Arrested development

Blair’s lack of self-awareness notwithstanding, his intervention has exposed Labour as a foundering, empty vessel, bereft of thinking.

Written by Jonathan Rutherford, Future of the Left

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A pathos has descended on Keir Starmer as the long shadow of Tony Blair once again casts itself over the Labour Party. Having ejected and disowned him in 2007, the party has been stuck in a state of arrested development ever since. Starmer has failed to help it grow and flourish. Its fateful loss of working class support, gathering pace since the 1970s, seems remorseless.

Tony Blair’s essay, ‘The Labour Party is Playing with Fire Over Its Future and the Future of the Country’, published on 26 May, warns against a leadership contest in which none of the contenders have a plan for government. He offers a coherent analysis of the political situation, and provides a diagnosis of the problems. For example: Net Zero and the high price of energy is hobbling economic growth; the ballooning welfare budget and the triple lock are unsustainable; illegal immigration is undermining border security; and inadequate defence spending is putting at risk Britain’s security. He sets out his prescriptions: reform welfare, end the triple lock; drill in the North Sea; cheap energy prioritised over clean energy; deal with the small boats by ‘whatever means’; and embrace the AI revolution.

His intervention calls for responses in kind. Does anyone believe that Keir Starmer wrote his critical response to Blair’s essay or that his engagement with its content was more than cursory? It’s impossible to imagine him using the phrase, ‘the Great Moderation’ or uttering , ‘a ‘doom-loop’ so fiendish that escape was utterly inconceivable.’ In his own name he contradicts his proceduralist approach to governing, declaring that ‘government is not a to-do list’. Again in contradiction to his performance in No.10, he criticises Blair’s technocratic approach. ‘The question should not be about individual policies. It should be about whether or not we have taken Britain forward in a coherent direction, consistent with our mandate?’ The resounding answer being, ‘you haven’t’.

Is this unfair on Starmer? Better late than never that a leader defines the purpose of his government. Only it is too late for Keir Starmer. It is Blair’s essay, agree with it or not, that captures people’s attention. No-one will believe Starmer’s response expresses any deeply held convictions. Whoever wrote the response can’t attune to his ‘political voice’ because he doesn’t have one. And delivery by Substack only reinforces the sense of a random isolate giving an opinion outside any political context .

Blair’s intervention has brutally exposed Labour as a foundering, empty vessel, bereft of thinking. He is wrong to say that the problem of the party’s intellectual impoverishment stems from Corbyn’s time. It began after New Labour came to power in 1997. All the revisionist work done in opposition stopped and nothing has been done by Labour since in the way of understanding, culturally, sociologically, economically, the radically changing country it wished to govern.

The immediate response to Blair’s essay from the principal leadership contenders, Wes Streeting and Andy Burnham, was to fall back on an ageing trope of the left, accusing him of failing to address inequality. It was a jaded grab at a dimly remembered orthodoxy circa Labour 2010, an abstraction which never played well with the electorate. Did Streeting and Burnham have a clearer idea what they meant by inequality and what to do about it, than Starmer talking about doom loops?

In an interview in The Sunday Times with Josh Glancy on May 31^st, Streeting acknowledges that Labour lacks ‘intellectual curiousity’. It took office unprepared, and consequently it has calcified into a ‘barren government in terms of values and arguments’, stricken by a ‘suffocating tyranny of silence’. He points the finger of blame at Starmer, Rachel Reeves and Morgan McSweeney. But Wes, you too were part of this profoundly disillusioning failure and the bitter disappointment it has brought to so many loyal supporters. The problem goes beyond individuals, it is structural and the symptom of an organisation consigning itself to history.

Burnham, in an op-ed in The Times on 28^th May, blames the country’s crisis on ‘40 years of neoliberalism’ and a failure of regulation. Starmer’s response to Blair blames the 18 years since the financial crash of 2008. Burnham’s longer view is right, but what is the meaning of neoliberalism? It can be used to stand in for the absence of a theoretical understanding of the historical forces, policy choices and systemic dysfunctions that have driven this country into the ground.

In 2020, after Starmer became leader, an effort to rectify this was agreed at the top level of the party. Over the following eighteen months over 100 people from across the Labour Party, including a number of Labour mayors and members of the shadow cabinet, took part in ten working groups to produce the first stage in a Resources for National Renewal programme. It produced a short political, economic and historical analysis of the country to stimulate a larger debate within the Labour leadership. The debate never happened. Despite this, a second stage, a comprehensive manual for levelling up the country, was produced. It too met the same fate.

