Category Archives: Philosophy
‘The Future of Work and The Earn While You Learn Revolution’ my speech to the Work Foundation – 3 March 2014
The Future of Work and The Earn While You Learn Revolution
Speech to Work Foundation
Rt Hon Liam Byrne MP
Monday 3rd March 2014
It’s a huge pleasure to kick off National Apprenticeship Week with a keynote speech to welcome your report on the future of work.
For us in the Labour party, this is an important week in an important year.
We’re hugely proud of our record rescuing the apprenticeship system from the state in which we found it.
We’re very proud of the work of the National Apprenticeship Service, which we created.
And we’re proud of National Apprenticeship Week, which we began.
This week is a chance for all of us to celebrate the extraordinary job of our apprentices – and former apprentices – like Sarish Jabeen in my Hodge Hill team serving my constituents with such skill and commitment week in, week out.
This week is a chance for us all to say that we’re determined to do more to support apprentices, like Sarish, in the years to come.
And that’s what I’ve come here to say this morning.
Our starting point
Now, I am very glad that you’ve called your conference the future of work.
I’m glad because this year we celebrate a very important anniversary in the history of our party.
It’s the 70th anniversary of the famous white paper on full employment.
It was seventy years ago this year that Ernie Bevin stood up in the Commons to present that famous paper, replete with its famous first paragraph that henceforth:
“The government accept as one of their primary aims and responsibilities the maintenance of a high and stable level of employment after the war”.
The Labour party has is and always will be the party of work. We believe work is fundamental to your flourishing as an individual; we believe in the transformative power of the pride and dignity of a job.
And that is why we are determined to put jobs at the heart of our manifesto for 2015.
The government would like you to believe that everything in the labour market is rosy.
There’s a lot more jobs to go round they say.
Well, look: as someone who started work behind a fry station in McDonalds, I believe that any job is better than no job.
But I know too that a good job is better than a bad one, and right now, there aren’t enough good jobs to go round.
It was Ronald Reagan who said; ‘it’s true that hard work didn’t kill anyone but I figure why take the chance’.
The president was of course being charming.
But the truth is that the lack of good jobs today, means that it is harder than ever to make a living by working hard.
- Nearly 80pc of the jobs created since the election are in low skilled sectors.
- Average earnings are now £1,600 lower per year than they were at the last election.
- The average family has to work two hours extra each week, just to make what they did four years ago.
- The great wage crash is now almost proving as damaging to workers’ livelihoods as the global financial crisis caused by the banks.
I think it should be pretty clear that this is not the kind of country we want to live in.
A low pay, low skilled, low value added economy, out-paced and out-boxed by new powers, rising around the world and old nations who, unlike us, have got their act together.
We can’t go on like this. We have to change course. And this morning I want to sketch out how.
The Future of Work
Let me start with where you start; the future of work.
It’s no secret that there are some big forces at play.
Technology has now automated huge numbers of what were once, reasonably skilled, reasonably paid jobs. And sometimes it feels like what technology hasn’t killed, trade has moved to those parts of the world where workers are cheaper.
In America, economists Autor & Dorn are amongst many who’ve reported:
there’s been massive substitution of those ‘low skill workers performing routine tasks – such as book-keeping, clerical work and repetitive production and monitoring activities – which are readily computerized because they follow precise, well-defined procedures’.
It’s created what some call the hour-glass; high skill jobs, and low skill jobs and very little in between.
This is exactly what is happening here in the UK.
Indeed, the Resolution Foundation tells us that jobs in sectors with a high concentration of routine tasks fell by 5% between 2007 and 2012.
But guess what: there may be an awful lot worse to come.
A book that a lot of people are reading right now is the Second Machine Age.
It’s a positive book and its argument is simple:
Our ability to combine technology – processing power, cheap sensors, robotics, networks, social media, big data, means we’re now at an inflection point in our ability to combine and recombine technologies to do new things, revolutionising technology from Google’s driverless cars to better diagnosis of diseases.
- There’s now enough technology in a Nissan LEAF to render the car a fly-by-wire robot, the kind of technology that could revolutionise the logistics industry.
- GE already makes robots that can climb and repair wind turbines.
- Future Advisor already uses Artificial Intelligence that’s strong enough to offer personalised financial advice.
- Algorithms are taking on tasks once performed by para-legals, contract and patent lawyers.
- Oncologists at Memorial Sloan-Kettering Cancer Care use IBM’s Watson computer to provide chronic care and cancer treatment diagnostics.
What’s does this mean for jobs?
Well, academics at the Oxford Martin School now estimate that as many of 47 per cent of the jobs in our economy today may be automated.
First it was the blue collar jobs. Now it’s the white collar jobs as well.
So what do we do?
Well, economists have worried about this kind of problem since JM Keynes flagged the issue of ‘technological unemployment’ back in 1930.
And as Keynes argued then, this can be a ‘temporary phase of maladjustment’ but only, I believe if we now get three things right.
First, we have to grow our knowledge-intensive industries; those firms in sectors like – computer programming and consultancy, pharmaceuticals and telecommunications – with a lot of intellectual property that they want to keep closely guarded.
Right now, those firms make up 1/3 of output, 1/3 of businesses but just one in five jobs.
Now if it was 1/3 of jobs, then we’d have 2.4 million more jobs in knowledge intensive industries.
Those jobs pay an awful lot more than average – £161 a week more – and that’s why other countries are working so hard to put science and innovation at the heart of their growth plans. We should do the same.
Second, we have to foster enterprise, new business and start-ups like never before.
It’s why we’re determined to be the party of small business and enterprise.
But, third, you have to build a great escalator to these new well-paid jobs for people, no matter where they started in life.
Right now, for many people, that escalator is broken.
Now, we do well at getting young people on an academic track into university.
The changes we made in office have created one of the strongest higher education systems in the world.
But, we our vocational system is not world class.
In fact, it’s a long way from world-class.
Here’s what the OECD said about our country last year:
‘England has too little vocational provision at post secondary level in comparison with many other countries, and relative to potential demand’. OECD P7
Just 10 per cent of the post secondary cohort is in vocational education and training – when many OECD countries have three times as many.
Neither our young people, or our employers think this is good.
McKinsey found that just 40% of UK young people believe that post-secondary education improves their employment prospects – that’s the lowest figure in the OECD.
