The UK’s Return to Socialism

What ever happened to liberal Britain?

In Britain today, the economy is booming. Employment is up, growth is up, public spending is down, and the head of the International Monetary Fund has praised the country’s policies as “obviously working.” The secret to Britain’s success? Thirty years of generally liberal economic policies (liberal in the libertarian sense).

That might be about to come to an end, following the general election in May.

Despite the good economic news, Britons are unhappy. The liberal consensus may be breaking down. If so, it won’t be the first time it’s happened. And we’ve seen the dire results.

In 1935, the journalist George Dangerfield wrote a timeless account of the collapse of the British Liberal Party. The Strange Death of Liberal England chronicled how the 19th-century classical-liberal consensus buckled and broke under a series of pressures, from aristocratic reaction through uprisings in Ireland to the rise of the suffragette and labor movements. The Liberal Party went from being the natural party of government in the Edwardian era to being almost wiped out by the 1930s.

Not so long ago, it looked as if Britain’s 19th-century liberal tradition had made a triumphant return. Prime Minister Margaret Thatcher’s strong embrace of economic liberalism had been accepted by her spiritual successor, Tony Blair, who added social liberalism to the mix. Dangerfield’s description of the archetypal liberal (except for the religious elements) could have applied to any number of British members of Parliament, even those who supported Blair in the Iraq War:

He believed in freedom, free trade, progress and the Seventh Commandment. He also believed in reform. He was strongly in favor of peace — that is to say, he likes his wars to be fought at a distance and, if possible, in the name of God.

Indeed, challenging Blair’s successor, Gordon Brown, in the last general election in 2010 were three parties who were unabashedly liberal in one way or another: the Conservatives, who had even adopted social liberalism under their leader, David Cameron; the Liberal Democrats, led by classical liberal “Orange Booker” Nick Clegg; and the UK Independence Party (UKIP), which described itself in its constitution as “libertarian.” And, as mentioned, the Labour Party itself looked eerily similar to the Edwardian liberals.

Five years later, most of that has gone away.

The Labour Party’s current leader, Ed Miliband, has claimed he will “bring socialism back to Britain.” The Liberal Democrats are campaigning as social democrats, but are polling so low they will likely lose many of their members of Parliament. UKIP retains some libertarian policies, but has campaigned strongly on immigration restrictions and on maintaining the status quo on the British versions of social security and socialized health care provision. The Greens have broken out of fringe status and are advocating an avowedly statist “new paradigm for economics.” Finally, the Scottish National Party (SNP), following its narrow defeat in the Scottish independence referendum, threatens to sweep most of the UK Parliament seats in Scotland, on a platform more socialist than the Labour Party’s.

The Conservatives, to their credit, point to their record of success in cutting public spending and allowing the economy to recover from the financial crisis. They are also moving slowly toward a version of a negative income tax and more freedom in education. Yet, they are also advocating more intrusive surveillance powers for police and stricter immigration rules. All told, however, they are probably the most liberal party of the bunch.

They are not going to win a majority, according to current polls. Nor are they likely to recreate their coalition with the Liberal Democrats. In all probability, the next government will be a Labour-Liberal Democrat coalition, held together under “confidence and supply” rules, that goes along with SNP policies where necessary. The likely result, at best, is a more European-style social democratic government, with an added dash of class warfare and Keynesianism.

So what happened?

The current coalition came to power after the financial crisis, and the pressures from that crisis have been alleviated. The Iraq War is long in the past. There are no comparable cultural movements like the labor movement to account for Britons’ dour mood.

Here is one theory. Even after the political collapse of liberalism 100 years ago, private companies continued to promote liberal virtues. When faced with the existential threat of nationalization, they formed groups like Aims of Industry to argue for the virtues of free enterprise. Together with groups like the Institute of Economic Affairs, industry and advocates both backed politicians who called for a return to liberal policies. They finally succeeded in 1979, with the election of Thatcher.

Industry has now withdrawn from that fight. Aims of Industry closed down in the 1990s. Few business leaders today stand up and promote the liberal virtues as good and moral. To be sure, businesses are involved in the political battle, but few actively promote a genuine philosophy of freedom while meeting the challenges of crony capitalism and cradle-to-grave welfarism head on. But that philosophical engagement is crucial.

Liberalism is not a simple political choice. It is a way of life. Businesses are the lifeblood of a liberal economy, but they are much more than that. They also produce the antibodies that help entrepreneurs ward off socialism and other forms of political predation. CEOs who abandon that role — by, for example, promoting their environmental awareness rather than their role in providing jobs and the goods and services that people want and need — have fallen into a trap where their actual economic function is seen as secondary to whatever external costs they admit to imposing on the commons. (Granted, not all have fallen into this trap, but much of big business has.)

That philosophical neglect has led to a shift in political discourse. “Thatcherism” and “Blairism,” once widely perceived as needed jolts that shook Britain of its doldrums, are now seen as licenses for private companies to do bad things. For example, when business leaders speak up for more immigration, much of the general public see it as a desire to fatten their bottom line by bringing in low-cost workers at the expense of the domestic working class.

By abdicating their philosophical role, British business leaders ceded that ground primarily to their enemies. Liberal Britain survived the death of the Liberal Party. It may not survive the death of liberal business leadership.

Related Articles

{{relArticle.title}}

{{relArticle.author}} - {{relArticle.pub_date | date : 'MMMM dd, yyyy'}} {{relArticle.author}} - {{relArticle.pub_date | date : 'MMMM dd, yyyy'}}
{{article.Topic.Topic}} {{article.Topic.Topic}}

{{article.Title}}

{{article.BodyText}}