1 INTRODUCTION the United Kingdom Is a Constitutional

INTRODUCTION

The United Kingdom is a constitutional monarchy. The country is governed by the government which is responsible to Parliament. In liberal democracies a representative government can only be facilitated by political parties. The Labour Party is one of the two major parties strong enough to win a general election and form a government.

Throughout its history, the Labour Party has undergone numerous policy changes. It came to Parliament in 1900 with only two MPs elected. It represented the working people and stood firmly on the left of the British political spectrum. Now the Labour Party has a majority in Parliament with a total of 356 seats. It has become a “catch-all” party which has decisively cast aside all class-related appeals. The present leader, Tony Blair, has stated clearly that

“Labour is the political arm of none other than the British people as a whole” (Dunleavy, 4).

The party claims to be a centre-left party, while the critics place it in the centre or even on the right.

My thesis takes a close look at how the Labour Party has developed ideologically over time. While following the development of thoughts in the Labour Party I present and comment on the ideas expressed by all those who ideologically influenced the evolution of the

Labour Party. The ideas have come from different levels of the party that can be divided into

Labour in Parliament and Labour outside Parliament. The former comprises the leadership, ministers and MPs who are members of the Parliamentary Labour Party (PLP). The latter is made up of party members organized in Constituency Labour Parties, affiliated trade unions and socialist societies. Labour in Parliament have mostly constituted the party’s right, whereas Labour outside Parliament the party’s left. My thesis focuses on the ideological struggle between the party’s right and left from its beginnings up to the present.

THE INDUSTRIAL REVOLUTION AND THE WORKING CLASS

The movement of the British labourers had always been a movement of social protest.

It had a long and distinguished tradition. In 1381 John Ball died on the gallows at the end of the Peasants’ Revolt that was directed against the injustice inflicted by the arbitrary poll tax.

The agrarian socialists of medieval times found their successors in the movements of the

Diggers and the Levellers. The former preached primitive communism, while the latter focused on both the actual standards of living of the lower classes and their political position.

th In the 19 century a movement of social and political reform was represented by the Chartists whose political views now seem so reasonable, but were refused at that time. All these movements put forward ideas that challenged, though not changed, the established system in which economic and social privilege was enjoyed by the few.

The system was also challenged from the top by some enlightened thinkers. Robert

Owen’s mills at New Lanark were an example of a possible combination of the profit for the owner and the social welfare for employees. Nevertheless, New Lanark was one of the few places where the working people were treated fairly. Mostly, the Industrial Revolution brought benefits to the chosen few, whilst ignoring the ruled. The Industrial Revolution,

th th which occurred in Britain in the 18 and 19 centuries, fundamentally altered the shape of

Britain. So great was the impact of the Industrial Revolution that it cannot possibly be ignored when following the development of the socialist movement in Britain that culminated in forming a party of the British labourers.

th The Industrial Revolution had its origins in the middle of the 18 century when a great transformation took place in the economic life of Britain due to the invention of new machines and processes. The changes disrupted settled patterns of society which, although remaining by far agricultural, underwent a great change “in the relative importance of industry and agriculture, of town life and country life” (Rodgers, 15). The Industrial

Revolution brought with itself great prosperity and confirmed the country’s dominance in the world.

th In the course of the 19 century Britain had evolved to the stage of industrial and imperial superpower with society that became highly stratified and in which prosperity was far from being distributed equally. The Industrial Revolution gave birth to the class of workers. The working class found itself oppressed by the ruling classes. The working class enjoyed the living and working conditions that were in sharp contrast to what one would have expected of the “civilized” world. Typical features of the life in some parts of London, the richest city in the world, were “casual and seasonal unemployment, starvation wages, overcrowding at exploitative rents [and] an inhumane system of poor relief …” (Walkowitz,

193). The undesirable environment and a highly hierarchized society, in which moving up the social ladder was hardly feasible, made it impossible for the working class to enjoy the fruits of economic prosperity or even to lead a decent life. One of the most influential social thinkers, Sidney Webb, set out to rouse the conscience of Londoners in the following way:

Twenty thousand of its [London’s] citizens fight in the fearful daily struggle for bread at the dock gates…thirty thousand of its children are at school entirely breakfastless. One of every five of the five millions who began again today the weary round of life will eventually quit that life in the workhouse or the hospital…And all this in the richest and most productive city in the world. (Rodgers, 41)

On the other hand the British working class was – when compared for example with their French counterparts – relatively well off, especially in the period after the Great

Exhibition. The affluence of the country “rubbed off on all classes” (Rodgers, 9), with the working class getting the least share. In addition to the improvement in everyone’s standard of living, the country had developed democracy to the extent other countries could only dream of. Moreover, protestant religions were keen on helping the working ethic and obedience high and there also was the royal family represented by a virtuous couple which was looked up to.

Victoria and Albert epitomized strength, pride and unity of the nation and the Victorian society is said to have been of high moral attributes, virtuous and relatively stable (Bell).

The improved living conditions, the presence of democratic means, the protestant work ethic and the royal couple as an example of virtuous life played their roles in the country’s avoiding a revolution as experienced in France. In the British context the question was not to overthrow the system, but to find a better place for the working class in it.

Supporters of the socialist movement were aware of Britain’s democracy and traditions and did not want to get beyond them. Thus the important aspects of the socialist movement were its peaceful and democratic nature, though some militant actions in the North could not be averted. A belief in democracy as the means of socialism and a refusal of too revolutionary

Marxist measures were aptly grasped in Fabian Essays. It says that important changes in society could only be:

(1) democratic and thus acceptable to a majority of the people…; (2) gradual, and thus causing no dislocation, however rapid may be the rate of progress; (3) not regarded as immoral by the mass of the people…;and (4) in this country, at any rate, constitutional and peaceful. (Webb, I.1.8)

Before the socialist movement could have an impact on society, favourable conditions for perception of socialist ideas had to be created. In this respect the Industrial Revolution was of great and lasting importance. The negative effects of the Industrial Revolution that manifested themselves in the poor conditions of the working class opened up a platform upon which socialism and the representation of the working class could be discussed. According to

Rodgers the Industrial Revolution “was decisive in creating the conditions for socialism” (15).

So it is in the uneven distribution of prosperity and in the changes in society caused by the

Industrial Revolution where one can find inspirations and origins of the demand for a government by and in the interests of the working people. But how to advance reforms?

Through the established political parties or through a new party?

THE WORKING CLASS AND OTHER POLITICAL PARTIES

th There was a stable political environment in Britain of the 19 century, with the established two party system. Neither the Liberal Party nor the Conservative Party (the latter to a lesser extent) was historically too hostile to the working class. The three passed Reform

Bills and several factory acts brought some political and working benefits to the working class. However, neither of the mentioned parties was willing to directly appeal to the working class and form their policy exclusively on the needs of the working class.

It is arguable whether a possible representation of the working class could have been effected by the Liberals, the idea of which came to be considered more seriously after the

Liberals adopted a new programme of reforms at Newcastle in 1891 trying to win some votes from the working class (Rodgers, 39). The Liberals, however, did not prove to predict events very well. They underestimated the influence of the emerging Labour Party. Both on the local and national level, the Liberals were not willing to share power with Labour: “…no great effort was made to bring Labour men into the inner circle of power” (Beer, 148-149). By not assimilating the Labour representatives into their ranks, the Liberals helped create a room for a new party.

The Liberal Party did not only adopt a sufficient number of its own working class candidates in the country, but it also agreed to the electoral pact in 1903 with the Labour

Party. The pact was a shrewd step of Labour’s leaders, but proved to be of little benefit to the

Liberal Party. Though the Liberals won the 1906 election, they helped the Labour Party to get into the saddle (Rodgers, 50-56). In the long run the Labour Party has taken the position of the

Liberal Party in the two party system in Britain.

The other party, the Conservative Party, pursued the policy that could not possibly be regarded as pro-working class, though some reforms that raised standards of living and social legislation were carried out by them. Their biggest blunder was committed when they refused

to legislate a reversal to the Taff Vale decision. In this case the judgement was given in favour of a company with trade unions having to pay damages and costs caused by the strike. If the

Conservative government had issued the legislation to reverse the Taff Vale decision there could have been a fair chance of winning the working class vote and thus curbing the Labour

Party. The short-sightedness of the Conservatives cemented the Labour case.

The reluctance and unwillingness of both the Conservatives and the Liberals to appeal to the working class contributed to the awakening of trade unions. They began to view the representation of the working class on Parliamentary ground as a necessary vehicle of reforms, which had not always been the case. Trade unions joined the Labour movement in its desire to form a distinct party in Parliament. The failures of the Liberals and Conservatives and the mobilized trade unions alongside with various socialist groupings paved the way for a new party.

FRAGMENTATION OF THE LABOUR MOVEMENTAND KEIR HARDIE

th Towards the end of the 19 century there were a few socialist groupings and trade unions that came to be associated with the origin of the Labour Party. Their ideas may well have shared a common ground, but their efforts were not much coordinated with the result being a vague policy. This was a clear danger as a diluted policy confused the people, who started asking questions. Who was to represent our interests best? The intellectuals from the

Fabian society? Or more practical men from Social Democratic Federation (SDF)? Or trade unions transformed into a political party?

The situation was made more complicated by that fact that a possible favourite of the people, trade unions, showed signs of exclusivity unfavourable to unskilled workers. Trade unions organized and provided help just to skilled workers. Those who badly needed help were overlooked. A change was needed to win the support of the people. This came with the emergence of the “new unionism” that was far more militant that the “old unionists”, but on the other hand, open “to all those willing to join” (Rodgers, 32).

The socialist movement was too fragmented to appeal coherently to its potential supporters. A number of socialist groupings and trade unions shared the goal, but differed in means. Such a fragmented movement desperately needed someone who could bring its various strands under one roof. The Labour movement was lucky to have Keir Hardie.

Keir Hardie was one of the initiators of the conference in 1893 with the aim to form the Independent Labour Party (ILP), the forerunner of the Labour Party. The goal of forming a distinct Parliamentary party was reaffirmed there. The influential socialist groups that attended the convention included the SDF, the Fabian Society, the Scottish Labour Party and trade unions. They came to the conclusion that effort would be made to provide “the organization for winning Parliamentary representation for the working man” (Rodgers, 38). In

order to best represent the working class a completely new party with a genuine party structure, policy and leadership was required.

THE EMERGENCE OF THE PARTY’S LEFT AND RIGHT

The Labour Party came officially into being at the conference that was held in the

Memorial Hall, Farringdon Street, London on February 27-28, 1900. There met the delegates representing the Fabian Society, the SDF, the ILP and trade unions. The conference proposed that there should be “a distinct Labour Group in parliament, who should have… their policy, which must…be engaged in promoting legislation in the direct interest of labour, and be equally ready…in opposing measures having an opposing tendency” (Rodgers, 47).

The conference created an association called the Labour Representation Committee

(LRC), whose task was to act as a body coordinating and supporting candidates to Parliament who would be sponsored by trade unions and naturally represent the working class population. It had no single leader. The candidate for a secretary post, Ramsay MacDonald, was elected. Six years later the annual conference of the LRC adopted the name “The Labour

Party” and Keir Hardie became leader (The Labour Party).

Working within the established framework, ever growing socialist propaganda provided by various papers and sympathizers, peaceful and democratic proclamations and the unwillingness of the Liberals and the Conservatives to see to the needs of the working people were the factors that contributed to the Labour movement winning popular support with the result being the newly born Labour Party.

Once the Labour Party came into existence its policy had to be formulated in order to attract voters. The first party manifesto was not a last minute work. The socialist alliances, mainly the Fabian Society, the left-wing press, such as the Clarion , and other thinkers had been active in promoting socialist ideas well before the Labour Party officially started to exist.

They provided the social movement with a vital set of beliefs. The first election in which the

Labour Party took part, then still called the LRC, was held in 1900 and the party came up with the manifesto calling for “measures …to enable the people ultimately to obtain the

Socialisation of the Means of Production, Distribution, and Exchange, to be controlled by a

Democratic State in the interests of the entire Community, and the Complete Emancipation of labour from the Domination of Capitalism and Landlordism” (Labour manifesto 1900).

The 1900 manifesto reflected the stark divisions in society. Although the Labour Party was careful to avoid phrases like “class-war”, their manifesto did imply for whom and against whom they would fight. It set out to take socialist measures in the name of the people and it also laid emphasis on gradual taxation and economic equality.

There had been some ideological disagreements in the Labour movement well before the first official policy of the Labour Party was formulated. Nevertheless, it was only after the birth of the Labour Party when one could speak of the party’s left and right.

The right was represented by the leadership, trade unions and later on Labour in

Parliament (or the Labour Parliamentary Party – PLP). The left drew its support mainly from socialist societies, such as the SDF, operating outside Parliament. Both the factions favoured socialist measures to improve the position of the working class. They cooperated fairly well as they were aware of the fact that a united policy could attract more supporters. Hence one could hardly speak of too sharp ideological disagreements.

Nonetheless, even at the time of a relative ideological consensus in the party one could observe different accentuation of the suggested socialist measures. The left tended to put forward the ideas associated with Marxism. Its main claim was a necessity of class war that has, however, never entered the official Labour policy. The SDF claimed that there could be no united party without unity of principle, so they called for the nationalization of the means of production, distribution and exchange (Rodgers, 49).

At the other extreme there were trade unions that were traditionally seen as non- socialist. The cautious approach of trade unions was understandable when one takes into account the broad coalition of workers they sought to represent. Some workers were reluctant

to associate themselves with the working class. Instead, they tended to see themselves as a lower middle class. For example, the representatives of the Shipwrights wanted not to bind potential MPs by any working class ideology. Trade unions could not possibly ignore the better-offs and therefore their policy was moderate (Rodgers, 48-56).

The right refused radical proposals such as class war. It was more able to capture the fundamental nature of British society and political scene. It showed a higher level of practicality and was more able to project its ideas into the Labour policy.

The proposals from both the left and the right were harmonized before they entered the official policy. This process was facilitated by Keir Hardie. The rejection of the radical ideas proposed by SDF was not only a vital, but also a prophetic step. It broadened the Labour electorate as some of the upper working and lower middle class voters could join Labour.

