WHAT LABOUR DID IN OFFICE: AN EXCLUSIVE REPORT ON BRITAIN'S 1988 ELECTION

...One object of these schemes was to generate high-quality managers and planners, especially for the public and government sector...

...The half-time provision introduced a more flexible approach to the final years of work and was accompanied by a small offsetting increase in part-time employment beyond the age of 65...

...This required research into the effects of the impersonality of very large schools, and it might require, in the most difficult areas, much better staffing ratios (perhaps making use of auxiliaries) than were then the norm...

...The most radical step taken by the new government was a commitment to provide a year's employment to everyone who had been registered as unemployed for over six months...

...Programs would be provided alternatively by the BBC or new regional public stations, out of license income or by commercial providers using advertisements on the lines of the existing independent television companies...

...THE GOVERNMENT SUCCEEDED in holding together for four years, and went to the country in 1992 under the new Proportional Representation system...

...A new Industrial Research Agency was given a substantial budget, which could be allocated either on a "matching-grant" basis to private or public corporations, or as smaller grants to academic institutions pursuing technological projects prior to their direct industrial applications...

...Labour was to some extent protected by its Coalition partners from accusations of socialist extremism (once it had been clarified that the government aimed to last the full term, and that its members would not openly discredit each other...

...After so many years of strident "possessive individualism," the country was now receptive to a more ethical and integrative approach...

...There was also an interesting suggestion for the appointment of neighborhood street wardens, perhaps paid out of the police budget, as a low-cost form of community policing, or under the jurisdiction of elected neighborhood councils...

...In taking problems of "law and order" seriously, the authors of the report attempted to turn conservative anxieties that are focused on the decline of moral community life into support for positive social policies...

...The government this time wisely chose to spend its early capital on political measures rather than on inflationary wage rises, as Labour had done in 1974...

...This Royal Commission had as members some of the leading figures of recent radical debate on mass communications, as well as practitioners...

...Unlike Mondale in the 1984 American presidential election, faced with a comparable preelection boom and budget deficit, the opposition parties in Britain did not denounce the deficit as irresponsible but said it was too little and too late...

...These were related to the idea that the trade unions should develop a more positive role in industrial planning and management...

...The encouragement of voluntary early retirement— for example by a scheme that conferred a right to a reduction of working hours to half-time at the age of 60 for those who had been in employment with a firm for more than five years—also had a favorable effect on employment figures...

...That decided the issue, and soon afterward the Labour prime minister announced that the government would introduce legislation to provide for the next general election to take place by Proportional Representation...

...How Did the Government Succeed...

...The commission also recommended generous government funding of an enlarged National Film Finance Corporation, whose aim was to secure a long-run expansion through education, training, and direct investment, of film- and program-making capacity...

...The key gain for the Alliance, and especially the Liberals, was the adoption of Proportional Representation, and for this they were prepared to make significant concessions...

...It also set up a smaller Cooperative Investment Bank, to encourage worker-ownership...

...On this basis, significant reversals of Thatcher legislation, notably over public ownership, were carried through in key sectors...

...One of these was a Royal Commission on the Press, whose terms of reference included the issues of monopoly powers, quality, and democratic access...

...Regional Employment Commissions were set up, on a tripartite government, industry, and union basis, to develop productive employment...

...While the Labour party increased its share of the poll by 7 percent from the 1983 level, to 35 percent, this was not enough to give it a clear majority...

...Because policy differences were argued between competing parties, rather than in the secrecy of the cabinet, it proved possible for the Labour party to hold its leaders to their declared policies...

...Some thought it would be a harmless diversion for radical intellectuals to involve themselves with such long-term programs instead of the contentious problems of the present...

...Employment and the Economy EMPLOYMENT POLICY was the first priority for government action, since it was mainly on their failures in this area that the Conservatives had been defeated...

...The book is available in the U.S...

...The dominant issue was unemployment, as it had been for two or three years prior to the election, since the end of the miners' strike...

...Another factor leading to this tougher government attitude was the less-than-happy experience of some Labour metropolitan authorities with their own town-hall unions...

