Compass - An 'Ersatz' Left Within New Labour?

Within six months, the United Kingdom will have a new Government. It might be a Tory Government or a Government of the centre-right or centre-left precariously juggling nationalists or Liberal Democrats before being forced to return to the country - or we might see the return of New Labour ...

How New Labour Might Return From The Dead

New Labour's return to power under Gordon Brown looks unlikely but it is far from impossible. Its coalition might yet remain solid while the opposition, although a majority in the country and almost certainly in Southern England, splits into its Tory, liberal and radical nationalist components.

The New Labour coalition has some pretty good reasons for holding together and getting its core vote out. The trades unions fear political evisceration under a vengeful Tory Government and the public sector always suffers more in terms of cuts under the centre-right.

The Celtic nations and decaying Northern urban communities have lived off the fat of the South. They know that the machine for taking Southerners cash and re-laundering it back to them via the EU, and more directly, will come to a sharp halt as the Tories look for quick and easy cuts.

Finally, there is a large middle class quangocracy and a fair body of liberal progressives who like the redistribution of English cash to the emerging world. Neither trust claims of compassionate conservatism despite Cameron's attempts to win classical social liberals over to the Tory cause.

For all these reasons and others, New Labour could squeak back in with a majority but if and only if its traditional voters walk out of their front door on the day, forget their rage and frustration - with wars overseas, failures to deal with poverty and 'political correctness gone mad' - and vote.

Compass

And this is where Compass comes in - a sort of ersatz Leftist movement, led by Jon Cruddas, MP, a key figure in the liaison between the trades union political officers and New Labour in the early days of the party's 'modernisation' but now reinvented as the main Left challenger to the consensus.

Its latest mailshot (admittedly to the faithful) is red in hue, its main symbol the internationalist one of a man holding a globe and weighed down by the responsibility, with much talk of 'change' through action (an obvious nod to the Obama phenomenon).

It claims 30,000 members and supporters which, if true, is significant in recent political terms. It is probably 10 times the size of the real membership of the last grassroots revolt within the Party in the mid-1990s.

If Compass succeeds in mobilising its growing number of discouraged activists, students and fringe intellectuals into a machinery for winning Labour a victory in 2010, Jon Cruddas and those associated with him can justifiably demand preferment. Cruddas is Cabinet material under such circumstances.

Ersatz?

I used the harsh word 'ersatz' to describe Compass but I write objectively not to denigrate what Cruddas and his supporters believe themselves to be. They believe themselves to be of the Left because they have taken radical positions within an essentially conservative movement.

Naturally they continue to avoid the 'S' word. Socialism frightens the English horses and is now unacceptable to a progressive mentality that hated Sovietism more than 'American imperialism'. If they are attempting anything, it is to take over the contested word 'progressive' and own it.

Instead Compass speaks of 'greater radicalism' (as if New Labour has been radical at all). This term radical refers back to a late nineteenth century pre-Labour Representation Committee culture of dissent before the socialists and Fabians muddied the waters and confused trades unionists with theory.

To back this up, in their fund-raising and recruitment campaigns, Compass makes seven claims that define what they are and how they want to capture the Labour Party and, through the Labour Party, the Government:

1. Their support for Jon Cruddas as Deputy Leader is positioned as instrumental in getting housing and inequality up the Party agenda.
2. Compass MPs campaigned to add 'ethical', social and environmental obligations (or 'burdens' as the centre-right might put it) on businesses through amendments to the Companies Bill.
3. They have 'led calls' for a High Pay Commission.
4. They campaigned for greater 'tax justice' just before the 2009 Budget and claim that three of their demands were included in Darling's Speech.
5. They campaigned for a windfall tax on the energy and oil firms which, they claim, was instrumental in the Government's subsequent £1bn energy package.
6. They were part of a 'broad coalition' in opposing the part-privatisation of Royal Mail (and claim substantial credit for postponing, though not 'shelving' as they further claim, these plans in July 2009).
7. They collaborated with CND, Greenpeace and Friends of the Earth to delay the renewal of the Trident nuclear WMD system.

Assessment

This is not a bad record over eighteen months or so - certainly so when compared to the complete failure of any Left challenge to the prevailing order within the Party since the middle years of Kinnock's leadership.

But it is not quite as impressive as they claim. The determination in their literature to tell us that 63% supported a High Pay Commission and 67% supported the windfall tax on energy tells us that the campaigns are still not built on principle but on populism.

Compass is not a coherent ideological challenge to New Labour. It is pitching for a place in New Labour's sun, adopting its assumption that power derives from political mobilisation. Compass will claim its place on mobilising votes for New Labour rather than by mounting a cogent critique of its failures.

