A Party in Search of a Purpose

BEFORE THE CONFERENCE

By DESMOND DONNELLY, MP

'I should like to ask my right honourable and honourable friends where they are going? [ttoN. MEMBERS: Where are you going?] Where am I going? I am where I always was. Those who live their lives in mountainous and rugged countries are always afraid of avalanches, and they know that avalanches start from the movement of a very small stone. . . . The pebble starts, but nobody bothers about the pebble until it gains way, and soon the whole valley is overwhelmed. That is the logic of the present situation. . . . Why, therefore, has it been done in this way?'

ICAN see the scene as I write. It was Aneurin Bevan's resignation speech on April 23, 1951. The question he posed, and his analogy, agitates the thinking of even the most loyal delegate travelling to Brighton this weekend. There will have to be crucial choices this coming winter.

( First in the field, Mr Richard Crossman has now emerged with his own 'road to Socialism' in his famous Coventry speech. In substance, his view is that it has proved impossible to manage a mixed economy by a free market, either in _goods or in labour. Therefore, so he argues, the free market has to be replaced by physical controls, of which the Prices and Incomes Act is only the first.

Mr Crossman has been assailed vehemently by a section of the so-called left for his speech. The 'left' case against Mr Crossman—and it has considerable support from right-wing trade unionists as well—is broadly that it is wrong to impose restrictions upon labour whilst by far the largest part of the economy remains in capitalist hands. Yet Mr Crossman could easily confound his ex-Bevanite critics by quoting again from Bevan's same speech: 'The great difficulty with the Treasury is that they think they move men about when they move pieces of paper. It is what I have described over and over again as "whistle blowing" planning. It is perfectly obvious that there are too many economists ad- vising. . . .' That was the Bevanite argument for physical controls and against Mr Wilson's policies.

Nevertheless, is there substance in the chal- lenge to Mr Crossman's (and Bevan's) view- point? Where could his thinking lead? Has it parallels? It is clear that the Prices and Incomes Act would soon have to be followed by selec- tive import controls. The logic of limiting imports could lead rapidly to a call for a restriction on home-produced goods being sold on the home market. Yet these are relatively minor issues compared with the fundamental principle of a free trade union movement. The right of freedom of association—with its corollaries, freedom to represent and to bargain —goes to the roots of free society itself.

Restrictions on the position of the trade union movement have long been the pattern of life within the Communist countries. Yet there is another parallel to the logical development of Mr Crossman's idea as he has thrown it out. We have to remember that Mussolini began as a left-wing socialist who won power by suc- cessful protest against the ineffective Italian government of the day. Mussolini, after he found himself in office, soon discovered that he could not 'run a capitalist economy through the mechanism of the free market.' Therefore, he introduced physical controls, including controls on trade unions. Where capitalism failed in this situation, the state moved in. Mussolini's IRI was the prototype of the British IRC, as has been stated already. Mr Crossman, instead of 'blundering into socialism,' could easily be blundering into the corporate state.

Does this mean that I foresee Mr Wilson marching steadily along Mussolini's road? Will he end up by reclaiming the Wash instead of the Pontine Marshes? Will he earn his place in history by getting British Railways to run on time? And, to complete the analogy, has Mr Wilson also got his own African military venture to restore his prestige, in the background of his thinking? The answer to all this is : Nonsense. But the question remains : Where is the Labour party going? What actually happens when the thaw comes? Will the background of several hundred thousand unemployed act as the great deterrent to the accumulation of wage claims? If there is insufficient unemployment to change the climate of free bargaining, how does the nation meet the avalanche?

Before the question can be answered it is essen- tial to survey the recent course of events. The last year and a half of Conservative govern- ment, since the Brussels fiasco of 1963, and the first two years of Labour government, have one thing in common. The government of the day had no basic strategy. It did its best, in the meanwhile, to keep the populace 'happy.'

In addition, neither government had any clear concept of how to tackle the problem of the stagnant British economy without the stimulus of British entry into the Common Market. Mr Wilson claimed to know the answer and was rescued politically by the smallness of the 1964 Labour majority_ Unfortunately for him, how- ever, the 1966 result paradoxically exposed his true policy or lack of it. He still believes that activity is a substitute for action—witness this week's National Productivity Conference.