...While no majority existed in Parliament for the repeal of legislation requiring ballots for strike action and for the allocation of funds for political purposes, the improved status of the trade unions under the new government, and recognition that their restraint was vital to the new reconstruction, made it easier for some unions to retain their members' support for political funds...

...The government attempted to meet criticisms from the left of "bureaucrat449 ism" and "corporatism" by making possible trade-union participation in the regional development agencies and training bodies, and by giving some support to workers' cooperatives and buy-outs of divisions of private companies threatened with closure...

...The Proportional Representation issue was left in abeyance for two years, but at the end of this time the Alliance announced its intention of fighting a cluster of three forthcoming byelections wholly on this question...

...following Chernenko's death had also brought some improvements in the Eastern-bloc economy, where there was considerable unfulfilled potential blocked by inefficiency (and more room for rapid improvement than in the West...

...It also introduced a new form of short-term civil-service contract, to coincide with the life of a Parliament, and declared the intention to use this to increase the expertise and "industrial experience" of civil servants...

...Its principal recommendations were a stringent antimonopoly rule, which prohibited the ownership of more than one national and Sunday newspaper, and more than one local newspaper operating in a given area, by the same company...

...As so often before, the election was won and lost in the two or three years that preceded it, and not during the campaign itself...

...These subsidies were set at something less than the estimated exchequer cost of each unemployed person, in unemployment benefits and foregone tax revenues...

...These removed lower income groups from income-tax liability and made the tax system somewhat more progressive again...

...But the main result of the dependence of Labour on the Alliance was the impossibility of restoring the trade unions' previous privileges...

...On the capital side, it proposed a more equitable distribution of capital, both individually (an extension of worker share-ownership schemes and regional extensions of the investment bond idea) and collectively, arguing that trade-union or other workers' representatives should have more say in decisions on pensionfund investment...

...The government said it had little to give away because of the priority of industrial reconstruction, but that it would, unlike its predecessor, be fair...

...The Constitution IT WAS CLEAR AT THE OUTSET of negotiations between the coalition partners that Labour was not willing to concede Proportional Representation, and would go ahead with a minority government if the Alliance insisted on making that a decisive issue "at this stage...

...In practice, as intended, this was used in part to increase the role of political appointees in government...

...The government announced that it intended to divert industrial research capacity from defense to civilian purposes...

...It also proposed significant tax-exemptions for newspapers operated as nonprofit trusts...

...This proved a successful way of preempting neoconservative concerns over the family...

...The most important factor contributing to the government's success had been the radically reduced expectations brought about by the Thatcher years...

...To this extent Thatcherism had had a lasting effect...

...The government wanted to avoid charges of government secrecy and elitism (it had legislated on Freedom of Information, sensibly en448 trusting this issue to a Liberal cabinet member), and therefore it favored this greater openness...

...The return of a minority SPD government in West Germany, dependent on Green support or abstention, also made it imperative for the West to adopt a more conciliatory stance toward the U.S.S.R...

...These might be necessary deterrents, the report said, but they certainly do no good to the inmates...

...A Royal Commission on the Family—with membership drawn from single-issue campaigns in the welfare field, the personal social services, and the churches, and including some prominent feminists—recommended improvements in family support services (day care, domiciliary care for the old, and an infant/ child benefit allowance for parents of underfives), on the grounds that these would strengthen rather than weaken family structure...

...Surprisingly, the Coalition was less liable to retreat on policy than the previous Labour governments had been...

...Trade-union membership also began to grow again as unemployment diminished, a not 445 insignificant gain...

...There was widespread recognition that these investment measures could only be effective given time and that, at the very least, Labour, with or without the Alliance, must aim to remain in office for at least two terms...

...The structure of the permanent civil service and local government services continued only little changed, but these new appointments were a significant innovation in highpriority areas, such as industrial development, and in strengthening the planning resources of ministers...

...David Steel, the Liberal leader, showed an explicit willingness to discuss coalition with Labour, and this probably encouraged Alliance voters to vote Labour in areas where Labour had previously come in second to the Tories, especially where there was a Social Democratic rather than a Liberal candidate...

...And a requirement of shareholders' ballots to authorize company gifts for political purposes reduced company funding of the Conservative party...

