ADRIAN OLDFIELD THE INDEPENDENT LABOUR PARTY AND PLANNING, 1920-26 The failure of the ILP to convince a Labour opposition, and then a Labour government after 1929, to abandon its view that banking and politics were quite separate fields of activity is well-known. Politicians were not bankers: it was as simple as that. Ramsay MacDonald, though not averse to political programmes as such, was certainly suspicious of "unauthorised" programmes. In a veiled but unmistakable reference to ILP policy statements, he told the 1927 Labour Party conference that "authorised programmes might have a certain number of in- conveniences, but unauthorised programmes had many more inconveniences, and he was not at all sure that during the last twelve months or two years the Labour Party had not suffered more from unauthorised programmes and statements than it had suffered from the issue of well-considered and well-thought-out documents and pronouncements."1 Philip Snowden was much more explicit. Unlike Sir Montagu Norman, Governor of the Bank of England,2 Snowden did recognise a causal relationship between changes in the availability of credit and changes in the levels of production and employment, but thought that this was a relationship which politicians should not interfere with. Control of credit held within it the possibility of inflation. "It might be highly dangerous", Snowden warned the 1928 Labour Party conference, "in the hands of a Government that wanted to use this means in order to serve some purpose, or to gain popular support." One might achieve temporary benefits, such as the reduction of unemployment from one 1 Labour Party, Conference Report 1927, p. 182. 8 For Norman's views see S. Pollard, The Development of the British Economy, 1914-1950 (London, 1967), p. 220; R. Skidelsky, Politicians and the Slump (London, 1967), pp. 13-14; and D. Winch, Economics and Policy (London, 1969), pp. 89-90. Downloaded from https://www.cambridge.org/core. IP address: 170.106.33.14, on 02 Oct 2021 at 18:21:08, subject to the Cambridge Core terms of use, available at https://www.cambridge.org/core/terms. https://doi.org/10.1017/S0020859000005113 2 ADRIAN OLDFIELD and a quarter million to a quarter of a million in nine months, but there would be a terrible price to pay later - all the more terrible because unspecified.1 What perhaps is less well-known than this refusal of the Labour Party leadership to be persuaded of the desirability of the ILP's Living Wage policy, is the content of the policy itself, and in particular the fact that at its core was advocated a system of national economic planning. This essay seeks to elucidate the development of the Living Wage policy in this respect. Towards the close of the First World War, and indeed during the two years that followed its end, the ILP had been unwilling "to prepare elaborate schemes of reconstruction" because "of the unsettled state of industry and of finance and economics".2 Beginning in 1920 the doctrine of the ILP was to develop in two increasingly converging directions, each of which was to lead to a concept of planning. First, from the point of view of ultimate demands, the appropriate forms of public control of industry were discussed, in which the approach was, at least initially, a modification of the guild-socialist position which had been much publicised during the previous decade. Secondly, from the point of view of immediate purposes, proposals were developed to lift the depression through a process of redistribution of incomes - workers could be paid a "living wage" immediately, without waiting until the whole, or a major part, of industry was socialised. Each approach varied in detail, but both eventually stressed the need for deliberate planning of economic and industrial activity, in which a crucial role would be allotted to the public control of investment and credit. I THE SOCIALISATION OF INDUSTRY The ILP did not possess, at the end of the First World War, any document similar to the Labour Party's Labour and the New Social Order? The war was not, however, without effect on the party. In the first place, it provided a political home for many who could not forgive the Liberal Party, not only for taking Britain into the war, but for using certain measures to fight it, especially conscription, and also for pressing unconditional surrender upon Germany rather than 1 Labour Party, Conference Report 1928, p. 231; Winch, op. cit., p. 93, in- correctly attributes this speech to the 1929 Labour Party conference. 2 ILP, Conference Report 1918, p. 32. 