one nation
Two Classes, Two Parties, One Nation
By raising living standards and by social reform we are succeeding in creating One Nation at home.
The Next Five Years, 1959 Conservative manifesto
In social security, we still have austerity National Insurance benefits that impose poverty standards on the retired, the sick and the unemployed.
The New Britain, 1964 Labour Party manifesto
In 1950 the House of Commons moved from the House of Lords, where it had sat since the bombing of 1941, into a new steel and concrete House. Designed by Sir Giles Gilbert Scott (of the red telephone box and Battersea power station) and engineered by Oscar Faber (of modernist flour mills of the 1930s), it was disguised to look like the old one. Much remained the same in the political system too. Labour had retained the House of Lords, only limiting its powers. It had abolished university seats and other forms of plural voting but retained the first-past-the-post system. After 1950 the pace of change was glacial. In 1958 life peerages were introduced, for men and women, who were now allowed into the Lords for the first time. From the 1964 Labour government onwards, except in some odd cases, no new hereditary peerages were created. The Lords continued otherwise unreformed until 1999. As far as the House of Commons was concerned the changes were minimal. The voting age was reduced from twenty-one to eighteen in 1969; because the Northern Ireland parliament was abolished in 1972–3 the number of seats for Northern Ireland was increased from twelve to seventeen, under an act passed by the Labour government in 1979, which came into effect only for the 1983 election. There was nothing as significant as happened on the continent, where politics were substantially restructured sooner or later after the Second World War, with the abolition of monarchies, new constitutions and the creation of new governing parties. But the very foundations of British politics had also changed. Politics was no longer, with important exceptions, about empire, free trade, the constitution or religion or territory. Instead it was the politics of the policy of the nation, and the politics of class. Parties of national scope now dominated politics.
However, the real politics of industrial society was now more than ever conducted elsewhere than parliament. This was reflected in the fact that that neither big business, nor big local manufacturers, nor indeed big trade unionists now sat in parliament. In this world of the hidden politics of industrial society there was accommodation, or mutual recognition of interests, rather than consensus. There was no great capacity to forge significant agreed positions. The actual attitudes of business were more economically liberal than an assumption that they shared in some Keynesian, interventionist consensus suggested.1 Organized labour also was less enamoured of the status quo than ‘consensus’ might imply. Hence in part the usefulness of the notion of ‘corporate bias’, by which the state, as the crucial active party, used high-level national organizations representing capital and labour essentially to neutralize dissent.2
Nevertheless, open party politics mattered also. It was conducted by two very different dominant political parties, who indeed saw themselves as very different. They disagreed on much and had different priorities and interests. There were also important disagreements within parties over crucial issues. There was an unsteady agreement to disagree and to acquiesce, on both sides, which limited freedom of action. It was more like an armistice than a ‘post-war settlement’, more an agreement to differ than a ‘consensus’. Stability, legitimacy did not require consensus.
Capital and the majority who owned no capital faced each other on more equal terms than before. There was some redistribution of wealth and income, and wealth and status could not be displayed as nonchalantly as before the war. The wealthiest 1 per cent owned around 40 per cent of the wealth (as measured from tax returns and death duties) compared with 56 per cent in 1936–8. For income from property, 1 per cent got 60 per cent and 10 per cent got 99 per cent.3 As before, the great majority had negligible net assets. Public debt, a debt for the poor and an asset for the banks, individuals, and foreigners, despite being much greater than that of the Great War, paid low interest and was inflated away.4 Furthermore wages rose with respect to salaries, and top pay failed to rise with inflation as low pay did. The share of wages in national income went up. Differentials narrowed. Through indirect means – supporting trade unions, the tax and benefit systems, a certain amount of redistribution was effected.
THE TWO-PARTY SYSTEM
Although the basic structures of the early twentieth-century political system remained, their outward appearance, and the effects they generated, was very different. The first-past-the-post electoral system now entrenched two class-based parties covering nearly the whole United Kingdom. The Conservative and Labour Parties were now roughly equally matched. Labour, in opposition, had 47 per cent of the seats in 1951 and 44 per cent in 1955. Other parties were driven out of the House of Commons. In 1964 only the Conservative Parties, Labour and a handful of Liberals had seats. In 1966, apart from Gerry Fitt, sitting for Republican Labour in Northern Ireland, and twelve Liberals, all MPs belonged to the Labour Party or the Conservative Parties. As recently as 1945 there had been twenty-seven members of small parties, including two Communists, two ILP, two Irish Nationalists and more. After 1966 the smaller parties would return, not least Scottish, Irish and Welsh Nationalists. By the 1970s there would be eight parties in parliament, though most were tiny.
Also in contrast to the situation before 1945, the electorate now had the decisive say in changing governments. Now, with one exception, only elections changed governments. The great majority of administrations were single-party ones with absolute majorities. There were no more coalitions. There were periods of minority Labour government. The minority Labour government formed in February 1974 went to the polls in October 1974 but only got a majority of three. This disappeared in 1976, and for the remainder of its life the government depended on some of the small parties voting for it. It also negotiated an agreement in 1977–8 called the Lib-Lab Pact, under which the Liberals voted with the Labour government but would pre-agree legislation, and in a 1978 vote of confidence were supported by the Ulster Unionists. The government lost a vote of confidence and fell in March 1979; the first to do so since the Labour minority government of 1924.
The final important difference with the pre-1945 political system was that the two governing parties were different sorts of beasts, in a way which was not true of the Liberal and Conservative Parties when they dominated politics between them. Labour was the party of workers and welfare; the Tories the party of wealth and warfare. Nearly all the manual workers and teachers sat for Labour; most of the barristers, businessmen and military officers for the Tories. Society was not pillarized into political/religious segments of equivalent status and power – politics was fundamentally asymmetric. As in the years before 1950, in the years 1950 to 2000, the Conservative Party dominated – it was in office for thirty-five of these years.
THE CONSERVATIVE PARTY
The Conservatives staged an extraordinary recovery in the 1950s. They won the election of 1951 with fewer votes than Labour but would continue to increase their vote. In the late 1950s the Conservative block got nearly 50 per cent of the votes. The core Conservative alliance was doing better than in 1935, or the 1920s; only in 1931 had it got a higher proportion of the vote.5 In the 1950s it was a mass organization, with an estimated, perhaps exaggerated, membership peaking at nearly 3 million, nearly three times peak Labour individual membership.6 This comparative success requires some stressing and explanation. What it meant was that a very significant proportion of the working class must have voted Tory, more than before the war. Indeed, although the working class now, and only now, tended to vote Labour, its lead over the Conservatives with these voters was not huge. In 1951 the Labour lead among the working class was at around 10 per cent, though it had been over 20 per cent in 1945. Even in the 1950s Labour did not have, as indeed it had never had, a complete dominance even among trade unionists. In 1957 Harold Macmillan noted his party needed ‘at least 3 million Trade Union votes’.7 Still, Labour could easily be identified by the Tories with the male manual producer. For there was also an important and changing gender dimension to voting behaviour. In 1951 and 1955 the Conservatives had a more than 10 per cent lead over Labour among women, and most women were, of course, working class. The Conservatives had set out to be the party of consumers, and of housewives, and reaped the benefits.8 Yet if it was the party for women, it was not the party of women. During the whole period from 1951 to 1974 there were only two Tory women in cabinet, both in what was considered a woman’s job: minister for education. They were Florence Hosburgh, 1951–4, and Margaret Thatcher, 1970–74.
The Conservative Parties consisted of essentially four non-competing parties into the 1960s, operating in every part of the United Kingdom. They were the Conservative and Unionist Party, the [Scottish] Unionist Party, the Ulster Unionist Party (dating effectively from 1905) and the National Liberals. The (Scottish) Unionist Party merged into the English and Welsh party in 1965. The Ulster Unionists stopped taking the Tory whip in 1974 and would leave the Unionist family of parties in 1985. The National Liberals were more important than the independent Liberals between 1950 and 1964, though they petered out in the 1960s. Indeed, in 1951 and 1955 the Liberals returned only six MPs, with 2.5 percent of the vote.
The Conservatives and Unionists were posh parties. The English and Welsh Conservative and Unionist Party was led by the aristocratic Winston Churchill to 1955; by Anthony Eden, from a minor aristocratic family, to 1957; and by Harold Macmillan, married into the grandest of aristocratic families, until 1963. Macmillan was succeeded by a fully titled aristocrat, the 14th Earl of Home, or Sir Alec Douglas-Home, as he became on renouncing his peerage. The ministers in Conservative governments of the 1950s and early 1960s were overwhelmingly public school and Oxbridge educated. Around one-sixth were aristocrats, and fully one-third Etonians.9 The Labour Party, excepting a small part of its leadership, was very different. Those with secondary and university education had, as in the case of the Tories, tended to have been to public schools and Oxbridge. Where Labour differed was that part of its front bench (and most of its MPs), had no secondary or university education. Neither parliamentary party, in other words, had a strong cadre of the emergent grammar school/civic university middle class. Labour was the party of the elementary school, the Tories of the public school.
