The era of Labour hegemony is over. How should we assess its legacy? It is conventional these days to disparage the record of Labour in government over the past 13 years. Even quite supportive observers tend to argue that little of substance has been achieved. For the more swingeing critics, Labour in power — Labour as New Labour — has been more than a disappointment; it has been a disaster. The party led an onslaught on civil liberties, betrayed leftist ideals, failed to make any impact on inequality and, worst of all, embarked upon a calamitous war in Iraq.
New Labour promised a New Dawn and many feel betrayed. I'm not without sympathy for these criticisms. Yet one can mount a robust defence of many of Labour's core policies, and a balanced assessment is needed if an effective future path is to be charted.
Labour managed to stay in power longer than any other left-of-centre party in recent times.
"New Labour" was not an empty sound bite, designed to cover up for policy vacuity. On the contrary, there was from the outset a compelling diagnosis of why innovation in left-of-centre politics was needed, coupled to a clear policy agenda.
In outline it ran as follows: The values of the left — solidarity, reducing inequalities, protection of the vulnerable, coupled to a belief in the key role of active government in pursuing them — remained intact, but policies designed to pursue these ends had to shift radically because of the profound changes going on in the wider society.
Such changes included intensifying globalisation, the development of a postindustrial or service economy and, in an Information Age, the emergence of a more voluble and combative citizenry.
Most of Labour's policy prescriptions followed from this analysis. The era of Keynesian demand management, linked to state direction of economic enterprise, was over. A different relationship of government to business had to be established, recognizing the key role of enterprise in wealth creation and the limits of state power.
To win elections henceforth, a left-of-centre party had to reach a much wider set of voters, including those who had never endorsed the party in the past. Labour could no longer be a class-based party. In Tony Blair, not a Labour tribalist by any description, the party seemed to have found the perfect leader to help further this aim.
An important strand of New Labour policy was this: Do not allow any issues to be "owned" by the political right — instead, seek to provide left-of-centre solutions to them.
But Labour's record is distinctly patchy, but it would be difficult to deny that it has had far more impact than any of the other centre-left governments mentioned above did in their respective societies. I summarise only very briefly here.
The UK enjoyed 10 years of unbroken economic growth, not to be dismissed as simply based upon a housing and credit bubble. That growth took place together with the introduction of a national minimum wage. Overall economic inequality was contained, although not significantly reduced. The position of the poor, however, improved substantially.
In foreign policy, overseas aid was increased well beyond anything preceding Tory governments had managed. The military interventions in Bosnia, Kosovo and Sierra Leone were widely regarded as successes. If only he had stopped there! Nothing corroded Blair's reputation more than his ill-starred decision to become George W. Bush's main partner in the invasion of Iraq.
A different world today
Along came the global financial crisis, foreseen by very few, if anyone. It seemed to put an abrupt end to the world that was the backdrop to the evolution of New Labour. Suddenly Keynesianism and government economic intervention are back; not only can we seek to regulate financial markets but we must also do so; severe spending cuts dominate the domestic agenda, the opposite of the expanding social investment upon which New Labour policy was built; fiscal prudence has ceded place to massive borrowing and very large accumulated debt; a tax on world financial transactions, previously dismissed as unrealistic, is now on the cards; it is, after all, possible to elevate the tax rates of the rich; there is talk among all the main parties of a return to active industrial policy and of a renaissance of manufacture; climate change and other environmental risks, which Labour did little to confront until late on, now intrude into the heart of mainstream political concerns; planning, for years in the shadows, is once more on the agenda.
New Labour as such is dead, and it is surely time to abandon the term itself. Yet some of the core social and economic trends to which it was a response are still in place and significant parts of its policy framework remain relevant.
Fundamental rethinking is needed and a fresh set of policies has to be created. The key problem for Labour out of power will be to minimise the internal squabbling that afflicts so many parties, especially on the left, following an election defeat. Ideological reconstruction could have a decisive role here.
The starting point should be to redefine the role of the public sphere. "Blairites," it could be said, leaned more toward the market than "Brownites", who were keener on the state.
However, the public sphere is distinguishable both from markets and the state, and can be used as a platform for reconstructing both. A groping towards this notion appeared in Labour's attempts, following the financial crisis, to reintroduce the idea of mutualism into political debate. These rather primitive efforts should be further developed and applied to the task of constructing a form of responsible capitalism, coupled to a sophisticated approach to issues of sustainability.
Anthony Giddens, former director of the London School of Economics, was the intellectual guru behind New Labour's "Third Way" that brought Tony Blair to power.
