People before profit: Labour's ethical past and its response to the latest crisis in capitalism.

Author:Davis, Jonathan

Ed Miliband has stated that people are questioning 'the post-1970s consensus about the extent to which unfettered markets always result in optimal outcomes.' This, he says, is 'a problem that requires a fundamental re-examination' (Miliband, 2012a). The Labour Party's own re-examination of the problem has included various ideas such as ethical socialism, Blue Labour and responsible capitalism, which are all driven, in different ways, by the same historic value: that people matter more than profit. These responses need to be understood as working within the framework of Labour's ethical past. As this article will show, ideas from Labour's past are enjoying a resurgence, and are challenging the New Labour assumption that ideological politics ended with the collapse of communism.

The 1970s phase of capitalism began to end in 2008. What will follow is still being worked out. All political parties are discussing this question, but Labour's history shows how it can define what happens next. In the early twentieth century, the party was founded to give workers who wanted parliamentary representation an alternative to the Liberals; after the Second World War, the Labour government set up the NHS and the welfare state as a response to the Great Depression which framed the experience of all policy-makers. It helped to establish an infrastructure based on fairness in a time of austerity. Today, Labour has a similar opportunity to re-craft its own political narrative and the ideals of the country. The ideas that are currently being discussed inside the party are being informed by its best traditions; those that valued community, that put people before profit, and that gave them hope of a society where they mattered more than markets. This article assesses how Labour's ethical past is contributing to the debates about the nature of British democracy.

Capitalism in crisis and Labour's ideas about society

Out of the global crisis in capitalism known as the Long Depression (1873-1896) came the Labour Representation Committee (LRC). The various socialist groups within the labour movement, including the Independent Labour Party (ILP) and Fabian Society, along with the trade unions, joined together in 1900 to form an organisation to give workers parliamentary representation. Within six years, the LRC had become the Labour Party. Although its socialism was generic, as it entwined various strands of left-wing thought, it had at its centre a hope for a more compassionate, ethical future.

At the end of the 1920s, global capitalism was again in crisis as the Wall Street Crash led to mass unemployment, the rise of right-wing extremism, and war. But fifteen years later, Clement Attlee's Labour government, guided by ethical socialism and Fabian ideas, began to fulfil the promise of a better world. The NHS and the welfare state put fairness and equality at the heart of the country, despite the huge financial burdens that the war had left behind. And despite the best efforts of the free-marketeers and privatisers, the NHS celebrated its 65th birthday this year and is still free at the point of use.

In response to both crises, Labour spent part of its time working out what it believed in and what it would do when it got the chance to govern. Hopeful idealists in different groups discussed alternative visions of society that were based on the idea that there was a better world than the one created by capitalism. For example, in the late Victorian era, according to G. D. H. Cole, the ethical socialist William Morris 'passed from Art to Socialism, because he saw that under Capitalism there could be no art and no happiness for the great majority'. As long as 'men remained in thrall to the industrial system, there could be no good art and no good life for the mass of the people' (Cole, 2012 [1917], 57). In the 1930s, the influence of other models of socialism and social democracy (the USSR, FDR's New Deal and Sweden), and debates about state intervention, defined Labour's ideas. These all played a crucial role in clarifying Labour's programme, and the policies implemented by the radical Attlee administration emerged from these discussions (see Davis in Corthorn and Davis, 2008, 73-8).

Labour emerged from both crises in capitalism as a party that sought a different world, replacing capitalism with a system that was not based on exploitation, did not allow unemployment to blight the lives of millions, and would end the pursuit of profit at all costs. While the promise of socialism no longer drives the party today, the values that defined its history are again beginning to shape the debates about what it must do now.

The left has often attempted to reinvent itself and to engage with new ideas (the emergence of the New Left in the 1960s being a good example of this). What is significant about the current engagement with ideas is that it is taking place after the New Labour years when the party followed a more technocratic, less values-based, approach. What can be detected in the arguments of Jon Cruddas, the Labour Left and Maurice Glasman, is a desire for a values-driven approach to define Labour's ideals.

Before the First and Second World Wars, the ILP, Socialist League and Fabians were amongst the groups who generated Labour's ideas. Today, there are advocates of ethical socialism such as the Labour Left and Jon Cruddas. There is Maurice Glasman's Blue Labour, which supports localism and the living wage. And Labour's leadership calls for responsible capitalism and 'One Nation' Labour. Though different in their aims, these groups, like the groups from past eras, are engaging with ideas about the best way to connect with people outside of Westminster and to create a fairer, more humane, society.

Labour is moving away from its New Labour years when it accepted that socialist ideology died in 1991 and that managing democracy was all that mattered. In today's process, Labour is doing what it did in its early years and in the 1930s: it is debating the merits of different forms of government. And although a reformed capitalism, rather than socialism, is the desired outcome for some, there are again groups inside the party who are sketching out an alternative vision of society. It may not be a socialist vision, but it is one that at least challenges the idea that profit matters more than people.

The crisis in liberal democracy

It is not only in the Labour Party that a parallel with the past can be seen. The wider crisis in capitalism today also shares certain traits with earlier eras. The economic similarities, such as mass unemployment, are obvious. But there is also a crisis at the core of liberal democracy as distrust in politicians grows and fewer people vote in elections. In the Victorian era and post-Second World War years, the franchise was not as wide as it is today. The 1884 Representation of the People Act widened the franchise, but it did not bring about universal suffrage as around forty per cent of men and one hundred per cent of women were still without the vote. Supposedly a democracy, 'British politics bore the heavy imprint of traditional, autocratic elements. Participation was, in practice, limited by wealth and class' (Pugh, 2012, 19) (and, of course, gender). It was not until 1969 that the voting age was lowered to 18.

In the past, there was an obvious desire to participate in the democratic process. Throughout the nineteenth century, the dispossessed fought for and gained a voice in parliament as they came to speak collectively through the Labour Party. This desire is harder to find today, and there is a growing self-disenfranchisement as...

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