Over two-thirds say that academic paths are more valued by society than vocational alternatives;
A third of employers now say that the lack of skills is the reason for entry-level vacancies and thanks to the destruction of our careers service, many young people are terribly informed about post-secondary choices.
So: what are the changes we need to make?
First, we have to create a gold standard technical qualification route for young people, with strong English and Maths, studies up to the age of 18
Today, Tristram Hunt is saying more about how we will create an aspirational new ‘National Baccalaureate’ for all school leavers which includes rigorous, stretching and labour-market responsive academic and vocational qualifications and skills;
How we will tackle the scandal of the more than 1 million young people not in education, employment or training by requiring schools to ensure their pupils progress post-16 – and use existing funding to support a radically transformed careers guidance system;
And how we will confront England’s international standing in maths and English by ensuring all young people continue to study assessed maths and English to 18.
Second, we have to at least double the number of apprenticeships on offer.
When it is harder to get an apprenticeship with Jaguar Land Rover than it is to get into an Oxford college, then I think it’s pretty obvious we need more.
In fact, there’s a strong case for saying we need to double the numbers of high quality apprenticeships.
Right now, we have 140,000 young people who are not in education or training.
Surely most of these young people should be on an apprenticeship.
So we’ve said that we will set up a something-for-something deal with employers – giving industry much more control over skills spending and standards, and in return asking that they increase the number of high quality apprenticeships in their sectors and supply chains.
We’re also studying hard the reforms pioneered in Manchester, which has been testing a UCAS style system for apprentices – long before Nick Clegg announced it.
And we like the look of the extraordinary pioneered in Leeds, where the City’s new Apprenticeship Hub, has doubled the number of apprentices in the city especially amongst SMEs, which as we know are creating jobs much faster than big business.
Third, we need to show young people and their parents that apprenticeships are a route the top.
For many aspirational families, they worry that apprenticeship are a cul-de-sac and not a fast-track to greater things.
The evidence shows they’re right.
I say: there should be no limits on how far an apprentice can go.
But that means revolutionising the number of apprentices who study university level qualifications.
Overwhelmingly, degree level education is the dominant course of post-secondary education.
There are 10 times as many people studying bachelor’s degrees as foundation degrees.
But the OECD found (in 2009) that the progression rate for apprentices at level 3 into higher education is just 6pc in the UK, slightly better than one in twenty.
‘The weak articulation between level 4 and 6 programmes and university bachelor programmes is a serious problem’
That is simply not sustainable in the world that is coming.
If we’re to solve this, I think we are going to need a far imaginative reform for higher education than simply abolishing student number controls for universities.
We’re going to need real action to create student choice.
Over the next few weeks, I’m afraid you’re going to see the Conservative party go into election mode.
The story they’ll tell is simple.
The problems we face today can only be solved if we set out a bold plan for less government.
In the words of the authors of Britannia Unchained, they’ll say “the siren call of the statists’ must be resisted and the “deadwood from the public sector” cut back.
Well, I’ll share a secret.
It wasn’t too much government that caused the financial crash. And it wasn’t too much government that caused the wage crash either.
What we need today is some-one to fix the market, with a different kind of government. A smarter government, determined to act to help our country grow and create a society where no matter who you are or where you’re from, if you work hard, you’ll succeed.
That’s the country I want for my children and my constituents.
I’m some-one who has been very fortunate in life.
I went from behind a fry station in McDonalds in Harlow, to the Harvard Business School to start a business, to represent Hodge Hill with a seat in the Cabinet.
Today, my young constituents are denied those kinds of chances. More than one in five is unemployed and two thirds don’t get to go university.
I am in politics to change that.
I am in politics to restore the kind of social mobility that once upon a time we had in this country.
And I believe we can do it, but only if we change course.
I know the size of the task.
But with your help, I believe it can be done.
Thank you very much.
 Autor and Dorn, Services and Polarisation, American Economic Review, 2013.
 McKinsey, p.18.
 In Scotland the ratio isn’t 10 to 1, it’s 2 to 1.
 OECD, p45
 OECD, 46
Last week I led a delegation from the Commonwealth Parliamentary Association (CPA) to India. Whilst on the trip I wrote an article on UK / India collaboration on Higher Education and particularly International Students for the Times Higher Educational Supplement. You can read the text of my article below:
We must rev up our relationship with India
27 FEBRUARY 2014
The UK has to strengthen ties with Asia if it is to reverse the decline in international students, says Liam Byrne
The fall in international student numbers has caused widespread concern across UK universities – and rightly so. Amid a booming global market for higher education, a drop in numbers reveals one blunt truth: Britain is losing market share.
I’ve just returned from India, where I was getting to the bottom of what we need to do to stop the decline and restart the growth. Three facts are striking.
First, we are not even at the “end of the beginning” of our education relationship. Education leaders in India are very clear about the value of international links. “We want our students to be able to compete as global citizens,” one college principal said to me. It’s as simple as that.
The British Council has breathtaking forecasts about the size of the Indian student market. It is not simply that there are more than 600 million people under the age of 25, it is also that Indian students have the biggest appetite to learn abroad. In a country that is clear about the economic virtues of learning English, just 10 per cent of the 1.2 billion population speak English and only 5 per cent speak it well. There is a huge market for us to aim at.
Second, the British education brand still holds extraordinary lustre – but our competition is increasing dramatically.
In a Q&A with 100 students at the elite Sri Venkateswara College at the University of Delhi, I heard from India’s future research scientists, biotech entrepreneurs, teachers, journalists and politicians. What is fascinating is how many of these young people consider international experience and connections to be critical to their future success. But plenty are worried about the chances of landing a graduate level job in the UK even if they manage to undertake their undergraduate studies here.
Timothy Garton Ash, professor of European studies at the University of Oxford, recently argued in a national newspaper that a thesaurus does not contain enough words to describe the folly of the government’s approach; last week, his comments featured in the op-ed pages of The Hindu andHindustan Times.
I know better than most the challenges of getting the immigration balance right. When I was immigration minister, I created the UK Border Agency and introduced the points system. I took immense care to create a system that I thought would work well for UK universities, not least because every British ambassador I met told me that increasing foreign student numbers was the key to expanding our long-term influence in countries where we are not quite the centre of diplomatic attention.
