The Foundations of the British Conservative Party: Essays on Conservatism from Lord Salisbury to David Cameron 9781441106148, 9781501300769, 9781441181411

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The Foundations of the British Conservative Party

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The Foundations of the British Conservative Party Essays on Conservatism from Lord Salisbury to David Cameron Edited by Bradley W. Hart and Richard Carr

N E W YOR K • LON DON • N E W DE L H I • SY DN EY

Bloomsbury Academic An imprint of Bloomsbury Publishing Plc

1385 Broadway New York NY 10018 USA

50 Bedford Square London WC1B 3DP UK

www.bloomsbury.com First published 2013 © Bradley W. Hart, Richard Carr and Contributors, 2013 All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or any information storage or retrieval system, without prior permission in writing from the publishers. No responsibility for loss caused to any individual or organization acting on or refraining from action as a result of the material in this publication can be accepted by Bloomsbury Academic or the author. Library of Congress Cataloging-in-Publication Data The foundations of the British Conservative party: essays on Conservatism from Lord Salisbury to David Cameron/edited by Bradley W. Hart and Richard Carr. pages cm Includes bibliographical references and index. ISBN 978-1-4411-0614-8 (hardcover: alk. paper) 1.  Conservative Party (Great Britain)–History. 2.  Conservatism–Great Britain. 3.  Great Britain– Politics and government. I. Hart, Bradley W. II. Carr, Richard, 1985– JN1129.C7F68 2013 324.24104–dc23 2013006009



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Dedicated to the staff of the Churchill Archives Centre, Cambridge, without whom this work would not have been possible.

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Contents Acknowledgements Foreword  The Rt Hon The Lord Carrington KG GCMG CH MC PC DL Contributor Information

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Introduction  Bradley W. Hart

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Section 1  The Conservative Ideal

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The Principles of British Conservatism from Balfour to Heath, c.1910–75  Stuart Ball

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The Conservative Dialectic of Margaret Thatcher’s First Term  Kieron O’Hara

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Section 2  The Conservatives and the Union

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Tory Rebels and Tory Democracy: The Ulster Crisis, 1900–14  Robert Saunders

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The Conservative Party and the Irish Question, c.1885–2010  Alan Macleod

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Section 3  Looking Beyond Westminster

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Machinations of the Centre-Right and British Engagement with the Pan-European Ideal, 1929–48  Richard Carr and Bradley W. Hart

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The Conservatives and Local Government: Reform, Localism and the Big Society since 1888  Steven Howell

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Section 4  Conservatism and Party Politics

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Coalition Blues: The Conservatives, the Liberals and ConservativeLiberal Coalitions in Britain since 1895  Chris Wrigley

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Contents

  8 How to Put ‘the People First’: Conservative Conceptions of Reform Before and After the Second World War  Richard Carr

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Section 5  The Future of Conservatism

  9 The Limits of Power: Conservative Experience and Opportunity  The Rt Hon Sir John Major KG CH ACIB

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10 Neo-Orthodoxy: Conservative Economic Policy in the Twenty-First Century  Irwin Stelzer

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Conclusion – Where Next?  Bradley W. Hart and Richard Carr

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Index

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Acknowledgements The editors would like to thank all those who contributed to the conference from which this volume has emerged. Conservatism: Today and Yesterday was held on 26 November 2010 at Churchill College, Cambridge, and the work of college staff both before and on the day itself helped make for a stimulating and successful event. As two former students of the college, we should of course thank Churchill’s Master Sir David Wallace for his role in making the conference such a success. The Winston Churchill Memorial Trust, Churchill College, and the George Trevelyan History Faculty Conference Grants at the University of Cambridge have all provided funding at various stages of either the initial conference or research and editing process for the book itself, and we are grateful for the support these organizations have provided. Our editors at Continuum and Bloomsbury have been extremely helpful throughout the process of the production, and we would like to thank Marie Claire-Antoine, Kaitlin Fontana, and Ally Jane Grossan in particular for helping see this volume through to fruition. Equally, our contributors have produced a variety of chapters on several topics – and in some cases have written two papers, one for the initial conference, and another for this volume. Our many thanks to all of them. We are grateful to Sir John Major and Dr Irwin Stelzer for permission to reproduce their conference papers in full. Lord Carrington very helpfully turned round his generous foreword in extremely quick time. Lastly, as the dedication at the front of this book makes clear, Allen Packwood and his team at the Churchill Archives Centre have assisted in numerous ways in the production of this work – through the initial conference event, the archiving and sourcing some of the documents referenced throughout this volume, and various forms of kindness shown to both editors over several years. Our grateful thanks go to them.

Foreword The Rt Hon The Lord Carrington KG GCMG CH MC PC DL

The subject of this work is of importance to all interested in British politics – whether supportive of the Conservatives or not. The Conservative Party has held office for more than any other in the modern era, and has included within its midst many of the major political actors of our times. In terms of ideology, a party which has been led in the last century by Stanley Baldwin, Harold Macmillan and David Cameron on the one hand, and Margaret Thatcher and Winston Churchill on the other, is certainly ripe for stimulating discussion. In many ways the term ‘Conservative’ does not always accurately capture the contribution the party has made in our public life. The party has been adaptive in opposition and reforming in office. It has played a dynamic role in the waging of two world wars, and it has sought to take on vested interests in the overall national interest. Naturally, a party which has been in office for such long periods will attract its fair share of criticism on occasion. This volume highlights areas where Conservative politicians and the party itself have not performed as some argue they might. Some will agree with the charges here, others will not. In any case, turning the mirror on oneself has always been a Conservative trait. Reform comes through learning the lessons of the past. I welcome, then, this volume which unites historians, political scientists and former Conservative politicians. Conservatism has shown a willingness to bend when circumstance dictates, and move with the times. This book, in helping stimulate discussion about where the party has been, enriches our understanding of where the party may go next. I commend it to broad attention.

Contributor Information Professor Stuart Ball is Professor in Modern British History at the University of Leicester. He has published extensively on the history of the Conservative Party in the twentieth century, including Baldwin and the Conservative Party (Yale University Press, 1988), The Conservative Party and British Politics 1902–1951 (Longman, 1995), Winston Churchill (British Library, 2003), and Dole Queues and Demons: British Election Posters from the Conservative Party Archive (Bodleian Library, 2011). He has edited the political diaries of Sir Cuthbert Headlam (two volumes, 1992 and 1999), and, with Anthony Seldon, Conservative Century: The Conservative Party since 1900 (Oxford University Press, 1994) and Recovering Power: The Conservatives in Opposition since 1867 (Palgrave Macmillan, 2005). His most recent book is Portrait of a Party: The Conservative Party in Britain 1918–1945 (Oxford University Press, 2013). Dr Richard Carr is a Research Fellow at Anglia Ruskin University, and has lectured at the University of East Anglia and served as a By-Fellow at Churchill College, Cambridge. He has published widely on twentieth-century British politics, including the monograph Veteran MPs and Conservative Politics in the Aftermath of the Great War (Farnham, 2013), and journal articles on the Tories and appeasement (Twentieth Century British History, 2011), electioneering in the 1920s (Historical Research, 2012) and eugenic interpretations throughout the interwar period (First World War Studies, 2012). He is currently researching a biography of the Wilson era Labour Minister Alice Bacon with Rachel Reeves MP. Dr Bradley Hart is a lecturer at California State University, Fresno. In  2011, he completed his PhD in history at Churchill College, Cambridge and has published extensively on the international eugenics movement, the history of anthropology and the relationship between science and public policy in the early twentieth century. He is currently working on a book derived from his doctoral thesis examining the relationship between the British, German and American eugenics movements in the interwar years.

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Contributor Information

Steven Howell is a Research Fellow at the localism and local government think tank Localis, where he writes on a variety of local government policy areas. His recent work includes reports focusing on the commissioning relationship between local government and external partners ‘Catalyst Councils’, and regeneration ‘Grow Your Own Way’, while also contributing research to publications on the mismatch between skills and employment prospects, and different forms of local public sector leadership. Prior to this, he worked as a researcher in local government and read History at King’s College London. His contribution is written in a personal capacity. Dr Alan Macleod is a Research Fellow at the University of Leeds. His research interests are in British political, diplomatic and security history. In  2012, he completed his PhD at the University of Glasgow on the international dimension of the Troubles in Northern Ireland during the early 1970s. He is currently working on a study of the British intelligence services in the mid-twentieth century. Sir John Major KG CH PC ACIB served as Conservative Party leader and Prime Minister of the United Kingdom from 1990 to 1997. Prior to this, he held the posts of Foreign Secretary and Chancellor of the Exchequer under Margaret Thatcher. He was elected to Lambeth Council in 1968 and, in 1979, as MP for Huntingdon. He retired from the House of Commons in 2001. His victory in the 1992 General Election not only saw the largest number of votes for any British political party before or since, but also remains the last time – as of 2013 – that the Conservative Party achieved an outright majority in the House of Commons. He has recently published the historical work My Old Man: A Personal History of the Music Hall (London, 2012) to widely positive reviews. Dr Kieron O’Hara is a Senior Research Fellow in Electronics and Computer Science, where he writes on the philosophy and politics of technology, particularly trust, privacy and transparency. He is also a commentator on conservatism and the British Conservative Party, a Research Fellow for the Centre for Policy Studies, and the author of ‘After Blair: Conservatism Beyond Thatcher’ (2005), ‘The Referendum Roundabout’ (2006), ‘Joseph Conrad Today’ (2007), ‘Democratising Conservative Leadership Selection: From Grey Suits to Grass Roots’ (2008, with Andrew Denham) and ‘Conservatism’ (2011). He is the author of a report on transparency and privacy, ‘Transparent Government, Not Transparent Citizens’, for the Cabinet Office (2011), and chairs the Transparency

Contributor Information

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Sector Panel on Crime and Criminal Justice at the Home Office and the Ministry of Justice. His latest book is an introduction to the work of Aldous Huxley. Dr Robert Saunders is a lecturer in History and Politics at the University of Oxford. He is the author of Democracy and the Vote in British Politics, 1848–67: The Making of the Second Reform Act (Farnham, 2011) and co-editor with Ben Jackson of Making Thatcher’s Britain (Cambridge, 2012). He has published articles on Chartism, the relationship between Britain and America and the history of democratic thought, as well as writing political commentary in a variety of blogs and journals. He is currently researching the intellectual history of Thatcherism and the impact of the Cold War on British politics and society. Dr Irwin Stelzer is a Senior Fellow and Director of Hudson Institute’s economic policy studies group. Prior to joining Hudson Institute in  1998, Stelzer was Resident Scholar and Director of regulatory policy studies at the American Enterprise Institute. He is an US economic columnist who often contributes to The Guardian, Daily Telegraph, the New Statesman, among others. His academic career includes teaching appointments at Cornell University, the University of Connecticut and New York University. He is a Visiting Fellow at Nuffield College, Oxford. He has advised several Prime Ministers in both Conservative and Labour administrations. Professor Chris Wrigley is Emeritus Professor of Modern British History, Nottingham University. He previously taught at Queen’s University of Belfast and Loughborough University. His books include David Lloyd George and the British Labour Movement (1976), Lloyd George and the Challenge of Labour (1990), Arthur Henderson (1990), Lloyd George (1992), British Trade Unions Since 1933 (2002), Winston Churchill (2006) and AJP Taylor: Radical Historian of Europe (2006). Among the books he has edited are A History of British Industrial Relations, 3 volumes (1982–96), William Barnes: the Dorset Poet (1984), Challenges of Labour: Central and Western Europe, 1917–20 (1993), British Trade Unionism 1945–95 (1997), The First World War and the International Economy (2000), Churchill: A Biographical Dictionary (2002), A Companion to Early Twentieth Century British History (2003) and (jointly) The Second Labour Government, 1929–31 (2011). He was president of the Historical Association, from 1996 to 1999. He was awarded an honourary doctorate by the University of East Anglia in 1998.

