The Real Economy

Gordon Brown on electability

Hector McNeill¹
SEEL

Gordon Brown gave a speech on Sunday, 16th August, 2015 which was revealing. It exposed, albeit in a re-packaged form, the New Marxist power principle that failed under Kinnock but which succeeded once Blair became leader. But it did not succeed for the reasons Brown suggests.

This is an important topic since it relates to the machinations of political parties to influence public choice including the macroeconomic policies to which the country is subjected.

Although Gordon Brown did not mention Jeremy Corbyn by name he must be aware that he himself would have been a Corbynesque figure if he had become leader risking failure at any general election.

The social perception of political parties and of what constitute appropriate economic policies, has recently shifted radically. This is the outcome of a complex and intense combination of austerity, the Scottish referendum, the liquidation of New Labour in Scotland by the SNP in the general election and the disastrous follow up to the question of powers to be devolved to the Scottish government. The result is a profound cynicism of the genuine objectives of the "main" British political parties whose status has hit rock bottom.

What people want of politics and of economic policies has changed radically in a very short space of time and neither the Labour nor Conservative parties has taken this on board. Because of new economic paradigms achieving objectives that were previously unachievable have now become feasible. Becoming involved in the process for change has therefore become inspiring because, at last, it is achievable. This is why the ideas and concepts involved are not considered to be a vain protest by those supporting them, but they are considered to be preferences whose time has come. Those who promote them could, indeed, be elected.

A more transparent and effective organization of public choice has become an imperative demanding that more consideration be given to the contribution of constitutional economics to Britain's future.

What Gordon Brown and many others, including those looking from the sidelines in the Conservative party, are not taking on board, is that the motivation for people to change the current unacceptable outcomes of macroeconomic "management" and to stem the more negative tendencies pervading the lives of an increasing proportion of the population, has become very strong. This is not fully appreciated because the Conservatives have become somewhat disarmed by their self-congratulatory flush of their recent election "victory" and, as in 1992, Labour have become self-obsessed with agonizing over the "shock" of failure to win the election. In both cases there is therefore no realization that the feasibility of achieving change demanded by the majority of the electorate has never been greater. There is, however, a need for courage to identify and articulate failures and to point to the alternative but feasible solutions.

Gordon Brown stated in a speech delivered on 16h August, 2015 that one can only deliver one's core values in government by being electable. He referred, as do many, to the re-election of Labour during the Blair years. However, those Labour governments gained their "majority" in Parliament with the support of just 19% of the electorate and they proceeded to "deliver" a range of actions against the wishes of the majority of the electorate. So just what does Gordon Brown now mean when he refers to the importance of being electable? The tactics deployed by both Blair and Brown designed to make Labour "electable" were not based on core values but were rather on a smoke screen designed get into power and remain in power at all costs. They succeeded in 1997 and the tactics deployed have been described in the book, "The Briton's Quest for Freedom -Our unfinished journey...". For the record I reproduce below the relevant sections of this book and have added the relevant footnotes which were indicated within the text of the book in parentheses. In terms of electability note 57 refers to the reality of Gordon Brown's "electability".

The new paradigms

There are now two new paradigms. One is the rejection of the electorate of the dog whistle politics of the main political parties who are so cynical about their "values" that they abandon major parts of their manifestos simply to stay in power, naturally "for the good of the nation" (Conservatives and Liberal Democrats) or base their campaigns on fear mongering and change their values according to the direction of the wind (Conservatives stating the SNP would control Labour and the general abandonment of green issues) or support unreasonable policies (such as Labour supporting austerity). The other is the macroeconomic policies supported by a coherent theory and policy instruments, as presented in the alternative Real Incomes Approach to economics.

The first paradigm shift makes the political party led by someone who articulates what people feel and need, no matter how embarrassing, more electable. This has less to do with values and more to do with justice in cleaning up the economic inequitable fiasco managed by our major political parties. Electability rests solely in the conviction of people that propositions will address what is currently of importance to the majority in a way that responds to the specific preferences of our diverse social and economic constituencies.