The Tory Party was also the party of the officer class. In the 1950s, after years of conscription, high warlike expenditure and continuous military operations, the martial virtues were very evident in public life. To have had a good war was an advantage. Many young men who reached high army rank prospered in the party, among them Brigadier Enoch Powell (elected 1950), Colonel Frederick Erroll (elected 1945), and Lieutenant-Colonel Edward Heath (elected 1950). Sidney, Viscount De L’Isle, was a dashing officer who won the VC in Italy. Major Peter Carrington MC, 6th Baron Carrington, was remarkable for holding many ministerial positions from the 1950s to the 1980s, including foreign secretary, entirely from the House of Lords. Major William Whitelaw MC (elected 1955) was to be home secretary and deputy prime minister (and was one of two childless men elevated to hereditary viscountcies by Margaret Thatcher). By contrast, the younger Labour leadership tended to come from men who were dons and wartime civil servants rather than soldiers, for example Hugh Gaitskell, Harold Wilson and Douglas Jay, though many had served as relatively junior officers such as Captain Tony Crosland, Major Denis Healey, Major John Freeman, Captain Roy Jenkins, Squadron Leader Merlyn Rees, Flying Officer Peter Shore, Pilot Officer Anthony Wedgwood Benn and Lieutenant James Callaghan RN.10 In 1953 the Tory cabinet had four former Grenadier Guards officers in it.11
The Tory Party was also without question the party of business. The very great majority of their MPs, when they were not ministers, had serious external interests (unlike most Labour MPs). Only twelve Tory MPs in 1966 had no identifiable remunerative job outside parliament; and some of these were simply retired from such work and others had private income.12 In 1966–7, 243 Tory MPs held 290 positions of chairman, deputy chairman, or managing director of enterprises; and 601 had directorships. The comparable figures for Labour were 32 and 70. While 123 of the 363 Labour MPs had been manual workers, and 99 teachers, the number of Tory former workers or teachers was negligible.13
The businessmen were not just backbenchers. Churchill brought back his own key businessmen from wartime, Woolton, Leathers, Lyttelton and Bennett, into government. Oliver Lyttelton, as colonial secretary, was in charge of Malaya from 1951. He had been chairman of the largest group of tin-mining companies in that territory. Percy Mills of W & T Avery came into his own under Macmillan, as did Frederick Erroll (a Cambridge engineer who served as president of the Board of Trade and minister of power). He was later to be chairman of the papermaker Bowaters and of Consolidated Goldfields. Harold Watkinson, another businessman and engineer, served as minister of defence. Aubrey Jones, an economist who worked in steel, was minister of supply. But perhaps most obviously and importantly, Harold Macmillan was himself a businessman, chairman of the family business, the publishers Macmillan & Co.
From 1965 the party was led by Edward Heath. Very unusually for a Conservative, he spent some time after the war as a civil servant, and as a journalist for the Church Times. From his election in 1950 he was a professional politician. Men from business played important roles in his shadow cabinet in the late 1960s and in government 1970–74. For example, Sir Keith Joseph (of the builders Bovis) spoke on industry and trade in opposition. When Heath came into office in 1970 he brought industrial people into key positions. Robert Carr, an MP since 1950, went to the Department of Employment to introduce the new Industrial Relations Act, a major innovation. Carr was a Cambridge-trained metallurgist and had been head of research and development in his family’s business, John Dale Ltd, makers of non-ferrous tubes and aluminium products. John Davies of BP had been director-general of the Confederation of British Industry and came in as secretary of state for trade and industry. Peter Walker was in finance. Heath brought in Lord Rothschild, of Shell, as head of a new think tank: Rothschild was a man of power – aristocrat, scientist, and former member of the security service.14 There were younger men from business, such as the publisher Michael Heseltine and the engineer Nicholas Ridley of a Tyneside civil engineering firm, Brims and Co.
The contrast with the Labour Party was clear here too. For while it did have its Oxbridge graduates, and men who served as officers in the Second World War, its connections to business were minimal. Labour-affiliated and Labour-funding business people were typically Jewish. The Conservative Party, by contrast, attracted both Jewish and non-Jewish businessmen. Harold Wilson in particular was associated with Lord Kagan (ennobled 1976), who made Gannex raincoats in Huddersfield. Captain Robert Maxwell of Pergamon Press, who later owned the only Labour-supporting paper, the Daily Mirror, was briefly a Labour MP. The main financial experts in the party were Harold Lever, Edmund Dell, Joel Barnett and Robert Sheldon, all businessmen, Jewish and from Manchester.15 They all chaired the Public Accounts Committee; indeed, they were the only Labour MPs to do so between 1970 and 1997. They also all served in the Treasury, while Dell was in addition secretary of state for trade. He had worked for ICI between 1949 and 1963. Other Jewish businessmen/experts on management were Ian Mikardo (who applied his management skills to canvassing, inventing the Reading Pad, named after his constituency), and Austen Albu, an Imperial-College-trained engineer who served as minister of state in the short-lived Department of Economic Affairs in the 1960s.16
THE LABOUR PARTY
The Labour Party was a conservative organization. It was dominated by the right of the party in the House of Commons. Clement Attlee was leader until after the election of 1955; he was succeeded by another public schoolboy and Oxford graduate, Hugh Gaitskell, who was leader until his death in 1963. This leadership was supported by right-wing trade union leaders, who dominated organized labour. Its socialism was muted and concentrated in the ranks of its individual members in the local constituency parties. One way to look at this is that the fundamental aim of the Labour Party has always been extremely modest. It was to get trade unionist and/or workers into parliament, to nationalize the coal mines and related industries, and to obtain a comprehensive welfare state providing a national minimum of what was first called ‘maintenance’. That may indeed have been the limit of its ambitions, leaving it with little more do after 1951.
Yet Labour was a complex coalition of ideas, and the history of these ideas, and of its policies, is not well understood from within the arguments of the factions, which still dominate the histories.17 For example, Hugh Gaitskell came out emphatically and decisively against the Suez adventure (not least because the US was not on board) and was against the Common Market (and in favour of the Commonwealth). Gaitskell thus went against the patriotic-imperialist end of Labour in 1956 and the right-wing pro-Common Market revisionists (and in particular his ideological spear-carriers such as Roy Jenkins). By later standards these stands, and his welfarism, would put Gaitskell at the far left of the party. The Labour right preferred to remember his failed attempt to get rid of the party’s entirely notional commitment to total nationalization by dropping Clause IV of the party’s constitution, and his success in reversing a temporary position of the party (though not the parliamentary party) in favour of nuclear disarmament.
From 1955 to 1983 Labour was led by four men all born between 1906 and 1916. Gaitskell, Wilson and Michael Foot studied at Oxford; Gaitskell and Foot had been to public school. The fourth, James Callaghan, was a white-collar trade unionist. They were representative of Labour’s leadership, though not its MPs. First, these were products of grammar and public schools and overwhelmingly of the (mostly 1930s) University of Oxford: such as Denis Healey, Roy Jenkins, Michael Stewart, Barbara Castle, Harold Wilson, Patrick Gordon Walker, Richard Crossman, Anthony Crosland, Anthony Wedgwood Benn and Michael Foot. Some had taught at Oxford; most, but not all, were on the right of the party. Then there was the trade union officer class: men who rose without university through the ranks of trade union officialdom. These were men such as James Callaghan (tax officers), Ray Gunter (TSSA), George Brown (T&G), Bob Mellish (T&G), Reg Prentice (T&G), Richard Marsh (NUPE), Fred Lee (AUEW), Roy Mason (NUM) and Eric Varley (NUM). Some had served in the war and were typically commissioned, for example James Callaghan, Ray Gunter, Bob Mellish and Reg Prentice. Some had higher education, sponsored by their union or the TUC, such as Roy Mason (LSE), Eric Varley (Ruskin), Richard Marsh (Ruskin) and Reg Prentice (LSE). They were also, with the exception of Fred Lee, on the right of the party. Reg Prentice defected to the Tories in 1977, Richard Marsh who had left politics to run the railways, indicated support for Thatcher in 1978. Mellish resigned in 1982 and joined the government’s London Dockland Development Corporation. Varley left politics and became chairman of Coalite, which owned the Falkland Islands. George Brown was hostile to Labour in the 1970s and joined the Social Democratic Party, formed in 1981.