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Introduction Bradley W. Hart

On 11 May 2010, Conservative Party leader David Cameron moved into 10 Downing Street, officially ending more than a decade of Labour government. This victory had not come easily for Cameron or his party: despite spending nearly 5  years attempting to change the Party’s image and improve its poll numbers after Cameron became leader, and with Labour leader Gordon Brown viewed – rightly or wrongly – as unlikeable, the Conservatives failed to achieve an outright victory. Winning some 306 seats at the polls, the Conservatives were short of the minimum (326) number of seats required to form a stable government on their own. These they quickly gained by concluding a coalition agreement with the Liberal Democrats that included the appointment of leader Nick Clegg as Deputy Prime Minister, with Vince Cable, Chris Huhne and others taking their seats at the Cabinet table. With his majority thus secured, Cameron became the head of Britain’s first full-blown coalition government since World War II and the youngest Prime Minister since Lord Liverpool nearly two centuries before.1 In one sense then, he fulfilled his own claim to be the ‘heir to Blair’ by breaking the Labour Prime Minister’s own record of a youthful rise to the top job in 1997. Throughout the 2010 General Election campaign, Cameron and Conservative strategists went to great lengths to challenge the electorate’s perceptions of the Party and its manifesto. The pro-privatization and free market rhetoric of the Margaret Thatcher era was played down (if consistently still highlighted by their Labour opponents) and in its place was the assertion that the Conservatives were ‘the party of the NHS [National Health Service]’ and advocates of the ‘Big Society’.2 This latter notion, which was largely influenced by the writings 1

2

A. Hough, ‘David Cameron becomes youngest Prime Minister in almost 200 years’, The Telegraph, 11 May 2010 (http://www.telegraph.co.uk/news/politics/david-cameron/7712545/David-Cameronbecomes-youngest-Prime-Minister-in-almost-200-years.html). R. Winnett, ‘David Cameron: Tories are the party of the NHS’, 4 January 2010 (http://www.telegraph. co.uk/news/election-2010/6932043/David-Cameron-Tories-are-the-party-of-the-NHS.html).

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of Conservative ‘philosopher king’ Phillip Blond, called on Westminster to empower local government and, ultimately, individuals (their manifesto was entitled, rather like some formal RSVP, ‘an invitation to join the government of Britain’) in a wide variety of areas. This broad localization programme included giving councils greater borrowing powers (such as Tax Increment Financing, long used in the United States) and greater retention of their business rates, setting up so-called ‘free schools’ along the Swedish model which would be free from local authority control, and a number of other policies which, in theory, were predicated on subsidiarity. By returning power to the local level, Cameron argued, individuals would be empowered to assert control over their own communities through volunteerism and becoming closer to the complex, and sometimes difficult, decision-making process. As a result, much of the legislation passed by Cameron’s government, including the somewhat aborted and largely unpopular attempts to reform aspects of the NHS, was at least initially couched in the language of localism and ‘cutting the red tape’ for innovators and for those seeking to help their communities.3 Cynics and political foes argued that this rhetoric merely provided a pre-text for extensive public-sector cuts by encouraging charities and other groups to take on responsibilities previously managed by government, but Cameron denied having an agenda beyond ‘the biggest, most dramatic redistribution of power from elites in Whitehall to the man and woman on the street’.4 This volume hopes to cut through such short-term debates and place them in their historical context. The Conservative Party, after all, is the oldest and most successful of Britain’s political parties, and has faced off against numerous rival parties over the centuries that have sometimes ceased to exist entirely, as in the case of the Whigs. Since the early years of the twentieth century, the party has provided an alternative to both Liberal and Labour visions of how the nation should develop, and how power should be concentrated. As Stuart Ball notes in his chapter, much of this role has revolved around providing a ‘pragmatic’ alternative to the far-reaching ‘ideological’ plans of its rivals, and indeed much of the 2010 General Election campaign focused on both the alleged incompetence of Gordon Brown’s Labour government, and discrediting 3

4

For an example, see K. Ahmed, ‘David Cameron’s radical plan to reform jobs red tape’, The Telegraph, 19 May 2012 (http://www.telegraph.co.uk/news/politics/9277508/David-Camerons-radical-planto-reform-jobs-red-tape.html). N. Watt, ‘Cameron promises power for the man and woman on the street’, The Guardian, 19 July 2010 (http://www.guardian.co.uk/politics/2010/jul/19/david-cameron-big-society-cuts).

Introduction

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(ironically given developments in the week that followed the election) the rigourously costed proposals in the Liberal Democrat manifesto. Cameron’s claims to be eliminating bureaucracy and paving the way for a more empowered citizenry, thus, fit into a longer historical tradition of Conservatives presenting their party’s ideas as a remedy to the grandiose and complex schemes of its more progressive opponents, whether the Liberals prior to the early 1920s, or Labour thereafter. By examining these historical precursors, therefore, we can learn a great deal about the way these ideas might well be viewed by the electorate and, indeed, whether they are likely to be successful politically or otherwise. The chapters included in this volume, thus, hope to shed important new light on where British conservatism has been and where it may be going over the next few years.

Origins of modern conservatism British conservatism has understandably been the subject of much past schol­ arship. Many, if not most, scholars have placed the intellectual roots of modern conservative politics in the writings of Edmund Burke, whose Reflections on the Revolution in France (1790) appeared to present a succinct outline of conservative arguments against radical and revolutionary change. Despite being a Whig rather than a Tory himself, Burke argued against the French Revolution’s radicalism in strongly reactionary terms. As general policy, Burke argued, existing traditions and ‘establishments’ ought not to be abandoned or significantly changed without a significant and pressing justification. ‘The errors and defects of old establishments are visible and palpable. It calls for little ability to point them out; and where absolute power is given, it requires but a word wholly to abolish the vice and the establishment together,’ Burke wrote.5 With existing establishments thus destroyed, ‘to make every thing the reverse of what they [politicians] have seen is quite as easy as to destroy. No difficulties occur in what has never been tried.’6 Instead, Burke argued, a more rational path would be to ‘at once to preserve and to reform’ the ‘useful parts of an old establishment’ through careful consideration, despite the relatively slow rate of progress this method might entail. Indeed, for Burke, this slow pace of progress 5 6

E. Burke, Reflections on the French Revolution, Ed. L. G. Mitchell (1993), 168. Ibid., 169.

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was desirable in itself. ‘If circumspection and caution are a part of wisdom, when we work only upon inanimate matter, surely they become part of duty too, when the subject of our demolition is not brick and timber, but sentient beings, by the sudden alteration of whose state, condition, and habits, multitudes may be rendered miserable.’7 Thus, for Burke, progress should be slow and proceed with appropriate reverence for existing institutions and the ideas that underpin them. Government should not seek to reinvent the wheel, if the existing wheel empirically seems to work rather well. The influence of Burke’s view of politics, particularly regarding the relation­ ship between the past and the present, is still visible today. Indeed, throughout the modern period, British conservatism has essentially presented itself to a lesser or greater extent as a bulwark against radicalism. In a remarkable 1954 article, American political scientist Leon D. Epstein concluded that Conservatism in the nineteenth and twentieth centuries largely focused on a combination of Burkean anti-radicalism and more vaguely defined precapitalist economic interests, leading its proponents to successively oppose the Whigs, Liberals and, most significantly after the events of 1922, which Chris Wrigley’s chapter in this volume touches on, Labour.8 At the heart of these views, Epstein found the relationship between history and the present day to be vital to the conservative mindset. ‘Essentially it appears that the intellectual ground being defended is the British tradition of balance and moderation which the Party considers its own faith. Conservatives not only believe that there is much in the past worth preserving, but that they, because of their attachments to the past, can best decide what ought to be saved,’ Epstein wrote.9 Political success for the Conservative Party, Epstein concluded, would, thus, come from an expansion of a middle class that could be convinced to vote Tory because of its own aspirations towards property ownership and individual economic improvement.10 Indeed, this view of Conservatism as essentially a counterpoint or alternative to the statist policies of the Labour Party has perhaps been the party’s most defining characteristic since World War I. Throughout the 1920s and 1930s, Conservative Prime Minister Stanley Baldwin attempted to position his party   7   8

  9 10

Ibid., 169. L. Epstein, ‘Politics of British Conservatism’, The American Political Science Review, Vol. 48, No. 1 (March 1954), 27–48. Ibid., 32. Ibid., 48.

Introduction

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as a predictable, Burkean alternative to the ‘radical’ platform advocated by Labour.11 As Philip Williamson has observed, as Baldwin’s career veered through the tumultuous terrain of early twentieth-century politics, he helped build the framework that subsequent Tory leaders would use to confront Labour in later years.12 Despite taking serious damage to his reputation during World War II and after, Baldwin’s influence on twentieth-century politics and Conservatism is undergoing significant reconsideration. That Anthony Eden and Harold Macmillan – both in many ways the political heirs to Baldwin – would go on to lead the Conservative Party after 1945 meant there was a degree of continuation in Conservative thought that is often somewhat downplayed. The nature of the post-war consensus is probed in this volume with a chapter by Richard Carr. It is Winston Churchill, of course, who is perhaps most closely associated in the public mind with pre-Thatcher conservatism. Taking over from Neville Chamberlain during one of Britain’s darkest hours in May 1940, Churchill’s leadership undoubtedly helped make Britain’s survival and eventual victory in World War II possible. Churchill’s coalition government included all the major parties in an effort to ensure national unity, and an electoral truce during the war prevented partisan campaigning when seats became open, though independent candidates often ran against the major parties and, on some occasions, were victorious in by-elections.13 Despite predictions of a Conservative victory in a repeat of the ‘Khaki Elections’ of 1900 and 1918, Churchill was swept out of power in  1945 by Attlee’s Labour Party promising a New Jerusalem of state ownership, a National Health Service, and no repetition of the mass, lengthy unemployment seen in the interwar years. As John Charmley has argued, the inclusion of Labour figures in the coalition government for much of the war may well have lessened the appeal of Baldwin-esque arguments about the radical dangers posed by socialist policies and politicians.14 Churchill’s ill-conceived remark in an election speech that Labour would need to establish a ‘Gestapo’ to insure the success of its political programme likely did not help either, though such themes regarding freedom from governmental control would return to Tory discourse in the 1950s and, most famously, in the Thatcher era from 1975 onwards.15 11 12 13 14 15

See P. Williamson, Stanley Baldwin (1999). Ibid., 8–11. J. Charmley, A History of Conservative Politics, 1900–1996 (116–17). Ibid., 119–20. Ibid., 119.

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Foundations of the modern Conservative Party This volume integrates these ideas and historical circumstances with a consideration of more recent events to paint a metaphorical picture of the Conservative Party’s foundations and present trajectory. Of course, by more or less ending in  1945 the previous narrative has excluded perhaps the most influential Conservative of the twentieth century: Margaret Thatcher. As already noted, with her rhetoric of individualism and emphasis on liberal markets and privatization, Thatcher arguably interjected a wide-ranging ideology into Conservative thought for the first time: a development not entirely welcomed by the Party faithful at the time. ‘As the Conservative Century came to an end, it seemed that even if the Conservative party has survived, Conservatism had not,’ historian Ewen Green wrote in 2002.16 Thus, much of this work focuses on the relationship between Conservative ideas before the Thatcher era and the path the party has taken since. It is important to note that this volume has been arranged thematically rather than chronologically in an attempt to draw out significant themes and comparisons without becoming mired in individual narratives. The first section considers Conservative ideas and ideals themselves in an attempt to draw out the intellectual ‘core’ of conservatism. Stuart Ball first examines the principles of British Conservatism in the pre-Thatcher era and illustrates the ideas that underpinned ‘One Nation’ Conservatism in this important period, which as previously mentioned was largely dominated by Baldwin and his political heirs. In the following chapter, Kieron O’Hara discusses the fate of this thread in conservative thought under Margaret Thatcher’s leadership. As O’Hara argues, Thatcher’s approach to conservative politics was not universally accepted, and her first term was in many ways circumscribed by internal battles for the future direction of the Conservative Party. Together these chapters provide the intellectual backdrop for later sections. The second section explores the Conservative Party’s approach to the Union, specifically the ‘Irish Question’ that so often dominated British politics throughout the nineteenth and twentieth centuries. Indeed, as Robert Saunders argues, political disputes over Ireland pushed some Unionists towards even advocating violence in the years before World War I. While the prospect of civil war in the United Kingdom was averted, the crisis left an indelible impression 16

