The Radical Party is a democratic, left of centre party. Its mission is to define and promote a new vision of a genuinely democratic, tolerant, egalitarian, socially just and outward-looking society and so create a coherent and realistic alternative to the neo-conservativism, which has dominated British politics for the last four decades.
The poverty and inequality in Britain today are not a result of the laws of economics but of failure to reform a deeply flawed political system, which has side-lined the electorate and handed control to lobbyists, self-seeking party donors and billionaire newspaper proprietors.
The key issue is not that a few rich people have far more money than they need but that our laws permit them to avoid paying taxes which they ought to pay and to buy things that should not be up for sale: political influence, control of information and privileged access to justice, education and jobs, which embed inequality and blight the lives of many of those who are not so fortunate.
The Party rejects both the short-sighted, self-serving of neo-conservatitive capitalism and the nostalgia of old-style socialism, which has kept the Conservatives in power for most of the last sixty years. It seeks to create an enduring basis for equality and prosperity through constitutional reform, evidence-based policy making, and the creation of a modern, dynamic, plural, social market economy of the kind which has proved an enduring success in other Northern European democracies.
The public want greater equality, good jobs, a strong NHS and excellent schools. But they also want security and understand that welfare demands sound public finance. We seek:
- a new vision focused on ending poverty and building an ethical, cohesive, dynamic, productive and more equal society by enabling people from all walks of life to play an active role in decision-taking;
- open and honest discussion of complex issues such as debt, migration, electoral reform, lobbying and donor funding, the long term implications of Brexit, defence, climate change and energy security;
- every-vote-counts elections; high governance standards in Parliament; and evidence-based policy, to take power back from vested interests and lobbyists, whose covert influence perverts our democracy;
- sustainable economic management, with equity between regions and generations and recognition that public provision funded through general taxation is the only fair way to achieve excellent public services;
- a judicial and correctional system that is effective, egalitarian, evidence-based and humane;
- education, health, science and welfare systems of the highest quality which meet the needs of all, especially the most vulnerable;
- a future that involves the closest possible relationship with our partners in the EU, while working with like-minded member states to address legitimate public concerns;
- alongside international partners, a strong and commensurate response to climate change, defence and security threats.
These objectives can be achieved, but only through far-reaching changes to a system of government which serves the interests of the powerful at the expense of the public at large. All the great reforms: abolishing rotten boroughs and the slave trade; freedom of belief, and votes for women, were bitterly resisted and yet, when the public were mobilised, became irresistible. The time has come for a powerful new wave of reform to create a modern, responsive democracy and provide the basis for a society of social justice and opportunity for all.
What Went Wrong?
Britain, which in the 1970s was the second most equal large European country, has become sharply more divided until it is now the most unequal in Europe and the third most unequal of 24 OECD industrialised nations. The gap between rich and poor and between the most and the least prosperous regions is the worst in Northern Europe. While the share of the nation’s income taken by the very wealthy continues to rise, manufacturing declines; health, education and our system of justice are undermined; and young people are burdened by crippling debts.
As the welfare state is pared down, the United Nations reports that 14 million Britons, a third of them children, are now living in poverty, while vulnerable people turn to food banks to nourish their families in what, overall, is still the sixth richest country in the World.
Advanced market economies can be divided into two groups. The first, laissez-faire group, is epitomised by the United States and is characterised by minimal state involvement in welfare, low taxation and a highly unequal distribution of wealth and income. The second, social market, group includes northern European nations such as Germany and the Nordic countries, which combine a strong role for the state in welfare and greater equality in income and wealth.
Both models have proved successful in terms of growth; but in different ways. The US model has encouraged extraordinary advances in technology and innovation which (with a huge, integrated home market) have delivered average incomes among the highest in the World. But it has failed to deliver welfare standards which are taken for granted in northern Europe, with poverty alongside enormous wealth, poor school outcomes and a profit-oriented health system, which fails a significant proportion of the population.
As OECD surveys have repeatedly shown, the social market countries consistently top international rankings in terms of happiness, outperforming the United States by a wide margin. Poverty causes unhappiness but wealth above a modest level has diminishing effect, while personal safety, secure employment, good health care and the prospect of well-being in old age are essential to happiness at all income levels.
