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Bevan  re-visited

UK trade unionists Victims of judicial prejudice

I'll let you into a secret.  Twentieth century trade union history, indeed the entire emergence of the political Left in the UK, was profoundly influenced by a legal issue which was peculiar to the UK, and did not arise on the Continent at all.  And the issue still lives on, in the arcane rigidities which inhibit trade union action in the UK.

It all started with the creation of three anti-union legal doctrines, as a matter of common law, by the High Court judges of the late 19th century.  Parliament did not get involved.  The Judges were left to develop three vicious anti-union doctrines which had the effect, by 1900, of crippling trade union action.  It was these obstacles that forced the TUC, in 1899, to embark on the attempt to secure political representation, in order to secure changes in the law, to protect themselves against the Judges.   And it was that initiative which gave birth to the Labour Party, in the 1906/1918 period.

These were the offending doctrines. 

• First, the proposition that union officials could be sued personally for damages (as agents of the strikers) by employers who had suffered loss as the result of a strike.  This was the subject of the Osborne Judgement (1902, as I remember).  It made the organisation of any strike action an extremely hazardous personal venture for TU leaders and officials.

• Second, the doctrine that it was a civil wrong (a tort, in legal jargon) for anyone to "induce" a breach of contract between other persons - this also exposed TU leaders to grave personal risk, if they exhorted workers to breach their contracts with their employers and come out on strike.  This was a bizarre piece of law-making by prejudiced High Court judges, and has to this day no counterpart in continental European law.

• Third, the doctrine of "civil conspiracy".  Criminal conspiracy was of course a common-law crime developed to deal with Guy Fawkes - after all, he did not succeed in actually igniting the explosive, but he and his friends did "conspire" to cause death, and were punished for that.  Faced with the growing strength of strike action in the 1880s and 1890s, the UK Judges drew on the same reasoning, and held that it was a civil wrong (tort, again) to "conspire with others" to cause any harm to any third-party - and of course, the planning of any strike was then said to offend against that principle.

These were all distinctive, and distinctively vicious, anti-union doctrines - doctrines which never saw the light of day on the Continent, or in Continental civil law.  That is why, with the Trade Disputes Act 1906 trade unions had to be given special statutory protection (where acting in furtherance of a trade dispute).  No such special protective legislation has ever been necessary in continental systems, where the right to strike has been regarded as self-evident.  And this adverse configuration of the law has dominated English labour law ever since.  We live in a strange and uniquely distorted legal environment, still poisoned by the actions of the 19th Century High Court.  This legal protection has now itself been curtailed (so that sympathy strikes are for example no longer protected) - and TU leaders are protected only if a strike has been authorised by ballot, within a strictly-regulated framework.  The Victorian poison lingers...

 I suspect that this legacy still has consequences of which we are barely conscious - have you come across its dismal trail, in practice?
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My government continues to wrestle with the problem of caring for the aged.  The inadequacy of residential care continues to cause "bed blocking" in the NHS, severely aggravating its capacity problems.  Health Minister Alan Milburn has announced the new idea of paying hefty weekly cash allowances to encourage more people to stay in their own homes, with special equipment and caring assistance as necessary.  It will no doubt alleviate the situation, although the potential for fraud and deception must also be considerable.

But there is missing any coherent framework of overall policy - and without that, these ad hoc measures run the risk of breaking down. I suggest that the whole policy sector needs to thought through anew. 

This is my suggested Labour position.

First, we should recognise that, in this sector, the anticipatory dimension is peculiarly important, politically.  The actual provision must of course be satisfactory, that is self-evident.  But for every old person who eventually does become dependent upon such care, there are three or four who worry about needing it - but never actually do.  That anticipatory anxiety is itself corrosive and destructive, and should be addressed by Government.  In designing any new system of provision, it is vital that everyone should be enabled to predict what their position would be if the need transpired. 