E. H. H. Green, Ideologies of Conservatism (2002), 234.

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on the Conservative Party and the development of the British constitution more generally. Alan Macleod’s chapter examines the wider response of the Conservative Party to events in Ireland from the nineteenth century to the end of Gordon Brown’s government in  2010. With the first section providing an analysis of the Party’s intellectual underpinnings, this section explores the practical implications of these principles where one of the county’s most delicate and complicated issues has been concerned. Likewise, the third section focuses on the Conservative Party’s policies beyond the corridors of Westminster. The first chapter examines the Conservative Party’s changing views of Europe over the course of the mid-twentieth century. Europe has always posed a unique challenge for conservatives both politically and ideologically. By exploring the role of pro-European Conservatives in the years immediately surrounding World War II, this chapter hopes to demonstrate the depth of these differences, many of which are still easily detectable in the Conservative Party of the early twenty-first century. It also outlines why Tories have occasionally looked more positively on the European project than contemporary debates may suggest, and what this says about the party and its relationship with private sector interest. The following chapter, by Steven Howell, changes scope significantly, examining the development of the Conservative Party’s policies towards local government since 1888. As mentioned previously, localism has been placed near the top of the political agenda by David Cameron’s government, and it is instructive to examine the historical background of these contemporary developments in an effort to understand both their origins and likely outcomes. While these chapters might ostensibly seem rather dissimilar, they are here united under the same heading to illustrate the striking similarities in how Conservative policies and politicians have interacted with both supranational bodies, in the case of Europe, and local councils alike. Both have long presented frustrating challenges to Conservatives, and it is instructive to examine how Westminster-based politicians have responded. The fourth section returns the focus to Westminster and examines the relationship between conservatism and party politics. Chris Wrigley’s chapter focuses on the relationship between the Conservative Party and the Liberals (later, after the drift of the politicians on the Labour right to form the Social Democratic Party, and the SDP’s merger with the Liberals, known as the Liberal Democrats). As Wrigley observes, before 1945, the Conservative Party was in power with a Liberal coalition partner for more years than not, while after World War II coalitions became almost non-existent for any party. Wrigley explores

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the reasons for these trends, focusing on the political necessities that often seemed to demand a coalition to confront before 1945. With David Cameron’s government itself containing a significant Liberal Democrat presence in one of the country’s rare modern era coalitions, Wrigley’s observations about the nature and frequent outcomes of these alliances are particularly resonant. In the following chapter, Richard Carr discusses the Conservative Party’s internal debates over interventionism in the middle years of the twentieth century. As mentioned previously, strict Burkean interpretations of conservatism have long been sceptical of efforts to systematically intervene in society or the economy. In the midst of the 1930s, however, failing to intervene in the face of mass hardship became a matter of political debate both within and outside the Conservative Party. Carr’s chapter traces these discussions into the present day, as conservatives once again debate the merits of intervention. To do so, Carr synthesises and extends his recent output on the 1930s/40s, especially vis-à-vis Quintin Hogg. The penultimate section of this volume then examines the state of the Conservative Party in the early twenty-first century, particularly following David Cameron’s 2010 victory. The first chapter in this section is written by Sir John Major, who served as Prime Minister from 1990 to 1997.17 Sir John’s Churchill lecture came at a key juncture in British politics – some 6 months into the 2010 coalition government, after the swingeing cuts of the 2010 Comprehensive Spending Review had been announced but not fully implemented, and a matter of weeks before a controversial parliamentary vote was held to treble university tuition fees, an issue that would test the strength of the coalition. Though Liberal Democrats did indeed rebel from backing that government bill (though only just, 28 backing the bill with 29 voting against or abstaining), key figures within that party such as Nick Clegg, Vince Cable and Danny Alexander voted in favour of the measure, and thus indicated that they were prepared to ditch previous flagship Lib Dem policies in favour of remaining in government. In calling for a more permanent pact between the Liberal Democrat and Conservative parties but a couple of weeks earlier, Sir John’s lecture formed a key historical moment and one worth recording as we look to the future of both these parties. Along similar lines, the second chapter in this section examines the possible future direction of centre-right economic thought on both sides of the Atlantic. The author, Irwin Stelzer, has served as a significant adviser to leaders in both 17

Sir John Major’s essay is derived from a speech delivered at Churchill College, Cambridge on 26 November 2010. The editors are grateful for Sir John’s permission to include it in the present volume.

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the United States and Great Britain, and consequently his insight into how conservative economic philosophy should approach the challenges of the twenty-first century is particularly salient. Together these chapters serve as an important complement to the historically oriented sections that precede them. Conservatism in the twenty-first century cannot afford to be without either an understanding of its past or a plan for its future, and as a result, this volume includes a present-day focus in an effort to further the discourse on what role conservative ideas should and will play in the future. This volume, thus, covers key aspects of British conservatism. It does not – and indeed could not – address any and every issue of potential interest, however. Gender and the appeal to the female voter, particularly since the enfranchising legislation of 1918 and 1928, is not directly addressed here. Important work has been done in this area by Helen McCarthy, David Jarvis and others in recent years, and readers may wish to consult their work in combination with some of the themes this volume explores.18 The conclusion to this volume makes some preliminary comments on this issue. Similarly, some may argue that this volume could include a more direct engagement with the Disraelian legacy, but we argue there is more to be gained – given his place in a democratic political culture – by a broader consideration of Stanley Baldwin, in many ways his political descendant. The intention here is to shed light on British conservatism, but also not merely to repeat the work of others. The distinct contributions this volume makes are threefold. First, it marries chapters from historians, political scientists, contemporary thinkers and former practitioners to offer a range of perspectives on the Conservative ideal. Secondly, it unites both younger researchers and leading academics to bring forward a wave of new research regarding Britain’s oldest party. Thirdly, and most importantly, it adopts a longue durée thematic approach with an up-to-date thrust. It has been over 15  years since Stuart Ball (one of this volume’s contributors) and Anthony Seldon published their work on the Conservative Party since 1900.19 Though both would go on to edit a volume on the Tories in opposition in 2005, the implications of the 2010 election have created new space for a collection 18

19

See D. Jarvis, ‘Mrs Maggs and Betty: The Conservative Appeal to Women Voters in the 1920s’, Twentieth Century British History, 5/2 (1994), 129–52, and H. McCarthy, ‘Service Clubs, Citizenship and Equality: gender relations and middle-class associations in Britain between the wars’, Historical Research, 81/213 (2008), 531–52. A. Seldon and S. Ball (eds), Conservative Century: The Conservative Party since 1900 (Oxford, 1994).

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The Foundations of the British Conservative Party

considering the party’s history.20 The Liberals/Liberal Democrats are given much coverage in this volume, and the circumstances of 2010 may indeed prove to be particular, but there is more homogeneity of thought between the Tories and the Liberals than often – particularly during their first decade of the twentyfirst-century movement to the left – suggested. If the Liberals are a party of Lloyd George and Charles Kennedy, the reforms of the 1906 government and modern calls for a mansion tax, they are also capable of absorbing Nick Clegg and David Laws, and ditching the very left leaning policies that have garnered them sometime popularity. Their relationship with the Tories certainly makes for interesting debate. Finally, as with any publication, this volume would not have been possible without a great deal of invaluable support. As previously mentioned, many of the chapters contained here have been derived from papers delivered in the course of a conference at Churchill College, Cambridge, on 26 November 2010. The editors, who also served as the conference conveners, extend their sincere thanks to all who took part and contributed in the proceedings. The editors owe a specific debt of gratitude to Sir John Major for his conference contribution and to his staff for facilitating a wide variety of requests both before and after the event itself. The editors also wish to thank Irwin Stelzer for delivering a keynote address on a topic related to his chapter during the conference. In addition, neither the conference nor this book would have come to fruition without the exceptionally generous support of Allen Packwood, Andrew Riley and all the staff of the Churchill Archives Centre, Cambridge. This volume is appropriately dedicated to the Archives Centre as a gesture of gratitude for this support. The editors also wish to thank the Master of Churchill College, Sir David Wallace, and the fellows of Churchill College for their support for the conference and general kindness over the years. This conference looks beyond Winston Churchill – both chronologically, and in analysing political forces outside his two main alignments, the Conservative and Liberal Parties. But the institution which bears his name has formed an intellectual hub for both editors over several years, and has logistically been of much help in the preparation of this work. This book owes much to it.

20

A. Seldon and S. Ball (eds), The Conservatives in Opposition Since 1867 (Basingstoke, 2005).

Section One

The Conservative Ideal

12

1

The Principles of British Conservatism from Balfour to Heath, c.1910–75 Stuart Ball

This chapter is an analysis of the basic principles enunciated by British Conservatives in the period from the Edwardian constitutional crisis of 1910–11 to the advent of Margaret Thatcher as Conservative leader in 1975. Its concern is not the constantly changing proposals of the Conservative Party’s programme and policies, but the essential foundation of ideology and outlook upon which these depended for their coherence and validity. Throughout this period, Conservative principles were a topic of frequent discussion, to an extent which may be surprising for a party often depicted as being driven by pragmatism and a simple appetite for power, and unconcerned with – even abhorrent of – any intellectual endeavour or theoretical analysis. The reality is that the Conservatives were not disinterested in defining the principles and concepts through which they interpreted human society, and which formed the ‘guides to movement and to action’ upon which they based their expectations and strategies.1 Their specific rejection, precisely on grounds of principle, was of what they termed ‘ideology’, by which they meant something inflexible, inhumane and imposed upon society regardless of its practicality, often by coercive methods – something doctrinaire and dangerous. Statements by Conservatives repudiating any notion of being ideological (which, of course, was in itself an ideological form of inward interpretation and outward presentation) have been taken too readily at face value; indeed, to mean much more than they did and to constitute a rejection of ideas and principles in all their forms. It has to be said that such a depiction suited not only the Conservatives’ opponents, in both propaganda and the reinforcement of their sense of superior merit, but 1

P. Dean, J. Douglas and T. E. Utley, Conservative Points of View (1964), 5.

14

The Foundations of the British Conservative Party

also for much of the period it suited the Conservatives themselves, as it was a clear demarcation from their main rivals which they believed gave them more resonance and appeal with the public at large and the uncommitted voter in particular. Conservatives preferred to use terms such as ‘spirit’ and ‘faith’, even ‘gospel’ and ‘creed’, to describe the nature of their political philosophy and to mark that its wellsprings were fundamentally different from those of the left. In fact, Conservatism was ‘grounded in a system of thought’, which was composed of elements which meshed together and reinforced each other.2 This accounts for two of the striking features of the Conservative Party over the last 150 years: its resilience and its continuing relevance to the needs of its supporters. As Bernard Braine, later a long-serving post-war MP, wrote in 1946, Conservatism was ‘a distinct way of thinking’ which was ‘at once a philosophy of life, an outlook upon the world, and a temperament’.3 In the same year, a discussion pamphlet for use at the constituency grass-roots defined what drew people to the Conservative Party as ‘a belief in certain political ideals and in a certain standard of human relationships’.4 During the period considered here, there was a regular and extensive discourse which was specifically about Conservative principles and quite separate from proposals and debates about the policies to be presented in the election manifesto or implemented in government. Naturally enough, the immediate programme was usually the focus of speeches by leading figures and the propaganda leaflets produced by the party organization. Even so, the underlying principles were often acknowledged in the presentation of policy, and on certain occasions – often in specific forums – they were the main concern of a keynote speech. For the most part, however, the discussion of Conservative principles took place on the printed page, in the form of books and pamphlets written by contemporary Conservatives. Many of these authors were practising politicians, including some leading front-bench figures, while others were academics and journalists, some of whom also became MPs. This chapter draws primarily upon this extensive literature, with the aim of exploring the central themes which were common to most definitions of Conservatism. Conservative ideas before the advent of Thatcherism have been investigated only to a limited extent by historians and political scientists, with the focus mostly on the period since 1945.5 They are 2 3

4

Lord Coleraine, For Conservatives Only (1970), 20–2. B. Braine, Conservatism Today (1946), 5; A. Bryant, The Spirit of Conservatism (1929), viii; J. BoydCarpenter, The Conservative Case (1950), 7. C. J. M. Alport, About Conservative Principles (1946), 3.