Among the leadership of the party the left was weak. Aneurin Bevan, a miner and mining union official, was the leader of the left from the 1940s into the 1950s. Thereafter the leadership of the left included a number of figures – Richard Crossman, Barbara Castle and Michael Foot. In the 1970s the left had a new leader, Tony Benn, who as Anthony Wedgwood Benn had inherited Cripps’ Bristol seat. They had much in common. Both were sons of peers appointed for political service, one Liberal, one Unionist. Both were younger sons, but Benn inherited the title because his elder brother had died in the war. Both were independently wealthy, Christians and vegetarians. Both had a particular connection to science and technology, the first as a chemist and patent lawyer, the second as an enthusiast for all sorts of new machines; he was Labour’s modernizing whiz-kid of the 1960s. Stafford Cripps had been Minister of Aircraft Production during the Second World War; Benn ran its much enlarged successor, the Ministry of Technology. The difference was that Cripps moved rapidly to the right after 1939. Benn moved to the left after 1970.
In the general election of 1951 the Labour Party got its highest-ever proportion of the national vote. It lost votes in opposition in 1955 under Attlee, and in 1959 under Gaitskell. There was, even in the 1950s, a thesis that as it became wealthier, and as society became less class conscious, so the self-identifying working-class Labour vote would fall.18 It was an argument designed to shift the position of the Labour Party to the right, reflecting the belief that it was the Conservatives who were more in tune with the times and the likely future. However, the British working-class did not vote Labour by nature, as the argument assumed. Had they done so Labour would have been the majority party since its creation. Labour did far better among the affluent workers of the 1950s than the relatively impoverished workers of the interwar years. Looking forwards, the thesis does not work so well either. Labour was to continue to increase its vote as the working class got richer and smaller: in 1966 Labour got as good a result as in 1945, with 48 per cent of the vote (in 1964 it had been 44 per cent).
On one possible measure, trade union membership, class consciousness increased over time. In the 1950s and early 1960s trade unions hardly grew at all and were dominated by the right. Most of the unions were affiliated to the Labour Party and supported the Labour leadership against the more left-wing constituency membership. The trade unions were there, as before, to represent a largely male industrial workforce, in the private sector and the nationalized industries. From the late 1960s trade unionism grew rapidly, especially among white-collar workers in industry (the Association of Scientific, Technical and Managerial Staffs (ASTMS) grew notably) and in the public sector, bringing many more women into the trade union movement. Instead of members leaving unions as they became middle-class, the middle classes were joining unions! It is not clear then what was going on – were workers joining unions for individualistic rather than collectivist reasons? Was union membership a measure of the collapse of collectivism? What was clear was that, as union membership increased, the Labour vote fell. The Tories returned in 1970 with 46 per cent of the popular vote. In 1974 Labour were the largest party in a hung parliament with 37 per cent in February, with the Tories out-voting them (38 per cent). They won an overall majority in October with 39 per cent. In 1979, the Conservatives won with 44 per cent, with Labour down to 37 percent. Peak trade union membership was in 1979, and the Labour vote was nowhere near its highest.
The central revisionist argument of the 1950s was not about the working class but about capitalism. Revisionists argued that capitalist business had been transformed into an economically creative force, controlled by its managers, not its owners. Anthony Crosland’s Future of Socialism, in 1956 the revisionist text, should really have been called the future of welfare capitalism. Capitalism, even British capitalism, was then seen as successful. Labour, it was argued, no longer needed to transform capitalism, but to tax it and spend in order to achieve greater equality. Fiscal measures could and should replace concerns with ownership. Labour had in fact already given up on nationalization. In 1950 there was quite a list of industries still to be nationalized – sugar, cement, ‘appropriate sections’ of chemicals, ‘all suitable minerals’, water, meat-importing and wholesaling, cold storage and insurance. By Challenge to Britain, a policy programme of 1953, the contenders had shrunk to a few machine-tool firms, some mining machinery firms and any inefficient aircraft establishment. By the 1957 party document Industry and Society nationalization seemed to have gone entirely.19
The logic of the revisionist position became clear in the 1959 Labour manifesto. The Labour programme was now for the first time focused on welfare. The central plank of the welfare programme was a radical reform and upgrading of the National Insurance pension, rejecting the Beveridgean flat-rate scheme. The 1959 manifesto was to be the most welfarist Labour manifesto ever. Practically its only industrial policy was to renationalize steel and long-distance road haulage.20
Hugh Gaitskell died young in 1963 and was replaced by a leader apparently from the centre left, Harold Wilson, the first non-public-school leader since 1935. He won the general election in 1964 with roughly the same vote Gaitskell got in 1959, but a Liberal revival now ate into the Tory vote.21 He won on a very different manifesto than the 1959 one. It was overwhelmingly national-productivist, which was much more representative of Labour manifestos of the past, and of the future too.
In contrast to the earlier revisionist stories, Wilson stressed that British capitalism was deficient – run by gentlemen, financiers, speculators and amateurs. This analysis was attractive to the left, mixing as it did a traditional Liberal-Labour attack on rentiers, with its commitment to technicians and managers. He was very much in tune with national declinism of the time (see chapter 15). Wilson was a more complex and interesting figure than caricatures of him as merely slippery suggest. As we have seen Wilson was hostile to ‘British’ nuclear weapons and the sale of arms to fascists; he wanted to rein back the British military-industrial complex and was against Common Market entry, at least at first. Later the success would be put down to Wilson’s modernizing, white-heat rhetoric, admired for its vacuous futurism rather than for its serious content. By the standards of the 1980s he was a politician of the extreme left – but the left of the 1960s and 1970s did not see him as such.
CONSENSUS?
The social polarization between the two parties pointed to their very different relations to power in economy, society and state. The Conservatives were the party of multiple overlapping elites; the Labour Party that of the organized working class, and some renegades from the elite. The Conservatives were the party connected to the great warfare functions of the state, the Labour Party at best to welfare. The Conservatives also had most of the newspapers, which reached all classes, on their side. The Times, Telegraph, Mail, Express and Sketch were Tory daily papers. The bias towards the Conservatives increased over time. In 1960 the Liberal (but which supported the Labour right) News Chronicle was sold to Lord Rothermere and was absorbed into the Daily Mail, and in 1964 the Daily Herald (the Labour paper) was renamed the Sun and in 1969 sold to Rupert Murdoch, leaving the Mirror as the only Labour-supporting newspaper. Most of the very high-selling Sunday newspapers were Conservative, such as the News of the World (selling 7 million), the Sunday Express, Sunday Mail, Graphic, Empire News and others; the Labour-supporting Sundays were Reynolds News, the Sunday Pictorial and Women’s Sunday Mirror.22
We should, for this reason alone, resist the tendency to discuss politics in the 1940s, 1950s and 1960s in terms of consensus, or the post-war settlement. The concepts came to frame the history of an entire era because from the 1970s historians and others wanted to defend what they took to be the good progressive post-war arrangements, while a minority were critical of it as stultifyingly retrogressive.23 For both the notion of a consensus served their purposes. Consensus embodied a naive claim that what mattered was party politics.
The concept of ‘consensus’ was only partially about whether there was agreement – it is at least as much about what there was supposed to be agreement about. For consensus was defined in relation to very particular issues, most notably those labelled Keynesianism and the welfare state. Yet the increasing welfare of the British people was not due to Keynesianism or to the welfare state. Economic growth, low unemployment and a whole raft of measures and policies were much more important than demand management or the social services. It was also not the case that the welfare state was the central concern of the elite or the government or indeed political parties.
The very notion thus embodied a particular analysis and choice of what was or ought to be considered central to the life of post-war Britain. By centring consensus on Keynesianism and welfare, the argument was that the origins of the consensus or settlement were found on the liberal-left, and that the right therefore had accommodated to their position. It is no mere thesis about post-war agreement, it is a thesis that made particular claims about the character of the whole of politics over the century. Perhaps the richest version is that there was a national consensus, in which the Conservatives were allowed to dominate in questions of national greatness, and Labour was given the welfare state.24 But most accounts ignore the warfare and foreign aspects and assume the centrality of welfare to the state.
What were Keynesianism and the welfare state? ‘Keynesianism’ is taken to mean very different things. Sometimes a very wide definition of Keynesianism was used as a label for all economic policy, including nationalization and sometimes even the welfare state. It has been suggested that Keynesianism even created the concept of a national economy, but this is unconvincing. The idea not only existed before Keynes, but the Keynesian notion of demand management itself depended on the existence of a national economic space. National economies were defined by economic controls at borders, not economic doctrines. Where this argument is helpful is in making clear the significance of the national economy as an analytical and conceptual category which was real and powerful, even if not Keynesian.