Hardie and other leaders were the key players in keeping the Labour movement unadventurous and, as such, long-lasting. The party was unique in welding socialism to the self-interest of labour force organized by trade unions. All in all, before its foundation as well as after the Labour Party was not an avowedly socialist party.

In-party disputes accompanied and influenced the development of thoughts in the

Labour Party from its origins and contributed to the organic and democratic nature of the party organization that came to embrace pragmatic, rather than radical, policies in its effort to represent the working people. The final policy was a result of the intra-party debates with the right-wing being in a modest ascendancy over the more radical (and therefore described as more socialist) left-wing. The ideological divisions between the left and the right deepened after the Labour Party had made it into Parliament.

IN PARLIAMENT

The ideological tensions in the Labour Party became more serious when the Labour

Party managed to enter Parliament. There were two Labour MPs in 1900, twenty nine in 1906 and forty two in 1910 (UK General Elections). These Labour MPs were pioneers who had to teach themselves how to handle the Parliamentary machinery first. They felt pressure exerted on them by some impatient supporters outside Parliament who could not swallow the fact that one had to make some policy concessions. Labour was becoming divided between “practical men” in Parliament and trade unions on the one side and “visionaries” that operated mainly in the structures of various socialist groupings on the other side. The former could be said to have represented Labour’s right, while the latter came to be viewed as Labour’s left.

On entering Parliament, the Labour Party had to face problems previously unknown.

Their MPs might have come to Parliament with “real” socialist ideas, but the reality of necessary Parliamentary cooperation made them soften them. At the beginning of the party’s

Parliamentary career Labour Mps were in a position of apprentices who looked mainly to the

Liberal Party for cooperation and help. In order to play a part in the Liberal reforms, such as the Old Age Pension, compromises had to be made and Keir Hardie stated clearly that Labour was in favour of “constructive statesmanship” (Rodgers, 60-61).

The right in Parliament found its supporters in the trade union movement, though of course not in all of its parts. Trade unions attacked the influential socialist societies, such as the SDF and the Fabian society. The Insurance Bill, presented by Lloyd George in 1911, sparked a sharp disagreement between trade unions and socialist societies. While trade unions were willing to accept the proposal, which imposed the liability of the contributory system upon them, the societies opposed the Bill. The organized cotton workers went as far as to demand the exclusion of the socialist societies from the party executive (Rodgers, 63).

The pragmatic stand of most of the Labour MPs failed to find recognition on the left which accused the PLP of being too little militant. Being a practical party was something the

“visionaries” could not swallow. They were somehow not willing to grant much time to their

Mps and were eager to see changes done and taken effect immediately. They took little notice of the Labour Party being still very young and inexperienced. “Socialism without dilution”

(Rodgers, 60) was the motto of those believing propaganda and immediate implementation of socialist measures more important than Parliamentary work.

The dispute over the Insurance Bill was the greatest of few others. Another problem paralyzing the party was the lack of technical cooperation between its Parliamentary and non-

Parliamentary branches. Beatrice Webb noted that there was “the absence of any relations, good or bad, between Labour MPs and the Labour movement in the country” (Rodgers, 62).

The communication within the party was underestimated by the right, which inevitably intensified opinion differences between the left and the right.

The ideological disagreements and the unsatisfactory level of communication resulted in creating the British Socialist Party where dissidents from the societies found their resort.

The dissidents were disillusioned by the Parliamentary tactics of Labour MPs and by non- revolutionary nature of trade unionism in Britain. They called themselves “Syndicalists” and saw a general strike as a tool to be used to achieve “the economic emancipation of the workers” (Rodgers, 64) and to win class war. Beatrice Webb was aware of a dangerous potential of Syndicalism that she compared to radical Marxism: “Syndicalism has taken the place of the old fashioned Marxism” (Rodgers, 64). The party once refused class war and radical Marxism. Now there was the same challenge, though under a different label, that

“showed a widespread and potentially dangerous discontent with existing social and political organization” (Rodgers, 64). Labour’s stance was firm. Even the most leftist branches of the

affiliated societies preferred the alliance to non-socialist trade unions to doctrinaire Marxism and the unproductive agitation of revolutionary socialists (Rodgers, 69-70).

Over the first days in Parliament the Labour Party was an uneasy coalition of trade unions, Labour in Parliament and affiliated socialist societies in which only one thing was clear: All of them desired to see the working people represented in Parliament. After this was achieved the way in which to represent the people differed sharply. The left advocated a more radical approach, while the right preferred a step-by-step approach. In the light of some revolutionary tendencies it was highly important for the Labour Party to maintain its non- revolutionary characteristic and remain a pragmatic Parliamentary player. In the Labour Party there was being established a firm body of socialist ideas characterized by a constructive, peaceful and democratic approach.

THE LABOUR PARTY AND WORLD WAR I

By 1914 the greatest imperial powers had divided the world among themselves to the extent that another redistribution could only be achieved through an international conflict. The

Great War interrupted a natural development of the Labour movement. Intellectual clashes over the social end economic policy were replaced by the reality of the day. The Labour Party had to put the case for the imminent war conflict. The Labour movement had always been peaceful and the Labour Party did not get out of this trajectory. A national campaign against war, and generally against militarism, constituted the bulk of Labour’s policy before WWI.

The Labour Party exemplified a unity to the extent unknown before. Competing factions in the party managed to form a united policy. This was because ideology questions were overshadowed by the war conflict. The party was united in its efforts before, as well as after the outbreak of WWI when the party’s position had to be changed twice. The first change was caused by the fact that pacifist efforts proved not to be working. The second change of opinion was a reaction to the unexpected length of the war.

Despite the fact that the Labour Party was consistent in its anti-war proclamations before WWI, it failed to come up with a real alternative that would help ease international tensions. Keir Hardie’s attempt to unite European workers did not bring any results. This futile endeavour could not stop the war. The fact that the right suggested the international strike, which it had always repudiated, testified to a certain influence of the left. It is, however, important not to exaggerate the importance of the left as it was mainly a unique international situation, rather than the weight of the left, that caused the right to suggest the strike as a means to prevent the outbreak of hostilities (Rodgers, 72).

The belief in international pacifism failed and Labour had to modify its attitude. Now it proposed an industrial truce in the interests of the war effort and gave its support to the army recruiting campaign (Rodgers, 72-73). Both the left and the right were convinced of the

necessity to end the war as speedily as possible. They saw the war as a reaction, not as a means to conquer other territories.

The war lasted longer than everyone had hoped. The horrors of the Somme, where

60,000 Britons lost their lives in a day without a prospect of victory, intensified the feeling of weariness. The horrendous outcome of the battle made the Labour Party alter its attitude once again. The general view was that the working people were carrying more than their fair burden was. As a result, Labour opposed the introduction of compulsory conscription

(Rodgers, 76-77).

The changes of the party policy initiated by the leadership responded to the war developments and were generally welcomed both by trade unions and affiliated societies. In this respect one can speak of a general consensus in the Labour Party. Even the most opposing streams of opinions in the party, represented by trade unions and the ILP, moved to a closer cooperation and placed their common goals before personal animosities and ideological disagreements.

The Labour Party acted as a united body though it had to withstand the pressure coming from the far left and the far right. On the left a large section of the ILP and a majority of the British Socialist Party, which was finally accepted into the Labour Party in 1916

(British Socialist Party), remained attached to the peaceful internationalism of workers throughout the whole war. At the other extreme, some Labour spokesmen, such as Blatchford and Hyndman, were extremely nationalistic and hostile to Germany (Rodgers, 74).

Fortunately, the Labour Party was strong enough to stand up to both the left and right extremism.

Overall, the party managed to pursue a united policy throughout the war, whilst at the same time leaving enough room for the constructive in-party discussions in which both the left and the right took part. The party was characterized by a loose federal structure and by the

absence of a central dogma. The leaders “did not attempt to discipline or expel the minority”

(Rodgers, 75), while being able to present a balanced policy agreed on by the majority of the left and right. The party had been democratic since its beginnings and the war period saw no changes in this respect.

THE RIGHT HALTS THE LEFT

The war made the whole political scene more socialistic, which was also true of the

Labour Party. The country’s dependence on the common people in the time of emergency gave the Labour Party confidence necessary to propose a more socialist policy. Labour became a more relevant party for the workers who suffered most in the wake of economic recession that came soon after the short post-war boom. The working class was becoming to perceive the Labour Party more seriously than before as it was believed the most capable of delivering a remedy of workers’ plight. The party as a whole was taking on socialist characteristics. A complete switch to real socialism was, however, stopped by the party’s right.

Labour’s left called for a new social order that would not be based on inequality. This was to be achieved by planned economy, maintenance of full employment and provision of welfare and social security (Rodgers, 80).

In view of weakened opposition to socialism after the war, a more socialist policy of

Labour’s left had become viewed more seriously. This was something unthinkable before the war when mainly trade unions were hostile to the socialist doctrine. Now after the war the left formulated its policy which entered Labour’s domestic programme. The keystone of the policy was the famous Clause IV, drafted by Sidney Webb, which set out:

to secure for the workers by hand or by brain the full fruits of their industry and the most equitable distribution thereof that may be possible upon the basis of the common ownership of the means of production, distribution and exchange, and the best obtainable system of popular administration and control of each industry or service.(ClauseIV)

Clause IV was accepted by the left as well as right. Nevertheless, Labour’s overall swing to the left was checked by the leadership. In 1922 Ramsay MacDonald was elected leader after being nominated by the militant left-wing group, the Clydesiders, and the ILP.

These left-wing societies hoped for a real socialist Britain, assuming that the leader was a

natural left-winger. This assumption was not unjustly based on MacDonald’s wartime record.

Yet, after the war the new leader proved to be a practical man who used the left-wing terminology, but was far from implementing it. Instead of heading towards a socialist Britain, no attempt was made to enact any of the socialist measures suggested by the left and incorporated in Labour’s domestic programme (Rodgers, 92).

It had become a tradition that the leaders of the Labour Party were representing the party’s right. MacDonald was not an exception. Some affiliated societies hoped for a socialist revolution for which there was now a more suitable environment created by a more favourable appreciation of socialism in the wake of WWI. MacDonald, however, “wanted to develop a kind of socialism that would fit the situation in Britain” (McDowall, 161). He did not allow the Labour Party to change into a thoroughly socialist party. The party’s programmatic shift to the left after the war was evened up by the pragmatic approach of the leader a few years later.

WORKERS’ SOLIDARITY AND DIRECT ACTION

In 1924 the Labour Party was able to form the first, though minority, Labour

Government. As it was in a minority it only lasted 10 months and another election was held in

1924. This time Labour was defeated, though it raised its popular vote (General Election

1924). Labour lost power, yet not confidence and prestige. However, there was a challenge to come to test the viability of the whole Labour movement.

The General Strike of 1926 was the first event to witness a victory of more revolutionary tendencies in the Labour movement. The unsuccessful strike exposed the impracticability of reforms done outside the traditional framework. On the other hand the strike also confirmed the high potential of the working people to cooperate. The Labour Party had two lessons to learn from the General Strike: first, it learnt that the more radical the movement was getting, the less likely it became to achieve socialist aims. Second, the party could notice a high level of solidarity among the working class during the General Strike, which gave Labour more confidence to appeal to its electorate.

The working people were hit hardest by the combination of high unemployment and the unlucky decision of Winston Churchill who announced a return to the Gold Standard at the pre-war parity with dollar. This meant overvaluing the pound by 10 per cent (Mitchinson).

The bosses of industry had to find a way to compensate for this overvaluation by cutting costs. They faced a “hard” decision of either shortening their profits or cutting workers’ wages. Predictably, they chose the latter, which had a great impact on the working people who needed to defend themselves.

The General Strike saw a shift of opinion to the left in the trade union movement. This was surprising as trade unions had been, alongside with the leadership and the Parliamentary

Party, the representative of the moderate part of the Labour Party. The key to new militancy in the unions was the work of the National Minority Movement. This rank and file body had

taken off in 1924 and set its task “to convert the revolutionary minority within each industry into a revolutionary majority” (Mitchinson). This proved a highly successful strategy with the result being a fairly high support of the movement, mainly among miners. There was a belief that society could be revolutionized by industrial warfare. Owing to the cuts in wages, revolutionary ideas were easy to find support among the discontent working people.

In the light of the unfavourable working conditions it is perhaps not so difficult to understand why trade unions became supportive of strike efforts though this attitude was in sharp contrast to what had been proclaimed as a goal of the Labour movement before. It had always profiled as a peaceful and democratic movement believing in Parliamentary actions as a vehicle for change. In the General Strike the British trade union movement forgot its more cautious instincts and lost the battle.

On the other hand the General Strike showed an unceasing potential of the Labour movement. The miners received immense support from other workers: “Of 30,000 train crews…only 400 reported to work on the first day of the strike. That day not a single bus moved in London, no cargoes were unloaded in London docks…” (Rodgers, 98).

Nevertheless, the uncompromising government in power did not allow the solidarity of the working class to celebrate a victory.

The General Strike did not improve living standards of the working class. Still it provided a very good lesson to the Labour Party. Its adherents fully realized that direct actions could not be triumphant unless there was a revolution. And there was not a prospect of a revolution in Britain before as well as after 1926. British society was well receptive of social ideas, but only of those nurtured by pragmatic and democratic motives and enacted on

Parliamentary ground. In other words the Labour Party could not afford to be too radical or too socialist if it wanted to represent the working people to their benefits.

MACDONALD’S TREACHERY

The 1928 Representation of the People Act widened suffrage by setting women on equal footing with men. Taking into account the fact that in the total electorate young women now outnumbered men by one and a half million (Rodgers, 103), the Labour Party could have grounds for optimism as women were expected to increase Labour’s vote. The 1929 election results made Labour the largest party in Parliament for the first time in the history. However, the party had no time to celebrate since it had to deal with ideological clashes between its left and right wings.

The effect of the General Strike was damaging for the party’s left. The right demonstrated its strength by not including the representatives of the left into the new Labour government. To the disappointment of the left, the candidates suggested by the ILP, Wheatley and F.W. Jowett, were rejected (Rodgers, 106).