Britain Abandons the Social Market
When Labour came to power with an overwhelming majority in 1945, Britain adopted elements of the northern European social market economy model and a consensus developed around full employment, decent housing for all and an NHS which provided proper health irrespective of inc0me as a matter of right. But the home-grown model that developed in the UK differed in important respects from the social markets being created in Scandinavia, the Netherlands and Germany.
First, Labour’s Programme involved nationalising a large number of strategically important companies, which had previously been in private hands; second, like France and Italy, it retained a conflict-based model of industrial relations rather than building a law-based partnership approach of the kind adopted in other parts of northern Europe; and, third, (apart from the NHS) the welfare system provided by the state was relatively ungenerous compared with the systems created in Germany, the Netherlands and Scandinavia.
Handicapped by a highly regulated economy, industrial conflict and a small home market, Britain was soon slipping behind the countries of the European Economic Community. After unsuccessful bids in 1963 and 1967, the UK joined the EEC in 1973. But efforts to re-mould labour relations led to the defeat of Labour in 1970, the Conservatives in 1974 and Labour again at the end of the decade.
The failure of the Labour Government after the war to create a fully developed social market economy, with proper state pensions and maternity benefits and strong employment laws opened the door to Mrs Thatcher in 1979. She brought with her a ready-made alternative model of society developed by neo-conservatives in the United States based on privatisation, cuts in tax and welfare and abandoning the aim of secure, well-paid employment for all.
The Labour Party initially defended the post-war model but, after losing three successive elections under leaders who were seen as dominated by left-wing trade unions and weak on defence, ended up, to escape the political wilderness, selecting Tony Blair, who adopted much of Mrs Thatcher’s neo-conservative philosophy. While successful in electoral terms while he remained leader, this undermined Labour’s claim to a morality based on social justice and deprived the country of any clear alternative vision of society.
The neo-Conservative illusion
This new consensus was justified by two contentions: first, that reducing the role of the state was essential for faster growth; and, second, that cutting taxes on the wealthy would benefit poor people through the so-called trickle-down effect. But in fact, neither of these claims has been borne out by experience. The European social market economy model has actually proved very successful at promoting long-term growth, while avoiding gross inequality. Average incomes in countries such as Denmark, Finland and Germany are among the highest anywhere. The trickle-down effect has also proved an illusion, with the US and the UK experiencing the worst inequality in the developed world.
Wealth follows power and, with an electoral system that sidelined most of the population, politicians persuaded themselves that it was in the national interest to manage affairs in ways that benefited party funders and key groups of voters. This ultimately led to the referendum campaign of June 2016 and the threat of Britain abandoning the Single Market and with it the legal underpinning of much of the social progress achieved over the previous forty years.
An Experiment that Failed
International experience shows that gross inequality in the UK is not an inevitable consequence of globalisation or technological change, but of conscious political decisions and of our fossilised first-past-the-post political system. Once the Mother of Parliaments, Britain today is in urgent need of democratic renewal with low turnout, governments regularly returned against the wishes of a majority and widespread contempt for politicians and the political process.
Without any coherent alternative long-term vision, successive Labour, Coalition and Conservative Governments, turned Britain into a laboratory for a menagerie of right-wing pet causes (private prisons, academies, foundation hospitals, debt-based tuition fees, police commissioners and executive mayors) inspired by think tanks linked to the US Republican Party, which have generally made matters not better but much worse.
The Thatcherite consensus became a political straight jacket, impervious to the evidence of bulging prisons, mounting household debt and growing numbers of homeless people on the streets. After three decades, research suggests that while the agenda did encourage labour market flexibility and attract foreign investment, on balance, comparing Britain with countries such as Germany, Canada and Scandinavia, it is clear that the experiment as a whole has failed disastrously to deliver what the public were promised.
The rich have got dramatically richer but the quid pro quo, that wealth would trickle down to the less well-off, has failed to materialise. The need for a welfare system safety net is greater than ever. Growth has been slower, not faster, since Mrs Thatcher came to power than before. Tireless efforts to transfer control of publicly funded schools from local authorities and parents to private sector and religious organisations have left the UK second to bottom of the OECD countries in terms of key educational indicators.