The Principles of British Conservatism

15

examined here through a thematic approach, which considers the Conservative view of human nature, the fallacies of the rational approach, the organic nature of society, the inevitability of inequality, the importance of property, the strategy of adaptation to change, the value of the past, the nature of freedom, the function of authority and the role of the state. For most individuals, the principles which they acknowledged in public were to some extent a rationalization of opinions, prejudices and needs which were already held at a deeper level. In the case of those with wealth or a social position to defend, there was an element of self-interest which at the least encouraged their political outlook towards Conservatism. Nevertheless, as with the party’s supposed pragmatism, this was far from the whole story and was but one determinant among many. The Conservatives differed from the parties to their left in acknowledging and welcoming the way in which irrationalized ‘instinct’ could form a valid basis for political belief.6 This was related to the influence of ‘small c’ conservatism – a matter of temperament which, to varying degrees, was present in all people, regardless of whether they favoured the Conservative Party or not. In his influential volume, Conservatism, published in 1912, Lord Hugh Cecil took this ‘natural conservatism’ as his starting point, defining it as ‘a disposition averse from change’ which was founded upon two elements: ‘distrust of the unknown’ and ‘liking for the familiar’. From this perspective, what was known ‘has proved to be at least safe and endurable’, while change entailed ‘perplexity, effort, confusion of mind, weariness’.7 However, not all of the elements in temperamental conservatism were negative, for it also ‘springs 5

6

7

H. Glickman, ‘The Toryness of English Conservatism’, Journal of British Studies, 1 (1961), 111–43; W. L. Burn, ‘The Conservative tradition and its reformulations’, in H. Winkler (ed.), Twentieth-Century Britain: National Power and Social Welfare (New York, 1976), 82–99; R. Bennett, ‘The Conservative tradition of thought’, in N. Nugent and R. King (eds), The British Right: Conservative and Right Wing Politics in Britain (Farnborough, 1977), 11–25; W. Harbour, The Foundations of Conservative Thought: An Anglo-American Tradition in Perspective (Notre Dame, 1982); J. D. Fair and J. A. Hutcheson, ‘British Conservatism in the twentieth century: an emerging ideological tradition’, Albion, 19 (1987), 549–78; J. A. Thompson and A. Mejia (eds), Edwardian Conservatism: Five Studies in Adaptation (1988); J. Barnes, ‘Ideology and factions’, in A. Seldon and S. Ball (eds), Conservative Century: The Conservative Party since 1900 (Oxford, 1994), 315–45; M. Bentley, ‘Liberal Toryism in the twentieth century’, Royal Historical Society, Transactions, 6th series, 4 (1994), 177–201; E. H. H. Green, Ideologies of Conservatism: Conservative Political Ideas in the Twentieth Century (Oxford, 2002); K. Hickson (ed.), The Political Thought of the Conservative Party since 1945 (Basingstoke, 2005); M. Garnett and K. Hickson, Conservative Thinkers: The Key Contributions to the Political Thought of the Modern Conservative Party (Manchester, 2009); P. Dorey, British Conservatism: The Politics and Philosophy of Inequality (2011); S. Ball, Portrait of a Party: The Conservative Party in Britain 1918–1945 (Oxford, 2013), Chapter 1. E. Wood, Conservative Beliefs, NU pamphlet 2311 (1924), 3; K. Pickthorn, Principles and Prejudices (1943), 5. Lord H. Cecil, Conservatism (1912), 9–17; A. M. Ludovici, A Defence of Conservatism (1926), 2; Bryant, Spirit of Conservatism, 4.

16

The Foundations of the British Conservative Party

from contentment; it tends to tranquillity and to a desire to be left alone’.8 These unconscious impulses were regarded as setting in motion an individual’s evolution of more comprehensive and conscious Conservative views, a process which it was understood would take time to mature, as it drew nourishment from the wellsprings of experience of life and increasing responsibilities. In consequence, a ‘great strength’ of the Conservative Party was that it had ‘a firm psychological and emotional base’.9 From this was derived not a political theory, but the more elastic – but also more enduring – understanding that there was ‘a Conservative style of politics’.10

Human nature and the fallacy of reason The Conservative view of the universe was fundamentally derived from a Christian religious perspective and thus ‘rooted in the facts of nature or in Divine revelation’.11 Some of those who wrote or spoke influentially about Conservative principles had a strong personal faith, such as Lord Hugh Cecil, Stanley Baldwin and Quintin Hogg (later Lord Hailsham). While scientific discovery had undermined belief in the literal truth of the Book of Genesis, acceptance of the general Christian view of humanity was widespread. The latter provided a pervasive cultural background which was imbibed during their formative years by the middle and upper classes, from whom the Conservative Party’s leaders, MPs and key local supporters were drawn. A cardinal feature of this outlook was the acceptance of something greater than humanity as the creator, and thus it did not place man at the centre of his environment as the controlling power. Humanity was instead subordinate and had to respond to the circumstances in which it existed, rather than to seek with dangerous pride to be the master and attain a god-like omniscience. Conservatives rejected the gnosticism prevalent in radical and reformist purposes, that it was possible for humanity by its own initiatives to realize a heaven upon earth. Equally important was the Conservative recognition of human imperfection, based upon the biblical depiction of original sin: man was a fallen being who was constantly drawn by temptation towards the venal sins, and who would   8   9 10 11

F. J. C. Hearnshaw, Conservatism in England (1933), 8. T. Raison, Why Conservative? (1964), 28. Sir I. Gilmour, Inside Right: A Study of Conservatism (1977), 115. K. Feiling, Toryism: A Political Dialogue (1913), 19.

The Principles of British Conservatism

17

always take the path of the least effort and the greatest sensual gratification.12 A key element in this view was that evil resided within human hearts, rather than resulting from external forces, such as poverty, ignorance and lack of opportunity. Therefore, such environmental factors neither explained nor excused evil actions; the latter were always ultimately a matter of choice, for which the individual and not ‘society’ was responsible. While removing these factors might be a worthwhile endeavour, it would not result in any remodelling of humanity; human nature might be redeemable on an individual basis through the path of Christian salvation, but human nature in the mass was not mutable.13 Its weaknesses were intrinsic, and therefore to fail to take them into account was blind folly of the most irresponsible kind. This was the basis of the Conservative emphasis upon the limitations of what politics could achieve: The things that are most wrong in our world and always have been, the things that make people most unhappy, and always have done, are things that can scarcely be touched by political action. This is the case, because they are not defects in laws or defects in institutions, but defects in human nature; and it is in human nature that the remedies must be sought.14

Conservatives were not optimists in their appreciation of human nature, and considered that the record of history proved that in the mass, humanity’s flaws were always more evident than its strengths. Acceptance of this truth was considered to give the Conservative viewpoint the strength and flexibility of realism, so that the party developed policies which went with the grain of human nature rather than working against it.15 In this sense, Conservatism was ‘as old as the human race’.16 The sentiment that ‘the facts of life invariably do turn out to be Tory’ had a resonance far beyond Conservative Party members, or even voters.17 For the most part, at least in public statements, this outlook did not develop into pessimism or cynicism, and their consequences of drift and despair; rather, it led to the conclusion that clearly defined authority, strong legal structures and firmness in government were necessary to counter and contain the base 12

13 14 15

16 17

A. Jones, Right and Left (1944), 6; Q. Hogg, The Case for Conservatism (1947), 12–13; K. Feiling, ‘Principles of Conservatism’, Political Quarterly, 24 (1953), 135–6. This did not require personal religious belief, as ‘original sin’ was ‘an obvious truth’ of human nature: Gilmour, Inside Right, 113. Cecil, Conservatism, 91. P. Goldman, Some Principles of Conservatism (1956), 12. Ludovici, Defence of Conservatism, 60; Braine, Conservatism Today, 4–5; Dorey, British Conservatism, 6–11. Feiling, Toryism, 50. Conservative Central Office, The Right Approach: A Statement of Conservative Aims (1976), 19, emphasis in the original; Alport, About Conservative Principles, 6.

18

The Foundations of the British Conservative Party

impulses of humanity. This was also leavened by the elements of endeavour and of striving for redemption which were central to the Protestant Christian ethic, and thus, ‘it is ultimately on his respect for the dignity of the human soul that the Conservative bases his political faith’.18 This also had an aspirational aspect: ‘Conservatism sees man as a personality capable of infinite development’, and society must make this possible: ‘the Conservative is therefore concerned not only with material progress but with spiritual progress’.19 There was a further aspect of the religious influence upon the Conservative conception of human nature, which was that man could not exist in a healthy state without ideals and aspirations, and without acknowledgement of something greater and more lasting than the existence of the self. Materialism was not enough: it might provide for the body, while the spirit withered; for this reason, the theories of the Marxist left and the Socialist elevation of an impersonal state were repugnant to Conservatives in their very nature, just as much as in the threat they posed to their social position or wealth. Men and women were ‘not machines’, and ‘could not be boiled down into a mere formula’.20 The importance of an appeal to idealism was acknowledged by Conservatives; it was an article of faith that faith was necessary, that the public must be offered something more than a dour defence of the ‘haves’ against the ‘have-nots’ and negative criticism of the proposals of opponents.21 Although, if unrestrained, humanity might descend to the law of the jungle and the crude application of ‘might is right’, Conservatives believed that man could only survive in coherent social groups and that these needed a moral code – very probably religious in origin and purpose. This morality derived from a fundamental need of the human condition and psyche, so that individuals could establish relationships with others around them, first in their own families and then linking these together in the larger society.22 Anything else left mankind as atomized beings, promoting conflict and rejecting charity; this was the cause of the Conservative distrust of pure individualism (and hence the concern of the traditional ‘one nation’ strand of Conservatism at the Zionistic advocacy of the free market during the height of Thatcherism), despite their endorsement of the improving moral as well as economic benefits of increased opportunity, freedom and choice. For many Conservatives, a secularized society 18 19 20

21 22

D. Stelling, Why I Am A Conservative (1943), 25; Cecil, Conservatism, 164. D. Clarke, The Conservative Faith in the Modern Age (1947), 8. Winchester Conservative Association, North Stoneham & Bassett Women’s Branch, 28 June 1923, Southampton Record Office, D/STC/1/1–2. Salisbury to Baldwin, 26 January 1924, Cambridge University Library, Baldwin MSS, 159/258–61. Hogg, Case for Conservatism, 16, 18.

The Principles of British Conservatism

19

lacked the essential component which would give it a moral structure, and hence the reaction at many levels – including the grass-roots – to the social changes of the 1960s and 1970s. The moral code would need constant support if it was to succeed in restraining the powerful impulses of human nature, and it could not be imposed upon people from without, whether by legislation or a state police. It had to be fostered within people, and the surest way to do so was by encouraging aspirations and establishing standards of behaviour, by means of the examples set by the leading elements of society. This was in tune with Conservative preferences for hierarchy and social order, and for leadership and responsibility to flow through that structure; it was also the cause of hostility to those within the elite who turned against it or whose conduct undermined it. Following from this view of human nature, the second fundamental element in Conservatism was a rejection of the rational approach. This was as flawed as the humans who had developed it; indeed, that must be so, for human thought could not transcend its own nature, which contained elements of irrationality. Reason could, therefore, never be ‘pure’ or ‘abstract’, nor could it be divorced from the past or detached from present society. On the contrary, reason was limited, and a weak force rather than a strong one – as with individual conscience, it often could not withstand the other impulses in human nature and the temptation to wrongdoing.23 The rational approach was a fallacy not only because it ignored the nature of humanity, but also because it sought to set itself above it, and thus to ascertain truths of superior worth and universal application. To Conservatives, such claims were deeply suspicious, and they favoured the insights and warnings provided by instinct rather than logic. Where they spoke of the merits of ‘common sense’, what they meant was the store of experience and custom which had been laid down by many generations, and which should not be disregarded in favour of the theory of one person or the ephemeral fashion of one generation, however convincing or rewarding this might appear on the surface.24 From this flowed their critique of Socialism, which might be admirable in its utopian objectives but would never attain them due to its naive optimism and its assumption of the power of reason; it was based upon an imaginary world, which the facts exploded.25 A criticism of ‘Radical and Socialist theoretical politicians’ published in 1912, which would have been even more strongly endorsed by Conservatives six decades later, was ‘that they try to make that part of humanity with which they have to deal fit 23 24 25

K. Feiling, What Is Conservatism? (1930), 10. Goldman, Some Principles of Conservatism, 7; Feiling, Toryism, 132–3. A. Duff Cooper, The Conservative Point of View, National Union leaflet 2616 (1926).

