We need a new vision that is worthy of our people and our past

How does social democracy work when there isn’t any money? That is the question that has been taxing those at the top of the Labour Party for some time.

Our immediate, Keynesian response to the crisis staunched the wound and arguably stopped a recession becoming a depression. But the crisis itself showed up the weaknesses of the late 20th century model of social democracy – that of relying on the redistribution of the proceeds of growth, not of changing how that growth affected people early and for the better.

We did not end boom and bust. Economic cycles still happen and our over reliance on the proceeds of finance capital made and still make us deeply vulnerable to shocks to the system. They also made and still make us a deeply unequal country. Not just in terms of how much money people earn, but in terms of how powerful they feel and are.

Today the IPPR is launching a report that will do a great deal of the serious thinking required to set out a new story of social democracy. One that is based around principles that speak to the values the Labour movement has always stood for: The importance of good quality work, the value of contributing to society and fairness in the way society is organised.

Labour needs to spend every second between now and the next election contesting our national story. We need to offer a vision that people recognise as matching the best of our Labour past and speaks to the shared values that has meant they elected us for those values before, but also offers them hope. Hope that we can take the best of Labour values – hard work for fair reward, a society built on solidarity, the empowerment of the many – and rebuild society around them for the long term.

This is not the time to patch together the old systems in the hope that we can fall back on the old solutions. This is a time for radicalism. That may mean challenging our own shibboleths as much as it does tearing down the economic status quo. In fact, for it to mean anything it must do so. If “power to the people” is ever to mean anything beyond sloganeering, we must at all times challenge the hoarding of power and influence – even in our most beloved and treasured institutions – the NHS, the BBC and most of all Whitehall.

We have seen this happen and work in Labour Councils up and down the country. Deep, devastating cuts from central government have led to an outpouring of astonishing radicalism in our town halls. Places like Manchester and Lambeth are leading the way on empowering their citizens to have real say over how their communities are run. There is proof at local government that this agenda works. National politicians who have – on occassion – been scornful of local politics, and have been complicit in the dis-empowering of councils should now look humbly to local government for the leadership they need and the vision it brings.

The Tories are selling us a vision of managed decline. Of the need for austerity to hit services but not for changes to protect the work that services are there to deliver.

But unlike the wreckers in this government, this cannot be an unbalanced and untrammelled attack only on the power of the state to defend its citizens against the ravages of unchecked market Capitalism. If social democrats are to take up the fight for a more devolved, agile state it cannot be simply to further shift the power away from the people. This is why the rebalancing of the economy towards an equal relationship between finance, producers, consumers and workers (and these are not – of course – mutually exclusive labels) must be an essential part of the story Labour tells of the future of our nation.