Sometimes Keynesianism is defined narrowly, as demand management, in order to argue that because policy was Keynesian in this sense it ignored ‘the supply side’ or did not lead to a ‘developmental state’. But while this was true of many commentaries and histories it was not true of the history itself. Keynesianism as an idea does not capture more than a fraction of what was distinctive about the control of the economy of the long boom. Keynesianism per se had nothing to say about economic nationalism, the development of agriculture, or nationalization, or regional policies, or industrial policy, or indeed the control of prices and incomes (a feature of the entire 1960–79 period, with a 1948–50 incarnation also). To think about the economy as Keynesian or non-Keynesian is to miss the most important policy levers and transformations in the economy.
As an economic doctrine Keynesianism was the idea that managing the total level of demand in the economy was the way in which government managed to generate the historically unprecedented rates of economic growth (well over 2 per cent per annum on average) which were sustained from the war years into the 1970s, with historically low rates of unemployment. Yet even in this quite narrow sense the concept is unhelpful. Demand management was used, but mainly, as in the Second World War, to restrain inflation rather than to promote growth. It was more stop than go, even with Labour in the late 1940s. The notions that Keynesians were inflationists and those opposed to inflation were anti-Keynesian are both false.25 It was not the case that an inherently sluggish economy was brought to life by stimulating demand. Indeed, this point was made by anti-Keynesians, some of whom regarded Keynesianism as the management of the economy and society by too-clever-by-half men with no families, indifferent to the future, who undermined the moral basis of capitalism, a capitalism which was in fact already generating growth and employment despite them.
The repeated invocation of ‘Keynesianism’ does, however, need to be taken seriously. What Keynesianism, and later monetarism, did was to provide a language around government budgets – a particularly visible parliamentary occasion – which dominated reporting, with the language of expansionary or deflationary budgets, reflation and deflation, stop and go, and later the Public Sector Borrowing Requirement and the Medium Term Financial Strategy of the monetarist period. This filtered into histories telling the story of the post-war economy as stop-go, balance of payments crises, sterling taking the strain, inflationary and disinflationary budgets and so on. This was not unimportant, but was only part of the story. Demand management and a sense of how the macro-economy was to be conceived (which did owe something to Keynes) was only one small dimension of economic policy.
The second key concept was that of the newly-created ‘welfare state’. This is of course associated with another liberal political economist, William Beveridge, though he did not use the term. In the standard consensus account a novel, newly large-scale model of welfare provision rested on a new conceptualization of citizenship, born in the Second World War. These assumptions are, as we have seen, very questionable. The welfare state was largely not new, and what was new was not centrally due to Beveridge. In any case, multiple principles were in play. Furthermore, it was not the welfare state which lifted the British people out of poverty, just as it was not Keynesian economics which kept them fully employed from 1940 into the early 1970s.
The term ‘welfare state’, appeared in English for the first time in the 1920s but was not common, or used in its modern sense, until the 1950s. It first appeared in the work of the then Bishop of Manchester, William Temple, in 1928, meaning something like a democratic state which stood in contrast to a ‘power state’. In was also used in this sense by Sir Alfred Zimmern, Montague Burton professor of international relations at the University of Oxford between 1930 and 1944.26 It was utterly disconnected from the ‘social services’ as can be seen from the fact that Temple and others did not use the term when writing about the social services.27 The modern sense – that of extended social services provided by the state – emerged only in the late 1940s, and became established in the 1950s. By 1960 the sociologist of welfare Richard Titmuss wrote of the myth of the welfare state: the idea that the state had indeed got rid of poverty and misery. The welfare state was, for Titmuss and his colleagues, something yet to be achieved. As we have seen, they and the Labour Party came to the view that in order to do this the key Beveridgean ideas needed to be rejected.
Focusing on the idea of the post-war state as a welfare state gets the state very wrong. What was most novel in British public spending in the 1950s was not welfare spending, but high levels of warfare spending. Comparatively speaking, the United Kingdom was a low spender on welfare and a high spender on warfare, in the 1950s and indeed later too.28 If there was a welfare state in post-war Europe it was not most obviously the United Kingdom.
It is in fact very doubtful whether Keynesianism or welfarism were at the centre of politics, let alone state practices. The economy was discussed in terms of exports and imports, investment, planning, production, at least as much as in terms of budget deficits or surpluses. Welfare policy was not the main focus of politics or policy, even rhetorically, even for the Labour Party, as we have seen. The first time Labour had used the term ‘welfare state’ in a manifesto was in 1955. But this is what it said:
In order to strengthen our Welfare State still further and at the same time to play our part in assisting the under-developed areas of the world, our own production must rise every year. Only a government prepared to plan the nation’s resources can do this. Labour will ensure that the claims of investment and modernisation come first.29
The Conservative manifesto of that year paired the welfare state with military expenditure:
In an armed Welfare State the demands on taxable resources cannot be light. This makes it all the more necessary that government, central and local, should be run economically. There are today over 50,000 fewer civil servants and four fewer Ministries than when we took over. Conservatives will persist in the drive for simpler and less expensive administration.30
There was hardly a political consensus about the welfare state either. Policies, and practices, clearly differed between the parties, and both, especially Labour, distanced themselves from the Beveridge programme.
Big differences in approach were evident in economic policy. Stories of ‘Butskellism’ – originally a jokey conflation of the name of R. A. Butler, the Conservative chancellor of the exchequer in the early 1950s, and his shadow, and predecessor, Hugh Gaitskell, grossly exaggerate the degree of agreement between the parties – Labour was much more committed to planning, to economic nationalism, than the more market-oriented, more economically internationalist Conservatives.31 The Tories denationalized steel in the 1950s, and it was renationalized by Labour in the 1960s. The Conservative government introduced ‘commercial’ television in 1955, known as ‘independent television’ to its promoters. It was funded by advertising, on the American model, and was decried as vulgar from the first and for decades to come. The Conservatives allowed large-scale private road transport, a vital change. Labour opposed entry into the Common Market in the early 1960s, under Gaitskell and Wilson, when the government was firmly committed to it. There were also important disagreements on industrial policy in the late 1960s and 1970s. Edward Heath, later held up as the very embodiment of the consensus, was understood in 1970–71 to have decisively broken with the consensus on industrial relations and the role of the state in industry, repealing key bits of interventionist legislation and abolishing whole ministries.32
Where the concept of consensus might be salvaged is in foreign and defence policy. This is an area to which the idea has not generally been applied. Here the key point is that policy was not so much a matter of consensus between parties as the product, not of party politics, but of the state itself. There are indeed striking continuities across administrations which are in part a story of lack of political input. Such consensus as existed in politics here might indeed stem from the fact of relative lack of expertise and engagement with these issues by Labour (that asymmetry again). Furthermore, the Cold War forced the domestic left onto the defensive, it was in important respects a war on the domestic left, whether communist or not. And the left did suffer – in ‘Natopolitan’ culture, as one new left activist called it, it did not have the intellectual impact it had had in the 1930s or the 1940s.33 There is a case for a consensus on defence policy, but not an overwhelming one. There was, as we have seen, a contested politics of the warfare state. It was mostly a matter of parts of the Labour left criticizing a consensus which generally included the Labour leadership (as in the cases of 1950s British rearmament, German rearmament and the H-bomb). But there was dispute over nuclear policy in the early 1960s between the front benches, which is too easily forgotten.
A second area of consensus, with some dissent, was protectionism, the obligation to buy British and the promotion of British technology. Here, too, parliamentary politics was not relevant – a deeper state and administrative culture was in control. These were central features of what has been called Do It Yourself Economics.34 It was essentially economic nationalism, with a very strong dose of techno-nationalism thrown in. We might also call it Listianism, after the nineteenth-century theorist of economic nationalism, or indeed scientific nationalism, as Listianism has been called by analogy with Marx’s scientific socialism. It is difficult indeed to find a textbook of DIYE, by definition, and hard also to find economists who were openly economically nationalist. Thomas Balogh of Oxford, an economic adviser to Harold Wilson in the 1964 government, was perhaps a partial exception in that he was openly in favour of Commonwealth preferences and hostile to the EEC on economic grounds.35
Economic nationalism was an elusive idea, which if did not exist as formal doctrine was nonetheless a fundamental aspect of economic discourse, and clearly of practice. Everyday economic discussion in the 1940s to the 1970s was remarkably focused on the nation, on the balance of payments as a national profit and loss account, on exhortations to export or die, on production, efficiency, productivity, science and that new key word, technology, all in national context.
Thus, while the proponents of the view that there was a consensus tend to focus their attention on ideas from the liberal-left, on which there was in fact little consensus, we find a very different picture. The issues on which there was a greater measure of consensus – the warfare state and protection – were historically policies not of the liberal-left, but rather the right and of the state. Post-war Labour came to accept protection, conscription and a measure of imperialism, the long-established policies of the Tories. It is rather telling that Harold Wilson so liked the popular historian Arthur Bryant, a national-imperialist protectionist of the 1930s, knighted by the Conservatives in 1954, that he raised him to the Companionship of Honour in the 1960s.
