Category: Photography

By BAGEHOT

Britain’s governments over recent years have tried to accentuate its strengths. They have been exceptionally open to foreign trade and investment, have calibrated regulation and foreign policies according to the needs of the City of London, have kept the country's product and labour markets the most liberal in the EU, have first rolled back (Thatcher) and then kept rolled-back (Major, Blair, Brown, Cameron) the role of organised labour. That has had pros and cons. It leaves some British workers poorly protected and forced to compete on price in low-skill service jobs; it means heavy exposure to financial shocks and migration surges. But it also underwrites low unemployment and a large, lucrative pool of employment in high-end service jobs, some of the prosperity from which trickles down (though too little to correct what is, by European comparison, an hourglass-shaped society). An imperfect settlement, certainly, but nonetheless one for which many countries would trade their status quo and which could be very much worse.

Yet the consensus is slipping. For the first time since the Thatcher years, both main parties are questioning it. On the right, Theresa May has committed to restricting foreign takeovers, putting workers on company boards, meddling in executive pay and (further) cracking down on immigration. From Ed Miliband, the former Labour leader, she has lifted “predistribution”: the notion that the state should crank up incomes through regulation, rather than topping them up with welfare. Mrs May has also pooh-poohed Mr Osborne’s bid to turbocharge cities like Manchester and has created a department for “industrial strategy”, a term that often implies ministers deciding which sectors are grooviest at a given moment and always implies a cosier relationship between firms and the state. And she has halted plans for a new, Chinese-backed power station.

Meanwhile on the left, Owen Smith (the more centrist of the two resolutely left-wing candidates for Labour’s leadership) wants to tighten up the labour market, increase taxes on high personal earnings and investment incomes and create a Ministry of Labour. None of the other parties, from the Liberal Democrats and the Greens to UKIP and the SNP, seems to think very differently. As Matthew Parris pointed out in the Times yesterday, this outlook is taking hold in the country at large: “Inch by inch, we economic liberals may be losing ground.”

That many want to rub capitalism with sandpaper is understandable. Britain’s red-in-tooth-and-claw economic model has meant precarious work for millions. It generates greater inequality and worse living standards than the German model. Though it need not be, it is synonymous with a run-down public sphere: closed libraries, dirty streets, overpriced housing, overcrowded and unreliable public transport and a poor work-life balance. It can be especially unforgiving to post-industrial towns. It threatens to make the country too reliant on the whims of autocratic political and business leaders in Beijing, Moscow, Dubai and the like. The Brexit vote, the biggest shock to Britain’s place in the world since Suez (and perhaps before then) was in many ways an itch to these rashes. It is right that the country’s leaders should ask the obvious questions.

But questioning is all they are really doing. Mrs May and Mr Smith talk as if their corporatist, or christian democrat, or social market (or whatever you want to call them) proposals had never occurred to their predecessors. Most of all, the new consensus—Theresanomics?—thus far fails to offer an alternative to the imperfect but buccaneering model that has dominated policy-making for the past decades. Have Britain’s strengths been overrated? Does the country have other strengths, waiting to be tapped, that others have missed? Is Britain, culturally and structurally, less different from its northern European neighbours than previous governments have recognised? Perhaps the answer is yes. If so, let Mrs May and Mr Smith and those of a similar bent give forth. But thus far I am unconvinced. When I asked Professor David Soskice of the London School of Economics, one of the fathers of the Varieties of Capitalism school, whether it made sense to look to northern Europe and Asia for a model of political economy Britain could emulate, he demurred: “No, I don’t think it does. I think we should look to the United States, which has a capitalist system much more similar to ours.”

This matters for two reasons. First, however desirable a shift may be, there are big reasons to doubt whether Britain, the quintessential “liberal market economy” (or LME as the Varieties of Capitalism theorists categorise it), is temperamentally suited to the structures and norms of a Germanic “coordinated market economy”, or CME. Second, there are plenty of ideas in the ether that would help address Britain’s problems while working with, not against, the grain of its existing, LME model: for example, Mr Osborne’s attempt to knit together the big northern cities, measures to help workers in a fast-moving economy retrain and relocate, reforms to boost and improve the quality of university attendance (even at the expense of the country’s perennially flaccid apprenticeship system), a trade policy focused on selling the City to China, perhaps even some first moves towards a negative income tax or citizen’s income. Or in the words of Nick Pearce, a former 10 Downing Street policy head to whose fine blog post on Mrs May and Varieties of Capitalism I am indebted: “May would do better just to loosen the spending taps, and invest in infrastructure, R&D and skills, while leaving corporate governance reform, industrial strategy and regional policy to Heseltinian romantics.”