20

The Foundations of the British Conservative Party

their theories and their measures rather than making their measures fit the men’, and ‘because they neglect these essential unclassified elements of human nature, their well-meant measures will work evil, not good’.26 The antithesis of the ‘abstracts and systems’ which attracted the left was ‘the Conservative belief that no general principle is universally applicable’.27 Any general theory was bound by its nature to ignore specific circumstances or to seek to override them. As Conservatives from Edmund Burke in the late eighteenth century onwards had argued, the situation in which people found themselves was of more importance than the theory, not less, for the latter could be changed more easily than the former. Conservatives accepted that the complexity of society and politics was such that many variable, unpredictable, contingent and transient factors were in constant interaction, in a state of malleable flux which the rationalist approach failed to encompass. For this reason, ‘the first duty of a humane government is to accept the facts of human nature as they actually are’.28 The application of principles based upon a priori reasoning was, therefore, inappropriate, whatever abstract conception it started from – whether this was the divine right of kings, the natural rights of man or the supreme will of a dictator. The same factors led Conservatives to reject the ‘spurious intellectual pride’ and programmatic nature of Liberal and Socialist policies, and to dismiss the promises made for their results: at best, these were over-optimistic and exaggerated; at worst, many Conservatives suspected, they were knowingly and cynically unattainable.29 By contrast, Conservatism was ‘a practical attitude, rather than a reasoned creed’.30 While it was founded upon truths about the human condition, these could not be extrapolated into a programme for action. Conservatives certainly did not welcome chaos, especially in society or in politics, but they accepted the vagaries of human endeavour, the intrusion of the unforeseeable into the best laid plans and therefore the unpredictability of outcomes: ‘this is not a world in which anything can be taken for granted’.31 This enjoined caution, of taking small incremental steps rather than great leaps forward, and the importance of looking behind as much as ahead, to learn from the past rather than to reject it. Conservatism provided tools other than those of reason, with tradition, 26 27 28 29 30 31

P. Loftus, The Conservative Party and the Future (1912), 12–13. Gilmour, Inside Right, 113–14; Boyd-Carpenter, Conservative Case, 5. D. M. Crichton (ed.), Tory Oxford: Essays in University Conservatism (1935), 39. Alport, About Conservative Principles, 7. A. Boutwood, National Revival: A Restatement of Tory Principles (1913), 4. Raison, Why Conservative?, 43.

The Principles of British Conservatism

21

prudence, empiricism and adaptability being among the most useful. There was no single path and no master plan: Conservatism ‘does not claim to possess the keys or the Kingdom. There is no certainty about the route and no certainty about the destination’, wrote Ian Gilmour at the end of this period.32 During the first three-quarters of the twentieth century, Conservatism was above all empirical in its approach and navigated by ‘rule of thumb about what is practical and tolerable’.33 Conservatives were quite willing to be labelled as ‘pragmatic’ or ‘realist’, as they regarded these terms not as the antithesis of principle, but as its accompaniment; in this respect, both of these terms were regarded as being very different in nature from opportunism. The latter had no guiding spirit with which to keep it safe, and thus alienated Conservative opinion, as was seen with the decline and fall of the most opportunistic government of this period, the peacetime Lloyd George Coalition of 1918–22. Conservatives held that there must be a balance between principle and practise, in which each informed the other. The surest guide to the best course to follow would develop from this, based not upon abstract theory propounded by individuals, but upon the strengths of the broad-based and collective fusion of experience, custom, caution, moderation, toleration and practicality which Conservatives venerated as ‘common sense’. This was something innate rather than learned, and believed by Conservatives to be a particular national characteristic of the British people which explained the stability and success of their national development, and the superiority of their existing political institutions over alternatives derived from suspect foreign sources, whether of the Marxist left or of the Fascist right.

The nature of society The next most important foundation of Conservative principles was the belief that society was an organic entity, which had grown naturally over time.34 As with any living organism, it could not be taken apart without serious – possibly fatal – consequences for its health. It was not a machine which could be operated in a predictable way once clever men had discovered the control levers, nor could it be redesigned according to their intellectual blueprints, however neat and logical 32 33 34

Gilmour, Inside Right, 120, emphasis in the original. Pickthorn, Principles and Prejudices, 7. Clarke, Conservative Faith in the Modern Age, 13, 38.

22

The Foundations of the British Conservative Party

these might seem on paper.35 Society was composed of a myriad of shifting connections and fluid relationships, ‘an organic whole in which the several atoms react in all their movements upon one another’, and therefore was complex and subtle to an extent which placed it beyond the comprehension of individual mortals.36 To consider otherwise was to assume a god-like omnipotence; this would inevitably be exposed as hubris and delusion, but not without having inflicted suffering – perhaps fatal – on both individual innocents and society as a whole. The human society which had evolved over centuries could not be reduced to the automated predictability of a ‘system’ or captured in the reductionism of a ‘model’. Conservatives were suspicious and sceptical of those who sought to establish general laws of human behaviour or to discern patterns of such universal regularity that they could be defined as formulae, and so made into tools with which to manipulate society. They rejected as selective and simplistic the social theories of the left, from Marx in the nineteenth century to moderate British Socialists such as Laski in the mid-twentieth, and were unconvinced by the claims of academics in the new disciplines of the social sciences – a term which most Conservatives regarded as an oxymoron.37 The concept of restructuring society on a ‘scientific’ basis filled most Conservatives with horror; the elimination of uncertainty which this intended was not just impossible, but also undesirable: the result would be a society fossilized, regimented and devoid of humanity.38 This was a significant element in the Conservative critique of Socialism, which ‘makes the mistake of supposing that if only the machinery is skilfully constructed it will go of itself ’.39 Another concept which Conservatives rejected as a rationalist abstract fallacy was that there was a capitalized entity of ‘Society’ which had a separate existence or moral authority superior to its members; this was the point later made in Mrs Thatcher’s famous but misunderstood statement that there was ‘no such thing as Society’.40 A core element of the Conservative outlook was that inequality was a natural and inevitable part of the human condition, and so also was the stratification of society.41 These might, at first sight, seem to be dangerous tenets to hold in 35 36 37 38 39 40

41

Hogg, Case for Conservatism, 24–5; Coleraine, For Conservatives Only, 35. D. Clarke, The Conservative Faith in the Modern Age (1947), 13. A. Maude, The Common Problem (1969), 87–91. G. Rippon, Right Angle: A Philosophy for Conservatives (1969), 7. H. M. Adam, The Fallacies of Socialism (1926), 11. Clarke, Conservative Faith in the Modern Age, 20; Thatcher’s comment was made in an interview published in Woman’s Own, 31 October 1987. R. Rose, ‘Tensions in Conservative philosophy’, Political Quarterly, 32 (1961), 281; T. E. Utley, Essays in Conservatism (1949), 46; B. Patterson, The Character of Conservatism (1973), 22–5; Dorey, British Conservatism, 11–15.

The Principles of British Conservatism

23

the era of a democratic franchise after 1918 and the succeeding impulses to the egalitarianism of World War II and the 1960s. Conservatives were certainly careful of their language, so as to avoid the appearance of hostility to democracy itself (especially in the interwar period) or of reactionary intentions (especially after 1945). However, the concept itself did not need concealment from public view, as it was based upon a recognition of reality which every adult would acknowledge. Humanity was not cast from one mould: it was a self-evident fact that human beings were born with different degrees of physical strength and intelligence, and to a large extent the similarly vital attributes of health and mental factors such as adaptability and resolution were also random variables. Attempts to ignore or eliminate inequality were, therefore, futile endeavours and indeed unnatural in conception as they sought to replace a natural state with an artificial order, conceived on the basis of an assumed omniscience of human rationality. Such order could only be imposed from outside, and applied and maintained only by regulation and – given human nature – coercion and punishment, which might range from penalizing forms of taxation to confiscation of property by nationalization and ultimately to the concentration camp and mass murder. Thus, in self-defeating paradox, absolute equality could only be achieved by the most unfair and extremely inegalitarian of methods, by using the powers of the state to intervene against the abilities, aspirations and living standards of some groups and strata in society, despite their having done nothing in breach of the law. Owing to the variation of innate human characteristics, Conservatives had no faith in the probability of raising everyone up to the level of the highest attainment, and were well aware that levelling down to the lowest common denominator was bound to end up being the reformers’ strategy, whatever pious hopes might be on their lips at the outset; this was one of the reasons for growing Conservative hostility, especially at grass-roots level, towards the move to comprehensive schooling from the 1960s onwards. Conservatives were not opposed to the removal of ‘irrelevant or unfair inequalities’ which acted as restraints upon attainment, provided that this could be afforded without undue financial costs and without placing strains upon the fabric of society.42 There was an increasing element of meritocracy in the Conservative outlook, which the cultural atmosphere of the post-1945 period encouraged.43 However, it was not only long before the era of Thatcherism, but also before World War II, that the Conservatives presented themselves as the 42 43

Rippon, Right Angle, 13. Raison, Why Conservative?, 38, 139.

24

The Foundations of the British Conservative Party

promoters of opportunity and the defenders of choice. They contrasted their belief in an upwards ladder, where achievement was based upon effort and merit, with a Socialist plateau of dull and discouraging uniformity. There was nothing new in the assertion made in the Conservative Party policy statement of 1976: ‘we believe in levelling up, in enhancing opportunities, not levelling down’.44 The Conservative approach to improving the health of society was concerned not with the manipulation of an inert mass of humanity, but with the dynamism and motivation of the individual, which could only come from within: ‘every man should endeavour to raise himself by his own efforts to the highest point to which his nature can attain’.45 This was a matter not just of material advance but of spiritual progress; while people had unequal gifts, there should be ‘equality in the possibility of developing these gifts and in the right to do so’.46 Human society could seek to create either an environment which fostered this or one which stifled it; the latter became an increasingly vocal Conservative criticism of government regulation and the operation of parts of the Welfare State by the 1970s. Conservatives held strongly that individuals should be rewarded for their efforts and achievements. This was firstly because, given human nature, humans would not exert themselves or be venturesome if there was no incentive and if the results of laziness and selfishness were just as good. Secondly, Conservatives considered that those who were hard-working, enterprising and successful had beneficial effects upon others as well as themselves. This was not only through the obvious material improvements which resulted from their innovations or the goods which they produced, the employment which they created and their greater proportionate contribution through taxation to the benefit of others; there was also a moral dimension, that society was healthier as a result of such exemplars of the virtues of forethought, insight, application and organization. In the Conservative view, social order was founded upon the rights of property, which were not a matter of selfishness or greed.47 Of course, there were owners of property who were motivated by material acquisition or were jealous and fearful of their position and acted narrowly on that basis; this inevitable aspect of human character was not admirable, but attempts to thwart it were folly and futile. For Conservatives, the importance of property was that it provided social stability and was a guarantor of independence and privacy, and thus also of 44 45 46 47

The Right Approach, 18. Bryant, Spirit of Conservatism, 10. Clarke, Conservative Faith in the Modern Age, 8. Bryant, Spirit of Conservatism, 11–15; Feiling, ‘Principles of Conservatism’, 134.

