postwar Butskellism (Rab Butler and Hugh Gaitskell). Its most telling feature is that the Labour party’s fundamental criticism of the Tories is their lack of competence, rather than their policies.

Yet the idea that Labour remains a progressive social democratic party hiding in plain sight is still in the air. While it is granted this is not obvious from its programme, it is held that deep down it is the party of change, of welfare, of state intervention; the party of labour rather than of capital, the party of international law, not war. It is held that in power, either circumstances or opportunity will make it more radical. That hope animates many.

Yet Labour is telling the world otherwise, and we should believe it. While the Tories promise tax and welfare cuts, it offers minor increases in tax and spend, premised on cuts in other areas. Labour says it will not increase benefits, or remove the two-child cap; it will only make improvements to education and healthcare that are trivial in the context of the challenges faced, adding only marginal numbers of appointments and teachers.

It tells us it is now the party of wealth creation and growth, not redistribution or equality (that is, people at the bottom will only get more if the size of the cake increases, and they will keep the same share of the cake as before). It sees no Israeli war crimes in Palestine. It will marginally retilt capital-labour relations, which one hopes will reduce inequality somewhat, but it does not differentiate between good and bad types of business – all business is good. Brexit is accepted.

Continued in the Guardian 28 June 2024

Keir Starmer and Tory History

In December, in an article in the Sunday Telegraph, Keir Starmer made a supportive comment about Margaret Thatcher. It attracted derision from the left. His supporters responded that he was stating the obvious. But he was not. Keir Starmer made a general historical argument, here in its entirety:

‘Margaret Thatcher sought to drag Britain out of its stupor by setting loose our natural entrepreneurialism. Tony Blair reimagined a stale, outdated Labour Party into one that could seize the optimism of the late 1990s. A century ago, Clement Attlee wrote that Labour must be a party of duty and patriotism, not abstract theory. To build a “New Jerusalem” meant first casting off the mind-forged manacles.’ – The Sunday Telegraph, 2 December 2023

It is a remarkable and revealing passage. For it seems to be saying that only Thatcher and (partially) Attlee made a difference to the status quo. This runs counter to the traditional social democratic story – that Labour created something good, which Thatcher destroyed. To have this analysis from a Labour leader is astonishing (even if it was probably shared by Blair and Brown).

Continued in Red Pepper (29 February 2024)

The 'People's War'?

In 2021 I published a long article in the English Historical Review which looked at the origins of the ideas that ‘Britain was alone’ in 1940/41 and that it fought a ‘people’s war’ (‘The Nationalisation of British History: Historians, Nationalism and the Myths of 1940’). The article grew out of my 2011 book on the history of the British second world war (Britain’s War Machine) in which I had shown that if anything was said to be alone in 1940/41 it was the whole British Empire, not Britain, and that the term ‘people’s war’ had various differing meanings in the war itself, including one which claimed that Britain was not fighting such a war. In the article I traced wartime usages further and looked into when and in what senses historians came to use ‘Britain was alone’ and ‘people’s war’.

The English Historical Review, in the first of a new feature called Forum, have published three papers upholding the standard view that a particular form of understanding of ‘people’s war’ was the dominant ideology of wartime Britain (Lucy Noakes, ‘The ‘People’s War’ in Concrete and Stone: Death and the Negotiation of Collective Identity in Second World War Britain’ ; Sean Dettman and Richard Toye, ‘The Discourse of ‘The People’s War’ in Britain and the USA during World War II; and, Jessica Hammett and Henry Irving, ‘Renegotiating Citizenship through the Lens of the ‘People’s War’ in Second World War Britain’). The papers, and one in particular, that by Sean Dettman and Richard Toye, take issue with my claims about wartime usages. As part of the Forum I have responded to the multiple misunderstandings of what my paper argued and tried to make sense of this as well as pointing to the ways historians have already looked afresh at the history of the war (‘A Cliché to Be Avoided Like the Plague: The ‘People’s War’ in the History and Historiography of the British Second World War’).

Conservative hostility to net zero proves the party has turned its back on British capitalism

Of all Rishi Sunak’s blunders and policy decisions in 2023, perhaps the most consequential was his move to delay key milestones on the way to net zero. Sunak postponed the banning of sales of petrol and diesel cars and domestic boilers two months after the government authorised more carbon extraction from the North Sea. Cue outrage from the capitalists to the greens, from greens to even some Tories. What on earth was he doing?

Continued in the Guardian 22 January 2024

We need to reject the fantasy economics of the conservatives of both parties

Luca Calafati, Julie Froud, Colin Haslam, Sukhdev Johal and Karel Williams, When Nothing Works: From Cost of Living to Foundational Liveability (Manchester University Press, 2023)

 I had the very great pleasure, along with Grace Blakeley and Aditya Chakrabortty, to say some words about the above book at its launch at QMUL recently. I’ve written up my comments on this most book below.

This book represents one of the most hopeful and important developments in political economy for a long time. It points to new ways of thinking, new programmes and policies, ones with a chance of working in the new context in which we live.

It suggests a new way of knowing, of understanding the world, which means we see things differently, and we see things we did not see before.  It also suggests a new way of acting, a new politics, and one very different from that on offer from the two main parties, and from the think tanks.  Its critique is powerful and ambitious one. As the authors note:  ‘The UK system of economic knowledge production is centralised and hierarchical, so regional universities promote conformism and Celtic nationalists favour independence but so that they can more effectively deliver the consensus aims of Westminster economic policy.’ That is a stinging and powerful charge.

What they call techno-centrist and free market partisans both want more growth and higher wages (that is higher productivity). They differ in the nature of the supply-side drives they highlight – inventions and entrepreneurs, though both are typically closely linked.  To this programme are added measures to narrow geographical productivity differences, by, guess what, encouraging local invention and entrepreneurship.  This is the policy of both the Tories and Labour.  

These policies have been central for decades, yet have failed  to increase rates of growth over those of the long post-war boom and even more so the growth of incomes for the many.  Yet, not recognising this, advocates claim their ideas have not yet been tried, much like Brexiters explain the failure of Brexit to work. 

Underlying the critique is a sense that a lot of our economic ideas are left-overs from an era when industry dominated economies as well as imaginations, and where we did have high growth rates.  We are still focussed on good jobs in manufacturing, on industrial policy, on research and development when today the economy is 80 per cent services, and there are different dynamics around productivity and around imports and exports, and new problems which make the old industrially-driven growth rates not only unlikely but unsustainable.

Instead of this economics of fantasy they call for a political economy of improvement. Instead of wishful thinking about science and entrepreneurship they want to make things better based on systematic knowledge rather than the consensus of the think tanks.

So, what are the elements of this new approach?  First there is a renewal of focus on the household rather than the individual, on the distribution of household income and how it has changed over time. This leads to the realisation that broadly speaking today the single breadwinner household implies poverty for dependents, and that if we were to return to 1970s levels of equality, most households would be considerable richer.  The family wage has gone; the promises of trickle down have hidden the reality of forcing up of the share of capital of the national cake.

Second, there is focus on all sorts of incomes, and focus on essential expenditures.    What they call foundational empirics show the importance of bought essential services (from the internet to buses to food) and free services like health and education.   A startling revelation is the extent of the importance not so much of benefits (now vital to the working poor), but of free services to the poorest, which is worth more to many than either wages or benefits.  The upshot is clear – liveability depends not just on wages and benefits, but on the availability and quality of free services, as well as social infrastructures (from parks to pubs). In other words, we depend not just on money, but on infrastructures, material and human which cannot simply be bought.

So a proper economics has to be about much more than the income of individuals (even aggregated) but one of the structures people live in (households) and the multiple infrastructures which sustain life, including the foundational economy.  Improvement has to be about much more that providing more cash, it is also about the provision of services, free and paid for, and amenities of many kinds.

This kind of thinking is necessary because the effects of the market revolution, and its privatisations and drives for efficiency, have led to decrease in wages for the poorest, the fall in benefits, and reductions in the provision of foundational goods and services (free or paid).  There is thus a multiple crisis of liveability. 

But it is also necessary because of the challenges of decarbonisation.  This clearly requires action (which will be forced on the country) focussed on transforming infrastructures. It directly affects key costs and requires massive investment.  You cannot think it through as if it were a green industrial revolution, or as a programme for new R&D programmes and entrepreneurial start-ups.  It is a systemic issue which must be dealt with as such, and at the centre needs to be a multi-dimensional analysis of the households nearly all of us live in.  For the challenge is to change the housing and transport infrastructures of the many without imposing impossible costs on people.  Decarbonising electricity and making wind turbines is the easy bit.

One common and often powerful critique of radical policy proposals is that too often they in effect say: I wouldn’t start from here.  That is, they are cries of despair that we have the wrong politics and demands for a kind of politics we do not have.  Here too our authors innovate.  What shines through this book is the need to understand where we really are, and that includes not just the problem, but the possible solutions, that we really do need to start from where we really are.  And here that implies rejecting the fantasy economics of the conservatives of both parties.  That political economics of fantasy has become the British norm, spreading from Brexitism across the political spectrum, from wishing to be a science superpower, to dreaming of having the fastest rate of growth in the G7, to boasting of being a world leader in green technology.  We desperately need a more modest politics, a politics of improvement, rather than one of rhetorical excess and social misery.  And this book opens our eyes to this necessity.

