The Caught In The Act Column from the June 1990 issue of the Socialist Standard
There are few more repulsive sights than local Tory activists exulting in an election victory, especially when this happens in the small hours of the morning when everyone else wants to go home to bed. Thus it was in Ealing, a local election result which the Labour Party could not explain in any way other than their own unpopularity. It seems that, in spite of everything that has happened since to give the Labour council confidence that they would be re-elected, the voters in Ealing had not forgotten the steep increases in rates which Labour imposed. Their misguided outrage at this was titillated by bloodcurdling stories about lavish council expenditure on bizarre lame-duck minorities and the creation of a lot of lucrative non-jobs for the boys and girls in the party. Nevertheless the Labour Party did not expect to lose Ealing; as Bryan Gould said in the stunned aftermath of the Tory victory, they thought they did not deserve to lose there.
If that means anything it is that in Ealing the Labour council had industriously applied itself to shedding the loony-left tag which it acquired in 1986 and had become a model of Kinnockist moderation—appropriately enough since it is the borough where the Labour leader lives in surprisingly modest style for someone who sees himself as a future prime minister. Labour's transformation did not please everyone and there were some well-publicised rows over the economies which the council imposed just before the election, involving councillors who were under the delusion that Labour administrations should act differently from those run by Tories. If the Labour Party did not "deserve" to lose Ealing it could only have been because they had done such a good job of disguising themselves as Tories. After all that effort to obliterate the differences between the two parties how could the voters be so ungrateful as to choose between them?
Lunching in the City
The Ealing result was ominous for the Labour Party because the council there had done what the party nationally is doing. Ever since their defeat in 1987 Labour has been trying to make itself as similar to the Tories as it reasonably can. At its conferences Kinnock still addresses the delegates as "comrades" but his preoccupation is to persuade the voters that Labour is a party whose claim to their support is based on their promise to run capitalism more efficiently than the Tories have managed to.
In the forefront of this tendency is the man who hopes to be Labour's Chancellor of the Exchequer and who, to prepare himself for this, has been industriously lunching his way around the City of London. John Smith is a very caricature of sober restraint; even his voice, with its austere Scottish rasp, promises a hard-headed prudence. He gives no hope to the most naive of Labour supporters that his visits to the City are to give notice, over the claret, to the bankers and stockbrokers that with a Labour government and its policies of common ownership their days are numbered. What he is actually doing is reassuring them that when he is installed at the Treasury their interests will be his first concern; “The first and overriding priority of a Labour government will be to put the economy right, so we may have to ask for patience from people" was how he put it on TV recently.
The "people" he had in mind were not the investors who infest the City but those on a rather lower income, who misguidedly think that a Labour government's priority will be to spend money on their welfare. They have no excuse for this, for Smith has held consistently to his line. Last October he warned that as Chancellor he may need . . . to postpone some of our social ambitions ." In April in New York he was soothing Wall Street with the assurance that “. . . there will be no dash for growth under the next Labour government" and last month he was repeating the same doleful message given out by every Labour Chancellor, that if the unions press for "excessive" wage rises they will be causing unemployment.
And how does the City react to the presence in their midst of this dangerous radical from across the border, eating their food, drinking their wine and talking their language that profits come first? Well, they are by no means alarmed or even uncomfortable. The Economist reported that City analysts are widely reassured that a Labour government would be no worse (for them, that is) than the Tories. The Investors Chronicle, which does not exist to promote the cause of social revolution, concluded that Labour's economic policy ". . . contains nothing to which the City objects violently on principle .
In fact it is difficult to understand the belief that a Labour government will always include a reckless and incompetent Chancellor, especially when we remember that recent Conservative holders of that office have included Anthony Barber. Derek Heathcoat Amory, Selwyn Lloyd, Reginald Maudling and Nigel Lawson. When we compare these with Labour Chancellors like Stafford Cripps, Hugh Gaitskell, James Callaghan, Roy Jenkins and Denis Healey and consider how their anti-working class policies protected the interests of the capitalists we can only wonder why the City does not immediately and unreservedly welcome a Labour government. Can it be that the Square Mile is populated by people so exceedingly ungrateful that they would not recognise a profit-protective Chancellor if one was served up on—well, on their lunch plates?
Consider too what has happened in the past—the efforts of Labour ministers to convince the British capitalist class that they had nothing to fear from a Labour government and how this message was received. In 1965 George Brown said in the Director, the magazine of the Institute of Directors, that "businessmen have more hope of making progress and money under a Labour government than they had before” In 1969 Frank Kearton. who was then chairman of Courtaulds. told the Institute of Public Relations that "some of the (Labour] government s measures will stand industry in good stead in the seventies'. More recently, in 1987 Lord Donaghue. head of research at stockbrokers Kleinwort Benson, had this to say about the result of the general election which was expected that year: " . . . the
reality is that all parties in this country support a mixed economy and none has policies so radical as to be damaging to long-term investment prospects". The noble lord's research had obviously not unearthed the presence of the Socialist Party and its policies, but let that pass.
So there is nothing new in Labour s present reshaping of its policies and its image, trying to smooth out those inconvenient doctrinaire lumps of nationalisation and "soak the rich" hysteria which were meaningless but which upset the City when all the Labour leaders wanted was to have friendly lunches with them while they got down to the serious business of organising the maximum exploitation of the working class. What is new is the faces; a new generation of Labour leaders has risen since Thatcher first marched triumphantly into Number Ten and they are letting it be known on which side of the class barricade they stand. On those terms John Smith is a comforting figure and workers who are nervous about how rich, how competitive and how secure are the class who exploit them may vote for him to compose the budget of British capitalism while he tells the workers how their greed and indolence are ruining the profitability of the British economy.
Smith now promises to do the kind of balancing act which former Labour Chancellors found impossible, in spite of their promises before they got into power. He says he will energise British industry into prosperity, encouraging steady expansion while controlling any tendency to a boom in which pay claims may become too powerful. At the same time he will prudently invest in education, health care, social services and our general welfare. He makes it sound very easy and reassuring, except to those who remember what happened to the same promises made by other Labour Chancellors.
History gives no support to John Smith nor to those who are dazzled into supporting him. It is not a matter of incompetence; many of the abject, discredited failures competently tried to do the impossible—to make capitalism behave as if it were a benign and controllable social system. John Smith will not be pondering these facts as he chews his way through his lunches, for they would not stimulate the appetite of an office-hungry politician.