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Corbynism 2.0: the radical ideas shaping Labour’s future

After fighting the 2017 election on policies from its social democratic past, the party is now embracing a more transformative agenda: worker ownership, universal basic income and a four-day week.

 

On the wall of Preston council leader Matthew Brown’s office is an “Anarchy in the UK” Sex Pistols poster. Having once been a byword for economic stagnation (a planned £700m redevelopment of the city centre collapsed in 2011), the Labour-run Lancashire authority has embraced radicalism. Rather than chasing inward investment from large multinationals, as it previously had, the city council forged an alternative growth model. It championed worker-owned co-operatives, persuaded public sector bodies to “insource” services, became the first living wage employer in the north, founded a not-for-profit energy firm and established a credit union to combat avaricious payday lenders.

“We needed to do something that was more resilient but also, crucially, put more democracy and ownership in the Preston economy,” Brown told me when we met one recent morning. The councillor, who identifies with Labour’s Bennite left tradition, observed: “One of the reasons that Thatcher found it so easy to privatise a lot of the public assets was that working people didn’t have a huge amount of affinity with them. If they had been on the board, sharing the profits and had a real ownership stake then she wouldn’t have been able to do it, they would have been hugely popular.”

When John McDonnell, the shadow chancellor, visited Preston in 2016 he declared: “This kind of radicalism is exactly what we need across the whole country.” The following year, Jeremy Corbyn praised the city’s “inspiring innovation”.

Labour may not be in power but it is already reshaping Britain.

Corbyn has now led Labour for three years. Never before has the party’s left enjoyed such power. The Marxist Social Democratic Federation, the Socialist League of the 1930s, the Bevanites of the 1950s and the Bennites of the 1980s were all divided or defeated. Having previously been consigned to internal exile, Corbyn and his allies control Labour’s commanding heights.

They have won two landslide leadership victories, more than doubled the party’s membership to 540,000 and delivered the biggest increase in its general election vote share since 1945 (from 30.4 per cent to 40 per cent in 2017). These advances are still more notable when set against the decline – or “Pasokification” (a reference to Greece’s vanquished Pasok) – of the European centre left. In Germany, France, Italy, Austria, the Czech Republic, the Netherlands and, most recently, Sweden, social democrats have endured their worst results in postwar history. Labour, by means of an internal revolution, has averted this fate.

Yet among Corbynites, the exuberance that followed the 2017 election has given way to unease. It is not merely that the opinion polls are too tight for the party to be confident of winning power, or that the party’s summer was consumed by the anti-Semitism crisis. In the view of many on the left, Labour is failing to take full advantage of the historic opportunity before it.

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Whenever the Labour Party has won landmark election victories it has done so by having a compelling vision of the future. After the Second World War, in 1945, Clement Attlee promised a “home fit for heroes” and vowed “never again” to return to the poverty and mass unemployment of the Great Depression. In the 1960s, Harold Wilson harnessed the “white heat” of technology against the grouse moor politics of Alec Douglas-Home. In 1997, Tony Blair spoke of a “new, young country” and swept away John Major’s Conservatives.

In a speech on 21 January 2016, John McDonnell, the shadow chancellor, observed: “The charity Nesta published a fascinating piece of research recently, showing how ‘future-focused’ the different party manifestos were in last year’s election [2015]. The Tories talked relentlessly, overwhelmingly about the future. Labour, strikingly, did not. We cannot allow that to happen again. We cannot be small ‘c’ conservatives.”

But one of the charges most frequently levelled against Corbynism is that it merely represents the politics of nostalgia. Rather than shaping the future, critics say, it wishes to resurrect a discredited pre-Thatcherite corporatist past.

Ever since the collapse of the Soviet Union and the triumph of neoliberalism, the left has struggled to articulate an alternative. The Marxist theorist Fredric Jameson observed in 1994 that “it is easier to imagine the end of the world than to imagine the end of capitalism”. After the financial crisis, it was the austerian right, rather than the socialist left, that initially benefited.

In recent years, however, the left has rediscovered the politics of futurism. Books such as Paul Mason’s PostCapitalism, Nick Srnicek and Alex Williams’s Inventing the Future, Rutger Bregman’s Utopia for Realists and Peter Frase’s Four Futures argue that technological advancements could render much work unnecessary and liberate humans – sustained by a state-funded universal basic income (UBI) – to pursue a new kind of freedom. Aaron Bastani’s forthcoming Fully Automated Luxury Communism (January 2019) will occupy similar terrain: “What if, rather than having no sense of the future, history hadn’t really begun?” But Labour’s swiftly assembled 2017 manifesto, For the Many, Not the Few, was largely unreflective of such thought. It made no mention of UBI, automation or a shorter working week. Though the manifesto’s headline proposals – the renationalisation of water, energy and rail services, the abolition of university tuition fees and higher taxes on top earners and corporations – were overwhelmingly popular, they were redolent of postwar social democracy.