In addition to the objections concerning the posts in the government, the left could not agree with MacDonald’s indecisiveness to apply socialist remedies to the mounting unemployment after the catastrophic Wall Street crash. According to the left the only solution rested in wholesale nationalization. As one could expect, their proposals were turned down by

MacDonald (Rodgers, 109).

The right found its vigorous advocate in the person of Philip Snowden who served as the Chancellor of the Exchequer and who became the embodiment of the party’s right wing.

Snowden was firmly committed to the idea of financial orthodoxy. He set up a committee to find out about financial prospects of the country. To the astonishment of the left, he chose to ignore the fact that the Labour representatives in the committee refused to sign its outcome that was warmly recommended by the business representatives. Snowed followed the business advice and introduced cuts in social expenditures (Rodgers, 111-113). The price for financial orthodoxy was to be paid by lowering the living standards of those whose interests the Labour

Party was supposed to defend. Beatrice Webb gave a true picture of whom MacDonald trusted and with whom he made a coalition: “…from being a fervent apostle of utopian Socialism, thirty years of parliamentary life… have made him [Snowden] the upholder of the banker, the landed aristocrat and the Crown” (Rodgers, 116).

The left was disillusioned by the policy some right-wing representatives stood to defend. The ideas of both MacDonald and Snowden were not welcomed by the party’s right either. The two men chose to leave the Labour Party and established a new party, the National

Labour, which had little popular support. In 1931 election it won only 13 seats as opposed to

52 Labour seats. Though the Labour vote fell sharply (the loss was 225 seats), the number of

Labour’s followers expressed by popular vote remained high at 6,339,306 (General Election

1931).

The Labour Party, with the right-wing in the foreground, was keen on pursuing pragmatic policies that, however, needed to be perceived as defending the interests of the working people. The leader and his Chancellor of the Exchequer got out of this trajectory and left the party. Nevertheless, MacDonald’s and Snowden’s going away did not unsettle the party’s foundations. The Labour Party upheld its stabilized position in the political world of

Britain with ideological clashes being a typical and necessary feature of its development.

THE LABOUR PARTY AND WORLD WAR II

The events of World War II confirmed Labour’s capability to act united during times of emergency as experienced during WWI. However, the party had to stand several tests.

Before the war it had to deal with revolutionary Marxism practised by the ILP. Then it had to overcome the unrealistic and naive policy of Lansbury Christian pacifism. Not only did the

Labour Party manage to contain the in-party disputes, but it also found, after the successful participation in the War Cabinet, its new leaders, e.g. Attlee and Morrison, who were considered “confidently fit to share in government again” (Rodgers, 136).

Before the outbreak of WWII the economic depression was troubling the country. The

Labour Party could do little to fight the mounting unemployment as it had to stay, given the election result, in opposition. The exposed vulnerability of capitalism triggered a reaction mainly from the party’s left. The ILP expressed its disillusionment by advocating a strong push to the left. The ILP felt it necessary to disassociate Labour from the right-wing steps taken by MacDonald and Snowden although the two men had already left the party. A policy was suggested that called for “imminent downfall of capitalism and … for renewed class militancy and mass industrial action …to replace capitalism by the Socialist Commonwealth”

(Rodgers, 120). Given the non-radical and democratic nature of the Labour movement, the

ILP found few followers and finally disaffiliated from the Labour Party.

There were two opposing streams of opinions in the party during WWII: first, pacifist, represented by the new leader George Lansbury and second, more realistic, advocated by trade unions and the PLP.

With dictatorships slowly emerging abroad the Labour party’s platform became dominated by talks on party’s mindset to a possible war threat. As expected, the party’s attitude went along the lines of a common desire for the peaceful world. The leading figure in the pacifist movement became George Lansbury. He held a complete pacifist position

claiming that nothing could justify the use of force. Long did Labour believe that the war could be averted (Rodgers, 125-126).

Generally, Labour did wish to stop Hitler, but was somehow unable to stand up to the reality mainly thank to the idealistic vision of Lansbury. The change of attitude came with

Mussolini’s invasion to Africa and the Spanish Civil War. Trade unions were active in the effort of changing the party’s pacifism into a more realistic stand. They suggested that the country should resist Fascism by whatever means necessary, thus risking an involvement in the war (Rodgers, 126). This stand was endorsed by the PLP, now with Clement Attlee as leader, which spoke of the necessity to resist dictators. The party also approved of an adequate rearmament and the service vote (Rodgers, 131).

During the World War II the Labour Party managed to participate successfully in the

War Cabinet, which was one of the reasons for the electoral victory after the war. The party was ideologically united, though there were some disagreements over the nation’s involvement in the war conflict. Overall, the party demonstrated its pro-nation and constructive approach.

ATTLEE’S GOVERNMENT

The Labour Party came out victorious from WWII. This was because the participation in the coalition government was successful, which gave people feeling that Labour could be relied on. In addition to this, the war made it necessary for some typically left-wing measures to take place. Thus rationing gave same shares to all, central planning of economy was set up and a highly progressive taxation resulted in a redistribution of incomes to the poorer people.

All of these steps laid foundation to the welfare state after the war: “By 1945 Britain was already tooled up for what was to come after” (Rodgers, 138). The question was which party would have the pleasure to finish the job.

The Labour victory in 1945 took the whole political scene by surprise. Even Clement

Attlee later admitted that “he had privately expected the Tories to pull it off” (Rodgers, 142).

However many reasons were given to explain the Labour electoral victory, which resulted in the first Labour Government with a majority, one thing was clear: the people of Britain did not want to go back to the misery of the pre-war times associated with the Tories. On the contrary one can claim that “the forces went solidly left” (Rodgers, 142).

The Labour Party could enjoy a positive setting for implementation of the left-wing policies that would accord with people’s ideas of a fairer society. Attlee’s government introduced reforms leading to the welfare state that gave the people right to education, health and security (Rodgers, 153). Labour followed the motto of taking care of citizens “from the cradle to the grave”, which came to be viewed as typical of the party policy for the next three decades or so.

Overall, both Labour’s left and right were in favour of building the welfare state. Yet, some right-wing Labour ministers opposed the idea and decided to vote with the

Conservatives. The left also joined the Conservatives and voted against its own ranks, but in a

different case. Some representatives of the left found it impossible to agree with the American financial aid agreed on by the government and voiced their concerns.

Socialist policies had always had its opponents in the party. After the war these opponents were not so much heard because the whole political mood had shifted to the left and the socialist ideas previously held radical were now seen as moderate and desirable. Still, the right did not cease to be guided by its more cautious instincts. This was manifested in little enthusiasm showed right at the birth of the Beveridge Committee Report which was acknowledged as the initiator of the sweeping proposal for the social welfare. Some Labour ministers showed little sympathy towards a more socialist Britain and joined the

Conservatives in opposing the measures (Rodgers, 140-141). Labour in Parliament had traditionally been inclined to a moderate policy, the fact of which was confirmed in this voting. Despite the opposition, the advocates of the welfare state managed to win their case and the social schemes were absorbed into Labour’s programme.

The disagreement over the extent of the welfare state did not cause any major splits in the party. More discussions and contention was to be observed over the case of large loans from America that were needed to fuel the British economy. This time it was Labour’s left that joined the Conservatives in voting against its ranks. The left claimed that any financial obligations to capitalist America were out of question (Rodgers, 147). Lack of realism was at the roots of the left that was unable to endorse the loan. Post-war Britain desperately needed the loan that would help the recovery process. Labour’s left could not accept the fact that

Europe had been exhausted after the war and that the only possible creditor to ask for a loan was America.

The Labour Party was a stable political party in post-war Britain. It was best fitted to instigate social reforms to which the country became more sympathetic after WWII. The mainstream opinion in the party followed the general feeling that was now more open to left-

wing policies. Numerous ideological discussions did not divide the party. They testified to the in-party democracy in which a final policy was a result of a series of discussions. Those unhappy with the final outcome could voice their concerns which, however, did not always find reflection in the final policy.

Fortunately, neither the welfare state issues nor the American loan led to a too serious split in the Labour Party. Nevertheless, the relative unity of the party did not prevent its sudden decline from the great heights of 1945. Reluctance to adapt to changing economic and social realities was at the roots of Labour’s retreat from power in the 50s.

REVISIONISTS VERSUS FUNDAMENTALISTS

Six years after the war the Labour Party could be proud of its achievements. It restored the British economy, built the welfare state, established a fairer society and took to defend democracy abroad. Moreover, it managed to curb unemployment considerably. Compared with the unemployment figures from 1938, which showed that 13.5 per cent of the working population was out of job, the Attlee government reported only 1.2 per cent of the working population on the dole in 1951 (Rodgers, 161).

The problem of the Labour party at the beginning of the 50s was that it could not make use of the situation it had helped to life. Rising living standards gave people the opportunity to take part in the consumer revolution. Throughout the 50s they could afford to buy cars, homes, television sets and washing machines. A typical Labour voter was no longer the needy one. Now the traditional Labour voter lived in “a new house with a garage, his children earning good money or going on to higher education… ” (Rodgers, 161). In other words people hankered for a comfortable way of life that they were not able to lead before. To this prospect Labour seemed traditionally less fitted than the Conservatives. Labour’s austerity and central direction led the country out of misery, but now they appealed little to the society of individual affluence. Freedom to indulge in consumerism was valued more. Rodgers commented on the electors’ change of heart in the following way:”Under Labour they [the

British people] nobly minded and sown the seed corn. They now wished to relax a little and enjoy some of the harvest” (155-6). The harvest promised higher yields under the

Conservative leading. The Labour Party found itself in the crises of conscience as both its right and left wing were unable or unwilling to adapt their policies to new economic and social circumstances.

The election defeat revived ideological clashes in the party. The disagreements between the left and right did exist in the post-war Labour Party, but they did not develop

fully because in the main both the factions shared views on the Labour policy. However, the situation changed when the 1951 election was lost and Labour had to go to opposition.

Time in opposition is a period used for reconsidering the party’s policies. The left and the right had been accentuating a different kind of socialism ever since. There were times of a relative agreement as well as of strong ideological disputes. The two factions were competing with each other, each of them preferring a different course of action for Labour.

At the beginning of the 50s the factions were given various labels. Those on the right of the party were called practical men, reformists or revisionists as opposed to visionaries or fundamentalists on the left. Hugh Gaitskell became a representative of the revisionist group, while the left was led by Aneurin Bevan, the minister of Health. The intra-party struggles between the revisionists and fundamentalists over the nature of socialism accompanied the

Labour Party up to the disastrous defeat in 1979. In this context Eric Shaw speaks of Labour’s discourse that started at the end of 40s and ended at the end of the 70s (Shaw, 2).

On a general level, Labour’s discourse centred on a desirable degree of socialism as put forward by the left and by the right. Practically, the disputes were led over the problems of nationalization and unilateral disarmament.

The nationalization carried out in the post-war years was meant to give the state direct control over the economy. However, in spite of nationalizing coal, iron, steel, railways and airlines, only 20 per cent of British industry was actually nationalized and “these nationalized industries served private industry rather than directed it” (McDowall, 169). On the whole nationalization was a disappointment and it became unpopular even with settled Labour voters (Rodgers, 170).

In view of the failed privatization project, Labour’s leader Hugh Gaitskell proposed to modernize the party by taking a “non-Labour” look at the problem of public ownership.

Instead of seeing public ownership as the only way of achieving socialist ends, he suggested it

be just one of the ways of achieving them. He wanted to change the original version of Clause

IV, drafted in 1918 by Sidney Webb. Gaitskell’s attempt to revise the forty years old Clause

IV was met with strong resistance coming both from the party’s left and a substantial part of the party’s right (Rodgers, 172). His motivation was to make the party less doctrinaire and thus more attractive to the affluent Labour voter, but his choosing to attack Clause IV was unfortunate. This part of the Labour Constitution was still believed sacred. The time to its amendment had not come yet.

Gaitskell’s attacking Clause IV found its critics mainly among the ranks of the fundamentalists. Labour’s left found itself obliged to react in order to keep the party as socialist as possible. The fundamentalists saw public ownership, which Clause IV was believed to defend, as the only way to achieve socialist ends. It has already been mentioned that nationalization was not a great success. This, however, did not take off anything of the fundamentalists’ drive to make Britain socialist. Their opposition to Gaitskell included a reaffirmation of the old beliefs in public ownership (Beer, 223) that was perceived as the only way to real socialism.

One cannot escape a suspicion that the Labour’s left had become doctrinaire. There is nothing wrong with the party faction pushing through its policy on condition it does not become a dogma. In politics one has to be prepared to make compromises. But the fundamentalists were not wiling to retreat from its stand on public ownership. They left

Gaitskell with a difficult choice. He could either insist on a “non-Labour” approach to public ownership, which would have led to a destabilization of the party, or he could allow for a compromise. Gaitskell was a reformist and right-winger, but he was also a responsible leader.

Therefore he chose the latter alternative and “accepted proposals for further measures of public ownership principally because of the need to compromise…” (Beer, 222).

Gaitskell’s practical men found themselves opposed in the case of unilateral disarmament too. The Labour Party had always been perceived as pacifist. Both the world wars presented Labour with dilemmas. The party’s pacifism had never lasted throughout the whole war conflicts. From being anti-war before and at the beginning of the wars, the party always undertook a change of heart.

At the beginning of the 60s the stream of thoughts in the party looked strikingly similar to that observed during the wars. At first, it was the left, which favoured unilateral disarmament, that was in a majority. The numbers on the left were increased by the largest trade union, the Transport and General Workers. This was a new situation in the party in which trade unions and the leadership had traditionally occupied the same ground. Now the right-wing leader, Gaitskell, could no longer rely on trade unions as he used to do. The left wing was deeply worried by the threat of nuclear warfare and its representatives expressed their concerns about nuclear warfare at Scarborough Conference in 1960 where a resolution demanding unilateral disarmament was passed (Rodgers, 171).

A year later the party underwent its notorious change of heart in view of two facts.

