There is a delicious moment in Simon Walters‘ account of the William Hague leadership of the Conservative party, “Tory Wars”. Hague has decided to launch an attack on the “Liberal Elite” for tying the hands of the police. Yet when the speech is discussed with Michael Portillo, the Shadow Chancellor objects, saying that he himself is a member of Hague’s derided “liberal elite”.
The story is told against Portillo, the effete metropolitan counterpoint to Hague’s bluff Yorkshire grit, but read in the light of Hague’s defeat and the later Cameron ascendency, you can’t help but feel that the lost leader had a point. The Tories needed a bit of liberalism, though they have somewhat overdone it on the “elite” front.
Reading Steve Akehurst’s interesting article for Shifting grounds, I was reminded of that old story. Akehurst prefers “moderniser” to “Liberal elite” as his defining category, but I suspect the intent is rather similar. I’m tempted to echo Portillo. I’m the liberal elite, moderniser.
That said, I’m not sure I agree with Steve’s precise definition. I don’t care for Louise Mensch much, wouldn’t describe myself as besotted with public service reform -it’s a dull, tedious, complex, politically difficult necessity, more like- and I don’t have a firm view of the salary required to transcend the middle class. Still, behind the caricature lies a truth. I usually describe myself as a Conservative-Liberal-Socialist, pace Kolakowski and today, it is the liberal part of that trifecta which is under most pressure.
As Steve rightly notes, the liberal modernisers are under pressure. Curiously though, their policy agenda appears rather durable.
Perhaps this is because for all the questioning of the philosophical values behind the liberal elite modernisers, we are yet to see a serious centre-left alternative at any level beyond the rhetorical*. It’s the old Brown problem. The language is radical, the rhetoric inspiring, but the policy? Well the policy ends up a notch this way, a belt tighten that, and poor old Neal Lawson has his heart broken all over again.
Take Pre-distribution- in a sympathetic article about the policy consequences of the newly fashionable term, Professor Paul Gregg repeatedly says thing like: “indirect interventions often lack the power to overturn the processes already at work… …In terms of specific policies, there are a number of obvious policy areas but whether they are of sufficient scale to address the forces driving rising inequality is unlikely.. ..attractive attempts to shift inequality in work and wages.. .appear limited in scale or ambition...”.
You get the sense that there is the ambitious and the achievable, and an unspoken fear that never the twain shall meet. Responsible Capitalism? All for it, but how, exactly?
So when Steve argues that “The old modernising consensus has fallen from favour in all three parties mostly because its playbook was forged at a time when the basic questions of political economy were settled. In this respect, it was broadly in tune with public opinion. But the financial crash and the decline in living standards has incinerated most of those assumptions, and meant the old agenda satisfies neither party rank and file nor voters” I agree, but only to a point.
I can make an alternative argument – that despite the attraction of extremes of rhetoric, from the Tea Party to Syriza to Dutch Euro-Sceptics electorates have shown a split tendency – an increase in support on either wing balanced by a gathering together at the centre. So the most likely outcome in the German elections is a grand coalition and Mario Monti is the most popular figure in Italian politics.
Why? Perhaps because even when politicians who are elected on a prospectus of change are elected, they soon seem to adopt a governing policy of grandmother’s footsteps, not radical change. So, for example, Francois Hollande finds himself facing a similar fix to his predecessor. The electorate can tell when you’re trying to bite off more than you can chew.
The left, broadly constructed, have a clear approach to this – one of outright rejection of austerity, extended spending, direct action to lift incomes, preferably through significantly increased tax take. The right, equally, see a series of straightforward causes which can be tackled – immigration, welfare, regulation, taxation. There is even some cross-over between the two positions, most noticeably on immigration. However, such clarity comes at a cost – both politically and practically. There will need to be a period of fiscal restraint. We can’t end intra-EU immigration, and we shouldn’t. For big changes, there are big risks, huge unknowns.
It’s true that for those wrestling with the contest between the ambitious and the achievable, post-crash politics has become even more complex, less easy, and as Steve notes, this has meant stronger challenges, especially on the left.
Perhaps predictably, my particular leftish branch of the liberal elite threads a needle through all this. Pro-deficit reduction (when growth returns and at sensible rate). Support for private sector growth (at the price of sustained tough public spending constraints), conditionality and contribution to reduce pressure on Welfare bills, changing universality to focus on moments of new life costs, and so on. So to take the most direct example, I’m supportive of increased tax take from the wealthy, perhaps through asset taxation, but sceptical that you can take enough from this source alone to reform capitalism or re-order society**.