By raising living standards and by social reform we are succeeding in creating One Nation at home.
The Next Five Years, 1959 Conservative manifesto
In social security, we still have austerity National Insurance benefits that impose poverty standards on the retired, the sick and the unemployed.
The New Britain, 1964 Labour Party manifesto
In 1950 the House of Commons moved from the House of Lords, where it had sat since the bombing of 1941, into a new steel and concrete House. Designed by Sir Giles Gilbert Scott (of the red telephone box and Battersea power station) and engineered by Oscar Faber (of modernist flour mills of the 1930s), it was disguised to look like the old one. Much remained the same in the political system too. Labour had retained the House of Lords, only limiting its powers. It had abolished university seats and other forms of plural voting but retained the first-past-the-post system. After 1950 the pace of change was glacial. In 1958 life peerages were introduced, for men and women, who were now allowed into the Lords for the first time. From the 1964 Labour government onwards, except in some odd cases, no new hereditary peerages were created. The Lords continued otherwise unreformed until 1999. As far as the House of Commons was concerned the changes were minimal. The voting age was reduced from twenty-one to eighteen in 1969; because the Northern Ireland parliament was abolished in 1972–3 the number of seats for Northern Ireland was increased from twelve to seventeen, under an act passed by the Labour government in 1979, which came into effect only for the 1983 election. There was nothing as significant as happened on the continent, where politics were substantially restructured sooner or later after the Second World War, with the abolition of monarchies, new constitutions and the creation of new governing parties. But the very foundations of British politics had also changed. Politics was no longer, with important exceptions, about empire, free trade, the constitution or religion or territory. Instead it was the politics of the policy of the nation, and the politics of class. Parties of national scope now dominated politics.
However, the real politics of industrial society was now more than ever conducted elsewhere than parliament. This was reflected in the fact that that neither big business, nor big local manufacturers, nor indeed big trade unionists now sat in parliament. In this world of the hidden politics of industrial society there was accommodation, or mutual recognition of interests, rather than consensus. There was no great capacity to forge significant agreed positions. The actual attitudes of business were more economically liberal than an assumption that they shared in some Keynesian, interventionist consensus suggested.1 Organized labour also was less enamoured of the status quo than ‘consensus’ might imply. Hence in part the usefulness of the notion of ‘corporate bias’, by which the state, as the crucial active party, used high-level national organizations representing capital and labour essentially to neutralize dissent.2
Nevertheless, open party politics mattered also. It was conducted by two very different dominant political parties, who indeed saw themselves as very different. They disagreed on much and had different priorities and interests. There were also important disagreements within parties over crucial issues. There was an unsteady agreement to disagree and to acquiesce, on both sides, which limited freedom of action. It was more like an armistice than a ‘post-war settlement’, more an agreement to differ than a ‘consensus’. Stability, legitimacy did not require consensus.
Capital and the majority who owned no capital faced each other on more equal terms than before. There was some redistribution of wealth and income, and wealth and status could not be displayed as nonchalantly as before the war. The wealthiest 1 per cent owned around 40 per cent of the wealth (as measured from tax returns and death duties) compared with 56 per cent in 1936–8. For income from property, 1 per cent got 60 per cent and 10 per cent got 99 per cent.3 As before, the great majority had negligible net assets. Public debt, a debt for the poor and an asset for the banks, individuals, and foreigners, despite being much greater than that of the Great War, paid low interest and was inflated away.4 Furthermore wages rose with respect to salaries, and top pay failed to rise with inflation as low pay did. The share of wages in national income went up. Differentials narrowed. Through indirect means – supporting trade unions, the tax and benefit systems, a certain amount of redistribution was effected.
THE TWO-PARTY SYSTEM
Although the basic structures of the early twentieth-century political system remained, their outward appearance, and the effects they generated, was very different. The first-past-the-post electoral system now entrenched two class-based parties covering nearly the whole United Kingdom. The Conservative and Labour Parties were now roughly equally matched. Labour, in opposition, had 47 per cent of the seats in 1951 and 44 per cent in 1955. Other parties were driven out of the House of Commons. In 1964 only the Conservative Parties, Labour and a handful of Liberals had seats. In 1966, apart from Gerry Fitt, sitting for Republican Labour in Northern Ireland, and twelve Liberals, all MPs belonged to the Labour Party or the Conservative Parties. As recently as 1945 there had been twenty-seven members of small parties, including two Communists, two ILP, two Irish Nationalists and more. After 1966 the smaller parties would return, not least Scottish, Irish and Welsh Nationalists. By the 1970s there would be eight parties in parliament, though most were tiny.
Also in contrast to the situation before 1945, the electorate now had the decisive say in changing governments. Now, with one exception, only elections changed governments. The great majority of administrations were single-party ones with absolute majorities. There were no more coalitions. There were periods of minority Labour government. The minority Labour government formed in February 1974 went to the polls in October 1974 but only got a majority of three. This disappeared in 1976, and for the remainder of its life the government depended on some of the small parties voting for it. It also negotiated an agreement in 1977–8 called the Lib-Lab Pact, under which the Liberals voted with the Labour government but would pre-agree legislation, and in a 1978 vote of confidence were supported by the Ulster Unionists. The government lost a vote of confidence and fell in March 1979; the first to do so since the Labour minority government of 1924.
The final important difference with the pre-1945 political system was that the two governing parties were different sorts of beasts, in a way which was not true of the Liberal and Conservative Parties when they dominated politics between them. Labour was the party of workers and welfare; the Tories the party of wealth and warfare. Nearly all the manual workers and teachers sat for Labour; most of the barristers, businessmen and military officers for the Tories. Society was not pillarized into political/religious segments of equivalent status and power – politics was fundamentally asymmetric. As in the years before 1950, in the years 1950 to 2000, the Conservative Party dominated – it was in office for thirty-five of these years.
THE CONSERVATIVE PARTY
The Conservatives staged an extraordinary recovery in the 1950s. They won the election of 1951 with fewer votes than Labour but would continue to increase their vote. In the late 1950s the Conservative block got nearly 50 per cent of the votes. The core Conservative alliance was doing better than in 1935, or the 1920s; only in 1931 had it got a higher proportion of the vote.5 In the 1950s it was a mass organization, with an estimated, perhaps exaggerated, membership peaking at nearly 3 million, nearly three times peak Labour individual membership.6 This comparative success requires some stressing and explanation. What it meant was that a very significant proportion of the working class must have voted Tory, more than before the war. Indeed, although the working class now, and only now, tended to vote Labour, its lead over the Conservatives with these voters was not huge. In 1951 the Labour lead among the working class was at around 10 per cent, though it had been over 20 per cent in 1945. Even in the 1950s Labour did not have, as indeed it had never had, a complete dominance even among trade unionists. In 1957 Harold Macmillan noted his party needed ‘at least 3 million Trade Union votes’.7 Still, Labour could easily be identified by the Tories with the male manual producer. For there was also an important and changing gender dimension to voting behaviour. In 1951 and 1955 the Conservatives had a more than 10 per cent lead over Labour among women, and most women were, of course, working class. The Conservatives had set out to be the party of consumers, and of housewives, and reaped the benefits.8 Yet if it was the party for women, it was not the party of women. During the whole period from 1951 to 1974 there were only two Tory women in cabinet, both in what was considered a woman’s job: minister for education. They were Florence Hosburgh, 1951–4, and Margaret Thatcher, 1970–74.
The Conservative Parties consisted of essentially four non-competing parties into the 1960s, operating in every part of the United Kingdom. They were the Conservative and Unionist Party, the [Scottish] Unionist Party, the Ulster Unionist Party (dating effectively from 1905) and the National Liberals. The (Scottish) Unionist Party merged into the English and Welsh party in 1965. The Ulster Unionists stopped taking the Tory whip in 1974 and would leave the Unionist family of parties in 1985. The National Liberals were more important than the independent Liberals between 1950 and 1964, though they petered out in the 1960s. Indeed, in 1951 and 1955 the Liberals returned only six MPs, with 2.5 percent of the vote.
The Conservatives and Unionists were posh parties. The English and Welsh Conservative and Unionist Party was led by the aristocratic Winston Churchill to 1955; by Anthony Eden, from a minor aristocratic family, to 1957; and by Harold Macmillan, married into the grandest of aristocratic families, until 1963. Macmillan was succeeded by a fully titled aristocrat, the 14th Earl of Home, or Sir Alec Douglas-Home, as he became on renouncing his peerage. The ministers in Conservative governments of the 1950s and early 1960s were overwhelmingly public school and Oxbridge educated. Around one-sixth were aristocrats, and fully one-third Etonians.9 The Labour Party, excepting a small part of its leadership, was very different. Those with secondary and university education had, as in the case of the Tories, tended to have been to public schools and Oxbridge. Where Labour differed was that part of its front bench (and most of its MPs), had no secondary or university education. Neither parliamentary party, in other words, had a strong cadre of the emergent grammar school/civic university middle class. Labour was the party of the elementary school, the Tories of the public school.