Nor has it achieved a great deal of a practical nature. The changes to the Companies Bill may be irritating to business but they are insignificant. The windfall tax and the postponement of Royal Mail part-privatisation and Trident owe far more to straightened economic circumstances than Compass.

Compass' power resides entirely on its ability to mobilise disillusioned activists to vote for a Party that has (by any standards) been involved in illegal war, been a mere adjunct to a foreign power and reduced basic civil liberties (albeit in return for increased 'human rights').

It has also been administratively incompetent, done little about inequality and presided over a disastrous economic meltdown built on an unsustainable use of credit to promote growth. So, the critique of particular policies rather than the system is telling - loyalty and solidarity trump analysis.

The Limits of Compass

Closer analysis of Compass' claims show that its power is extremely limited. The big wins are merely postponements of controversial policies. The use by the State of their street pressure to mount windfall raids on the prosperous are not signs of a shift to the Left but of economic weakness.

The particular failure to position housing (a sector which cheap credit was designed to deal with) as ring-fenced, alongside the educational and healthcare expenditures that most concern the swing middle classes, shows that Compass is still mostly noise and fury.

In fact, the Government has done very little to claw back bonuses or deal with high pay as a structural issue. It bought into 'international competitiveness' arguments about the City, on which welfare spending now largely depends. Compass has no consistent alternative critique of this strategy.

Compass is being used by New Labour to give itself the opportunity of stabilising and even advancing its vote in the street. Compass offers the Party the chance to mobilise activists to knock on doors and show enthusiasm on the day without having to make any promises it has to keep!

Hope Again!

What New Labour needs is students and activists on the doorstep able to counter negative arguments with a message of hope and hope is best spread by believers and not by bureaucrats.

We have covered hope before in our postings - it is a very powerful political tool but also one that raises expectations. Growing disillusion with Obama in the US is the price paid for using hope as a campaign weapon. But New Labour is now desperate - later disillusion it can live with, loss of office it cannot.

Any New Labour Government that emerges on a bit of populist Left legerdemain will not be radically different from the one that it replaced. It will still have a PLP dominated by the centre-right of the Party and figures like Mandelson and Miliband, even Purnell, will be of more significance than Cruddas.

If Brown remains in office (it would be hard to dispose of an election winner for perhaps another two years), the Brownites will be manouevring to protect their future. Cruddas and the Compassites are likely to be seen as merely the mobiliser of the OMOV vote in a Leadership contest.

But this is where Compass pays off for its PLP and union promoters. It builds bridges across the Party to non-Party progressives. Its real power will lie either in its value as a chip in a leadership contest if existing factions are prepared to bid for its vote or in the immediate aftermath of a defeat.

Compass' populist stance has thus nothing to do with the country and everything to do with the Party. If it can 'own' the grassroots activists and then pull disillusioned outsiders into the party for the first time or as returnees, it could, with trades union support, transform the balance of power within the Party.

What Compass Means

This is what Compass is about - the recapture of the main centre-left Party by the Labour Movement so that it can resist, in coalition with progressives and the regions, a vicious class attack from the Southern middle classes.

What the Labour Movement fears is the ending of the New Labour commitment to full employment, deregulation of the labour market and cuts in public spending affecting their members. Civil liberties, issues of war and peace and national sovereignty are trivial next to these concerns.

A beaten New Labour Party with a disillusioned and divided activist base might open the door to decisive action by the Conservatives to break the link between the trades unions and politics, decentralise public services (removing union bargaining power) and turn the labour market into a free-for-all.

For trades unions, the best and only option is to ensure the return of a Labour Government against the odds so that the Tories collapse back into a futile English nationalism. But if that option fails, the second line of defence is a united 'resistance movement' that has forgotten the failures of New Labour.

So, Compass is not unimportant. It is of no direct political consequence currently in terms of policy but, as a tool of Labour/trades union recovery, as a potential influencer in the next Leadership contest and as a centre of labour resistance to Tory 'reform' on defeat, it needs to be watched.

But, at the end of the day, it is still an 'ersatz' Left. It has no coherent ideology other than a general and vague progressivism and labourism where labourism represents a decreasing number of people. 

Labourism just wants more 'working class representation' within an existing Blairite politics. Compass, in this context, replaces coherent thought with populism. It suffers from the same disease as New Labour - a preference for power over principle.

This is not its fault. The structures of New Labour offer no alternative to challengers - and there are signs that Cruddas may be sympathetic to reform of those structures. But what Compass offers to anyone outside the special interests operating within Labour coalition remains unclear.

