Sunday, 24 August 2014

Interview: Does that option still exist?

In the year that Tony Benn passed away, a new book looks at the high point of 'Bennism' in British politics. Andrew Fisher, author of The Failed Experiment, interviews John Medhurst, author of That Option No Longer Exists: Britain1974-76, published next week by Zero Books.

Tell us what the book is about? 

It's about a brief period in the 1970s (1974-76) during which Tony Benn and the Labour left tried to implement a socialist economic and industrial policy in government, and how that ultimately failed to come off.  It looks at the reasons for that, and argues that the left's policies for industry and finance were much more constructive than is usually assumed. It is mainly political, but it does briefly cover some of the social and cultural movements of the early to mid 70s as well.  

So what is the option that no longer exists ... 

It does exist, although obviously adapted to 2014. The phrase is a direct quote from Jim Callaghan's famous dismissal of Keynesian economics at the 1976 Labour conference. I used it because it summarised the turn to Thatcherism by political elites in the late 70s, but I wasn't endorsing it!

The book argues that the left's Alternative Economic Strategy was a viable alternative to stalled Keynesianism and rising Thatcherism. Many of its core policies - strategic direction of investment, progressive public ownership, firm regulation of financial markets and the City - are desperately needed today. 

So is it fair to say that the mid-70s represents a critical junction at which capitalism could no longer be contained by the post-war settlement? 

I think it is, although we should distinguish different types of capitalism. The "Nordic model" of Scandinavian social democracy, or even Rhineland capitalism, delivered some real containment of capitalism's worst exploitation and inequality. Those models took a lot longer to fracture than the "Anglo-Saxon" model of capitalism, which was always inherently unstable and which began to turn on the welfare state in the 70s. 

The British economy has always been dominated by the City and by a financial sector that seeks nothing but a quick pay-off regardless of social consequences. Benn's great crime in the 70s was to challenge that.  

In your view does Ed Miliband's "responsible capitalism" offer a challenge to the current model? 

It's a challenge insofar as it represents a mild departure from the fundamentalist neo-liberal model that the Thatcher-Blair years saddled us with, and which led directly to the crash of 2008. So it's better than the coalition's barbaric Victorian capitalism. But we should heavily qualify that: it's not that much better. 

A real challenge would involve extensive public ownership including the banks, tight regulation of hedge funds, support for an international transaction tax, and a massive crackdown on corporate tax evasion. Even that wouldn't be a socialist alternative in itself but it would seriously challenge the dominance of capital over the rest of society, and it would be a good start.  

So what should activists learn from the experience of the Bennites and other socialists in the 1970s? 

Two things, I'd say. The main lesson is, ironically, the one that revolutionary socialists have levelled at the 70s Labour left, which was that it did not have a realistic understanding of the hidden political and institutional forces that would defeat it. The Leninist left said this because it thought that no reformist socialism could ever succeed, but personally I think history shows the opposite - that reformist socialism can establish real bridgeheads in capitalism, while revolutionary socialism is a utopian dream. But the warning is valid. Unless the socialist left has a crystal clear conception of long-term systemic change, and strategies to carry it out, any small advances will be reversed very quickly. So real coalitions on the left - not just here but in the EU and internationally - have to be built up.  

And secondly - as some socialists like the Lucas Aerospace trade union combine suggested in the 70s - is the need not just to control capitalism but to fundamentally question the underlying ethic of "growth" itself.  Unrestricted economic growth is counterproductive. It just leads to faster climate change and social collapse. Without a sustainable, low carbon economy that places quality of life over the GDP, it's a zero sum game. It will all crash eventually. But that is a whole other topic. 

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