SocialismToday           Socialist Party magazine

Socialism Today 119 - June 2008

Taking over Labour

Labours Old and New: The Labour Party 1970-79 and the roots of New Labour

By Stephen Meredith

Published by Manchester University Press, 2008, £55

Reviewed by Tony Mulhearn

THIS REVIEW was a challenge. How do you dig up anything new about New Labour? They appeared invincible, the new masters of the universe, then the subprime mortgage crisis, and the London mayoral and local election results signalled an explosion in the face of the Blair/Brown project.

One of a series of academic works on the labour movement from Manchester University, the editor predictably questions whether the working class, socialism and the labour movement are politically and historically redundant. Recent industrial action by teachers, lecturers, oil workers and civil servants eloquently answers that question.

Stephen Meredith examines the roots of New Labour, the role of the reformist left in the Labour Party and, broadly, the two wings of the right which he defines as the consolidators (around Anthony Crosland and James Callaghan), and the revisionist right (led by Hugh Gaitskell and, later, Roy Jenkins). He digs deep into Labour’s history, revealing in incisive detail the existence of a deeply embedded trend that favoured free-market capitalism. He describes the rupture of the post-war consensus between capital and labour which hitherto had accepted – reluctantly by the former, enthusiastically by the latter – Keynesian policies (public expenditure and nationalisation of key utilities) as a means of rebuilding Britain’s shattered economy.

The conflict between the two strands of the right is viewed through the prism of the European Economic Community (or Common Market, the forerunner of the EU). This was supported by the revisionists, so-called because of their unalloyed hostility to public expenditure and nationalisation, and who favoured legislation to restrict trade union action, and the reformist right which supported the ‘mixed’ capitalist economy and drew back from trade union legislation, which it opposed ideologically. The reformists also recognised the almighty battle that would ensue if they took on the unions, and which would end with probable defeat by party conference.

The author focuses on four distinct periods in Labour’s evolution. Firstly, the attempt after the defeat in the 1959 general election by Labour leader Gaitskell to get rid of Clause 4 (for nationalisation) from Labour’s constitution on the specious basis that nationalisation was ‘unpopular’. This confirms the existence of a pro-market, pro-big business strand of thought which, since the open betrayal of Ramsey McDonald in 1931, had existed in the Parliamentary Labour Party (PLP) and the tops of the trade unions since the party became a mass force. This strand’s influence waxed and waned depending on the relationship of forces between capital and labour.

Secondly, the attempt by Labour prime minister Harold Wilson to impose legislation on the trade unions – outlined in the 1969 white paper, In Place of Strife – which was fully supported by the revisionists led by Jenkins, even at that stage an advocate of pro-market policies that anticipated the monetarist and neo-liberal policies embraced by the Labour leaders in the 1980s and 1990s. Reflecting the pressure of rank-and-file trade union and party members, and with the balance of forces still favouring the working class, the right-wing consolidators uneasily blocked with the trade union leaders and forced Wilson to retreat.

Thirdly, right-wing support for the Common Market. This provoked huge and fundamental fissures within Labour’s ranks, with Jenkins leading 69 Labour MPs to vote with the Tories in 1971 thus gifting Ted Heath’s government success in a parliamentary vote in favour of Britain’s entry. In the eyes of a still-confident labour movement, Jenkins’ action was viewed as rank treachery, and wrecked any chance of him ever becoming Labour leader.

The fourth period focused on revisionist hostility to any increase in public expenditure, which was particularly pronounced during the mid-1970s when Britain had declined as a world power and was dubbed the ‘sick man of Europe’. The pressure of big business was reflected inside the PLP through the right-wingers who demanded cuts in public expenditure. The International Monetary Fund made the same demands. Callaghan, Labour prime minister from 1976-79, and his chancellor, Denis Healey, when faced with the possibility of throwing down the gauntlet to the IMF and mobilising the working class in defence of the Labour government’s limited programme of reforms, chose to submit to the IMF and implement cuts in social spending. This retreat inaugurated the monetarist policies that were subsequently taken much further by Margaret Thatcher, who rode to power on the back of Callaghan and Healey’s capitulation.