The Principles of British Conservatism

25

freedom.48 The possession of property gave an individual or family a measure of security and a stake in society; in order to retain their property, they needed to avoid unwise risks (which included political leaps in the dark), to participate in society and politics, and to be vigilant in defence not only of their own rights but also those of all property owners. Property encouraged thrift and endeavour, and fostered a sense of responsibility, all of which were of value to society as a whole as well as to the individual. The possession of property satisfied natural and commendable human instincts: to establish a secure home for the family, to make provision against illness and old age, to pass on an inheritance to children, to rely on the efforts of self rather than on the charity of strangers and to be rewarded for hard work, improved skills or good judgement.49 Property also encouraged a sense of community, and its wide diffusion would draw social classes together; therefore, saving and investment – especially in housing – on the part of the lower classes was to be encouraged. In the pamphlet of 1924 which first proposed that a ‘property-owning democracy’ be the Conservative aim, the young MP Noel Skelton argued that the stability and longevity of a civilization was directly related to ‘the widest possible extension amongst its citizens of the private ownership of property’.50 It was not necessary for this that the quantities of property should be made equal: the examples of greater ownership encouraged emulation, while confiscation for the purposes of equalization would be a disincentive and unjust, by rewarding the lazy and feckless at the expense of the hard-working and prudent. On the contrary, economic inequality was unavoidable in a free society; due to the variation in human ability and character, even if all were somehow to start out equal, they would not end up so, while the freedom to strive for gain would not be real if it did not also include the possibility of loss. However, property was not something to be enjoyed in a selfish or careless way; there was an element of trust, present in moral tone rather than in legal obligation, that property should be used in ways that increased its security and value, both of which were of benefit to society as a whole. In this sense, Conservatives were agreed that property ‘has its duties as well as its rights’.51 48

49

50

51

Hogg, Case for Conservatism, 97–9; Dean et  al., Conservative Points of View, 10–11; The Right Approach, 17. Cecil, Conservatism, 119–20; P. Worsthorne, ‘The ideological setting’, in Conservatism Today: Four Personal Points of View (1966), 29–30. N. Skelton, Constructive Conservatism (1924), 9, 23; H. Sellon, Whither, England? The Letters of a Conservative (1932), 171, 157; D. Eccles, About Property-Owning Democracy (1948). Sir R. M. Banks, The Conservative Outlook (1929), 15.

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The Foundations of the British Conservative Party

Change and tradition At the most basic level, the function of Conservatism was – as its name declared – the preservation of the existing and the resisting of the new, at least until it had proven itself to be both necessary and safe. Conservatism was certainly opposed to sudden and extensive changes in the social or economic system, especially – but not only – if these were achieved by violent means or by the destruction of existing institutions.52 This opposition was based on a powerful combination of factors: fear and self-interest, temperamental dislike of upheaval and uncertainty, scepticism of any beneficial result and a principled preference for incremental change that was based upon consensus and consent. Man could not remake the world in his own image, and attempts to do so would not only fail, but also leave things worse rather than better – and the bolder and grander the plan, the more this would be the case. However, while political action could not change the nature of humanity, this did not mean that social, economic or environmental reforms should not be undertaken; it was rather that they should be embarked upon for practical and realizable purposes, and without unrealistic expectations. A central tenet of Conservatism since the term came into common use in the 1830s was the recognition of ‘change in order to preserve’. Rigid rejection of any reform would simply stoke up pressure and force the advocates of change to adopt more extreme panaceas and more dangerous tactics, and it was, therefore, unrealistic and counterproductive. Conservatism did not seek a frozen or fossilized society; ‘on the contrary, its empirical approach to political problems predicates change’.53 Furthermore, as one of the founders of the One Nation Group pointed out, ‘Conservatives believe in variety rather than uniformity, and innovation is essential to the maintenance of variety’.54 Of course, Conservatives should not rush to embrace change before its need was clearly demonstrated (which was a regular grass-roots and backbench criticism of Conservative leaders, including Peel in 1845, Disraeli in 1867, Baldwin in the mid-1920s, Macmillan in the early 1960s and Heath in 1972–74), and in this respect, issues of timing and tactics were also issues of principle. While most Conservatives would not go quite as far as the concept expressed in the title of the One Nation Group’s mid-1950s’ publication Change Is Our Ally,55 to varying degrees (more so on the left wing, of 52 53 54 55

Lord H. Cecil, Conservative Ideals, National Union leaflet 2184 (1923), 2. Boyd-Carpenter, Conservative Case, 10. Maude, Common Problem, 285; Alport, About Conservative Principles, 14. Conservative Political Centre, Change is our Ally (1954).

The Principles of British Conservatism

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course, and least so on the ‘diehard’ right), they accepted that from time to time change had to occur and that it was far better that this should be managed in the safe hands of Conservatives. For Conservatives, statesmanship lay in recognizing the facts of a situation and steering a course which was guided by principles in its aims and methods, but which adapted these to circumstances as they actually existed. In this way, ‘the Conservative attitude to change must clearly often be purely responsive’, especially because ‘necessary change is often unpredictable’.56 Furthermore, it was the circumstances, rather than the principles, which would determine whether the outcome was success or failure, or – most likely in the eyes of most Conservatives – something between the two. This was the basis of the Conservative emphasis upon prudence, which gave a measure of control over the pace of progress, but did not prevent it. Careful and considered reform, undertaken when there was widespread agreement on at least its necessity, and if possible also its form, was accepted by Conservatives from Burke onwards as an essential attribute of a healthy society. Indeed, as Peel had argued when adopting the term as the party name in the 1830s, it was the only reliable method of conservation. In this view, reform did not pave the way to revolution, but instead was the surest road away from it.57 On the other hand, an unthinking defence of all aspects of the status quo and a blanket denial of all criticism was far from wise, for it lowered everything to the same vulnerable status as its most indefensible parts; such a strategy did not defend everything, it risked everything. The Conservative spirit of reform was one of reluctance, but not of refusal: ‘the Conservative mind is one which seeks a proper balance between stability and change, order and progress’.58 The manner of change was as important as its content: ‘healthy change must be natural, evolutionary, organic change’.59 The essential priority was continuity, a process of change which kept as much of the past as possible and was infused by an awareness that ‘few things are more painful or perilous than rapid change’.60 Thus, changes to the mode of operation of an institution were preferable to changes of its basic nature, and reform was always preferable to abolition; both of these attitudes were shown clearly, though with internal Conservative dissent – some of it bitter – in the crisis over the House of Lords in 1909–11.

56 57 58 59 60

Gilmour, Inside Right, 127. Hogg, Case for Conservatism, 26. Braine, Conservatism Today, 4. Goldman, Some Principles of Conservatism, 10. Utley, Essays in Conservatism, 8; Loftus, Conservative Party and the Future, 10.

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The Foundations of the British Conservative Party

The importance of the past was another significant element in the Conservative outlook. This took several forms, the most important of which were that history provided a wealth of human experience that should not be set aside, that custom and tradition were the foundations of a stable society and that the only safe and healthy form of progress was evolutionary and not revolutionary.61 The lessons of the past were relevant to the future, because whatever progress may have been made in human knowledge and material circumstances, human nature remained unchanged. Conservatives also held that each generation acted as the trustee of society rather than its sole owner, with consequent limits upon the proper scope of its actions: society was ‘composed not only of the living but of the dead and the still unborn’.62 What had been handed down to the present deserved at least the benefit of the doubt, for ‘the fact that things are as they are is some evidence that that is how they should be’, while ‘the onus of proof rests upon the proponents of change and not on its opponents’.63 Continuity with the past should be preserved as much as possible, to diminish disruption and maintain stability: ‘without this, the stability of our national life is in constant danger, and without stability, real social security cannot exist’.64 The greatest priority was to preserve and strengthen all those things which had proved their utility and value, for ‘whatever has worked once may work again’.65 This was particularly the case with the constitution and the legal system, and ‘the strength of the Common Law’ was that it was ‘based upon custom and established by precedence’.66 It also applied to the Conservative Party, and hence the emphasis on political consistency with immutable core values: by such means, ‘the captains of Toryism in the past can be made the instructors of Toryism in the present’, so that ‘the Tory tradition is the Tory hope’.67 The national past was a vital source of inspiration and guidance, and so ‘the only text-book of Conservatism is the history of the British people’.68 Conservatives held that habit and custom had a greater hold upon people than did reason, as the prevalence of superstitious beliefs demonstrated. They had to be worked with and not against, to be modified and reshaped for changing times and circumstances – but without losing their connection with the past, 61 62

63 64 65 66 67 68

Coleraine, For Conservatives Only, 26–7. Braine, Conservatism Today, 5; Feiling, Toryism, 25; Crisp, Rebirth of Conservatism, 15; P. Loftus, The Creed of a Tory (1926), 36. Boyd-Carpenter, Conservative Case, 10. Alport, About Conservative Principles, 5. W. Elliot, Toryism and the Twentieth Century (1927), 4; Banks, Conservative Outlook, 1. Patterson, Character of Conservatism, 17. G. Butler, The Tory Tradition (1914), ix. Clarke, Conservative Faith in the Modern Age, 7, 10–12.

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and without the negation of their historic value and purpose. The test was that reforms ‘must take account of the National Character and National History’.69 Conservatives held in high regard the importance of belonging in both time and place to a community, the membership of which provided security and identity, but also entailed obligations. There were local forms of this, but it was of the greatest value as a national patriotic feeling. This also was based on history: past achievements and the leading figures associated with them were frequently cited and celebrated, with pride in national success and also as exemplars of what were regarded as the virtues of the British (but generally termed ‘English’) character: ‘the spirit of adventure, independence of character, individual effort, courage and fortitude’.70 Thus, ‘Conservatives place patriotism at the top of the list of civic virtues’.71 The identification of the Conservative Party with the national character was a core element in its identity, founded upon the assumption that Conservatism was ‘an essentially English attitude of mind’.72 Conservatives wished to foster social unity within the nation and were opposed to the concept of a class solidarity which crossed national boundaries; the nation, ‘rather than any wider unit is the natural focus of political loyalty’.73 However, until the early 1960s, for Conservatives there was one ‘wider unit’ which aroused their passionate loyalty: the British Empire, the product of British enterprise and endeavour, connected to the mother country by ties of settlement and sentiment that were more profound than those of trade. The history, the mystique and the various visions of the mission of empire had a powerful appeal to the Conservative imagination, inspiring the efforts of voluntary members and contributing an important part of its wider public appeal at least until World War II. Even more resonant, over a longer period, was the emphasis upon national unity: Conservatism was ‘impregnated with a belief in the essential unity of the nation’, so that ‘all sections and classes in our community are all members of one another’.74 This was not at all the same as social homogeneity: it was not ‘a forced similarity untrue to nature’, but ‘a harmony of variations and opposites, held in equilibrium’.75 Conservatives considered that the common interests between 69 70 71 72

73

74 75

Loftus, Conservative Party and the Future, 12. Empire Day, National Union leaflet 2559 (1925); Braine, Conservatism Today, 15. Hogg, Case for Conservatism, 32. R. Cartland (ed. B. Cartland), The Common Problem (1943), foreword by Lord Selborne; Patterson, Character of Conservatism, 31–3. R. Hornby, ‘Conservative principles’, Political Quarterly, 32 (1961), 230; ‘A Modern Conservative’ [C. Alport, pseud.], A National Faith (1938), 89; Clarke, Conservative Faith in the Modern Age, 13–16. Boyd-Carpenter, Conservative Case, 7. Feiling, ‘Principles of Conservatism’, 138.

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The Foundations of the British Conservative Party

classes were greater than anything dividing them, and their responsibilities to each other and to an overarching national interest were more important than their antagonisms. This was often described as ‘one nation’ Conservatism and linked back to Disraeli’s romantic Toryism for legitimacy. It had a wide influence, extending far beyond the party’s left-wing or any organized group; from Balfour to Heath, the party was led on the basis – both principled and pragmatic – that a Conservative ‘ought to be humane and aware that we are all part of an interdependent community’.76

Freedom, authority and the state Writing at the mid-point of the twentieth century, John Boyd-Carpenter MP considered that ‘above all the spirit of Conservatism is to be found in the Party’s policy towards the individual’.77 The Conservative emphasis upon the freedom of the individual had its origins in the underlying Christian ethos which shaped attitudes until the last quarter of the twentieth century: that each person had equal merit in the eyes of God, and that every human soul was of value, whatever the person’s wealth and status.78 However, the crucial consequence of this religious influence was the corollary that each individual was responsible for his or her actions and that personal circumstances did not excuse failure in this respect. Foreshadowing late-twentieth-century Conservative criticism of the ‘Nanny State’, Pierse Loftus declared in 1912: ‘citizens must be treated as men – not as children’.79 Freedom was, therefore, linked inextricably to two other equally important Conservative priorities: order and duty. The latter was the recognition that individuals had obligations in widening circles to those around them: to their family, their locality and their nation.80 For Conservatives, duty came first, for without it society would dissolve into anarchy. Conservatives were, therefore, uncomfortable with pure laissez-faire, unbridled capitalism and unregulated free markets, all of which they regarded as forms of Liberal ideology taken to excess – as, indeed, many Conservative critics of aspects of Thatcherism argued in the 1980s. The problem with a ‘devil take the hindmost’ attitude was firstly just that, 76 77 78 79 80

Raison, Why Conservative?, 43. Boyd-Carpenter, Conservative Case, 27. B. Braine, Conservatism and Youth: As A Young Man Sees It (1939), 19. Loftus, Conservative Party and the Future, 24. Feiling, ‘Principles of Conservatism’, 133.