The point is: Brexit has thrown much into the air. Britain, it is true, needs a detailed debate about its economic future. But the terms of that debate matter. If there are good reasons for the country to try to jolt itself out of its LME eco-system and into a CME one, let Mrs May and her fellow travellers produce them and let Britain conceive its future accordingly. But if there are not—if Britain’s current model is indeed path dependent and ineluctable, if Mrs May and Mr Smith are letting ends obscure means—then the country needs a very different discussion: about how it can make the best of its existing strengths. Time for answers.

By BAGEHOT

The analysis exudes reason and decency. It is also wrong. Partly because the assumption that the SDP held Labour back is unconvincing. In practice, as is often forgotten, the splinter took more votes from the Tories than it did from Labour. Moreover, it also exerted the sort of external pressure on the party’s right flank that helped the likes of Neil Kinnock make the case for change from within. And it incubated the party’s moderate tradition (Roy Jenkins, for example, came to be a mentor to Tony Blair).

And in any case, the objections are a giant category error. References to the SDP are simply otiose.

First, the Labour Party’s situation now is substantially grimmer than it was in 1981. Michael Foot was a better politician than Mr Corbyn: cleverer, more intellectually heterodox and a better speaker. In 1980 he beat Denis Healey, his moderate rival, by just 52% to 48%. Last year Mr Corbyn took 59% of the vote against three rivals—a figure on which, if nominations by local party branches are anything to go by (they usually are), he may improve in the current leadership election. Meanwhile most unions, which in the 1980s were moderate and integral to Labour’s salvation, are today in the hands of the left. And social media makes it much easier for the hard left to organise and consolidate than it was back then: Momentum is Militant with a Facebook account and a sympathetic media eco-system (think Novara, The Canary and other blinkered but popular pro-Corbyn websites, their reach amplified by the echo chambers of Twitter, Facebook and Snapchat). In this context, moderate assumptions that the reconquista can be as quick and successful as that of Mr Kinnock, John Smith and Mr Blair look wildly optimistic.

Second, the chances of a new party succeeding are better than they were in 1981. Britain is a much less deferential and rigid country than it was then. Voters are more fickle. Fewer define themselves according to the party for which they vote. UKIP's rise illustrates the electorate’s willingness to break from established parties. In other words: a new Labour breakaway need not crumble on contact with voters’ fixed loyalties as the SDP did.

Third, and most importantly: the degree of alienation of Labour’s MPs from its leadership today is almost incomparably greater than it was in the 1980s. Most of Mr Corbyn’s shadow cabinet has resigned. If he wins the leadership contest he has no chance of reconstituting a full shadow ministerial line up (if you include junior ministers). Unlike Foot he has suffered a vote of no confidence endorsed by over three-quarters of his MPs.

My point is that enough MPs despair of Mr Corbyn to split off, refound the party and annihilate its remaining, far-left rump. The problem is that the vast majority also seethe about the SDP splitters in the 1980s, see Labour as family and adore its history and tradition. That is understandable. Yet is it really truer to the party’s founding mission—to provide representation for working people—to look on as Labour systematically alienates those it was meant to serve? The most optimistic projection put to me by the anti-splitting tendency is that, perhaps, over a decade or so, Labour can be made electable once more. This is dismal. And, anyway, a more pessimistic projection is probably more realistic: that, whole, the party will simply spin off into irrelevance; Britain as a sort of delayed Poland in which a social democratic party that obtained over 40% of the vote 15 years ago shrivels into irrelevance, leaving behind a battle between liberals, conservatives and populists.

The alternative need not be as grim as those MPs imagine. If as many of them as despair about their leader quit, “Labour” will become rump of administratively incapable hard-liners, while True Labour (as we might call it) will inherit almost all of the party’s political talent. A defection on this scale would not work in the same way that the puny, 28-MP SDP one did a third of a century ago. There would follow a battle over whether “Labour” or True Labour actually owned Labour’s (1) pragmatic, social democratic heritage, (2) national voice, (3) local branches and (4) brand. If the 172 MPs who declared no confidence in Mr Corbyn in June sided with True Labour, this new party would automatically inherit (1) and (2), some of (3) and—with a successful legal challenge—most of (4). True Labour’s role would then not be to compete amicably with Mr Corbyn’s “Labour” but to marginalise or, ideally, destroy it by appropriating the Labour mantle through sheer weight, dynamism and persuasiveness. I see few reasons to believe that such a party would lack the talent, prominence, funding potential and organisational ability to do so.

