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20 March 2019

How a second Thatcherite revolution could follow this Brexit crisis

Brexiteers want to repeat the reasons for Thatcher’s success.

By David Miliband

Britain’s political trauma is acute but its symptoms are not unique. Around the world the foundations of liberal societies are being shaken. Economic inequalities have become unsustainable. There is a backlash against social reform and representative democracy is under assault. Authoritarian regimes are on the march and liberal capitalism is in retreat.

Britain’s tragedy is that Brexit reflects these trends – and then supercharges them. Famed for pragmatic reform, creative solutions and global engagement, the country seems trapped between a past we cannot reclaim and a future we cannot imagine. The government is too divided to lead and the opposition too fearful to oppose.

The last time there was a comparable crisis of governability was in the 1970s. The three-day week, the IMF bailout and the “winter of discontent” saw the UK cast as “the sick man of Europe”. As a junior high school student in the US during the firefighters’ strike of 1977, I remember my social studies teacher Miss Fogg saying Britain was a “lost cause”.

She was wrong then, and it would be wrong to say the same today. But a crisis is only an opportunity if its true dimensions are recognised. In truth, Brexit is the anvil on which unresolved questions about economic, social and political reform are being decided. And if history is allowed to repeat itself, it will be the right and not the left that reaps the dividend.

The decision to hold a Brexit referendum reflected a crisis of confidence in the Conservative Party. It was spawned by paranoia over Ukip’s rise, but also by complacency about liberal democracy and the role of parliament in national life. I spent three years as foreign secretary quoting Clement Attlee and Margaret Thatcher on referendums as the refuge of dictators and demagogues. So it has proved.

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The Tory tragedy over Europe has been to be obsessed by it. One faction sees Europe as socialist. Another fears for British sovereignty. Together they have changed the course of the country.

Labour’s tragedy has been different. We are a Remain party that has been complacent about Europe with a leader who is sceptical about Europe. We have been forced back to old debates over whether the EU is a platform for progressive policy or a constraint on socialism in one country, neglecting the real debate about how a united Europe could forge a distinctive future in a world dominated by the US and China. This has produced endless oxymorons about “jobs-first” Brexits.

There is no Brexit that is good for jobs or families. Every reputable economic assessment of the past three years and the future has shown the opposite. The danger now is that the fundamental aim of the Brexiteers, a second Thatcherite revolution, follows this crisis, just as Thatcher herself followed the crisis of the 1970s. This is what should be at the forefront of progressive minds.

There were two essential reasons why Thatcher triumphed. She established a dominant diagnosis of the national ailment, rooted in the idea that the state was overloaded and ineffective, and she faced a mistrusted Labour Party. The ambition of the Brexiteers is to repeat the trick today. Michael Gove has been smart and strategic about this. The prize is to get out, because then everything is possible – and far from paving the way for a larger government role in the economy, the economic pressure will be in the opposite direction: for a free market race to the bottom.

I feel passionately about Brexit because it defines the national malaise and threatens to deepen it in a highly reactionary, regressive fashion. That some of the poorest constituencies in Britain voted for a course of action so damaging to their economic interests only adds pathos to injury. And if it is right that Brexit represents an acute crisis of liberalism, with economic, social and political components, then the response must address all three dimensions.

Social democrats have for the past 100 years played the critical role not just of civilising capitalism, but of making it sustainable by sharing its fruits more equally. That task is more necessary than ever.

Jake Sullivan, formerly Hillary Clinton’s policy chief, has written that the centre left cannot afford to be afraid of economic ideas deemed “radical”. If wage stagnation is a problem, and it is, then unionisation, retraining and wage subsidies need to be part of the answer. If rent-seeking at the top is a problem, and it is, then taxation of wealth and trust-busting of anti-competitive business practice need to be part of the solution.

However, the need for a new political economy on the centre left is only part of the challenge. It’s our home turf. Far tougher is the historic task of protecting, defending and renewing the social and political rights and responsibilities at the heart of liberal democracy. It is not alarmist to worry. Nearly two-thirds of the world’s countries, 116, have experienced declines in political freedom since 2006. In the US, voter suppression now appears the norm in Republican states. In Britain, we still lack a comprehensive investigation into alleged Russian funding of the Leave campaign.

Nationalism and nativism are no answer to the failings of globalisation – but we need a more robust response than evading difficult questions on issues such as ID cards. This is not only true in the sphere of domestic policy. As the US historian Robert Kagan recently wrote in the Washington Post, in an essay that should be compulsory reading for any concerned citizen of the West, Vladimir Putin’s assault on the West is rooted in an attack on liberalism in the name of social and cultural conservatism. It is actually the same argument as that of Donald Trump, Marine Le Pen and Nigel Farage.

Brexit is not the solution to Britain’s crisis – it is the accelerator of it. It is part of a malign and global deconstruction of a way of life we hold dear. We need to up our game to preserve that which is, or should be, precious. 

David Miliband is president and CEO of the International Rescue Committee and former secretary of state for foreign and Commonwealth affairs

Click here to read the rest of our “State of emergency” series, featuring articles from writers including David Hare, Elif Shafak, and Jonathan Coe.