Britain, here’s a plan: stop applying old fixes to new problems. And stop obsessing about growth

Crises in productivity and wealth inequality won’t be solved with ideas from the 80s. It’s not about a bigger pie – we need a different one

ccording to our politicians and most of the media, the central problem facing the British economy is a lack of growth. We need growth, we are told, to pay for this or that public service, or good wages, or housing. Just this week it was reported that the chancellor would need to plan further cuts in expenditure as a result of the Office for Budget Responsibility downgrading the UK’s growth prospects.

But we should beware framing the lack of growth as the main affliction. In any case, the solutions to the growth problem have been tried and largely failed, whether the austerity of the Cameron years, the tax cuts proposed by Liz Truss and Kwasi Kwarteng or the innovation promised by all governments since the 1990s. The problems of the present are genuinely novel, and require not so much growing the British economy as transforming it.

Continued in the Guardian (26 January 2023)

The woes of startup Britishvolt

Fake it till you make it has been the guiding maxim of British government policy for national renewal since Brexit. Don’t be a declinist remoaner, they say, instead enjoy the feeling of being a science superpower, an innovation hub, a global player, a new fount of regulation, and watch those entrepreneurs go, go, go. See them thrust into new markets as those great trade deals open up the world to British ingenuity.

In reality, the country has gone from hero to zero in a few months. The bankers are clamouring to slow the economy by pushing down wages and for cuts in public expenditure.

This is the context in which we should understand the sorry story of Britishvolt. The startup was formed in 2019 to build batteries for electric cars in the UK. It was first to be established (with promise of government subsidies) in south Wales, and then in Blyth in Northumberland, again with large subsidies promised. Three years later, it is considering going into administration amongst other options.

Continued in the Guardian 12 November 2022

Thoughts on the end of Truss and how Labour might react

The tendency to see British politics as an expression of a deeply entrenched, long-gone past has not helped us understand how much has changed in recent times. We have just witnessed the latest failed Conservative attempt to break with the Cameron-Osborne paradigm to which we have now returned. Labour, too, is tempted to return to the pre-2015 era. But there is no going back, and new realities need new politics. 

The transformation of the Tories into a May-Johnson-Truss Brexit Party was an extraordinary rejection of the New Labour/Cameronian consensus. But more than this, it triggered a whole new understanding of the state of the nation. On the one hand there was a radical revivalism, a depiction of Britain as an innovation superpower, ready to unshackle itself from Europe and assume its proper place in the world. It was implied that Margaret Thatcher had reversed the historic decline of the United Kingdom. 

On the other hand, there was a new understanding that much of the country had been left behind during these years and that a new national politics of “levelling up” was needed. Brexit contained all this and more. 

There was always a hard-right Thatcherite programme of privatisation, deregulation and free trade at the heart of the Brexit project. Both Theresa May, and to a lesser extent Boris Johnson, counterbalanced this with a more interventionist and nationalist approach. But Trussism represented this radical, free-market Brexit in its purest form.  

Continued in the New Statesman

Q&A The Queen’s Death and Competing Narratives of Empire

Does the U.K. focus too much on its imperial past, or not enough?

Nesrine Malik of the Guardian and I were taking different positions on the pertinence of empire to very recent British history. I was challenging the practice of merely asserting the significance of empire and suggested that this obscured many of the most important features of contemporary politics. We are in conversation with Isaac Chotiner, New Yorker 21 September 2022. See also my Guardian article on this theme posted below.

The Tories were once the party of the monarchy. Now they have other priorities

Following the death of Elizabeth II, power is performing its truths, transforming princes into kings and dukes and children into princes. But as the British state becomes less legitimate, these processes are losing their potency. The late Queen is revered across the world but the monarchy itself has lost its magic. Charles is King, but the monarchy will not be what it was.

Monarchy was never above politics. It rested on it and on the Conservative party in particular. This was the party of the monarchy, the union, the constitution, the established churches and the empire. In 1936, it disposed of a king emperor who offended its bourgeois sensibilities, thus redirecting the royal line of succession down to King Charles III. It was a Conservative government of the 1950s that redefined the monarchy as a national rather than imperial one. A then-imperialist Enoch Powell, in his tilting at the royal titles bill, was appalled, but to no effect. In time, he would become an ardent nationalist, dismissive of empire as a passing phase and the Commonwealth as a racial danger to the nation.

Today’s Conservative party is radically different from that of the 1950s. It has taken up Powellite free marketism and nationalism rather than imperialism. It now cares little for church or constitution. Of course it celebrates the person of the late Queen, but monarchy is a subtly different matter.

Continued in the Observer 11 September 2022

British diplomacy in the dock

In 1997, just ten days into office, Labour’s foreign secretary, Robin Cook, issued a new mission statement for the Foreign and Commonwealth Office. He invited its staff to work with the Blair government “in a joint project to make Britain once again a force for good in the world”. He had the grace and political wit to write “once again”. Since then, the phrase – stripped of that crucial qualifier – has been used repeatedly in official publications as if it represented past, present and future reality. In the 1998 Strategic Defence Review, for example, the defence secretary, George Robertson, noted that: “Our forces must also be able to back up our influence as a leading force for good in the world” (the phrase appeared another nine times throughout the document). It also appeared in the 2005 Defence Industrial Strategy. In 2019 Dominic Raab, then foreign secretary, claimed that “Global Britain is leading the world as a force for good”. The “Integrated Review” of 2021 claimed “a renewed commitment to the UK as a force for good in the world”. 

Arthur Snell, a British diplomat between the late 1990s and 2014, who served in countries such as Iraq, Afghanistan and Yemen, is contemptuous of the idea and the delusions behind it. “Put bluntly,” he writes, “a lot of the bad stuff happening right now is happening because of Britain.” From Kosovo to Brexit, Britain’s role in the world has been a force less for good than for the lamentable and abhorrent. It never stops to ask if it could actually “punch above its weight”, or even whether it should be trying to punch at all. Snell exaggerates the UK’s status in world affairs, but nonetheless offers a lucid rap sheet of egregious errors and self-delusions that have left destruction in their wake.

Continued in the New Statesman 24 August 2022

Yes, we’re in a bad way. But to wallow in myths of British ‘declinism’ won’t help us thrive

Decline is back. Commentators are noticing that the UK economy has not been doing well and is projected to stagnate. Other countries are doing better, in productivity, investment, research and skills. It really is deja vu all over again. But not quite. Only yesterday we were being told a different story – one of the fastest rates of growth in the OECD, of a new global, buccaneering Britain, a science superpower, an innovation hub, the fastest vaccine rollout… What is going on?

We have been living in an era of revivalism. At its core is an economic story which holds that Thatcherism had reversed the longstanding British economic decline, which had perhaps started in the 1870s, or perhaps in 1945. From being the sick man of Europe, the UK could stand proud again, and return to a global role. This view profoundly affected politics. New Labour, the party of post-decline cool Britannia, started to talk of British leadership, of global Britain, of a special internationalist destiny.

Continued in the Observer 12 June 2022

Work, Production and Capitalism in the UK since 1970

This is the text of a paper for the Resources for National Renewal programme, History and Analysis Series 13 May 2021. For the final report see: Labour’s Covenant (January 2022)

Version with images of this paper here 

In this paper I  want to develop some themes adumbrated so well by Jon Cruddas and Peter Dolan, and also extending the story to include British capitalism.  I certainly agree with their key points that we need to both take work seriously, and that the Thatcher revolution did not reverse the British decline.

 Declinism and Revivalism

 On overall point I want to make is that in lots of deep ways the supposed trajectory of British history has been central to British politics for  some time. We are two often trapped within tawdry narratives which mislead and confuse. We need something better.  We need, for example, to be clear that the pictures painted by declinism and revivalism both were far from empirically sound.

 Declinism was central to discourse on the British economy from the early 1960s onwards. It was central to the politics of Harold Wilson, who put forward a coherent set of arguments from a declinist perspective in 1964. It was also central to the politics of Margaret Thatcher, which were all about reversing the decline, and got transformative energy from the sense they had of the vital importance of that task.  But declinism continued to central to the politics of the left. Indeed a central left argument was that Thatcher’s policies would make the decline worse, since they were precisely those which had led to it in the first place.

 Declinism was also at the heart of crucial left-intellectual framings of British history. It was central to Eric Hobsbawm’s work on the UK. It was and remains central to the Nairn/Anderson tradition.  Both posit a deep continuity thesis in which the UK was frozen in an Edwardian time warp, when it was liberal, global, imperial, financial, City-dominated. The consequence was the persistent weakness of the national economy, of the productive economy.  This idea, this national and nationalist critique of British political economy, was the central mantra of the left, and were the core theses which informed the Alternative Economic Strategy.

 New Labour involved a repudiation of such analyses. The Thatcher miracle had worked, she had been right to close the mines, to get rid of inefficient manufacturing, to let the gales of creative destruction do their work. The result was a new ‘cool Britannia’, an inventive nation, with a big role to play on the world stage.  The economy could look after itself, and could be taxed to fund a more ample welfare state; in essence this was a replay of the 1950s revisionist welfarism, the real tax-and-spend programme in British politics.  Decline was dead.

 That idea that decline has been reversed, that the British economy has been entrepreneurial, successful, the envy of eurosclerotic countries, has been very important to British politics since the 1990s. As well as being crucial to New Labour it fuelled Euroscepticism and Brexit. Indeed it is very notable that Brexiters took to complaining about the ‘declinism’ of Remoaners. 

