Read Jon Cruddas' Summer Lecture in full
We are at a historic turning point. The electoral successes of the last decade have been unprecedented, but underneath lies a deeper story – of profound economic and social change and the breakdown of no-end of assumptions and political orthodoxies.
Put simply: what does Labour stand for any more?
There are plenty of initiatives and announcements, but no sense of animating purpose - and thus, as yet, no compelling case for re-election. Whether Labour remains in government or returns to opposition, we need a fundamental re-assessment of its identity - the kind of society it hopes to build.
Why? Because such periods economic and social change produce major political re-alignments.
This creates opportunities for Labour to reach out and join new coalitions yet it also spells real danger. To survive and grow we must anticipate such changes. At such times, we need a sense of our own history. Not just the electoral success and failures of the party itself, but a history of our own ideas and how they have shaped the party.
First, consider what Labour has lost- its traditional class, its paradigm and its optimism.
From constituency meetings attended by dwindling numbers of committed activists; up through the council chambers of great cities that we no longer govern; up through the dazed and disorientated Parliamentary Party; and to the very centre of government, one thing is increasingly clear. A sense of loss pervades the Labour Party. It is almost palpable. Not just of power sliding away, but a more profound loss: one relating to our essential mission - our very identity.
To start with, consider two losses.
First, the politics of Labour has been fundamentally altered by radical changes in the working class, its culture and institutions over the last four decades. Fifty years ago Raymond Williams published a short essay called ‘Culture is Ordinary'. It begins with an elegy to his working class boyhood in the farming valleys of the Black Mountains and the generations of his family who had lived there.
It is a beautiful piece of writing- poetic and humane. Williams describes a way of life which emphasized neighbourhood, mutual obligation and common betterment. It is a story of pride and dignity familiar to the core of the Labour Party. It is central to our historic identity and our resilience; it gave us meaning. Williams knew that this culture was shaped by the underlying system of production. He recalls how from the mountains he could look south to the "flare of the blast furnace making a second sunset."
He wrote at a time when his class was already undergoing momentous change, but he could not have imagined the day when there would be no second sunset. After that, what would come next? The question remains.
Consider a second loss - Anthony Crosland's model of social democracy. The Future of Socialism (1956) was for many of us always out there on the horizon - a revisionist answer to orthodox Marxism whilst also an assault on the foundations of market economics neo-classical theory. It was an intellectual cornerstone for a social democracy built on tax receipts from capitalist progress, an interventionist nation state and of class reconciliation through growth.
It was dealt a near fatal blow when the Labour Government went to the IMF. Gordon Brown re-invented a derivative for New Labour privileging the City and the financial markets and skimming their profits for the Exchequer.
That model is now lost. Fifteen years - sixty uninterrupted quarters of growth - have gone. We were able to swerve around the big distributional issues - and indeed the laws of politics - given the supposed end to boom and bust. We are now six quarters into a politics for more austere times. And despite the heroics of the Treasury, within the government more generally the sense of loss is acute. What comes next - silence.
Now consider a third loss - our optimism.
Unwittingly, the most telling description of what New Labour lost was contained within its own bible: Philip Gould's The Unfinished Revolution. He makes a revealing distinction when he described his parents as having "wanted to do what was right, not what was aspirational".
The possibility that these two categories were not mutually exclusive was never entertained.
It is hardly surprising that in the psephological models Gould invented to map out New Labour's route to power, such as Mondeo Man and Worcester Woman we find our old friend Rational Economic Man resurrected in modern garb - the foundation of right wing political economy through the ages.
In this view of what it is to be human, aspiration consists of the impulse to accumulate and consume without regard to the consequences for others or any sense of responsibility to society as a whole. Here people are considered as individualistic, unsentimental, ruthlessly self-interested; that the electorate - or at least the section of it that counted - held fast to a rationality that verged on the misanthropic.
By 2001, New Labour's policies were essentially based on a mythical ‘Middle England', drawn up by the pollsters and located somewhere in the South East, built around continuous growth and affluence and where politics always had to be individualised.
A leading Cabinet member claimed that Labour's essential message was to help more people ‘earn and own'. We believed it would only respond to a sour, illiberal politics about consuming more, rather than deeper ideas; of fraternity; of collective experience; and what it is we aspire to be as a nation. To put this simply, we assumed the worst of the British people. But this viewpoint was neither accidental and for certain it was not original.