First was the pressure from abroad where other social democratic parties expressed consternation at Labour’s decision at Scarborough Conference. Second and more important was the effect of the internal dispute over the unilateral disarmament issue between the left and the right. The disputes were believed to contribute to electoral defeats. The right mobilized its forces and Gaitskell managed to persuade the left to agree on the reversal of the

1960 unilateralist decision claiming that “the survival of the Party itself was at its stake”

(Rodgers, 174). A shift in popular feeling took the edge off the arguments put forward by the left and contributed to the victory of the right that was happy to release the following statement: “We seek the banning of all nuclear weapons everywhere. But the West cannot renounce nuclear weapons so long as the Communist bloc possess them” (Rodgers, 175).

Hugh Gaitskell’s determination to make the party less dogmatic, manifested in his effort to change Clause IV, contributed to the internal disunity of the Labour Party. Labour was not prepared for such a deep intervention yet. The same destabilizing effect had the fundamentalists’ uncompromising stand to public ownership. It was the right that manifested the ability to make a compromise. Unlike the clash over the extent of public ownership, the unilateral disarmament issue saw a pragmatic and constructive approach of Labour’s left that was at last willing to change its opinion. The left also showed the ability to turn to practical policies when the party’s reputation and election outlook were at stake. Though pursuing different policies, the left and the right of the party could make compromises when needed.

WILSON FOLLOWS GAITSKELL

The unity over unilateral disarmament in the Labour Party coincided with the

Conservative decline in popularity. After being out of office since 1951, Labour was now desperate to become the government party again. The seemingly united party appeared to be attractive to the discontented public affected by the ineffective unemployment measures of the

Conservatives. Moreover, Labour could mobilize its forces to voice a definite “no” to the

Common Market. Such a clear answer was perhaps more appreciated than dragging and confusing internal discussions. The clear stand strengthened Labour’s united image, the fact of which was to ascribe to Gaitskell’s skilful leadership. He “had come through fire and survived, accepted now – although reluctantly – by the left of the Party…” (Rodgers, 177).

Sadly, he did not see Labour’s recovery to bring the electoral victory in 1964. Hugh Gaitskell died a year before and was replaced by Harold Wilson.

Gaitskell’s practical approach and his attack on Clause IV in particular shifted the party to the right of the political spectrum. The revisionist form of socialism practised by

Gaitskell became the kernel of Labour’s policy. Labour became viewed as forward-looking and non-doctrinaire (Kenneth, 6). Harold Wilson did little to reverse the trend after the victory in 1964. This was a bitter disappointment for the left that hoped the party would swing back to the left. Their hopes were not illegitimate as they remembered Wilson’s resignation from the government in 1951 when he could not put up with Gaitskell’s modernizing efforts.

However, despite his start on the left, Wilson was “above all a centrist and an opportunist”

(Kenneth, 7), who chose to link socialism with modernisation.

As it is often the case, the word “modernization” meant benefits for some, not for all.

In concrete terms, Wilson made scientific revolution the theme of his leadership. It is not difficult to guess who benefited most from this revolution. The modernization appeal was

“tailored to the managers, skilled workers, professionals and other déclassé middle-class

personnel…” (Kenneth, 7). On the one hand, Labour was well receptive of changes in society that had become more affluent and “middle class”. On the other hand the party had confirmed its move from the initial leftist positions. The left-wingers in the party realized that “the cloth- capped party under Keir Hardie had gone for ever” (Rodgers, 178).

The left, if unwillingly and just because of keeping the party united, assisted to the move to the right, but was far from being reconciled with the state of things in the Labour

Party. It managed not to shatter the image of unity even though it criticized the official Labour policy. The criticism was directed against the leadership and concerned social, income and foreign policies.

Dilution of the welfare state supported by the right met with resistance on the left. In the field of social policy, Wilson continued Gaitskell’s pragmatism more than one would have expected of him. His policy was not too restrictive, but still, he could not possibly hope for too much support from the visionaries who considered the welfare state a basic pillar of the state. Wilson stated clearly that the state was there to help, but this help had to be directly tied up with what the state could afford: “…the future growth of public expenditure should be related to the growth of national wealth…” (Rodgers, 181). I argue that one can notice here the beginning of the economic approach that came to dominate the political scene from the

1980s onwards when tax and spend theory ceased to be a relevant alternative.

Another disagreement followed when the government could not agree on the income policy with trade unions. Wilson was reluctant to promise anything, whereas trade unions sought an agreement that would give workers not only a secure pay, but also a pay rise that would keep pace with inflation. As a result of Wilson’s hard line policy, Frank Cousins, the leader of Transport and General Workers' Union, left the Wilson government in protest.

Wilson himself found himself opposed even by a handful of ministerial associates and other powerful trade unions bosses (Kenneth, 9). Trade unions had been mostly supportive of the

leadership up to Gaitskell when they joined the left in the unilateral disarmament matter. Now they again opposed the leadership, which was another indication of Wilson’s following the

Gaitskell’s trajectory.

Another reason for the disillusionment on the left had its roots in the foreign policy pursued by the Wilson government. The Labour Party had traditionally been seen as pacifistic. Its pacifism turned into a “war strategy” only after no other solution existed. Even then the party emphasized the necessity to end wars speedily. In no way had Labour been in favour of conquering other nations’ territories or pre-emptive wars. Hence a sharp criticism, voiced by the left, followed Wilson’s “servile endorsement of the American policy of mass bombing of the hapless peasants of South Vietnam” (Kenneth, 9).

The fact that Wilson continued where Gaitskell had led intensified disagreements between the left and right in the party. The opposing factions could not agree on the issues of the welfare state, income and foreign policy. The left did not like the idea of Labour moving to the right. The role of the left was to balance the final opinion in the party which now found its supporters mainly among those who had turned rightwards in the 50s. In other words, the

Labour Party was pursuing pragmatic socialism and its shift to the right was reaffirmed under

Wilson. Naturally, the left, represented mainly by the socialist societies and activists outside

Parliament, felt obliged to reverse the trend.

DISAFFILIATED LEFT

The right was dominated the party politics under Wilson. The left desperately needed to challenge the right’s ascendancy. To achieve this, some socialist societies decided to leave the structures of the Labour Party and influence the Labour policy from outside. John

Callaghan called this “the end of entryism” (64). This new phenomenon did not have a major impact on the Labour Party, the fact of which was to ascribe to a deep rooted traditionalism in

British politics where a party has to be affiliated in order to play an important role.

The left-wing societies came to the stage where they felt less obliged to attack the right from within the Labour Party. A “freer action”, that not bound by intra-party structures and rules, became preferable. The Labour Party was not only seen as following a non-socialist policy, but also as no longer a relevant vehicle for enacting a change. The socialist societies thought real politics could be done outside the established environment. However, the traditional political scene proved to be too difficult to get round and the societies, such as

Workers Revolutionary Party and the Socialist Workers Party, got never beyond four to five thousand members (Callaghan, 64). Their impact on the Labour policy was negligible thanks to the traditional nature of the British political scene.

If the societies had not chosen to disaffiliate, they might have been more successful in pushing through their socialist ideas. This view is reinforced by the tactics chosen by the

Militant Tendency that stayed incorporated in the Labour Party and influenced Labour’s thinking. Its importance grew with time and was felt as far as in the 80s when it was finally put to an end by Neil Kinnock who expulsed the Militant Tendency from the structures of the

Labour Party.

The Militant Tendency chose to influence the Labour policy from within. It was a socialist grouping that decided not to do politics outside the established order and preferred

“to remain buried within Labour ranks” (Callaghan, 64). This tactics paid off as the Labour

Party adopted some of the Militant’s policy as regards nationalization. Militant demanded that

Labour nationalize 200 top monopolies and Labour’s Programme in 1973 argued that

“leading financial institutions and twenty five major companies should be brought under state control …to facilitate a fundamental and irreversible shift in the balance of power and wealth…to…working people and their families” (Callaghan, 66). This socialist demand never entered the official Labour policy as it was vetoed by Harold Wilson, the fact of which only confirmed the opinion gap between Labour in Parliament and the leadership on the one side and Labour grassroots operating outside Parliament on the other side.

The 70s was not an easy period for the Labour Party. The left could not bring itself to agree with the official Labour Policy that was tailored more to the right’s needs. The criticism of the left did not ease and its targets remained the same. The left grew impatient of the pragmatic approach of the leadership and Labour in Parliament. The situation was not new as the ideological struggle in the 70s was a continuation of what had started at the beginning of the 50s. What changed was the status of some of the left-wing societies that now chose to stay outside the Labour ranks. These non-affiliated societies attacked Labour’s right without being affiliated to the Labour Party. It was an unlucky tactic that did not bring many results because it ignored the fact that the policy is best influenced from within, rather than from outside the party structure.

DEFEAT OF REVISIONISTS AND FUNDAMENTALISTS

In the middle of the 70s both the revisionist social democracy and its leftist alternative sustained a harsh blow. Though the opposing ideologies had offered different remedies for the party, they shared a conviction that Keynesianism was the key to Britain’s problems. After the

Callaghan government accepted the loan from the International Monetary Fund (IMF), both the revisionists and the fundamentalists lost their battle when monetarism took the place of

Keynesianism.

The 70s proved to be a disastrous time to be in government as the economy was plagued by a world-wide downturn. Britain was badly suffering with the rampant inflation which had peaked at 26.9% in 1975 (Winter of Discontent). The Callaghan government had to make drastic cuts in public spending and implement a tighter control of the money supply because this was a condition upon which a badly needed loan from the IMF rested. The loan was opposed both by the revisionists (Tony Crosland) and by the fundamentalists (Tony

Benn), but Callaghan decided to accept it because it was supposed to ease the country through its financial troubles.

Accepting the loan resulted in two major changes in the Labour Party. First, it was clear now that both the revisionist social democracy and its more socialist alternative had come to an end. Second, the restrictive loan conditions did not allow the government to offer much pay rise to the workers, in the wake of which the relationship between the unions and the Labour government further deteriorated.

The switch to monetarism, as the opposition to Keynesianism, was largely enforced.

The Labour Party found itself in the environment where there was little choice as what to do.

The combination of high inflation and unemployment and the world-wide change of heart as regards how to manage the state economy left the party with little choice. After the WWII

everyone was a planner, whilst “by the mid-1970s, a mix of monetarism and economic liberalism had become the ruling economic wisdom…” (Shaw, 6).

Taking up liberalist remedies to economy meant a breach with both the right and left policies of Labour. Keynesianism had been believed to be vital for the British economy since the end of WWII. Though more appropriately tailored to the revisionists’ ideals, the left had come to accept some of the remedies offered by John Maynard Keynes.

The revisionists considered appropriately regulated, but predominantly privately owned, market system the best way to attain most of the socialist ends (Shaw, 4). The left, however sceptical it was as to the ability of Keynesianism to restrain capitalism, never resorted to the idea of operating outside the market sphere. It acknowledged the role of the market and its drive for economic planning wasn’t to replace the market: “…it [economic planning] was always meant to be market-driven – to take place within a market framework”

(Shaw, 4). Now both the competing factions found themselves defeated by the incoming economic liberalism.

The ideological struggle between the left and the right was won by a third player.

Monetarism and liberal economy had replaced Keynesianism that was never to come back. It can be argued that the Callaghan government did not only fundamentally unsettle both the revisionist social democracy and its left alternative, but also prepared the ground for the

Conservatives led by Margaret Thatcher who embraced a more radical version of liberalism known as neo-liberalism.

WINTER OF DISCONTENT

The in-party turmoil following the loan from the IMF did not cease towards the end of the 70s. On the contrary, liberal economy pursued by the Labour Party after the loan disappointed trade unions and the National Executive Committee (NEC), the chief administrative body of the Labour Party. These two organizations had come to represent

Labour’s left, which opposed Labour’s right represented by the leadership. Impractical demands raised by the named organizations led to the Winter of Discontent that paved the way for Margaret Thatcher. It was the “iron lady” who benefited most from the lingering strikes.

The 70s were dogged by industrial problems, including widespread strikes and trade union militancy. It was ironical that the militancy culminated just under the leadership of

James Callaghan. Prime Minister had built his political career on the connection to trade unions. He had led a cabinet revolt which resulted in the abandonment of a reform of trade union law proposed by the Wilson government and outlined in a White paper called In Place of Strife (Winter of Discontent).

Historically, the party’s right - the revisionists - had tried hard to satisfy trade unions’ needs and sought the balance between the unions, business and government (Shaw, 4). In

1978 this balance was upset as a consequence of the loan from the IMF which made the plans for a pay rise unrealistic. However, an influential player operating on the left, NEC, did not want to hear about any restrictions.

NEC was the chief administrative body of the Labour Party including representatives of affiliated trade unions, the PLP, Constituency Labour Parties and socialist societies. This organization had a significant impact on the destiny of the Labour Party. It turned out to be just another trade union organization in disguise that refused to acknowledge a negative impact its excessive wage demands had on inflation (Shaw, 10). Its uncompromising stand

towards a wage restraint proposed by the Callaghan government was expressed by Tony Benn in the following way: “[The government policy is] rigid, unfair and unacceptable for a Labour electorate” (Shaw, 10). Still, the Labour government sought a compromise and suggested the pay rise be kept below 5 per cent. Trade unions and NEC did not accept this and the Winter of

Discontent came in. (Winter of Discontent).

The Winter of Discontent is a nickname given to the British winter of 1978–79, during which there were widespread strikes by trade unions demanding larger pay rises than those offered by the government. They began in private industry before spreading to the public sector, many of them seriously disrupted everyday life. Trade unions seemed to forget what results a direct action brought to them in the General Strike in 1926. This time they were punished more cruelly as the government of Margaret Thatcher, after winning the 1979 election, passed laws restricting their practises.

The strikes were believed to have a profound effect on voting intention. According to

Gallup Poll, which is an opinion poll frequently used by the mass media for representing public opinion, Labour had a lead of 5 per cent over the Conservatives in November 1978, which turned to a Conservative lead of 7.5 per cent in January 1979, and of 20 per cent in

February (Gallup Poll). The electorate grew intolerant of the lingering strikes and it showed this discontent in the 1979 election.

