By its nature, the progressive disposition tends to dissatisfaction. We have dreams for a better world, we are angry at injustice, we have a significant belief in the power of government to change things, and we have an optimistic view of human nature. So should we be satisfied or dissatisfied with the last decade, and how should we renew the progressive agenda?
Progressive politics has shown a capacity for economic stewardship in a way it never has before in this country. Public investment has helped to regenerate our public services and create new institutions of the public realm, like Sure Start. Working people have seen gains in income and rights, from tax credits to paid holidays. The ethos of the country has shifted to the left on gay rights, the environment, development, and even taxation and spending.
What matters is whether these gains are the start, or the end. This period of progressive rule was never going to be 1945 to 1951: the big bang. The model for us is surely closer to Scandinavian social democracy: sustained incremental change which knits progressive values deep into the fabric of the country. Why does this matter? Because it shifts the centre ground of politics irreversibly onto progressive terrain. By that standard, there is all to play for.
As many have pointed out, renewal in office is one of the hardest things to achieve. But it is not impossible. It requires some key ingredients. First of all, ethos: shining through from every action and proposal should be a sense of what progressive politics is about. Second, clear priorities: how does progressive politics specifically answer the challenges of building a society with the ethos we want to see? Third, political practice: can we live our ethos through the way we conduct our politics?
The first building block for an ethos of progressive politics must be equality – including a belief that all should have a fair chance to achieve their potential. Part of being in progressive politics is a faith that people can achieve extraordinary things, but they need the right opportunities to do so.
In our pursuit of equality, three particular challenges face us far more starkly than they did in 1997: the challenges of the environment, of globalisation, and of asset-based inequality. In different ways, they make the traditional pursuit of equality more difficult, but they also make the case for progressive politics clearer than ever.
Achieving environmental sustainability requires that markets be embedded within the laws and norms of society, which reflect a set of social and political values. Globalisation shows that government must play its necessary role to ensure that people are not left isolated, and the benefits and burdens are fairly shared. Issues in the housing market call for looking at the potential for giving more of a priority to providing greater housing, in all its forms, and looking at ways of enabling individuals to build up assets.
But, with these greater pressures facing the egalitarian project, the most important area of policy remains education. And though school reform and investment need to continue, creating a more equal society cannot be done in the classroom alone. We know from the past decade that we also need a focus on what happens before children get to school, what happens out of school, and their career pathways after school. That means childcare, youth services and vocational skills must all be greater priorities in the years ahead.
Equality is one part of the progressive ethos. But there is more to the good society than the aggregation of the ‘I’: my health, my education, my job, my house, my pension – important as these things are. The challenge is also to address the wider question of not just what each achieves for themselves, but how we relate to each other and what kind of society we are.
The central idea here is that the good society we believe in is underpinned by us holding a set of values in common, around solidarity and concern for others. Public institutions and practices can help bring people together, build solidarity and connect groups that would not otherwise interact. Sometimes this may be about new institutions, such as better youth services or new public spaces offering cultural or community facilities. Also, it is about how we use and build on existing institutions – schools, health centres, libraries and other public places – and about how government supports third-sector institutions to help build stronger communities.
These two parts of our ethos, equality and community, lead us to a third: empowerment. Compared to 10 years ago, from the private economy to public services to our democracy, people are rightly demanding more control. The decline of deference, raised expectations, as well as the advent of the internet, give people a reason to believe that they can exercise a greater decision-making role in their own lives and that of their communities.
Empowerment is the partner of equality, not just because the distribution of power is one dimension of equality. Our whole notion of equality must be based on a belief about the individual as author of their own life. The distinction between the progressive and conservative story is that we believe individual empowerment is the partner of the enabling state, not an alternative.
Taking empowerment seriously means we need both to devolve more power to local government and to find ways of engaging individuals in decision-making which go beyond a once-every-four-years election. People’s disengagement from the political process must, in part, be explained by a belief that their involvement will not make a difference.
With a firm ethos of equality, community and empowerment, we need to think about how we put these into effect. We need to look at our political practice.
The attraction of the progressive project before 1997 was its sense of empathy: a notion that we, better than the alternative, understood the struggles and aspirations of ordinary families. After empathy comes analysis. We need a story about Britain and about people’s lives which points to the role of progressive politics. And we need candour, being honest about the challenges and dilemmas facing government and our society.
Above all, for a party 10 years in government, we need idealism. The momentum behind debt and development shows how we can build alliances which go beyond government and party to embrace a wider cause and community. We need to do the same on big domestic issues like child poverty, where we need to also tap into people’s willingness to be part of a big movement for change.