Thomas Hobbes, for example, assumed self-interest to be the only guiding principle; kindness a virtue for losers. Think the rationality of classical economics. Think the Selfish Gene. Think Ayn Rand. Before his death Michel Foucault wrote a series of brilliant lectures describing how this type of political economy becomes ‘biopolitical'; how its hollowed out conception of the human being - In terms of what we aspire - comes to be seen as natural.
A number of things flowed from our embrace of these assumptions. The idea that voters could be persuaded that higher taxes were a price worth paying for an improvement in public goods was dismissed. Even tax rises for the very richest were ruled out, since every rationally aspiring voter hoped to reach the top income bracket and might one day get stung.
Public and open recognition of the redistribution of wealth and income was out. New Labour, we were told, was "intensely relaxed about people getting filthy rich". From the mouth of Mandelson, we got the wisdom of Mandeville: private vice is public benefit.
And at the end of that road, lay a completely empty vision of centre-left politics, where aspiration would be reduced to a notion of acquisition, materialism would be all we had.
What we lost was optimism.
Richard Rorty once wrote that "the best way to cause people long-lasting pain is to humiliate them by making the things that seemed most important to them look futile, obsolete and powerless." This is the experience many ex-Labour voters describe. To use dry terms like disconnection is to underestimate the seriousness of what they feel:
Real pain and loss; because the very optimism of progressive politics appears to have been lost from a party that, at its best, was once a byword for it. The psychoanalyst Erik Erickson once said, quite simply, that "hope is the basic ingredient of all vitality". It is hope that has to be rediscovered - through a renewed optimism.
Now consider The Three Crises of Labour
Consider the popular vote of the party at every election since 1900. The conclusion is straightforward. Labour has faced two periods of real crisis and now stands on the verge of a third.
The first followed the crash of 1929, and the collapse of the second Labour government as MacDonald, Thomas and Snowden entered the National Government.
The second came with Labour's loss of power in 1979, the Thatcherite ascendancy and our threatened eclipse by a new third party in the early 1980s.
Now, a third crisis is imminent. If the decline in Labour's fortunes since 1997 continues, this latest watershed will occur following next year's election - and history suggests that it will be every bit as dramatic.
It took nearly 15 years for Labour to return to power following the first two crises and the resultant election defeats of 1931 and 1983.
What the graph shows is that the history of Labour since 1900 is a story of a birth and three crises. Each of these four key moments occurs at periods of profound economic change. The formation of the party came during the change from the Victorian to the Edwardian era.
The three political crises that have defined so much of Labour's story immediately followed the fundamental economic turning points of the next 110 years:
-The Wall Street Crash
-The destruction of of the post-war consensus, and emergence of neo-liberalism
- And, to bring things up to date, the global economic collapse of 2008.
The graph also shows us a strong inverse relationship between Liberal and Labour voting shares at these historic pinch points.
At every major historic turning point over the last 110 years there have been major political re-alignments; the birth of new parties, the death of others and the forging of new coalitions.
Now if you look through the writings of various ‘long wave' theorists- Schumpeter, Hyman Minsky, Kondratiev - they all link periods of economic and social crisis to periods of major technological change and financial speculation. All tend to focus on the 1890s, and 1929 whilst later disciples highlight the late 1970s and September 2008. Carlota Perez for example, historically highlights how these ‘Turning points' create political openings for social democracy.
Where a new politics of equality, sustainability and well-being become feasible; a new Golden Age. But feasibility is not necessity - and even if there is this possibility, the forces of selfish individualism can entrench their position. Perez says we are at just such a turning point now.
Yet we should be very cautious here. History also tells us that since its actual birth, Labour has a terrible record at such turning points - of 1931, 1979, and here today since 2008 - indeed they tally precisely with its 3 moments of crisis. Is this because from its very inception Labour has been plagued by a fundamental fault line between its orthodoxy and radicalism which is especially acute at moments of crisis?
I would suggest also - that this is not a left - right factional split but it is about building a radical agenda that can shape such historic moments - think for example of Margaret Thatcher. This tension can be detected throughout the history of the Party - in the frustrations of our leaders at times of retreat. Soon after its formation, Keir Hardie argued that Labour had "its conscience dulled by lust of power to that sense of justice which is the salt of national life, it reels towards its doom". Twenty Five years later Tawney describes - after retreat in national government - how the government "did not fall with a crash, in a tornado from the blue. But crawled slowly to its doom". His words echo down from the past - through Bevan, Kinnock and indeed early Blair when railing against party orthodoxy.
