Underestimating Mr Benn

John Biffen

British politics have become increasingly unpredictable over the past generation. It now seems scarcely conceivable that the post-war Attlee administration did not lose a single by-election. Until the late 'fifties the modest and near-uniform electoral swings suggested some kind of political trench warfare with limited but decisive objectives. All that has changed. No seat now is safe in a by-election either. In Scotland no seat is safe in a general election. The Gallup opinion polls consistently record a 'don't know' tally of 20 to 25 per cent.

There is a profound discontent and unease with national institutions and established political parties. The intensity of that discontent has been masked. The Liberal Party, having forfeited its central role in British politics, nonetheless has remained a factor in the post-war era. Paradoxically, it became the beneficiary of the protest vote from the 'sixties onwards. The protestors had a host of reasons for their disillusionment, but they rarely coincided with the Liberal policies for British integration into the European Community and for greater acceptance of immigration.

Once there is an alternative vehicle for the protest vote we may perceive its harshness and desperation. It is still far too early to judge whether the National Front will rival the Liberals in the urban heartlands of England. The Front appears — momentarily — to have been checked in Leicester: but the fact that it outpaced the Liberals in thirty GLC seats is a timely reminder of the nature of the protest.

The air is thick with nostrums explaining our current malaise. Some of our difficulties are clearly evident. Inflation has proceeded at a terrifying rate since the early 'seventies, This has had a predictable and socially corrosive impact. The value of savings has plummeted. Trade unionists decry the profits of business; employers deplore the wage claims of labour; and politicians busily blame each other. It is a sickening babel of recrimination. Thus, whilst living standards are comparatively high, the random and unfair impact of inflation has left a sizeable minority who feel totally estranged from a political system that has permitted this state of affairs.

Secondly, the growth of government has necessitated heavy increases in direct taxation. These now bear acutely upon those earning well below the average wage. At the same time there are recipients of tax-free social security benefits who may also obtain occasional undeclared 'moonlight income'. This causes the most profound resentment. 'Why work?' is not an empty saloon bar rhetorical question. To a large number, perhaps a majority, Parliament seems unable to perform its basic tasks. It cannot provide monetary stability. It cannot devise a sensible tax system to match public spending. Its spending reveals a poor sense of priority. It is unwilling to implement an effective campaign against crime and uphold the rule of law.

The issues are crudely put. Even so they lie at the heart of a popular disenchantment with Westminster and traditional politics. This discontent neither knows nor cares about such weighty issues as a referendum, proportional representation, or a Bill of Rights.

I certainly do not disparage concern for constitutional innovation. It is sought by an influential minority, particularly from among the captains of industry and finance. It is not immediately clear, however, why constitutional change should produce greater political and economic stability. I have no innate hostility to referenda or electoral reform. There is, however, not a scrap of evidence to suggest that such changes would lead to the non-inflationary management of the economy. Businessmen who demand major constitutional changes often do so on the basis that we should approximate to forms of German government. It is then supposed there will be 'sympathy magic' which will produce our economic miracle. Yet the self-same people frequently reject the German concept of two-tier boards on the basis that British trade unions are irredeemable and quite unlike their German counterparts.

Of course our institutions are far from perfect. Even so it is political policies that have to be changed and not the constituion that has to be restructured. There will be those who will argue that we need a priority in constitutional change. They believe that a better economic performance will aFcompany the inevitable and consequential triumph of political 'moderates'. This siren argument must be ignored, It ranks with previous but discredited soft and comforting options that governments can spend or tax cut their way to economic growth, price stability, and full employment.

The Tory Party must, then, perform its task against the background of deep public unease and a widely-held conviction that the current generation of politicians and parties are unable to resolve the major outstanding social and economic issues. Such a task makes formidable demands on both political content and style.

I am profoundly sceptical of party manifestos and the commitments they usually imply. It is imperative, however, that the Tory Party should possess an inner con viction and a general cohesion about its policy objectives. That conviction has to be conveyed to the voting public. If that task cannot be fulfilled, Conservatism will be no more than a night-watchman, doomed to preside over the intervals of pause between the periods when its opponents make irreversible policy changes.