Second, the Government should act quickly to remove the basic uncertainty surrounding the sale of the elderly person's home to pay for geriatric care provision.  Local authorities vary, in their requirements, and diversity only goes to deepen the overall uncertainty.  I say that the Government should adopt a clear national position, without permitting local variation: as in the United States, no elderly person needing any public service should be forced to sell the family home to fund such service - whatever the circumstances.  The consequential reduction in anxiety would be enormous.

• The market sector would consist of privately-owned care-homes which would operate, relying on the standard flat-rate PRB alone, plus whatever market supplement they could command; the PRB might well be operated by some kind of voucher system;
• The managed sector would consist of both existing LA public homes and private care-homes transferred from private proprietors: transferred homes could be managed by the former proprietor (where that service had been satisfactory); contracts of management employment would include a turnover related bonus payment, in addition to core salary.  Part of the transfer agreement would be a clause entitling the former proprietor to buy back the care-home, if he/she considered that it could again be operated on a market basis.  Proprietors facing difficulty in the open market-place should be encouraged to come into a favourable managed public sector system which would give them the chance to "take their care-home private again", if market conditions improved.

Roger Warren Evans  
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Can you think of other examples? 
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364  25 July 2002

Do you know how mutual understanding will be best re-established?  I feel out of my depth on this one, and would welcome your ideas.
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366    29 July 2002  

Blair's second Press Conference was well received by Polly Toynbee, writing in the Guardian.  She brought two distinctive perceptions of her own - one right and the other, I believe,

quite wrong.

She is right about this -

• "There is admiration for Blair's Teflon toughness, but also still suspicion of a man without ideology.  His private Christian values may be enough of a spiritual guide for him, but a secular country needs political idealism and sense of direction".

That is very perceptive, and concise - both about Blair and about the rest of us.  My own search is precisely for a new socialist perspective which makes sense of it all, just like that ol' time religion.  Labour's future political momentum, I believe, will depend on the Party's success in finding and articulating that rationale. 

But Polly T. goes on to predict that Blair will choose to fight a Euro Referendum, and clothe himself in Europeanism, identifying that as his alternative secular belief system.   And that is where she is, I think, wrong.  She believes that there will be a polarised choice between warm-beer "Little Englandism" and European social democracy.  Blair, she argues, will choose European social democracy.

I disagree.   For "old" European social democracy is itself a busted flush, and Blair knows it.  The grim truth is that the European Wohlfahrtstaat - also called Rheinland socialism - is sclerotic, inflexible and unenterprising.  Blair is right to reject it, and to push his fellow leaders in a different direction.  Blair is right to sense that there is a third way between the American market model and the European model.   He has not yet defined that "UK model" coherently, but I am convinced that it can be defined.  It is a socialist market model.

It is first and foremost a market model.  Real lessons were learnt during the 1980s and 1990s, and they should not be thrown out with the bathwater.  Primacy should be accorded to open trading, constrained only by the imperatives of public policy.  Priority should be given at all times to the encouragement of new business, new trading intiatives, to the cultivation of perpetual innovation through trading initiatives of all kinds.  The theme should be perpetual renewal, through serial innovation.  No top-down form of dirigisme can be expected to secure the wellbeing of 6,000 million people, set to rise to 9,000 million.   For the world as a whole, it is only the flexibility and responsiveness of market trading systems that offer material salvation.  Consumer requirements are constantly changing, and traders must at all times be free to respond to those changes, as quickly as possible. The future wellbeing of mankind depends on the cultivation of perpetual innovation.

But I see the UK model, quite clearly, as a socialist market model.  That means that the anxieties of ordinary people must be constantly countered by the intervention of the State in the trading process, countering its many vagaries and injustices, its many malfunctions and failures.  Socialism, for Aneurin Bevan, meant countering fear: his autobiography was entitled In Place of Fear, and I have found constant inspiration in thinking through that theme.  The auld socialist objectives have to be re-thought - from first principles - and given new expression suited to the trading realities of the modern world, with its rapidly rising population and its rapidly growing economy.