No doubt I did not get everything right. But the signals sent by the reforms of the past three years are heard loud and clear by potential students in India, creating a great wall of noise that makes it harder, not easier, to get the message through about our brilliant UK universities.
That is why it is simply ridiculous that students are in the “net migration target”, and that is why David Hanson, the shadow immigration minister, and I will be soon hosting round-table talks with university and further education leaders to discuss how to claw back lost ground. After all, universities in India have plenty of choice in terms of selecting international partners. One leading principal told me that she was partnering with institutions in Germany and Italy because they teach English well – and more cheaply than we do.
Third, we have to think more radically about building a deeper and wider UK-India education relationship.
Indian vice-chancellors are hungry not just for UK students, but for joint research, faculty and postdocs, beyond the 600 or so education partnerships created through the UK-India Education Research Initiative.
India’s business leaders, like their counterparts in the UK, want a better supply of more “employable” students, and the Indian government has set a target of upskilling an incredible 500 million people within a decade. Like us, Indian policymakers worry about closing the gap between secondary school and university, and that means vast opportunities for our great further education colleges.
So we should be immensely ambitious. If the global race is anything, it is an innovation race. Indian leaders know that they have to double the less than 1 per cent of gross domestic product they currently spend on R&D if they are to put “affordable innovation” within reach of the Indian mass market. Frankly, we face the same challenge. The fastest way out of today’s living standards crisis is to increase the number of people working in knowledge-intensive sectors, where wages are 40 per cent higher than the national average.
You need only look at the extraordinary success of Jaguar Land Rover, a subsidiary of the Indian carmaker Tata Motors, just north of my Birmingham, Hodge Hill constituency, to see what is possible. The fundamentals of our innovation relationship are strong and getting stronger. Developments such as the new Emerging Powers Research Fund, for international scientific collaboration, and Newton International Fellowship scholarships are exactly the kinds of initiatives I called for in my book Turning to Face the East: How Britain Can Prosper in the Asian Century (2013).
The surest way to put this relationship in the slow lane is to make it ever harder for students, teachers and researchers to get across the border.
For political junkies, it is a good time to be in India, the world’s largest democracy. The country is about to go to the polls and, for the first time in years, a change is on the cards.
During my visit, the finance minister presented his budget, a last chance to put a few poll-winning goodies before the voters. And what was there among the headlines? Big new subsidies for student loans. Indian politicians know the allure of a better education for the world’s biggest middle class. We should be doing more to put those dreams within reach.
I thought you’d like to see this new report we launched in the House of Lords this week, produced by Roland Berger.
Britain needs to turn east if we’re to rebuild ourselves as a mighty trading nation
once more – and this vital report helps show us how.
As Chinese leaders step up their reforms in search of the ‘Chinese dream’, a huge new
market the size of Greece is being created every eleven weeks. But we need to get
organised if we’re to share in those new riches – and we need to think carefully and
strategically about how we structure the win-wins that will be good for both countries.
This report could not have arrived at a better time. It offers a detailed study of how
we can clear away the barriers that stop us exporting, become China’s favourite place
to invest and build the joint ventures that will create jobs both here and in China. It
demands to be read by business people, policy makers and politicians everywhere. In
the APPG, we’ll be doing our utmost to ensure its ideas, messages and proposals are
heard far and wide.
I hope you enjoy reading the report you can access the report by clicking here.
I recently met with representatives from the Campaign for Social Science, a group which advocates a greater role for Social Science in political and public life.
See below for their summary of our fascinating meeting:
Labour government would “restore the dignity of social science,” says Byrne
A Labour government would “restore the dignity of social science within government,” the Shadow Minister for Universities, Science and Skills, Liam Byrne MP, said.
Speaking at a Campaign for Social Science meeting, Mr Byrne said he was “pretty attracted” to reinstating the post of Chief Social Scientist within government, abolished in 2010, as part of this. “We need to hire more social scientists [for government],” he said.
He said that social scientists could produce the research that told government how to get the best return on investment for its spending. They were also vital for ensuring that civil servants had the skills needed for their work – “making sure that policymakers are well-versed in techniques of research is incredibly important.”
Mr Byrne said the current generation of public servants was “hard pressed”, and there had been a “huge exodus of talent from central government, so what you are doing is more important now than it has ever been.”
The need for social scientists applied to local as well as central government. The “1,000 most influential public servants in local government” needed to know who to ring for the best social science research to guide them when they were writing cabinet papers for politicians, he said.
Mr Byrne said that scientists and social scientists had to do more to make their case to the political parties in the run up to the General Election in 2015, in particular to makes clear that the ‘flat cash’ policy of not adjusting the science budget for inflation was hitting research.
“It is going to be really important that leaned societies and others are talking about the damage that flat-cash would do if it is sustained for another five years. Most people in the research community say it is bone they are having to cut, not fat any more.” Scientists needed to “make the lifting of flat-cash the test of whether a party is serious about science and innovation-based growth.”
This was particularly important because the NHS and schools budget were guaranteed to be maintained and so large cuts would have to fall within the Department for Business, Innovation and Skills, which funded universities. Its budget could see a £2 billion cut over the three years after the election.
Mr Byrne, Chief Secretary to the Treasury in the last government, said that Labour would make “repairing the economy” central to its election strategy, in particular increasing the number of well-paid, skilled, secure jobs, which had been significantly cut by the economic downturn.
It would make sure that the education system produced workers capable of taking on these new jobs. As part of its policy on this, Labour wanted international companies with large R&D budgets to invest in Britain; to use universities to develop regional economies; and to make “a complete transformation” in the numbers of apprenticeships in Britain, and make it easier to move from further education to higher education.
As part of this “we are going to have to think very hard about what the future of student finance system will look like because we have a 40 per cent decline in the part-time places and real problems for post-graduates students – we don’t have a student finance system that’s fit for the 21st century.”
He said that Labour was “the party of full employment and we are very clear that the way back to full employment is through science and innovation policy.”
Mr Byrne was speaking at a special meeting of the Campaign for Social Science’s Board. The restoration of the post of Chief Government Social Scientist is one of the main aims of the Campaign.
