New Labour’s “Pepsi Challenge”

The social democratic consensus is unhealthy and complacent

by Christopher G. D. Tipper <chris.tipper@hotmail.co.uk>

THE BBC ran a feature on Newsnight last night where they stopped people in a shopping centre and showed them policy statements made by the Conservative Party and New Labour. The statements were so indistinguishable that most participants picked the wrong party, and we now have the 21^st Century equivalent of the “Pepsi Challenge”. [1] Politics these days seems to have room for only one brand, and the forthcoming General Election is shaping up to be a dirty war with vast amounts of grape-shot, smoke, lies and evasions; the winning Party being the most skilled at the trench warfare of modern political campaigning. Hitherto New Labour have proven the best shots.

Newsnight also provided the spectacle a few weeks ago of a youngish reporter shopping around for a politician to support his distinctly old-fashioned style of Socialism. More than one of his distinguished interviewees told him that he should get a grip, as the world had moved on since the abandonment of Labour’s nationalising Clause 4. The reporter was left bleating rather pathetically that there was nobody for him to vote for any more. Ideology is dead and social democracy has won.

It is interesting to ask how this consensus has come about. After the blitz of privatisation in the 1980’s, deregulation of financial services, and indeed the collapse of Communism in the U.S.S.R., it seemed that an altogether distinct political settlement in favour of free markets and private enterprise had been reached. Labour abandoned its goal of the state owning the means of production and a shiny new leader in the form of Tony Blair leapt upon the stage, promising to take the revolution forward, by seeking a nation with equal opportunity for all and fighting for ‘social justice’, bolstering the rights of those who had been left behind by the ‘greed’ of the Thatcher era.

So the Blair solution, the so-called ‘Third Way’, has become the new orthodoxy. It is accepted implicitly that the government should provide universal healthcare and education, and it is accepted implicitly that workers rights should be bolstered against the power of big business. Gordon Brown talks a lot of guff about entrepreneurship and free-trade, but in practise New Labour has chosen the stick of legislation and fiat to the carrot of tax incentives, liberalisation and deregulation. If people will not act in their own best interests, then the government stands ready to bully and cajole them into doing what is only good for them. And meanwhile a flurry of tax-raising powers have been invoked to pay for New Labour's grandiose plans for healthcare and education. To keep the old-Labour rebels on side mini class-wars have been undertaken against beleaguered minorities such as fox hunters and peers of the realm.

All this has not really been very surprising, given the Socialist heritage of New Labour. The bigger mystery is why the main opposition Party, the Conservatives, have proven incapable of sustaining a meaningful challenge to the status-quo. On the biggest ticket spending items, education and healthcare, the issues are so complex that very few people would countenance any truly far-sighted reform, such as devolution of revenue raising powers or even privatisation. The Conservatives have a rather timid scheme of vouchers for primary and secondary education, but fear the consequences of calling into doubt the competence of politicians to run schools. On healthcare they plan to match the Governments’ spending plans, re-balancing accounts to improve efficiency. The core principle of nationalised healthcare remains unquestioned. Nobody considers the benefits to financial controls of separating the insurance function from service provision. And politicians know that if there ever was a crisis where people were dying and the government were still paying the bills, they themselves would still be asked to fall on their sword and accept liability. Much better to be in the driving seat, and make sure that somebody else’s head rolls in a crisis.

On other issues, such as the massive increase in the use of targets, increasingly centralised government and the rapid re-regulation of the British economy, nobody really knows where the Conservatives stand. One suspects that their hands are tied, as they know that this is how politicians effect change. Politicians act through the arms of the Civil Servants around them, and more power means more control, thus inflating the bureaucracy’s headcount. One suspects that New Labour’s hiring binge, with over 250,000 new civil servants between 2001 and 2004, would have occurred even if there had been a Tory government in office. Smoking is a net drain on health service budgets, so even a right-of-centre politician would acknowledge the benefits of hiring a small army of smoking cessation counsellors. Making smokers pay for their own healthcare by hypothecating tobacco taxes just doesn’t have the right amount of power and prestige associated with it.

So while there are differences of style and presentation between the two main parties of Government, in practise they are fighting over the same turf, the centre ground of politics, the place the majority of voters live. There is no room for minority opinions, to the right or the left. Barring a major sea change in the views of an overwhelmingly affluent and possibly complacent electorate, that is the way the chips have fallen after the Thatcher revolution. Only a vigorous economic shock seems likely to upset the status quo. Either that, or a right-wing challenger with the cojones of a George W. Bush and the personality of Tony Blair. He’s probably making a fortune in banking as we speak. The real question is do politicians hold the power or have the markets won? Talent usually follows the glory.

Endnotes:

[1] Remember this promotion a few years back where members of the public were encouraged to taste unlabelled samples of cola drink and identify it as Pepsi or Coke. Many people were caught out picking Pepsi, and the drinks were practically indistinguishable. This writer still professes to prefer Coke.