...The more political and corporatist role the trade unions have taken in the more stable European social democracies (Sweden and Austria, for example) came to England as the best option available to the trade unions after the hammering they had taken from Thatcherism...

...These were linked with an increase in expenditure on the National Health Service, but were also seen as the most costeffective means of improving health...

...Like lollipop men and women (part-time wardens at school crossings who direct traffic with lollipop-shaped signs), the report said— the posts might suit retired people (anyway in quieter areas...

...Funds were made available for paid educational leaves and for an expansion of one-year full-time trade-union education programs...

...in September...

...Since Thatcher and her supporters for the time being retained their dominant position in the Conservative party, there was little alternative to some kind of coalition...

...The problem in pursuing this preventive approach to health and social order was how to make statistical improvements as meaningful to the public as is the individual case of a heart transplant or an exemplary penal sentence, which gains more media attention and distorts resource allocation...

...Labour gained some credit for the introduction of this idea of popular shares in industrial wealth, having been so badly outflanked by the Conservatives over council-house ownership...

...The government chose to concentrate on investment in "sunrise" industries and new technologies, and gave as one reason for this the need to earn enough to ensure a proper return on savings to bondholders (though in practice the fixed-interest return was guaranteed by government...

...It turned out that the earlier class alliance of workingclass equalitarianism and "new-middle-class" public rationality was still viable against a background of Thatcherite devastation...

...The sixth of this unexpected series of Committees of Inquiry and Royal Commissions (government by sociologists, said some Tories) concerned policing, crime rates, and penal policy, especially in relation to inner-city areas...

...The key test, the government stated later, was whether preventive measures could reduce crime rates, and it set up a fuller and more public monitoring system, by local-government area, to test this...

...Protesting that it was determined not to "run out of steam" after one term, the government began to set up a number of Royal Commissions and Committees of Inquiry to .make recom446 mendations in a number of areas it deemed important...

...There was also a provision for a tax penalty for firms who paid over the odds, which in practice was sparingly deployed...

...The government meanwhile took steps to reduce the prison population and attempted to redirect resources in the direction of preventive action...

...In accepting these recommendations, the government announced that it wanted to preserve the existing "mixed economy" in broadcasting, but with a greater diversity of channels, to ensure that all citizens retained access from their basic license fee to all programs...

...On the other hand, monetarism had been wholly discredited, and as a result of the Thatcher defeat it was possible for the government to give priority to the production of goods and services, over the financial sector...

...Labour improved its share of the vote by a further 3 percent, to 38 percent, after this period of fairly popular and constructive government but, of course, under the PR system it finished up with a lesser number of seats, though still as the largest single party...

...The National Investment Bank (NIB) was close in its conception to the earlier National Enterprise Board, but there were competing pressures on it for the allocation of its capital resources...

...The Labour party used the alternative option of a minority government, followed by an early dissolution to force optimal terms out of the Alliance...

...Closely linked with the hi-tech role of the National Investment Bank was a considerable expansion of the funds provided for technological research...

...While Mrs...

...Agreement was also reached that no nuclear weapons would be deployed on U.S...

...This produced recommendations for a "public-highway" concept of cable, funded by license fee, in which the basic technical infrastructure would be funded through British Telecom...

...There were now nearly 4 million unemployed, and there had been further innercity riots in 1986...

...But the TUC, battered after nine years of Thatcherism, was prepared to accept this (under another name) as a trade-off both for the employment-creation programs and for the return of the trade unions to a more prominent public role...

...This bargaining card enabled Labour to take a strong position within the Coalition, and the benefit was a significant recovery in its share of the vote...

...As the defense secretary said, "the one good thing about having missiles on trucks is that they can go out as quickly as they came in...

...Since these elections did not endanger the government's majority, and the Alliance said it would engage in no anti-Labour campaigning other than on this issue (Labour had successfully insisted from the first on abstention from antisocialist speech-making as a condition for Alliatice members remaining in the government), this was an ingenious strategy...

...The government succeeded in appropriating some populist themes that Thatcherism had made its own...

...While Alliance "intransigence" was exploited on some occasions as an excuse by the Labour right to abandon positions they did not want to defend anyway, Labour generally remained aware that it had to look after its own constituency first...

