No Change from Labour
Late in September the National Executive Committee of the Labour Party presented a four thousand word statement to the Annual Conference at Blackpool, with the title Britain: Progress and Change.
It was not a list of promises for the next election nor, in the main, a claim to have been successful in the four years that have passed since Wilson’s government was elected in October 1964. In fact it is difficult to decide what purpose the document served. One suggestion (The Times 30 September) is that the idea was to take the minds of the delegates, and other members, away from present despondency and apathy—firstly by explaining that all the original plans are sound but have taken longer than expected to produce results and secondly, by showing how all will be well a few years ahead. Several times phrases are used in the statement on the lines of’ “we all thought that Britain’s economic problems could be solved more quickly than in the event has proved possible”. Having thus disposed of a lot of things even Labour Party supporters grumble about, attention is directed to the shape of things to come, “Britain in the Seventies”.
If the first part of the statement is an attempt to explain away the government’s failure in its four years of office, the second part indicates, though in a very vague way, what may be the vote-catching promises of the next election. One of them is headed “A Fair Society” — a masterpiece of false suggestion that much has already been done by the Labour Government.
The paragraph begins:—
Britain to-day is still divided by privileges inherited from an earlier age. The maldistribution of income and wealth is the most obvious example, but it is not the only one.
and it ends “there still remains in Britain glaring and unacceptable inequalities in income and wealth’’. (Their emphasis).
In between we are told that the inequality still left is “despite the growth, under successive Labour Governments, of a crucial public sector with vast assets owned by the whole people”.
Long ago the Labour Party claimed to have the intention of ending the concentration of wealth in the hands of the propertied minority. In their 1918 Election Address they pointed out that 90 per cent of wealth was owned by a tenth of the population. At every election since then the Labour Party has promised to do something about it but for all practicable purposes the position now is just what it was fifty years ago.
And what Labour Party supporters are offered for absolutely nothing done is the figment of “owning” the nationalised industries; as if it makes any difference to a worker without large sums to invest that wealthy people who formerly held railway or steel company shares now hold Government securities instead.
Among the many surprising admissions of the statement is one about full employment, price stability.
The task before us is formidable. No democratic society in the world—or for that matter, any other society-has ever succeeded in achieving, all at the same time, economic growth, price stability, rising wages and increasing social expenditure.
This is a complete reversal of the confident attitude of the Labour Party in the past. For at least twenty years it has been an article of faith among the leaders of the Labour Party and their economist advisers that with the magic wand of Keynesian techniques they could do all the things with the greatest of ease. It was precisely because of this belief in their power to control and operate capitalism on lines chosen by themselves that they could dismiss the Socialist argument that capitalism is uncontrollable and must be replaced by Socialism.
So what happens as it dawns on the faithful that the Keynesian magic does not work? That it never had a chance of keeping price stability, and that the low unemployment since the war in this country has not been the result of applying Keynesian policies? (Professor of Political Economy R.C.O.) Matthews examines this in the September Economic Journal.
There are too, cold winds from another quarter. Under pressure from foreign bankers the Wilson Government and its advisers are being required to revise their ideas about monetary theory and practice—in effect to repudiate Keynes (or at least to repudiate the version they have favoured for many years). This kind of switch would present no particular problem to the Tory Party (which also has its Keynesians) but will not be so easy for the Labour Party.