Britain feels like it’s in crisis. It’s a crisis Labour’s stock response to every problem, spending money, can’t answer.
The most chilling moment in David Lammy’s brilliant book about politics after the riots comes when, soon after he’d taken over as Prime Minister Gordon Brown asked Lammy what was on his mind. Knife crime, the MP for Tottenham said. Brown’s response was tax credits. For the Brown the collapse of purpose amongst young people in the inner city was crude – money.
Too often, Labour imagined spending money would miraculously create a better society. This obsession with spending money has meant when budgets are tight, we don’t have a credible story about what we’d do in power.
As Graeme Cooke, Adam Lent, Anthony Painter and Hopi Sen argue in a recent Policy Network pamphlet, Labour can only win again if we convince the public we’ll get the public finances back into the black. They’re right to think balanced budgets are a precondition for political radicalism. <
But that means a dramatic change in the instincts of Labour politicians and activists: an end to our weird fixation with cash. Socialism is about how we organize together, not just how much money government spends on the poor. Getting into the black needs Labour to turn blue.
For most people, money is produced by work. It has meaning because it sustains our relationships with the people who matter. It buys the food we eat, the presents we buy our children. When people start talking about how much they’ve spent rather than the real difference the things they buy made to our lives, something’s gone badly wrong. But that’s what Labour did in power.
Remember all those leaflets we shoved through letterboxes during the last 13 years? Doubling spending on the NHS, £45 billion to rebuild our schools. The cash did make a difference. Things worked fine when public spending was funded by taxing bank profits during the boom. But when people found it harder to make ends meet, Labour just seemed flash. It looked as if spending money, not a better society, was the end we were after.
In a weird way, Labour’s money fetish converged with the amoral mentality of the worst parts of capitalism. Life for the worst bankers and the best Labour ministers was understood as a series of numbers on a spreadsheet. If it’s just about money, politics is reduced to amoral calculation, and the purpose that drives our movement squeezed out.
To defeat this catastrophic coalition we need a clear plan about creating a better capitalism and better society. Ed Miliband’s ‘better capitalism’ must tell a story about the economy as the source of meaning not just money.
As David Lammy argues, worthwhile work gives people a role to play in society, a story about who we as individuals are. But the proportion of young people with no trade, few skills and little sense of power or purpose in the world at large is a tragedy. It was one of the forces that fuelled the riots. It’s the greatest cause of Britain’s economic decline.
Labour’s mission must be to create the relationships and organisations that develop an economy based on worthwhile work.
To do that, here’s my four-point plan.
First, we need to persuade the British people Labour can be trusted with their money. Prudence needs to make a comeback. We do need to back in black. But the way to do that is political not bureaucratic. Setting up an independent fiscal watchdog, as the ‘In the Black’ pamphlet proposes looks like another way of evading the big question – what would we cut if we were in power. As George Osborne’s catastrophic mismanagement of the economy deepens the deficit, that’s something we need to talk about now. GP’s salaries and defence procurement might be two places to start.
Fiscal conservatism is needed to kill the idea of Labour profligacy. But it isn’t an election-winning platform. Secondly, we need a radical story about the way a Labour government would use the central power of the state to force bad capitalists to behave.
Ed Miliband’s new rules for governing the economy should be about involving workers in the management of big business, not be a ruse for raising taxes. They need to realign the balance of power in corporate Britain. What proportion of employees do we force renumeration committees to have? Do we insist a proportion of profits in large firms are redistributed to employees, as David Lammy proposes? I’m not sure yet. But those are the kinds of questions we need to ask. We need to have the conversation.
It is here, not in the debate on public spending, that we create the clearest line dividing us from the Conservatives. The Tories are politically smart. They know they need to look tough on vested interests. But they’re still wedded to the interests that created the financial crisis – to the people in the City who, unlike most of Britain, are obsessed with money for its own sake. That’s what David Cameron’s failure to sign up to European treaty changes was all about.
Our attack on the City needs to be hard, sharp and smart. It needs to show that finance is not ‘the national interest’. It needs, to show that businesses which are rooted in their local communities are. They, more than anyone else, are the victims of the rootless, money-mad mentality that drives finance capital.
So when he outlines his better capitalism bill, Ed Miliband needs to be standing with authentic voices from parts of the business community which create goods and services that connect to the real meaning people make of their lives. A relationship with the Federation of Small Businesses would be a good start. Asking Tesco to pay a living wage would be another.
But regulation on its own isn’t the basis for Labour’s renewal either.
Third, to renew the role of work as the source of both meaning and money, we need a national plan for vocational training. Labour should make a three-year, partly college-based, partly business-based apprenticeship compulsory at 16 for all children not looking to go to university.
This massive renewal of vocational education can’t be dictates by bureaucrats or the market. It needs to be determined by a national conversation between business, education and unions. Labour politicians then need to organize the relationships between unions, colleges, universities and business in each city and region that would provide it.
Beyond vocational education, Labour needs to lead a renewal of organizing that allow people in the towns and cities of the country to challenge the unfettered forces of the market and lead decent, dignified lives. National unions must stop fixating on government cuts and organise to civilize capitalism where their members are, one firm at a time. The alliance that brought Hitachi to County Durham is a good example of what can be done.
As well as workers, Labour can help organize small business and parents, neighbours, park users, walker, pub drinkers – anywhere where the forces of the unchallenged market threatens to undermine the quality of life.
These dark, angry days call for a political sensibility that prides the quality of human connection not just the cash values contained in a financial transaction. They call for political leadership, local and national, which connects citizens to the institutions and the communities they are part of.
To take up that leadership the shadow cabinet must liberate themselves from Portcullis House. Politicians need to stop worrying what Ed’ll say in his next speech, and start having proper conversations. Labour’s power isn’t just about telling bureaucrats how to spend taxpayers money when we get elected. It lies in our connection with institutions that organize people across society. There is more to politics than policy, more to meaning than money.
As Will Hutton points out, when living standards last stagnated as badly as now, working people organized themselves in local, collective institutions to civilize the unbridled force of the market. The great depression of the 1880s and 1890s led to the birth of the Labour movement we know today – trade unions and cooperatives, socialist societies and eventually the Labour party. In these different times, our movement can renew itself by honouring their memory and organizing the power of people against the power of money once again.