BRITAIN'S LABOR REGIME: PERFORMANCE AND PROMISE

...Governments of the democratic left are dedicated to the proposition that radical social change is possible within the framework of parliamentary politics, with the consent, however grudging, of the Tory establishment and without an immediate, wholesale expropriation of private industry and privately-owned land...

...Even the Labor government of 1945 to 1950, based though it was on an absolute majority in the House of Commons and backed, initially at least, by considerable public enthusiasm bowed out amid the economic difficulties which arose out of its devaluation of the pound and the outbreak of the Korean war...

...In October, 1964, a "surcharge" of fifteen per cent, later reduced to ten per cent, was levied on all imports except food and raw materials...

...The Conservatives had come to power in 1951 in reaction to the austerities of Labor's postwar managed economy...

...But the fact remains that he has grown in stature from being a clever politician to being a mature statesman...

...Which brings us back to Harold Wilson himself...

...Barbara Castle, only recently a left-wing firebrand and now at the Department of Overseas Development, has evolved a useful and enlightened scheme of interest-free loans for developing countries...

...as a result even the Conservatives lost faith in the power of the market to stimulate steady industrial growth, and began experimenting with various kinds of centralized and regional planning boards...

...The unconditional support given to the United States' policy in Vietnam is a major tragedy...

...It is in its activity and sincerity that Labor's second main asset lies...

...The assumption had been that rit Labor took office at all, it would do so for a full five-year term of office...

...Antony Crosland, another of the party's glamor eggheads at the Department of Education, is revolutionizing the teacher-training program, and may, given time, produce the first really effective onslaught on inequalities of educational opportunity in Britain...

...Very few people laugh at Frank Cousins, Minister of Technology and head of the Transport Workers' Union, who has not always strictly obeyed the conventions of Cabinet solidarity...

...He has lost none of his flair for self-projection and self-display...

...A government cannot impose punitive taxation in the name of "social justice" and at the same time expect private industry to go on producing the goods...

...Labor would encourage the industrial investment necessary to modernize key sectors of British industry and make them more competitive...

...For the first time in three years the pound is standing above the dollar parity of $2.80 in the world money market...

...But in domestic affairs the Labor government has made an attempt to put the commonweal before wealth, to restore dignity, seriousness, and even idealism to public life...

...The last few years of Tory rule produced an increasing cynicism on the part of the public towards politics and politicians...

...All of which, by way or preamble, should provide us with a few criteria for judging the performance of Britain's present Labor government after its first fifteen months of power...

...Such governments gain office in the more affluent and industrialized parts of Europe, or in the non-European extensions of European political culture, such as Israel and Australia, as well as in exceptional Latin American states...

...The payments deficit has been sharply reduced and James Callaghan, the Chancellor of the Exchequer, confidently expects it to be wiped out by the end of 1966...

...This array of tasks proved to be a crippling assignment...

...He loses no opportunity to dramatize the actions of government...

...Brown" as The Economist, which is not exactly a Labor organ, recently called him—is at work implementing the National Plan which, in popularized pamphlet form, became a minor best seller...

...They are vote-winners only insofar as they convince the British citizen that he has a serious government concerned with the right priorities...

...It is just possible that this stagnation will lead to some unemployment during 1966...

...The Labor Party was elected with a parliamentary majority of four over Conservatives and Liberals combined, a majority which was shortly afterwards reduced to two seats through a disastrous by-election in Leyton (East London...

...The government has also temporarily halted the wasteful construction of prestige office buildings in central London, some of which have been standing empty for years...

...But it took some courage to cancel contracts which the Conservative government had handed out to a vociferous and well-organized aircraft industry, and to say "no" to the demands of farmers for higher subsidies...

...By this he meant not merely that under Labor the government would play a more positive role in the economy, but that the state would be firmer in its dealings with private interest groups...

...Abetted by the British Broadcasting Company's late-night cabaret program, by night clubs such as The Establishment in London, and lampoon sheets such as Private Eye, Macmillan and his colleagues became the laughing stocks they mostly deserved to be...

...One of his first promises was that Labor would bring to the country "the smack of firm government...

...Add to that the fact that Labor ministers have shown a diversity of talent which has surprised many of the party's supporters...

...These are societies in which hatred of the rich, and alienation from the existing regime, are neither as widespread nor as intense as in the majority of "underdeveloped" countries...

...Labor could thus be re-elected and stay in power indefinitely...

...It is not merely that it risks defeat at the next election, before it has had time to enact all the decisive changes it has in mind, or even before the election if it rests on a coalition rather than one homogeneous party...