 The supposed British revival was evidenced above all by claims about a new British genius for innovation, once again to be compared with that of the scientific and industrial revolutions. It was also supposedly evident in the claim that the UK was shifting its trade away from the EU to the world. The first position was and is frankly silly, the second profoundly misleading in that it was true of I think nearly every EU country. Note too that revivalism was an odd position for Brexiters to take: a more obvious one would have been the declinist one that the EU was responsible for the decline (the position of Lexiters in the 1980s).  It points to the fact that Brexiters were mostly radical Thatcherite revivalists, as were many Brexit voters.

 But there was no revival, no Thatcher miracle. Productivity in manufacturing is still below that of French and German industry, with similar differences to those of the 1970s. Furthermore, for obvious reasons, the UK’s share of world output, R&D, innovation, military spending and so and so forth, is lower than in 1979. In short, we need to understand that the rest of the world has moved on.

 That is not of course to say that the UK has merely fallen behind. It has clearly changed radically since the 1970s.  However how it has changed is a crucial question, and one which the left has been poor at describing.

 Labelling and describing how things have changed

 Clearly there are some very particular terms of art out there which purport to summarise and explain how things have changed since the 1970s. This is not the place to go through them all, but only to alert us to the weakness of many of these stories. For example those accounts which insist we have left the age of  the Keynesian welfare state and are now in neoliberalism, have some difficulty in understanding the fact as a proportion of GDP welfare expenditures are higher than ever in British history, or that since 2008 massive state intervention has kept economies ticking over.  To take another example: since then ‘austerity’  has not been a general policy, but one targeted on very particular public services, excluding, notably,  support for the old and the NHS.  

 We need also to look at New Labour’s favourite concepts, technology and globalization, both in the celebratory New Labour mode, and the critical mode of many others.   Both concepts were, as Jon Cruddas rightly insists, central to the New Labour project. We also need to recognise their distinctiveness in British political history. It is mistake to equate it with the Wilsonian White Heat, for that was a declinist programme which had at its heart the belief that Labour and socialism alone could make a decent society in the age of automation and international competition.  New Labour’s techno-global enthusiasm  was a very specific kind of There is No Alternative form of thinking favoured by global management consultants; it was the stuff of airport business books. It was influenced also by a set of New Times stories from a left which had discovered the joys of shopping, anathema to Harold Wilson.

 The idea of the nation as a democratic collectivity of real people has disappeared from English politics. The political nation has ceased to care about much of the population, and thinks first of the wealthy as ‘investors’ and ‘wealth creators’; there are no longer workers but entrepreneurs and small businesses; there is no working class but  ‘hard-working families’ or the ‘squeezed middle’,  and now a fantastical reactionary ‘red wall’.  Putting the real national collectivity, not least that of producers, workers, employees, and trade unions, into the political imaginary would be a fundamental step forward. 

 Jon Cruddas is very right to dismiss technological determinist theses on the left. But there is perhaps more wrong with technological determinism that is apparent. It is not just a matter of a methodological error. Most technologically determinist arguments also get both the technology and what is supposed to be determined wrong also.  The discourse on technology and society is an intellectual disgrace, as can be seen by looking at claims for a ‘fourth industrial revolution’. Our accounts of ‘technology’, a brain-macerating concept, are the  purest bullshit, - take the droning on about 3D printing when its main use is probably in art schools.

 The key point is that we don’t have anything like a good account of the change in the machinery our society uses.   We have good information for some, I suppose best for technologies of leisure and everyday personal use.  But for the machines associated with work our picture is very limited. More importantly what we have is highly biased towards a very small selection of machines which are granted transformative power, elements of IT, biotechnology, and similar.

 But we can usefully start by looking around, and coming to our own conclusions about the nature of the national inventory of  machines and how they might have changed our working lives. We might note the very large increase in cars and trucks on our streets since the 1970s.  We might note the importance of new kinds of freight handling, not least the container and the juggernaut.  We might note the much greater use of tower cranes in building.  

 Manufacturing industry

 The UK had in the years after the war an exceptionally manufacturing oriented economy, it was at peak relative manufacturing in the 1950s and 1960s, not the 1850s or 1860s.    It was this period which created a very manufacturing-oriented history of the UK, which is in many ways still with us.

 If we were to look at manufacturing industry we might note that most of the type of things being made were being made in 1970, often in the same places.  Cars are still being made in Cowley, chlorine in Runcorn, steel in Port Talbot, petrochemicals in Grangemouth.  In all these places the productivity of labour has increased – and quite a lot over the last forty years.  Many fewer workers are employed.  

 But we should not assume this is a necessary consequence of technical change. Germany has two massive historical complexes which have no parallel in the contemporary UK.   BASF at Ludwigshafen employs tens of thousands of workers making chemicals, 39,000 to be exact.[1]  Volkswagen at Wolfsburg, first built as a kind of copy of Ford Dagenham in the late 1930s, today employs 60,500 people.[2]  Imagine a Dagenham or a Cowley or an Ellesmere Port employing these numbers!  In Japan and Korea too there are gigantic car complexes.  Of course they are not huge employers because they are technically backward; the opposite is the case.   Note too that these are not low wage countries. German workers are paid more than British ones.

 The UK has certainly stopped producing a lot of things over the last forty years. But most of these things are still being produced elsewhere, often in rich countries.  The UK is no longer a producer of high-end trains, though the EU clearly is.  It no longer builds great passenger ships, an industry which still exists in Germany and Italy.  

 Since the 1970s UK manufacturing has not declined. Its output is up a bit. It is however, a much smaller part of the economy than it was, and accounts for an even lower proportion of employment.   Today the share of manufacturing in the UK economy is significantly lower than that of Germany, though not that of France.  But what is especially striking is the lack of UK centred manufacturing firms of significance. There are no longer any ICIs, GECs, or British Leylands. German and French capital much more important in the UK than vice versa – there are no British car plants in Germany or France, no British electrical engineers in Germany.  In addition the UK is a massive net importer of manufactures, when once not so long ago is was a huge net exporter.  It is an importer not only of finished manufactures (it is a net importer of cars), but also of components. Thus a car exported from the UK will only be partly British made.

 Associated with this is a fall in R&D GDP ratio.  The ratio is not only smaller than in the 1970s, but well below that of the early 1960s.  There are unjustified nationalist consolations in the case of big pharma and aerospace. In both cases however, the key firms operating in the UK do so as part of much larger framings. UK aerospace makes multi-national aeroplanes; UK pharma is a set of branches of global pharma.   Which brings us to the question, did this new dispensation unleash a wave of entrepreneurship and business building in British manufacturing? Clearly there are some cases, but nothing one could call spectacular.  It is telling that there are stories about venture capital and high valuations, but stories of significant output and employment are very much rarer.  One would be hard pushed to claim a great transformation in British industry driven by British innovation.

 Most of the economy

 But we must get away from too much of a focus on manufacturing.  We need to look at the whole economy. The big thing in output is not replacement of industry, but the addition of service output, on a huge scale. The overwhelming proportion of growth in the economy since the 1970s has been the addition of services. The big shift from industry to services long predated Thatcher – it goes back to the late 1960s.

 But before we take the story forward it is important to note that before the 1960s and before 1939 the tertiary sector employed more than half the population.  In other words when we think of the ‘traditional’ British working class we should not think first of the factory or the mine, but the mass of tertiary sector occupations.  Ernest Bevin’s T&GWU, the largest trade union in the world, was not a manufacturing trade union except incidentally. It was a union of dockers, carters, truck, bus, tram drivers, and other workers engaged in transport activities (excepting railways).  It was a union of precarious, often immigrant workers, as was true of the docks. The railway unions were also very large.  Indeed, the famous Triple Alliance did not represent manufacturing workers at all – it brought together dockers, carters, bus and tram workers, seamen, the main railway union, and the miners.  One has only to think of other great unions – from the shopworkers to the municipal workers to make the point that we should not overemphasise manufacturing, or mining, in the history of trade unions.  Furthermore when we think of manufacturing trade unions at the beginning of the twentieth century we need to remember the centrality to the movement of the huge textile workers’ unions, and not just the many shipbuilding and engineering unions.  

 So what has happened to the workforce since the 1970s?  To listen to the public discourse is to assume that there has been a massive shift to creating one’s own business.  But while self-employment has increased, it has really returned to prewar levels, a world of many independent shops and other businesses, often tiny.  The second image is of a move from secure well-paid manufacturing jobs to precarious ones.  While it is true that manufacturing jobs have fallen, and precarious jobs have increased, it is obviously not so simple. Many precarious jobs arose out of the transformation of previously secure service jobs.  Another image is of new jobs determined by new technology.  Is the stagnation of wages in many sectors, and the emergence of precarious work, the production of new technologies of automation?  The answer is surely no: as Aaron Benanav suggests it is more likely due to standard levels of technical change combined with low wages caused by low economic activity and a weak labour force.[3]

 But there has been an extraordinary expansion in very, very low tech jobs. Consider for example the spread of the bicycle delivery, or indeed the van delivery, as the necessary supplement to electronic ordering.  And note the huge expansion of the care sector.  No, the whole framing of work been driven by technical change is a macro fiction based on choosing a very particular micro focus.