The Labour Party as a whole, and trade unions in particular, came out defeated from the Winter of Discontent. The public expected Labour to act in order to return things back to normalcy. No matter how much the relationship between the party and trade unions worsened, the Labour Party had still the closest ties to the increasingly unpopular trade unions. The strikes ended too late for Labour. The opinion gap between the left and right contributed to the outbreak as well as to the unexpected length of the Winter of Discontent. The inability of

the Labour government to contain the strikes earlier helped to Margaret Thatcher’s electoral victory in 1979.

THE ASCENDANCY OF THE LEFT

The general election in 1979 rendered Labour’s biggest electoral loss since 1931

(McDowall, 179). The aftermath of the election defeat provoked a period of bitter internal rivalry in the Labour Party. The party had been divided well before 1979, but this time rivalries between the left and right toughened. The division was so sharp that one could speak of a polarization within the Labour Party (Shaw, 21). This happened in spite of the fact that

Michael Foot, who was considered a good reconciler, was elected leader. Foot was thought to be a leader of the left jointly with Tony Benn. He presented himself as a compromise candidate and saw his mission in reconciling the two competing factions (Shaw, 18). The task was not easy and circumstances did not help Foot much. Almost immediately after his election as leader, he was faced with a massive crisis: the creation of the Social Democratic

Party (SDP) formed by breakaway right-wingers. The foundation of SDP was a reaction to preceding discussions between the left and right, the aim of which was to explain the 1979 election defeat. The formation of SDP further strengthened the position of the left that had become the leading faction in the party. The result was a strong socialist manifesto of 1983 that, however, did not deliver the electoral victory.

After 1979 the party’s right was disorganized and unable to stand up to the left that was accusing the right of the electoral loss. The left claimed that the party had shifted away from its traditional base. According to the left the party after 1979 needed to return to a more socialist policy to win the following election. To that aim the left carried out constitutional changes that energized the extra-Parliamentary forces, where the left had traditionally been strongest. The party reform was a result of the dominance of the left and at the same time a necessary condition for making the socialist manifesto.

The left interpreted the election defeat in terms of the failure of the Callaghan administration to serve the interests of the people. According to the left, the people reacted to

the betrayals committed by the outgoing government. They included: diverting from the social commonwealth and deterioration of public services as expenditures had to be cut. Moreover, by insisting on a 5 per cent pay limit, the government had driven the low paid to a spontaneous outburst of protest (Shaw, 23). Therefore, the left argued, it was necessary to get back to real socialist policies. So, once again, there was a call for unilateral nuclear disarmament, withdrawal from the Common Market, widespread nationalisation, redistribution of wealth and power, extension of the welfare state and revival of the economy through interventionist means (Michael Foot; Shaw, 25).

All the proposals made by the left after the 1979 defeat had already been there before.

All but one. The left went as far as to argue for the case of class struggle. It claimed that in order to win the next election Labour must subscribe to “a vigorous prosecution of class politics” (Callaghan, 68). This was rightly seen as too radical since class struggle (a softer name for class war) had never played a major role in the Labour policy. It is true that before

th and at the beginning of the 20 century some left-wing societies had advocated a necessity of class war, but they had been refused by the cautious leaderships of the Labour Party. Even the

1900 manifesto was careful to avoid the wording (Labour manifesto 1900). Now the left went out the trajectory of the moderate Labour movement. Since the right was too weak to halt the left, the whole Labour Party paid a price for the too radical Labour manifesto of 1983 in the end.

The right offered a different interpretation of the 1979 election defeat. It argued that a heavy loss sustained among the working class in 1979 was a result of people’s refusal of the collectivist trinity of public ownership, trade union power and social welfare (Shaw, 23). This set off a reaction of the right presupposing a shift to the right quintessential for the party to come to power again. The right did not come with anything completely new. Their cures went along the lines of what the revisionist social democracy had argued for before.

After the 1979 defeat the right wanted to continue the reforms started by Gaitskell.

However, no reform was implemented because the right lacked the power to do so. The party of Gaitskell and Wilson had centred the Labour policy on the ideas of the revisionist social democracy. Callaghan continued this trend until he turned to liberal economy for help. All these right-wing remedies did not bring the expected result – electoral victory. Of course, there were various hindrances, such as a weakened position of the Callaghan’s minority government, but on the whole the opinion prevailed that the revisionist and monetarist measures were to be blamed for the crushing electoral defeat in 1979.

Before 1979 the right dominated the party. The roots of its domination had traditionally stemmed from the PLP and the leadership. The left, operating mainly outside

Parliament, was well aware of this fact. Therefore it came to the conclusion that in order to be able to push through a left wing policy, power had to be shifted away from the

Parliamentarian circles to the extra-Parliamentary ones.

The NEC and the Bennite left put forward a constitutional agenda that embraced mandatory reselection of parliamentary candidates, the election of the leader under a wider electoral franchise comprising party members, trade unions and Labour MPs. Furthermore, the control of the party manifesto was granted to the Executive at the expense of the Cabinet or the Shadow Cabinet (Heffernan, 67). As a result, the power of the Parliamentary leadership was limited and Labour MPs were made dependent on local activists to the extent they had not experienced before.

Now the left achieved what it had craved for: a decisive role in creating the Labour policy. Having carried out the constitutional amendments to secure its predominance, the left was able to go into the 1983 general election with a manifesto dominated by its ideas. The manifesto contained proposals similar to those expressed by the left in their analysis of the

1979 election defeat. Among other things, it contained pledges to unilaterally disarm Britain’s

nuclear deterrent, withdraw from the European Community and launch a programme of mass nationalisation of industry (Labour Party). This manifesto was very socialist in tone and was famously described by the senior Labour politician Gerald Kaufman as being “the longest suicide note in history” (Labour Party).

The socialist manifesto of 1983 somehow missed the point. It was the work of the left that did not appear to appreciate a changed composition of the Labour electorate. The manifesto was tailored to the needs of the working class, which meant that Labour sought to attract its traditional supporters. Though being still the party with the most working class votes in total, Labour’s share of the working class vote fell from 55 per cent in 1979 (itself a decline in 9 percent since 1974) to 49 per cent (Shaw, 27). One can conclude that by 1983

“the Labour vote remains largely working class…[while] the working class has ceased to be largely Labour” (Shaw, 27). The problem of Labour was that it focused on a too limited sphere of society. In other words, Labour relied on its traditional voters without taking into account that there had been a decline in the number of people who identified with the party.

And if there were some party loyalists, their attachment was of a considerable lesser degree

(Peele, 140). By making a strongly socialist manifesto, Labour lost potential voters not only from skilled workers, but also from other strata of society.

One has to realize that Britain had never been truly socialist. Most working class people wished to improve their financial situations without becoming involved in a class struggle that rhetorically re-entered Labour’s thinking after 1979. The father of the idea of the class struggle, Karl Marx, spent most of his life in Britain and was almost unknown there

“except to a few friends” (McDowall, 161). So by advocating class struggle in 1979 the left might have frightened its electorate that could have considered this manifesto as being at variance with the traditional Labour thinking.

The results of the 1983 general election were sharply influenced by the formation of

SDP. A group of right-wingers in the party opposed the leftward shift in Labour policy following the election of Michael Foot as well as the involvement of trade unions in choosing the leader of the Labour Party. They argued that a new political force was needed to contest the Conservative Party, so they decided to leave the Labour Party and founded the Social

Democratic Party (SDP). The foundation of SDP was a harsh blow to Labour. Already a strife-torn party was further weakened by the fact that twenty-eight Labour MPs joined the new party (Social Democratic Party).

The policies of SDP were described as being “tough and tender” (Social Democratic

Party). This meant that the new party sought a compromise between Thatcherism and old

Labour values. SDP accepted the “tough” Thatcherite economic reforms of the economy, such as anti-trade union legislation and the privatisation of state industries. However, they also advocated a “tender” approach, which included a necessary provision of extra welfare.

The defectors argued that the programmatic swing to the left was not the only reason for them leaving the party. They also disliked the enhanced role of party activists. The founding members of SDP, Roy Jenkins, David Owen, Bill Rodgers, and Shirley Williams, regarded the shift of the power from the PLP to party activists as “the drift towards extremism

… not compatible with the democratic traditions of the party” (Limehouse Declaration).

According to them this was a completion “of a long process by which the Labour Party has moved steadily away from its roots in the people of this country and its commitment to parliamentary government” (Limehouse Declaration). SDP accused Labour of being governed by party activists with the leadership having a very limited power to influence the Labour policy. This was considered to be at variance with the Labour movement tradition which was characterized by a commitment to Parliamentary actions with the PLP playing a decisive role in forming the final policy.

The formation of SDP was one of the worst splits in the party with devastating consequences. The SDP proved that a brand new party outside of the major two ones could fight elections anywhere in the country. The new party was able to attract former Labour voters, so the 1983 election result was another blow to the Labour Party. SDP agreed a pact with the Liberals before the 1983 election, which worked well. The Alliance (the name under which SDP and Liberals went into the election) managed to gain almost a comparable share of votes as the Labour Party. The number of people who cast their votes to the Alliance was as high as 7,780,949 compared with 8,456,934 people voting the Labour Party. However, in the first-past-the-poll system, in which the winner takes it all, the Alliance had to settle for just 23 seats compared to Labours 209 (General Election 1983). The new party, later renamed the

Liberal Democrats, has been continuing its unsuccessful struggle with the two party system up to date.

The formation of SDP had a negative effect on the Labour Party as some of the former

Labour voters found SDP more responsive to their needs. After the creation of SDP the

Labour Party intensified its move to the left. This was logical because those leaving the party were right-wingers whose departure left the party in the hands of the remaining left-wingers.

The right in the Labour Party was in disarray, whereas the left had the upper hand and was a way better organized (Shaw, 22).

After 1979 the Labour Party shifted to the left. The ascendancy of the left was manifested in the constitutional and policy changes in the party, which made the influence of the right very limited. The party’s left had free hands to formulate the Labour policy because the right was disoriented by the 1979 defeat and later on by the formation of SDP. However, the left did not fully make use of the situation. The electoral prospects of the Labour Party were foiled by the unfitting socialist manifesto that failed to reflect both the nature of the

Labour movement in Britain and the changed realities, such as party identification. The

Labour Party could be grateful to the rigid two party system in which the number of seats in

Parliament does not reflect the number of votes cast. The party lost the battle with the

Conservatives, but managed to withstand the attack launched by its former colleagues who defected to form SDP.

KINNOCK’S CONSOLIDATION PHASE

After suffering a landslide defeat in the 1983 election, Michael Foot immediately resigned. He was replaced by Neil Kinnock. Through his leadership Kinnock progressively moved the party to the centre of the British political spectrum though he had no intention to radically modernize the party after 1983: “I do not believe that our current body of policies needs major addition” (Heffernan (2000), 75). After all Kinnock had come from the left, the platform of which he, however, gradually abandoned. In the first part of his leadership – from

1983 to 1987 – Kinnock fought the left that, in his view, had too much power and influence in the party. His grip on leadership was becoming firmer over this period as the power was being shifted back from the extra-Parliamentary leftist groups to the leadership again. Kinnock’s drive to make the centre strong was well demonstrated in the “non-compliance“ issue, in which Labour local councils advocated defying the law, and in the miners’ strike. In both the cases the left was attacked and its position weakened. Although Kinnock’s stand was hesitant, if not evasive, at the start of the issues, later on he indicated clearly where he was pushing the party.

As regards the party policy no major changes could be identified between 1983 –1987.

The socialist manifesto of 1983 was only watered down and on the whole Labour remained a socialist party. It was only after another lost election in 1987 when the party underwent a deep policy transformation to which conditions had been created in the consolidation phase from

1983 to 1987.

Kinnock’s political inheritance in 1983 was not enviable. He inherited “a badly divided and demoralized Party with the programme that the electorate decisively repudiated”

(Shaw, 29). Under Foot the constitutional changes granted power to extra-Parliamentary forces, mainly to party members and trade unions. This contributed to the in-party democracy since a greater number of Labour members had a say in what the party should do.

Nevertheless, such a party was for the leadership and for the Shadow Cabinet very difficult to direct. Kinnock was well aware of this drawback and therefore set out to diminish the role the extra-Parliamentary forces that represented the party’s left.

In order to fasten his grip on the party, Kinnock wanted to do away with mandatory reselection of MPs. He offered a modified version of what became called One Member One

Vote (OMOV) in which “General Committees could, if they so chose, delegate the right to determinate the fate of a sitting MPs to Party members as a whole” (Shaw, 31). Such a

“voluntary OMOV” was a clear attempt to ensure the supremacy of the Parliamentary forces representing the party’s right. Not surprisingly, the left, which was still quite strong, voted against and blocked the voluntary OMOV because it considered mandatory reselection its foremost achievement. Kinnock did not achieve what he wanted, but his efforts came to be viewed with suspicion from the left. Even though the left was still the master in the early years of Kinnock’s leadership, it was gradually loosing its power.

Kinnock’s plan to enhance the role of the right and diminish that of the left was carefully worked out. He demonstrated his strength throughout, and mainly at the end, of both the non-compliance issue and the miners’ strike. He had to proceed very carefully in order to achieve his goals:” …I was always… advancing a little, fighting more, advancing. I had to choose my ground so carefully” (Shaw, 51). His slow advancement could be understood as a good, tactical approach seeing that after 1983 the power of the left remained too significant to be removed easily. So it was only by mid-1985, in the non-compliance case, when Kinnock launched his attacks on “the enemies within”, i.e. the left (Heffernan 2000, 76).

Kinnock did not speak in favour of Labour local authorities who defied the law that imposed a tighter control over their spending. Nor did he openly resist this illegal move. He was clever enough to make the best of the situation. In the non-compliance matter major role was played by Derek Hatton, the leading member of the leftist Militant Tendency. He held the

post of the deputy leader at Liverpool council and openly advocated breaking the restrictive law passed by the Tory government. Though Kinnock did not want to wrangle about illegality

(Shaw, 32) of the action, he did not hesitate to launch an attack on the Militant Tendency in which he described Militant’s practices as follows:

I'll tell you what happens with impossible promises. You start with far fetched resolutions. They are then pickled into a rigid dogma, a code, and you go through the years sticking to that, out-dated, misplaced, irrelevant to the real needs, and you end in the grotesque chaos of a Labour council - a Labour council - hiring taxis to scuttle round a city handing out redundancy notices to its own workers (Neil Kinnock).