The Tory Party was also the party of the officer class. In the 1950s, after years of conscription, high warlike expenditure and continuous military operations, the martial virtues were very evident in public life. To have had a good war was an advantage. Many young men who reached high army rank prospered in the party, among them Brigadier Enoch Powell (elected 1950), Colonel Frederick Erroll (elected 1945), and Lieutenant-Colonel Edward Heath (elected 1950). Sidney, Viscount De L’Isle, was a dashing officer who won the VC in Italy. Major Peter Carrington MC, 6th Baron Carrington, was remarkable for holding many ministerial positions from the 1950s to the 1980s, including foreign secretary, entirely from the House of Lords. Major William Whitelaw MC (elected 1955) was to be home secretary and deputy prime minister (and was one of two childless men elevated to hereditary viscountcies by Margaret Thatcher). By contrast, the younger Labour leadership tended to come from men who were dons and wartime civil servants rather than soldiers, for example Hugh Gaitskell, Harold Wilson and Douglas Jay, though many had served as relatively junior officers such as Captain Tony Crosland, Major Denis Healey, Major John Freeman, Captain Roy Jenkins, Squadron Leader Merlyn Rees, Flying Officer Peter Shore, Pilot Officer Anthony Wedgwood Benn and Lieutenant James Callaghan RN.10 In 1953 the Tory cabinet had four former Grenadier Guards officers in it.11
The Tory Party was also without question the party of business. The very great majority of their MPs, when they were not ministers, had serious external interests (unlike most Labour MPs). Only twelve Tory MPs in 1966 had no identifiable remunerative job outside parliament; and some of these were simply retired from such work and others had private income.12 In 1966–7, 243 Tory MPs held 290 positions of chairman, deputy chairman, or managing director of enterprises; and 601 had directorships. The comparable figures for Labour were 32 and 70. While 123 of the 363 Labour MPs had been manual workers, and 99 teachers, the number of Tory former workers or teachers was negligible.13
The businessmen were not just backbenchers. Churchill brought back his own key businessmen from wartime, Woolton, Leathers, Lyttelton and Bennett, into government. Oliver Lyttelton, as colonial secretary, was in charge of Malaya from 1951. He had been chairman of the largest group of tin-mining companies in that territory. Percy Mills of W & T Avery came into his own under Macmillan, as did Frederick Erroll (a Cambridge engineer who served as president of the Board of Trade and minister of power). He was later to be chairman of the papermaker Bowaters and of Consolidated Goldfields. Harold Watkinson, another businessman and engineer, served as minister of defence. Aubrey Jones, an economist who worked in steel, was minister of supply. But perhaps most obviously and importantly, Harold Macmillan was himself a businessman, chairman of the family business, the publishers Macmillan & Co.
From 1965 the party was led by Edward Heath. Very unusually for a Conservative, he spent some time after the war as a civil servant, and as a journalist for the Church Times. From his election in 1950 he was a professional politician. Men from business played important roles in his shadow cabinet in the late 1960s and in government 1970–74. For example, Sir Keith Joseph (of the builders Bovis) spoke on industry and trade in opposition. When Heath came into office in 1970 he brought industrial people into key positions. Robert Carr, an MP since 1950, went to the Department of Employment to introduce the new Industrial Relations Act, a major innovation. Carr was a Cambridge-trained metallurgist and had been head of research and development in his family’s business, John Dale Ltd, makers of non-ferrous tubes and aluminium products. John Davies of BP had been director-general of the Confederation of British Industry and came in as secretary of state for trade and industry. Peter Walker was in finance. Heath brought in Lord Rothschild, of Shell, as head of a new think tank: Rothschild was a man of power – aristocrat, scientist, and former member of the security service.14 There were younger men from business, such as the publisher Michael Heseltine and the engineer Nicholas Ridley of a Tyneside civil engineering firm, Brims and Co.
The contrast with the Labour Party was clear here too. For while it did have its Oxbridge graduates, and men who served as officers in the Second World War, its connections to business were minimal. Labour-affiliated and Labour-funding business people were typically Jewish. The Conservative Party, by contrast, attracted both Jewish and non-Jewish businessmen. Harold Wilson in particular was associated with Lord Kagan (ennobled 1976), who made Gannex raincoats in Huddersfield. Captain Robert Maxwell of Pergamon Press, who later owned the only Labour-supporting paper, the Daily Mirror, was briefly a Labour MP. The main financial experts in the party were Harold Lever, Edmund Dell, Joel Barnett and Robert Sheldon, all businessmen, Jewish and from Manchester.15 They all chaired the Public Accounts Committee; indeed, they were the only Labour MPs to do so between 1970 and 1997. They also all served in the Treasury, while Dell was in addition secretary of state for trade. He had worked for ICI between 1949 and 1963. Other Jewish businessmen/experts on management were Ian Mikardo (who applied his management skills to canvassing, inventing the Reading Pad, named after his constituency), and Austen Albu, an Imperial-College-trained engineer who served as minister of state in the short-lived Department of Economic Affairs in the 1960s.16
THE LABOUR PARTY
The Labour Party was a conservative organization. It was dominated by the right of the party in the House of Commons. Clement Attlee was leader until after the election of 1955; he was succeeded by another public schoolboy and Oxford graduate, Hugh Gaitskell, who was leader until his death in 1963. This leadership was supported by right-wing trade union leaders, who dominated organized labour. Its socialism was muted and concentrated in the ranks of its individual members in the local constituency parties. One way to look at this is that the fundamental aim of the Labour Party has always been extremely modest. It was to get trade unionist and/or workers into parliament, to nationalize the coal mines and related industries, and to obtain a comprehensive welfare state providing a national minimum of what was first called ‘maintenance’. That may indeed have been the limit of its ambitions, leaving it with little more do after 1951.
Yet Labour was a complex coalition of ideas, and the history of these ideas, and of its policies, is not well understood from within the arguments of the factions, which still dominate the histories.17 For example, Hugh Gaitskell came out emphatically and decisively against the Suez adventure (not least because the US was not on board) and was against the Common Market (and in favour of the Commonwealth). Gaitskell thus went against the patriotic-imperialist end of Labour in 1956 and the right-wing pro-Common Market revisionists (and in particular his ideological spear-carriers such as Roy Jenkins). By later standards these stands, and his welfarism, would put Gaitskell at the far left of the party. The Labour right preferred to remember his failed attempt to get rid of the party’s entirely notional commitment to total nationalization by dropping Clause IV of the party’s constitution, and his success in reversing a temporary position of the party (though not the parliamentary party) in favour of nuclear disarmament.
From 1955 to 1983 Labour was led by four men all born between 1906 and 1916. Gaitskell, Wilson and Michael Foot studied at Oxford; Gaitskell and Foot had been to public school. The fourth, James Callaghan, was a white-collar trade unionist. They were representative of Labour’s leadership, though not its MPs. First, these were products of grammar and public schools and overwhelmingly of the (mostly 1930s) University of Oxford: such as Denis Healey, Roy Jenkins, Michael Stewart, Barbara Castle, Harold Wilson, Patrick Gordon Walker, Richard Crossman, Anthony Crosland, Anthony Wedgwood Benn and Michael Foot. Some had taught at Oxford; most, but not all, were on the right of the party. Then there was the trade union officer class: men who rose without university through the ranks of trade union officialdom. These were men such as James Callaghan (tax officers), Ray Gunter (TSSA), George Brown (T&G), Bob Mellish (T&G), Reg Prentice (T&G), Richard Marsh (NUPE), Fred Lee (AUEW), Roy Mason (NUM) and Eric Varley (NUM). Some had served in the war and were typically commissioned, for example James Callaghan, Ray Gunter, Bob Mellish and Reg Prentice. Some had higher education, sponsored by their union or the TUC, such as Roy Mason (LSE), Eric Varley (Ruskin), Richard Marsh (Ruskin) and Reg Prentice (LSE). They were also, with the exception of Fred Lee, on the right of the party. Reg Prentice defected to the Tories in 1977, Richard Marsh who had left politics to run the railways, indicated support for Thatcher in 1978. Mellish resigned in 1982 and joined the government’s London Dockland Development Corporation. Varley left politics and became chairman of Coalite, which owned the Falkland Islands. George Brown was hostile to Labour in the 1970s and joined the Social Democratic Party, formed in 1981.