...Between the two world wars the experience of the German Social Democrats from 1918 to 1920, of Ramsay MacDonald's British Labor government from 1929 to 1931, and of the French Popular Front under Leon Blum from 1936 to 1938 illustrate this tradition of misfortune...

...But it has achieved this at the expense of almost every other policy item to which Labor was committed and which the electorate, including business, expected...

...During an election speech George Brown of the Department of Economic Affairs resoundingly dropped the hint of a three and one-half per cent mortgage rate...

...No liberal is entirely happy with the record of the Wilson government...

...It is in this first, overriding task of shoring up the pound that the government has, for the short term at least, achieved the greatest success...

...Few businessmen supported Labor openly at the election—that was hardly to be expected—but the business community in general showed a fair amount of goodwill to the new government...

...Moreover, many people attributed current governmental incompetence and technological backwardness to the excessive influence of gentlemanly amateurs at the top of the British social pyramid...

...Exports in the current year have increased eleven times more than imports...

...Here the government's record has been almost wholly good...

...In April, 1965, taxes were sharply increased...

...It took three major steps to dampen domestic demand, partly because this was inescapable, partly in obeisance to the high priests of sound finance on whose loans sterling became dependent...

...This does not, by itself, produce more houses, but it is a real short-term answer to real evils of extortion in many major cities, expecially London...

...bor was elected to office at a time when there was serious dissatisfaction with Britain's lagging industrial production, in a year which produced a record balance-of-payments deficit of $2.25 billion...

...The government was expected to restore foreign confidence in the pound sterling by methods presumably involving some deflation, to put right certain serious shortcomings in the social services by means including increased government expenditure, to maintain full employment, and to keep prices stable...

...Above all, George Brown at the Department of Economic Affairs—the "always dogged, sometimes clumsy, often irritating but extremely valuable Mr...

...The Conservatives' chronic inability to solve the balance-of-payments problem forced them to impose credit restrictions whenever the imports requirements of industrial expansion threatened to raise the imports bill...

...The government is presumably aware of this dilemma...

...The Profumo affair was merely the culmination of this process, and the public reaction to it the summing-up of this mood...

...Lord Gardiner, until a year ago Britain's top-earning barrister, has set up a permanent commission for law reform, not a remote or technical subject in an age when the citizen meets the government executive in so many ways almost every day...

...Their slogan was, "Set the People Free," and as late as 1959 they fought their most successful election campaign with the cry, "Conservative Freedom Works...

...he promises 500,000 houses a year by 1970, half of them in public housing schemes...

...It has always been to Labor's disadvantage that the Conservatives could accuse them of being a sectional party, devoted to the interests of a simple class...

...Thereafter, disillusionment set in...

...LaPETER PULZER is a tutor in modern history and politics at Christ Church, Oxford University...

...We are not likely to hear that one again...

...Almost the first act of the new government was to raise old age pensions by 18.5 per cent to four pounds ($11) per week, a recklessly generous gesture which confirmed all the bankers' worst fears of socialist prodigality...

...it has had less success in stemming money incomes, which rose eight per cent in 1965...

...The present rate of construction is 300,000 houses, less than forty per cent of them publicly provided...

...From the Labor side this image was not improved by a certain whining, underdog attitude towards the "establishment," by a somewhat apologetic, embarrassed stance when it found itself in power, as if a servant had been discovered trying on his master's clothes, and by the Utopian outlook of some of the party's left-wingers who found permanent opposition more congenial for the preservation of their ideological purity...

...In foregoing the luxuries of revolution, the democratic left severely limits its freedom of action...

...Labor's image, that of "white-coated" purposeful technologists, contrasted favorably with the Tory image of "cloth-cap" dilettante-ish, sporting squires...

...Denis Healey, at the Ministry of Defense, is beginning to ask economic questions none of his predecessors had thought of...

...It is difficult to see either the government or the parliamentary Labor Party prolonging the physical and nervous strain of working with a paper-thin majority much beyond the fall of 1966, although that will be far too early for . a definitive verdict on Labor's management of the economy...

...The index of industrial production in October, 1965, stood two points below that for January, 1965...

...A new Rent Act subjected most low- and medium-rental accommodations to rent review by local tribunals and gave complaining tenants reasonable security of tenure...

...Richard Crossman, once the intellectual enfant terrible of the party, and now Minister of Housing, is investigating industrial building methods...

...If Wilson does decide on an election this year he will not be able to rely solely on the claim of concrete achievement...

...In addition, private overseas investment was curtailed...

...Its concrete achievements are few so far...

...Politics and politicians are again taken seriously...