This speech was considered to be a final blow to the Militant Tendency that represented the

(hard) left of the Labour Party. Kinnock’s hesitance throughout the arguing turned into the vigorous attack that caused the left to get into disarray.

Another attack on the left was launched when the left-wing leadership of the National

Union of Mineworkers (NUM) commenced, without holding a ballot, a national strike in opposition to pit closures. Here we could follow a story similar to that in the non-compliance case. Kinnock did not support either the left or right in the beginning. For the left he was someone who could go beyond every principle, whereas the right could not forget his half- hearted support for the strike and his not denouncing picket-line violence. He did not openly support the miners nor did he speak against them. It was only after the end of the strike when he no longer felt obliged to maintain solidarity with the left at all costs. The time had come to

“launch an impassionate critique of the NUM Presidents handling of the strike” (Shaw, 35).

Kinnock might have been in favour the miners, but what he could not agree with was the radical tactics the left union bosses chose to use.

One can conclude that by the end of the non-compliance issue and the miners’ strike the power of the left had receded and that of the leadership had grown. The Bennite practice, popular under Foot, to diffuse power among the members away from the centre had been

stopped, though not completely reversed yet. Kinnock’s party was gradually becoming to be dominated by the leadership.

Now when “the leader had acquired a grip on the party machinery” (Heffernan (2000),

77), a policy change could follow, but did not. In the period from 1983 to 1987 Labour did not move to the right too much. It is true that some left-wing policies, such as immediate withdrawal from EEC and statutory planning agreements, thought desirable prior 1983, were quickly excised (Heffernan (2000), 77). On the other hand, even Labour’s right still believed in the “social control of the market to plan production and redistribute benefits” (Heffernan

(2000), 78). Labour still wanted to use the government to direct the economy for politically designated ends with the private sector retaining responsibility for capital accumulation. This policy bore some resemblance to that pursued before 1983, but was generally regarded as less interventionist (Heffernan (2000), 78). On the whole, there was to be discerned no dramatic shift in policy making under Neil Kinnock up to 1987. Rather, there was a very gradual retreat from ambitious schemes designed before 1983. The right was very slowly, but perseveringly, becoming the dominating faction in the party.

The strike’s defeat, the suppression of the Militant Tendency and the change, if quite subtle, to the Labour policy provoked a reaction from the left. Kinnock had become to be associated with the (soft) right and the left was beginning to lose confidence. Its ascendancy was disappearing, which, however, could not be said about its socialist claims. The left was now represented mainly by a coalition of Benn’s Campaign Group and some other interest groups, such as the Labour Party Black Section, Campaign for Labour Party Democracy and

Labour Campaign for Nuclear Disarmament. The calculation was that whatever separated them ideologically all these groups suspected that rethink of socialist policy imperilled principles which they shared. They still clung to the outdated principle of class struggle. They shared a conviction that the manual working class remains by far the chief agency of socialist

transformation (Callaghan, 73). Nevertheless, their voice was less heard than they might have hoped. The power was beginning to set firmly in the hands of the leadership that was slowly moving away from the left.

The 1987 election result confirmed the trend of Labour loosing its electoral base. The working class had changed its composition, which found an inadequate reflection in the policy of the Labour Party. The party had initiated certain changes to its policy, but it did not find courage to more modernizing efforts. As Shaw rightly noticed (80) Labour’s share of the working class vote remained discouragingly low in the sections that were growing (home owners) and highest where the electorate was shrinking (council house owners, union members, and public sector workers). This testified to Labour’s incapability to adequately adapt its policies to the society in which standards of living were rising.

As he set out to do, Kinnock successfully confronted the left, made the party more centralized and thus easier to preside. This enabled the leadership to influence the policy more than it had been the case under Michael Foot. One could argue that the Labour Party put some effort into making the party up to date. Nonetheless, the election result in 1987 sent a clear message to Labour: another and this time deeper revision of the policy was essential.

POLICY REVIEW

After the 1987 election the Labour Party decided to continue a policy of modernization. This time, however, the initiated changes could hardly be described as subtle or minor as it was the case between 1983 and 1987. The second phase of Kinnock’s rule – from 1987 to 1992 – was characterized by a profound rethink of the Labour policy with an ever growing emphasis on the market.

The period saw a certain policy agreement between the right and the left. The policy changes were initiated by both the factions, albeit more vigorously by the right. The conformity of the left contributed noticeably to the changed image of the party. Labour was becoming to be perceived as a party with a market-oriented programme that was gradually leaving behind the old noble socialist remedies.

Labour’s policies were influenced by a newly created political terrain. The Policy

Review, a new Labour policy, was a reaction to three successive electoral defeats that made the party come to the conclusion that a more thorough adaptation of its policy was inevitable.

Labour simply believed that the Policy Review would respond more accurately to the nation’s political and economic outlook that had become influenced by the Conservative rule.

The Policy Review marked a clear and final abandonment of old socialist ideologies.

Its first reports contained some elements of the revisionist social democracy advocated from the 50s to the middle of the 70s. At that time the revisionists belonged to the party’s right. In the wake of the enhanced role of the market, economic liberalism and monetarism the political centre had changed its position. It had moved rightwards. So had Labour’s in-party centre. As a result, the revisionists had become Labour’s soft left and those previously labelled fundamentalists, visionaries or simply the left, had become the hard left. The hard left was forced out by Kinnock in the first phase of his leadership from 1983 to 1987. So there remained the left represented by the former revisionists who were opposed by the right now

represented by the modernizers around Neil Kinnock. As suggested above, the first reports of the Policy Review did not swing away from the revisionists’ ideas.

Nevertheless, the later reports of the Policy Review meant a substantial leap from the revisionist ideals. This meant that the revisionists, now the party’s left, lost their battle from which they have not recovered up to date. The Review Policy, mainly its later versions, could be seen as a precursor to the market-oriented policy pursued by Tony Blair.

While in the past the power of both the left and right factions within the party had been modified by the opponents’ influence, after 1987 the party’s move to the right was not opposed by the left. This was caused by the fact that Labour’s left was disoriented and fragmented. Kinnock managed to marginalize its more radical wing represented by the

Militant Tendency, which had far reaching consequences for Labour’s left. The miserable fate of the left was well manifested by the crushing majorities which the deputy leader, a right- winger Roy Hattersley, was able to muster in all sections of the Labour electoral college:

78.35 per cent of the trade union vote, 60.35 per cent of the constituencies and 57.9 per cent of the MPs (Callaghan, 76).

After the left was pacified by Kinnock, there was not much opposition from the left to the official Labour policy, now formulated mainly by the leadership. The left showed a degree of conformity unknown to its predecessors. It ceased to think socialist remedies an indispensable part of the Labour policy. On the contrary, the left started to advocate supporting the official Labour policy that was now much closer to the market-oriented version of the Conservative government. Michael Meacher, a leading figure on the left, called for the taboo over the market to be exorcised once and for all and argued that there was “no socialist objection to the technical conception of a market” (Shaw, 87).

What influenced Labour’s thinking so much that the whole right and a substantial part of the left came to believe that a shift to the right was necessary? The Conservatives were to

blame in this respect. In 1987 the Conservative Party had already been in power for eight years. This was time enough to shift the political mood of the people. The Conservative rule had changed the political terrain to the extent that it could hardly be ignored by the Labour

Party. There was a consensus that “unless [Labour] can champion the values which the

Conservatives have made their own the game is lost” (Callaghan, 76). As a result, Labour came up with the Policy Review that resembled the Conservative policy to an unprecedented level.

After 1987 a general belief was that prescriptions such as mixed economy and extensive public expenditure were “no longer up to the job” (Heffernan (2000), 66). This view was only reinforced by the conclusion of the report entitled Labour and Britain in the 1990s, which analyzed the nature of the problem in the party. The report claimed it necessary to prepare the opinion in the party for sweeping changes of policy (Shaw, 81). The Policy

Review represented sweeping changes, however gradually they were served to the public.

The first reports of the Policy Review did not see a substantial leap from revisionist ideologies. The Labour Party still acknowledged a certain role for the state in managing the economy, though a distinction was made between the “developmental state” put forward by the left and a pleasant sounding “enabling state” supported by the right. Despite the fact that the theories shared a conviction that an extensive state planning was unthinkable and that a market-based economy had to be accepted, there were some disagreements between them.

The promoters of the former, more interventionist strategy, regarded the market as capable of meeting consumer needs, but on the other hand, they saw it as inherently flawed and unable to deliver benefits to the community. In opposition to this theory, the advocates of the

“enabling” state did not consider a tension between the interests of the community and those of business detrimental. They considered the market imperfect, but not damaging (Shaw, 88).

The indispensable role of the market was not a matter of dispute between the left and the right in the Labour Party. What the factions could not agree on was the question of how to govern the market. The left had its vision of the “developmental” state in which the market had to be checked because it was “often irrational, inefficient, too short term, too narrow

[and] too fragmented to be entrusted with providing the basic decencies to those with little purchasing power” (Shaw, 89). However, the left acknowledged that the market was

“immensely effective and valuable means of allocating …resources…encouraging efficiency…(Shaw, 89). These statements gave evidence to the left’s dilemma of whether or not to trust the market. Under the spur of the market, private companies might be internally effective. Yet, their internal efficiency does not guarantee that resources will be allocated where needed most. Letting business operate freely yields this dubious effect. Therefore the left supposed that a state involvement, though to a much lesser degree than before, was quintessential. As opposed to the past interventionist theories, the “developmental” state suggested a pro-active, strategic and sectoral approach. The state was still to be the only player able to “provide the longer-term perspective, the organizing and coordinating capacity and… the resources to ensure that we make the essential provision for success” (Shaw, 90).

The “developmental” state theory did not find many supporters on the party’s right. In contrast to the interventionists, the “enabling” state theory claimed the public interest be best taken care of by a fully competitive market. Commercial decisions made by private companies were held best since they are driven by their search for profitable outlets (Shaw,

92). Nevertheless, the “enabling” state theory too agreed that the market possessed some defects. So it was Kinnock who argued that the state “should help the market system work properly where it can…and to replace it where it can’t…” (Heffernan (2000), 80).

Both theories mentioned above were equally represented in the Labour Policy approximately up to 1990 when the most prominent advocate of the “developmental” state,

Bryan Gould, was replaced by a more radical reformist Gordon Brown. After Gould’s removal the “enabling” state gained the upper hand in the party. The left, represented by the

“developmental” state, was loosing its ground, whereas the right, now fully supported by

Kinnock, consolidated its position.

Already between 1987 and 1992 the Review Policy was gradually evolving in the direction Labours’ right had imagined. By the 1992 election, the Policy Review had been dominated by the right completely. While in its initial versions the Policy Review acknowledged some flaws of the market, at the beginning of the 90s the right came to embrace the enhanced role of the market.

Under the domination of the right, Labour completely disposed of interventionist practices. The market was left to function freely. Even the early right-wing version of the

“enabling” state theory was abandoned: “…the idea that the role of the state in economic management was…to be an enabling one, performing tasks which the market was unwilling or unable to accomplish was not to be maintained” (Heffernan (2000), 80, 81).

It is here where one can speak of a sharp shift of the Labour policy. By 1992 Labour had cast aside not only planning, but also other socialist planks, such as public ownership, steeply redistributive tax system and public spending (Shaw, 104).

Nationalization and other forms of public ownership lost their credibility for Labour.

The lurch towards privatization by the Conservatives was not very vigorously opposed by

Labour (Kenneth, 14, 15). As regards taxation, Labour wanted to shed the image of high-tax party. Therefore, Labour appealed to business by promising that there would be no net increase in taxation. Following the Conservative example, Kinnock also made it clear that

Labour would maintain a tight rein on public spending (Shaw, 102).

The predominant school of thought in the Labour Party and the policy suggested at the beginning of the 90s were at variance with the right-wing revisionist social democracy that

used to be pursued from the 50s to the middle of the 70s. The revisionist social democracy was tossed aside as the capacity of the state to steer the market had become seriously questioned. With it the hope had been lost that private economic interests could be adjusted to the needs of the social democratic goals of full employment, higher growth and welfare state.

Eric Shaw calls this phase post-revisionism which believed that “it was only the private sector that could create the conditions for full employment, growth and therefore the wherewithal to finance improved public services” (106).

The 1992 election results took many by surprise. Under the leadership of Neil Kinnock the party underwent a deep modernisation. On its move to the centre of the British political scene, Labour’s right was assisted by Labour’s left that also came to embrace the fashionable market-oriented policies. The right intensified the move by pushing through the later reports of the Policy Review that decisively cast aside the revisionist values while paving the way for

Tony Blair. The Policy Review revised the Labour policy to fit the new mood and the new approach to issues which the Conservative government had initiated. Voters took notice of

Labour’s modernizing efforts that reflected better their more individualistic taste. Though the actual election result gave Labour an overall swing of 2.2 per cent (General Election 1992), it was insufficient to gain Labour a victory.

JOHN SMITH’S INTEREGNUM

Labour policy was not too seriously questioned after the 1992 defeat. The left was marginalized, whereas the right firmly in the ascendancy. Other than policy reasons were offered to explain the defeat. It was believed, not unjustly, that the unfavourable press, mainly the Sun , contributed to Labour’s loss. The tabloid admonished of Labour’s victory that was seen as a disaster for Britain (Sheffield Rally). Another cause of Labour’s defeat was considered to be Kinnock’s “triumphalism”. The American style of one of the last rally before the election, the Sheffield rally, was unpopular with voters who considered the convention

“brash, over-American, triumphalist and self-congratulatory, and Kinnock's performance was widely seen as un-Prime Ministerial” (Sheffield Rally). The impact of the convention was believed to be immense. Ahead of the event, Labour was polling a decisive lead over the

Conservative Party, but this was dramatically reduced the following day when public opinion shifted, now placing the Conservatives ahead of Labour (Sheffield Rally).