And then there is the other great handwaving argument of the era – that globalisation is the force driving down wages and conditions.  It does not do it in itself:  it is a matter of choice. Most workers are not producing goods that are traded globally but rather services which are traded locally.  Capital is mobile and has the power to push wages low, but that it has that power is the result of policy decisions.  Take the argument by Martin Sandbu, that rather than reject globalisation what is needed are direct policies for raising pay and reducing inequality, and reskilling the workforce. That will bring in automation and high wages. An example is the hand car wash and the automated one, which need to return. [4]

 But much more was happening than any of these images convey. The fall in manufacturing and mining, to be replaced by inferior jobs is only a small part of the story overall though it is clearly the central story in particular parts of the country.  In the table below we see surprising stability in some areas (though with much change within them – for example in transport there was a massive shift from docks, trains, buses, ships to trucks). But what is most striking at this level of aggregation is that manufacturing jobs were replaced by 

 1)    miscellaneous services including hotels and catering, which have both obviously boomed in the last forty years, and are often precarious. These are not jobs created by new technologies, but rather by high incomes, and note that under a more sensible industrial classification cooking in a restaurant might be considered manufacturing.

 2)    professional, scientific and technical services, now employing three times more than manufacturing.  Central here are the welfare state professions and activities – health and education. Both have expanded hugely in terms of numbers employed. Health and education have some elements of technical novelty, but neither expanded mainly because of technical change.  Nor were the jobs themselves that radically changed by technical changes.  Again the key driver is increasing income – as countries get richer they demand and get more education and more health care.

 Although there is a very large range of conditions of work within health and education it should be noted that here we have a very significant expansion of white collar, secure and often unionised work.  This part of the story  clashes profoundly with the end of the welfare state and drive to precarity narrative. Can put it this way too the number of miners fell radically, the number of academic grew. There have been more academics than miners from early 1990s.

 

See

https://www.ons.gov.uk/economy/nationalaccounts/uksectoraccounts/compendium/economicreview/april2019/longtermtrendsinukemployment1861to2018

 

 

Trades Unions and labour support

 The lazy assumption made in so much of the discussion about the Labour Party that the working class at some point all voted Labour is a pernicious error.   We should reject the notion therefore that the Labour party was either the natural party of government, or the natural party of the working class.  Both notions derive from a very particular post-1945 moment (see appendix). It ignores the fact that the urban working class made up (uniquely in the British case) some three quarters of the population.  Obviously before 1914 only a tiny percentage of this class voted Labour; more voted Labour by the 1930s, perhaps just over a third on average.   It is salutary to remember that Labour’s highest vote was in 1951, at just under half.  It was thus only in this period attracting significantly more than half the working class vote.  We should also remember that that Eric Hobsbawm put the end of the forward march of labour at exactly this point (and not as it is often assumed in the 1970s when he was writing).  This was the point at which the Labour share of the vote, and of working class vote, stopped rising.

 It is also important to remember something obvious but too easily forgotten. It is that Labour was not the party of the working class per se, but of the organised working class. The party was the party of the organised miners, cotton workers, dockers, railway workers, engineers.  The party put not workers, but trade union officials, into parliament.  It is useful to ask of today, who are the organised workers?

 The number and share of organised workers has diminished, but it is higher than Edwardian levels, and roughly at 1930s levels.  But the key point is that the nature of the organised workers has changed radically, reflecting both the changing nature of the workforce, and place in the labour market of particular kinds of workers.  Membership of trade unions now much more female than it was. Also trade unions better educated than the population, and more likely to be working in the public sector. This should not be taken to mean that trade unions, like Labour supposedly, are institutions of the metropolitan elite. It is rather than younger people are more likely to be workers, and be better educated than the population as a whole, and that in the workforce overall there has been upskilling at least at the level of qualifications. 

  

Trade Unions with over 100,000 members 2017.

UNISON  (mostly female, public sector) 1,369,114

 Unite the Union (mostly male, private sector) 1,291,017

 GMB 613,400

 National Education Union 510,000 Non-Labour

Royal College of Nursing 432,000 Non-Labour, Non-TUC

Union of Shop, Distributive and Allied Workers 425,700

 National Association of Schoolmasters

Union of Women Teachers 333,223 Non-Labour

Public and Commercial Services Union 262,800 Non-Labour

Communication Workers Union 201,900

 British Medical Association 152,200 Non-TUC Non-Labour

Prospect 145,000 Non-Labour

University and College Union 115,800 Non-Labour

 Source: Wikipedia

 One obvious reaction to these figures is to say that the unions have became middle class.  And therein lies a crucial problem. In far too much discussion the implied definition of working class is radically different from what it was earlier in the century.  For most of the twentieth century the standard definition of working class accounted for say three quarters of the population.  Today’s definition is radically different. A standard one is the advertisers’ category C2DE which represents only 43 percent of the population.[5]  Worse still the qualitative image of the working class seems to be of old, former workers,  retired or made redundant from industries which ceased to matter decades ago. The working class is also contrasted with those who have education; the assumption seems to be that the working class still leaves school at 14.  Tories would like nothing better that Labour to take up a nostalgic focus on decayed industrial areas, votes there are unlikely to win, while they would lose in other areas, not least to the greens. Labour is walking straight into the trap.

 We would be much better off if we took to thinking of Labour as the potential party of 75 percent of the population, as it was in 1945 say, and refine that to understand that it would particularly attract organise workers, who were always more prominent among the more skilled, secure, and well-paid.  That 75 percent are still employees, and they are more different from the top 5 percent, or 1 percent, than they were in the 1950s and 1960s.  One can put it another way.  Yesterday’s skilled engineer is today’s degree-holding administrator.  The children of the million miners of 1920 are the nearly 1.4m health workers of today.  We wrongly think of this as social mobility out of the working class – it is not. It is transformation of the working class.

 The problem is not being out of touch with the working class, but rather with the real world. The central issue is not that the Labour Party has not kept its contract with the remnants of the working class of the old economic order (and it hasn’t), it is that it fails to understand the working class of today, not least the organised working class, much of which is not even affiliated to Labour.  That would have been unthinkable in 1945.

 The nature of British capital

 To an extraordinary extent Labour has historically failed to develop an account of British capitalism, and the Tory Party.  If it has an image of either it is perhaps the Tory party and the capitalism of the 1930s, as imagined in the 1960s.  (Of its is nostalgic for anything it is the Second World War as imagined in the 1960s). There has been a failure to understand Thatcherism as a set of ideas and practices, and even more so Brexitism and Johnsonism. Labour has become, more than it ever was a supine, subaltern party, bereft of an analysis of the society in which it operates.  It is a party which (in a very silly way) hates Tories and loves the NHS, which it treats with mawkish sentimentality, wrong believing this wins votes.  It needs to be a party with a critique of society, not just its political opponents.

 Indeed, as many have argued, Labour has long been weak in defining a distinctive social democratic understanding.  It was a free trading party into the 1930s, and emphasised the iniquity of unearned income, the rentier incomes, as radical liberals did (I return to this point below). In the 1940s and later the main argument for nationalisation was that particular industries were letting down the nation, rather than because they were powerful capitalist enterprises. This is not to say that nationalisation had no effects, including very many positive ones, but it is to point out the limits of the Labour understanding of the economy.  Under the revisionist programme of 1959 it was held that British capitalism was now working fine – it need only be taxed to increase equality.

 Harold Wilson, however, took a very different view. Long an intervener in industry, he took up with alacrity the declinist critique of the British elite and of British capitalism.  British capitalism was failing he said – the financiers and aristocrats were in control, not the technicians.  This was a powerful national critique which paid off.  The critique of British business would develop on the left, and would strongly influence the AES. British capitalism was held to be too internationalist, and not nationalist enough.  Labour was out to save British business from itself.

 By the late 1990s things changed radically. Labour now thought the UK economy was flourishing, that it was dynamic and entrepreneurial.  It was happy to see finance very much stronger and more powerful than it had been in the interwar years.  It was time again for tax and spend.  It put globalisation and innovation at the centre of its positive understanding of the economy.  It was a Liberal party, a radical free trading party concerned to make capitalism work through creating a welfare state based not on universalism, but targeting, what used to be called means testing.

 The key changes in capitalism in the UK since the 1970s have been profound.  The story of coal is instructive. Under Thatcher output fell only a little, with employment fell by 4/5, and imports increased.  Under John Major output halved, and employment fell very much more, and it was privatised in 1995.  Under New Labour output halved again, and imports doubled. Imports became larger than domestic production only under New Labour, in 2001, and remained so (see appendix below for the figures). Global coal production is still increasing, and is produced with extraordinary levels of efficiency.  Australia produces more coal than the UK coalfield did at its peak in 1913, and with a workforce smaller than Dagenham at its peak.

 Since the 1980s a new economy emerged, with London essentially a rich, and very cosmopolitan enclave.  The FTSE was no longer a barometer of the British economy, nor indeed of British capitalism.   The firms on it very often did more business outside the UK than at home, much of it was owned from abroad, and in any case many of the largest firms in the UK were not listed as they were subsidiaries of foreign companies.  The City was not the thing of continuity theses, exporting British capital. It was rather a place where world capitalism did its global and its British business. The UK became a massive importer of capital, which offset the extraordinary balance of trade deficits. Far from offering a new dynamism, creating new firms, developing transformative new techniques or leading the world in some other way, the British economy outside finance does not look strong. 

