Sunday 18 November 2018

Was New Labour Neoliberal?

There's a weird sort of revisionism going on. We're three years into Jeremy Corbyn's leadership of the Labour Party, and during that time all the received wisdom that governed the Coalition Government years and before - mine included - has gone into the wheelie bin and carted off to land fill. The new politics, characterised by polarisation, the return of big ideas, and the rude intrusion of masses of people into politics, isn't to everyone's taste. The big losers on the Labour side have been the small l liberals and the big N Neoliberals, variously grouped together under the heading of centrism. They still don't know how to explain what has happened to politics, they are certainly stumped when it comes to understanding the appeal and drivers of Corbynism. They are trapped on a treadmill, fooling themselves into thinking that they're moving forward when they remain rooted to the spot.

Unless one is committed to remaining ignorant of understanding what's going on, our present situation has to be located in what went before. Understanding Corbynism means grasping what happened to the Labour party in the preceding decades, its relationship to the constituencies the party articulates, and always the shape and character of political struggle. The means, as always, is class analysis. But by shining a light onto the past to grasp the continuities and ruptures with the present, histories are unearthed and claims are made that make current protagonists in our political dramas feel uneasy. And one of these is Tony Blair, New Labour, and its relationship to neoliberalism. This invites a number of responses. Some deny the very existence of neoliberalism, as per the learned and decorated Professor Colin Talbot who reckons it's a barrier to clear thinking and analysis (ahem). Then there is another school typified by John McTernan and a motley crew of Labour First-types and Blair loyalists: neoliberalism may exist, but whatever it is New Labour wasn't.

Glen O'Hara's latest pamphlet, for the Tony Blair Institue for Global Change, is of the latter school. Concentrating on New Labour's domestic front, he argues that its dismissal as a neoliberal outfit leads to a simplistic view of Labour's past, diminishes the achievements it accomplished in office, and runs the risk of defining the party against a phantom of what it used to be vs the real Tory monster squatting on the government benches. However, by emphasising what it isn't Glen's chosen method misses the important continuities with what went before.

We all need a definition of neoliberalism, and so after sifting through the different emphases different thinkers place on different aspects, Glen settles on that produced by Will Davies. It is
an attempt to replace political judgement with economic evaluation, including, but not exclusively, the evaluations offered by markets ... The central defining characteristic of all neoliberal critique is its hostility to the ambiguity of political discourse, and a commitment to the explicitness and transparency of quantitative, economic indicators, of which the market price system is the model. (The Limits of Neoliberalism, 2017: pp 4-5)
Unfortunately, in assessing whether New Labour was neoliberal or not Glen applies this too narrowly. He evaluates the record in government in terms of whether policy was defined by the drive to quantification, and favouring market competition over other forms of collective provision. The beginning of New Labour's record then begins with the dispersal of the state, or what Glen refers to as 'de-centring outwards'. This, as we have seen involves the hiving off of state functions to alternative providers. This can lead to competition, tensions, and rivalries among the various aspects of the dispersed state but the centre - government - exercises command over them via commissioning and regulating agencies, backed up by central authority. This set up started under Thatcher and Major, and carried on under Blair. Here the system as finessed and sharpened, with the introduction of clear targets into the public services. New Labour also kept on the Tory Private Finance Initiative and used these schemes, which kept borrowing off the public accounts' sheets but cost the taxpayer significantly more in the long run, to rebuild public infrastructure. Acknowledging the draw backs of audit culture, the contracting out of managing public services to private firms, and PFI, once the culture was bedded in we saw a rapid implementation of investment, new construction and, crucially, improvement in services. In effect, these were not simply taken over from the Tories but repurposed to socially progressive and more egalitarian ends.

The rest of the pamphlet carries on in a similar vein. Over the period of government, Labour increased public spending. Funds going to the NHS jumped from 6.1% to 7.9% of GDP, for instance. Education went from 4.5% to 5.6%, and there were real terms increases in funding of policing to the tune of 3.8%/year - slightly below the Tories own funding of 4% between 1979 and 1997. When it came to the other public services though, New Labour significantly outspent their predecessors. This for Glen was matched by a "new contract between consumers and providers". The era of centralised targets moved toward localised commissioning in which, ideally, the public funds would follow the consumer as they accessed services. This underpinned the choice agenda in the NHS, for instance. As Glen puts it,
There was little sense here of a neoliberal emphasis on self-adjusting economic mechanisms that could govern the relationship between citizen and state as they did between retailer and customer. It was more that the state had to improve its performance to meet a moral—not a financial—contract with communities and families.
And following these agendas, crime fell and public services improved. Also crucial here was a commitment to equality, of using mechanisms like education action zones and health zones to target spending and intervention to overcome legacies of deprivation. This coincides with academisation, particularly in poorer areas, and Glen is agnostic as to whether their "freedom" from local education authorities or the injection of cash and making it an area of high policy priority helped turn the situation around in many deprived communities. Also introducing Sure Start centres, and introducing longer maternity leave and paternity leave helped address some of these issues: educational inequalities started narrowing and infant mortality rates dropped. Furthermore, working tax credits, pension credits, more universal benefits, and poverty among the elderly and the young fell.