The document revered by Labour radicals is, in fact, Alternative Models of Ownership, a report published to little attention on 6 June 2017, two days before the general election. It called for “rapid automation”, “new models of collective, democratic ownership” to ensure the benefits of technology are shared, “a shorter working week to fairly share productivity gains” and “potentially in time a universal basic income to supplement labour market income”.

The report, commissioned by Labour’s economic team, is now shaping its next manifesto, which McDonnell has promised will be “more radical than the last”. On 31 July, the shadow chancellor backed a trial of UBI (which is already being piloted in Scotland by Glasgow and Fife councils).

The idea of a basic income has existed since Thomas More’s Utopia (1516) in which the fictional Portuguese traveller Raphael Hythloday argues that it would be a better means of tackling theft than sentencing thieves to death. “It would be far more to the point to provide everyone with some means of livelihood, so that nobody’s under the frightful necessity of becoming, first a thief, and then a corpse.”

UBI was later advocated by left radicals, such as Thomas Paine, on egalitarian grounds and by right libertarians, such as Milton Friedman, on anti-bureaucratic ones (the welfare state, he reasoned, could be largely abolished). Its resurgence – experiments in Kenya, Finland, Canada and the Netherlands – reflects the consequences of greater automation (the Bank of England has estimated that two-thirds of UK jobs could be eliminated in the next two decades) and the increasingly precarious, low-paid nature of 21st-century work. “Since 2006, there has been a 60 per cent increase in the number of people moving in and out of unemployment,” noted Will Stronge, the director of the think tank Autonomy.

From a left radical perspective, UBI destigmatises welfare by establishing a universal payment, and partially decommodifies labour by separating income from work. Employees, who are increasingly prodded by governments to accept any job on offer, would have their bargaining power strengthened. Work would be judged according to its desirability, rather than its necessity.

The principal objection to UBI is its cost – potentially hundreds of billions – and the tax rises that would be required to fund it. For this reason, some instead advocate a universal basic dividend (UBD). Yanis Varoufakis, the former Greek finance minister, told me: “Increasingly people recognise, even those who are not Marxists, that capital is being produced collectively. I always give the example of Google: the large majority of Google’s capital is produced by users – every time you search you are adding to the capital stock of Google.

“Nevertheless, the profits are then privatised by the shareholders, while you get nothing back… Every time capital is being raised on the stock exchange, a percentage of the shares should go into a public wealth fund.”

In Alaska, since 1982, a state-owned fund, which collects oil and mineral revenue, has paid every resident an annual dividend (estimated in 2018 at $2,700 per head but reduced by legislators to $1,600). During her 2016 presidential campaign, Hillary Clinton contemplated a national version of this scheme but, to her later regret, concluded that it was unworkable. “I wonder now whether we should have thrown caution to the wind and embraced ‘Alaska for America’ as a long-term goal,” she wrote in her memoir.

A credible left should embrace what one could call incremental utopianism: progressive reforms situated within a radical framework. Alex Williams, the co-author of Inventing the Future (one of the defining texts of Corbynism), told me that the next Labour manifesto should promise a four-day working week. “It aligns with the history of the labour movement. Until the 1930s, cutting working hours was a key demand as well as increasing wages.”

Between 1900 and the Great Depression, the average Western working week was reduced from 60 hours to below 35. In his much-discussed 1930 essay “Economic Possibilities for Our Grandchildren”, John Maynard Keynes prophesied a 15-hour week and concluded that man’s chief concern would be “how to occupy the leisure, which science and compound interest will have won for him, to live wisely and agreeably and well”.

But in the postwar corporatist era, after the experience of mass unemployment, governments and businesses united to revere labour. Nearly 90 years after Keynes’s essay, Britons work an average of 42.3 hours a week, the highest level in the EU (the lowest – 37.8 hours – is in Denmark). Productivity (output per hour), however, is 13 per cent below the G7 average.