Just imagine:

On September 24th 2016, Jeremy Corbyn wins reelection. Within hours he moves to consolidate his control of the party. One-by-one, MPs start declaring their independence from their reelected leader; eventually over 150 have done so. Local Labour Parties begin to split along leader-rebels lines. Staffers in Labour’s headquarters formally disregard Mr Corbyn. A True Labour declaration of independence and social democratic principles is promoted by leading MPs and Labour grandees like Mr Kinnock. A majority of Labour MPs rally around it and appoint a True Labour interim leader and shadow cabinet sporting the best of the party's parliamentary talent (perhaps: Angela Eagle as leader, Rachel Reeves as shadow chancellor, Tom Watson as a continuity deputy leader).

True Labour obtains recognition from John Bercow as the official opposition. Donors are sought and local branches established. These swallow the moderate segments of Constituency Labour Parties and welcome a flood of new centre-left and centrist members, including many previously unaligned voters politicised by the Brexit vote. The new opposition leader, Angela Eagle, discards Mr Corbyn’s unelectable stances and puts real pressure on Theresa May. Conservative splits over Europe start to fracture the government. True Labour becomes more confident and prominent as “Labour”, despite its many loyalists, sinks into chaotic infighting and—unrestrained by moderates— alights on even more looney policies. Come the 2020 election, True Labour is a competitive force, while “Labour” looks like a pressure group posing as a political party and, with few locally active door-knockers and a dysfunctional leadership, sinks into irrelevance.

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As things stand this is not a realistic scenario. But only because Labour MPs are too frit to make it a reality. Most recognise its desirability. But most are also hidebound by their tribal commitment to the “party” currently run by Jeremy Corbyn. They struggle to accept that Labour is more than its institutional carapace and that to reestablish it as a formidable electoral force is not to abandon it, but to save it and the best of its tradition. If Mr Corbyn wins the current leadership election Labour MPs must choose between two futures for their party: decades of infighting that may or may not generate an electable social democratic force or a painful but effective break that would immediately generate an electable social democratic force. The future is in their hands.

By BAGEHOT

So it is hard to imagine circumstances more generous to Mr Farron. And to be fair he has his achievements. While Labour lost seats at local elections in May, the Lib Dems gained 45. And some 15,000 people joined the party after the Brexit vote. Yet nationally there is no sign of a Lib Dem comeback after the party’s abysmal showing in last year’s general election. It remains stuck at the 8% in polls to which it first fell a few months after Mr Clegg took the party into government in 2010. Voters, it seems, simply do not think about it much these days: in a poll by YouGov out today 65% of them—and even a third of Lib Dem supporters—have no positive or negative view of Mr Farron (Mr Clegg should be so lucky).

What has gone wrong? Why have the political earthquakes of the past twelve months had no obvious effect on the party’s national standing? One answer is that it will take much more than one year for the Lib Dems to recover from the bad reputation they (mostly unfairly) acquired in government: as quislings, softies and most of all dissimulators. British voters have long memories. An event at the Brighton conference asked whether the party would return to power before 2080.

Another factor is the party’s sheer smallness in the House of Commons. The Lib Dems may have more than 100 members of the House of Lords, but in the elected chamber they have just eight representatives. An upcoming redistricting exercise may reduce these MPs to four. Thus they are simply not accorded much attention. Television interviews, select committee chairmanships, parliamentary questions do not come their way as they did when, before the last election, there were 57 Lib Dems in the Commons. To recover, the party needs the sort of prominence that will not fall into its lap.

There are two additional explanations that make yet harder reading for Lib Dem loyalists. The first is that Mr Farron may not be up to the task. In a British political landscape dominated by hucksters, authoritarians, isolationists and delusionals he is that rare thing: a moderate, decent political leader who speaks his mind and is not obviously incompetent. But for the Lib Dems that may not be enough. Up is not the only way they can go. Their leader’s task is simultaneously to arrest decline and to propel a new advance. Greater talents than Mr Farron would fail in his shoes. And for all his likability, he does not come across as a heavyweight. Mr Clegg may be widely reviled, but at least he is recognised. A year into his job, Mr Farron enjoys no such scorn. His speech to the party this afternoon offered glimpses of the sort of audacity and swagger needed to change this, but was more impressive on the page than in the hall.