 The business is one of creating profits for the owners of property.  It is little wonder that one of the most important developments in recent years in left thinking about the economy has been the emphasis on financialization, and in the crucial work of Brett Christophers, a comprehensive analysis of the rentier economy, something which goes much further that our image of the passive owner of stock.[6]  It certainly helps make sense of the low production, low productivity, low innovation, but high profit economy we have.

 Yet the political response to all this has been muted, amounting to little more that critiques of the use of transfer pricing and tax havens.  Even under Covid the extraction of political-contact rents has been treated as mere old fashioned sleaze, when it is clearly much more than that. 

  

A politics of work and critique of the rentier economy

 Is there room for a critique of rentier capitalism?  James Meadway proposed such a politics for Labour, which he identifies with Chartism, and contrasts with a socialist tradition of attacking all capitalism, and the British revisionist social democrats who went for growthsmanship.   I would say in a first response to this that anti-landlordism and anti-rentierism was the central ideology of the Labour party well into the 1940s.  It really did not have a socialist phase at all, before moving to growthmanship. But it did have declinist phases, which were similar to anti-rentier politics in that they were critiques of finance rather than productive capitalism. Anti-rentier politics, it can be argued,  lies at the heart of the Labour project.  The aim today would be ‘a reassertion of labour’s historic claim to the national wealth, rather than claims on its technical abilities to increase that wealth’, all the more relevant in an age of low growth. This at minimum would involve action on tax havens, a proper capital gains tax, corporate taxes, and a wealth or property tax.

 The other side of this coin is the support of productive work. And here too there are many political possibilities, especially once one gets rid of a politics of chasing GDP. As James puts it, the strategy would be ‘to mobilise those on the wrong side of the dual economy with at least some section of its winners. It would offer an economic programme centred on the value of specific work, performed in specific places for specific purposes, rather than on the abstractions of GDP or productivity; industrial strategy and related interventions based around the need to sustain valuable work, notably in the care sector; a radical decentralisation of economic institutions towards the places that work can be performed in’.  

 Labour could renew a social democratic programme. Its essence is a calculus at national level designed to combine efficacy, efficiency and equality. Social democracy insists these go together rather than being in conflict, but achieving this requires collective action by a national state which can take on private and sectoral interests.  In this view, the state can and should act to create a national community whose members are more like each other economically than they would be under the rule of property.  In this framing, the state acts to ensure a high national floor of income and access to services, to reduce inequalities of income, wealth and geography, not only for its own sake  but because efficiency and efficacy would increase also.

 The above should not be thought of as a policy for recreating a more generous welfare state, and this is one place a new history comes in. It is wrongly believed that Labour’s fundamental historical policy was welfare, but this was only true in 1959, and between 1997 and 2015.  Labour was first of all a party of production, of transformation of the economy, of work, of creating richer lives, as well as of welfare. Labour needs to recover that sense of being the party of a new politics of production and consumption, focussed on work and workers not property; for example, through advocating worker shareholdings and board representation. 

 This could also involve a new politics of products services and machines.  A very good example is the set of ideas around reconceptualising the foundational economy.  But there are a whole range of other issues around quality, the life of products, repairability and more: in short the whole way we think about and organise how we produce and consume.

 One aspect of this is clearly apparent in the need to transform the energetic basis of the economy and society to stop runaway climate change.  It is obvious that both global and national action and conceptualisation is required, and much more than adjusting energy prices. A national framing, and national state action, is needed to effect the necessary coordinated transformation of energy supply with (to return to that trio)  equity, efficiency and efficacy. Rentier capitalism will not achieve this.

 Another is to think through the political economics of the public sector, including health care and education. Sentimentalism about both has obscured the myriad ways in which privatisation and marketisation are undermining the conditions for good work reflecting educational and health necessities.

 Finally, critical attention needs to be given to the nature of the British state – it is clearly deficient both democratically and in terms of expertise and capacity to act in anything but the interests of a few.  Hollowed out, mendacious, and grotesquely self-important, it hides its lack of shame by, in a very unBritish way, wrapping itself in the Union Jack.

 Last thoughts

 We should not assume that the Tories are bound to win, and Labour bound to lose. The Tories are clearly cleverer, more nimble, and have control of nearly all the media.  But they have also tied themselves to the old, to programmes they are very unlikely to be able to deliver, and to Brexit, which will damage the economy, not least in former Labour areas.

Labour, if it does not throw away its lead among the young, and among those who voted remain, and crucially, builds its own self confident arguments, has every chance of winning by creating an electoral coalition. Indeed this is a moment of opportunity, as politics has become interesting and dynamic. And that, tragically, is now the problem for Labour – does it have anything interesting to say? And if so, does it dare say it? Is the problem lack of courage of its convictions, or not having any convictions at all?

 

For the appendix and other images see the version online, link above.

[1]https://www.basf.com/global/en/who-we-are/organization/locations/europe/german-sites/ludwigshafen.html

[2] https://www.volkswagen-karriere.de/en/working-at-volkswagen/sites/site-wolfsburg.html

[3] Aaron Bananav, Automation and the Future of Work (Verso Books, 2020).

[4] Martin Sandbu, The Economics of Belonging: A Radical Plan to Win Back the Left Behind and Achieve Prosperity for All, (Princeton, 2020)

[5]https://yougov.co.uk/topics/politics/articles-reports/2019/11/25/how-well-do-abc1-and-c2de-correspond-our-own-class

[6] See also https://autonomy.work/portfolio/berry-class-rent/

Thinking with the Nation

This is the text of a paper for the Resources for National Renewal programme, National Economy Group, 5 March 2021. For the final report see: Labour’s Covenant (January 2022)

 

Being explicit and creative about the nation is a way of making Labour’s whole programme credible, different, and popular, as well as being true to its history.   While it carries dangers, it is the obvious way of developing a politics directed at making the country more democratic and more equal.

But the Anglo-British Left has a problem with the nation.  Nationalism is in its view a bad thing, the antithesis of a proper internationalism. In this the British Left are true descendants of British liberalism and imperialism which saw, correctly, that nationalism was the enemy of global free markets and of British imperialism.  To complicate matters, today’s British left (wrongly) sees imperialism as the purest manifestation of British nationalism, and is blind to non-imperial British nationalism, not least that of the Left. 

It really is time the British left understood its own history and stopped its liberal-imperialist sneering at Scottish, Irish and Welsh nationalism and pretending that the Anglo-British are above such things.  This implies understanding the intimate relations between nationalism and socialism in most parts of the world and taking a critical look at actually-existing British nationalism, including recognising the serious loss of legitimacy of the UK not only in Northern Ireland, but also Scotland and Wales.

Labour needs to know its history, and to recognise it is very different from the standard welfarist Spirit of ’45 saga it is so often claimed to be.  The great programmes of the British left from 1945 into the 1980s were nothing if not nationalist, and nothing if not productivist.   Labour was the party of the national economy, and a national capitalism too.   From Bevan to Benn, and from Attlee to Wilson the idea of a national economy and a policy of national reconstruction were central.  In the 1970s and early 1980s the Labour left was nationalist and Brexiter, seeking in effect a return to the Labour policies, and British practices, of the 1940s, 50s, and 60s.

Under post-war Labour we had a national politics of productivity and improvement. and it had a certain success.  We had a politics of the transformation of infrastructure, based on a notion of universal availability at national level.  And, up to a point, that worked.  A key aim of nation policy was also reduction in inequality, and that too, within limits, worked.   

 Nation as basis of critique

It is vital to understand that a national framing need not imply the crass sentimentalism, exceptionalism, and delusional revivalism it has come to be associated with in today’s England (elsewhere in the UK the nation increasingly means not the UK but Ireland, Scotland or Wales, and those nations are represented by very different images).   Indeed, historically the national has long been the central focus of the left critique of Britain and its elite.   Labour, and the left generally, was the party of the national critique of the Tories for being the party of property and self-interest rather than the nation.  The national focus is the basis for calling out private interests and policies which undermine the nation and the national community.  The nation is the antithesis of the selfish private interest. The national critique is also about who controls the internal economy, and to what end.   Emphasising the national is also to emphasise democracy, control by the people, rather than by the elite. 

Indeed, the core historical-political-economic thesis the Left has had about the British past and present is a nationalist critique of what it takes to be British exceptionalism. It is that imperialism, the City, and an internationally oriented elite associated with both made national economic reconstruction impossible, or at least difficult. Scottish and Welsh nationalism owes much to this tradition and thus attack the nature of power in Whitehall/Westminster not the English.

It is important to note that these left nationalist theses – from British, or Scottish or Welsh nationalists – were not anti-foreigner, or the case of the Scottish and Welsh, anti-English.  They were anti a very particular British elite.  Nationalisms of the right have obviously been very different.

 

Nationalism without the Nation

The British nation that existed between 1945 and the 1970s no longer exists. For the last 40 years we have had a different kind of politics, a politics of property, not a politics of productivity, a politics not of equality, but of inequality, of ‘flexibility’ in a globalised context. There has indeed been a politics of differentiation between parts of the country, and of classes. We have been living for a while with, high inequality in incomes and across regions, and to an extent a dual economy, and a rentier economy too, with huge disparities in wealth, and very high returns to property.  