...The introduction of express freight trains on the nationalized railways, against the opposition of the unions whose members would lose the trucking monopoly at the terminals, is something that the Conservatives never dared to implement...

...The lead which Labor is currently enjoying in the opinion polls is attributable largely to the impression that "the pound has been saved...

...The restrictions on the economy have led once more to temporary stagnation...

...This body has already been successful in cancelling or postponing a number of price rises...

...The harsh, unpleasant measures could be taken at the beginning of the period...

...The closing-down of uneconomic coal pits under the nationalized Coal Board has, if anything, been accelerated...

...Before the election, the Conservatives made a great point of attacking Labor as a "one-man-band"—a line which gained some support from Wilson's habit of hogging the limelight...

...But the promise of further progress will probably suffice to give the Labor regime an increased majority whenever Harold Wilson asks for it...

...From the start, Harold Wilson would have none of this nonsense...

...But the Labor Party's Annual Conference did approve, in principle, an "early warning system" whereby the government could assume the power to have wage claims examined before they were submitted to the employers, and union cooperation of this kind is something that the Labor government of 1945 never achieved...

...But the Labor government also enjoyed certain advantages...

...The decision to limit immigration from the members of the Commonwealth to 8,500 persons a year is a surrender to racial prejudice...

...it is equally possible that countercyclical stimulants designed to forestall such unemployment may once again lead to excessive imports...

...For while the unpleasant measures necessary to save the pound sterling had to be taken immediately, the minute parliamentary majority would make it difficult to stay in power long enough for the candies to flow...

...These "stop-go" changes in money policy were as unwelcome to industrialists as they were to workers or house-buyers...

...True, something has been done in the area of social services...

...The man-in-the-street may not carry all these statistics in his head, but he is at least vaguely aware that the government has worked hard and won a few prizes...

...Harold Wilson embarked on his premiership burdened by a rather inflexible strategy...

...Neither the governments nor the populations of these more stable societies are prepared to risk the inconveniences and upheavals which would result from sudden socialization of all means of production, whatever the long-term benefits of such a revolutionary step...

...And while the government may be able to bully or blackmail internal economic antagonists, there is little it can do to coerce foreign holders of its currency who may be actuated by malice, prejudice, or even sincerely-felt prudence when they show their lack of confidence in a government of the left...

...Planning," however vaguely defined, had therefore become an acceptable word in Britain by 1964, and the type of state control that Labor was identified with was more fashionable than it had been for many years...

...Granted, the government's first task was to rescue the pound...

...In July, a six-month moratorium was imposed on certain types of large public-works projects...

...As long as the greater part of industry remains privately owned, it will continue to function in accordance with the profit incentive...

...Gold reserves are up and sizeable chunks of last winter's borrowings are being paid back...

...Nobody laughs at Harold Wilson...

...Nobody laughs at George Brown...

...Labor would channel funds into the desperately under-capitalized social services—public housing, schools, hospitals, youth welfare, institutions for the mentally disturbed and physically handicapped—a drearily familiar list in all Western "affluent" societies...

...it presumably knows that the right combination of selective import controls and selective investment stimulants can see Britian through...

...But, as the Duke of Wellington said of the battle of Waterloo, it will be a damn close-run thing...

...More surprising, and more refreshing, is the government's toughness towards those interests which had hoped for special protection...

...The other risk lies in the fact that economic power bestows political power...

...he will, instead, have to ask the electorate to judge his government on its energy and the sincerity of its intentions...

...They generally come to power at moments of military or economic crisis, and collapse as a result of the further deepening of that crisis...

...As things turned out, this strategy conceived before the election, was made perilous by the closeness of the election itself...

...the candies could be handed out at the end...

...From the political standpoint the trouble with all these admirable schemes is that they either lack mass appeal or that they cannot, in the nature of things, show quick, spectacular results...

...Britian does not face "military-industrial compexes" as vast as America's, nor "private governments" as deeply enmeshed in the political machine as are some of the lobbies in Washington...

...Most important of all, it appears there may be genuine and successful support by the unions for George Brown's Prices and Incomes Board...

...He is clearly determined to transform Labor into Britain's natural majority party...

...Every silver lining, however, has a cloud...

...Without it, all "economic planning" is a mockery...

...As long as major corporations, banks, and insurance companies remain in private hands they have it in their power, at best to evade, at worst to sabotage, some of the edicts of the government...

...But none of this is going to enable the government to make a noticeable impact between now and the next election on the general housing shortage—nor to make good its promise to the middle-class house-buyer, haunted by rising land prices and high interest rates, to make borrowing easier...

...Labor, it was assumed, would finally abandon the wasteful frustrations of the Conservative "stop-go" credit policies...