The programme identified how the Thatcher government had begun the integration of the national economy into the growing global economy. To construct new markets, Conservative policy created a highly centralised state and undermined the independent powers of local authorities. Britain’s productive base was switched to low wage, non-unionised countries. In off-shoring production and warehousing, the country was exposed to ever greater dependence upon just in time foreign supply chains. Scotland’s capacity to exert domestic control over its economy was steadily undermined.

The consequences were an increasing concentration of corporate economic power and the growth of Scottish nationalism. The associations and institutions that created stability and security in industrial communities began to disappear. Social disintegration impacted hardest on the poorest who lacked the resources for an individualised way of living. In the worst hit areas secure family life and the norm of regular work collapsed. Whole communities were pauperised.

By the nineties, the industrial regions were covered with derelict factories, boarded up mills and rusting machinery. While these regions were impoverished, living standards rose for many in the South-East, but the country was living off the sale of public assets built up over generations.

Both Conservative and Labour governments gave up control of key strategic utilities and manufacturing capabilities. More than other OECD countries, Britain had relinquished democratic leverage over national economic development. In 1997, when New Labour came into government it adapted to this new economic settlement. In 1998 its Competition Act boosted mergers and acquisitions. Major British companies were bought up by overseas buyers. Public assets and services were privatised and outsourced.

The New Labour government successfully rode a lengthy period of economic growth using its tax surplus to fund public services, build new schools and hospitals, and subsidise employers low wages with tax credits. Using the ideas of New Public Management Labour introduced market-based criteria into the running of public services in an effort to boost efficiency and productivity. Constitutional reform devolved power to the nations and incorporated the freedoms of the European Convention of Human Rights directly into the British legal system. Globalisation was uncritically embraced. Immigration which brought diversity and a boost in GDP was a social good. The supranational power of the EU was the future.

At Davos in 2000, Blair spoke of his vision: ‘the chance in this century to achieve an open world and an open global society.’ By embracing the free movement of goods, capital, services and people New Labour precipitated a backlash against the party in its own former industrial heartlands. What Labour politicians called progress, was experienced by many as the destruction of their way of life and of their country. Wage stagnation, along with the growing disenfranchisement from and distrust of Westminster government led to the inevitable backlash of an anti-elite, nationalist populism.

By 2008 and the financial crash the British economy was characterised by rentierism, which the academic Brett Christophers defines as a form of non-productive wealth extraction. This is ‘income derived from the ownership, possession or control of scarce assets under conditions of limited or no competition.’ These rent producing assets had multiplied in the aftermath of the Conservatives 1986 ‘Big Bang’ of City deregulation to include housing, land, public sector contracts and privatised utilities, digital platforms, intellectual property rights, and a proliferation of financial assets.

Hayek and the Austrian School would not recognise this dysfunctional economy as ‘neoliberal’. There is little to gain blaming New Labour and ignoring the good it did. However it is not separate from the history that has brought us to this crisis and which created the blowback of national populism. Blair lacks self-reflection in his insistence otherwise.

In his time, he was what the sociologist Max Weber (1864 -1920) called a charismatic leader who had an ‘inner calling’ to rule. Charisma, writes Weber is a ‘creative revolutionary force’ of change. When Margaret Thatcher, another charismatic leader, was asked about her greatest achievement, she answered, ‘Tony Blair and New Labour. We forced our opponents to change their minds’. In his turn Blair said in a BBC interview in 2013, ‘I always thought my job was to build on some of the things she had done rather than reverse them’. Weber explains how changes brought about by charismatic authority become routinised in everyday life.

The political legacy of the period up to 2010 dominated by these two charismatic leaders is larger than their own not insignificant political differences. The new system of ideas, beliefs and practices it gave rise to have been systemised and extended into the state, the apparatus of NGOs and Quangos, party organisation, and the judiciary. With this routinisation has come a political accommodation with the professional and managerial class which controls these bodies and institutions. In the words of the German sociologist Karl Mannheim (1893-1947), ‘all problems of politics are turned into problems of administration’.

Keir Starmer did not only inherit the legacy of Thatcher and Blair, he is a product of it and embodies its ideology.

Burnham is inching toward recognising that something larger than falling living standards is driving what is best described as an English nationalist revolt against the post-national, progressive settlement and those who upheld its ruling consensus. The Westminster class is accused of ruining the country with mass immigration and disastrous economic policies. The middle class that dominates the state apparatus has trashed the things that matter to people. Can Burnham grasp the scale of what is at stake, bend history to his political will and break with the old political settlement? The country awaits an answer.