Labour can now seize its mo­ment

Bri­tain is ex­pe­ri­enc­ing a once-in-a-gen­er­a­tion po­lit­i­cal sea change, and the Tories know it only too well

The Guardian Weekly - - Comment&debate - Larry El­liott

Jim Cal­laghan would have had some sym­pa­thy for Theresa May. Back in 1979 when Mar­garet Thatcher was on the brink of power, the Labour prime min­is­ter summed up what it was like to feel au­thor­ity slip­ping away. “There are times, per­haps once ev­ery 30 years, when there is a sea change in pol­i­tics,” Cal­laghan said. “It then does not mat­ter what you say or what you do. There is a shift in what the pub­lic wants and what it ap­proves of.”

This was not the par­al­lel with the late 1970s that the Con­ser­va­tives were hop­ing the pub­lic would recog­nise. In­deed, all the old favourite tunes were sung lustily at their con­fer­ence: run­away in­fla­tion, over­mighty union barons, the run on the pound, the bailout from the In­ter­na­tional Mon­e­tary Fund and of course the Win­ter of Dis­con­tent. Speaker af­ter speaker warned vot­ers of what would await them should they be daft enough to elect Jeremy Cor­byn as prime min­is­ter.

Much to the hor­ror of Tory min­is­ters, as they sought to con­jure up mem­o­ries of a dystopian 1970s, how­ever, Cor­byn seems to bet­ter ar­tic­u­late the new mood than they do. The at­tacks on Labour, cou­pled with the cher­ryp­ick­ing of some of the op­po­si­tion’s poli­cies – from build­ing more coun­cil houses to a cap on en­ergy prices – were a com­pli­ment to Cor­byn, who is taken far more se­ri­ously by the Tories than he was be­fore the gen­eral elec­tion. In Brighton, the mood was up­beat. By con­trast, the Con­ser­va­tives in Manch­ester acted as if they had lost. Which, in an im­por­tant sense, they have.

The free-mar­ket think­tank Le­ga­tum pub­lished the re­sult of a poll test­ing pub­lic at­ti­tudes, and was hor­ri­fied to find that vot­ers – in­clud­ing Con­ser­va­tive sup­port­ers – strongly sup­port na­tion­al­i­sa­tion of rail, wa­ter, elec­tric­ity and gas. When the pre­ferred ad­jec­tives to de­scribe cap­i­tal­ism are “greedy”, “self­ish” and “cor­rupt”, it is easy to see why Le­ga­tum con­cludes that the cap­i­tal­ist brand is in cri­sis. Against that back­drop, brand­ing Cor­byn a 1970s Marx­ist throw­back or bang­ing on about his sup­port for Venezuela is not go­ing to cut it.

His­tor­i­cally, there is noth­ing sur­pris­ing about the cur­rent dis­con­tent. There have been three colos­sal eco­nomic shocks in the past 100 years, and each has led to a po­lit­i­cal shift. Post­war wel­fare states in the UK and else­where were the re­sult of the Great De­pres­sion. The pri­vati­sa­tion and lib­er­al­i­sa­tion agenda of the new right emerged from the wreck­age of so­cial democ­racy, over­whelmed by in­fla­tion in the mid-1970s. Then in 2008 global cap­i­tal­ism had its near-death ex­pe­ri­ence, and only sur­vived be­cause gov­ern­ments used tax­pay­ers’ money to bail out the banks. The fail­ings of a model built around dereg­u­la­tion, debt and a shift in eco­nomic power from labour to cap­i­tal were bru­tally ex­posed.

The fi­nal piece of the jig­saw was pro­vided by Brexit. Had the vote gone the other way in June 2016, Cameron would still be prime min­is­ter, the Con­ser­va­tive party would have re­mained united and the fun­da­men­tal weak­nesses of the UK econ­omy could have been pa­pered over for a lit­tle longer. As it is, the ref­er­en­dum vote has done Labour an enor­mous po­lit­i­cal favour by un­leash­ing re­sent­ment at a rigged eco­nomic sys­tem.

Brexit will also mean fac­ing up to the long-term prob­lems of the econ­omy: a chronic bal­ance-of-pay­ments deficit, the con­cen­tra­tion of growth in one cor­ner of the coun­try, the dearth of in­vest­ment and a grow­ing pro­duc­tiv­ity gap with other de­vel­oped coun­tries.

There are par­al­lels with the events of 25 years ago, when Bri­tain crashed out of the ex­change rate mech­a­nism on Black Wed­nes­day. The ill-fated ex­per­i­ment lasted only two years and re­sulted in a scram­ble to fill the pol­icy vac­uum. Fill­ing the cur­rent vac­uum is not go­ing to be easy be­cause the fi­nan­cial cri­sis and Brexit have shat­tered the as­sump­tions on which UK eco­nomic man­age­ment was based: that free mar­kets al­ways de­liver, and that Bri­tain’s fu­ture was as part of the EU. Both left and right face the chal­lenge of how to fill the void.

Labour’s re­sponse to Black Wed­nes­day was to move to the right un­der Tony Blair, sym­bol­i­cally ditch­ing na­tion­al­i­sa­tion and ac­cept­ing the dis­ci­plines of the global mar­ket. Cor­byn has moved to the left, con­fi­dent that this is a once-in-a-gen­er­a­tion mo­ment when the coun­try is ready for rad­i­cal ideas. The Tories, judg­ing by the way they are be­hav­ing, think he is on to some­thing.

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