Let no one underestimate this danger. Tony Benn has now emerged as a major political figure in the Labour Party. He has become an irrational hate figure for many of his opponents in the worlds of politics and business. Yet, in my view, he is too substantial to merit this treatment. A Labour Party led by Tony Benn or Peter Shore could move towards the position of becoming the party of national planning allied to nationalism. This need not involve any substantial further nationalisation, It would involve the use of national government planning agreements with multi-national businesses, and the use of national import quotas and tariffs. The mood for protectionism is evident and could get stronger. There is, moreover, no reason to suppose that economic and social problems are any easier to resolve by supra-national rather than national government. Tony Benn is marking out a populist and radical alternative to our present economic and political arrangements. That alternative has 'national planning' as its touchstone. It is not, of itself, an extremist political remedy. It need involve no expropriation of assets; it builds upon the present close relationship between government and large-scale industry and it will capitalise on the present disillusionment with the Common Market. Those who take refuge in mere denunciations of these policies as some wild Marxist 'red-print' are reacting in a superficial and short-sighted way. Termite' socialism could become electorally popular and so requires a rather more measured and thoughtful response from the Tory Party. What, then, should be lire-eminent in the Tory message? What schemes can be proclaimed so that they capture public attention and contain the political dedication to make them effective? First, there must be a commitment to alter the balance of the mixed economy. Undoubtedly the co-existence of major public and private enterprises enables the failures of that economy to be attributed, according to taste, to the alleged failings of either private enterprise or the public corporations. There is no merit in a mindless Conservative berating of public enterprises. However, we now have a close identity between large-scale private enterprise and government and also a public sector whose pricing, incomes, and investment policies have been under close if not oppressive political control. The case for reform is now overwhelming. In February Sam Brittan wrote in the Financial Times: 'The point may yet come where Hungary or Poland may give a better approximation to a sensibly managed market economy than Britain or Italy'. That is a chilling comment.

Fortunately there are signs that it is poss ible to alter the balance in the economy. Conservatives will be heartened by the denationalisation of 000 m. of British Petroleum. Every effort should be made to secure a more direct participation in the financing of nationalised industries by the public other than in the captive role of taxpayer.

Furthermore public institutions should not become the easy bank of last recourse for business in decline. In the spirit of bipartisanship a Tory can underline the Labour government commitments on Department of Industry financial aid when It avowed 'An assessment of viability is a matter of facts, figures, and commercial Judgment, in which wider economic and social factors have no part to play.'

There is, then, scope for private finance to operate increasingly alongside government finance; for government finance to be withheld from situations of private industrial and commercial failure; and finally for the expansion of the private sector itself. This last-mentioned consideration Leads to the central question of taxation itself.

Taxation must be a major theme in the Tory message. The broad thrust of future Tory tax policy is already evident. Sir Geoffrey Howe has committed us to greater emphasis on indirect rather than direct taxation: to a reduction in the top limits of direct tax and to a reduction to the impact of capital taxation. Let no one assert that these changes will inevitably produce a growth in the private sector. That is too optimistic and too facile. Equally, however, let no one deny that these proposed changes will provide a happier environment for free enterprise and success.

Finally, there is the need for the Tory Party to establish a European policy that takes account of our national needs and the Maritime character of our trade and history. Mrs Thatcher has asserted: 'I believe we should continue to have a partnership of nation states each retaining the right to protect its vital interests, but developing more effectively than at present the habit of working together.

I I do not believe we shall get far by drawing up blueprints for the next generation. Our object in the political realities of today is to make a success of the partnership.' (Europa, January 1977). It is against these words we should test the British national interest in the prospective enlargement of the Community, and in its developing trade policies. A Common Market enlarged to include Greece, Spain, Portugal and, possibly, Turkey will be a transformed institution. Indeed it will provoke the question Whether the legal constraints of the Rome Treaty enable 'more effective working together. Secondly, do our 'vital national interests' lie in a policy of EEC protection or EEC free trade? The Conservative Party has an over-riding need to proclaim what are its national objectives within the EEC and by what institutions it intends to secure them. In this context there are two dangers to avoid: the first is the possible emergence of inconsistent economic policies as applied respectively on the national and European stage, A domestic policy of 'setting the peo ple free' cannot truly co-exist within a nar rowly protectionist continental system. We cannot be economic liberals at Westminster and captive `dirigistes' in Brussels, in the mistaken belief that future expanded public spending by the Community will be financed by the Germans. Secondly, the Conservative Party must not become identified in the public mind with foreign bureaucratic rule, out of a foolish fear of appearing insufficiently 'European'.

