“On the day she became the most powerful woman in the history of British democracy, Barbara Castle wrote: ‘I am under no illusions that I may be committing political suicide.’” Appointed by the Labour prime minister Harold Wilson as secretary of state for employment and productivity in 1968, Castle was tasked with making an incomes policy imposing mandatory controls on wages and prices acceptable to trade unions and her party. If the two sides could not reach agreement, she observed in her diary, the result would be to “put social democracy out of office in Britain for the next 20 years”. Months of frustrating negotiations with unions and employers convinced her that radical reform of labour relations was needed.
In early 1969, Castle’s white paper In Place of Strife was published. Intended to legitimate trade unions by bringing them within a framework of law, the paper included proposals requiring strike ballots and cooling-off periods. Attacked by the unions, the left and the free-market right, Castle’s proposals were shelved. She secured her place in history with the 1970 Equal Pay Act, which she introduced after intervening in a strike by women operating sewing machines in the Dagenham Ford plant. But her career as a leading Labour politician was finished. She served in Wilson’s second government, but when her long-time enemy James Callaghan replaced Wilson as prime minister in 1976 he curtly sacked her. Never again was she close to power.
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Castle spent the rest of her long life (1910-2002) using her penetrating intelligence to expose flaws in her party’s ruling orthodoxies. Her warning that Labour faced a 20-year setback was more than vindicated. Following Margaret Thatcher’s victory in 1979, the Conservatives were in government until 1997. Endorsing Thatcher’s programme, Tony Blair and Gordon Brown were in government until 2010. In an interview published in the New Statesman in February 2000, Castle savaged New Labour for its embrace of “market economics, globalisation and the dominance of the multinationals”.
Appearing in the early sections of The Death of Consensus: 100 Years of British Political Nightmares as Barbara Betts, the name she bore before marrying the Labour politician and journalist Ted Castle in 1944, Castle is one of the most consequential figures in Phil Tinline’s account of a century of British politics. She grasped that unimaginable changes in labour relations had become unavoidable; but they could not be implemented because they breached the ruling consensus. The unions regarded any attempt to regulate them as a move in the direction of interwar European authoritarianism. Castle’s reforms were blocked by the power of nightmare. A decade later, the consensus cracked and Thatcher became prime minister.
As Tinline sees it consensus is not, in itself, an especially helpful idea: “A period of consensus might best be defined as one where there is agreement, at least, on what to reject. Modern Britain’s past periods of consensus have centred on a shared understanding, whatever the differences between political parties, that something was unthinkable; budget deficits, mass unemployment, inflation, strikes. These were the limits that shaped the politically possible. Those who accepted them did so for very different motives: for some it was belief, sympathy, or the scars of personal experience; for others, just building a political career. And these periods of consensus were more of a strained compromise… This meant they could hold only for so long.”
Never complete or without tensions, consensus in politics fractures when a dark future becomes – or seems to become – a real prospect. As these nightmares grip the imagination of politicians, the media and voters, the parameters of what is judged possible shift.
Tinline, a radio producer whose documentaries include the award-winning BBC series Document, tells his story in three time periods: 1931 to 1945, 1968 to 1985, and 2008 to 2022. He begins the first section with the future prime minister Harold Wilson almost dying as a result of a taste for custard. Born in 1916 in the “cramped little industrial town” of Milnsbridge near Huddersfield, Wilson was awarded a place at Oxford in 1934. He was lucky to live long enough to win it. In September 1930, while on a Scouting holiday, he bought some toxic milk from a farm and contracted typhoid. Eleven others caught the disease from the milk, and six of them died.
For his family, which rang the hospital every evening from a call box for news, the experience was “a nightmare of anxiety”. The larger nightmare was mass unemployment. Days after he heard his son’s condition was improving, Harold’s father, Herbert – an industrial chemist – was sacked, joining 2.5 million other unemployed people in Britain. If, after 18 workless months, Herbert had not found a job, Harold would have had to leave school at 16, give up any idea of university and go to work in his uncle’s umbrella factory.
The first collapse of consensus occurred when a Victorian economic orthodoxy foundered during the Great Depression. In classical economics, the belief is that free markets revert to a benign equilibrium if left to themselves. The Wilsons’ MP, Philip Snowden, chancellor of the Exchequer in the minority Labour government, shared this tenet. Cutting wages, taxes and government spending was the only way through the slump. The effect was to worsen an already disastrous situation.
Others had different remedies. The former Liberal prime minister David Lloyd George urged an emergency programme of public works. Among the Tories, Stanley Baldwin and Neville Chamberlain favoured protectionism, while Harold Macmillan was a disciple of John Maynard Keynes. In his General Theory of Employment, Interest and Money (1936), Keynes destroyed the classical theory in which markets were self-stabilising. But any breach with the past was taboo for Labour. It took the full employment secured during the Second World War before a new consensus was accepted.