What is the real reason behind forging a political ethos of equality, community and empowerment. I would assume that before creating a debate for renewal and change whilst in government, one has to recognise the where the origin’s of the aggregate ‘I’ came to fruit and impact on today’s generation. Thatcherism. The Thatcherite legacy has had a big impact on today’s generation. Her differentiation between long and short term targets on economic grounds provided the very foundation for her boom and bust period in power. The Blair legacy may provide a similar impact at a later time.
Eds specific attack on inequality is very symptomatic of today’s society. It is true that macreconomic reforms associated with Blairs protege Thatcher, arguably by the use of Neo Classical and monetarists policies have contributed to today’s materialistic, selfish and ‘I’ society. Her economic philosophy, some may argue not too distant from Blair’s thoughts, Brown’s thoughts also, is likened to a vast sensitive nervous system which responded to global events. The free market and globalisation also an important of New Labour’s vision, but also as Ed recognises, has its ills on the community.
Following the collapse of the Labour Government in 1979, Thatcher was committed to move the economy away from ‘Keynesian Demand Management’ towards the path of ‘Monetarism’. Jim Callaghan perhaps recognised before Thatcher, that this road was inevitable. The latter, a term coined by Milton Freidman, who sadly died last year, was taken up by Thatcher as gospel. Controlling the supply of money, she believed would solve the root cause of inflation or consumer prices(goods and wages) The problems at this time, high spiralling wages demanded by unions, during Callaghans reign, the onset of the Iran Revolution which impacted on Global Oil Prices contributed to the countries early demise. It would seem that nearly twenty years later some of these issues are raising their heads again.
The promise of a cure for inflation gave Thatcher an opportunity to use the monetarist doctrine to attempt to control inflation. Without doubt her priority objective. Again similarities with Brown and Blair since 1997, whose priority was also the control of the economy.
In March 1980, the Medium Term Financial Strategy (MTFS) was published to target monetary growth (M3) and public sector borrowing. By restricting the supply of money to the rate of growth (GDP), it was hoped it would eradicate inflation. Thatcher envisaged that in order to control (M3)interest rates had to raised. She did so and these remained at record levels for some time.
Gordon Brown on the contrary, (had success coming into power), followed an avenue of arms length involvement by placing independence of control on to the Bank of England. Fortunately the interest rate and inflation has reasonably remained low until the present day. Was this a follow on from the Thatcherite/Major legacy. I believe it was, especially as Clarke the previous chancellor expressed interest in going the same way. It could be said the social inequality, (which you highlight in your lecture), under this Labour Government, has worsened even further.
Thatcher’s experimentation by a monetarist incomes policy focusing on the supply side had severe consequences, disaster for business and industry but on a positive note advantageous to savers due to high interest rates. Gordon Brown has generally favoured helping businesses by emphasising on deregulation.
Back to Thatcher and her government they presided over “the worst economic collapse since the Great Depression“. Gamble A (1985) This statement is in contrast to the intended outcome of Thatcher’s vision of faster economic growth, via tax cuts, private sector investment, ultimately leading to a drop in inflation. Unemployment doubled to 3 million, output of manufacturing industry fell, along with investment, 19 and 36 per cent respectively. This initial period of governing would without doubt, be remembered by many, as a period of bust.
Again, is New Labour about to observe a housing market crash leading to a bust period.
An expected slight rise in unemployment up to 1982 was underestimated by government, as it ascended to an all time high. Demand for consumer articles would have fallen, due to a rapid decline nationally, in family incomes. The lack of purchasing power created by this rise in unemployment, aguably reduced inflation.
It could be said, that Thatcher’s success in the targeting of low inflation was sacrificed for high unemployment, leading to plummeting tax revenues. Her continued philosophy on minimal state intervention, by letting the free market decide would continue regardless of any opposition, to her reforms. Others described low public borrowing relative to money growth, as the rationale behind the fall in inflation.
The long term agenda of Thatcher was to curb the power of the trade unions, privatise nationalised industry and restore the supremacy of market forces . Her hatred of collectivisation and her determination to exchange this concept for individualism, made in particular, the defeat of the coal miners, an attractive option, thus ultimately breaking union left wing pragmatism. The key to her transforming a capitalist society like Great Britain, lay with the successful defeat of the miners in 1984 -85, whereby Hutton, W (1995) says Thatcher wished to fragment the labour market into powerless, divided units, by removing union power at source, hence followed the abolishment of Keynesian economics. The break up of the mining unions into separate entity’s and the closure of coal mines, certainly divided communities and dampened the collective spirit.
The preparation prior to the onslaught of the miners, was cautiously taken with the introduction of Parliamentary legislation, which as Gamble, A (1995) says slowly began eradicating and reducing trade union rights and privileges. Thatcher perhaps had distant memories and a bad experience of union confrontation a decade earlier, during the reign of Edward Heath. The use of stealth was the route taken towards the inevitable clash of ideology with the Marxist President of the National Union of Mineworkers, Arthur Scargill.