A vigorous and successful Toryism can only be built out of a fruitful inter-marriage of liberal economics with an outward-looking patriotism. There is an obvious and appealing link between self-reliance at home and national confidence abroad, and its articulation and embodiment should be the prime concern of the next Conservative government.

I turn now to the question of style. The case for liberal economics in a national context needs the most persistent advocacy. It runs counter to so much of the received widsorn of the past generation. During that period it has been constantly argued that almost every problem was susceptible to a political or public spending remedy. Secondly, it was generally supposed that Britain desperately needed the substance of a multi-national association as the substitute for a vanished Empire. We now need to preach the virtues of rewarded individual success and the merits of a measured sense of national defiance and assertion.

The language and style of such a political message is all-important. It is not an appeal to unbridled self-seeking and an evocation of an empty jingoism. It is an appeal to a people who have observed the gap between political promise and subsequent performance. It is, therefore, vital not to raise expectations that cannot be fulfilled. A policy designed to cut back public spending, effectively reduce taxation and accommodate the consequential economic upheavals is daunting. It has a long political lead time. It needs two parliaments. It is significant that the leading British monetarist economist, Alan Walters, has advocated a seven-year Parliament. The fearful prospect is for a general election to intervene upon a half-completed strategy. Half-success is all too easily equated with total failure. The rhetoric of politics, therefore, should be modest in the extreme.

Secondly, there must be a disposition to incur the minimum of institutional dislocation. In particular this precept applies to the area of so-called 'incomes policy'. There have been a succession of aborted or abortive institutions that have sought to assist in the government regulation of pay. Future governments will doubtless wish to proclaim the expected consequences of their public spending, taxing and borrowing policies. There is absolutely no reason why the institutions that attend this dimension of government should not be common to Labour and Tory alike.

Thirdly, the emphasis on the individual and the nation as opposed to large-scale government and the continental superstate does have a special appeal to the selfemployed and small businesses. It is essential that this appeal should not be in narrow `poujadist' terms. Neither should it be a starry-eyed and idealistic level — worthy of William Morris. There is, however, growing evidence to suggest that the growth of small businesses provides the greatest hope for countering endemic unemployment.

The issue, however, has wider implications. The debate on energy will ultimately revolve around the decision whether our national ingenuities are to be devoted to rendering nuclear power environmentally acceptable, or whether they are to be devoted to harnessing the renewable energy sources on a scale hitherto thought unattainable. No one supposes this is a crude argument between size and smallness. Even so it would be absurd to ignore the dominance the nuclear decision would give to technical (and political) centralisation of power supplies. Many sceptics of nuclear power are to be found amongst libertarian groups not particularly sympathetic to the Conservative Party. This should not dismay any Tory. The developing debate that identifies Toryism with a restricted view of government will, or could, provide it with unfamiliar allies. That is a consequence of the extreme volatility of contemporary politics.

Liberal economics in a national context is not a reversion to a Palmerstonian age of free trade and gunboats. It is an attempt to answer the anxieties of countless thousands who feel that government is too remote, too ineffectual, and too costly. The foreboding is matched by a bewilderment as politicians have sought to dismantle the power — if not the trappings — of a British nation state. Those anxieties must be measured and matched by the present political parties. The task requires clear policies and objectives. Above all it calls for an emollient style and modest but sustainable promises whilst we inch back from the abyss of unfulfilled expectations.

This is the introduction to a collection of John Biffen's speeches, Political Office or Political Power, to be published next week by the Centre for Policy Studies.