So here’s the funny thing. While Steve is absolutely right that the rhetoric and political pressures have turned against the “modernisers”, the policy agenda has not.
When it comes down to the hard tacks of political decision-making, faced by the limitations of national government power, relatively open trading economies, and the basic framework of social market capitalism, it turns out that not only are the liberal elites still determined modernisers, most of their rhetorical critics are secretly modernisers too. The direction of travel is remarkably similar – even pre-distribution is not much different to post-neo classical endogenous growth theory, though with a greater focus on incomes, which few in the liberal left would object to.
Once the rhetoric is stripped away, the common ground turns out to be the “achievable”. After all, what else would actually stand a chance of working?
If I may permit myself a raised eyebrow, it sometimes seems to me that the discontent on the soft-left about our current policy quietude is a consequence of a certain unwillingness to deal directly with this uncomfortable fact about their own political identity. It’s not that the true differences between right and left aren’t important- they are, ever more so in these times. The choice between deficit reduction now and deficit reduction in a year is a real and vital one. It’s just that they do not span so great a gulf as we partisans like to imagine.
To go back to Mr Portillo, you are the liberal elite too. So perhaps we can come up with something constructive together. To return to a regular theme of mine, a certain modesty of aims suits both soft left and the liberal left alike. For the likes of me because we believe in it, for others because the proof of the political pudding is in the legislating.
After all, if we want to convince people of the efficacy of collective action, it is best we first demonstrate where it makes a clear, successful difference, thus convincing the sceptical of our essential socialist claim that “it is absurd and hypocritical to conclude that, simply because a perfect, conflictless society is impossible, every existing form of inequality is inevitable and all ways of profit-making justified”.
That way, the centre-left get to embrace their hunger for ambition, and the liberal-left get to focus on our dear old mantra- what matters is what works. Oh, and if recent elections are any guide, my beloved soggy middle is still managing to squeeze out election victories, which does rather help.
Stronger together, and all that.
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* The right has their own problem in this regard, with a whole series of impossible desires getting in the way of actual Conservative reforms. Lets abolish regulation! A grammar school everywhere! Let’s quit the EU! These often seem a happy Tory daydream, not a practical political agenda.
**I confess to being significantly more liberal than the electorate on immigration, by the way. I’m allowed one topic on which I’m fairly unpragmatic. Bloody immigrants coming over here, creating wealth and paying for our pensions. Though even here, I try to square the circle by supporting a points based system that at least rationalises our choices.
Well said.
Actually, it seems to me that the greatest crime that many feel the modernisers committed was to win not just an election but three.
Nothing clobbers the claim that “we didn’t win because we weren’t left wing enough” harder than winning.
Thanks for the response. I think it’s very fair. The trouble is it seems to rest on a premise of pragmatic, open-minded centrists who are just waiting to build a constructive alliance around the soft-left’s agenda if only we could realise how similar we all are. But that isn’t necessarily the case at present. The point is, just like anyone else, you guys have political prejudices and predilections – a comfort zone – which shape what you deem to be “attainable” or desirable. And it’s these (instincts, mostly) which I think lead to genuine real differences in policy or priorities to the soft-left, more so than you suggest in your post.
For instance, you’re right that there has been a lot of bloviating over the ‘end of neo-liberalism’ which is not always backed up with policy of commensurate scale – and as I wrote, I think this is particularly a problem with EdM at present. But there are still some ideas floating around on the soft-left, if not all endorsed by the leader himself. Off the top of my head:
- National investment bank
- Regional banks
- FTT
- Restoring 50p top rate of tax
- Mansion tax
- Pay multiples
- Rises in the minimum wage or targeted rises in sectors with particularly depressed wages
- Changing procurement rules to better favour UK based firms or industry
- Restricting rental increases in the private rented sector by pegging them to inflation, for instance.
None of these are revolutionary, I take the point – and they need to be built on. But all are attainable, and all are workable – many have been tried in other countries, and taken together they could at least get us off in the right direction. A good place to start the alliance you speak of? Yet most of them have been met by with a very lukewarm response by what you term liberal modernisers; many are more or less dismissed out of hand, sneered at or met with a weary roll of the eyes. They seem to make many instinctively nervous, or the critique just doesn’t chime, so they are simply dismissed as unworkable or unsellable. Not necessarily the case.
Likewise, regarding Hollande, there is a lot of effort to say that windy campaign promises have been hit by ‘reality’. But he always campaigned on reducing the deficit. Despite his supposed caution, he is also introducing a 75% top rate of tax, boosting state spending on schools, nearly doubling CGT on property, reducing the pension age, bringing in taxes on large banks and energy companies, and so on.