Overwork, leading to illness and absenteeism, and low investment (among the worst in the G7) are the origins of the new “British disease”. Since 2010, a Conservative administration committed to austerity has made little use of historic low interest rates and the cheap money available to alleviate this curse. Labour, by contrast, has pledged to invest at least £500bn over the next decade, comprised of £250bn of government borrowing (which would match the OECD average) and £100bn of funding for a National Investment Bank, which would raise a further £150bn from the private sector.

Increased investment in technology, as well as a higher minimum wage to raise the cost of labour, would accelerate automation and make a four-day week conceivable. A recent trial by the New Zealand trust manager Perpetual Guardian proved so successful – higher productivity, reduced stress – that the firm is considering making it permanent. On 10 September, Frances O’Grady, the general secretary of the Trades Union Congress (TUC), declared that “in this century we can win a four-day working week”. More than 1.4 million people work seven days a week, with 3.3 million working more than 45 hours a week, a TUC study found.

“The classic social democratic demand for full employment should be replaced with the future-oriented demand for full unemployment,” declares Inventing the Future. A party named Labour, which is heavily funded by trade unions, is unlikely to inscribe this slogan on its banner. But the left is resurrecting one of the classic socialist critiques of capitalism: that it makes humans unfree.

Karl Marx, who wrote in Capital: Volume III of a “realm of freedom” in which labour “determined by necessity and mundane considerations ceases”, suggested that in a communist society, “where nobody has one exclusive sphere of activity”, one could “hunt in the morning, fish in the afternoon, rear cattle in the evening, criticise after dinner” without “ever becoming hunter, fisherman, herdsman or critic”. When Corbyn spoke in his 2017 Labour conference speech of how technological advances could enable “a new settlement between work and leisure” and “expanded creativity”, he was implicitly referencing this tradition.

Faced with the technocratic mundanity of Brexit, and a parliament that may endure until 2022, Corbynism 2.0 can appear a distant dream. But in some corners of Britain it is already happening.

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Rather than lowering his sights, Preston council leader Matthew Brown is raising them. He aims to establish a Lancashire-wide community bank to provide loans to small businesses, and Preston is pioneering the use of drone technology in public services and urban construction. The city exemplifies what Neil McInroy, the head of the Centre for Local Economic Strategies, calls the “new municipalism”. Rather than a narrow commitment to the state, this model encourages a plurality of forms: co-operatives, mutuals and trusts, as well as government ownership. In Spain, the Mondragon Corporation, the world’s largest worker-owned co-operative, encompasses 260 individual co-ops, employs 75,000 people and has annual revenues of more than €12bn.

McInroy told me: “If you go to Barcelona and speak to the mayor [Ada Colau], she would say politics is an agora, not a temple. Politics is something that takes place in an open public space, not something that takes place in a town hall.” (McDonnell’s economic advisers are animated by the city’s bid to democratise the use and control of private data through the Decode project.)

Preston can invite critics to judge it by its results. Before 2013, major public bodies, such as the University of Central Lancashire and Lancashire Constabulary, had a combined annual budget of £1bn, but startlingly little of this money was spent locally. Inspired by the “Mondragon model” in the Basque Country and the “Cleveland model” in the US, Brown’s team persuaded six of these “anchor institutions” to procure more goods and services from Preston-based firms (such as local builders, printers and farmers), rather than relying on outsourcing companies often headquartered in London.

Since then, the share of the public procurement budget spent in the city has risen from 5 per cent in 2013 to 18 per cent (a gain of £75m), while across Lancashire it has risen from 39 per cent to 79 per cent (a gain of £200m). A not-for-profit energy firm, Fairerpower Red Rose, has saved consumers more than £2m.

“There are lots of critiques emerging saying this is a form of protectionism,” Brown acknowledged. “But they are very easy to deal with because we’ve got social value and European regulations. If there’s a much better bid on price, quality, social value from outside it would have to go to that outside supplier.”

In February, McDonnell established a Community Wealth Building Unit to export the Preston model to other areas of the UK. On 9 September, he announced that Labour would require all private companies employing more than 250 people to establisher worker “ownership funds”. Like Brown, McDonnell recognises the flaws of past nationalised industries, characterised by a management he described as “often too distant, too bureaucratic and too removed from the reality of those at the forefront of delivering services”.

Rather than the mere nationalisation of utilities, Labour wants to achieve their democratisation. “To me, that is the socialist message going back to the 19th century,” the Corbynite thinker Jeremy Gilbert, professor of cultural and political theory at the University of East London, told me. “In the end, no one is going to do it for you: kings, bosses and bureaucrats will all claim that they’ll sort everything out for you but they won’t. Only by creating institutions through which we can sort things out for ourselves will we actually deliver the outcomes we really want.”