After the meeting, Professor James Wilsdon, Chair of the Campaign, said: “We’re very grateful to Liam Byrne for meeting with us, and for the depth and seriousness of thought which he’s bringing to the task of developing Labour’s agenda for universities, research, skills and innovation, ahead of the next Election.
“Liam clearly recognises the contribution of the social sciences to the economy, society and public policy. It’s now down to us, as the social science community, to provide him with the evidence and arguments he needs, to make that case more widely.”
In case you missed it, here’s McKinsey + Co’s study of education to employment transitions across Europe.
The conclusions are very striking – and very similar to our own. Today’s system isn’t working and we need reform – especially for the ‘forgotten 50 percent’ who don’t go to university.
Liam’s new book on the rise of China and how Britain can respond to, and thrive in, the Asian Century.
You can purchase a copy of the book here.
The global crash has dramatically changed the world’s balance of power. America, once the world’s hyper-power, is in retreat and mired in debt. Europe confronts a similar fate and with weaker animal spirits for help. But China’s rise seems unstoppable. The Asian century, long predicted, is arriving 20 years faster than expected.
But Britain isn’t ready. Since the loss of empire, our trade and security have been bound up with our neighbours across the wide Atlantic and the narrow channel. Worse, the globalisation of the last 20 years has left us feeling introspective and insecure and in little mood for a new and determined push overseas.
Yet now is not the time for a failure of nerve. Our success in the century ahead may depend on our success in Asia. Britain now confronts a choice. To muddle through and get by with old allies or fast forward and resolve to prosper in the Asian century.
Praise for the book:
“With the world moving East there are few better guides to the challenges we face.”
“An excellent account, by a frontline politician, of how Britain needs to change to succeed as an innovation nation in a world in which China plays an increasing role. It deserves to be widely read.”
Lord Sainsbury, Chancellor, Cambridge University
“What a wake-up call! We really are at five-to-midnight as our country deals with Asia’s century. Turning to Face the East sets out the ‘how did we get here’ and then the ‘what can we do about it’ and leaves hanging in the air the conclusion that every reader must reach about what will happen to us if we do nothing.”
Lord Digby Jones
“In the space of a generation China has risen from isolation and poverty to become a global power, but one we have no easy framework within which to understand. Liam Byrne’s wide ranging study, grounded in his own experience as a politician, asks how fit for purpose UK policy is towards this major complex power, and finds it wanting. This book is a wake-up call for policy makers, business people, academics – anyone who needs to think and engage with China. And these days, as his book vividly shows, that means pretty much everyone.”
Kerry Brown, Former Head of Asia Programme, Chatham House
“Liam Byrne’s book is a thoughtful and wide-ranging reflection on one of the most crucial economic issues facing Britain today. It will stimulate an important and much-needed debate on our future in an era of growing Chinese power.”
Rana Mitter, Professor of the History and Politics of Modern China, University of Oxford
My speech to Progress Annual Conference on Saturday 12 May.
30 January 2012
In the 1990s, progressives learned an important lesson about how to win elections: we built wide coalitions; we held firm to traditional values; but we freed the political mind for new solutions, new methods, new ways of doing business. We kept our philosophy. But we changed the policy. We forged a new path between old-fashioned leftwing statism and new-fangled rightwing laissez-faire.
That new approach worked for Bill Clinton’s New Democrats, the Australian Labor party, the New Democrat party in Canada, social democrats in Germany, the Netherlands, Norway – and, yes, for New Labour.
And today it feels like a long time ago. The political confidence of the third way has taken a battering. Yet faltering growth, worried financial markets, rising unemployment and social unease all point to one thing: the need for a new progressive politics. Yet outside the United States, Brazil, Norway and Denmark, progressives are not winning by default. We need a new way back to the centre-ground.
Now some, of course, will say: ‘New Labour was the mistake. Let’s go back to the 1980s.’ Others will counter: ‘We were not modernising enough.’ A debate like that will not get us far. In 2015 we face a new world: a new global balance of power between Asia and the west, and a budget £30bn in the red. So Ed Miliband is right: we need hard thought now about what to keep from the third way and what to change for new times.
So first, let’s move on from the 1990s. Why? Because, as the world changed, politics changed – and we did not. Tony Blair once argued: ‘What of policy? Our approach is “permanent revisionism”, a continual search for better means to meet our goals, based on a clear view of the changes taking place in advanced industrialised societies.’
But our politics did not keep pace with the change we helped to author. By 2005, progressives had helped create a vast new global market that linked six billion of the world’s seven billion people. Massive new movements of capital kept interest rates low but fuelled asset bubbles. The market, our society and technology changed fundamentally. New challenges emerged: a new inequality between the middle and the top and young and old; living standards plateaued; old solidarities, old communities felt pressured; asset bubbles burst; and banks crashed.
Back in 1958, Tony Crosland wrote: ‘The intellectual framework within which most prewar socialist discussion was conducted has been rendered obsolete.’ Economic growth and ‘a different configuration of economic power … call for a complete reappraisal of the socialist position.’ The revisionist’s lesson? Change as the world changes.
That is why, after the third way, we need a new way back to a new centre-ground. Let’s keep the insights of the 1990s but build on them for a different era. Let’s keep the best of New Labour, not least the late Philip Gould’s basic insight: ‘What most voters want is over time and without greed to advance and improve their lives. In short, to become better off.’
Let’s keep the insight that elections are won in the centre-ground by building an alliance around the values – aspiration, responsibility and community – that unite traditional supporters with footloose voters who change sides.
What does that centre-ground look like? It is bigger than before. More voters are more likely to switch sides. Look at Scotland. No one can win elections trading on old loyalties. That is true for social democrats everywhere. Attitudes have changed too. Take the latest British Social Attitudes Survey which found that support for tax increases to spend more on public services has halved from nine years ago and only a third now say that government should redistribute wealth.
This is no counsel of despair. Neither opinion polls nor by-elections point to any return to Maggie-mania. As Deborah Mattinson puts it: ‘When things get really hard the instinct to put nearest and dearest first is, understandably, paramount.’
This is why Labour’s leader is placing our party firmly in the centre-ground with new ideas not old attitudes. Globally, social democrats are pinpointing five basic principles that can deliver our values in tough times. But Labour is leading the way.
