Conservative leader David Cameron is right; this is the end of New Labour, at least the end of New Labour as a viable governmental project. Its major policy planks are discredited and lying in the gutter broken. Its moral pretensions are exposed and its craven contempt for the poor and its worship of wealth and big business are open for all to see.
Following defeat in the local elections, in the London elections and now the Crewe and Nantwich by-election, Gordon Brown’s government and MPs are in panic. Like a headless chicken, however, New Labour does not know it is dead and will continue to run around the political farmyard for some time to come – but pointlessly bewildered and ever-more crisis-ridden, New Labour cannot avoid eventual election defeat.
How has this come about and what will be its consequences? How come New Labour has gone from apparent natural party of government to object of near-univeral contempt?
The curve of recent political development from 1997 shows two over-arching factors, and three specific factors that have left the government’s reputation in ruins. First, over a decade New Labour’s pro-privatisation, neoliberal and pro-wealth policies have leached political support and confidence away in broad sectors of the population. For example, the vast majority of public sector workers, the millions who work in the NHS, teaching and local government, know full well that the government’s reforms in education and health care provision – focussing on meaningless targets and oppressive work regimes – are idiotic and destructive.
In addition, the vast fortunes being made by billionaire Britain are in sharp contrast to the reality for the minority of poor workers whose quality of life has hardly improved over a decade. The scandal of boardroom bonuses in the stratosphere, the vast bonuses paid in the City and the tax fiddles of major corporations that pay no or little tax make there own statement: New Labour doesn’t care about fairness and equality, it is in thrall to the rich.
Despite these this New Labour was able top stay afloat for two reasons. First, in a period of relative economic expansion, wages for regularly employed workers, as opposed to part time and irregularly employed workers, tended to increase alongside inflation. Most people felt they were, despite everything, better off – especially as home owners saw the value of their properties skyrocket.
Against this background, counter-reforms and privatisation and the massive polarisation of wealth were put reluctantly tolerated by millions. New Labour could also point to a substantial increase in the absolute amount of money put into public services (generally to no avail). Tony Blair also benefited from another massive advantage: New Labour was after all not the Tory party, widely despised and regarded – after 18 years of Thatcherite rule – as the ‘nasty’ party.
This unstable equilibrium, carried through to the 2006 general election, had the legs kicked out from under it by two things: recession and war.
The Iraq war and the massive opposition was the first staggering blow to New Labour’s credibility, as everyone who cared to think about it knew that Blair, his lamentable foreign secretary Jack Straw and his openly mendacious press secretary Alastair Campbell, told lie after lie to justify Britain’s support for George Bush’s war. Two million demonstrators in the streets could not but have a massive long-term impact, and of course they eventually did for Blair himself.
But after Blair’s departure in 2007 world economic recession and the new Prime Minister Gordon Brown’s response to it applied the coup de grace that made New Labour a finished, dead as a Dodo, basket case.
That response was to effectively give the Casino-style bank Northern Rock a government handout of £24bn as a reward for massive financial irresponsibility in the pursuit of gigantic profits (and gigantic bonuses for bankers).
On top of that the government has extended another line of credit to the banks of £54bn, making a total public donation of around £1200 for every person in the country.
New Labour is paralysed by the onset of economic crisis and has no idea of how to ameliorate the effects on the working class and the middle class that the new crisis – particularly harsh in the US and UK – entails. Financial speculators are making the inflation of food and oil prices much worse and the UK government could only make the incomes of ordinary people go further by progressive tax reforms and price controls. So what does it do? Imposes a regressive tax reform, abolishing the 10p in the pound rate for ultra-low paid workers, so it could give more money to better off workers and the middle class. To moral heartlessness is added political stupidity of heroic proportions. The successive attempts to rectify the situation only make the original decision look more harsh and incompetent.
New Labour lacks the wherewithal to get out of its present dire situation because to do so would mean a radical reversal of political direction that would involve a repudiation of all that New Labour stands for. Instead the New Labour tops are engaged in a fruitless and idiotic discussion about ‘presentation’ and the leadership and politically can only think of ‘deepening’ the pro-privatisation reforms and standing by authoritarian measures like the proposed 42-days detention without charge for terrorist suspect -, ie moving politically even further to the right.
To safeguard the living standards of workers today would mean imposing harsh controls on the banks and credit card repayments, a windfall tax on superprofits and super-bonuses, a sharply progressive income tax regime that expropriated wealth over £100,000 a year, price controls and massive increased tax on the supermarkets, the provision of affordable social housing, the withdrawal of British troops from Afghanistan and an end to the pro-privatisation reforms in health and education. On top of that the virtual pay freeze in the public sector would have to be ended. The chances of all that happening are nil.
New Labour has dragged British politics to the right, or rather maintained the right-wing trend initiated by the Thatcherites. Now the replacement of Brown by Miliband and a Tory victory in the next election seems inevitable. The Liberal Democrats have since the overthrow of Charles Kennedy as leader, moved significantly to the right and their new leader Nick Clegg has been unable to stem a loss of support by trying to look like Tory leader David Cameron. If you want to elect a Tory, why not the real thing?
New Labour has been responsible not only for a neoliberal economic agenda and the war, but also social authoritarian, repressive ‘anti-terrorist’ laws and pandering to racism in the immigration debate. Most of all however 28 years of Thatcherism and Blairism, and the consequent decline of the labour movement as a political and social factor in public life, not to mention cultural dumbing down, have contributed to a significant depoliticisation – especially, but not only, of the young.
Depoliticisation, anti-immigrant racism and the decline of the labour movement create a dangerous situation. Lefts alternatives to New Labour are weak and divided; the truth is the far right British National Party is making more gains than the alternative Left.
But the next general election will not be tomorrow. There is a breathing space to resume the fight on pay in the public sector, to remobilise against the fascists, to return to the fight for a viable left electoral alternative to Labour. That is all possible and urgent; but in the end it will be a new wave of workers struggles in defence of their basic interests that creates the basis for political alternatives.