Nevertheless, Glen accepts that New Labour speak with its talk of targets, prudence, incentivisation, markets and the rest, with the heavy emphasis on employability certainly gives a neoliberal impression. But then again its achievements in spending, public sector renewal, and opening up opportunities to hitherto excluded minorities suggest something a bit more complex. In summing up New Labour's achievements, Glen notes it took a bit of everything from everywhere and given its track record, referring to it as a neoliberal administration is absurd.

Glen's recounting of New Labour's record is broadly correct and largely balanced. For folks new to politics and unfamiliar with the ins and outs, the low down is worth a read. However, what is missing from the account is its authoritarianism. It was not as crass as the pseudo-Victorian nonsense of the Thatcher years, nor was it socially conservative. But, to use a Blair euphemism, it practised "compassion with a hard edge". What this meant in practice is if the unemployed or other social security recipients did not match up to arbitrary "employability" criteria, they met with sanctions. This was not an epiphenomenon of the New Labour years, it took over the vocationalism introduced into education and social security by the Tories and made it their own. The emphasis on choice, be it school, university, or which hospital to go to were entirely consistent with this approach to individualism. We might live in communities and we might not be atomised, but support is only forthcoming to those who help themselves. This authoritarianism was, at times, stridently moral. Caroline Flint, for example, floated the idea of linking council tenancy to work readyness. Though not adopted, this was well within the grain of New Labour thinking. You'll remember the desire to introduce ID cards, extension of stop and search, detention without charge laws, the use and abuse of anti-terror legislation, snooping councils, the heavy-handed surveillance and antagonism of Muslim communities, and happily going along with anti-immigration rhetoric to try and outflank the Tories and the then stirring far right.

Well, if New Labour were authoritarian then surely it couldn't be neoliberal, what with its emphasis on the freedom of the individual? Wrong. Neoliberalism was pioneered in Chile under Pinochet before coming to the rest of the West. Neoliberal economics sits easily with tyrants as various as Vladimir Putin, the Saudi monarchy and, to a lesser extent, the Beijing bureaucrats. Jair Bolsonaro wants to shoot people and build a government in the image of past Brazilian military juntas, but he's totally down with letting the market rip through Brazil's institutions and, tragically, the Amazon rain forest.

All this becomes bewildering unless your analysis of neoliberalism is grounded in an appreciation of how class struggle develops and moves. that is, once neoliberalism is understood as less one kind of economic policy among others, but a managerial strategy: one dedicated to the reproduction and strengthening of prevailing class relations. In this respect, New Labour, despite its achievements in reducing poverty and renovating public services is entirely consistent with this. There are two aspects to neoliberalism. The first is the economic programme, an ideal type of curtailing public spending, privatisation, and using the state to create new markets. At various intervals of New Labour's time in office, it did all of these things and, you will recall, was extremely reluctant to nationalise Northern Rock at the outset of the crisis and promised "cuts worse than Thatcher's" days before the 2010 general election. More significant, however, was the inculcation of neoliberal subjectivity, of forcing institutions to treat us as if we were human beings of a particular type. That is, effectively, mini-capitalists who are acquisitive, make rational choices to maximise individual gain, and follow a path through life that is consistent with accumulation logic. Employability and work readiness, choice, setting up a false dichotomy between producer interests and the consumer.

This is pretty obvious when approaching trade unions, which don't get a mention in Glen's piece. As a Labour government you would expect some enhancement of the institutions that gave birth to the party, right? No. Not only did New Labour rhetoric suggest there was something unseemly about the role of unions in public life, never mind high politics, Blair and co. wanted as much distance from them as possible. It was more than an impression. Unions were identified with the "producer interest" and were therefore barriers to what the government was trying to achieve, especially in the public services. Never mind that what unions were asking for, as per the reneged upon Warwick Agreements, were material improvements to the lot of their members which, in turn, would benefit working people as a whole. No, while keeping contact to unions to a minimum, the kinds of workplace reforms New Labour handed down enhanced individual, not collective interests. More time off for a new born or hospital appointments, great. But significant and far reaching reform that would allow the union movement freedom to organise effectively in the workplace? No. And what is more, there were industrial disputes - holding down the wages of firefighters, attacking civil service pensions, and taking on the posties to soften up Royal Mail for privatisation - immediately spring to mind. There was even the disgusting spectacle of a Labour government farming out miners' injury compensation schemes to the Union of Democratic Mineworkers. New Labour in power inculcated neoliberal individualism, used the power of the state to promote it wherever it could, and ignored its base. The economy grew and public services got better, but it politically immiserated the movement of which it is part, with dire consequences for the Blairist ruling faction later.