"The gravest weakness of British Labour is... its lack of creed. The Labour Party is hesitant in action, because divided in mind. It does not achieve what it could, because it does not know what it wants". There is, he says, a "void in the mind of the Labour Party" which leads us into "intellectual timidity, conservatism, conventionality, which keeps policy trailing tardily in the rear of realities."
So where do we go?
Let's start with a return to our relationship to other traditions - notably liberalism.
It is wrong to think of socialism as a tradition that stands in opposition to liberalism. Yet we need to be very clear about which aspects of the liberal tradition Labour can usefully embrace as its own. Mark Garnett identified two rival modes of liberal thought; one he described as ‘fleshed-out', the other ‘hollowed-out'. In its extreme laissez-faire variant, classical ‘hollowed out' liberalism assumes a model of human behaviour that is rational, acquisitive and ruthlessly self-interested.
In contrast, ‘fleshed out' New Liberalism was developed by the idealist philosopher T.H. Green, and taken up by L.T. Hobhouse and J.A. Hobson; it was optimistic. Hobhouse said: "We want a new spirit in economics - the spirit of mutual help, the sense of a common good. We want each man to feel that his daily work is a service to his kind, and that idleness and anti-social work are a disgrace."
These thinkers are rightly considered to be pioneers of the British tradition of ethical socialism. Their influence over the leading Labour intellectuals of the early twentieth century - Tawney, Cole and Laski - was both profound and freely acknowledged.
The New Liberals did a great deal to change liberal assumptions in a progressive direction, but their ideas were always contested within that tradition. The efforts of the Orange Book faction of the Liberal Democrats to restore the principles of classical liberalism show that they still are today. At a rhetorical level New Labour certainly talked in suitably fleshed-out terms about the need to restore community spirit and create a more inclusive society. It also acted to strengthen public services, tackle poverty and end social exclusion.
My contention is not to deny the many great things achieved by the government, nor the commitment of its representatives. But if New Labour at its best embodied the high aspirations of ‘fleshed-out' liberalism, its restricted understanding of the scope for change betrayed the cynical assumptions of its hollowed-out alter ego. It talked quite rightly about the need for the party to broaden its appeal to win the support of ‘aspirational' voters, but equated aspiration with nothing more than crude acquisitiveness.
This sucked out its optimism and its radicalism - yet that reality was disguised by the proceeds of growth.
There is much discussion in and around Labour about rebuilding its relationship with Liberalism. However a real danger exists in seeking to reunite the wrong elements of both - of reuniting the worst elements of New Labour with hollowed out classical liberal tradition. Yet alternative traditions have always existed; in Labour, Liberalism and far beyond.
Ones which are more optimistic. It is not the world of selfish beasts and Thomas Hobbes; of selfish genes, atomised exchange, neo-classical economics - the aspiration to ‘earn and own'. It is the world of the individual embedded in social relationship dating back to Aristotle; a world of fraternity and empathy.
In literature consider the Romantics criticisms of the rationality of market economics. In politics it spans Rousseau and the early Marx, Keir Hardie and our own non-conformist tradition; of ethical and indeed faith based socialisms. Less scientific, more a language of generosity and kindness; very much alive within much contemporary debates within psychology, sociology and neuroscience.
Less Ayn Rand more David Hume. It is also a tradition at work within radical Liberalism. It is a politics of fellowship and solidarity and a sense of obligation to others. It would recognise people's need for security, to feel a sense of belonging and the experience of respect and self-esteem.
Where public services that thrive on an ethic of care. With a civic culture that rewards generosity; a society that values reciprocity over competition - it nurtures what Bevan used to define as serenity. Yet as the late G.A. Cohen argues in a book published posthumously, Why Not Socialism?, the problem is one of design. The technology for giving primacy to our acquisitive and selfish desires already exists in the form of a capitalist market economy.
But we have not yet adequately devised the social technology capable of giving fullest expression to the generous and altruistic side of our personality. That is the main task of the future left. It means new political alliances. Alliances of this kind are not at odds with Labour's traditions. Think of our support for the radical elements of the 1906 Liberal government; think of Sir Charles Dilke unofficial chair of the ‘social radicals'; think of the influence of social liberalism on the 1945 Labour Government.
At its best, Labour has been at the heart of broader social and cultural movements. Again, think of Hardie and his alliances with suffragettes, anti imperialist struggles, peace movements and colonial nationalism. Later think of 1945, then the major liberal initiates of Labour from 1964-1970; think of the coalition secured by Blair from 1994-2001. It is when Labour's orthodoxy wins out that it retreats from such movements - often at moments of crisis.