Selected excerpts from: McNeill, H.W., "The Briton's Quest for Freedom - Our unfinished journey...'", HPC, 418 pp, 2007. ISBN: 978-0-907833-01-7.

1. The Phony Social Revolutions
Pages 127-128

Important shifts in socialist outlook were championed by Hugh Gaitskell the Labour party leader and Anthony Crosland a Labour MP. In 1959 Gaitskell had attempted to change party policy on nationalization (Clause IV). The intellectual justification for his stand was to be found in work by Anthony Crosland in his book, "The Future of Socialism" published in 1956. Here he argued that there was no need for nationalization because the actual power resided in the management of economic activities and not in the hands of the owners and the state could influence sector activities sufficiently well. This particular observation was to become the central justification for reducing the force and significance of Clause IV. Crosland is reported to have observed that capitalism seemed to have solved the problem of coming up with adequate per capita incomes for the workers. Crosland's observations can be traced back to meetings of the Congress for Cultural freedom (CCF), launched in 1950 in Berlin and headed by Melvin Lasky (51). The general drift of Crosland's book's content had been discussed at a Milan CCF conference attended by Hugh Gaitskell, Denis Healey, Rita Hinden and Daniel Bell the author of a book in the same vein entitled, "The End of Ideology". Hugh Gaitskell died in 1963 under suspicious circumstances after becoming ill during a visit to the Soviet Union and Anthony Crosland died following a stroke in 1977 at the age of 58. There are sound arguments for considering Anthony Crosland to have laid much of the intellectual foundation for what was to be picked up, some 20 years later, as new Labour policy.

The Power Strategy
Pages 134-135

The far left strategists never seemed to perceive the family-based reasons for their difficulties in increasing their levels of support. The far left, those favouring the continued "class struggle" and state control over the means of production, began to review their options. Like Stalin in post-war Russia, leaders in all communist countries had long since abandoned any pretence at supporting a class struggle. Socialism had become a buzzword cynically applied by a single political party as the justification of its dominance of the economy and lives of the people and, of course, keeping the party bosses in a state of good living. The name of the game was to keep the political party in power; almost at any cost.

Neil Kinnock, the leader of the Labour party, decided that the challenge facing the party was how to gain and remain in power. With the collaboration of the New Marxist movement, Neil Kinnock developed a radical change in approach for the Labour party. This was to substitute the former political philosophy referred to as socialism and the ideological basis associated with the so-called class struggle with a strategy to change the party image by appealing directly to consumerism and identity concepts (54). This new approach has been referred to as the power strategy (55).

Kinnock had already introduced the power strategy in the general elections of 1987 and 1992, but in the popular mind, Labour was, largely as a result of the miners' strikes, associated with extremism. Tony Benn of the left mounted a leadership challenge to Neil Kinnock in 1988 but Kinnock survived. This served to demonstrate how far the marginalisation of the left had progressed within the Labour party.

For the 1992 election, Kinnock had applied a more professional public relations front aided by Peter Mandelson. What did become evident was that the lack of reference to strong political dogma and ideals by the new Labour party succeeded in taking the wind out of the sails of the Conservative party campaigns. The Conservatives appeared to be old style politics with a strong philosophical undertone. Labour came across more as a rational management team relatively free of political dogma. As a result, the election result improved for Labour but the continuing popularity of the Conservative party still won the day. In spite of Neil Kinnock's effective revolution within the Labour party he seemed to be, as a party leader, unelectable.