Thatcher’s standing within the World Community was enhanced after her 1983 General Election victory. This transformation from an unpopular leader was the result of two important factors as Gamble, A (1995) explains were, “the Falklands War…and the fragmentation of the opposition” The victory over Argentina in 1982 and the movement left of the Labour Party, causing a divisive split within its own ranks, perhaps gave Thatcher more respect internationally and also with parts of her own electorate. The Thatcherite legacy continued to move forward, with the support of the British public behind her.
The movement away from direct government involvement in the running of the economy, buried the principle of state intervention that Keynesian economists enjoyed. Many industries owned by the state in the middle period of the 1980s, in the way of British Gas, and British Telecom were denationalised, by use of monetarist policy and opened up to market forces, providing the opportunity for competitive tendering, whereby the introduction of private investment and enterprise became routine. This doctrine created an individualistic culture where arguably entrepreneurs placed self interest and the pursuit of profit, before anything else. The above coined Privatisation meaning the transfer of assets or economic activity from the public sector to the private sector.
The ‘free economy and strong state’, a term originally expressed by Andrew Gamble (1998), highlighted the dilemma of Thatcherism. This corresponds for a need for the State or British Government, not to interfere in market decisions, whilst at the same time provide protection of the Free Market economy. The liberalisation of denationalised industries, as described earlier, led to the carving up of ex – public utilities into smaller units and sold on.
In 1985, the Chancellor Nigel Lawson had found an alternative method of making the economy work. Kingdom, J(2003) says he prescribed the use of interest rates, which were increased, “to hold down money supply by decreasing borrowing and encouraging saving” Thatcher’s belief in a strict monetarist agenda was perhaps at odds, with the economic decision making of the Treasury. The outcome, created by Lawson was a consumer boom from 1986-89, as Begg, D says was partially due to the falls in the exchange rate and overseas competitiveness. Reduction in taxes and monetary growth on the supply side led to the economy over heating.
The modernisation of public services, through denationalisation, from an anti – collectivist perspective would have favoured, in the short term, reduced public spending and tax cuts, enabling private companies the autonomy to invest. Many consumers, on the other hand, may have experienced a poor quality service and a decline in standards as a result of the importance placed on the fulfilment of the shareholder, in exchange for the delivery to consumers. Thatcher adopted, as Stewart, M (1986) says such supply side measures or microeconomics, to design or make the labour market flexible. It could be said, that the emphasis on money, in the narrow sense, was important to the income in the citizen’s pocket. People would be thankful of a job, if the benefit culture was tackled and made more uncomfortable for claimants to take advantage of. Again Blairite similarities
A success story in the privatisation programme,arguably, in the longer term, as one can remember, was the sale of council houses and the opportunity for families to invest in their own private property, tied up in financial agreements or mortgages. According to Calvocoressi, P (1996) “by cutting credit controls and taxes, Thatcher fuelled property speculation, encouraging the nation to live beyond its means” Access to credit, would have been easier to attain, due to the freeing up and de-regulation of the money market. It would appear nothing has changed with New Labour
The “Iron Lady”, aptly named by her counterparts in the political world, due to her easily recognisable, robust, leadership qualities, may have given the impression to the general public of being a role model for women. Thatcher was arguably openly anti – feminist when calling for a re-instatement of family values, with emphasis on women’s traditional role as a mother and housewife.
The period between 1987-89 the balance of payments plunged into deficit, the result of which sucked in imports, due to poor production of goods on home soil. Although the goods from abroad were cheap, it had the potential of crippling the British economy, due to an expanding differential in money, between imports and exports.
The high point of Thatcher’s period in office, was to observe the fall of the Berlin Wall and the end of Communism in Eastern Europe in 1989. The legacy of Thatcherism and the embracement of the free market, provided a turning point in the ending of the Cold War. Griffiths and Wall (1999) states that Central and Eastern European Countries, “opted for independence and market capitalism” The demise of communism, may have excited and pleased market enthusiasts like Thatcher, where her Monetarist doctrine may have had some relevance and bearing on the outcome.
The Community Tax or Poll Tax was administered in 1990, as a replacement for local rates, commonly renowned as a property tax. This proved to be very unpopular with low income earners and families with more than one adult in any one household (Griffiths and Wall). Public unrest by rioting, showed the amount of ill feeling towards this regressive policy which led to the eventual replacement by the Council Tax.
In 1992 legacy of Thatcher came to a conclusion, when her power was handed over to her successor John Major. Stewart, M (1993) says the governments finances deteriorated, where reduced tax revenues and increased benefits, replaced the period of boom with recession, arguably part of a larger global recession.
