Widening the agenda
Jo Grtmond
The Liberal and Social Democratic parties have now issued a joint Statement of Principles, carrying their collaboration to a new stage. They must now set about producing a joint policy. I do not believe that policy statements will necessarily win them votes over the next few years (they might actually lose them some). But over the longer period, and for the well-being of the country, these policies will be important. They must therefore get their diagnosis of our condition right and be clear as to what principles they want to apply to it.
The Statement of Principles says that we are in crisis. I doubt it. A crisis suggests something short and sharp. I fear rather that we are in a process of long-term decline. The document goes on to say that this crisis is the product of four deep-seated evils. It is about the first of these evils that I have my most serious doubts. The document describes this evil as follows: 'The intolerant dogmatism of the two old parties has produced uniquely damaging switches in economic policy.' Pause there. If you read the reports of what Mrs Thatcher and Mr Callaghan have said on occasion, you might get an impression of `intolerant dogmatism', though even if you pick out the most abrasive patches, as the newspapers do, you Will find that by historical standards the invective is not very vicious. Indeed there is a case for saying that British politics suffer from a shortfall rather than a surfeit of dogmatism. But whatever the two parties say, what they do is strangely similar. The howls about 'sadistic monetarism' sound rather thin against the background of current public expendi ture and Tory beneficence to the nationalised industries. The trouble to my mind is that the two old parties are too much alike in what they do. The Labour Party is wedded to state socialism and the Conservative Party has found no method of divorce. It has done nothing to change the structure of our affairs, which is predominantly a state socialist structure.
The document goes on: 'Instead of concentrating on making the mixed economy work, each new government has been obsessed with changing the boundaries between the public and private sectors.' Apart from a steady increase in the general involvement of governments in industry through subsidies etc, there has not been much change recently in the boundaries between the public and private sectors. The crux of the difficulty is that the mixed economy cannot work with the present nationalised industries. They need to be re-examined; those which we want to retain as social services treated as such, others handed over to their workers, othels still denationalised, and all those which are to be treated as genuine industries submitted to laws of the market. This section on the first of the evils of our day, finishes by stating that the situation described above 'has ruinous consequences for long-term planning'. I have little faith in long-term planning; what I would like to see is better short-term planning and more use of the market as a planning instrument.
The document goes on to describe us as a 'class-divided society', soured by the class war, This is in some respects true, but to my mind our trouble is that the old classes have lost their cohesion, standards and devotion to principle and we have put nothing in their place.
An incomes policy is not directly mentioned but it may prove the most distinctive policy of the alliance. It is referred to as 'an agreed strategy for incomes'. Agreed by whom? you might ask. But before agree ment is even sought Liberals at least should ask a number of questions. The right of a man or woman to sell his labour for what he can get, is something for which Liberals have long fought. It may have to go. If the economy is bedevilled by monopoliesand restrictive practices on all sides, including the trade union side, then some statutory incomes policy may be a necessity. But it would be a sad necessity brought on by the unmanageable size of the public sector and the failure of monetary management. If, however, the authors can generate a common purpose in the nation, which is rightly one of their aims, the need for an incomes policy will diminish.
The document, which is blissfully short, understandably does not mention these matters, but they are important. Before we accept the need for an incomes policy we should attempt to remove the blemishes which appear to make it essential. A very obvious evil of our society is the application of poultices instead of applying surgery to the offending limb. If an incomes policy is necessary is it to be permanent? As to its nature, several economists such as Sir James Meade and Professor Phelps Brown have made useful suggestions, but the difficulties remain enormous and will not be solved until the politicians have cleared their minds as to what they hope to achieve by it. Is it a holding operation? Is it to cure inflation (if so, no increase in total earnings should be made)? Or is it a means of redistributing earnings in an attempt to achieve a 'fairer society'? Are strikes against its application, therefore, to be made illegal?
This document is admirable in many respects and is not to be blamed for its lack of detail nor for its failure to cover the whole ground, though some omissions for example, education — may give trouble. But to me it leaves open the question as to whether its authors are searching for a middle ground — a reformed and diluted variety of etatism, a mixed economy in which the mixture is to be much as now (which may be popular); or whether they intend to strike out for a new highly decentralised political economy with drastic changes in our methods of running industry, competition, workers' ownership, and so on; in fact a total alternative to state socialism.
What is authors have done, and done most admirably, is to widen the agenda of politics. As part of their new and welcome approach they have said that they want to broaden discussion and submit their ideas to constructive criticism from all sympathetic quarters. To this offer I hope the readers of the Spectator will respond.
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