That, at least, the party can do something about. If, in a year, Mr Farron’s party is still on 8% in the polls, it should ditch him and reinstate Mr Clegg. But a second factor transcends such questions: the tectonics of British politics. Demographically, as I have long argued here and elsewhere, Britain is moving in a cosmopolitan direction that should benefit the likes of Mr Farron. Yet the Brexit vote seems to have unleashed forces pulling in the opposite direction: a new hostility to migrants, a triumphalist purism about Brexit in swathes of Westminster and Fleet Street that greatly exceeds anything promised before the referendum and most of all a bring-it-back nostalgia that now infuses the political mainstream (reviving old icons of British power and independence, from Britain’s old blue passports to Britannia, the royal yacht). Little of this touches the Lib Dem electorate, or that minority of voters torn between the Lib Dems and Labour. But in the real centre ground this shift matters and may change the electoral calculus.

Mr Farron’s strategy is clearly to win over moderate Labourites alienated by Mr Corbyn. Hence the praise in his closing speech this afternoon for Yvette Cooper, Caroline Flint, Chuka Umunna and even (albeit in a qualified fashion) Tony Blair. This may help the Lib Dems pick up some new members. But electorally, the sorts of places where Mr Farron’s welcome blend of social democracy and liberalism does best are safe Labour seats in places like London, Bristol and Norwich. Places where enough people vote Labour for Mr Corbyn’s uselessness, even on the delicate matter of Brexit, to be almost immaterial. If there is any low-hanging fruit for the Lib Dems it is in the south-west of England, where the Tories swept the board last year but where, for deep historical reasons to do with local industry and religion, there remains a strong liberal streak. In those constituencies people voted for Brexit and care little for Mr Blair and his successors.

I fully understand Mr Farron’s thinking. Perhaps, a year into Mr Corbyn’s disastrous leadership of Labour, the Lib Dems can now fruitfully bid for Labour members. Indeed I expect this gambit will work out: I would not be surprised if thousands of Labourites joined the Lib Dems in the next year or so. And in terms of Britain’s political spectrum, the Lib Dems have a more important role—as the guardians of the progressive centre—than perhaps ever before. The question is: will any of this translate into votes, influence, and power? Here I am pessimistic. As things stand I do not see Mr Farron leading the sort of liberal reconfiguration at which he hints. I hope to be proved wrong.

By BAGEHOT

OWEN SMITH was never the front-runner in Labour’s leadership contest. But moderates in the party hoped that he would at least begin the process of clipping away at the mighty mandate, 59% of vote, that accrued to Jeremy Corbyn last year. Perhaps this could be shaved to nearer 50%. And perhaps, in one of the three voter categories—full members, registered supporters and affiliates (mostly union members)—he could even be beaten.

After all, the last twelve months have seen Labour wade progressively farther into a moral and electoral swamp. Mr Corbyn was a dismally poor cheerleader for Britain’s continued EU membership. Today the country is without a functioning opposition. The rules of the leadership contest, too, should have helped Mr Smith: some of Mr Corbyn's supporters had been prevented from voting, either because they signed up too late or because, having made offensive or anti-Labour comments on social media, they had been “purged”—as some of his backers melodramatically describe the party’s vetting processes. Surely, but surely, the moderates could put a dent in Mr Corbyn’s armour?

No, came the answer. In Liverpool, where Labour’s conference begins tomorrow, it has just been announced that Mr Corbyn has defeated Mr Smith with 61.8% of the vote. Labour’s leader won resoundingly in every section of the party’s electorate. In his acceptance speech he talked of unity: “things are often said in the heat of the debate on all sides that we later regret”, he said in soothing tones: “As far as I’m concerned the slate is wiped clean from today.” In their reaction afterwards many Labour MPs—willing, until recently, to acknowledge frankly what an unmitigated car crash Mr Corbyn’s tenure has been—fell dutifully into line; their glassy-eyed waffle about “taking the fight to the Tories” clashing more than a little with the self-mutilating decision their party had just made.