Thatcherism provided a long term agenda for economical change. The destruction of powerful unions, her main objective, had a profound effect on steering forward Tony Blair’s Labour Party renewal of Clause IV, a commitment to de-nationalisation. The change of direction away from Keynesian demand management, by rolling back the state, may best be remembered as a nail in the coffin, for the Post War consensus, by reversing the use of state intervention in economic policy in the short term, thus championing monetarist supply side micro and macroeconomics. Her legacy is not just boom and bust, but a change of ideology from collectivism to individualism.
Now, lets take a look at renewal. It is apparent observing the outcome of the recent locals election that the Labour Party is in a bit of a pickle. The British governemt need to be reminded again and again that citizens are not happy with their progress.
It is true the Swedish model of social democracy, has been a success. It has a population of approx 9 million compared to Britains 60 million. In 1991 -94 it had a right wing Government.
Why do people praise such a model so highly.
Well it has seen high economic growth, its inflation has been relatively low.
Its imports are higher than exports whereby it is dependent on foreign trade, Their public services have seen increased investment with a high public expenditure, arguably from a 50% tax hike.
A competetive Business sector private and public compared to Britains deregulated business sector with poor public.
It taxes its citzens progressively.
It has a generally good work productivity.
It provides a safety net of 80% of the workers income
Strong Unions and active Labour Party movement.
From this it is easy to see why Labour are fixated on such a model. But theres more.
In public services they are free at the point of need.
Schools have choice, private but with public funding
It has a good social insurance, which reduces the willingness to pay taxes.
It has a moderate distribution of wealth whch includes a good basic pension.
Unions act for 80% of its workers.
There is good training for the jobless, even workers have good work based education, more responsibility.
Wages are collective bargaining.
The inequalities in income are arguably reduced, whereby income gap is reduced.
The people of Sweden are three times better of by their progressive taxes which are highly distributable.
Most sustainable country in Europe with a low infant mortality.
Social Justice is the driving force behind their growth.
Cheap child care for women to enable them to become more socially inclusive of the Labour Market.
They have a very good environmental policy.
Why do Labour believe that this model is the future
1. Globalisation arguably does not threaten the
Swedish model
2. It creates more equality and life chances.
3 The job market is flexible , whereby it easy to
transfer between employment.
4 They are able to spend more on new
technologies, research and development.
5. Unemployment is low.
6. Young people are needed to pay for pensions
because of an ageing population.
7. EQUALITY WILL BE REACHED BY GROWTH.
CREATED OVER A PERIOD OF TIME, PERHAPS 10
YEARS.
Is this Gordon Brown Vision and Ideas for the future?
Does Social Democracy work in Globalised world?
The electorate seems to think otherwise, thus it remains to be seen whether such challenges will be dealt with by a Labour Government over the next decade.
“The process of explanation is as important as the explanation of the process”
or
“Change of direction is as important as the direction of change”
Ed I totally agree that the question for progressives is indeed “not just what each achieves for themselves, but how we relate to each other and what kind of society we are” and some of Labour’s best achievements have been engaging public services to bring people together to participate in improving their communities. As well as looking for “joined up government” we should also be striving for a “join in society”. What do you think?
See http://www.compassyouth.blogspot.com for an article related to this and http://everydaysocialdemocracy.blogspot.com
But, dear Ed, 10 years ago we also focused on this idealist combo of equality, community, empowerment, education etc etc etc. And people believed us; and we won. Now, apart from the new criticalities of terrorism and the environment, your old combo might seem old wine in an old bottle — though we must nevertheless keep the momentum going and finish unfinished business. But in here, despite our innovative progress in many a front, we’re at least perceived to have slipped on both equality and empowerment.
Not only actual inequality has increased since 1997, we appear to be favouring the rich (and even risking losing the middle class vote)! We not only removed the 10p income tax rate that the very poorest among us benefited from, we also have set the inheritance tax threshold at lower than middle class house-price level in the South and on top of it kept it (rather regressively) at a flat rate of 40%. If we really want to stop the toffs to pass on the hugely unfair advantage of their huge wealth to their kids — ie if we really wanted to promote more equitable life chances for all our kids — we could’ve perhaps lifted the IHT threshold to a million quid and three million quid, being taxed at 40% and 80% respectively. Let’s just see how many people do flee the country : most won’t, because there’s more to UK than IHT. Whereas by doing this, and reinstating the 10 p rate, we’ll at least move towards more equality in a CONCRETE manner (ie not just pious wishes).
And to give back the sense of empowerment to the people who apparently feel increasingly disenfranchised/disillusioned (despite commendable devolutions), our party leaders (at least all the ministers) themselves should be seen to be “whiter than white” again in private, financial, national, and international matters. (We’re sure you painfully remember all those instances where we messed up as we do!) As a door-to-door canvasser, I consistently get this feedback from even our own supporters. PR fudges may help us win the battles, but we’d lose the war otherwise.