The scale of the political challenges confronting the Corbynites is daunting. They must navigate Brexit, which divides Labour voters and MPs. The European question pits two Bennite principles – Euroscepticism and activist power – against one another. Polling has consistently shown that Labour members, in contrast to Corbyn, favour Britain staying in the single market and holding a second Brexit referendum. A potential “new centrist party” need only depress Labour’s support by a few points to gift victory to the Conservatives at the next election.

Though overwhelmingly supported by the party membership, Corbyn has no more than 20 committed ideological followers among the parliamentary party. The project is heavily reliant on hard-working and trusted media performers such as McDonnell and the shadow foreign secretary, Emily Thornberry (though a vanguard of activist commentators such as Owen Jones, Novara Media’s Ash Sarkar, Aaron Bastani and Michael Walker, and former Corbyn aide Matt Zarb-Cousin adds ballast).

Momentum’s proposal of “open selections” – under which would-be candidates could automatically compete to stand for parliamentary election – would allow the left progressively to remake the party in its own image. Jon Lansman, the chair of Momentum, insisted, however, that the primary aim was to ensure “accountability”, not remove MPs. “Very few MPs are ever going to be removed by any process because party activists are reluctant to do so,” he told me. “The left does not like sacking people and so it’s much more about getting people to stay close to their communities and their parties.”

Lansman added: “Accountability in government is also important. And that’s one of the reasons why I would advocate an elected general secretary [the post is held by Unite’s Jennie Formby]. Many parties in other countries do have some separation of the role of party chair or general secretary from the role of leader… Chilcot talked about the lack of challenge being so critical over the failures of Iraq. They’re failures in all areas of policy, not just military policy. That’s why the accountability of parties is so important.”

If elected to power, Labour would inherit a fragile economy over-dependent on financial services and consumer debt. The Office for Budget Responsibility estimates that household consumption accounted for nine-tenths of the estimated 2 per cent GDP growth in 2017. Even the meagre growth forecast over the next five years is dependent on household debt rising from 139 per cent of disposable income to 146 per cent.

Grace Blakeley, an IPPR research fellow, who is writing a book on financialisation, told me: “A write-off of unsecured consumer debt would tackle the interests of the banks head-on – it would be a real battle moment, a 1980s moment – and would also make people’s lives better off.

“Over the short to medium term, you need to start thinking about capital controls to curb inflows as well as outflows. London acts as this black hole that sucks in capital from the rest of the world, channelling it into secrecy jurisdictions, so cutting off that lifeline would be quite important.”

Britain is more exposed to financial fluctuations than any other major Western country. The UK has almost $600bn worth of banking links with Hong Kong and China, nearly three times more than the next most exposed country, the US.

In government, the left has invariably been overwhelmed by economic crisis or political resistance. Allies of McDonnell are war-gaming scenarios such as a run on the pound and capital flight. In 1982, just a year after his election, the French socialist president François Mitterrand (whose government included Communist ministers) was brought to heel by the markets (resulting in the tournant de la rigueur, or “austerity turn”). No radical left project has since held office in a major European country. Portugal’s three-party leftist coalition and the new Spanish Socialist government are the only current success stories.

If Pasokification is the spectre that haunts the social democratic left in Europe, then it is Syrizification that haunts their radical counterparts. After its election victory in 2015, the Greek party was ultimately forced to accept austerity as the price of continued euro membership.

In office, when forced to choose, Labour has invariably deferred to capital. The MacDonald administration responded to the 1930s Great Depression by imposing punitive austerity, the Attlee government was split over the introduction of NHS charges to fund the Korean war, James Callaghan anticipated Thatcher by declaring that the option of Keynesian stimulus “no longer exists”, and Blair and Brown struck a Faustian pact with the City that unravelled in 2008.

“There is simply no historical model anywhere in the world for what we want to do which has been successful,” a senior Corbynite once observed to me. “A left government being elected in a post-industrial society and then successfully managing to transition into a major new settlement, whether a new form of capitalism or socialism.”

All left-wing governments, it could be said, end in disappointment. That is the precedent the Corbynites must defy as they enter the next phase of their revolution.

George Eaton is political editor of the New Statesman.

This article first appeared in the 21 September 2018 issue of the New Statesman, Corbyn’s next war