3 See A. Oldfield, "The Labour Party and Planning - 1934 or 1918?", in: Bulletin of the Society for the Study of Labour History, No 25 (1972). Downloaded from https://www.cambridge.org/core. IP address: 170.106.33.14, on 02 Oct 2021 at 18:21:08, subject to the Cambridge Core terms of use, available at https://www.cambridge.org/core/terms. https://doi.org/10.1017/S0020859000005113 THE INDEPENDENT LABOUR PARTY AND PLANNING 3 seeking a negotiated peace.1 Their entry into the ILP, as well as the war experiences of those who were already members, did much to turn the attention of the party towards foreign affairs, both its aims and its methods of conduct, which had hitherto been somewhat neglected. Of those, however, who were to be prominent in shaping the ILP's domestic policy in the 1920's - Clifford Allen, Fenner Brockway, Fred Jowett, H. N. Brailsford, Frank Wise, and J. A. Hobson - all except Hobson were pre-war members of the party. This is not to suggest that they carried with them, unchanged from pre-war days, policies which became the ILP's after the war. On the contrary, the war had a profound effect on their thinking. The protest they made, especially in the No-Conscription Fellowship, founded by Brockway and largely run by Allen, was a response to the "autocracy of the centralised state".2 The sense of powerlessness in the face of an un- challengeable state is well illustrated by the interrogation of Allen by the tribunal which heard his appeal against service on conscientious grounds, during which he regretted that the mere business of living — smoking, eating, travelling - assisted the government's war effort by providing it with revenue.3 This was fertile ground in which ideas of guild socialism could grow. Clifford Allen's own conversion on this score would have been of less account had not many in the ILP thought likewise: 805 of the 1091 conscientious objectors tried were members of the ILP.4 The ILP itself, thus, was prepared for doctrines, like those of guild socialism, which would minimise the competence and power of the central authority of the state. Allen's association with G. D. H. Cole went back to pre-war days, when they were both involved in efforts to shake up the Fabian Society, but at this time Cole was not calling himself a guild socialist.5 From December 1914 on Allen was preoccupied with running the No-Conscription Fellowship, and from mid-1916 on he was in and out of prison for objecting to any kind of service which would assist the war. His ill-health meant that imprisonment was followed by periods, all too brief, of convalescence, during the last of which he spent much time reading the literature of guild socialism,6 which by this time was fully fledged. 1 See R. E. Dowse, Left in the Centre (London, 1966), ch. 2; and Marvin Swartz, The Union of Democratic Control in British Politics during the First World War (Oxford, 1971). 8 Dowse, op. cit., p. 27. » See A. Marwick, Clifford Allen (Edinburgh, 1964), p. 30. 4 Dowse, ibid. 1 Margaret Cole, The Life of G. D. H. Cole (London, 1971), p. 74. 6 Marwick, op. cit., pp. 46-48. Downloaded from https://www.cambridge.org/core. IP address: 170.106.33.14, on 02 Oct 2021 at 18:21:08, subject to the Cambridge Core terms of use, available at https://www.cambridge.org/core/terms. https://doi.org/10.1017/S0020859000005113 4 ADRIAN OLDFIELD Allen responded enthusiastically to this literature. In January 1918 he commented: "The more I read and think about this new way of getting all the good things of socialism with a minimum of interference by a bureaucratic state, the keener I become about it."1 Early in 1919 he joined the executive of the National Guilds League,2 and became convinced that the ILP must recover its pre-war role of "pioneering Socialist thought and action"3 within the labour movement by adopting a programme which distinguished it from the Labour Party, and was more advanced than Labour and the New Social Order - otherwise the party would become redundant. His view, naturally enough, was that the ILP should adopt a guild-socialist programme. The 1920 conference of the party saw the passage of a motion calling for "an effective political and industrial organisation of the workers, whether by hand or by brain", which clearly differentiated between "the Capitalist collectivism implied in the nationalisation of essential services, controlled by a bureaucratic Central Govern- ment, and the social control in the interests of the whole com- munity, implied by joint control by representatives of the general community and the workers in particular industries".4 Allen evidently had much support for his position, and he was in- strumental in securing the setting up of a committee to consider, among other matters, "what fresh proposals require to be formulated in the Program of the Party".5 The committee's discussions and conclusions were reported to the 1921 conference of the party.