I'm not going to berate Glen for failing to write a Marxist account of New Labour's record, but at the very least it required some sociological context and more consideration of not what was going on in New Labour policy brains, but rather what kind of minds the New Labour project was concerned to encourage. "Economics are the method. The object is to change the soul", as Thatcher once noted. The question is was the neoliberal soul made possible by her batons, her police charges, her council house sell offs and utility privatisations left intact and pushed further during the the New Labour years? The obvious answer is yes.


Dialectician1 said...

Thanks for this. I followed your links to the articles from the two learned professors, Talbot and O’Hara, who are keen for us to see neoliberalism as a straw man (or bogey man) created by the left. Talbot attempts to undermine the theory of neoliberalism by quoting from David Harvey’s book written in 2005. Talbot detaches the term from its context and wants us to see it as an ambiguous term, a sort continuation of contradictory relations by state. Harvey, on the other hand, is quite precise in locating it in the first big financial crises since WWII (the spring of 1973 with the Arab oil embargo) and the numerous financial crises since then, leading up the crash of 2008. As Harvey says, “My view is that it (neoliberalism) refers to a class project that coalesced in the crisis of 1970. Masked by a lot of rhetoric about individual freedom, liberty, personal responsibility and the virtues of privatisation, the free market and free trade, it legitimises draconian policies designed to restore and consolidate capitalist class power. The project has been successful judging by the incredible centralisation of power and wealth observable in those countries that took the neoliberal road”. The Enigma of Capital (2011, p.10)

For Prof O’Hara, Blair’s neoliberalism should be understood less as model of political economy and more as a ‘managerial strategy’. But as you say, it is a strategy dedicated to the reproduction and strengthening of prevailing class relations. O’Hara outlines all the supposed successes of New Labour but does admit that Blair’s ‘managerialism’ (managing capitalism but not regulating it) was, unfortunately, harmed by a ‘targets culture’. This led to distortions and perversions in public service efficiency and the current distrust of ‘expert knowledge’. Ironically, O’Hara gives the example of the local management of schools as a success of Blair’s decentralised public-sector. The current scandals over PFI built school and the emerging deficiencies in the ‘academy model’ (Multi-academy trusts with CEO, in charge of clusters of schools, run as businesses) ought to have given him a moment to pause.

I think it is always worth examining the theoretical basis (weird revisionism, as you call it) of attempts by the NeoBlairites, presently waiting in the long grass. People like O’Hara, Chuka Umunna, McTernan and others are desperate to legitimise and detoxify ‘third-wayism’. Glen O’Hara in his obsequious, hand-wringing, article offers us a lengthy review on the successes of Blair’s policies. They can be more succinctly summed up as: ‘a brief golden age’ when the public services opened up some opportunities for the most disadvantaged. What is left of this legacy? Ten years later, the UN report tells us: 14 million are living in poverty; 1.5 million are destitute; Child poverty may rise to 40%; the use of food banks are soaring. Blair and New Labour tried to deny the class antagonisms that lie at the root of living in a capitalist society. As Harvey says, neoliberalism is a ‘class project’ masked by a rhetoric of individual freedom and personal responsibility. New Labour played a significant part in legitimising the idea that capitalism could be successfully managed and that role of government was not the redistribution of wealth and resources but ‘opening up opportunities’.

Johny Conspiranoid. said...

As with anything there's what they said they were going to do, what they really intended to do and what they ended up doing. Mostly they ended up with a giant scheme giving tax payer's money to rich people and for rigging maekets to favour the most powerfull lobby (bribary). A free market would require suitable regulation from a class neutral state.

TOSP said...

New Labour were neo liberal, they introduced internal markets into the public sector, privatised many of the services (outsourcing cleaners onto worse pay etc), increased the gap between the pay of managers and staff etc etc. They peddled the idea that society progressed because of the talent of people in suits. So where New labour had direct control over what changed (i.e. the public sector) they introduced new liberal policies. And where they introduced legislation it was so watered down as to be almost pointless. So increased but meagre union rights alongside decline in union membership, minimum wage alongside more precarious work and zero hour contract culture.

Balirism was a continuation and acceptance of Thatcherism and not any kind of break from it.

“and the rude intrusion of masses of people into politics”

I must have missed this development!

It is lucky I manage to get out, because if I didn’t and all I did was immerse myself in left wing internet sites I would have a very distorted view of the world, similar to if I only ever got my news from the mainstream!