Today’s globalised capitalism, based on the needs of Wall Street and the City of London, prioritises capital ahead of production. Wealth and investment is no longer confined by national boundaries, and over the forty years since Thatcher ushered it in to the UK, it has allowed globalised corporations to move skilled jobs abroad, or to import cheaper labour to the UK, in order to drive down wage costs and drive up returns to shareholders. So once proud and prosperous manufacturing towns saw their factories and steel mills replaced by call centres, which were themselves then replaced by warehouses and pizza shops. Exploitation became global but the effects were very local. This globalised exploitation cannot be met with a local response – it has to be global too.
Yet the mantra was always that governments can’t intervene, as though the free market was truly sacrosanct. Democratically elected governments were the only block to globalised corporations doing what they wanted with impunity, so the capitalists forged a new orthodoxy, telling the government to butt out. Michael Hesletine’s pledge as Tory Environment Secretary to “intervene before breakfast, dinner and tea” – or was it “lunch and dinner” ? - may have been startling at the time but it was still stamped upon.
New Labour’s response was to focus not on defending existing jobs, but on reskilling and the use of the tax and benefits system to minimise financial distress; an option quickly removed by the Tories and LibDems after 2010.
So with national governments unwilling to act against the globalised market fundamentalists, much of the response to globalisation has been to focus on the local: devolution of some powers over spending decisions followed by devolution of limited government resources. Which all too often means devolution of Tory austerity and with it the removal of responsibility for central government to take further action to support local and regional growth. Too many on the left have seen devolution as the answer to Tory austerity and the squeeze of globalism, when regional and sub-regional government without the necessary resources will simply exacerbate the problem and increase people’s sense of the futility of politics, as another layer of government is denied the resources to make radical improvements in people’s lives.
The problem has been further exacerbated as much of the devolution has been centred around the large urban areas with their figurehead directly elected mayors. Smaller towns and more rural areas are squeezed out by the big cities which are sucking in investment and political attention, so squeezing out the towns. Town centres diminish as wages stagnate. So a further divide is not just between town and country, but between city and town, as a mish-mash of different local government arrangements is used to deliver different forms of devolution, to address a national problem of under-investment often not caused by domestic power structures at all but by Conservative austerity and global capitalism sucking wealth out of the UK.
It has been a hugely successful tactic of the Conservatives to deny local and regional government the resources to deliver successfully the services people need to halt the national decline, and then to blame those local councils and mayors when services fail. So school and children’s services budgets have been slashed, and we have lost 21,000 police officers nationally, but an increase in knife crime is apparently all down to Sadiq Khan.
As Labour found after 1997, its big plans for regional government, so desperately desired outside London during the Thatcher-Major years, dissolved to nothing after two years of the Labour government when folk had a government they felt really cared for all of the UK. So rebalancing of power must come with a genuine end to austerity, with real resources to councils and mayors and whatever structure is in place; but crucially it must also come with a national government strategy committed to actively defending the UK against pillaging global corporations value- stripping the UK; committed to redistribution; and specifically sharing growth fairly across the UK, rebalancing the UK economy to towns as well as cities and to rural as well as urban, so that no region gets left behind. Devolution on its own is no solution at all.
Plans to allow councils to keep all their business rates must be resisted: richer Tory areas will simply get richer, and their business rates income will be used to depress council tax rates, so giving them artificial political credit for a low council tax they do not deserve. Fairness in redistribution must remain the bedrock of a socialist government programme.
The answer to the threat of globalised capitalism cannot be simply devolution of Tory austerity, nor even more money for regions under a Labour government: a government that is prepared to stand and fight for the people who elected it is a government on the side of the people and against de-skilling and exploitation. Communities may fight for the minimum-wage, zero-hour scraps provided by an Amazon warehouse on a former manufacturing site, but the government must enforce proper employment and union rights and make companies like Amazon pay their proper share of tax on UK operations. An active government, willing to overturn the orthodoxy of 40 years of neo-liberalism and get tough with the globalised exploiters would be a good start in defending the communities left behind, and restore people’s faith that politics can work for them again .
Our country faces an existential challenge far deeper than the immediate issues in the current Brexit debate. Every corner you turn in Parliament at the moment are people having conversations about immediate challenges of Brexit. But that debate is far from what it needs to be. If the Brexit story is to deliver any benefit at all, it has to start with renewed focus on the deeper causes of Brexit, and our journey to address them.
The absence of a proper debate that also engages and informs the public has been a characteristic of the post-referendum period where the debate has continued down the fault lines set by the referendum campaigns.
Whilst the Leave campaign have been successfully challenged on substance (£350bn for the NHS, easiest trade deal in history etc) – they have certainly won on emotion and narrative. The story they told about our nation travelled and resonated across the country. The most powerful words in politics – “take back control” has still yet to be properly understood. It needs to be and to be understood by the left. Until we do so, and own this emotionally as well as in policy, we will struggle to unite across the fault line between leavers and remainers which continues to persist.