Among the leadership of the party the left was weak. Aneurin Bevan, a miner and mining union official, was the leader of the left from the 1940s into the 1950s. Thereafter the leadership of the left included a number of figures – Richard Crossman, Barbara Castle and Michael Foot. In the 1970s the left had a new leader, Tony Benn, who as Anthony Wedgwood Benn had inherited Cripps’ Bristol seat. They had much in common. Both were sons of peers appointed for political service, one Liberal, one Unionist. Both were younger sons, but Benn inherited the title because his elder brother had died in the war. Both were independently wealthy, Christians and vegetarians. Both had a particular connection to science and technology, the first as a chemist and patent lawyer, the second as an enthusiast for all sorts of new machines; he was Labour’s modernizing whiz-kid of the 1960s. Stafford Cripps had been Minister of Aircraft Production during the Second World War; Benn ran its much enlarged successor, the Ministry of Technology. The difference was that Cripps moved rapidly to the right after 1939. Benn moved to the left after 1970.
In the general election of 1951 the Labour Party got its highest-ever proportion of the national vote. It lost votes in opposition in 1955 under Attlee, and in 1959 under Gaitskell. There was, even in the 1950s, a thesis that as it became wealthier, and as society became less class conscious, so the self-identifying working-class Labour vote would fall.18 It was an argument designed to shift the position of the Labour Party to the right, reflecting the belief that it was the Conservatives who were more in tune with the times and the likely future. However, the British working-class did not vote Labour by nature, as the argument assumed. Had they done so Labour would have been the majority party since its creation. Labour did far better among the affluent workers of the 1950s than the relatively impoverished workers of the interwar years. Looking forwards, the thesis does not work so well either. Labour was to continue to increase its vote as the working class got richer and smaller: in 1966 Labour got as good a result as in 1945, with 48 per cent of the vote (in 1964 it had been 44 per cent).
On one possible measure, trade union membership, class consciousness increased over time. In the 1950s and early 1960s trade unions hardly grew at all and were dominated by the right. Most of the unions were affiliated to the Labour Party and supported the Labour leadership against the more left-wing constituency membership. The trade unions were there, as before, to represent a largely male industrial workforce, in the private sector and the nationalized industries. From the late 1960s trade unionism grew rapidly, especially among white-collar workers in industry (the Association of Scientific, Technical and Managerial Staffs (ASTMS) grew notably) and in the public sector, bringing many more women into the trade union movement. Instead of members leaving unions as they became middle-class, the middle classes were joining unions! It is not clear then what was going on – were workers joining unions for individualistic rather than collectivist reasons? Was union membership a measure of the collapse of collectivism? What was clear was that, as union membership increased, the Labour vote fell. The Tories returned in 1970 with 46 per cent of the popular vote. In 1974 Labour were the largest party in a hung parliament with 37 per cent in February, with the Tories out-voting them (38 per cent). They won an overall majority in October with 39 per cent. In 1979, the Conservatives won with 44 per cent, with Labour down to 37 percent. Peak trade union membership was in 1979, and the Labour vote was nowhere near its highest.
The central revisionist argument of the 1950s was not about the working class but about capitalism. Revisionists argued that capitalist business had been transformed into an economically creative force, controlled by its managers, not its owners. Anthony Crosland’s Future of Socialism, in 1956 the revisionist text, should really have been called the future of welfare capitalism. Capitalism, even British capitalism, was then seen as successful. Labour, it was argued, no longer needed to transform capitalism, but to tax it and spend in order to achieve greater equality. Fiscal measures could and should replace concerns with ownership. Labour had in fact already given up on nationalization. In 1950 there was quite a list of industries still to be nationalized – sugar, cement, ‘appropriate sections’ of chemicals, ‘all suitable minerals’, water, meat-importing and wholesaling, cold storage and insurance. By Challenge to Britain, a policy programme of 1953, the contenders had shrunk to a few machine-tool firms, some mining machinery firms and any inefficient aircraft establishment. By the 1957 party document Industry and Society nationalization seemed to have gone entirely.19
The logic of the revisionist position became clear in the 1959 Labour manifesto. The Labour programme was now for the first time focused on welfare. The central plank of the welfare programme was a radical reform and upgrading of the National Insurance pension, rejecting the Beveridgean flat-rate scheme. The 1959 manifesto was to be the most welfarist Labour manifesto ever. Practically its only industrial policy was to renationalize steel and long-distance road haulage.20
Hugh Gaitskell died young in 1963 and was replaced by a leader apparently from the centre left, Harold Wilson, the first non-public-school leader since 1935. He won the general election in 1964 with roughly the same vote Gaitskell got in 1959, but a Liberal revival now ate into the Tory vote.21 He won on a very different manifesto than the 1959 one. It was overwhelmingly national-productivist, which was much more representative of Labour manifestos of the past, and of the future too.
In contrast to the earlier revisionist stories, Wilson stressed that British capitalism was deficient – run by gentlemen, financiers, speculators and amateurs. This analysis was attractive to the left, mixing as it did a traditional Liberal-Labour attack on rentiers, with its commitment to technicians and managers. He was very much in tune with national declinism of the time (see chapter 15). Wilson was a more complex and interesting figure than caricatures of him as merely slippery suggest. As we have seen Wilson was hostile to ‘British’ nuclear weapons and the sale of arms to fascists; he wanted to rein back the British military-industrial complex and was against Common Market entry, at least at first. Later the success would be put down to Wilson’s modernizing, white-heat rhetoric, admired for its vacuous futurism rather than for its serious content. By the standards of the 1980s he was a politician of the extreme left – but the left of the 1960s and 1970s did not see him as such.
CONSENSUS?
The social polarization between the two parties pointed to their very different relations to power in economy, society and state. The Conservatives were the party of multiple overlapping elites; the Labour Party that of the organized working class, and some renegades from the elite. The Conservatives were the party connected to the great warfare functions of the state, the Labour Party at best to welfare. The Conservatives also had most of the newspapers, which reached all classes, on their side. The Times, Telegraph, Mail, Express and Sketch were Tory daily papers. The bias towards the Conservatives increased over time. In 1960 the Liberal (but which supported the Labour right) News Chronicle was sold to Lord Rothermere and was absorbed into the Daily Mail, and in 1964 the Daily Herald (the Labour paper) was renamed the Sun and in 1969 sold to Rupert Murdoch, leaving the Mirror as the only Labour-supporting newspaper. Most of the very high-selling Sunday newspapers were Conservative, such as the News of the World (selling 7 million), the Sunday Express, Sunday Mail, Graphic, Empire News and others; the Labour-supporting Sundays were Reynolds News, the Sunday Pictorial and Women’s Sunday Mirror.22
We should, for this reason alone, resist the tendency to discuss politics in the 1940s, 1950s and 1960s in terms of consensus, or the post-war settlement. The concepts came to frame the history of an entire era because from the 1970s historians and others wanted to defend what they took to be the good progressive post-war arrangements, while a minority were critical of it as stultifyingly retrogressive.23 For both the notion of a consensus served their purposes. Consensus embodied a naive claim that what mattered was party politics.
The concept of ‘consensus’ was only partially about whether there was agreement – it is at least as much about what there was supposed to be agreement about. For consensus was defined in relation to very particular issues, most notably those labelled Keynesianism and the welfare state. Yet the increasing welfare of the British people was not due to Keynesianism or to the welfare state. Economic growth, low unemployment and a whole raft of measures and policies were much more important than demand management or the social services. It was also not the case that the welfare state was the central concern of the elite or the government or indeed political parties.
The very notion thus embodied a particular analysis and choice of what was or ought to be considered central to the life of post-war Britain. By centring consensus on Keynesianism and welfare, the argument was that the origins of the consensus or settlement were found on the liberal-left, and that the right therefore had accommodated to their position. It is no mere thesis about post-war agreement, it is a thesis that made particular claims about the character of the whole of politics over the century. Perhaps the richest version is that there was a national consensus, in which the Conservatives were allowed to dominate in questions of national greatness, and Labour was given the welfare state.24 But most accounts ignore the warfare and foreign aspects and assume the centrality of welfare to the state.
What were Keynesianism and the welfare state? ‘Keynesianism’ is taken to mean very different things. Sometimes a very wide definition of Keynesianism was used as a label for all economic policy, including nationalization and sometimes even the welfare state. It has been suggested that Keynesianism even created the concept of a national economy, but this is unconvincing. The idea not only existed before Keynes, but the Keynesian notion of demand management itself depended on the existence of a national economic space. National economies were defined by economic controls at borders, not economic doctrines. Where this argument is helpful is in making clear the significance of the national economy as an analytical and conceptual category which was real and powerful, even if not Keynesian.