First, the deficit needs not denial but fiscal realism. That is why Ed Balls is tough on tax and public spending. But his approach marries aggressive short-term action to boost jobs and growth, with medium-term ideas to bring down debt. The crash taught us we cannot immunise the world from financial crashes; we have now had 40 since 1800. If we want to protect our room to act when future trouble breaks, we need to bring debt down. That is the best insurance policy for Keynesians. The Tories will leave us with debt at 80 per cent of GDP. That is too high, which is why we have to plan for budgets that are tight.
Second, new growth needs more than just any old jobs. We cannot compete with new economies like that. We cannot risk drawing so much of our tax from financial services. So we need a new active partnership between business and government to rebalance our economy, play to our national strengths, switch to low-carbon energy, strengthen infrastructure, redouble enterprise, and reform our banking system so that, once again, small business and entrepreneurs have the life-blood of credit to grow. This is the new bargain with business. And in return we expect business to behave in a way that values and does not vaporise trust. People want responsibility – on top pay and ethics – throughout society.
Third, we have to renew our welfare states to drive up the rate of employment. In tough times we need as many hands on the pump as possible. For some that means making sure services like childcare and social care are there to help families juggle the ‘care crunch’ so they are free to work when they like. For others it means firm action to ensure that if you can take a job, you do take a job. It is a renewal of William Beveridge’s belief that good social insurance helps people keep working.
Fourth, we know that to get through the next decade we need to draw not simply on the wealth of nations, but the ‘hidden wealth of nations’. The challenges we face today are too big to all be left to government. Governments and political parties alike need to help make it easier for good people to come together to make a difference through social action and innovation – and it is this kind of civic inventiveness that modern democracies need to renew the ties that bind strong communities together. That is why Refounding Labour is so important.
Fifth, we know that in tough times taxpayers’ money must go as far as possible. Standards in public service have to go up even when budgets are coming down. Only a revolution in innovation can square that circle. And that is very hard to mandate from the centre. So sometimes, the centre has to let go – set high standards, yes, but then free up the frontline and devolve power to speed up new ways of doing business, delivering for citizens better than before.
Finally, we need to advance this cause with confidence. Progressives win by mobilising an appeal to optimism. Conservatives want voters to feel disempowered and cynical. They want to diminish the appeal of politics. Where they are in power, they want a fearful electorate to cling to nurse for fear of something worse. Our task is to offer hope in an age of uncertainty, and optimism in an era of doubt. That is how we seize the centre-ground and build a new progressive majority.
Here is a link to my pamphlet “The new centre ground: how can progressives win a majority?” .
Full employment was the foundation for Beveridge’s welfare state. It should be the foundation for renewing it.
Every civil servant can tell you stories of ministers who are a bit demanding. I’ve had a few of those stories myself. But sometimes the same is true of civil servants. None more so than Sir William Beveridge. Back in 1941, Ernie Bevin faced mandarins in revolt at the idea of working with the illustrious knight. Looking for a diplomatic answer, Bevin shipped out Sir William to lead an enquiry into social insurance. A year later, ‘the people’s William’ had drawn up the blueprint for Britain welfare state.
Timing, as they say, is everything in politics – and Beveridge’s timing was perfect. In November 1942, the Allies had beaten Rommel, counter-attacked in Stalingrad and secured the Pacific base of Guadalcanal. It was not as Churchill said on 10th November 1942, the beginning of the end. But it was the end of the beginning. Interest in what it was the country was fighting for hit a new high, and that interest swept the Beveridge Report off the shelves.
But what turned an idea into reality, was the not the events of 1942, but 1943. After ferocious debate in the Commons – in which David Lloyd George cast his last vote against the Government – Churchill conceded that planning for Beveridge had to begin in earnest. And it was then, in government committees, that four great Labour leaders – Atlee, Bevin, Morrison and Jowitt – fused the ideas of Beveridge with a plan for full employment; the full employment that would pay to make the new welfare state a reality.
The campaign for work, for jobs, for full employment has always been Labour’s first demand. Labour. The clue is in the name. But throughout our history, Labour has insisted the right to work must come with the responsibility to work as well. Back in 1947, Herbert Morrison put it like this; ‘We have no hands and brains to waste and no resources to fritter away on those who don’t contribute to our common effort’.
Today, I would insist on the same principle. Those who don’t want to work but can are a tiny minority. But we must insist they do their bit. So, alongside our five point plan for jobs and growth, we want new ideas that enforce the responsibility to look for and take a job. Because we simply can’t afford to renew the welfare state for the 21st century without more people back in work.
New analysis of DWP’s accounts by my team reveals that the shocking costs of economic failure. The bills for the dole, housing benefit and incapacity benefit are now set to rise by an incredible £5.5 billion a year – that’s a lot of income tax.
Yesterday in the House of Lords, the government pressed its policy of a cap on benefits. It’s an idea we support in principle but we would like to see improved because we don’t want a massive new council tax bill to sort out a new homelessness. But there’s a bigger point: without work, the cap won’t stop benefits spiralling upwards. DWP’s own figures show, despite the cap, the housing benefit bill is set to rocket up £4 billion above the figure post-election, to an incredible £28 billion. That’s too high. And the way to bring it down is to get people into work.
Back in the 1940s, the British people achieved incredible things. In a famous broadcast, Labour leader Clement Attlee called on Britain to create a country where ‘all may have the duty and the opportunity of rendering service to the nation, everyone in his or her sphere, and that all may help to create and share in an increasing material prosperity free from the fear of want’. We not only won a war, we won a peace. A welfare state that gave families like mine the chance to achieve things my grand-parents could never have dreamed of. If we want a welfare state for the 21st century, that once again support working people in the lives they lead today – and want for tomorrow – then I say our starting point is simple. Let’s get Britain back to work.
Renewing our Progressive Values
By James Purnell
Sydney, Progressive Australia conference, April 2011
It’s often argued that we are facing a progressive paradox.
The paradox goes like this. After the Global Financial Crisis, we thought our progressive moment had arrived. Markets had just failed catastrophically. We were the market failure people. Surely now we’d be able to convince voters to be social democrats?
But it didn’t happen. There are now fewer centre-left parties in power in Europe than at any point since 1918.
So far, so well known. But discussing this paradox here gives it a further twist, which is vital to understanding the problem that we face and how to solve it.
The twist is this: even when we escaped recession, centre-left governments were still battered by the electorate. Your government did a remarkable job of avoiding recession and protecting people through the stimulus.