Increased inequality was not the price paid for a more efficient economy; Thatcherism did not raise the economy to world leading level. It is still much less productive than the German or French.   It has not unleashed fresh British entrepreneurship. Thatcherism broke decisively with the general presumption that British consumers should buy British.  When the consumer became king, the nation of consumers, no longer had or felt any responsibility to the national producers. 

This programme has broken key elements of the nationalness of the economy.  The notion of the nation is changed if the territory of the nation includes people with radically different life chances, with people sharing more with the rich or poor of other places than with each other.  It is changed if one part of the country has an economic level closer to that of other countries, than to the rest of the same country.   There is very clearly a London and South East economy, and a rest of the UK economy.  There is also in many respects what might be called a dual economy – one of precarity, and the other of relatively stable work and radically better conditions. To speak of One Nation is today, at many levels, an absurdity.

Furthermore, since the 1970s the Union has been under strain, exacerbated radically by the politics and economics of Thatcherism.  Devolution within the EU has kept the UK afloat, but the afront to the nations of  an imposed Brexit has opened up the question of secession of Northern Ireland and Scotland in fresh ways. Whereas until quite recently the Tories were an English and Welsh, Scottish and Northern Irish party, and Labour a Great Britain only party, today both are essentially England and Wales parties only.

 

Brexit and the Nation

Since the financial crisis, and Covid, the state has had a large economic role. The economy has been running on supercharged intervention. The question is not whether or even on what scale the state should intervene, but how and to what effect, and in whose benefit the state intervenes.  It is also crucial to note that as far as Covid health measures are concerned it a question of the policies and programmes of four nations, not one.  Labour cannot not simply be the party of the larger state – it should be the party of a different state, and in practice an English or English and Welsh state only.

Since Brexit national economic controls have become a live issue. But Brexit itself does not make the economy more national, not least in the senses discussed above.  There are important choices to be made about tariffs (the tariff regime for non-UE is much the same as it was), NTBs, and policies for subsidy and procurement.   There are many post-Brexit possibilities here for the creation of a much more national or indeed a much less national economy.

For the Brexiters Brexit has been, and continues to be, a radically globalist politics shamelessly and mendaciously dressed up in nationalist garb. The thrust of policy is towards developing free ports and ideologically the talk is of free trade implying minimal protection, lower that is than the protections the EU gave (and current tariffs and NTBs broadly replicate).  Any trade deals beyond the current crop of continuity deals will involve (obviously) reductions in protection, most notably NTBs in food.  The net effect so far is reduction in exports, and a distinct weakening of the position of British-based production, but one should not assume that a reduction of trade and increased home supply is in fact the policy of the government.   Furthermore, in all probability the effect of current trade policy will be greater inequality, including regional inequality, worsening the current situation.   While Brexit has damaged UK to EU exports, it has not affected (yet) imports from the EU.

 Brexit reality, for all its overt nationalism, is deeply antithetical to any sort of national economy Labour would want to build.   

Might a national critique have traction against the post-Covid, post-Brexit Tories?  The answer is surely yes.  It has destroyed much of the fishing industry, and real Brexit is hardly good for British agriculture or manufacturing. But it needs to be noted there is no national solution to these problems, which arise from loss of export markets.  Lurking here is a key and complex issue – the EU is more national and less globalist than the Brexiter UK.  At the same time the more UK-national the programme the greater still will be the pressure for secession of at least two nations (as well as the costs).  

Brexit has also separated the Tories from business as a whole, giving Labour an opportunity to become the party of national business.  But Labour would face the difficulty of selecting out those businesses which are doing the right national thing.   It would need to be the party critical of the studiedly non-British orientation of the great Brexit businessmen has been extraordinary (Ratcliffe, Dyson especially).  More than that it needs to remain critical of the many British-owned businesses in the UK are hardly paragons of nation-building.  In other words, there is a need to highlight the non-national nature of much of British business, so much of which is concerned with extracting rents and sending them to tax havens.  

Thus it is very important not to engage in a nationalist-populist critique of foreign ownership per se.  In many important areas of the economy there are only foreign businesses, and in many cases foreign businesses have been more interested in building for the long term than ‘British’ ones.  The car industry is foreign. Siemens manufactures in the UK; Dyson does not.   Again, a more national political economy might well imply a more pro-EU one.

 

Thinking Nationally

Questions of business and trade and national protection are only part of the story.  We need to get away from the whole idea of the nation as competing with other nations; or the notion that every part of the nation is involved in world trade and needs to be ‘competitive’. Most of the economy is not exposed to external markets.  This is especially true of services, though much less so of manufacturing and agriculture. There is a misunderstanding that services exports are crucial because the economy is 80 percent services.  Service exports are highly concentrated in a very few areas, and most services are not traded internationally at all.  Although goods production is a very small share of output, it represents more than half of all exports.  Indeed many of the worst problems of low wages and precarity are to be found in precisely those already national sectors of the economy, including public services.  Recognising the importance of the non-traded economy, and its essential nature, is a key insight of the Foundational Economy approach, which also of course includes high capital intensity sectors which are likewise fixed to locations. 

Thinking nationally about the economy allows one to focus on the bulk of it which is already national in orientation (even if foreign owned). It allows us once more to ask the fundamental social democratic questions about the difference between collective and private outcomes, about the mutual interaction of consumption and production, that have been forgotten. People need services of many kinds, most of which are supplied by local production.  Here there could be a bringing together of the national consumer and the national producer in new more productive ways.

Emphasising and conceptualising the national is a necessary part of a new infrastructural revolution too, a green industrial revolution, which has to be done nationally, or at least at a level higher than the locality or the enterprise, leveraging the power of the nation for the common good, something the private sector, or local agencies, cannot do on their own.  The foundational economy is through network effects at least a local or national thing. 

As well as focussing on these key issues for people’s lives the national focus forces us to ask, what is best for the nation and its individuals collectively.  Getting things cheap might be what we are forced to do as individuals, but collectively we can arrange to exploit the benefits of longer life of high quality products, the greater productivity of the well trained, and so on.  Well paid producers are better consumers.  Remaking these connections this requires a commitment to do things in new ways, to be measured by new yardsticks.  The essence of the social democratic case is that efficacy and efficiency go with equality and requires an intervention by the state, meaning in effect the national state.

Perhaps most importantly of all a national focus can help restore Labour’s historic programme to speak for workers, the producers,  and to increase equality.  The nation is the obvious (though not the only)  level at which to make the case for greater equality. Indeed a strong sense of nation implies a strong sense of equality, of common purpose.  In this framing building the nation means raising the level of wages and benefits, it means creating high wage work in poor regions, it means reducing regional inequalities.  The focus on the nation also raises the question of who has power in the nation, and over the nation, and how that might be changed through the national vote.

It is telling that the term ‘British’, either within the country, or outside it, is not taken to mean low inequality, high productivity, high benefits or good health.  The UK is a country with particularly high inequality, low productivity, low benefits, and indeed poor health outcomes.  

And that is in part because it has ceased to think as a nation about these things, the political nation has ceased to about much of the population, and things of the wealthy as offshore ‘investors’ and ‘wealth creators’ even when they are not.  

For Labour thinking through the nation matters for it is through the nation that democratic control is enacted, and its underlying programme is one that practically can only be a national programme.  Despite this Labour has been singularly bad at it.

 

Dangers

One result of this is that is has been tempted to adopt the nationalism of the right. The national is not neutral territory.  The nationalism of Conservatism and Brexiters has been of a very particular sort, essentially a combination of radical economic liberalism (now with a willingness to spend huge sums for political advantage) with a rhetorical anti-foreigner/anti-EU nationalism.  

There are dangers of simply buying into the Tory story of the nation, a propagandist-celebratory account which brooks no criticism.  Labour cannot in good conscience follow the revivalism of the Tories which sees the nation blooming since Thatcher.  Nor can it say that today’s UK  is a model for the world. Nor can it say without qualification that ‘Britain has been a force for good in the world’.  Too much of British foreign and defence policy has been in neither the British interest, nor the interest of the world. There are also great dangers in buying into ‘Global Britain’, and notions of British leadership. Indeed we need to rescue our politics from the damaging delusions of global grandeur.

There are also enormous problems for Labour because of its attachment to the British nation (though tending to ignore Northern Ireland). The language of British nationalism may be what the aged voters of England want to hear, but it no longer works for Scotland.

It should also in both a national and internationalist spirit recognise the national interests of others, as much as we recognise a global interest.  And that means recognising the British nation as just one of many. More to the point it means recognising the national interests and concerns of Northern Ireland, Scotland and Wales.   We need to be reconciled to the reality that the UK’s weight in the world, and England’s too,  is that of France, or Spain and Mexico combined.  It is at best, a big Canada, not a small USA. In less than five years of growth China adds to itself the whole UK economy.   It is time to stop talking about the UK as a bridge between the US and Europe.  It is time to recognise that Germany and France are big or bigger players on the world stage, perfectly capable of dealing directly with Washington.  It is time too, to stop indulging in the belief that the UK has military ‘leadership’ in Europe.  

If we don’t address these issues there are real dangers of falling into two very obvious elephant traps.  The first is focussing a nationalist policy on higher defence spending and more nationalistic procurement in the belief that the UK has a special military mission in the world, or even Europe.  That is a live issue: John Healey stated (26/2/21) that

‘Fourth, Labour’s determination to see British investment directed first to British industry is fundamental, not just to our thinking on defence, but to our vision of the kind of society we want to build. When done well, we believe defence spending has a multiplier effect. As the Party of working people and trade unions we see spending on defence as a force for good in the country. It strengthens our UK economy and, as Covid has exposed the risks of relying on foreign supply chains, it also has the potential to strengthen our sovereignty and security. We want to see a higher bar set for decisions to procure Britain’s defence equipment from other countries.’

