Economics and politics - comment and analysis

382 seats, Mr. Corbyn. The future of social democracy


The results of local elections in the UK are a calamity for Labour. The writing had been on the wall for months. Few, if any, however, expected that it would come to this. John Curtice, professor of politics at the University of Strathclyde, expected Labour to lose more than 100 seats, opining that a loss of 150 seats was not impossible. He warned that Labour was losing ground everywhere. Tony Travers from the London School of Economics considered it possible that Labour would lose more seats in Wales than in England and see their majority cut very sharply, even in some of their heartland councils. When Hayward, a professional pollster and Conservative, suggested that Labour could lose around 125 council seats as he predicted the worst local election results for an opposition party since 1985 almost no one believed him. Traditionally, Labour does well in local elections. In 2015, it won 21 out of the 28 constituencies. Last week Thursday, it lost 382 seats.

A total of 4.851 seats were up for grabs in 88 councils – all 32 in Scotland, 22 in Wales and 34 country councils and unitary authorities in England. The Conservatives have made the biggest gains by a governing party in a local election for more than 40 years. With the general election a month away, they gained more than 500 seats and seized 11 extra councils. The Tories grabbed Derbyshire from Labour as well as Warwickshire, Lincolnshire, Gloucestershire, the Isle of Wight and Monmouthshire. They increased their total number of councilors in Scotland by more than 160. Labour lost control of seven councils, including – incredibly – Glasgow, which had been ruled by Labour almost uninterruptedly for seventy years. Labour controlled or shared power in 18 of the country’s 32 unitary councils, a swathe of largely urban authorities in central and west of Scotland and the Edinburgh. Add to this that Scotland has always been a social democratic fortress, or at least, it has been until the fateful general elections of 2010 and 2015. In the 2015 general election, Labour lost 40 of its 41 parliamentary seats in the country – this figure, if anything, highlights how much the Scots despised neo-liberal New Labour (see here and here).

Labour is now the first opposition party to lose grounds at local elections for three years in succession. The Labour Party also lost the metropolitan mayor contests in the West Midlands and Tees Valley, a traditional Labour heartland. Andy Burnham scored a big win for Labour in Greater Manchester. The Liberal Democrats lost some seats, but nothing dramatic. The SNP comfortably finished as the largest party in the Scotland, but lost control of Dundee. Almost all the Conservative advance in Scotland comes at the expense of Labour. In England, there was the complication for Labour that UKIP won 20% of the county council votes four years ago. UKIP got obliterated in this election. There is no doubt that the great majority of UKIP voters went to the Conservatives. Why vote for a small radical right wing party with no chance to govern when there is a radical right wing party in power which will happily deliver more devastation than UKIP could ever dream off? The turnout in the elections was very low, but this is normal to British standards: a mere 30%.

This is how things stood before the elections of May 4th:

  • Labour535 seats
  • Conservatives136 seats
  • Lib Dems 484 seats
  • SNP 438 seats
  • Plaid Cymru (the Welsh nationalist party) 170 seats
  • UKIP 146 seats
  • Green Party 34 seats

This is the result of the 4th of May local elections:

  • Labour 152 (-382)
  • Conservatives899 (+563)
  • Lib Dems441 (- 42)
  • SNP– 431 (-7)
  • Plaid Cymru202 (+33)
  • UKIP1 (-145)
  • Green Party 40 (+6)

Local elections are important

These local elections are important because the policy-makers that are elected to run local and city regional administrations do so against a backdrop of austerity and ever increasing pressure on local services. Once sold as local democracy, devolution is a typical tactic in the politics of scale. National governments redistribute certain powers back to the local level, which subsequently cannot act as it (or its electorate) sees fit. When government cuts their budgets, local levels become de facto austerity implementation machines, very often against their own inclinations. This process has cunningly been called the distribution of responsibility without power by those who enjoy power without responsibility by Ash Amin (see here).

So often a thankless task, local government is being made the scapegoat of a decade-long withdrawal of central government funding in areas such as social care. Many leisure centres, libraries and social work departments have faced cuts and closure. During the reign of the Tories, food banks and homeless shelters have witnessed a spectacular rise, notwithstanding the fact that their funding also has being cut. If you read my article from last week, which gave a selective overview of some of the Tories’ most memorable achievements, the question is how it is possible for anyone with a conscience to vote for this party (see here). That this does not seem to be a problem shows how much the rot has advanced.