An observer from outer space arriving here on August the 21st last year would have thought that you deserved a landslide, rather than squeaking home. And you’re not alone – in Chile, the Socialist government avoided a recession and funded their stimulus entirely out of the sovereign wealth fund they’d build up in the good times.
And yet the right won for the first time since Pinochet.
So, when the economy crashes, progressives lose. When the economy doesn’t crash, progressives still can’t win. That’s the progressive paradox.
At this moment in the argument, we often play the gratitude game. It goes something like this. Why aren’t our voters more grateful for all the amazing things we’ve done for them? Tony Blair used to segue in to his Monty Python skit here – the bit from the Life of Brian where the Judeans are complaining that the Romans have never done anything for them. Apart from the aqueduct. The sanitation. The road. Oh, yes, and medicine. And education. And health.
Blair’s list would have been the minimum wage, the shortest waiting times in history, crime down by a third, Surestart, record results in schools, devolution, civil partnerships for gay couples, peace in Northern Ireland, four weeks paid leave, half a million children out of poverty, maternity pay, paternity leave, child benefit at record levels, the ban on cluster bombs, the cancelling of debt, the trebling of aid, the first ever Climate Change Act.
You get the point.
And yet, still our Judeans weren’t grateful. That is the cause of our progressive paradox.
I want to argue today that the way to answer it is not to renew our progressive values, but to return to our Labour tradition. I want to argue that it is the Labour tradition that is a better guide to re-organising and re-thinking, and then winning again.
I’m not an expert on your politics, though I’m looking forward to learning more in the next 2 days.
Instead, I want to focus on why Labour lost in Britain, and what lessons we can draw. I’ll be very interested to discuss the differences as well as the similarities.
This was a catastrophic defeat for Labour. The worst decline in the Labour vote since the War. The previous worse was a 2.4% drop between 1974 and 1979. This time we managed to mislay 6.5% of our vote. .
To understand why, we should start with the Election campaign itself. Two images dominate my memory and each provides important clues to why we lost.
The first is the third debate. Gordon Brown had just had his worst 24 hours in politics, and he’d had quite a few of those, in the aftermath of him calling Mrs Duffy a bigot. I gather that made headlines around the world. Yet what you may not have seen as much of here was his performance the next night in the third TV debate.
Imagine yourself in his shoes – you’ve been judged to have lost the first two debates, your Party is polling below the Lib Dems and looks like it’s going to come third for the first time since 1918, immigration is the biggest issue in voters’ minds and you’ve just called a Labour voter a bigot behind her back for raising that issue with you. And now you’ve got to go on TV all over again.
And yet he did rather well. He was a tough old so and so, even I have to admit.
He did rather well. He was an incredibly tough and resilient politician, even I have to admit.
However, it was a performance woven around the negative – gone was any pretence at defending Labour’s record or offering an alternative. The message was simple: the Conservatives are a risk. Labour ran a fearful campaign, in every sense of the word.
The conventional explanation for why Labour had run out of steam by the Election was that it had lost the courage to defend and to reform, and that is a good part of the truth.
But the second defining moment of the campaign teaches us even more. It is what Mrs Duffy actually said:
Look, the three main things that I had drummed in when I was a child was education, health service and looking after people who are vulnerable. There are too many people now who aren’t vulnerable but they can claim and people who are vulnerable can’t get to claim.
The rest of the exchange is just as instructive, in retrospect. She says local schools are good, hopes her grandchildren will go to university, but is worried that she has to pay tax on her widow’s pension.
Mrs Duffy sums up all the reasons why we had to create New Labour. That we needed to be for aspiration, good public services, decent public behaviour and a concern for the most vulnerable. Yet, 13 years on, despite recognizing that Labour had delivered pretty much on those promises, Mrs Duffy still felt angry enough to upbraid the Prime Minister.
Why? This is where I want to introduce the most interesting part of the current Labour debate in Britain. It’s the debate between Blue Labour and New Labour. Blue Labour is a term coined by Maurice Glasman, an academic who was made a peer by Ed Miliband.
Maurice argues that Mrs Duffy and millions like her had good reason to be angry. It wasn’t her gratitude problem. It was our attitude problem. It was that we had become progressive rather than Labour.
This may sound slightly surprising. You might think that Labour and progressive are synonyms, that progressive is just the word we use at international conferences to abstract from the different names our parties have ended up with in each of our countries: social democrat, socialist, democrat, labour. You may think it’s just an accident of history that we ended up with these different names, and that we need an international word for centre left. Progressive would then be that word, the Esperanto for ‘social democrat’.
But those histories are not accidents – they are the traditions from which we each get our energy. They are right for each of our countries because they grew out of our different histories – why for example Britain never developed a revolutionary working class, a fact that perplexed and frustrated Marx all his life. Reality just wouldn’t conform to his theory, and that was because Britain was not the same as Germany.
I’ve been to lots of progressive conferences, from Chile to New York, and have found them full of great ideas and good people. I’m proud to be a progressive. But I’ve realized I’ve always had a nagging doubt that I wasn’t paying attention to, and that this too is a weakness of the progressive approach. That weakness is that we’ve subconsciously assumed that there is one progressive solution, a set of universal ideas, which can just be dropped in to different societies from a blank sheet of paper.
Our differences are as interesting as our similarities. The US has the American dream, it’s a country dedicated to a proposition, as Lincoln said, and that is why it has much less of a rhetoric of social protection than Europe. More dream equals less need for protection. Each gain for the welfare state has had to be in the teeth of the dominant ideology, as Obama’s struggles with healthcare reform, despite his landslide mandate, show.
So, part of my goal in distinguishing between Labour and progressive is to make a point about method. We have lots to learn from each other. But we should think of these conferences as a lens through which to look again at our own national tradition. It grew up in our country for a reason – it is the accumulated common sense of previous generations, and it is by shining a light on that tradition that we will renew ourselves.
But the other half of my goal is to make an ideological distinction. Of course, the Labour and progressive traditions are family cousins. Close cousins even. But they are also noticeably different.
Let me try to sketch the difference.
The Labour tradition argued three things:
- That markets were inherently unstable and exploitative.
- That Labour’s role was to protect people from the suffering this caused.