Are these something you’re up for looking at in a UK context? If so, great, but I imagine if EdM got up at conference next week and announced something similar, there would be a great deal of awkward shifting in seats from certain circles, tweeting and murmuring about how this is terribly ‘anti-business’, ‘anti-aspiration’, ‘old labour’. All the things that instinctively met his responsible capitalism speech last year, for instance. You say that there is agreement on this theme now – but my recollection is the mere mention of it as a concept made many on the right of the party feel very queasy indeed. It is just not a critique they agree with, it seems – before we even get to policy, which is out of hand dismissed as unworkable or not new enough. Likewise, on opposing austerity.
As I said, there is a pretense in your post that genuine transformation of the economy would be desirable, if only it were actually attainable. But how much time is spent on this by you guys? Pick up The Purple Book, for instance. I really enjoyed it, and really like a lot of people who put it together and wrote for it. But at the end it has 10 pages of recommendations for reforming the state and public services, and 1 on reforming the economy. Is this really where we are as a country? Is this where the public is in terms of priorities? Compass, for instance, to be fair to them, have been clear and reasonably radical on what they think on banking reform. This does not strike me as issues which you many of you guys seem that comfortable talking about, for instance.
So in short, I agree that an initial modesty of aims is a good place to start, and that many on the centre-left need to tone it down a bit. But there has to be a bit more genuine open-mindedness on the other side, too – and a recognition that some of the moderniser playbook is based on a mix of psephological and ideological dogma from a specific point in time now long past, rather than a pure appraisal of the facts.
Sorry, this has become almost as long as the post itself!
Thanks again for responding.
Steve
this:
“- Changing procurement rules to better favour UK based firms or industry”
is pretty revoluntionary if you consider we’re in a single market – the purpose of which is to specifically prohibit such actions. So you’re advocating withdrawal from the EU then Steve – either that or a renegotiation (and that’s working so well for Dave)
I have a bit of a problem which the rush to buy locally – if local is more expensive then it the gains to the local economy may be wiped out by the fact that buying local also means buying less. Also – if everyone buys locally then our exports are screwed.
This is an issue not just in international trade but domestically – I keep seeing local govt urged to buy locally without any analysis as to which services and products local companies are selling outside of their local area. Again buying locally can mean losing exports as well as stopping imports – it only works if you’re the only ones buying locally.
The best way to make sure british industry wins is to look at what we can do to make british industry better and I’d go down the skills and research route there than the route the tory right want to take – which would be to make employment cheaper. One thing is for sure though – protectionism just doesn’t work.
With regard to the EU rules on procurement, it’s worth noting that there is room within the rules to still favour UK procurement. I believe that Vince Cable has similar plans in the pipeline so it’s really not that controversial.
Personally I don’t accept the claim that “protectionism just doesn’t work” because it simply isn’t true. It’s a well documented fact that almost all major economies used protectionism for the purposes of developing their economies. A more accurate qualified claim might be “protectionist policies are of limited use for developed economies at the technological frontier”
I agree with you to a point, for example, I would like to see capital gains and corporation tax jacked up to far higher levels but I’m aware that doing so would be of little good because many large corporations would simply use a bit of creative accountancy to shift their tax obligations elsewhere so I really don’t see my fantasy tax plans seing the light of day.
However, I think there’s also a question of intent. If we take some policies where there would have been a little more room for manoevre such as private sector involvement in public services and projects, here we see far clearer differences between the soft left and the modernisers with the modernisers far more keen to embrace the private sector.
I think ultimately while there is a valid point in what you’re saying I think that the soft left and the modernisers want to take the country in quite different directions which is why I think that a moderniser isn’t just a soft leftie who’s thought about the consequences.
Andreas – in a way I would say your instinct on CGT and corporation tax bares out what I said in my initial response above. You automatically assume it is not possible or will lead to companies shifting obligations elsewhere – but many EU countries have corporation and CGT rates higher than we do, and that is not their experience in the most part. You present this as a nuetral, ‘the way it is’ judgement on what is attainable but it is a highly political/ideological assumption (and as a result you dont give the idea a proper hearing).
And it’s those kind of assumptions which underpin a genuine difference in soft left and centrist policy priorities and proposals – you point to this difference in the rest of your post, and I think you’re spot on. To adapt that often smugly cited aphorism, a centrist is not a soft-leftie ‘mugged by reality’; they have a very different set of political instincts and assumptions. Point of my original SG article was that I think those instincts, once dominant in all parties, are now out of step with their members and with most voters.