The book is shot through with turgid and often incomprehensible language, revealing the continuing attempts by the pro-capitalist right to mask their main objective of freeing capitalism from the restraints imposed by the organised labour movement. It is also a treasure trove for collectors of Orwellian doublespeak. For instance, one source used, A Socialist Case for Joining the EEC, is a speech by then Labour MP David (now Lord) Owen, future leader of the Social Democratic Party. Another is Gaitskell’s Campaign for Democratic Socialism, the object of which was to establish the pre-eminence of the free market. Then there was the Manifesto Group which admitted it adopted the name because it opposed Labour’s ‘left-wing manifesto’ of 1974.

But it is the trade unions that are "perceived by the future New Labour modernisers as representative of some of the worst excesses of old Labour governance". The author poses the question: "To what extent does it support the claim that it was the trade union question that formed the ‘crucial subtext’ of the departure of the Social Democratic Alliance [MPs led by Jenkins and Owen who split from Labour]?"

Callaghan, Crosland and Healey, etc, recognised the pivotal role of the trade union leaders in maintaining the structures of the party both financially and as a conservative ballast against the ‘wild men’ of the constituency Labour Parties. Although they would have preferred legislation to control the ‘excesses’ of the trade union rank and file, they knew they would face defeat at party conference. In contrast, the hard right in the Labour leadership were ideologically convinced that legal control of the trade unions was a key element in reviving the fortunes of British capitalism.

This issue was played out with Wilson’s failed attempt at shackling the unions through to the aborted Tory Industrial Relations Act of 1972. Coming to power again after a wave of industrial struggle, Wilson repealed the act in 1974. It was then re-imposed in a more draconian form when Thatcher took office.

Dick Taverne, a right-winger who openly broke with Labour when he stood as an independent in Lincoln in 1972, summed up their outlook. Leaving Labour, he said, "had as much to do with the attitude to the unions as it did with the Common Market". As an MP for a "very strong left-wing trade union constituency", he said that his support for In Place of Strife "made them [the unions] very bitter towards me".

Such constituency parties, of course, have long been either closed down or purged by the Blair/Brown bureaucracy. They continually boast that, having retained Thatcher’s laws, Britain’s trade unions are the most regulated in the western world.

The book, while studiously avoiding any reference to Militant, describes the emergence of Tony Benn as a tribune of the left, rule changes to facilitate the removal of MPs by their local parties, and the transfer of the power to elect the party leader from the PLP to the party conference, with the trade union bloc vote being a decisive factor in the process. These developments towards the left finally pushed the right-wing strands to coalesce into a bloc which eventually declared the creation of a new formation, the Social Democratic Alliance.

It is not the purpose of this study to analyse the Kinnock/Blair/Brown impact on the Labour Party, which is already well documented. Suffice it to say that the position of the neo-liberals was enormously strengthened by the decisive shift in the balance of forces in favour of capitalism following the defeat of the miners’ strike of 1984-85, the isolation and eventual defeat in 1987 of the Liverpool 47 councillors (led by Militant, the predecessor of the Socialist Party), and the collapse of the smokestack industries.

These events were compounded by the witch-hunt in the Labour Party of Militant supporters, led by Neil (now Baron) Kinnock in collaboration with the trade union leaders, through their appointed hit-men, Tom (now Lord) Sawyer and Peter Kilfoyle, who wielded the knife. Kilfoyle later manoeuvred through the selection procedure to take over the seat left vacant by the death of Eric Heffer, the left-wing MP for Liverpool Walton. Thus, the hitherto minority trend that supports free-market capitalism (first monetarism, later neo-liberalism) conquered the very pinnacle of working-class representation and transformed Labour into a tool for the enrichment of the capitalist class.

This book explains the methods the strategists of capitalism used to capture the Labour Party. It provides a tool for a new generation of socialists to understand the methods capitalism will adopt in its attempts to undermine the class integrity of a future new mass workers’ party.


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