...The success of the Australian Labour government's program of an incomes policy for economic expansion had increased the attractiveness of this option in Britain...

...The government set up a National Investment Bank, as had long been proposed by the Trade Union Congress, and offered tax-free bonds to the public as a way of raising capital for it...

...They were seen as long-term agenda-setting and educational devices...

...or British aircraft based in the U.K...

...It was a classic case of a "public good...

...The government decided that a declaration of principle of this kind was required, especially if it were to succeed in obtaining the 443 cooperation of the unions for some kind of de facto incomes policy...

...Since many of these programs were of their nature long-term and would require more skilled workers in the construction (and related) industries, it was also agreed to link the existing Youth Training scheme and other new vocational training programs more closely to the expected manpower demands of these schemes, thus lessening the pointlessness of training where there were no employment prospects...

...Thatcher had in 1987 introduced substantial tax cuts, and a much less substantial capital spending program with the declared aim of "tackling unemployment now that we have conquered the problem of inflation once and for all," this was perceived by most as unconvincing and cynical...

...The Labour party gained in organizational strength through the establishment of public funding for parties, and through the new regional authorities, and the TUC gained in authority through the government's return to "tripartism...

...A Royal Commission was also set up on taxation, which made recommendations for a drastic simplification of the tax and benefit system, and for a negative income tax to replace the existing host of means-tested benefits...

...q 450...

...These wardens would patrol a few streets where they lived, getting to know the neighbors, and report on "suspicious circumstances...

...but the exchange rate was too vulnerable to non-trade-related speculation to be an adequate instrument on its own...

...Similar measures were taken at localgovernment and regional-government levels...

...It argued that the indirect benefits of cable—through interactive home shopping, travel booking, and other information services where additional charges could be levied through the use, not the reception, of information—would more than justify the "free" provision of the basic service...

...For the first time this provided tax advantages for lending to industrial investment (with a ceiling of £40,000 per person), to offset the advantages hitherto given (via the tax relief on mortgage interest and other tax exemptions for owner-occupied dwellings) to domestic property...

...The impotence of the unions under Thatcher, and the number of severe industrial defeats they had suffered during that period, had produced a shift of emphasis from tradeunion to political means of advancing workingclass interests...

...The peace movement was persuaded to acknowledge this as at least a step in the right direction by the commitment to remove Cruise missiles from Britain within six months...

...Labour lost one seat to the Liberals on this issue, and lost votes in the other two constituencies...

...This committee investigated a range of environmental, occupational, and preventive health problems, and it made recommendations in a number of areas, including infant mortality and malnutrition, deaths and 447 illness associated with tobacco (no more advertising or sponsorship), road safety (including more stringent legislation for the design of vehicles and on driving and alcohol), heart disease and diet...

...The international climate had fortunately improved, as a result in part of a realization that the arms burden was damaging Western economies and the political stability of their governments even more than those of the Eastern bloc...

...It wanted to establish "benchmarks," it said, so that we can know how much progress we have made after five years in improving the health of our people...

...Having staked so much on her "prudent housekeeping" approach to government spending, it was difficult for Thatcher to reverse course just before an election...

...In a typically francophile SDP touch, a remark in the report commended the social role of the concierge...

...This in turn produced greater pressure and stimulus for competing economic expansion in Western Europe...

...Another commission worked on the subject of the production and distribution of television and film, including cable...

...These programs were related to the increasing number of old people in the population, aiming to provide better social infrastructures for community care...

...The advantage to Labour of delaying the passage of decision on PR until late in the session of Parliament was that the Alliance dared not risk the defeat of the government until it was passed...

...The Regional Commissions were also authorized to allocate specified funds for short-term employment subsidies to private firms, depending on the level of unemployment in each region...

...The major industries denationalized by the Thatcher government—British Airways, British Telecom, et al.—were retaken into public ownership...

...It predictably supported "community" concepts of policing the stability and improvement of neighborhoods as likely to lead to less crime and insecurity...

...The introduction of a universal education and training allowance for 16- to 18-year-olds, as Labour had proposed while in opposition, effectively removed this age group from the employment rolls...