Sometimes Keynesianism is defined narrowly, as demand management, in order to argue that because policy was Keynesian in this sense it ignored ‘the supply side’ or did not lead to a ‘developmental state’. But while this was true of many commentaries and histories it was not true of the history itself. Keynesianism as an idea does not capture more than a fraction of what was distinctive about the control of the economy of the long boom. Keynesianism per se had nothing to say about economic nationalism, the development of agriculture, or nationalization, or regional policies, or industrial policy, or indeed the control of prices and incomes (a feature of the entire 1960–79 period, with a 1948–50 incarnation also). To think about the economy as Keynesian or non-Keynesian is to miss the most important policy levers and transformations in the economy.
As an economic doctrine Keynesianism was the idea that managing the total level of demand in the economy was the way in which government managed to generate the historically unprecedented rates of economic growth (well over 2 per cent per annum on average) which were sustained from the war years into the 1970s, with historically low rates of unemployment. Yet even in this quite narrow sense the concept is unhelpful. Demand management was used, but mainly, as in the Second World War, to restrain inflation rather than to promote growth. It was more stop than go, even with Labour in the late 1940s. The notions that Keynesians were inflationists and those opposed to inflation were anti-Keynesian are both false.25 It was not the case that an inherently sluggish economy was brought to life by stimulating demand. Indeed, this point was made by anti-Keynesians, some of whom regarded Keynesianism as the management of the economy and society by too-clever-by-half men with no families, indifferent to the future, who undermined the moral basis of capitalism, a capitalism which was in fact already generating growth and employment despite them.
The repeated invocation of ‘Keynesianism’ does, however, need to be taken seriously. What Keynesianism, and later monetarism, did was to provide a language around government budgets – a particularly visible parliamentary occasion – which dominated reporting, with the language of expansionary or deflationary budgets, reflation and deflation, stop and go, and later the Public Sector Borrowing Requirement and the Medium Term Financial Strategy of the monetarist period. This filtered into histories telling the story of the post-war economy as stop-go, balance of payments crises, sterling taking the strain, inflationary and disinflationary budgets and so on. This was not unimportant, but was only part of the story. Demand management and a sense of how the macro-economy was to be conceived (which did owe something to Keynes) was only one small dimension of economic policy.
The second key concept was that of the newly-created ‘welfare state’. This is of course associated with another liberal political economist, William Beveridge, though he did not use the term. In the standard consensus account a novel, newly large-scale model of welfare provision rested on a new conceptualization of citizenship, born in the Second World War. These assumptions are, as we have seen, very questionable. The welfare state was largely not new, and what was new was not centrally due to Beveridge. In any case, multiple principles were in play. Furthermore, it was not the welfare state which lifted the British people out of poverty, just as it was not Keynesian economics which kept them fully employed from 1940 into the early 1970s.
The term ‘welfare state’, appeared in English for the first time in the 1920s but was not common, or used in its modern sense, until the 1950s. It first appeared in the work of the then Bishop of Manchester, William Temple, in 1928, meaning something like a democratic state which stood in contrast to a ‘power state’. In was also used in this sense by Sir Alfred Zimmern, Montague Burton professor of international relations at the University of Oxford between 1930 and 1944.26 It was utterly disconnected from the ‘social services’ as can be seen from the fact that Temple and others did not use the term when writing about the social services.27 The modern sense – that of extended social services provided by the state – emerged only in the late 1940s, and became established in the 1950s. By 1960 the sociologist of welfare Richard Titmuss wrote of the myth of the welfare state: the idea that the state had indeed got rid of poverty and misery. The welfare state was, for Titmuss and his colleagues, something yet to be achieved. As we have seen, they and the Labour Party came to the view that in order to do this the key Beveridgean ideas needed to be rejected.
Focusing on the idea of the post-war state as a welfare state gets the state very wrong. What was most novel in British public spending in the 1950s was not welfare spending, but high levels of warfare spending. Comparatively speaking, the United Kingdom was a low spender on welfare and a high spender on warfare, in the 1950s and indeed later too.28 If there was a welfare state in post-war Europe it was not most obviously the United Kingdom.
It is in fact very doubtful whether Keynesianism or welfarism were at the centre of politics, let alone state practices. The economy was discussed in terms of exports and imports, investment, planning, production, at least as much as in terms of budget deficits or surpluses. Welfare policy was not the main focus of politics or policy, even rhetorically, even for the Labour Party, as we have seen. The first time Labour had used the term ‘welfare state’ in a manifesto was in 1955. But this is what it said:
In order to strengthen our Welfare State still further and at the same time to play our part in assisting the under-developed areas of the world, our own production must rise every year. Only a government prepared to plan the nation’s resources can do this. Labour will ensure that the claims of investment and modernisation come first.29
The Conservative manifesto of that year paired the welfare state with military expenditure:
In an armed Welfare State the demands on taxable resources cannot be light. This makes it all the more necessary that government, central and local, should be run economically. There are today over 50,000 fewer civil servants and four fewer Ministries than when we took over. Conservatives will persist in the drive for simpler and less expensive administration.30
There was hardly a political consensus about the welfare state either. Policies, and practices, clearly differed between the parties, and both, especially Labour, distanced themselves from the Beveridge programme.
Big differences in approach were evident in economic policy. Stories of ‘Butskellism’ – originally a jokey conflation of the name of R. A. Butler, the Conservative chancellor of the exchequer in the early 1950s, and his shadow, and predecessor, Hugh Gaitskell, grossly exaggerate the degree of agreement between the parties – Labour was much more committed to planning, to economic nationalism, than the more market-oriented, more economically internationalist Conservatives.31 The Tories denationalized steel in the 1950s, and it was renationalized by Labour in the 1960s. The Conservative government introduced ‘commercial’ television in 1955, known as ‘independent television’ to its promoters. It was funded by advertising, on the American model, and was decried as vulgar from the first and for decades to come. The Conservatives allowed large-scale private road transport, a vital change. Labour opposed entry into the Common Market in the early 1960s, under Gaitskell and Wilson, when the government was firmly committed to it. There were also important disagreements on industrial policy in the late 1960s and 1970s. Edward Heath, later held up as the very embodiment of the consensus, was understood in 1970–71 to have decisively broken with the consensus on industrial relations and the role of the state in industry, repealing key bits of interventionist legislation and abolishing whole ministries.32
Where the concept of consensus might be salvaged is in foreign and defence policy. This is an area to which the idea has not generally been applied. Here the key point is that policy was not so much a matter of consensus between parties as the product, not of party politics, but of the state itself. There are indeed striking continuities across administrations which are in part a story of lack of political input. Such consensus as existed in politics here might indeed stem from the fact of relative lack of expertise and engagement with these issues by Labour (that asymmetry again). Furthermore, the Cold War forced the domestic left onto the defensive, it was in important respects a war on the domestic left, whether communist or not. And the left did suffer – in ‘Natopolitan’ culture, as one new left activist called it, it did not have the intellectual impact it had had in the 1930s or the 1940s.33 There is a case for a consensus on defence policy, but not an overwhelming one. There was, as we have seen, a contested politics of the warfare state. It was mostly a matter of parts of the Labour left criticizing a consensus which generally included the Labour leadership (as in the cases of 1950s British rearmament, German rearmament and the H-bomb). But there was dispute over nuclear policy in the early 1960s between the front benches, which is too easily forgotten.
A second area of consensus, with some dissent, was protectionism, the obligation to buy British and the promotion of British technology. Here, too, parliamentary politics was not relevant – a deeper state and administrative culture was in control. These were central features of what has been called Do It Yourself Economics.34 It was essentially economic nationalism, with a very strong dose of techno-nationalism thrown in. We might also call it Listianism, after the nineteenth-century theorist of economic nationalism, or indeed scientific nationalism, as Listianism has been called by analogy with Marx’s scientific socialism. It is difficult indeed to find a textbook of DIYE, by definition, and hard also to find economists who were openly economically nationalist. Thomas Balogh of Oxford, an economic adviser to Harold Wilson in the 1964 government, was perhaps a partial exception in that he was openly in favour of Commonwealth preferences and hostile to the EEC on economic grounds.35
Economic nationalism was an elusive idea, which if did not exist as formal doctrine was nonetheless a fundamental aspect of economic discourse, and clearly of practice. Everyday economic discussion in the 1940s to the 1970s was remarkably focused on the nation, on the balance of payments as a national profit and loss account, on exhortations to export or die, on production, efficiency, productivity, science and that new key word, technology, all in national context.
Thus, while the proponents of the view that there was a consensus tend to focus their attention on ideas from the liberal-left, on which there was in fact little consensus, we find a very different picture. The issues on which there was a greater measure of consensus – the warfare state and protection – were historically policies not of the liberal-left, but rather the right and of the state. Post-war Labour came to accept protection, conscription and a measure of imperialism, the long-established policies of the Tories. It is rather telling that Harold Wilson so liked the popular historian Arthur Bryant, a national-imperialist protectionist of the 1930s, knighted by the Conservatives in 1954, that he raised him to the Companionship of Honour in the 1960s.
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