The devolution game means that local councilors and mayors take the blame for the failure of local services. In some areas, however, local politicians have significant powers. Metropolitan mayors have been chosen in six city regions, including Greater Manchester, Liverpool and the West of England. These mayors have powers including economic regeneration, transport and housing (and in Manchester’s case even health and social care).

The second reason why this election was important is that it took place against the background of the general election of June 8th. Will May’s gamble to call a general election pay off? In normal circumstances, local elections are bad guides to the next general election, because, as a rule, governments suffer protest votes which benefits opposition parties. This election constitutes the exception to this rule and, on top of all else, Labour is now stuck with the label of the first opposition to lose ground in town hall elections three years running.

Labour’s strategy

Labour seems to have no strategy left, except to ignore the result, go on and hope for the best. Until Friday, they could hope for a result that was better than the worst case scenario of a loss of hundreds of seats. This is no longer possible. Not even Corbyn’s biggest enemy had reckoned with a loss of so many seats (see here).

The headline figure is now a projected national share of 27% (see here), the worst figure since the BBC started making these calculations in 1981. The Tory lead of 11 percentage points is larger than the one Thatcher enjoyed in the 1983 and 1987 elections, when she won her legendary landslides. As said, Labour lost Glasgow. It lost the new mayoralty of Tees Valley, which covers Darlington, Hartlepool, Stockton, Middlesbrough, Redcar and Cleveland to the Conservatives – areas that traditionally have been part of the Labour heartland. Labour lost in Derbyshire and the West Midlands – the latter voted Labour over the Tories in 2015 by 42% to 33%. Unfathomably, the Tories picked up seats in the most deprived parts of the country (including Glasgow and Paisley). It is true that Labour won mayoral races in Doncaster, the Liverpool metropolitan region and Greater Manchester. This is great, but it should really be givens for a Labour opposition fighting the Tory party that has now been seven years in office.

Explaining Labour’s melt down

A lot of commentators are trying to make sense of Labour’s electoral meltdown. Jonathan Freeland explains in the Guardian that UKIPs programme has been swallowed in its entirety by the Tories, thereby making this party redundant. In past week’s election, UKIP voters transferred en masse to the Tories, reassured that May will give them the hard Brexit they want (see here). This is certainly true. As Freeland also writes, some of those Ukippers had once been Labour voters, with UKIP serving as the gateway to conservatism. On top of that, there are other, long-term, structural factors. Social democratic parties are struggling across Europe and beyond and the Brexit has upended everything: many working-class anti-EU voters feel better represented by May than by Labour (see here).

John Harris, also in the Guardian, points to something else, which is also both real and worrisome: the disconnect, emotional and cognitive, of people from politics. Many consider the election a distant irrelevance, hence they do not even considering voting. Their predicament barely intrudes on the election and the election does not intrude on them. With distinct echoes of politics in the US, people are so wearied by their day-to-day worries that the idea that the noise which is emanating from their TV might offer any change seems laughable to them (see here).

There is no doubt that Freeland and Harris identify real phenomena. However, as an explanation of the result they are utterly insufficient. How many migrated from Labour to UKIP and from there to the Tories and because of what? It cannot be the Brexit, because Labour also supports it. As for Harris’s disconnect and dismay of politics, who is to blame for it? As for the assumed irreversibility of it, did anyone ever try? Tony Blair writes neat opinion pieces these days: he would do so much better than Corbyn. No doubt, except that without Blair – neoliberal Labour – there would probably never have been an UKIP. Without Blair, Labour would probably never have lost 40 of its 41 seats in Scotland. Because what was the problem? For who was the worker with stagnating or falling wages or the one who had been made redundant and could now fully enjoy her or his personal emancipation from the paternalist social welfare state through forced labour activation and decreasing benefits supposed to vote? The neoliberals of all parties left these people behind, assuming that they would never pose a threat. The party bosses and their strategists assumed that the precariat would continue to vote for New Labour, regardless of whether some of their MPs threatened to be tougher on people on welfare than the Tories (see here and here) and, indeed joined the Tories in voting for the cuts.  It was exactly the same last year in the US, when the Democrats arrogantly boasted that they did not need the blue-collar workers of Pennsylvania and Michigan to win the election.