A Jeffersonian Model for Modern Britain

The Japanese, German, French and Hong Kong economies are now coming out of recession. This leaves all eyes on the original core of the economic crisis - the Wall Street/London axis - and, of course, on the effects on the global economy of any wild card collapses like the Ukraine or perhaps Russia.

'Ave a Cup of Tea, Dearie'

The consensus amongst the British establishment is no longer grim so much as dogged. Things may be tough for some time to come, but (so it is believed) capitalism will not collapse, adjustments will be made and things will right themselves in due course.

James Buchan in Prospect Magazine asked last month whether Britain was bust. The conclusion was that we would 'muddle through'. "Ave a cup of tea, dearie". Dunkirk spirit.

There is certainly something very British about our grumpy belief that our Government is like the British weather - changeable, unpredictable, subject to some sort of 'hurricane' very very occasionally but basically dull, stable and gloomy, something to be endured.

Market Tolerance

The markets appear to have worked out that the Government has to continue to over-spend for political reasons until the election takes place, but that, once the need to be nice to the electorate is over, it will err on the side of the international investor over the demands of its people.

This helps to explain the tolerance of the market for the oodles of debt being offered to the market. Of course, the UK economy is one of the world's largest. It is also politically stable by global standards with a strong state and a stubborn and large anti-socialist middle class.

In short, the UK is a very good bet for repayment and for eventual fiscal stability. The market believes that the British state is so strong that it can enforce almost anything that is required on its people without threat to itself. It is probably correct in this assessment.

Nothing Is Certain In Politics

We have elsewhere suggested that the British political structure comprises a newly dominant Tory Party with three parties vying for the party of opposition - the troubled New Labour Party, the weak Liberal Democrats and the rising UKIP (at least in the South).

But the assumption that New Labour might not win a majority in the House of Commons may be false. The Tory Party is as tainted by scandal as its main rivals. As Cameron moves to the centre-ground, he alienates his 'tribesmen' who may be inclined to dabble in UKIP's waters.

The Tory Front Bench attack on Tory Daniel Hannan, MEP, over his Fox News remarks on the NHS may appeal to the mass of British voters but an attack on Hannan is also a coded attack on the eurosceptic right within the Party.

Libertarian Dissent

There is a complex of dissident values here - euroscepticism, a demand for tax cuts and a call for cuts in 'waste' in public services. Hannan's comments on the NHS open up the irritation amongst some of the libertarian Southern middle class at the remnants of the old social democratic consensus.

The markets will demand that the 'Keynesian' explosion of expenditures (as much political as economic) be reined back by whoever is in Government next year. Given this requirement, the parties only differ on the balance of spending cuts and tax rises.

The Conservative High Command is trying to ring-fence the health and education sectors for political reasons (though it keeps adding departments as different constituencies moan that they are being left out). Now it finds that it has its own Fifth Column.

Tweedledum and Tweedledee

But all the major parties are now just squabbling over the type of pain to be inflicted on the population and who will be most victimised.

What would a Government of 'national interest' rather than one of party advantage being doing now? Almost certainly, despite the Keynesian claims, it would be beginning to cut public expenditures that do not relate directly to current or future economic growth and innovation.

Each week that passes without some recognition of the scale of the crisis burdens future generations that are wholly innocent of the greed and stupidity of their elders.

Community and Market

Similarly, no major party (with the partial exception of the Liberal Democrats) has grasped the nettle that the crisis arose from permitting a market system to follow its instincts without any community intervention.

In the struggle between community and market, the State, as representative of the community interest, has moved in thirty years from being the sclerotic social democratic assassin of innovation to the other extreme - a mere player in a game whose rules are being set elsewhere.

Even now, there is no sign that Government of any stripe has any understanding that the State, even if it is a State that fully supports liberal economics, is not just a player but the player. In the absence of world government and a weakening US hegemon, it must set the rules so that it can always win.

A Bit of Political Philosophy

This begs the question of what the State is and what it is for. The institutionalist view is that the State is an interest separate from the community it notionally serves. History tends to confirm the truth of this proposition.

Conservative opinion is understandably nervous that any attempt by the State to set the rules for the economy is tantamount if not to socialism then to corporatism and rule by special interests. This is the libertarian driver for the Tory Right's concern to cut taxes and weaken the State.

It is a point of view that bringsthe Tory Right into alignment with the US Republican Right - and with Fox News. Without a strong alternative - that state and community are fully aligned in practice - this emphasis on individual freedom becomes increasingly attractive to many angry citizens.

The Alternative Tradition

There is another radical tradition, historically of the Left, which identifies the interest of the community with the State.