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that the devil indeed would – leading to alienation, the corrosion of social bonds and an unravelling society in which it was unsafe to live. Even more dangerous than the creation of an underclass likely to reject morality and turn to crime was the abdication by the upper class of its duties of care and service should it turn to self-absorption, self-indulgence and provocative displays of wealth and consumption; hedonism could be as dangerous as Socialism. Thus, while the individual could have certain reasonable expectations of society, society placed obligations upon its members – and the latter took priority, especially in times of national peril; this was the reason why Conservatives had no objection of principle to conscription in wartime, or to the setting aside of peacetime freedoms and property rights. The mantra that duty and service should come before, and so justify, rights and privileges, was repeatedly urged by Baldwin in the 1920s and 1930s, driven by his fear that the new mass democracy would be materialist and selfish in outlook.81 As the party’s committee examining the welfare proposals of the Beveridge Report of 1942 declared, it should be the aim of Conservatives ‘to build up a brave, healthy, industrious and independent population devoted to the cause of freedom and alive to the responsibilities which such a cause demands, and brought up to put duty and service before rights and privileges’.82 These attitudes shaped the Conservative view of liberty, and of its limits; it was ‘the acceptance of those principles of mutual service which are the condition of all ordered liberty’.83 Liberty was essential to allow individuals to develop and improve, morally as much as materially, for ‘real virtue can only grow if men have enough liberty in which to exercise choice and develop their characters’.84 It had other beneficial aspects, as ‘political liberty is nothing else than the diffusion of power’.85 For similar reasons, the constant Conservative preference was for a limited state, which had the first duty of protecting the liberty of the individual from abuse by others, rather than taking more authority for itself. The state ‘must give freedom to the individual to live his own life as he wishes – even though he ruin it; yet it must check his power to ruin the lives of others’.86 Thus, the Conservative Party ‘understands the importance of the balance of forces, and

81

82

83 84 85 86

S. Baldwin, Service Of Our Lives (1937), 157; Conservatism in a Nutshell, National Union leaflet 3773 (1945). Post-War Problems Central Ctte., report of ctte. on the Beveridge Report, 19 January 1943, Bodleian Library, Conservative Party Archive (hereafter CPA), CRD/2/28/6. Sir G. Lloyd and E. Wood, The Great Opportunity (1918), 10. Goldman, Some Principles of Conservatism, 13. Hogg, Case for Conservatism, 63; Patterson, Character of Conservatism, 22. Loftus, Conservative Party and the Future, 24.

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guards this balance against over-powerful state and over-mighty subject alike’.87 This led to the Conservative preference for decentralization and the devolution of power, with a vigourous, responsible and reactive role for local government. There were certainly limits to the forms or expressions of liberty that were consistent with a healthy and stable society, and Conservatives were not disposed to social or moral libertarianism. These carried the dangers of self-indulgence, irresponsibility and ultimately of social dissolution, eroding the standards of behaviour that should be aspired to: ‘Conservatism therefore jealously guards personal liberty, but it abhors licence.’88 The Conservative view of freedom was quite compatible with a hierarchical social structure, an established state church, legal sanctions against minority sexual behaviour and censorship intended to maintain conventional morality. Conservatives did not regard freedom and authority as being antagonistic to each other, and so their party ‘combines with a respect for authority and order a real love of individual freedom’.89 Both were necessary, in their different but often complementary forms, so that ‘the essence of government is the maintenance of the balance between freedom and order’.90 For this reason, the Conservative Party had resisted the excess of Victorian non-intervention in the past, just as it resisted Socialist overcontrol in the present.91 It was understood that ‘democracy does not work if there is weakness at the centre’, and that ‘a government must have authority’.92 There had always been a preference for a strong executive which possessed the necessary coercive power and the necessary will to use it, in order to ensure peace and the rule of law within the nation, and to defend it from the ambitions or hostility of other nations around it. Thus, Conservatism had inherited ‘the traditions of Toryism which are favourable to the activity and authority of the State’.93 However, the latter needed to be restrained, and state action to be shown as necessary by the nature or scale of the problem and the failure of individual or collective voluntary action to remedy it. For Conservatives, the relationship between government control and individual liberty was variable according to the circumstances of each case; while there was no universally correct position, there were universally relevant guiding 87 88 89 90 91 92 93

Raison, Why Conservative?, 28; The Right Approach, 18–19. Braine, Conservatism Today, 6. Banks, Conservative Outlook, 262. Dean et al., Conservative Points of View, 7, 9–10. Hornby, ‘Conservative principles’, 231. Raison, Why Conservative?, 30. Cecil, Conservatism, 169.

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principles. One of the oldest-established of these was that authority should not be arbitrary in its actions or discriminate without cause between groups within society. In this respect, government was constrained by whatever moral code was prevalent in society, for the need for consent meant that the governors could not far exceed the tolerance of the governed. To do so was misgovernment, and to govern by force alone was to lose legitimacy. Albeit reluctantly, during the twentieth century, Conservatives accepted this truth about British government in lands where the native population was of a different ethnicity: first, in Ireland with the abandonment of the reprisal policy and partition in 1921; secondly, in the devolution of power in India, from the Government of India Act of 1935 to independence in 1948, and thirdly, in the process of decolonization in the 1950s and 1960s. A healthy society depended upon the acceptance by its citizens of the legitimacy of its institutions, and a key aspect of this was that they should be natural growths from the past which embodied the shared values of society, and not be imposed from outside or according to some intellectual theory. Governing institutions must operate according to the accepted ethical code of society: if they were arbitrary or corrupt, they would alienate the population and lead to their destruction in revolutionary chaos – from which, quite possibly, an even more uncontrolled and violent system might emerge, as with Bolshevism after the Russian revolutions of 1917. For British Conservatives, the widespread cultural value of fairness, or ‘fair play’, was extremely important. Conservatives placed great emphasis upon the importance of justice: equality before the law, rather than economic equality, was what concerned them. The legal system was the defender of the weak against the strong, and of the individual citizen against an overmighty state. Institutions had to act according to their own stated rules, neither failing to protect the public nor extending their own authority at the public expense – the latter being a constant Conservative suspicion of the bureaucracy of the state, both national and local. The state could seek to minimize injustice and to create an environment of peace and stability, but it could not and should not supplant the responsibility of individuals to conduct themselves in accordance with moral imperatives and civic duty. Such a moral intervention was neither right in principle nor workable in practise, for ‘man cannot be made good by Act of Parliament’.94 It was ‘the struggle of the conscience’ which strengthened

94

R. Northam, Conservatism: The Only Way (1939), 61.

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The Foundations of the British Conservative Party

the personal and moral development of the individual, while ‘excessive direction from above weakens the forces of good and tempts the forces of evil’.95 In domestic politics, ‘constitutional authority remains the first article of a Conservative creed’.96 The Conservative view of the constitution was imbued with the weight of history and the pride of patriotism, and recognized that it ‘embodies racial character and inherited ideals’.97 Its key components were ‘a free parliament, an impartial law, a national monarchy and the Christian religion’.98 Their effectiveness and stability were based upon a division of functions between the different institutions, especially in the independence of the judiciary, so that ‘power should be widely dispersed’.99 Up to the early 1960s, but much less so in the decline and difficulties of the next two decades, there was confidence – indeed, complacency – in the superior merits of British political institutions to those elsewhere, even those that had grown from similar roots, such as in the United States. This did not mean that there were no causes of concern or room for improvement, and during this period there were repeated lamentations of the decline of the scrutinizing role of Parliament, the shift of power to the executive, the power of party organizations and the declining independence and standing of the backbench MP. A good deal of this was based upon ‘golden age’ myths about the political system of the previous century, but there was certainly a sense of being overborne in a tide of legislation, much of it eroding the freedom of individuals, and an encroaching extension of a more impersonal state. Conservative conceptions of the role of government were based on the understanding that ‘the State is not simple but complex, not uniform but a harmony of opposites’.100 The Conservative view of the state was from monolithic: in some areas its intrusion was resisted, while in others it was accepted as necessary, generally either because private initiative had failed or because of an external threat. While the preference was for a limited state and minimal intervention, there were criteria which overrode this – in particular, national defence must be adequately provided for, and economic forces which might affect social stability or national unity must be countered.101 However, experience encouraged caution, for ‘the State is a clumsy, rigid instrument, difficult to handle and operating heavily Clarke, Conservative Faith in the Modern Age, 20. Hogg, Case for Conservatism, 47.   97 Feiling, ‘Principles of Conservatism’, 132.   98 Alport, About Conservative Principles, 5–6.   99 Hornby, ‘Conservative principles’, 231; Bryant, Spirit of Conservatism, 46–7. 100 Feiling, What Is Conservatism?, 14. 101 Northam, Conservatism, 105.   95   96

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and unexpectedly’.102 As Lord Cranborne, the leader of the party in the House of Lords, warned in the closing months of World War II – a conflict which for many outside the Conservative ranks had vindicated an enlarged role for the state – the latter was in reality no more than ‘a combination of politicians and officials, most of them of very ordinary capacity’.103 The state had no moral authority, as it was ‘nothing more or less than the people who, at any particular time, comprise it’, and so it was ‘just as wise or stupid, honest or false, as they are’.104 Conservatives certainly had little faith in the superior wisdom of a collective entity or in the competence of civil servants to direct large-scale businesses with either efficiency or enterprise. Even the relatively moderate proposals of the Beveridge Report had potentially corrosive implications, for ‘provision by the state of complete Social Security can only be achieved at the expense of personal freedom and by sacrificing the right of an individual to choose what life he wishes to lead and what occupation he should follow’.105 Anthony Eden’s declaration of 1946, that ‘the fundamental political problem that faces us is that of the relation of the individual to the State’, summed up not only the position in the wake of Labour’s landslide election victory, but also a central dilemma for Conservatives from the social reforms of the Edwardian Liberal governments to the attempt of Thatcherism to roll back the state in the 1980s.106 The difficulty did not lie in the basic principle, as Conservatives throughout these decades and since would have endorsed Timothy Raison’s definition in  1964: ‘that the natural state of the individual should always be regarded as freedom, and that there should be very good positive reasons for depriving him of any of the freedom’.107 The tensions, disagreements, dissatisfactions and defeats resulted from pragmatic decisions about how best to shield and encourage freedom, and what restraints should be placed upon it, or might be accepted as the price for some worthwhile objective elsewhere. Opinions on how best to deal with immediate issues, and what balance to strike between prudence and progress, were the stuff of daily conflict both within the governing parties and between them. Conservatives were particularly concerned about the dangers and costs of bureaucracy, with its self-fulfilling tendency to expansion. Against this, free Cecil, Conservatism, 189–90. Speech at Oxford, 8 January 1945, A Time For Wisdom, National Union leaflet 45/4 (1945). 104 Alport, About Conservative Principles, 13. 105 Post-War Problems Central Ctte., report of ctte. on the Beveridge Report, 19 January 1943, CPA, CRD/2/28/6. 106 Speech at Hull, 7 March 1946, in Conservative Political Centre, The New Conservatism: An Anthology of Post-War Thought (1955), 71. 107 Raison, Why Conservative?, 85. 102 103