...Realizing the shortage of skilled management, especially in the public sector, the government also introduced funding for postgraduate sandwich courses in a number of institutions, by which economics, business, and engineering graduates could take programs in conjunction with placements in industry or in public economic agencies...

...These reports and investigations succeeded in winning public attention through their use of public meetings, and especially of radio and television, for their hearings...

...Alliance or Labour candidates seemed to have the best chance of winning...

...The government also instituted state funding for political parties represented in Parliament (in proportion to their share of the vote), and increased the funding for the staff and office expenses of MPs...

...Since some tangible progress was being made in limited arms reductions, the government was not much attacked from the left on defense issues...

...It took reserve powers to impose an import license system, whereby importers would have to pay a sliding-scale premium for foreign currency purchases that would vary depending on the balance of trade in each quarter...

...These programs, and their multiplier effects in the economy, did bring a reduction in unemployment of 1.5 million in just over a year...

...It was agreed to expand community and health-care services, as part of an expansion of preventive and community medicine...

...It was not, as some on the left said after the second election victory of 1992, socialism, but at least it was a move forward again...

...In a major report, the commission argued that the breakdown of social relationships was the crucial factor generating crime and disorder...

...The Labour party did not forget in these years that concern for working-class living standards was the precondition for its unity and electoral survival...

...This combination of an active welfare policy, an equal-rights approach to gender, and a positive approach toward the family in its variable forms won mainstream support...

...It argued that attention needed to be given to the quality of relationships established between teenagers and teachers and other involved adults...

...This and internal changes in the Labour party after 1979 strengthened the role of the party vis-a-vis the trade unions in the labor movement...

...It seemed a way of strengthening community ties and information, where these were lacking...

...The excerpt appears with the permission of the publisher, Verso...

...Important measures in winning workingclass support for the government were its first budgets...

...The Government and the Intellectuals: Reinvention of the Royal Commission THE GOVERNMENT SUCCEEDED in wedding the radical intelligentsia more firmly to its cause than had its Labour predecessors, both by the recruitment of advisers and the reinvention of the Royal Commission after a long period of disuse of this institution under Thatcher...

...It also helped achieve an increase in the rate of capital formation in the early years of the new government without inflationary effect...

...These developments also produced more positive attitudes in the Labour party toward the Common market...

...It was agreed that the only nuclear weapons to be retained on British territory would be seaborne, and the objective was to transfer this force as rapidly as possible to joint European command...

...in Europe, and also made a more expansionary economic approach possible in the EEC...

...The government sought to maintain the lower value of sterling against other currencies, in order to encourage trade competitiveness...

...It also recommended specific measures to protect women (for example, the collection through the tax system of the contributions of deserting husbands for the maintenance of their children...

...These commissions were to propose capital programs (railway insulation, sewer reconstruction, house repair and neighborhood improvement, railway electrification, upgrading of provincial airports, the hydroelectric Severn Barrage tidal dam, and so on...

...If we hadn't gone over to PR, we might have won outright," said left critics, but it was clear that these results couldn't be fairly extrapolated to that situation...

...The import-license 444 scheme was invoked after nine months, to head off an impending balance-of-payments crisis...

...The larger the numbers who had access to these systems the lower the average cost, and the more activity they would generate...

...Living standards of those in work only improved slightly in the first three years of the government (more rapidly in the preelection period...

...It urged attention to the design of public space, including council estates (local government-funded housing), to prevent areas of dereliction...

...The BBC and the national theater companies show that public funding can work, said the government...

...Since this was thought likely to improve the efficiency and thus the defensibility of the public sector in the long run, this concession caused little controversy...

...By holding public hearings, which attracted considerable participation and publicity, it was able to generate political debate (distraction, some said) parallel with the government's more immediate activities...

...The trade unions were co-opted into the Regional Employment Commissions, and at more grass-roots levels some energies were diverted into Alternative Plan initiatives supported by the new Cooperative Bank...

...This commission brought together one or two of the more liberal police commissioners and prison wardens, civil rights lawyers, and academics, with some representation from the immigrant communities...

...The Liberal/Social Democratic Alliance also gained an additional 2 percent of the national vote, and there was evidence of considerable party- and vote-switching where This is a slightly condensed and adapted version of the Afterword of For a Pluralist Socialism, by Michael Rustin, copyright © 1985 by Michael Rustin, and published in May by Verso in London...