That is a road the UK left many decades ago, before the EU. A return would be economically retrogressive.  Labour cannot seriously believe that spending on defence is a force for good.  It might be necessary, but a force for economic good, no. And Labour has known that since 1951, at least.  Bringing the consumer and producer together is generally a good idea, but unless one is going to pursue a seriously Gaullist defence policy, it is preferable to buy arms abroad, and produce trains, or green technology, instead. Labour must not return the UK to being the western European ‘Upper Volta with Rockets’.

The second is the temptation to overinvest in high R&D in the belief the UK has exceptional strengths in innovation.  Even if this were true, and it is nowhere near as true as many believe, the chances of it generating production and employment in the UK is low.  The UK, above all England,  needs a new politics of imitation, of emulation, not invention.   Not of leading, but of copying.  Shocking as it may seem, Labour should embrace the idea of England as a modest nation, with much to be modest about.

Speaking Truth About British Power

It is a conceit of journalists and academics that we should speak truth to power. We should instead speak about power. Much of what is spoken about power is not true. Power knows the truth but does not usually need or want to speak it.  Power can even create truths. 

The politics of Brexit are a master class in creating truths. Its ideologues have confected for us an idea that they are  on a world-historical mission to put the United Kingdom back in it proper place in the world. The new truths are reaffirmed every day. With iron discipline the current Foreign Secretary and the Minister for International Trade have made speeches at the core of which was a grotesque misunderstanding of the UK’s place in the world. Penny Mordaunt asked the United States to choose between British free trade and EU and Chinese protectionism.  One after another Brexit negotiators resign, not to rethink but to double down on their claims for British strength. One has to admire the zeal.

The politics of Covid are another example of creating truths. The government repeatedly suggests waves of variants come from overseas, but are beaten back by British vaccine success, and thus that symbol of all that is good, the National Health Service, is saved.

These new truths work because they build on what we believe we know.  For decades we have heard that the UK punches above its weight, that Margaret Thatcher reversed the British decline, that we have a wonderfully competitive entrepreneurial economy. We know in our bones of the wonders of the NHS, and the successes of British pharma. Most of the British political class has been impressed by these claims. The truth machine has worked.

But the British truth machine does not work so well that it changes reality. After five years of Brexit and nearly two years of Covid the UK turns out not to have managed especially well.  Neither should have been surprises.

The Thatcher and subsequent governments did not managed to reverse the British decline, and the  UK economy is not now one of the top performing ones in the world. It might have looked that way from the City of London, but overall the economy grew less fast since 1979 than it did to 1979, and UK productivity is still behind that of Germany or France.  The world has changed greatly since 1979 in ways which have radically diminished the relative heft of the UK. The astonishing rise of China is the central case, but not the only one.   East Asian, Indian, European and the world economy as whole have grown more than the UK one, which has therefore shrunk in relative size. While the UK is a global economy, there are plenty of these in the world, and many have much more clout, not just the USA, but also China and Germany, let alone the EU as a whole. Today’s supposed global champion of free trade trades less. It has created a border in the Irish sea. British fishing has been destroyed, while the future of its agriculture has been sacrificed for headlines. Smaller nations trounce it in trade deals.  

For all the talk about the UK being a science superpower, not least in biosciences, and of the brilliant NHS, the melancholy truth is that British health outcomes were not especially good, and heavily influenced by class.  Covid death tolls and infection rates tell the same story.  All that early talk about a new Beveridge, the Blitz spirit, has faded like the hypocritical bad smell it was.  Even the vaccine success is not the most amazing in the world and depends, as does that of most countries, on supplies from the EU and the United States. The UK has been a large net importer of vaccines, while the EU has been a net exporter. There is an upside to this story which is that the Oxford/AstraZeneca vaccine is produced around the world for use overseas, mainly by and in India.

Recent decades have also shattered complacency about the effectiveness and legitimacy of the British state. It has hardly punched its weight in diplomacy and in the military.  After Iraq and Afghanistan, it is hardly possible for a serious analyst to maintain anything remains of a particular British military genius.   The Conservative party and the state has proved incapable of preparing for the Brexit it wanted. To cap it all it has lost legitimacy as never before, especially in Scotland and Ireland.  The civil service hasn’t covered itself in glory either, partying in Downing Street and various ministries while the rest of us obeyed the rules, and,  like the ministers it serves, staying on holiday in midst of crisis, and working with them to cover scandal up.

We should not take any of this lightly or comfort ourselves that this is a government of incompetents, sleazebags and hypocrites.  It is not their failings which are important, but what they aim to do, and their successes.  The Tories have increased their vote share in every election since 1997 and successfully transformed the UK through Brexit. They have installed themselves as a kind of British DUP, the hardest right government the UK has probably ever had.

But there are grounds for hope.  The Brexit revolution is not converting people to its cause, it does not mobilise the young, or workers, or business.  Supported mainly by the old, it has no positive basis in the everyday life of the economically active.  The Tory party is thus shackled to a failing policy, and a dying electorate, without the capacity even to make the best of a bad job, in hock to its right whose programme is denial of reality.

Reality is teaching important lessons about the limits of British power, the nature of the British economy and society and state.   It is from understanding these realities that a new progressive politics needs to be built.  A politics of real transformation needs to start from what we are: a large Canada, a small Germany, a tiny China.  It will seek to address big issues which require structural change to solve: grotesque inequality, the need to transform the economy to constrain climate change, and dealing with this pandemic and preparing for future ones.  It will be largely a matter of imitation, not innovation, and much will be driven by the rest of the world. Bigging up Britain, wrapped in the comfort blanket that is the Union Jack, will not help one bit.

PERRY ANDERSON VS E P THOMPSON REVISITED ...

In a profile of the historian Perry Anderson, which appeared in the New Statesman in 1999, Edward Skidelsky noted that Anderson’s exchange about British history with the historian E P Thompson in the mid-1960s was “as interesting and as revealing as the better-remembered ‘Two Cultures’ debate between FR Leavis and CP Snow” of a couple of years earlier. There, in an essay first published in the New Statesman, Snow argued that the country was suffering from a deeply ingrained, peculiarly British division between “two cultures”, the sciences and the arts. Scientists had the future in their bones, while writers were Luddites with a tendency to fascism. Since in Britain literature was on top and science, at best, on tap, the upshot was the decline of the British nation, which was going the way of the Venetian Republic.

The so-called debate or controversy between Snow and Leavis was no such thing. It was an asymmetric contest between an intellectual, the literary critic Leavis, and the ludicrous pretensions of the vulgar technocrat Snow. Anderson versus Thompson, by contrast, was a serious bout between two intellectual giants. To put Anderson’s brilliant “Origins of the Present Crisis” – the essay which sparked the debate after it appeared in the journal New Left Review in 1964 – alongside Snow’s The Two Cultures and the Scientific Revolution (1959) is to compare a work of dazzling range and insight with one of plodding portentousness; the first glitters still, the other always groaned.

Continued in the New Statesman

RENEWING LABOUR

The line from the briefers on the eve of Starmer’s speech to the Labour Party conference is that Labour is now looking outward, to the future and is determined to win.  The bleak reality is that it looks inward ever more, finding fault with itself, is obsessed with the recent past of the party, and is judging by the lack of political action, determined to lose.   

Worst still its analysis of its own past is faulty. Far from the worst electoral result in eighty years, the 2019 election was bad but not the worst (take a bow Michael Foot, Gordon Brown and Ed Miliband). In 2017 Labour deprived the Tories of their majority, a rare occurrence, and pushed vote share to 40% (take a bow Tony Blair and Jeremy Corbyn). Labour looked outward and brought people and ideas into party from the outside. 

While it gets its own history wrong, Starmer’s programme has nothing to say about what has happened to the country and what is happening now. It dares not look outward.  Indeed, Starmer’s recent pamphlet is eloquent in only one respect. Every line speaks to a failure to comprehend what has happened to the country.  It is silent when it comes to serious analysis of everything important, whether the impact of Thatcher, the nature of New Labour, the nature of economy or society, Brexit or Covid.  It looks only to its own fantasy Labour past, and to its own Red Wall concoction, and myths of wartime solidarity. It is trapped in its own headlights. Not surprisingly it has no ambition for the future other than to purge the left.

There are perhaps two glimmers of hope for Labour.  The first is that as a party Labour insists on telling different stories.  The other is that Rachel Reeves has found a new way of thinking about the economy.

This is perhaps not obvious, precisely because of its novelty.   Aspiring Chancellors of the Labour right have usually been stuck in macro-economic I-will-do-this-and-that in the budget as well as a lot of fiscal self-flagellation.   Reeves did some of the latter, but did much more. She made one spectacular announcement - £28bn per annum for ten years in Green capital investment. This is the scale of green programme proposed by John McDonnell.

There was also another echo of the novelties of the Corbyn era – a focus on buying from firms operating in the UK, and on a radical (but not specified quantitatively) programme of insourcing.  

In both these cases there seemed to be an underlying argument that the state needed to achieve not short-term efficiencies by driving down costs, but long-term efficacy as well as efficiency.  This is a significant return to the core claims of historic social democracy, to conceptualising a national economy and a state which acts for all, increasing equality, efficacy and efficiency simultaneously.