Proof of concept acted out in Central Europe
Page 134

The presence and direct influence of the New Marxist movement on the Labour party seemed to wither in the UK with the initial false starts for the power strategy with two election failures. However their influence and ideas seemed to gain ground in Europe. Indeed, the first practical demonstration of the success of the power strategy occurred in the early 1990s in Central Europe. East and Central European Marxist politicians in ex-Russian satellites, with little sympathy for participatory democracy, were able, on the basis of public relations exercises of simply renaming their parties and to switch their identity from being that of totalitarians to that of being free marketeers and democrats. Such politicians did not change their fundamental political outlooks they simply did what was necessary to stay in power. They succeeded in being elected as democratic governments and the salvation of those whom they had oppressed just days before. This process was associated with effective press censorship as a result of several leading politicians having a particular tendency to sue journalists who published truthful statements concerning their past. Many journalists ended up in prison; to be expected when police chiefs and judges have their jobs as a result of political party patronage.

New Labour & the power strategy
Pages 135-138

Following the unexpected 1992 election defeat, John Smith became the new leader of the Labour party. The Labour party agonized over the reasons for their defeat in 1992. Labour had not completely shaken the image of being in favour of strong centralized state control and ownership of means of production. One of the persistent issues raised by the Conservatives seemed to affect some voters, this was the view that a Labour government would cause a flight of foreign investment and scare away new British private investment. There was a need to produce an image of being more responsive to private business concerns. Tony Blair worked to water down the text of Clause IV to extinguish the commitment by the Labour party to the ownership of the means of production (49). Behind the scenes the arguments to dilute or remove Clause IV were simple and pure power strategy talk founded on the need to gain and stay in power. The repeated question was, "do you want another decade of Conservative rule?" Anthony Crosland's arguments that power rested in the hands of the managers of industry and not the owners became a basis for the Labour party saying to the unions and those supporting Clause IV, "trust us we can achieve the same control through centralized government policies." The Labour party's "Clause IV moment", as it came to be known, was therefore far less of a trauma than many outside the Labour party realized; the media exaggerated the extent of the "struggle".

Gordon Brown began a disciplined process of reshaping the economic policy agenda within the party. He did this by introducing a pro-forma budgetary approach (56) to purposely reduce the size of the apparent "visible" public spending plans of his shadow cabinet colleagues. This also initiated a process where he began to control the whole economic agenda of the party, and indirectly the relative scope and effectiveness of policies in most of the other portfolios. These activities were complemented by occasional meetings with financial and business leaders in the City of London. This helped Labour's proposals for governance to appear to be more prudent and more in line with an image of being less orientated to centralization and to be more business-friendly.

In 1994 John Smith died. Initially there had been a general feeling that Gordon Brown would be the next leader of the Labour party but a colleague, Tony Blair, who had been rising rapidly through the party, decided to run for leader. Brown and Blair had both been first elected in 1983 and in broad terms were identified with slightly different natural groupings within the party. An election contest between Brown and Blair would therefore have risked the possibility of a significant split within the party and potentially the destruction of Neil Kinnock's investment in preparing the foundation for New Labour. As a result it would seem that there was an agreement (57) to avoid this possibility with Tony Blair becoming the only leadership contender of the pair. Tony Blair became the leader of the party.

Following the impressive demonstration of the feasibility of the power strategy in Central Europe, the first real test in the United Kingdom occurred during the 1997 general election. This took up the legacy of Kinnock's work and orientation but under Tony Blair. Although not a political philosophy or approach to governance invented by Tony Blair it has been dubbed "Blairism" with Tony Blair taking full advantage of the broad concept to gain power and to ride out his own brand of leadership. The New Labour support Blair enjoyed within the party was essentially founded on Kinnock's former efforts. Very much aware of the importance of the public relations dimension of New Labour, Blair consolidated his anti-left credentials by pressuring within the party to marginalize the so-called old Labour left. On the other hand he kept one or two individuals who he perceived to be "safe" within the shadow cabinet, such as Clare Short and Jack Straw, so as to keep the broad party left contingent in line. New Labour won the 1997 general election.

Notes from the original text:

51 - ref: "How the CIA Took the Teeth Out of Socialism", Fletcher, R., WCM Library, wa.

