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9 October 2023

Labour can’t prop up a crumbling settlement

In this moment of flux we need agile thinkers and campaigners to ensure what emerges is egalitarian and democratic.

By Neal Lawson

I spent a large chunk of the fading summer reading England’s Dreaming, Jon Savage’s thrilling account of the rise and fall of the Sex Pistols in the mid-1970s. Punk was the cultural expression of a moment of incredible flux between a postwar settlement that was faltering fast and a looming but not yet apparent free-market era. In what Antonio Gramsci termed the interregnum, between the old dying and the new being born, morbid symptoms would appear. Punk employed the twisted aesthetic of the swastika alongside the noble ethic of anarchism. In a world where security was still social, bands could thrive through the creative energy of public art colleges, unconditional dole payments, and police who turned a blind eye to central London squats.

But the security offered by the welfare settlement was in retreat. Britain, the US and eventually most of the world, not least the rusting Soviet Union, would eventually succumb to the nostrums of the new right. The DIY, and therefore egalitarian, culture of punk was subordinated to its dictum of cash from chaos, in which the cash trumped the chaos. In hindsight we can see the shift taking place: from an industrial to a post-industrial society; from a world in which we were defined by what we produced to what we consumed; from a democratic and negotiated settlement between labour and capital to the dominant idea that markets, not people, ruled the world.

The mid-1970s were a dramatic turning point. Almost half a century on, we are approaching another fork in the road. What are we turning from and how do we make it a progressive turn?

There have been two dominant settlements in the UK’s postwar existence. The first we can call the “machine settlement”, based as it was on the Fordist system of car production, which lent its clockwork-like methods to government, public service and the military. The rhythms of benign hierarchy, paternalism, and command and control became ubiquitous for three decades. It was secure but eventually stifling.

The second we can call the “market settlement”, based as it was on the idea that free markets more efficiently allocated resources than centralised planning. Choice now trumped control, and the private came before the public. All this justified gross inequality. This system has ruled our lives for over 40 years, but nothing lasts forever.

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New settlements arise when emerging technologies, cultures and social forces run up against the limitations and paradoxes of the existing and dominant settlement. A battle for supremacy then ensues. The machine settlement collapsed in part because technology was dispersing power and choice, while globalising the decisions once made at the national level. Critically, deference was being replaced by the urge for greater individual freedom of expression. The 1960s desire for liberty in fashion, music and sexuality opened the door to economic freedoms.

But today this market settlement is itself breaking down. At a very basic level, the underlying promise of free markets to deliver an unending conveyor belt of consumer baubles to those lucky or hard working enough to afford them is turning to dust. The cost-of-living crisis has halted social reproduction via ever happier shoppers. The shock waves of the 2008 crash still reverberate and the drive for infinite economic growth on a finite planet mean this settlement has been found wanting evidentially and morally.

[See also: The progressive dilemma]

Something new will eventually emerge from this breakdown, but new doesn’t guarantee better. The right might be incompetent, but they aren’t stupid. They know a counter-revolution is brewing and are seeking to head it off with a mix of populism, telling people who to follow and who to hate, alongside an authoritarian crackdown on protest and dissent.

This is the moment Keir Starmer’s Labour is stepping into, a moment of flux in which climate, AI, searing inequality and geopolitical upheaval are the multiple fault lines for dramatic change. But Labour is operating as if it is in a version of 1964, when it squeaked into power and won a large majority at a second election in 1966. But the reality is much more akin to 1974, when two elections in a year failed to resolve the deep social and political tensions between old and emerging settlements and the forces they represented. Eventually Thatcherism swept all before it. Even big parliamentary majorities cannot obstruct change, as Boris Johnson painfully discovered.

Yet for fear of damaging its poll lead, Labour keeps its head in the sand, offering only the smallest policy target to attack, all at the cost of a truly progressive mandate and settlement. But reality will eventually bite. And when it does the wisdom of Milton Friedman kicks in: “Only a crisis – actual or perceived – produces real change. When that crisis occurs, the actions that are taken depend on the ideas that are lying around.”

Going back to the middle years of that wonderfully creative but ultimately dark decade, it is important to recall that other futures were possible. Ideas around an alternative economic strategy were starting to flourish, Britain still had a powerful trade union movement, and there was a vibrant counterculture based around feminism, peace and anti-racism. Ultimately, however, the leadership, ideas, culture and organisation of the right decisively tipped the balance their way.

The task of progressive forces, academics, thinkers, campaigners, purpose-led businesses and people of all parties and none is to build the leadership, the organisation and the culture of a politics that has the agility, determination and influence to ensure that the next settlement is as green as it is egalitarian and radically democratic. The hope, as Pablo Neruda wrote, is that “you can cut all the flowers, but you cannot stop spring from coming”.

This is an extract from “The New Settlement”, published by Compass

[See also: Sharon Graham: “Labour is too cautious. It has been immobilised”]

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