At the heart of this has to be an analysis of power and where it lies, and of its counterpart – powerlessness. Just a quick canter through an MP’s caseload will give clues. Powerlessness in getting a job, in getting repairs done to your home, in getting a home or stopping an unfair eviction, in getting redress from difficult neighbours, in getting the police to respond after a crime is reported, in stopping drug dealing in the alley around the corner, in stopping a community or youth centre being closed down. The list goes on. The national version is also evident. Getting trains to run on time. Preventing the demise of the steel industry or now car manufacturing. Stopping delays to your hospital appointments. Seeing no pay rise as food prices, bus fares and rent go up.
In such a context, national statistics about growth in the economy seem irrelevant if there is no visible impact on the challenges people face in their everyday lives. More so than before, and with potentially worse to come if the economy goes through a deep downturn, there is a growing narrative on the failure of globalisation and the rise of the voice of the “left behinds”. The rise of that voice is for good reason – a deep inequality of power socially, politically and economically that has come to manifest itself in the power of “taking back control”.
The economic failure of globalisation, the failure of mainstream politics and the withdrawal of the state under austerity has also led to a growth of identity politics and the rise of the “other”. Our cultures have become more focussed on that which divides us, not that which unites us. Tackling the economics and the politics is vital if we are set to reverse the social divides. The steady rise in hate crime is a testament to this. Cameron and Osborne have also choked off the working class communities and resources that went into them. The paradox we face is of communities most hit by austerity now seeing a Tory-led Brexit as the solution to the problems they genuinely face.
So how must public policy on the left address this? Some important responses to this have recently been laid out by Ian Bremmer in his latest book. His ideas include a new role for the state and a Government, meeting the needs of citizens and bringing people together rather than building walls, a new definition of social contract, a re-focus on what we mean by “social security”, a new focus on the pursuit of happiness.
He’s right about this as a place to start but on its own it doesn’t go far enough. But there are two key challenges. Firstly, how do we link the solutions to the challenge of the lack of control? How can we see a public services reform agenda that can demonstrate how citizens and communities can take back control. How can devolution strategies be seen to respond to this. If all we see is devolution of responsibility without resources, we are set to fail. Central to this has to be the role of the state.
Secondly, we cannot address the issue of taking back control in isolation. We need to define a new internationalism, a renewed sense of purpose about our place in the world and what we want to achieve. As an example, Gordon Brown saw the development of Africa as a moral purpose and drew in the rest of the world. It was a conversation that we had in the Party and outside, that drew in movements for economic justice and symbolised our place and purpose. In contrast, we see today the rise of the right, the success of “take back control” in Trump’s America following the Brexit referendum and the momentum in different direction with a fragmented left struggling to redefine itself. The Tory right are leading the way with the story of our nation. It’s vital for the left to respond with an alternative narrative to the post-imperialist story that has become a new and dominant paradigm.
These deep questions – a domestic reform agenda for the redistribution of power through devolution and a re-focus on a positive national identity with a new left internationalist narrative about our place in the world are more urgent than ever. In just a few short years, Britain has gone from a nation that won the Olympics bid based on a story of diversity and global outlook, to becoming a nation with a rise of nationalism and fundamental questioning about our history, our nation and even our Union. Something has deeply broken. Our economy has grown less than last year with worse to come. People are less happy and less secure.
As people can no longer look to the next generation being better off than that last, I believe we are witnessing the ending of a post-Cold War consensus on prosperity which we took for granted.
The UK has a choice to make. What role do we want to play in the world, and how and who do we want to influence. We need to be sure of our direction as a nation. Unless we resolve the question of our identity and role in the world, we’ll struggle to win the prize of tackling the domestic questions that are so critical to bring our nation back together and lead an agenda that sees people take back greater control of their lives and their communities.
The need for workers to have a collective voice, first industrially and then politically has shaped the Labour movement in this country for well over a century now. But in the century ahead, changes in the way the economy will operate means that work will not exist in the same way as in the past, and there will quite possibly be a lot less of it about than now.
Constitutional change is perhaps not the sexiest subject in British politics. It is, however, of critical importance if Labour is serious about transferring power and democratising our country.
Over two years has passed since the EU referendum. And in that time, millions of hours and columns inches have been spent debating both its causes and its consequences. Though any desire to find a single common cause will always result in either frustration or over simplification, I do believe that one phrase had particular significance, that of “taking back control”. This phrase didn’t just resonate with the millions who voted Leave, it also resonated with millions of people who voted Remain. And the reason it did, was less to do with our membership of the EU, than it was the resentment people feel towards the economic and political status quo.
Karl Marx is back in fashion. And for good reason. The 200th birthday of Trier’s greatest son was the trigger for an extraordinary wave of re-appreciation: ‘Happy Birthday Karl Marx. You Were Right!’ ran the New York Times; ’more relevant than ever’ said the Financial Times. ‘Surprisingly relevant’ wrote the Economist.