Even more significant is the conceptualisation of the economy in a new way. Instead of an implicit division between manufacturing and the rest, between globally traded high tech sectors and the rest, so prominent in Labour thinking, old and New Labour, she offered the concept of the everyday economy.  This matters – the greening of the economy is the greening of the everyday economy – of housing, transport, public services, and very obviously infrastructure too.  It points also to interconnection, rather than to atomised enterprises competing in a market.   Especially striking was the formulation that the UK needed an industrial strategy not just for high tech manufacturing (the enduring fantasy of the Tories and Labour) but for the whole economy, specifically including social care. This was allied to the correct understanding that much of the UK economy is low productivity and low-wage and this needs to change.  It echoes the forgotten argument of Harold Wilson that the UK out to scale back on pointless high tech beloved of nationalist Tories (and too many Labour people too) and look to improve the bread-and-butter industries and services which affect all our lives.

Unlike the zombie Blairism and stiff nationalism that Starmer offers, Reeves has mined Labour thinking to plant a seed of renewal.  Will it grow?

How and why the idea of a national economy is radical

Being explicit and creative about the nation is a way of making Labour’s whole programme credible, different, and popular, as well as being true to its history.   While it carries dangers, it is a way of developing a politics, and an underpinning narrative, directed at making the country more democratic, fairer and more equal.  However, the time is past when one could just assume the nation was ‘Britain’ or more properly the United Kingdom. The brief age of the British nation is over, with the legitimacy of the central state strongly challenged in the peripheries, and not only there.

The Anglo-British Left has a problem understanding its own nationalism.   Nationalism is in its view a bad thing, the antithesis of a proper British internationalism. The British Left are descendants of British liberalism and imperialism which saw, correctly, that nationalism was its enemy, and cannot see there can be any such thing as British nationalism except on the right-wing xenophobic fringe. To complicate matters, today’s British left (wrongly) sees imperialism as the purest manifestation of this British nationalism, and is blind to non-imperial British nationalism, not least that of the Left.[1] 

As  in so many other parts of the world, British socialism and social democracy, at least after 1945,  were also nationalist.  From Bevan to Benn, and from Attlee to Wilson the idea of a national economy and a policy of national reconstruction were central.  In the 1970s and early 1980s the Labour left was nationalist and Brexiter, seeking in effect a return to the Labour policies, and British practices, of the 1940s, 50s, and 60s.  Today’s Lexiters stand in a grand tradition.

Labour was the party of the national critique of the Tories for being the party of property and self-interest rather than the nation, and of the ruling class for having interests different from that of the nation. The nationalism, indeed patriotism,  of the left was a critical one which called out chauvinism; attacked, elite special interests; and challenged, those who misused the idea of the nation.  This was not an anti-foreigner, but rather an anti-British-elite nationalism.

Indeed, the core historical-political-economic theses of the broader Left have long been a nationalist critique of  British imperialism, the City, and the globally-oriented elite associated with both. The power of this elite, it is argued, made national economic reconstruction impossible, or at least difficult, with negative consequences for the British economy and working class. Scottish and Welsh nationalism owes much to this critique not least in attacking the nature of power in Whitehall/Westminster.  

CONTINUED in Renewal 29.2 (2021)

[1] David Edgerton, ‘Britain’s persistent racism cannot simply be explained by its imperial history’, Guardian 24 June 2020.  See also David Edgerton, The Rise and Fall of the British Nation: A twentieth-century History (Penguin, 2019), and the essential Anthony Barnett,  The Lure of Greatness: England's Brexit & America's Trump (London: Unbound, 2017).

Labour didn’t lose its ‘red wall’ – it never had one

ne of the most popular explanations for Labour’s poor electoral performances in both Hartlepool and Batley and Spen is that a mythical group of working-class people voted solidly for Labour until Jeremy Corbyn and Brexit came along. This idea is stubbornly persistent in political analysis, yet it’s bunk. Labour has seen its vote share collapse, both nationally and in these seats, three times over the last 50 years. Indeed, the belief that working-class people traditionally voted Labour has only been true (and barely so) for a mere 25 years of British history, and a long time ago.

Continued in the Guardian 9 July 2021

The worst election result since 1935? a tale of two measures

This is a slightly longer version of the presentation I gave at a session of the Progressive Britain conference (16 May 2021) on Labour and its history, alongside Steven Fielding and Patrick Diamond.

How is one to judge the success of the Labour Party over the past century?   In our Westminster-centric system it is little surprise that success is measured by achieving a majority in parliament.   Only three leaders have achieved that – Attlee, Wilson and Blair.  Labour has only twice been the largest party without a majority – in the 1970s, and in 1929, under MacDonald and Wilson. The 1924 Labour government was based on Labour as the second party. We might also ask who the Labour leaders were who deprived the Tories of a majority, without being the largest party. They were MacDonald, Brown and Corbyn.  Those who have failed to do even this were Henderson, Attlee, Gaitskell, Wilson, Callaghan, Kinnock, Miliband and Corbyn.

But if one is interested in measuring degree of connection with the people, the reaching out, the support the Party received from the British people as a whole, the number of seats, nor the ability to form a government, are a good measure.

The reason for this is obvious and well known, but not well enough understood. It is that in FPTP there is (much of the time, but not always) a wild disproportion between support and seats.   For Labour, the extent and direction of the disproportion has changed radically over elections.  We can put it this way – at certain periods, the main determinant of electoral success for Labour has not been electoral support for Labour, but the quantity and distribution of support for other parties. Labour does not always deserve credit for winning, nor blame for losing.

What is interesting about 2017 and 2019 is that in both cases the seat share was very close to the vote share, for Labour that is. This previously happened only between 1951 and 1959, and in 1923. Otherwise the story of very significant disproportion of votes and seats.  It was extraordinarily negative in the 1930s, especially in 1931, when 30 percent of votes yield 8 percent of seats.  By contrast it was extraordinarily positive in the years 1997-2005.   Labour won a landslide in 1997 with a vote share just lower that that with led to a loss in 1970.

As the 1935 result has been repeatedly referred to recently it is worth looking at a little more. In fact, it was Labour’s best performance in vote share of the interwar years, and saw an increase in the number of seats. Labour got 38 percent of the vote. But it got just 25 percent of the seats.  Give or take one point, 38 percent was the Labour share in two elections in 1974 and in 1979.  In 1974 that resulted first in a minority government, then a small majority government, and in 1979 a  major loss.   That 1935 share was 3 percentage points better than that of 2005, when Labour of course got a majority.  A better share in 2017 than 2005 gave Labour increased seats compared with 2015,  but in 2017 it was not even the largest party.   And in 2019 Labour did better in share than in 2010 and 2015 but worse in seats.  The reason was that for no fault of its own the system and the distribution of support for others, was no longer giving labour more seats than its share implied.

If we take that 1997 vote share as a benchmark, then we can see that Labour equalled or beat that in every general election from 1945 to 1970 inclusive.  In 1997 Blair did as well, but no better, than Gaitskell in 1959, who lost.    The really big Labour successes, with three percentage points more than 1997,  include the famous 1945 election.    But they also include 1951, when Labour had its greatest vote share ever, but lost, and 1966, which is the most forgotten Labour success of all.   

In the years 1945-70 Labour never fell below 43 percent vote share.  Since then it was only exceeded this level once, in 1997, and approached it only twice in 2001, and 2017 with 40 percent.

Since 1945 in terms of vote share ranked by the best performance of each leader has been in the order:  Attlee, Wilson,  Gaitskell, Blair and Corbyn. The worst have been, in decreasing badness, Foot, Brown, Miliband, Kinnock, Corbyn, Blair, Callaghan and Wilson.  Corbyn has been neither the best, obviously, nor the worst.    

This is also true  in term of seat shares. The worst seat shares were obtained by Henderson, MacDonald, Attlee, Corbyn, Foot, Kinnock, Miliband, in that order (excluding 1918).  The best, in order, by Blair, Blair, Attlee, Wilson, Blair.   But, to return to my point: Henderson and Attlee were in 1931 and 1935 massively disadvantaged by the electoral system; Corbyn was not. But Blair was massively helped by the system and Attlee and Wilson much less so.

Looking to the future, how might we reflect on this past? Perhaps this is the way to think about it: there was a unique period from 1945 to 1970 when the vote share hovered between 43 and 48 percent.  This was without question Labour’s great period of electoral, political and social success – the only moment it consistently got a (small) majority of the working class vote.   What needs to be emulated it seems to me is the record of getting support, transforming the country, and keeping support, not least while in office. Labour’s greatest success, tellingly after years of government, came in 1951, when the system turfed it out.  The only other time Labour increased its vote after being in office was in 1966, and that was its second-best vote share.  Labour has not achieved this since.

Since 1970  the picture is very different – since 1970 the electorate has been fickle, but in long waves. Share has oscillated between 43 and less than 30. From 1970 to 1983 there was a collapse in vote share; the same thing happened between 1997 and 2010 (another 13 year period). From the peak of 2017, 2019 saw a major fall. The question is will this continue for more elections, as the record post-1970, and post-1997 suggest?  Will recent history repeat itself, that is,  will the next elections in say 2024 and 2029 get us back to 2010 or 1983?  Let us hope not.