The marketisation of health provision in England has fed an army of private contractors but has left the Health Service performing no better in England than in Scotland, where care has continued to be delivered free from the burden of obligatory tendering. For a nation which built the NHS, the BBC, a vibrant manufacturing sector and the best university system in the World to put health care up for auction, prevent local authorities providing social housing and education and leave the nation dependent on a Chinese state company to keep the lights on has nothing to do with good economics – it is folly.
Embedding Poverty and Disadvantage
Forty years ago Mrs Thatcher, backed by half a dozen newspaper proprietors, launched a crusade to roll back the State and create a Britain where in her words, there was “no such thing as society” and “only the failures travel by bus”. She set about dismantling the welfare state through bacon slicer changes, making private profit-seeking the engine of social change and replacing elected representatives by contractors and appointees.
These changes mainly hit the 35% of the population who don’t vote. Though widely unpopular, no single one was so large as to provoke concerted opposition from the 65% who did, but together, step by step, they profoundly altered British society. Taken up by “New Labour” after 1990 and carried forward with the support of Liberal Democrat ministers through the Coalition’s austerity policy, and through Labour’s support for abandoning the jurisdiction of the European Court, Mrs Thatcher’s counter revolution marches on, while the electorate is offered no credible alternative to a mean and divided future.
Huge discrepancies in wealth and income raise profound questions of ethics, welfare and the efficient use of resources. But experience shows that, in an open market economy, fairness will never be achieved just through top-down changes to taxation. The key issue is not that a few rich people have far more money than they need but that our laws permit them to avoid paying taxes which they ought to pay and to buy things that should not be up for sale: political influence, control of information and privileged access to justice, education and jobs, which embed social injustice and blight the lives of poor families.
Turning the Tide
Echoing Lenin, Mrs Thatcher said: “There is no alternative”, but looking at experience around the world, it is clear that there is nothing inevitable about wasteful extravagance alongside food banks and debt and a prison system full of young people who cannot read or write. Talent and effort and risk-taking are crucial to our prosperity and should be rewarded, but differences in wealth must not determine political influence or access to health, education and justice.
If we are to create a society which is both economically successful and socially inclusive, we must break free from the dogmas of the 1980s, left and right, and build a new model which combines real democracy with sound economic management, equality of opportunity and a strong welfare state. As the Institute of Fiscal Studies demonstrated, the 2017 manifesto promises of both the Conservative and Labour Parties were dishonest. It is not possible to fund tax cuts by cutting public services without causing great hardship. At the same time, large increases in spending on the NHS, schools, nursery education and free university tuition cannot be paid for simply by taxing the very wealthy and increasing debt.
The Way Forward
The Radical Party, therefore, makes democracy the key to creating a fairer society. It campaigns for a fresh model based not on unconstrained capitalism nor on back-to-the-future Marxism, but on a modern vision of the social market, which has proved so successful in other northern democracies.
The mission to build a just, prosperous, cohesive and outward-looking Britain by giving real power back to the electorate, involves many aspects of our society. We aim, by reforming our devalued political system, to restore democratic choice to the central role in shaping society and so create an enduring basis for social justice and prosperity. These objectives, which we share with millions of fellow citizens, can be achieved, but only by establishing a clear vision of the kind of society that we aim to build and through far-reaching revision of a system of government which has been hijacked to serve the interests of a tiny minority.
The objectives set out below are not a blueprint, but are pointers to the direction of travel to be developed and strengthened through consultation and debate. Objectives One and Two propose an agenda for restoring power to the electorate. And Objectives Three to Twelve set out our priorities for turning the tide and creating an efficient, plural economy and a humane, inclusive and egalitarian society in the framework of a modern, outward-looking, social market vision of society.
SUMMARY OF PROPOSALS
- A fresh model of society based on a vision of a modern, egalitarian social market;
- electoral reform to restore democratic choice to the central role in shaping our future;
- strong measures to free our Parliamentary system from corruption, self-serving and inappropriate influence.