The second part of Tinline’s story tells how the postwar consensus began to crumble in the industrial strife of the 1960s and 1970s – the story of Barbara Castle. The third deals with the break-up of the Thatcherite consensus, set in motion by the 2008 financial crash and still under way in the aftermath of the pandemic.
Packed with arresting detail, The Death of Consensus is one of the most original and enjoyable books on British politics to have appeared for many years. Phil Tinline’s narrative of competing nightmares is compelling. Politics is not simply a clash of interests and ideas. It is also a collision of dreams, sometimes presaging better futures, but more often disaster and ruin. How these dreams shape history depends on the paths leading actors choose, or find themselves forced into.
If Labour had enacted Castle’s In Place of Strife, history would surely have been different. Neoliberalism would not have achieved a generation-long dominance in the Conservative Party, while New Labour would not have been conceived. Globalisation and market forces would still have advanced in China and other countries, eroding the postwar settlement in Britain. But the political response in this country would have been more muted and nuanced. Even if Thatcher had become prime minister, nothing like “Thatcherism” – a combustible mix of neo-Victorian morals with socially disruptive free markets – would have come into being. The Eighties as we knew them would be the stuff of science fiction.
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The quasi-Marxian image of Thatcher as the embodiment of an inexorable process of capitalist modernisation, which thrived incongruously in the right-wing think tanks for many years, was never more than a phantom. At the same time, it was difficult for Labour to implement Castle’s reforms, which would have involved a war with the unions her colleagues were unprepared to wage. If Britain’s industrial deadlock was to be broken, it had to be done by the Conservatives. Underneath the shifting nightmares, this was the logic of events.
Thatcher came to power in 1979 after the Winter of Discontent, but a Thatcherite consensus became entrenched owing to a sequence of contingencies. Privatisation did not appear in the 1979 Conservative manifesto apart from a commitment to sell off the National Freight Corporation, a road haulage firm which staged an employee buyout in 1982. There was no mention of free trade, only a demand for “Fair Trade”, which left plenty of room for intervention. Thatcher’s most radical policy—and her most popular – was giving council tenants a legal right to buy their homes under market value. The Falklands War in 1982, a victory that could easily have been a disaster, and North Sea oil revenues, which were spent largely on tax cuts, helped consolidate her at times shaky authority. The nightmare of a return to interwar authoritarianism never became reality. Today, neo-Thatcherites are possessed by visions of Britain returning to the 1970s.
As in 1979, the nightmare of industrial anarchy works to the opposition’s advantage. With a summer of discontent looming, a Labour-led government is the logic of events. Unlike Thatcher, Keir Starmer – whose boring persona may be turning into an electoral asset – is bent on propping up the old consensus. Another iteration of Blair’s neo-Thatcherism appears to be his goal. Johnson looks like reverting to an earlier stage of Thatcherism. Unless a senior cabinet minister breaks ranks and challenges him, he will almost certainly lead the party into the next general election. Possibly opting for an early election next year, he may run on a paleo-Thatcherite agenda of extending the right-to-buy to housing associations, as already announced, and cutting taxes. Whether this would avert the crushing defeat many Tory MPs fear is doubtful. Whatever the result, neoliberal hegemony will endure.
Here the ironies of Brexit are key. If they had been rational, Thatcherite free marketeers would have supported Remain. Shaped over past decades into a neoliberal structure in which flows of capital and labour have been removed from political control, the EU is the biggest free market in the world. There was never any realistic possibility of European institutions being reformed to be made more democratic. Those on the left who wanted collective management of the British economy should have voted Leave.
It is a pity Tinline does not tell the reader more about the social democratic tradition of Euroscepticism represented by Peter Shore and Castle until she accepted the result of the 1975 referendum and became an MEP. It is unfortunate that this brand of Euroscepticism was absent from the Brexit debate, for it embodied a coherent left-wing alternative to continuing EU membership. Now, with the prospect that a Labour-led government will rejoin the single market made more likely by Johnson’s blundering assault on the Northern Ireland protocol, a consensus forged 40 years ago is being given an anomalous lease of life.
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Brexit was an invitation to fashion a new political economy for this country, which the British political class declined. Red Tories and Blue Labour believed a market state could be replaced by one fostering intermediary institutions and a common life. But they were small minorities in their parties, and there was disagreement among them as to what a post-liberal agenda would entail. Then the Covid pandemic created what Tinline calls “a new choice of nightmares”: either the government imposed an authoritarian lockdown, or the NHS would be overwhelmed. Johnson fumbled his way through the pandemic. The question of the role the British state would serve in future was left unanswered.
There will have to be a larger crisis – perhaps triggered by the deepening impact of war in Ukraine, or major military conflict elsewhere in the world –before the neoliberal consensus can be left behind. Meanwhile British politics is stuck in a recurring nightmare. For Barbara Castle, the experience would not be unfamiliar.
The Death of Consensus: 100 Years of British Political Nightmares
Phil Tinline
C Hurst & Co, 472pp, £20
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This article appears in the 22 Jun 2022 issue of the New Statesman, Britain isn’t working