But what might be the programme?
Let's start with four pillars: Equality, Community, Sustainability and Democracy.
We stand for equality because it is the precondition for the liberty of all and that is about social justice. The more resources you have the more courses of action are open to you. As Richard Tawney argues, liberty is "equality in action".
The American economist Robert Frank details how higher inequality leads to increasingly extravagant expenditure and consumption patterns at the top. This creates "expenditure cascades" and "positional arms races" that drive up the cost of living for middle class consumers. The motivating force behind this dynamic is not envy, but the desire to keep up with changing norms of consumption and lifestyle being driven from above.
Also think how the impact of inequality on the poor affects the well-being of others. Collapsing social mobility has created an underclass that is acutely aware of its poor economic prospects and seeks various forms of escapism to compensate; some benign, many malign.
As such we must seek equality of human dignity and moral worth. In a society based on the principle of fellowship, no group of individuals should be so rich or poor that they are able or forced to live as a class apart.
The aim is not to impose uniformity of material condition. It is a society in which differences of wealth and income are contained within limits that allow the individuals to relate to each other in a spirit of mutual regard.
This lies behind the thinking of the Compass High Pay Commission - of which you will hear a lot over the coming months. It lies behind the need for greater tax justice where we all contribute fairly. It lies behind the need to close tax havens. A radical overhaul of the system to build a more equal distribution of income and wealth. It lies behind reasons why we should index link benefit levels, pensions and the minimum wage to movements in average incomes. It is why we must intensify efforts to end child poverty. It lies behind support for the Equality Bill. And the need to reconsider a graduate tax. It lies behind the need to defend and redefine a European Social Model under attack in the European Court of Justice. It lies behind why we should have a Fair Employment Clause in all public contracts - to use the power of procurement to challenge race, class and gender inequalities amongst the working poor. It lies behind windfall and transaction taxes and resetting capital gains tax.
Before the Autumn Statement, Compass will launch a radical programme to reconfigure tax and expenditure plans in a search for greater distributive justice.
Karl Polanyi described the "double movement of capitalism". On the one hand the market destroys old social networks and reduces all human relations to commercial ones yet on the other is the "counter tendency to defend human values, the search for community and security".
Community brings together equality and liberty because it is about fraternity and interdependence. Community is a rejection of the logic of the market. It is about the mutual nature of human relationships: "I give because you need".
We no longer live in communities in which people share the same customs and culture. But the ideal of community with its ethics of reciprocity and solidarity remains as powerful as ever - especially at moments of crisis. We seek a mutual respect that grants self-esteem, and creates a sense of belonging.
Today neuroscience and research into brain development confirm their view that human beings only fully develop and flourish within social relationships. This reasoning lies behind the need to build the care economy, for all generations, at a local level with a special focus on early years, support for carers and the elderly.
It lies behind the need to a housing crusade - rebuilding the mixed economy through massive investment in social housing as nearly five million are in need of a home for rent. It lies behind the need to genuinely free up local authorities to borrow and invest in local priorities. Local bond finance for local infrastructure. The reform of local taxation. Too often centralised funding streams and prescriptions have warped our search for equality.
It means we need to reconnect the excluded and rebuild trust across communities - for example a regularisation of those who have no status and suffer appalling poverty and degradation from landlords, employers and criminal gangs. It means great help for those communities - often the poorest - who have experienced tremendous change through unparalleled levels of immigration. Off the radar of Westminster who remain attached to a completely out of date census.
This search for community and security also implies a new covenant with the military - to improve the working lives of service men and women. More mental healthcare, equipment, housing and support for our veterans. Why not pay for it by scrapping Trident. It implies more front line policing, more youth outreach centres and an expansion of restorative justice and family conferencing.
Global warming is threatening the planet. We are approaching the ‘topping-out point' of oil - the peak of production, after which nothing. The world is facing a crisis in food production and widespread shortages of water. The politics of climate change shows that our inter-dependency goes beyond our fellow human beings to include the Earth's biosphere.
Stern highlighted the "the greatest market failure in human history". Young people are already joining up these dots. They are joining and leading the emerging climate movement.
Like the early socialism, the new ecological movements are making politics personal and moral. They are asking the important questions about the ways we live and what it means to be human. We need to marry up the core values of the greens and the Labour movement and join the dots between democracy, equality and ecological sustainability. The ecological crisis, like the economic crisis is hitting the people Labour was founded to protect. Social democracy must be built on sustainable foundations and global economic recovery has to be low-carbon. Transforming economies needs strong, strategic state intervention.