For the last 35 years, New Labour did little or nothing for the old industrial working class. Work disappeared and, often enough, nothing came in its place, except humiliating low paid work, zero hours contracts and benefit cuts. Old vibrant workers’ communities transformed into deprived areas. Social welfare became punitive. Poverty and social exclusion increased (and exploded after 2010) and, with it, political exclusion, because from the moment social democracy stopped standing up for these groups, no else one did (see here and here). The strategists of the mainstream parties reasoned that, if the old working class/the old and the new unemployed/the precariat became politically apathetic, so much the better. Give them betting, football and drinking and in case that does not do the trick there is sheer repression, nationalism and xenophobia.

This is why UKIP was a blessing for the main political parties. UKIP was allowed to grow, it was never dangerous (it never had more than one MP in Whitehall), while, in the meantime, the sickening nonsense about Englishness and the ‘foreign crooks’ canalised popular disgust away from the real culprits, their neo-liberal policies, their austerity, their lack of elementary human decency, their lack of empathy, their eagerness to commodify the universe, their utter despise for the public world, their destruction of the welfare state, their perverted adoration for everyone who had money. At the same time, the march of the extreme right gave the centre the opportunity to present itself as democratic, open, inclusive, pluralist, in one word, decent. The ideological divide furthermore fulfilled the function of obfuscating how much the “centre” itself has evolved to the right. Mainstream parties have followed this strategy all over Europe. They have, of course, a point: Samson is better than Wilders, Macron is better than Le Pen.

The reaction of right wing Labour to the result of the Brexit has been appalling. Rachel Reeves and some other Blairites and the Fabian Society literally went as far as to state that, although xenophobia in the deprived areas – Labour’s now lost heartlands – is deplorable, politics is not about facts but about perceptions and beliefs and it is now time for Labour, as a democratic party, to accommodate these racists, otherwise, Reeves predicted, riots in Leeds could break out any day! Forget all this social democratic stuff about employment, equal chances, investment in infrastructure, industrial renewal, rebuilding the welfare state – what we need now are restrictions to immigration.

None of my socialist brothers or sisters ever bothered to ask which immigrants exactly, the answer is clear. No one says a word about the Russian oligarchs who buy up real estate in London, half a street at a time, buying citizenship en passant or the Saudi princes or any other plutocrats. No, it is the Polish plumber, the Romanian cleaning lady who ruins the UK economy. They need to go. According to Reeves and co., while not completely accurate, this view has to be respected because some people hold it. Why should Labour, which should stand for international solidarity, make life difficult for itself? And forget Left Labour protesting against this perversion. Starmer, the shadow secretary of Brexit, has been very clear: the era of free (EU) migration is over. This is how a great party goes to pieces. If you want an explanation for the calamity that befalls Labour look no further. Labour has no arguments for its Brexit and it is obvious to everyone. Corbyn cannot answer the question why he, a Leftist social democrat, supports a policy that will make the UK poorer and make things more difficult for those Labour is supposed to stand up for. Corbyn hardly ever talks about the EU because he has no interest in it and he knows nothing about it. His stance is simply based on his life-long aversion of EU membership. But people are not interested in this, nor do they accept it. What they want are intelligent arguments pro or contra, but arguments, not post-Brexit jobs and prosperity which will miraculously appear at some undefined point in time for a reason that can never be articulated.

Corbyn’s choice

This, grosso modo, is the political constellation that Corbyn inherited. Since September 2015, in less than one year, Labour won close to 200.000 new members. This enormous gain in membership was due to Corbyn gaining the upper hand, signifying the end of the dominance of New Labour. For the first time in decades, Labour, so it seemed, was ready to declare war on the Tories. But Corbyn has failed. Today, the disconnected, the deceived and the dismayed are as far away from Labour as they were two years before. The sole difference is that their numbers are now bigger than ever before. Labour is in complete shackles. No one honestly believes that Labour can win the general election. The ‘best’ (sic) that can be hoped for is that the humiliation will not be too extreme. Even that is highly doubtful. Rightly or wrongly, many people – and especially members of and voters for the Labour party, which of course campaigned to remain during the referendum – do not believe that the Brexit will do them any good. They continue to ask themselves, often in disbelief, why Corbyn stubbornly supports it. The argument that the will of the people has to be respected never made an impression on many because, rightly or wrongly, it is difficult to see the reason to respect a will which is the result of a campaign which constitutes a low point in political history and which is an affront to both honesty and intelligence.