Market intervention to achieve socialist ends is a difficult and challenging process.  Yet it is in this territory that the UK way is to be defined.  So I think - I hope - that Polly Toynbee is wrong, and that the choice does not simply lie between American frontier capitalism, and the "old" social market state of 20th century Europe.

My socialist market state would be a very different world, focusing at each point upon the subjective perceptions of its citizens, and countering their anxieties, their fears.  State intervention would at every point be differential in character, avoiding rigidities, and according to all citizens a fair proportion of social goods.  Market trading can deliver innovation and growth, both in the trading and social sectors.  But only the State can deliver, for the poor and those without substantial private property, a reasonable sense of security, a sense of civic order, and a reasonable confidence in the justice of the social framework.

Our task is to re-design our socialism, while retaining the dynamism of the market trading system.   And neither America nor Europe has solved that problem.  There is indeed a third way.

Are you with me?  Or are you with the Woolwich?
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367    3 August 2002

My dear father was a great fan of John Maynard Keynes.  By the time of the Great 1929 Crash, and the publication in the same year of the Liberal Yellow Book ("Unemployment: What Can Be Done?") my father was already 41, and well set in his political ways, as a Lloyd George Welsh Liberal.  But for him, the Thirties became a frantic personal search for ways of re-starting the world's economic engines.  His own speciality (as a banker by training, and a lawyer by profession) was negative interest: he wrote papers on the need to charge savers for the privilege of being allowed to keep money in bank-account (5% per annum, he advocated) - and one Swiss Canton in fact introduced such a scheme.  The idea was to make saving so unattractive that consumers went out and spent their money - which, everyone agreed, was the one thing needed to re-boot the economy...

 Keynes never understood (any more than we now really understand) precisely how and why a modern economy works at all.  It's like a Buckminster Fuller dome: when all the pieces are in place, and interlocking in their operation, it seems very strong, and works well - but how does it get into that position?  Even though I have a Cambridge First in the principles of Economics, I can offer you no answer.  The awesome failure of the Russian economy since 1990 is sufficient proof (if proof were needed) that we have no real idea how our own economies work - we're all still guessing...

But in that guessing process, Keynes did us all a grave disservice.  When his analytical powers failed him and he had himself to resort to guessing,  he turned for his explanation to the "animal spirits" of investors and company executives.  "If the animal spirits are dimmed, and the spontaneous optimism falters,...enterprise will fade and die".  That's what he wrote. 

How absurd!  What arbitrary, a priori reasoning! It's like the sociologist who fails to explain human behaviour, attributing it grandiloquently to national character, or cultural traits.  Keynes' heroes, his primary progenitors of success, became the entrepreneurs, the captains of industry and commerce.  Without a shred of evidence, or argument.

We have been suffering from that misperception ever since.  Margaret Thatcher suffered from it.  Tony Blair suffers from it.  And many generations of so-called "business leaders" have benefited it -  materially, socially and politically.

The problem is that it waswrong.  Businessmen are followers, not leaders.  It is not the entrepreneur who leads, it is the collective movement of consumer behaviour, consumer confidence.  That is the primal phenomenon which we should all be studying, through all our waking hours - that is the whole focus of my own thesis Multiple Differential Uncertainty.  Investors and entrepreneurs will pile in soon enough, as secondary players, once they sense that domestic consumption is on the move.  And it is true that some individuals seem to possess greater skill than others, in the analysis of consumer behaviour - that is a great asset, in business.  And consumer confidence is affected by a thousand factors, many of them well beyond the economic realm. 

And Government intervention is subject to the same iron rule: even huge amounts of public expenditure will be insufficient to move the economy unless the intervention as a whole operates to allay consumers' fears, their anxieties about the future.  What matters is not the input itself, but the effect of that input upon the perceptions of the domestic consumer.  that is where economics and democratic politics converge.  that is what explains the close confluence of interest, between democratric politicans and the trading community. That is why Keynesian intervention has been so dramatically unsuccessful in Japan.

• While you have a moment, over August, I ask you to ponder these things.

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