Kinnock was accepted as a skilful modernizer, but in the wake of two successive election defeats his resignation was inevitable. John Smith was easily elected to succeed him over Bryan Gould who was identified with the left. Gould’s loss confirmed the declined position of the left. But on the other hand Smith was not considered a real right-wing modernizer, so one cannot speak of a victory of the right either. Some placed Smith on the right (John Smith), whilst others, for example Tony Blair and Peter Mandelson, believed

Smith to be “suspiciously ‘old’ Labour” (Heffernan (2000), 82).

Looking at the Labour Party during Smith’s short leadership (1992–94), one cannot identify a major policy shift. Smith was wary of the modernization project started under

Kinnock, but did nothing to undo the measures taken under Kinnock. His leadership saw a conservative (with small c) approach to Labour’s policy.

Smith successfully changed the party rules so that trade unions had less say in the selection of candidates to stand for Parliament by introducing a one member, one vote system.

The limitation of trade unions’ power could be understood as a move to the right and consolidation of power of the leadership. But Smith only did so because he had committed himself to it during the 1992 leadership contest (Heffernan (2000), 82). His stand to trade unions was not unfriendly at all. He made considerable concessions to them as regards rights at work and the commitment to using the state to return to full employment (Heffernan

(2000), 82). Smith also set his face firmly against the idea of revising Clause Four of the

Labour Constitution. He managed to withstand the pressure exerted on him by the right.

Clause Four had remained unchanged until Blair came to power (Clause IV).

Smith was certainly not a right-wing modernizer, nor was he a typical left-winger. On the whole his leadership could be seen as a consolidation of the Kinnockite status quo

(Heffernan (2000), 83). The consolidation of the status quo was a hiatus for the party modernizers who had always wanted to implement a more fundamental policy agenda. Smith stood in their way from 1992 to 1994. Then he died and a modernizer par excellence, Tony

Blair took over.

ANOTHER BUSINESS PARTY

John Smith’s leadership could be seen as a consolidation period for reformers in which the status quo was retained. The Labour Party did not repudiate Kinnock’s transformation, nor did it reinforce it. After Smith’s death the discussions regarding the way the party should take were resumed. “Consolidationists“ argued that only marginal changes to the policy and a more attractive leader were needed in order to succeed in the next elections (Kavanagh, 216,

217). The left was convinced that “Kinnock’s move to the middle ground failed” (Kavanagh,

216). The response of the right was expected and radical: “The party had not changed enough,

[it is] still too much ‘old Labour’ ” (217). As Tony Blair was elected leader in 1994 there was no doubt that he would choose the most modernizing strategy.

Blair’s modernization can be traced on two levels. On the first level he continued

Kinnock’s transferring power from the extra-Parliamentary forces to the leadership and the

PLP. He succeeded in making the right superior over the left.

On the second level one could notice sweeping policy changes that coincided with making the centre strong. The term “New Labour” has been used to distinguish Labour policy from what had preceded it. The changed policy and image of the party have unmistakeably taken Labour to the right and away from its original ideals.

Under Tony Blair the power in the Labour party set firmly in the Parliamentarian circles. The role of the leader was enhanced with the party leadership being disciplined, unitary and centralized, whereas the traditionally leftist extra-Parliamentary party has become uninfluential and dominated by the leadership (Heffernan (2003), 134). Blair was aware of the fact that the strong centre was more predisposed to articulate a convincing policy which would not be diluted by the outdated socialist ideas of the left. Therefore it was his aim to create a strong leadership. He was successful in concentrating the power in his hands to such

an extent that one Labour MP, Graham Allen, remarked that we in fact have a presidential system in Britain (Smith, 60).

The weak leadership was seen as one of the reasons for the past electoral defeats of the

Labour Party. Generally, when the leadership is not able to present the party policy convincingly and when the policy is continually attacked and doubted by the in-party opposition, the electorate is more inclined to interpret this as a lack of consensus and managerial abilities in the party, rather than a thriving in-party democracy. Blair as a pragmatic politician wanted to make the centre a source of Labour policy.

Blair was determinate to keep the party united with decisions made in the leadership.

He was able to establish an “iron grip” (Kingdom, 449) on his party. Speaking of Labour policy Blair assured us that he had “no reverse gear” (Clark). His style of leadership is compared to that of Margaret Thatcher. They both dealt with the opposition within their parties similarly. The “iron lady” did not want to waste any time bothering herself with the opposition in her party, the “wets” (McDowall, 180), whereas Blair despatched “a number of sacred cows to the abattoir” from his party (Kingdom, 333). Blair is a charismatic leader and an experienced orator who managed to guarantee high levels of loyalty to him. The loyalty was, however, more observed in Parliament, rather than among rank and files in the party.

Blair’s “iron grip” was a necessary and at the same time sufficient condition for deep programmatic changes.

Under Tony Blair the party policy was revised in a manner which enhanced the image of the Labour Party as competent and modern. Blair’s leadership is associated with the term

“New Labour”. New Labour is a policy shaped by the ideas put forward by Anthony Giddens who generally argues that social democratic thinking must be altered in order to better reflect changed realities. In a globalized world, one should not try to gain control over the markets, nor should one leave them operate freely. The renewal of social democracy can be achieved

by a set of thinking he calls “Third Way” that should transcend both the revisionist (or classical) social democracy, characterized by state control, high taxation and spending, and

New Right which champions narrow individualism, free markets and nationalism.

To New Labour both classical social democracy and New Right were failures. To take

Third Way means to avoid the wrongs of the “outdated” ideologies (Blair, 30). However, New

Labour has been very careful not to pursue the policy of the classical social democracy, while there has been quite a high degree of emphasis laid on competitiveness and business culture, which are the ideas usually attached to the right.

Before elaborating on the ideological struggle between Labour’s left and right, it is necessary to categorize the competing factions. Broadly speaking, the left is now represented by all the people who do not identify themselves with New Labour. These Labour supporters come mainly from the extra-parliamentary Party, affiliated societies and trade unions. They feel that the principles of the Labour Party have been compromised and that the party has moved too far to the right.

The right in the party is represented by the leadership and the PLP. The right is the engine of New Labour and claims that the Labour Party has had to adapt its policies to better reflect the world of fundamental social and economic change.

The categorization above is not accurate as it does not fully reflect the in-party division. The boundaries between the left and right are not clear and they often overlap as it was the case in the issue of Iraq invasion. While normally the party loyalty among the Labour

MPs runs high, in the question of Iraq 139 Labour MPs voted against their government

(Heffernan (2003), 131). Nevertheless, for the purpose of tracing the ideological struggle between the left and the right I will stick to the categorization suggested above.

Since Blair took power the party’s right and left have not been able to agree on a united policy. The right, the advocates of New Labour, has been accusing the left of being too

“old” Labour (for the right, “old” means everything before New Labour, e.g. both the visionaries, the former left, and the revisionists, the former right), whilst the left sees the reforms carried out under Blair as taking the party away from its origins.

After Blair’s election the right has become a dominant faction, whereas the left had a little say in formulating the party policy. The left has been disillusioned by the replacement of

Clause IV, the proposal of which it could only refuse or accept, not amend (Heffernan (2003),

129), by the introduction of the Private Finance Initiative (PFI), the redistribution policy practised by the Labour government and finally by the introduction of university fees.

The replacement of Clause IV was the first clear indication of where Blair wanted to move the party. Clause IV, drawn up in 1918, had committed the party to the common ownership of the means of production and was considered as one of the socialist tenets of the

Labour Party. Shortly after his election as Leader, Blair announced that he intended to propose a new statement of aims and values for the Labour Party to replace Clause IV. A special conference of the party approved the change in March 1995 (Clause IV). The original

Clause IV could be interpreted as a commitment to nationalization to achieve socialist aims.

By replacing the clause Blair signalled both his mastery of the party and his complete rejection of the past policies, such as nationalisation.

Despite promises made by Blair in opposition, no renationalization took place. On the contrary, upon coming into office in 1997, a new enthusiasm for privatisation was discovered

(Kingdom, 577). This enthusiasm was more noticed in an indirect form of privatization that can be called “creeping privatization”. It consists in inviting the private sector into the public sector whose services were traditionally funded and delivered by the state. the scheme is called PFI and is expected to “refashion public services and the welfare state in line with the needs of the twenty first century” (Denham, 282). PFI is a programme in which the private sector delivers all kinds of works for the public sector, together with the provision of

associated services. In return, the private sector receives payment, linked to its performance in meeting agreed standards of provision.

The Labour Party is divided over the question of PFI. The right-wing leadership, mainly Blair and Gordon Brown, is in favour of PFI, while trade unions and some “old”

Labour thinkers strongly oppose the scheme.

According to the leadership PFI deals are very much more likely to be delivered on time and on budget. A study by the Treasury showed that the only deals which were over budget were those where the public sector changed their minds after deciding what they wanted and from whom they wanted to buy it (PFI: Meeting the Investment Challenge).

Moreover, private sector is said to put its own capital at risk which ensures the delivery of high quality public services (Private Finance Initiative).

Critics on the left are quick to point out that PFI has failed to deliver better value for money. According to the House of Commons Public Accounts Committee almost 25 percent of the public sector involved in PFI projects gets less value for money because of the high prices charged for additional services (Denham, 300).

The case of the left was supported by Private Eye , the British satirical magazine. It collected evidence that pointed to financial failures in some of the PFI schemes. For example, the first major capital project funded by the PFI, the Skye Bridge, had been controversial since its construction was announced. When the Bridge contract was first awarded the partnership estimated it would cost around £15 million, but delays and design changes added significantly to the cost that amounted to around £25 million by the BBC’s estimate (The

Skye Bridge).

Another failure of the PFI was discovered in a privately financed hospital for the mentally ill and people with lifelong learning difficulties. The hospital was accused of putting patients’ lives at risk by breaching every section of the fire safety code (Hencke).

Among the strongest opponents to PFI are trade unions, whose chief complaint is more ideological than technical. Unions call PFI “creeping privatization, whereby more and more public sector workers are transferred into private firms” (Denham, 300). This raises a problem of non-identical working rights of the “deserted” workers. Though having made some concessions to unions, the Blair government cannot fully guarantee the rights of these workers

(Denham, 300).

Trade unions also showed their concern when the Labour Party made an attempt to reform foundation hospitals in 2003. Unions rejected this on the ground that it would introduce the market practices into the NHS (Blitz). The issue is still topical and the stand of trade unions has remained the same. Blair has recently come under fire from trade unions, which accused the leader of abandoning the traditional Labour values with reforms such as foundation hospitals. The party’s left claims that New Labour policies are to be blamed for the declining membership of the party, which can be used as a proof of grassroots disillusionment with the Labour policy. The membership has fallen to below 200,000 – the lowest level since Blair became leader in 1994 (Political News - Party Politics). In spite of the criticism, Blair told the left that he was determined “to continue using the private sector to reform the public sector” (Political News - Party Politics).

Trade unions are now in a completely different position. They used to be very influential and mostly favourable to the Labour leadership. Now their influence is eliminated, they moved to the left as a reaction to New Labour policies. Their declining importance in the

Labour Party is well demonstrated in a changed financial base of the Labour Party. Having provided no less than 75 per cent of Labour’s funding in the early 1980s, trade unions only provided 27 per cent at the end of the 90s. The lost money was compensated by donations from corporations and wealthy individuals (Heffernan (2003), 128).

In their stance to “creeping privatization”, the left was supported by a number of political commentators who argued in the Compass Statement that the trend of allowing business to provide us with its services in the traditionally public areas must be reversed.

They claimed that the risk of “reducing everything to a competitive market” ( Compass , part 5) was running high and that the private sector is no guarantee of good and flexible services.

According to them the public sphere must be reclaimed ( Compass , part 5).

Nevertheless, Blair has been of different opinion than trade unions and the left as a whole. He claims that “citizens don’t care who builds them [schools, hospitals], so long as they’re built”

(Dunleavy, 14).

From ideological point of view PFI represents a retreat from past practices. There is a significant break with “old” Labour that was traditionally less inclined to approve of the private sector delivering public services. In a way PFI might be seen as going even beyond the boundaries set by Margaret Thatcher. New Labour’s willingness to invite the private sector into the services, traditionally provided by the public sector, is the area the Thatcher government never wanted, or felt unable, to enter (Chadwick, 18). In doing what Thatcher balked at the Labour Party created an atmosphere that makes it possible to claim that there is another business party in Britain. This can be confirmed by taking a closer look at the vocabulary used by some right-wing members of the Labour Party. As Heffernan (2000) points out, “a sharply contrasting new economic discourse dominates Labour politics today” and the words such as “…competition, efficiency, productivity, economic dynamism, profitability...” (51) communicate quite explicitly where New Labour stands today.

Traditionally the Labour Party had wanted to achieve equality through the tax/benefit system. Such redistribution has lost its credibility now. For the party’s right, represented by the policy of New Labour, equality in its traditional form has become an outdated term. Both in rhetoric and in practice New Labour seems to have given up the hope of achieving equality

through redistribution politics. There has been a paradigm shift from equality understood as a goal to be achieved through high taxation and spending to that represented by the trinity of responsibility, inclusion and opportunity (Lister, 127,130). It is an attempt to reduce barriers standing in the way of equality. New Labour endeavours to create such conditions in which one could prosper and “get on”. The ultimate goal of this “help yourself” policy is to have people not dependent on the state:”…there is a clear determination to forge…responsibility, inclusion and opportunity through paid work. The central aim …is to reduce welfare dependence” (Lister, 147). The state has changed from a passive provider of benefits to an active partner towards independence.

When being in the opposition, Blair stated: “Labour should advocate a fairer distribution of taxation to ensure redistribution of wealth away from the wealthiest of our community to the poorest” (Heffernan (2000), 51). This statement did not deceive some careful observers in the Labour Party, such as Roy Hattersley, (now a left-winger, who had occupied the party’s right before Labour’s sharp shift to the right), who well predicted that redistribution policies and high rates of progressive taxation would be ruled out under Blair’s leadership. The change of heart anticipated by Hattersley came on surface in the 1997 pre- election rhetoric when Gordon Brown insisted that he would increase neither the top nor the basic rate of the income tax (Toynbee, 123). Later on Brown went further to announce the cut in standard rate to its lowest level for seventy years. The potential gain for those in the top decile was about thirty times higher than that for those in the bottom three deciles (Lister,

135,148).