Conservative opinion is rightly nervous here because, since the foundation of the Labour Party, this has meant, in practice, a strong state directed first at socialism and, latterly, at support for the special interests that sustain the clique at the top of the main Party of the Left.

However, there is no need for an identification of the State with the community to mean the domination of the community by the State - in practice, the domination of the population by whichever clique captures the party that captures the State.

A Jeffersonian Alternative

An alternative might be the radical recasting of the political system so that the State becomes the servant of the people, decentralised and much closer to the model of Thomas Jefferson. There is no voice for this model at the heart of British politics, although the Liberal Democrats come closest.

Given the lack of the political classes' support for any radical recasting of the political system (despite the growing evidence that increasing numbers in the wider population are inclined to 'revolution'), the mainstream parties are repeatedly trapped into making the existing system work.

But what would a Jeffersonian model look like? Well, we use Jefferson loosely here. The UK is an advanced service economy with exploited migrants, not an agrarian economy based on slavery. Similarly, the Enlightenment would scarcely stand up to the intellectual scrutiny that it would receive nowadays.

Spending Cuts

But we can adapt to the general principle by which the State is merely a tool of the community and has no desire to expand except that it be in the interests of the community. The community will make its own assessment of its needs through democratic means without the intrusion of special interests.

The honest position is that we have all got drunk at the party and have been presented with the bill. This bill must now be paid but those who drank the most should pay it. Revellers should not scarper and leave the bill to be paid by servants.

Public spending must be cut but the cuts must be, and be seen to be, at the expense of the State structure and of the special interests who benefited most, generationally and sectionally, from the revelry.

The Banking System

The UK has made itself highly vulnerable to the global economy by allowing mega-financial institutions to dominate its economic policy-making. There is a role in servicing such global institutions but the national banking system and the global banking system need separating out from each other.

Regional and community banks and stock markets need support and to be discouraged from becoming sucked into the global market in the way that the Landesbanken in Germany and the Icelandic banks have done. This means a far more active engagement by Government in regulating the banking sector.

The aims must be to restore the capital base of the banking sector as a prerequisite for stable lending and increased transparency in banking business. This will not nationalise banks but will demand the same sort of standards that we might require in food quality, consumer rights or travel safety.

Social Capitalism

The one concession to post-Jeffersonian socialism is that, when Government takes tax revenue, the bias in expenditure must be less towards immediate consumption (employment and general services) and increasingly towards investment in the infrastructure for innovation and growth.

New Labour's model appeared to be to pump money into people's pockets so that economic growth could be fuelled by demand for goods and services. An alternative is to create the infrastructure for economic prosperity through investment and education.

To be fair, Gordon Brown eventually changed his tune with plans for investment in energy and, latterly, transport infrastructure - and one of the few successes of this government has been investment in parts of vocational education - but all this is still relatively late in the day and still limited in scope.

The Bonus Culture

While not fully accepting the po-faced earnestness of Compass in its plans for a High Pay Commission (since innovation and success deserve high rewards), there must be a link between pay and long term success that recognises that short term bonuses are not the way to run an economy.

The short term bonus distorts the market and fails to build up long term national capital. There can be no objection to regulation of such tools so that they can become linked to real long term measures of wealth creation.

This author can certainly see no objection to progressive retrospective taxation of recent bonus income in the light of the crisis if ever we get to the point where unemployment is sustained at 3m for more than a year and there are massive cuts in public services.

A Jeffersonian Programme

So, there we have it ... a Jeffersonian programme of sorts ...

• The State given to the community and taken away from special interests.
• 'Fair' public spending cuts.
• A partial withdrawal of the national economy from the global system in order to stabilise it.
• A shift of expenditures from support for consumption to investment in economic infrastructure and innovation [the 'new deal' model].
• Government intervention to assist the bottom 15% and to restrain the top 15% without intervening in the liberties and independence of the 70% inbetween.

Bodging It

Does any current political party come close to this sort of moderate national programme? The current political class is, as Buchan has suggested, muddling through.

All parties are still committed to an economic model that dominated the period from the 1980s to the credit crunch. None have a sense of a nation that is greater than the sum of its individuals.

It is a recipe for long term decline as a succession of political oligopolists bodge their way through social order problems, spending cuts and economic distress.

For all the communitarian talk of Brown and Cameron, neither has presented a workable model for the command of the State by the people nor for the just sharing of the pain in the coming years of austerity.

Either we give up on the interventionist State altogether and take the libertarian route of the Tory Right and of UKIP or we develop some sort of communitarian democratic model, tantamount to a revolution from below.

This author suspects that we will be muddling through for decades to come.

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