- By using the state and unions to reduce exploitation in good times, and to prevent or mop up crashes in bad.
As progressives we revised this argument to:
- First, that markets are the best way of generating wealth and tax revenues.
- Second, that Labour’s role is to use those revenues to help people fulfill their aspirations.
- And then third that it would do so by controlling the state and improving public services
I’m exaggerating to make a point, but I hope the difference is clear. Labour emphasized protection, progressives majored on aspiration. Labour emphasized how markets could hurt people. Progressives talked about how they normally worked. Labour wanted to reform markets, progressives wanted to reform the state.
And this is how we explain the Progressive Paradox. We had said to our voters that markets worked. So, when a huge crash in financial markets occurred, we had no way of explaining to them what had just happened. Political traditions work as a way of explaining the present, and predicting the future, and the progressive tradition had no space for this bit of data.
In fact, you could go further. Political traditions work when they allow you to define as mad the opinions of your opponents. Mrs Thatcher succeeded by defining as insane people who joined unions, wanted equality and worried about markets. Labour only got back in to power once we accepted that she was half-right: that Old Labour was indeed a bit bananas. In other words, we won when we became progressive rather than Labour, or New Labour rather than just plain Labour.
And then when it turned out that markets could still go spectacularly wrong, we were left looking a bit bananas ourselves because we’d said that could never happen. And, however good our stimulus measures were, we couldn’t get credit for mopping up the mess we had told people they’d be insane to fear. After all, we had claimed to have abolished boom and bust.
But there was a further reason why Labour lost. Voters didn’t like what we were offering next.
Back to Mrs Duffy. The progressive offer had started failing her long before the GFC, for two broad reasons. First, it operated outside her conception of fairness, and second it was too managerial. It was done to her, and wasn’t what she’d asked for in the first place.
Tony Blair was revealing more than he intended with his Monty Python routine. If people see you as an occupying force bent on civilizing the natives, they’re going to bristle, however good the tax credits. Treat them like Judeans and that’s how they’ll behave.
This trait is deep in our DNA. This is a family tree, after all. It’s there both for progressives but also for the egalitarian Labour tradition against which Tony Blair was reacting.
That second tradition is that of Crosland in the Future of Socialism. He defined Labour’s exogenous standard as equality. This was a modernizing move in its time – arguing that Labour should accept markets and use their dividend to reduce inequality.
For New Labour, the exogenous standard was a combination of economic growth with redistribution to the poorest. My point is that it wasn’t that different from Crosland – it was still accepting markets, and using them to generate money to improve public services and reduce inequality. We were just a bit shy about saying the equality bit out loud. But we were very proud of saying that we were helping the poorest and most vulnerable in society.
But that’s when Mrs Duffy says “There are too many people now who aren’t vulnerable but they can claim and people who are vulnerable but can’t get to claim.”
Blue Labour argues that this is where we’ve gone wrong. That we’ve ended up obsessed with the pattern of society, rather than the lives we lead. That in the name of helping the poorest, we’ve thought too much about what people get out of society, and not enough about what they put in.
Blue Labour argues that we should reach back to an older tradition, before Blair or Crosland. That we should excavate Richard Tawney, the great reformer and essayist, who wrote in 1932, that Labour’s creed is not “transcendental doctrines nor rigid formulae but a common view of the life proper to human beings, and of the steps required at any moment more nearly to attain it”.
Like a Zen kōan, that is one of those simple phrases that grows richer every time you pay it attention. Not “transcendental doctrines nor rigid formulae” – so neither GDP nor the Gini coefficient. But instead starting from the life proper to human beings.
This roots politics back in the lives people hope to lead. It’s not that GDP or equality don’t matter; just that they are not the right place to start.
The danger of transcendental doctrines is that they can be rather over-bearing. They can lead to a politics, especially on the left, where the elite decides what other people need and then gets angry and self-righteous when the beneficiaries don’t agree. Hence the Romans. And hence Mrs Duffy.
Blue Labour instead starts from the things that matter – “responsibility, love, loyalty, friendship, action and victory” – values that as David Miliband said in his Keir Hardie Lecture ”used to be engraved upon Labour’s heart”.
To some of you, that may sound charming but apolitical. Of course we all want friends and families, but what role does the state have in that?
What the Labour tradition teaches us, is that it’s much harder to be with your friends or see your family if you’re at the mercy of an unstable market or an exploitative employer. And what the Labour movement did in the first half of the 20th century was to bring people together, first through mutual societies and unions and then through politics, to win ways in which the life proper to a human being could be protected. A decent burial through the co-op. A pension in old age. A national health service.
The point I’m making is that renewal will not come through looking for abstract ideas. It won’t come from re-reading John Rawls or Amartya Sen. It will come from going back to our traditions.
In Britain this is happening through community organizing, as many of you will know, what Barack Obama did before he went off to Harvard Law School. He worked for the Industrial Areas Foundation, the movement of community organizers set up by Saul Alinsky. Alinsky’s Rule for Radicals has become the bible of the next generation of Labour politicians.
We’re just starting off with an initiative called the Movement for Change, which is trying to bring the craft of community organizing back in to the Labour Party. It’s similar to the Community Action project over here.
We had become rather good at new campaigning techniques – voter ID, direct mail, social networking – especially if it was online and we didn’t have to meet anyone face to face.
But in a way that had also contributed to the Mrs Duffy problem. Because all those techniques are very impersonal. They’re not about building a relationship. And again they’re very much about us telling voters what we’ve done for them. They’re about maximizing turnout rather than mobilizing for power.
In the 1990s, we renewed through policy. This time, it’s going to start with organizing. Because organizing teaches us a huge amount. It keeps our language real and our offer relevant. And it might even start to find the next generation of leaders who aren’t all Oxbridge-educated ex special advisers like me. That starts to find the Bevins and the Bevans of the 21st century, people who talk Judean as a first language.
Alinsky wrote Rules for Radicals in despair at the waste of energy of the 1960s student movements. Again and again they’d put huge amounts of effort in to demonstrations and protests that would lose. He was trying to persuade young radicals to employ the same energy to win. To make sure that whoever had the power, whether a politician, a business man or a bureaucrat had to listen and compromise.
This is where London Citizens, the British branch of the IAF, come in. The Sydney Alliance is their Australian cousin.