What, then, should Mr Wilson do? The Government, if it is to govern, has to have a collective policy. These are times also in which the existence of a collective policy is not enough. The whole Cabinet must know the policy and must be prepared to carry it out. It is a

devastating fact that none of these critical tests, if applied to Mr Wilson's current administra- tion, can be answered in the affirmative.

What would I do, if I were responsible for our affairs? My first answer is that we must affirm that the focal point of British national strategy from now on must be membership of the Common Market. There can be no evading this issue, with all its implications, if Britain is not to go into long-term decline. However, I recog- nise that British entry into the Community may take a longer period than is realised generally. The real issue is our course of action in the meanwhile.

There should be a crash programme of con- tingency planning for the thaw, beginning now. The basic objective has to be the gradual creation of a British society that encourages the twin concepts of economic growth and social responsibility.

In the long term, there has to be a rethinking of the pattern of our welfare state. Mr Kenneth Robinson, for example, almost daily gives a con- vincing public performance of. a man who has not thought a new thought for a decade and who has arrived miraculously into the year of 1966 by courtesy of H. G. Wells. Yet it is monstrously unfair to blame him personally. He is the victim of a much wider intellectual atrophy about the welfare state that will strangle the Labour party if the disease is not cured. In substance, we want better welfare —and less of it. Only in this way can we rationalise the overgrown system - and prevent the burden of taxation crippling all initiative by the early 1970s. There has to be a redistribu- tion—and, in certain cases, a drastic reduction —of moneys administered by the chief welfare ministries and their local authority agencies.

There must be a new approach to the en- couragement of industrial expansion. The current situation offers almost every deterrent that is con- ceivable. Planning permissions are always tardy. The problems of the building industry are visited upon almost every would-be developer like the trials of Job. And then, when the new factory is completed, there are problems of manning it. Finally, there has to be a profit—a large profit —to pay for the venture.

The necessity for profits in an industrial society is something that has yet to penetrate the thinking of a large section of the Labour government. Labour has to get a new attitude towards profits, as Sir Harry Douglass indicated at Lancaster House this week. In short, our pro- cedures, customs and prejudices are often at variance with economic realities. - The recent sad story of the American-owned engineering firm in West London which has announced closure is a salutary case in point. Mr Callaghan's reforming zeal at the Treasury is another. He is wrongly, and to the national detriment, compelling the management of every responsible company in the country to devote an undue proportion of its effort to meeting the new tax structures to the exclusion of other problems. Again, nobody really objects to paying essential taxes, but the conditions must exist that enable people to pay them.

The second vital item for preparation is the redeployment of the British labour force. The word 'redeployment' is merely a pious hope at the moment. The pitiful situation in which we have only thirty-one training centres with 6,000 places must be changed out of all recognition by the spring. The current method of allocating local authority houses was all right for the last few months of 1945, when men were returning home from the war. It has very little to do with 1966.

There will be considerable unemployment this winter. It is also likely to deter many of the pressures of wage demands in early 1967. The real action to be taken, therefore, is to prepare effectively for the thaw by learning the lessons of the immediate past. In addition, much more effective use of Mr Aubrey Jones's Prices and Incomes Board can be made than hitherto.

Two other thoughts arise. First, there is not one senior member of Mr Wilson's administra- tion with managerial experience at a high level in British industry. Nor has any member dis- played forward thinking along the lines I have indicated. Mr George Brown got the nearest to it before he was moved. Mr Gunter also knows

what is right, but he is too often thwarted. Secondly, where are the former Gaitskellites in the present situation? The argument between a mixed (and expanding) economy on the one hand and a restrictionist and restrictive system of con- trols on the other is the modern repetition of the earlier Clause 4 dispute. Apart from Mr Brown, several members of the present Cabinet sup- ported Mr Gaitskell. They included Mr Roy Jenkins and Mr Anthony Crosland. They cannot allow themselves to become immersed in the relatively less important issues of penal reform and comprehensive education to the exclusion of the major arguments of the day. Otherwise the avalanche will start from the movement of a very small stone. The Labour party could lose the next election.