54 - ref: The New Marxists & Kinnock. New Marxists and Kinnock - Ann Talbot, "UK Foreign Secretary Jack Straw rants against Trotskyism", International Committee on the 4th International, 29 November 2004, WSWS.

55 - ref: The Power strategy. Power strategy - McNeill, H.W., "The rise & fall of Power Politics - Part 1", Real News, October 2006, APE, wa.

56. - ex: The pro-forma budgetary approach. The pro-forma budgetary approach declares a budgetary figure of cost which for observers seems to set a limit on the budget. However, there are no conditions set on the pro-forma budget. Those reading such budgetary figures would tend to assume that budgetary figures are fixed but since there is no accompany statement limiting upward revision the approach can mislead. Upward or downward revisions of budgets can result from internal party policy or from the performance of the raising of revenue as a function of the movement of the economy as a whole. During the last decade the upward revisions related to economic expansion have been the most obvious sources for boosting policy programmes with extra cash.

57 - ex: Blair or Brown for leader? The dilemma facing Neil Kinnock's allies in deciding if Gordon Brown or Tony Blair should run in the Labour party leadership contest only had one rational option.

As a graduate in history Gordon Brown naturally has a good sense of history but in particular that of the Labour party. Part of his Ph.D. work as Edinburgh University was a study of James Maxton the Clydeside politician who exemplifies the Labour party's roots in Scotland and the Red Clyde. This was not so much a natural growth of the issues of an "industrial heartland" phenomenon but involved many complex strands of motivation arising from a large contingent of Post World War 1 veterans, as well as a vital body of support from the local Irish who began to focus their attention, less on Irish questions but on those in Clydeside and Britain. The issue about someone who "understands" an issue in depth is that they will be perceived to be "sympathetic" or at least "appreciative" of the cause and the values of those of the left. Tony Blair as a solicitor and then barrister could never quite demonstrate Brown's socialist pedigree but was a fast climbing politician to whom Neil Kinnock had given shadow spokesman rank within a year of his being elected; Brown gaining this status a year later.

The issue facing the Labour party in contemplating a leadership contest between Blair and Brown was that Blair would not receive any support from the left wing of the party (about 25% of the parliamentary group) and might receive the support of a well identified group of Kinnock enthusiasts which in fact were on the wane, of around 50% of the parliamentary party. In the middle was a critical group of possible waverers making up around 25% of the parliamentary party. On the other hand, there was no doubt that Brown would have received a broad support from the left (25%), if for no other reason that he was someone who understood their values. Also, given Brown's record on Treasury matters, he was generally popular with the centre of the party, those who in terms of Blair, were waverers (25%) and there is little doubt that he would have receive about half of the pro-Kinnock contingent (20%). Therefore, if this contest had gone ahead it is likely that Brown would have won convincingly (at least by 55:45). The problem was that this would have created a considerable obligation on the winner, Brown, to respond to the left's support in some manner. This would have risked undoing much of Kinnock's work to isolate the left as well as ongoing work unpopular with the left. The only way to avoid this was for Brown not to run.

The tactical decision was therefore taken to ensure that Blair, as the torch carrier of the yet-to-be-named "New Labour" project won by organising a leadership contest with no effective opposition. Accordingly, Blair ran against "stand ins" who had absolutely no chance of winning. These were John Prescott and Margaret Beckett, who were provided with prominent positions in subsequent governments by Blair.

The results of the leadership totals expressed in percentage terms were predictably as follows:

Candidate	Affiliated	Constituencies	PLP	Total
Tony Blair	52.3	58.2	60.5	57.0
John Prescott	28.4	24.4	19.6	24.1
Margaret Beckett	19.3	17.4	19.9	18.9

It was widely reported in the media that there was a Brown/Blair pact associated with this agreement sealed in the Granita restaurant but party sources deny any knowledge of this allegation.

¹ Hector McNeill is director of SEEL-Systems Engineering Economic Lab.