Picture 1: this graph clearly shows that the support for Labour started to fall after the Brexit referendum when Labour made a U-turn and supported the leavers (source: The Economist).

It would of course have made a big difference if Corbyn could have based his position on some solid scientific analysis that proves the saneness and  the benignness of the Brexit, but no such studies exist. As Simon Wren-Lewis wrote today in Social Europe, the only fact the proponents could boast about was that (against predictions) consumption in the UK did not fall, indeed it rose after the referendum (see here). Last August, the Bank of England reasoned that consumers would recognise that the Brexit would lead to a significant fall in future income growth, and that they would quickly start reducing their consumption as a result. Much to the jolly amusement of the Brexiteers, consumption rose. But now, the latest figures (Q1 2017) show the slowdown. If consumption is growing, but other components of the GDP are not, it means that people are spending their savings. This is of course unsustainable. The estimate for 2017 Q1 GDP shows growth of only 0.3%, about half what the Bank had expected in February. This low growth figure appeared to be mainly down to weakness associated with consumption. Wren-Lewis concludes that we can’t say for sure, but that it seems that the Brexit slowdown has begun (see here).

It is not so important who is right and who is wrong here, what counts is the result of the general election. There is no doubt that a large segment of potential voters does not believe in the Brexit. Here we have the crisis of political representation again: for who is a left leaning pro remain social democrat supposed to vote? It is for a Labour party who campaigned to remain but supports May’s Brexit in the meantime?

It is also true that Left Labour defends the rights of EU immigrant workers in the UK, although then perhaps only in London and in the South. Why would the young urban multiculturals of the main cities in the UK, who to a very large degree oppose the Brexit, vote for Labour? Why would any of the EU immigrants (who have the right to vote in the local elections) vote for the Labour Party? Why is Corbyn supporting the Brexit, although it is simply mathematically impossible for Labour to ever win a general election again without making substantial gains in dominantly pro remain Scotland? Why would supporters of the Greens, which are overwhelmingly pro remain, vote tactically for Labour in some of the constituencies which could go either way in the election? Indeed, why would they, after Corbyn declared that no alliances would be made between Labour, the Greens and the Liberal Democrats in such marginal constituencies, although such alliances are the only chance to oust the Tories during the general election next month or at least to minimize the coming disaster? What is the reasoning behind that decision? No one knows. In short, there are not many groups left that Corbyn did not alienate.

Indeed, Corbyn even alienated the left wingers. Left Labour will deal with tax evasion, so it promises. Certainly, said McDonnell, but we need to realistic, a lot of income depends on the financial sector. Left Labour wants to re-nationalise certain former public services. Certainly, said Corbyn, but we need to respect running contracts. They will run for another 10 to 15 years. How long does Corbyn think he will be in power? Austerity has to reversed, certainly Corbyn says, but on the other hand, it is of course true that the UK’s budget deficit is now astronomical, so some austerity will be inevitable. Left Labour wants to raise the taxes on the rich. What is Labour promising more? Four new bank holidays. Incredibly, Corbyn and McDonnell’s programme includes nothing remotely as left wing as the £5 billion windfall tax on the utilities promised, and implemented, 20 years ago by Blair. This is not to say that the Labour programme does not contain good proposals. The contrary is true. It proposes some excellent measures. Labour promises to freeze taxes for 5 years for 95% of earners. Their position on the NHS is the only decent one. Labour wants free school meals for all children aged 4-11 (a very good proposal), a £ 10 per hour minimum wage, the renationalisation of the NHS, it wants to build 100.000 new council homes per year, it will reverse the Tory inheritance tax cut and the Tory corporation tax cut, end public pay freeze, end the gender pay gap and it will ban zero hour contracts for regular workers. All of that is great.


Picture 2: Labour promises to freeze taxes for everyone making less than £ 80.000 a year (Source: Institute for Fiscal Studies).