In the attempt to distinguish its policies from Old Labour, New Labour cannot afford to be socialist. It feels unable to redistribute in favour of the poor – at least openly. Therefore the most “visible” way of redistributing, the increase of the top income rates, is out of question. However, there is a remainder of Labour’s traditional vision in New Labour policy.

Brown made some changes to the contribution to the pension fund that resulted in a tax-rise for private companies from 3.5 per cent of GDP in 1998-9 to 3.9 per cent in 2001-2 (Toynbee,

122). Brown has also introduced mildly redistributive budgets, but could not bring himself to admit it (Lister, 136). If New Labour happens to think of or even carry out redistributive policies, it does not dare speak of it publicly as it could damage the New Labour image. For

New Labour redistribution has become the “r” word (Lister, 136).

The dominating right, represented by the New Labour ideas, has abandoned the idea of direct redistribution. This position is criticized by the left that feels it necessary to redistribute the wealth away from the rich towards the less fortunate. The left claims, in the words of

David Marquand, that “in the context of a growing fault line between the winners and losers…no project of social inclusion will work unless it captures some of the winners’ gains and redirects them to the losers” (Lister, 136).

The right concentrates on redistribution of opportunities, rather than on redistribution of income. Gordon Brown claims that one has to create an environment in which there is a chance “for everyone to realise their potential to the full” (Lister, 136). Opposing this view, the left argues that equality of opportunity cannot be achieved if “massively unequal starting points affect the ability to grasp the opportunities opened up” (Lister, 136).

The “massively unequal starting points” were created by Margaret Thatcher who accepted inequality as a natural and desirable thing, as an incentive, which makes people more hard working. As a result of the Conservative attitude to inequality, the real incomes of the bottom tenth of the population fell by 9 per cent between 1979 and 1996-7, while the top tenth could enjoy an increase of 70 percent (Lister, 130). The Labour Party inherited the country ”scarred by levels of inequality and poverty exceptional by both post-war and international standards for an industrialized society” (Lister, 130).

New Labour responded to its Thatcherite inheritance by going determinedly beyond

“old” left thinking of redistribution through the tax/spend system, while forging the redistribution of opportunity. The left argues that this policy cannot be working as the gap between the rich and the poor had been widened so much by Thatcher that only a determinate effort to reverse the trend can make amends to the situation. Otherwise the starting lines remain unequal and so do the possibility to make use of the opportunities opened up. In short, the left calls for a more direct redistribution of wealth, which Blair will never agree to for a fear of frightening the voters of middle Britain who would not like to see their consumer habits restricted by a too high tax burden.

Another dispute between the left and the right was to be noticed over the issue of higher education. In the first term, the Labour government introduced an annual fixed tuition fee of around £1,000 for higher education students. In the second term Blair introduced “top up” fees with the maximum limited to £3,000 per year despite a pledge not to do so made in the 2001 manifesto in the section Education - Labour's number one priority . (2001 Labour

Manifesto). The introduction of university fees, let alone the “top up” amendment, was criticized by the left and defended by the party’s right.

The right claims that fees are the only way to secure the necessary funds to the universities. It is believed that an increased level of fees will result in a cash injection and prevent the underfunded British universities from collapsing. Additionally, there is a need for

British institutions to be internationally “competitive” in terms of quality and resources. This is claimed impossible to achieve without a reform of their funding (Higher Education Bill).

Moreover, the right argues that since studies show that most graduates earn more during their career than non-graduates, it is logical that they should be the ones to pay for this opportunity, not the public at large. Critics of higher education fees have argued that if graduates earn more money than non-graduates, they will pay more income tax after they

leave university. Some have also pointed out that the country as a whole benefits from an increased level of expertise, and therefore it is in everyone’s interests to pay for higher education (Higher Education Bill).

The most common criticism of the proposals is that tuition fees will increase the level of debt graduates will have after they leave. Organisations such as the National Union of

Students, representing approximately 98 per cent of all UK students (National Union of

Students), have argued that students are already under too much financial pressure, and that this will make things worse, not better. According to the Union many students have had to take up part-time work in order to pay living costs while studying, and “this has been shown to have an adverse effect on their studying results” (National Union of Students).

Furthermore, the left maintains that in contrast to the government’s aim of increasing the proportion of students going on to higher education to 50 per cent by 2010 (2001 Labour

Manifesto), it is predicted that people from poorer backgrounds may be put off from enrolling for a degree (Higher Education Bill).

The introduction of fees has also been under criticism for another reason. It represents a step towards the privatisation of education making degrees into products. Here one can notice a parallel between “creeping privatisation” represented by PFI and university fees. In both the cases there is a tendency to free the government of financial expenditure. In the former case the financial burden is ceded to private companies, while in the latter to individuals. A common denominator is to increase quality by introducing a sense of competitiveness into the public sphere. New Labour sacrifices ideology to whatever works (or is assessed to be working in future). In the case of university fees there is likely to be a perceived trade-off between price and quality when choosing a degree. The strict limits imposed on fee levels limit this in practice, but the concept of competition remains.

Some arguments of the left, such as the link between having to pay the fees and students’ debts, can be challenged by an income-linked deferred payment added to the bill:

“Instead of having to pay each year while studying, students will be charged for fees once they start earning more than £15000 per year. The government will pay universities the fees, and then claim them back as a no-interest loan” (Higher Education Bill).

The main argument of the left runs along ideological lines. The Labour Party had traditionally been supportive of free university education. Therefore the Labour government should look for alternatives to university fees so that the students from socially poor background would not be discouraged from enrolling for a degree.

University fees remain a controversial issue in the Labour Party. The Higher

Education Bill introducing “top up” fees was passed by 316 votes to 311, with 71 Labour

MPs voting against (Higher Education Bill). Quite a high number of rebelling MPs testifies to the controversial nature of the issue since, normally, Labour Mps are loyal to the leadership.

In this case, as well as in the case of Iraq, the division line between the left and the right is not clear as the traditional left is joined by many representatives of the party’s right.

The ideological battle between the left and the right under the leadership of Tony Blair has been heavily won by the right. Tony Blair has managed to maintain the power in the leadership and in the PLP. The party has been disciplined enough for the New Labour project to continue. The left had ceased to be influential under Neil Kinnock and has not been able (or allowed) to recover under Blair. There are number of policies that bear out Labour’s shift to the right: the removal of Clause IV, the readiness to invite businesses into the public sphere, the insufficient effort to tackle inequality directly through income policies and finally the introduction of university fees. New Labour has distinguished itself clearly from Old Labour, i.e. the party’s left, whose prospects seem to have been buried once and for all.

CONCLUSION

Socialist groupings and trade unions had aspired to improve the living standards of the working class well before the Labour Party was formed in 1900. They shared the aspiration, but differed in how this should be achieved. Thanks to the mediating role of the first Labour leader, Keir Hardie, the adherents of the Labour movement managed to agree on the necessity of implementing their socialist ideas through a new Parliamentary party.

Once Labour had entered Parliament, the party’s left and right emerged. The ideological struggle between the two competing factions manifested itself in numerous discussions on the nature of socialism. This was a vital process that contributed to the democratic nature and loose federal structure of the party up to Neil Kinnock. Then power shifted to the leader and the left was marginalized. Finally, Tony Blair, influenced and inspired both by Kinnock and Margaret Thatcher, accelerated the party’s move to the right of the British political spectrum. The party’s right has become the unchallenged policy maker in the Labour Party today.

Historically, the ideas put forward by the left and right did not remain the same, but evolved over time. The left consistently fought for “real” socialist ideas. From the in-party perspective the left has been perceived as the more radical faction with policies including class war, pacifism, nationalization of industries, a greater role for the public sector, more generous social welfare and redistributive income policies to fight inequality.

The right rejected the concept of class war from the very beginning. Neither did it approve of the pacifism of the left during the world wars. The right advocated limited nationalization and moderately interventionist policies, with ever more emphasis laid on the market. Privatization, the enhanced role of the private sector and equality through opportunity have become the kernel of the policies of the right today.

The party’s left and right were best able to respect each other and cooperate during the world wars. The fact that the ideological dispute was put on hold until the war conflicts ended testified to Labour’s overall pro-nation and constructive approach.

With the exception of the war periods, the ideological conflicts between the left and right have accompanied the party since its beginnings. The right was strongest in the leadership and the PLP. Trade unions had been supportive of the leadership up to Hugh

Gaitskell. Then they gradually started to leave the party’s right, the process of which culminated under Neil Kinnock and Tony Blair. Labour’s sharp swing to the right started by the former and intensified by the latter has caused trade unions to move to the party’s left.

Throughout the party’s history the right has dominated the in-party ideological discourse. Its policies were more representative of the whole Labour movement that was characterized by a constructive, peaceful and democratic approach. The right was more able to capture the essence of British society that preferred changes to be enacted peacefully, gradually and through constitutional means.

For the party’s right the word “socialism” meant socialist policies that best fitted the unique nature of British society. It would perhaps be better to talk in terms of social democracy rather than socialism in the British context. Socialism is the opposing set of beliefs to capitalism and as such it has never found much of a footing in Britain. On the other hand, social democracy could be seen as the “friendly face” of capitalism. Though it does not consider the removal of capitalism necessary, social democracy wishes to cushion negative effects of unrestricted capitalism, such as market volatility.

The policies of the Labour right evolved from practical socialism into the revisionist social democracy that dominated Labour’s discourse from the 50s to the middle of the 70s.

Then the social democratic foundations were shattered by the (largely enforced) adoption of

the liberal economy. Nevertheless, social democracy managed to live on and found some reflection in Labour’s policies until it sustained a final blow by New Labour.

New Labour has cast aside social democracy and come up with a new, business- oriented, approach to things. This is considered necessary because we live in a world of fundamental changes brought about by globalization, unfavourable demographic development and the rapid economic advances of some developing countries.

New Labour has fundamentally changed Labour’s in-party political terrain. It has brought in a completely new division between the left and right in the party. Everything pre- dating New Labour has been labelled as “old” and irrelevant, i.e. left-wing. Hence the party’s left now comprises the former right-wing – revisionist social democrats and trade unions. This

“new left” opposes the “new right” which emerged in the Labour Party with New Labour, and which bears more resemblance to the New Right of Margaret Thatcher than to its predecessor, the revisionist social democracy.

Labour’s left has not been as influential as Labour’s right because its main support came from the extra-Parliamentary forces, but Parliament is the political centre. The left has spoken through the affiliated societies and in recent times through trade unions. One Labour leader (Michael Foot) and some ministers (e.g. Aneurin Bevan) belonged to the party’s left, but they were in the minority as both the leadership and Labour Mps (in short Labour in

Parliament) traditionally constituted the party’s right. After the emergence of New Labour, the left has been much easier to map as it consists of all the opponents of New Labour.

The left interpreted socialism differently from the right. The interpretation of the left was more in tune with the political terrain on the Continent. In Britain the working class was less receptive to the radical changes suggested by Labour’s left. “Real” socialism as advocated by the left found few followers in the Labour Party.

At the beginning of the Labour movement the left advocated class war which would result in the overthrow of capitalism. The advocacy of the Marxist line of thinking on the left was counterbalanced by the moderate left and the party’s right. According to the left a more radical socialism with industry in the state’s hands was needed to “secure for the workers by hand or by brain the full fruits of their industry” (Clause IV). While class war was swiftly refused by mainstream opinion in the Labour Party, nationalization had become a pillar of

Labour’s thinking, which showed a certain influence of the left on Labour policy.

The left used to play a more important role in the party after the world wars that made the whole political scene more receptive to socialist policies. However, one could hardly speak of the dominant position of the left as after WWI the left was outmanoeuvred by

Ramsay MacDonald and after WWII there was a general consensus as regards building up the welfare state.

From the 50s to the middle of the 70s the left was a relevant, though not dominant, alternative to the revisionist social democracy advocated by the right. The visionaries promoted public ownership and unilateral disarmament. They found supporters even in the government, where Aneurin Bevan vigorously opposed the revisionist case.

The left was at its height after 1979. Britain was governed by Margaret Thatcher, to whom the Labour Party felt obliged to form a left alternative. Under the leadership of Michael

Foot, the party made constitutional and policy changes of such an extent that one could speak of the party being dominated by the left for the first time in its history. Nevertheless, the three year interregnum of the left ended in a massive electoral defeat, after which the right resumed its dominance of the party.

In 1983 Neil Kinnock took over and the left started to lose ground. Since 1983 the right has been in the ascendancy, whereas the left has been marginalized. Kinnock started the

process of organizational and policy changes that culminated in Blair’s New Labour, under which the left has not been able to recover.

Up to Neil Kinnock the left had played an important role in forming the Labour policy.

The role of the left had rested in balancing the opinions of the dominant right. The left used to be a relevant player in the structures of the Labour Party. Since the reformation started under

Kinnock the position of the left has deteriorated dramatically. The tenets of the left are no longer taken seriously, which was well demonstrated at the 2002 Party Conference. Although the delegates, elected by Constituency Labour Parties, affiliated trade unions and socialist societies, called for a review of the Private Finance Initiative by 67.2 per cent to 32.8 per cent, the leadership made it immediately clear that they would ignore the vote (Heffernan in D,

131).

In the past, the party’s right had to fight hard to push through its policies in the party.

It is enough to remember Hugh Gaitskell’s mobilization to persuade the left to agree on the reversal of the 1960 unilateralist decision taken at Scarborough Conference. Now the process of decision-making looks strikingly different. The party’s right does not mobilize its forces when it wishes to put through its policy. It just ignores the left.

Effective decision-making in the Labour Party resides with the leadership and the

Parliamentary Labour Party of whom the most important individual is the leader. In other words, the right dominates the Labour Party today. The party might speak with many voices, but it remains the case that fewer voices than ever determine its political direction.

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