‘New’ Labour on the rocks? The last of the lackeys jump ship By Solomon Hughes

3 October, 2009 — The Morning Star Online

I got a sense of the complete exhaustion of the new Labour project when Will Hutton launched a crushing attack on 12 wasted years at a fringe meeting at the party’s conference.

Hutton made his attack in the heart of the Blairite temple, in front of some of new Labour’s high priests, and they responded with a smile and a murmur and little more.

Hutton was speaking at a Policy Network fringe meeting. Policy Network is an “international progressive think tank” founded by Blair in 2000 with Peter Mandelson as president. It is the “third way” made flesh.

Roger Liddle, the first servant of the new Labour gods under the dynasty of Blair, was in the chair.

James Purnell, a junior temple official who rose to the inner sanctum as work minister, was on the panel. Both Liddle and Purnell worked in Number 10 in the first Labour government, they were there when Blair started building his temples to the corporations and launching his wars against the worshippers of other gods.

While Liddle and Purnell did their work for the pharaoh in the name of the new religion of the third way, they didn’t really believe it. The third way turned out to involve pretty much doing whatever the multinationals wanted.

By contrast, Hutton is quite genuinely committed to a third way. His politics and economics do mix together a real interest in putting public welfare above private profit with a commitment to modernising capitalism.

So, on the one hand, Hutton can offer pretty interesting insights into the destructive nature of neoliberal capitalism, but on the other you do get a lot of talk about “experiential businesses,” “flexicurity,” how we “navigate our lives” and a demand that public-sector workers accept zero-hours contracts.

Hutton told the Blairite panel: “Precisely the wrong lessons were learned in the 1992 election, as Brown and Blair retreated further from Labour values and won in 1997 essentially as beaten men. And the problems we now face stem from then.”

Responding to some murmurs from Liddle, Hutton went on: “I think the electorate voted in 1997 for a modern social democratic party, for social investment and reining in the excesses of capitalism, but you [Liddle] and Peter Mandelson were into what you called the politics of assurance.”

This meant assuring the rich and the bankers that they were safe with new Labour.

Hutton continued: “But look, for example, at the Financial Services Authority constitution, drawn up by Brown and Ed Balls in 2001.

“It is essentially drawn up by the City, and it could not question any new financial instrument, the instruments that caused the crisis. Labour bought the neoconservative story.

“The big story is not Tony becoming a neoconservative with his wars in Iraq and Afghanistan. It is Brown joining American economic neoconservatism, giving Alan Greenspan a knighthood and the freedom of Edinburgh – it’s just beyond belief.

“And now we face being reduced to 150 MPs and out of power for decades.”

Faced with this heresy, spoken on the temple floor, Liddle did little more than grimace. Purnell went one stage further – he partly agreed.

Purnell said: “Look at Alastair Campbell’s diaries around ‘96 and Tony Blair became very keen on stakeholder capitalism and you can read them and see it would fit in with Will’s description.”

Indeed they do. Stakeholder capitalism was a moderately social democratic principle asserting that businesses should not only listen to shareholders, they should also listen to stakeholders. The government would force boards to consider the effect on jobs, the environment, welfare and the public good as well as profits.

According to Campbell’s diaries in ‘96, Blair “felt he was on to something with the stakeholder economy idea. It was a way of conveying the economy is about more than money and jobs. It was also about what sort of country we wanted to be … it was a washing line from which to hang all the parts of economic policy.”

David Miliband “was ecstatic” about Blair’s laundry. But it was Brown who stepped in and tore all the ideas off their clothes pegs.

Campbell writes: “It was pretty clear that GB did not believe in the basic stakeholder economy message at all.”

Blair may have felt he was “on to something,” but he wasn’t on it very hard. Brown argued against any demands being placed on capital, so Blair gave up his vague ideas and happily waited for his crown and sceptre instead.

And now, 12 years on, Blair’s priesthood cannot even be bothered to make a defence when their religion is insulted in public.

They seem happy to sit back and watch their pyramids crumble, the nose fall off their sphinx and the new rulers sweep down.

– While Liddle and Purnell gave up on the fringe, there was an alternative strategy on the conference floor. Peter Mandelson demanded there be more real engineering and less financial engineering.

Gordon Brown assaulted the immorality of the bankers. Which means that the other Gordon Browns and Peter Mandelsons, the ones who rejoiced in “lighter than air” industries, light-touch regulation and intense relaxation about the filthy rich becoming richer and filthier, were just imitators.

Or were they the real Mandelsons and Browns? Will the real Peter Mandelson please stand up?

The Labour leadership’s growls against the market and the bankers fail to convince because they spent so long purring in the laps of the corporate elite.

They might rally a few votes, but they are limited by the fact that Labour has done the opposite in power for over a decade.

They do at least show that there is a political space to make these arguments, a task the left should take up if we are not too busy splitting and sabotaging our own initiatives, or launching successful electoral initiatives that promptly self-destruct.

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