The problem is that the election has to be won. When a Labour MP finds it appropriate to begin her election leaflet statement with “Like Theresa May, I listened to what people said during the EU referendum (…)” you know that there is no real opposition left. It is precisely this that alienated the voters, their own voters to start with. The misconceived attempt win back part of the UKIP vote miserably failed.  Now Labour has nothing: it alienated those it could have won over by trying to bring back those it could not win back anyway.

At this point, it would be refreshing if Corbyn and McDonnell put their hands up and took even a small measure of responsibility for this calamitous result. They said they would win back Scotland, energise the Labour base, galvanise non-voters, lure back Ukip defectors and pull in Greens. Not one of those things has happened. The truth is – and I know this from many of my left leaning friends (and there is no reason to think that they are unrepresentative) – that people are desperate for an effective opposition to the Tories, that they are itching to vote Labour if only Corbyn would make sense to them.

Coda: social democracy’s future 

A lot has and is being written about the crisis of social democracy. We live in an utterly complicated and unfair world, a world of low pay and increasing gaps between the rich, the less rich, the poor and the very poor, a new world of blue, red and other plutocrats that are being kept into the saddle by an escapist middle class while rebellious plebeians struggle against a nearly silent majority. Unsurprisingly and inevitably, the result is ever increasing self-harm. This evolution is also crystal clear in the country I now live in. The Nordic welfare model, however, although it has been in decline and under attack, survived the neo-liberal onslaught. It has been hollowed out, become more restrictive, more business-like etc., but today the model continues to stand as one of the most impressive social achievements of humankind of all times.

Social planning became obsolete due to the impact of the barbarians – students no longer even know what it means – and social engineering become circumscribed past recognition. Globally, international organisations became junior partners of Wall Street and welfare became to be seen as the result of individuals operating on the free market, not by the mobilisation and the organisation of citizens (and non-citizens) that set up institutions for the benefit of humankind outside the control of the corrupt, the plutocrats and the robber barons. Since the 1980s, all these institutions and their social achievements have become the hunting ground for ravenous global adventurists, speculators and arrogant dictators who run parties, institutions and universities with the sole purposes of suffocating all critical thinking and making students pay obscene sums for an education which cripples the capacity to gain insight.

Remarkably, the social democratic state and its organisations survived this enduring onslaught – it is simply too good and, hence, too strong to break. Nowadays, it is not only doing relatively well, it is spreading its wings. Norway is presumably the most prosperous kibbutz on this planet, a twenty first-century New Lanark. In other parts of Europe, the welfare state also survived, although it went into hibernation and in some parts it is indeed comatose. What needs to happen now is very clear. Social democratic politicians need to stop being petits joueurs – small players playing it safe for small or no gains – because if they continue to play it safe their game will be up and the dragons that they unleashed will reap power.

The social democratic forces need to work together with everyone who shares its ideals, with everyone who is willing to act in defence of human dignity. The time of promising trivia is over. Only Norway has Statoil, but all other countries have productivity growth, increasing returns, social mobility and increasing human welfare – if the right leaders would run the country. The fight is not about a penny here and a penny there, but about organising the macroeconomic architecture in such a way that the economy works for everybody.

The world is changing and it is changing fast. The welfare state is no longer only a reality in the first world, it is not longer an imagined community, while it was and is under attack in the first world, it moved beyond its original borders into Africa, Asia and Latin America. It seems that the dusk fell over the European welfare state, only for the owl of Minerva to spread its wings. European policy-makers, in their infinite wisdom, should look at what is happening outside the borders of their stupid myopic and crumbling universe and appreciate how others deal with human development and human dignity. If they would – which they never will – they would notice, to their historical affront, that in other places birds are singing while the sun is rising in nascent social welfare states, while their own societies are being plagued by misery, dysfunction, graft and insecurity. It takes no courage and only a healthy aversion of hypocrisy. As long as no one stands up when Jean-Claude Juncker gives the EU a triple A for its economic achievements, adding that it also deserves a triple A for its social policies, we will continue to live in the Brezhnev era of the crumbling European neoliberal construction of dysfunction, its decreasing returns, its economic piracy of some on the back of all others. The stakes are higher than Corbyn or the Labour Party. One day, someone else will turn up and push things in the direction they should be going.