Quite a few of us have now gone on their five day training. And what you realize immediately is that Alinsky is also a family relative. That the techniques of community organizing would have been very familiar to the dockers striking in East London in 1889 or to the founders of the Labour Party.
The root of good community organizing is relationships, and in particular one-to-ones. This is essentially spending 45 minutes talking to someone about what motivates them: what makes them angry, what they’d like to change. It’s not a team meeting, its not an interview, its not data-gathering, it’s not a break-out group – it’s a conversation.
These relationships existed pretty naturally in industrial communities. Many feel they’re dying with those factories, but what community organizing reminds us is that they can be rebuilt, if you put the work in.
Out of those hundreds of one to ones, you find a common interest. That’s where the Living Wage came from – after the credit crunch, London Citizens organized weekends with hundreds of Londoners. What came out wasn’t a demand for equality, or for a bigger GDP – what came out was that people didn’t have enough time to see their kids. They were working two jobs to make ends meet, coming home too late or leaving too early.
They were a disparate lot. Nuns, Quakers and Imams, Mums and students, cockneys and immigrants. In another setting they might have found plenty to divide them. But by the end of the weekend, they had found a common interest.
In other words, they had built relationships based on reciprocity, mutualism and trust. That is as good a definition of what Labour means as I could give. Reciprocity: that we look out for each other. Mutualism: that we all put in to the pot. Trust: that we know that others will be there for us and won’t take us for a ride.
The trust is the magic ingredient, the bit that makes the welfare state work. A belief that we’ll all put in to it, but that the welfare state will be there when we need it. You could almost call it a Labour state of grace and we have fallen from it.
Although we thought we were renewing the Covenant with the people, they thought we were breaking it. What we said we were doing in the name of fairness, they thought was the very opposite. They felt people were getting help who hadn’t paid in. And they thought that people who needed protection weren’t getting it.
I’d actually go further. I’d say that progressives almost sounded as if we didn’t believe we could protect people any more. We would say people didn’t want a hand out but a hand up. That we couldn’t protect their old job but would help them get the next one.
And the problem with that is that it can sound very hollow when the economy turns South. It’s not much good saying that we can’t protect your old job but can’t help you get a new one. In that situation, what people want is actually a hand out.
And the problem was that when people lost their jobs in Britain, they found that they didn’t get much of a hand out. If you’d paid in all your life, you were likely to get £65 a week for 6 months, and after that nothing apart from means tested benefits.
It’s from understanding this anger that we can best renew our values and policies.
An approach to welfare which grew out of the Labour tradition would ask what are the real risks people face today, and how the welfare state can genuinely protect people against them. It would mean a system that was both more demanding and more supportive.
So, when people lost their job, they would want to get a proportion of their previous wages for a few months. Then, if they hadn’t found work after a year, they would like to be guaranteed a job. The state should be the employer of last resort. People would want a guarantee of housing, of a pension in retirement, of good parental leave and pay.
That is the kind of welfare state that they would actually fight for, rather than treat with indifference. It might need to be funded out of the cash transfers and universal benefits they value much less and which are insufficient in times of need, but marginal when things are going well.
Such a welfare state would explore how we can bring back the contributory principle – how what people get out relates better to what they put in. And it would say that people couldn’t refuse to help themselves – that the job guarantee would also be a job requirement. If anyone turned that job down, they would lose their benefits.
An approach to the economy that grew out of the Labour tradition would shape capitalism rather than taking it as it is. It would be enthusiastic about the potential of markets whilst being realistic about how they can fail, sometimes catastrophically. A much more protective welfare state would be the best way of reflecting that realism – the next crash would be less terrifying if people knew their wages would be protected and that they would be found a job.
But this wouldn’t just be about state action. We progressives didn’t really ask ourselves fundamental questions about how to shape markets. The credit crunch is a great opportunity to rethink that without being denounced as bananas. Ed Miliband has rightly identified the problem of the squeezed middle – of the stagnant wages of low and middle income workers.
Our old response would just have been to say that was a fact of life, or that the way to compensate them was through tax credits. But that’s all much more up for grabs now, and that’s why IPPR is launching a major project later this month to look at economic policy again, and how we can have markets which are much better at supporting that life proper to human beings – where wages grow much further down the income scale; where people feel in control and respected at work; but also one where there is much more private sector growth than Britain managed in the last twenty years.
That is how revisiting our traditions might help us renew in Britain. That’s what Blue Labour teaches us. But by itself it’s not enough. By itself, it would lead us to rely solely on protection. Blue Labour needs its progressive cousin: aspiration. Clinton’s mistake wasn’t saying that people wanted a hand up – it was forgetting that they also sometimes do need a hand out.
They want a hand out, then a hand up.
Blue Labour needs its progressive cousin’s central insight – that modern politics is about giving people power.
That’s what the progressives got absolutely right. In conferences like this for the last two decades, we would talk about empowerment. It was a great guide to policy. It was a good summary of our ideology. But it failed as a slogan. We never said it on the doorstep. Gordon Brown didn’t use it to Mrs Duffy.
It’s highly revealing that we wouldn’t use the word empowerment to people’s faces. That’s not because it was the wrong idea. It’s because we hadn’t delivered it. We hadn’t delivered it because we were relying entirely on the state to do it. We hadn’t made people powerful because we had forgotten how markets can crash and exploit people.
If we put aspiration and protection back together, maybe we can make that promise of power real. Maybe we could say to people with a straight face that they will have the power to live the life they want, to live a life proper to human beings.
Maybe we would have an argument that would unite the different parts of our coalition, working class and middle class, rather than seeking different messages for each.
And maybe they would then want to join our parties again and fight with us. Because they would understand that these are not rights conferred from on high, but protections won by politics and which have to be won again in each generation.
And in community organizing we have the techniques which can make that true too. Techniques which teach us how to go from making a noise to winning our battles. Not just a few of us politicians having power at the centre on the back of other people’s votes. But people themselves feeling a real difference in the power they have over their lives, through the way their communities work, the way that markets work and the way that public services work.
That is how we escape the progressive paradox. Not by importing a new set of abstract ideas. But by going back to our traditions, the Labour tradition, which when properly expressed, is the sublime embodiment of the common sense of the British and Australian peoples.
Why Labour Lost, John Curtice