Mr Smith’s defeat speaks to quite how stuffed the party is. Early in the contest he looked like the moderates’ best hope. He hails from the centre-left of the party rather than its right so appeared capable of winning a hearing, at least, from Mr Corbyn’s fans. He was relatively unknown and thus free of the political baggage burdening Angela Eagle, his rival for the moderate candidacy whose vote for the Iraq invasion was particularly toxic among the grass roots. If anyone could broker a provisional cease-fire between the Labour base and reality, it seemed to be he.

In practice it was not. Mr Smith was energetic and had a capable campaign team. He toured the country. He had well-run events and well crafted speeches. But there were three problems. First, he was gaffe-prone: suggesting that Britain should negotiate with Islamic State, for example, and letting slip several disagreeably macho comments, like one in which he looked forward to “smashing” Theresa May “back on her heels”.

Second, his compromise was the worst of both worlds. He pitched too far left to seem conventionally electable but not far enough left to capture some of Mr Corbyn’s idealistic appeal. His criticisms mostly concerned the Labour leader’s lack of managerial and presentational smarts. Why, lefties asked, vote for Diet Corbyn when the full-fat variety is available?

Third, and most fundamentally, efforts in the run-up to the race to recruit new, moderate voters to Labour’s electorate (that is, to do on the party’s centrist flank what the Corbynites had done so effectively on its left-wing one) were too little, too late. Saving Labour, an outfit established to do just this, did not have the time or network needed to rival the Corbynite-Momentum juggernaut. Mr Corbyn’s well-attended rallies around Britain confirmed that, while most voters have a low or no opinion of him, a minority small enough to be near-irrelevant in national elections but large enough to be near-hegemonic in internal Labour ones sees him as a sort of messiah.

What next? For all the talk of unity, Mr Corbyn will certainly press his new advantage. For example, he wants to put more policy-making power in the hands of members. There has been talk—denied by the leadership—of plans to move against one or both of Tom Watson, the deputy leader, and Iain McNicol, the general secretary. A push by Labour MPs to seize control of shadow cabinet appointments will likely be resisted. Plenty of MPs, nervously eyeing coming re-selection battles, will bow their heads and shuffle back into the shadow cabinet. The result: a Labour Party yet further alienated from ordinary voters and a Britain yet further deprived of the effective opposition it so badly needs.

It may be that the party will need to split in the future. While acknowledging that moderates currently have no appetite for it, I have rehearsed the arguments for such a move on this blog before: not least the obvious fact that with every month Mr Corbyn is leader, the task of one day undoing the damage he has caused spirals farther towards impossibility. In a spirited blog post Paul Mason, one of his media cheerleaders, even suggested that my proposals hinted at some new “coup” being cooked up by Labour’s social democratic wing. As will be plain to see in the coming days, no such plotting was ever afoot.

I remain convinced that Labour’s MPs may later be forced by circumstances to take this route. But for now they should make at least one more big push to take back the party and make it moral, effective and electable once more. My view on this has been changed by closer study of the severe deficiencies of Mr Smith’s candidacy—and of the Saving Labour-led recruitment campaign. Mr Smith is a decent man with decent advisers. But it was, in retrospect, wrong to assume that a candidate offering a pale replica of Mr Corbyn’s own policies and a last-minute push for centre-left recruits represented the best challenge moderates could mount. They can do better. That despite these limitations Mr Smith’s candidacy secured 38.2% of votes suggests that there is still a sliver of hope; hope that a better-planned, better-fronted, better-thought-out challenge can succeed before Mr Corbyn has the time and strength to wreck Labour for good.

That means finding a good candidate—or ideally, candidates—and most of all staging the mother of all recruitment campaigns. It means a degree of intellectual and institutional renewal on Labour's centrist wing. It means forging a deep, broad network capable of attracting to the party the sort of pragmatic, centre-left types who want to see a sensible, competitive Labour capable of winning power and exercising it impactfully. Work on such a network, building on initiatives like Saving Labour, must start today and draw inspiration from (adapting, not copying) primary-winning movements elsewhere like that of Barack Obama in 2008 and Matteo Renzi in 2013. It is not yet clear when the opportunity for a new, good-as-can-be challenge to Mr Corbyn will come: perhaps after the party’s inevitably unimpressive results in the local elections of 2017 or 2018, or after a Labour rout at an early election called by Mrs May. But when it does come, the moderates must be ready.