...Economic growth of 6 percent was achieved in the first year of the new government (the Thatcher government having only managed a level of 2.75 percent in its last full year), and 5 percent in the second...

...An incomes policy was made a condition of the formation of the Coalition...

...It pointed out that the switch from comprehensive redevelopment schemes to piecemeal housing improvement might already be reducing problems associated with rapid social transition— problems of loneliness and mental illness as well as vandalism and crime...

...The Liberals made more of the running in the Alliance than in 1979, finding it easier in the more strongly antiThatcherite climate, and David Owen, the leader of the Social Democratic party, was made less effective by his earlier endorsements of aspects of the Thatcherite philosophy...

...The most important of these was democracy and "letting the people decide," through a return to greater autonomy for local government, and through regional and local decentralization...

...The official departure of the Cruise missile was the occasion of a large peace festival...

...There are higher priorities," said the Labour party, and "in any case, if the electorate had wanted this they would not have voted for us as the largest single party...

...The import licenses were intended as a trade-balancing measure, and defended as nonprotectionist in the sense that there would be no tariff when trade was in balance...

...The commission recommended the strengthening of community cohesiveness through the decentralization of council services, and it supported the proposal for establishment of elected neighborhood councils with small spending powers, in the hope that this would increase community integration...

...Encouragement was also given to voluntary organizations in these areas, on the grounds that these were a low-cost way of improving social welfare, and that the more expensive professional workers should be deployed to make the greatest use of these resources...

...The report argued for a preventive law-andorder philosophy, pointing out the documented cost and futility of prisons and other custodial sentences...

...The TUC negotiated a two-year agreement providing that wage increases should not exceed 1.5 percent of the going rate of inflation during that period...

...Moves to economic decentralization in the U.S.S.R...

...The prime minister's position was also weaker under this more pluralist arrangement, and this gave the left more leverage, within the overall limits of Coalition policy, than it recently had when in office...

...Tax relief on new mortgages (and after two years on existing ones) would be limited to relief at the standard rate of tax...

...from Schocken Books, Inc., and it will be published in the U.S...

...Themes of reintegration of the community, of decentralization and democratization, and of consistent but slow rebuilding of the economy succeeded in maintaining majority support...

...But the emphasis on the values of community, concern for the value of life in preventive health care and welfare schemes, and social support for the family also engaged some sentiments recently orchestrated most effectively by the right...

...They would have lapel radios, to enable them to call for help and to protect them from assault, and residents would be encouraged to tell them when they were going away...

...Foreign Policy THE NEW GOVERNMENT WAS ABLE to reach agreement on a philosophy of minimum nuclear deterrence, combined with the preservation of military "balance" with the East...

...The commitment to investment and growth and a continuing rhetoric of efficiency in the public services also paid tribute to the revival of market values, though the government's employment-creation schemes and mildly redistributive tax policies made it vulnerable to the usual criticisms of diminishing "incentives" and waste of public resources...

...Trade Unions THE LABOUR PARTY FACED a real problem in how to fulfill the interests of the trade unions while in coalition with the Liberals and the SDP...

...The government also set up a Committee on Community and Preventive Health, saying that it wanted to set positive goals for the improvement of public health standards...

...There was a small increase in the basic rate of income tax...

...A major condition exacted by the Liberal/SDP Alliance was an insistence that a measure of competition with the private sector be preserved in each case...

...At all events, these committees did generate a momentum of new issues and recommendations, and showed that this venerable constitutional instrument could be adapted to more democratic times...

...but there was a substantial improvement in the living conditions of the previously unemployed, and necessary capital formation was generated in both the public and private sectors...

...After the 1992 election, the SDP and the Liberal party merged...

...The new government devalued the pound, reimposed exchange controls upon assuming office, and greatly restricted outward movement of capital...

...With some success it devolved the task of short-term employment creation to the Regional Employment Commissions, shortly to become part of elected regional authorities...

...If inflation was to be contained, it was understood that social justice had to be pursued through the tax system...

...While one effect of this was simply to divert savings from building societies to the new fund, it did increase net savings...