Mike Phipps reviews Futures of socialism: ‘Modernisation’, the Labour Party and the British Left, 1973-97, by Colm Murphy, published by Cambridge University Press.

Was the polarisation of the Labour Party in the 1980s and 1990s inevitable? A recent article on Labour Hub discussed this question and this thoughtful new book opens on a similar theme.

The left-right divide at the time was not always clearcut, suggests Colm Murphy.  In the late 1980s, veteran left wing MP Michael Meacher put himself firmly in the camp of Labour’s modernisers, criticising the political basis of Tony Benn’s bid to replace Neil Kinnock as Labour leader after the Party’s third successive election defeat in 1987. Yet Meacher’s own attempts to update Labour’s traditional socialist message, while still retaining its radical core, did not chime with the rise of the emergent New Labour modernisers who aimed to replace democratic socialist beliefs with something wholly alien.

Except that Colm Murphy does not see New Labour’s modernisation as alien, rather as something that grew out of the left as a creative response to Thatcherism. It wasn’t just Blair and Brown and their followers who championed modernisation, he points out, or even Meacher: Ken Livingstone, Stuart Holland, the magazines Marxism Today and New Socialist and many others emphasised it.

On this he’s right: the debate on modernisation was broader than is often recognised. It encompassed industrial democracy, municipal activism, championed by Greater London Council Leader Ken Livingstone and Sheffield City Council Leader David Blunkett, environmentalism and the politics of gender.

Most of these ideas hit a brick wall, with the leadership’s accelerating move to the right in the 1990s. The campaign to make Labour more appealing to Black people, which focused on the right to form Black Sections, was marginalised even earlier, as Murphy acknowledges.

So was the movement to modernise Labour’s policies and outlook the pluralist process Murphy claims, or a Trojan Horse to subvert Labour’s core principles?

In fact, both these ideas can be true. The recognition of the need to modernise the Labour Party’s ideas, especially after its 1983 general election debacle, was widespread, just as it was at the time of Harold Wilson’s rise in the early 1960s. But the particular form of modernisation that ultimately took hold was both a centralisation of power around the leaderships of Neil Kinnock and later Tony Blair, and a wholesale jettisoning of fundamentals in their accommodation with neoliberal ideas. Not for nothing did Margaret Thatcher claim the rise of New Labour was her greatest achievement.

The erosion of Britain’s economic sovereignty, by rising globalisation especially, was a major preoccupation of both radicals and moderates in the Labour Party. This was given new emphasis by the economic challenges faced by the Mitterrand government in France after 1981. For the modernising left, this necessitated new thinking about how to pursue an independent economic policy. For so-called moderates, however, it meant no such policy could be pursued at all in the face of seemingly unassailable market forces.

The ascendance of this latter group was neither inevitable, nor due simply to the supposed superiority of their economic ideas on an intellectual level. It can be attributed to a range of other factors, including the major defeats suffered by the workers movement in the Thatcher years, the electoral pessimism that grew from Labour’s repeated defeats at the ballot box and the centralisation and administrative silencing of left voices that took place within the Party during Neil Kinnock’s leadership.

The result was not merely a surrender to the supposed inevitability of globalisation, but a consciously chosen embrace of the idea, in Peter Mandelson’s words, that “we are intensely relaxed about people getting filthy rich”. This was all the more shocking, given the new punitive social conservatism his wing of the Party was about to champion, in relation to benefit cuts, tougher criminal justice policies and a harsher regime for migrants.

Murphy not only rejects what he believes is the dominant narrative about Labour’s modernisation: he also argues it is wrong to see New Labour in office as a simple manifestation of neoliberalism. Of course, it’s true that there was opposition to Blair’s privatisation of essential public services, trickle-down economics and low tax and free market outlook. This included at times Gordon Brown, who oversaw these macroeconomic policies, but sometimes resisted Blair’s interference in his Treasury responsibilities, usually out of opportunistic or career-oriented motives.

But judging the New Labour experiment by its accomplishments in office – especially its failure to tackle systemic inequality and the ease with which its modest reforms could be torched by the Conservative-led austerity government which succeeded it – leaves little doubt as to its neoliberal character, at least regarding its economic record, which was its most important legacy.

Beyond that, there were significant achievements, especially on constitutional reform. The conversion to regional devolution was indeed part of a broader discussion within the Party around modernisation – although, even here, Blair’s position in the debate was instinctively conservative, comparing in early 1997 the powers of a future devolved Scottish parliament to those of a parish council.

Labour’s other constitutional reforms, from electoral reform at the margins to the Human Rights Act and Freedom of Information, were largely borrowed from the Liberal Democrats – and then diluted some. It’s true, as Murphy says, these reforms weren’t neoliberal, but there weren’t Keynesian either. They were a substantial package, which looked all the more impressive because New Labour in office was too timid to enact meaningful socioeconomic reforms. But it seems  bit odd to cite these constitutional measures as evidence that the New Labour years were not dominated by a neoliberal mindset.

One only needs to look at the immediate priorities of Tony Blair’s government after taking office in 1997. Within hours, it gave independence to the Bank of England to set interest rates, a clear commitment to neoliberal orthodoxy.

The government then decided, under no particular compulsion, to accept the spending targets set by the outgoing Conservative administration. This meant cuts to NHS funding in real terms. Corporation tax cuts meant big business enjoyed the lightest taxation in Europe.

Welfare reform was another priority. Lone parent and other benefits were cut. A proposal for university tuition fees, rejected by John Major’s Tory government, was back on the table. A White Paper on trade union rights, a major dilution of earlier promises, left Britian with “the most lightly regulated labour market of any leading economy in the world,” Blair boasted.  

None of these measures were forced on the government by a financial crisis: they were political choices. “The people Blair wants most desperately to please are those who have amassed great wealth and power,” suggested a Labour Left Briefing editorial in December 1997. “Ideologically he is committed to neo-liberalism, as a consequence of which he identifies the ‘national interest’  with the interests of big business.” And all this was just in the first year of the New Labour government!

Overall, there is a lot to engage with in this book. By unearthing the theoretical contributions of many socialists to Labour’s economic debates in the 1980s and 1990s, Murphy has helped dispel the myth that the left were simply dinosaurs, unable to respond to the major economic and social changes taking place at this time. In any case, this was always a caricature peddled by their right wing detractors. That said, there is still much to disagree with in his assessment of the rationale of New Labour and what they achieved in office.

Mike Phipps’ book Don’t Stop Thinking About Tomorrow: The Labour Party after Jeremy Corbyn (OR Books, 2022) can be ordered here.