By harnessing the wind and the waves, we can move toward energy independence. We can build on the ingenuity in our universities and the skills of our graduates to create millions of new green jobs and restore the place of British manufacturing in the world.
It lies behind support for Ed Miliband and his progressive targets and installation targets. It lies behind the Green New Deal, creating employment opportunities for young people. Why we should ensure that by 2020, the UK is generating at least 15% of its energy - heat, electricity and transport - from renewable sources. Why we should introduce tough new emissions performance standards for power stations. Prevent unsustainable aviation growth wiping out carbon reductions made in other sectors by ending the expansion of UK airports - including the runway at Heathrow. It lies behind creating a new green industrial activism for the 21st century. It lies behind developing an integrated transport policy. It's what lies behind why we should commit Britain to an unprecedented civil mobilisation against global warming.
To build equality, to create community, and to secure a sustainable future we must strengthen our democracy. We need constitutional change and proportional representation - to push power out of Whitehall and closer to the people.
The economic crisis partly arises from the failure of democracy to properly regulate the banks and markets. We should consider mutualising those parts of the finance sector currently under state control and learn from Australia regarding new forms of regulated superannuation.
Our public services need democracy, the choice agenda is not enough. The economy and our workplaces need democracy. Business and industry must be accountable to their employees and wider stakeholders. Wider more resilient forms of share-ownership are necessary. This lies behind the need for a radical economic democracy - for example a universal banking obligation with new institutions to offer decent financial products to all of our communities, controls on usury and a Credit card Bill of Rights for consumers.
To return to where we started.
Raymond Williams one said: "To be truly radical is to make hope possible rather than despair convincing". Many now feel despair. We feel great loss. The things that we took as given have abruptly gone - like growth. At such moments hope is key to avoid despair.
Our history tells us that these turning points are dangerous moments; if we retreat. We must contest this turning point. We can still win. My argument is not simply an argument about Labour; this is not about internal issues. Think for a moment about the Tories.
Earlier I talked about how declining economic growth has lost Labour its revisionist mode. But this is the same for the Tories. Cameron's ‘Progressive Conservatism' was built on the assumption of sharing the proceeds of growth; that the Thatcherite early 80s resolved all the issues of economics. Yet when the first economic storm clouds gathered they retreated.
Think about what is emerging. Think about how despite the empathy everything coming out from the Centre for Social Justice is punitive. Think about the party of Daniel Hannan. Not some side show but a man whose central philosophy is hardwired into the mindset of the young Tories. Think about their laboratories in Hammersmith, in Essex and in Barnet. It tells us of the brutality that lies ahead - the notion of ‘easycouncil'; of social care and housing cuts in west London; of a fundamental assault on local authorities wrapped up in the language of quangos. Just think of this weekend's stories of regionalised benefits, mass privatisations and across the board cuts. Last week they signalled a moratorium on new house building. Look who leads their group in Europe. Think and explore the Wisconsin benefits model. Look at the glint in there eye when they talk about cuts; the relish.
Why is it that after a summer in which the Tories have shown their true colours, we have barely laid a glove on them? Why is it that this Thatcherism has grabbed so easily the mantle of progressivism?
I would suggest it is because we have lost our language, our empathy our generosity; because we have retreated into a philosophical framework of the right. This is not an internal debate at all. It is about protecting the most vulnerable through proudly defending a notion of a modern social democracy It is only be returning to our traditions, our language and our radicalism that we can confront this very dangerous force; build an authentic political fight built around a fundamentally different approach to society and humanity.
We can still win.
Consider two final quotes
"Believe in the possibility of building up a sane and ordered society, to oppose the squalid materialism that dominates the world today, and to hold out their hands in friendship and good will to the struggling people everywhere who want only freedom, security and a happier life".
And try this:
"A nation for all the people, built by the people, where old divisions are cast out. A new spirit in the nation based on working together, unity, solidarity, partnership. That is the patriotism of the future. Where your child in distress is my child; your parent ill and in pain is my parent; your friend unemployed or homeless is my friend; your neighbour my neighbour. That is the true patriotism of a nation".
One was Tony Blair in 1994, the other, The Manifesto of the Labour Party in 1923. We need to rediscover that spirit of social democracy. It is an imperative - or else we will go down to catastrophic defeat and deserve to.
Or else millions of vulnerable people will suffer at the hands of a nasty, extremist party that lies just beneath the veneer.
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