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enterprise capitalism had proven its merits during the previous century: it had raised living standards, it provided opportunity and yet was also responsive to public demands, it was more open, and it required comparatively little by way of regulation and official supervision.108 On the grounds of its proven historical effectiveness and of its superior facility to develop individual character, ‘private initiative’ was widely held to be ‘an article of Conservative faith’.109 By the end of the 1960s, mainstream Conservatives had no hesitation in defining ‘the purpose of politics’ as the creation of ‘a freer society with a wider diffusion of power, responsibility and ownership’, which would be ‘prosperous and progressive’ and have ‘colour and variety’.110

Conclusion For most Conservatives, at least until the early 1960s, the classic definition set out in Disraeli’s speech at the Crystal Palace in 1872 remained the essential summary of their objectives: the maintenance of the constitution, the preservation of the empire and the improvement of the condition of the people.111 The second part of the triptych dwindled in relevance as the process of decolonization accelerated in the late 1950s, but the underlying ambition remained – the preservation of Britain’s place and importance in the world, albeit by different means and forms.112 The general definitions offered by twentieth-century Conservatives did not intend to supplant this, but rather tended to emphasize the human and moral basis of Conservatism. Thus, in the middle of this period, Alexander ErskineHill, Chairman of the ‘1922 Committee’ of backbench MPs, summarized his priorities as ‘the importance of the family as the unit in the state, the security of the country, honesty in public life, and loyalty to our friends’.113 In Keith Feiling’s dialogue on Conservatism, published in 1913, the character who spoke as ‘a Tory on principle’ defined its ‘main objects’ as ‘order before wealth, the balanced life before uniformity, self-sufficiency before dependence’.114 The Progress Under Capitalism, National Union leaflet  3478 (1935); Crisp, Rebirth of Conservatism, 44–7. 109 Wessex Provincial Area, Executive Ctte., 24 February 1943, CPA, ARE/10/1/3. 110 Rippon, Right Angle, 14. 111 W. Smithers, Conservative Principles (Sidcup, 1933), 1–2; R. V. Jenner, Will Conservatism Survive? (1944), 5; Goldman, Some Principles of Conservatism, 24. 112 Raison, Why Conservative?, 45. 113 Edinburgh North Conservative Association, Annual General Meeting, 17 April 1942, Edinburgh City Archives, Acc.198/11. 114 Feiling, Toryism, vi, 98. 108

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second and third of those values held true to the end of the century, with renewed emphasis on the latter under Mrs Thatcher; the first encapsulated some tension, in that the Conservative Party sometimes placed more emphasis upon order and sometimes more upon wealth creation. Nevertheless, nearly all Conservatives at the end of this period would have recognized this definition as valid, which indicates the degree of continuity in the party’s fundamental orientation, outlook and objectives, despite very considerable political, economic and social changes. The latter had produced some evolution: by the end of this period, there was less emphasis upon the role of religion, as its part in national life diminished, and more concern about the role of the state, as its part in national life became more evident. During and following the experience of the interwar depression, some Conservative politicians (initially those on the left, such as Harold Macmillan, but later spreading to the centre-left mainstream, such as R. A. Butler) were attracted to the idea of ‘planning’, which enjoyed some vogue between the mid-1930s and the failure of the Labour government’s ‘National Plan’ in the mid-1960s.115 However, this had clear limits: it was primarily concerned with economics, an area where it seemed there might be predictable processes of cause and effect that were within human comprehension and control, especially following the full development of Keynes’s theories of demand management, offering the possibility of escaping the cycle of boom and recession. It also proved to be a passing phase, as the hoped-for economic benefits failed to materialize, and thus against a depressing background of national decline and fears of a bloated but ineffective state, even of ‘ungovernability’, Conservative opinion moved from the early 1970s in the direction of reducing the size of the state and its roles in economic management and regulation; this was the tenor of the 1970 manifesto and of the policy declarations in the early part of Margaret Thatcher’s leadership, before the term ‘Thatcherism’ entered public consciousness.116 Twice during this period, there were reappraisals of the Conservative position which presented themselves as ‘the New Conservatism’. Both were responses to electoral defeat and the substantial advance of the Labour Party: the first, under Baldwin in  1923–24, followed the withdrawal from the Lloyd George Coalition and the 1923 election defeat; the second was in the wake of the Labour landslide of 1945. In both cases, re-examination did not find the basic principles of Conservatism to be wanting, and it was rather the case that they needed to be 115

116

H. Macmillan, The Middle Way (1938); Sir E. Boyle, Conservatives and Economic Planning (1966), 12–15. The Right Approach; Conservative Central Office, The Right Approach to the Economy (1977).

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returned to and reinforced, with certain themes of greatest relevance to current conditions given more emphasis and placed in the foreground. There was, therefore, considerable continuity in the party’s interpretation of the world and of itself; policies were adapted, even abandoned, but principles were not. This was also the case with the third reappraisal, which falls just after the period discussed in this chapter, and which was a response to the problems of both Conservative and Labour governments since the early 1960s. The reorientation of 1976–83 did not specifically call itself ‘New Conservatism’, partly due to the attraction of the simpler label ‘Thatcherism’, but it was in some ways a more substantial shift of emphasis than its predecessors. Even so, it remained within the recognizable canon of Conservatism and retained more continuity with the Conservative principles discussed here than was often allowed, especially at the time. One aspect of fundamental Conservative attitudes which did not change during this period was the confidence shared by all levels in the party from top to bottom, and across its spectrum of opinion from right to left, that ‘the essential Conservative outlook’ was ‘the characteristic outlook of the ordinary Englishman of every class’.117 For this reason, during the Conservative Party’s long history, ‘the deep truths which it represents have been the source of its wide appeal and the spring of its continuing vitality’.118 The belief that it was ‘a party broad-based upon the Nation’s will’,119 substantiated by regular electoral victories with effective working majorities (something achieved by its opponents only twice in these 65 years, in 1945 and 1966), gave little incentive to modify or discard basic principles. During these decades, the continuity and consensus in Conservative principles gave the party considerable benefits in its cohesion, confidence and the coherence of its responses, whether in office or in opposition, so that it was ‘capable of continuous renewal’.120

L. S. Amery, The Conservative Future: An Outline of Policy (Rochester, 1945), 8. Alport, About Conservative Principles, 3. H. Bentinck, Tory Democracy (1918), 138. 120 Raison, Why Conservative?, 28. 117 118 119

2

The Conservative Dialectic of Margaret Thatcher’s First Term Kieron O’Hara

The ideology of conservatism, and the politics of the Conservative Party, should be carefully distinguished. The ideology is based on the idea that change is problematic; familiar patterns of behaviour, institutions and traditions encode much practical wisdom which evades rationalist expression, and so we break up the familiar at our peril.1 One can be conservative without necessarily joining the Conservative Party or even being on the right of politics (e.g. there are conservative arguments for preserving the National Health Service). Equally, although the Conservative Party is a natural and a traditional home for conservative thinking, it has also been the repository for radical rethinking of political and economic policy, from tariff reform to monetarism and free market liberalism. The Conservative Party is often, therefore, the point of contact between ideologues of different kinds in (sometimes) creative tension.2 Yet an influential narrative of recent Tory history is that economic liberals who imbibed ideas from Hayek, Friedman and others worked to establish them as Conservative Party policy against opposition from conservatives tainted by their acceptance, however reluctant, of some tenets of social democracy.3 The Thatcher government can fairly be credited with establishing free market liberalism as an important reference point for all serious British politicians,4 1 2

3

4

Kieron O’Hara, Conservatism, London: Reaktion Books (2011). There is a good list in Angus Maude, The Common Problem: A Policy for the Future, London: Constable & Co (1969), 257–8. A key moment being Keith Joseph’s ‘conversion’. See Andrew Denham and Mark Garnett, Keith Joseph, Chesham: Acumen (2001), 250–3. Some on the left have even described Thatcherism’s ‘ideological hegemony’, for example, Bob Jessop, Kevin Bonnett, Simon Bromley and Tom Ling, Thatcherism, Cambridge: Polity (1988).

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but this narrative focuses on the struggle within that government between the Thatcherites and their opponents within. In her first term, the dragon Thatcher vanquished these none-too-effective St Georges, picking them off or marginalizing them one by one, taking conservatism ‘off the political agenda’5 and giving herself free rein in her second and third terms. This narrative is based on two assumptions which I will challenge: first, that conservatives must have been opposed to the Thatcher government’s programme during its first term; second, that, although Thatcher’s radicalism took a while to be cranked up, it was fully in control by the second term. Against these assumptions, I will try to establish that (a) although there was certainly a conservative challenge, there was little in that first term that was intrinsically opposed to conservative thinking properly understood, and (b) a conservative who was happy with the rough direction of travel in 1979–83 could also have found common ground in the second term, 1983–87. The pivotal moment where the conservatives lost their influence in the Conservative Party was not 1975 or 1979, but rather some time round about 1986.

Conservatism In this section, I will briefly set out a definition of conservatism based on the simplest association of ideas: conservatism should surely be about change.6 Another key concept is uncertainty; the conservative challenges the epistemological ground on which rationalist ideologues stand. The first principle upon which conservatism is based is, therefore, the knowledge principle: Because society and its mediating institutions are highly complex and dynamic with natures that are constantly evolving as they are co-constituted with the individuals who are their members, both data and theories about society are highly uncertain.7

5

6

7

For an example of this narrative, John Gray, ‘The undoing of conservatism’, in Enlightenment’s Wake: Politics and Culture at the Close of the Modern Age, London: Routledge (1993), 87–119. Another example is Simon Jenkins, Thatcher & Sons: A Revolution in Three Acts, London: Penguin (2007). Based on O’Hara, Conservatism, and After Blair: Conservatism Beyond Thatcher, Thriplow: Icon Books (2005). In this chapter, as elsewhere, I use ‘conservative’ with a small c to refer to those persuaded by the ideology of conservatism, and ‘Conservative’ with a big C to refer to the British political party. Not all conservatives are Conservatives, and not all Conservatives are conservatives. O’Hara, Conservatism, 49–51.

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That in itself says nothing about change, but if we consider how change during uncertainty entails risk, we get the second half of the definition, the change principle: Because the effects of social innovations cannot be known in advance, social change (a) must always risk destroying beneficial institutions and norms, and (b) cannot be guaranteed to achieve the aims for which it was implemented. It therefore follows that societies should be risk-averse with respect to social change, and the burden of proof placed on the innovator, not his or her opponents.8

Note that this is not a philosophy that condemns change; a sensible reading of the two principles shows that they merely shift the burden of argument to the innovator. Change is more desirable when the state of society is less satisfactory, so that the risk of change is relatively small. Switching from the language of opposition to change to the discourse of risk is vital for conservatism’s modernday relevance.

Liberalism and conservatism: A marriage made in heaven? Liberalism and conservatism have things in common – especially their enmity to socialism. Yet they should not be conflated.9 Small-c conservatism stresses continuity and casts a critical eye over social change, while the liberal, whose ultimate value is freedom, is concerned that behaviour is only limited by agreed institutional methods and that people are protected from the adverse effects of others’ actions. Each ideology opposes the use of the state to pursue equality or the interests of the working class, but the two will come into conflict if freedom leads to risky change. Free markets appeal to conservatives and liberals alike. Adam Smith argued that markets would only work to the benefit of society if they rested on a solid social underpinning, including respect for contracts and the rule of law. His conservative argument for free markets was that they promoted good habits among the citizenry of trust, thrift and concern for others.10 Some Conservative   8

  9

10

O’Hara, Conservatism, 88–9. I show how the conjunction of these two principles entails several wellknown conservative themes in Conservatism, 91–161. O’Hara, Conservatism, 211–34, O’Hara, After Blair, 171–206, F. A. Hayek, The Constitution of Liberty, London: Routledge and Kegan Paul (1960), 395–411, Gray, ‘The undoing of conservatism’. O’Hara, Conservatism, 221–4.

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Party politicians, Enoch Powell in particular,11 have argued that free markets allow change in accord with the general development of those societies and that therefore in practise conservatism and liberalism are not only compatible but also two halves of the same coin. This conservative rationale for markets is a separate argument from Hayek’s claim that they distribute resources and allocate capital most efficiently. The conservative argument is only partially tolerant of free markets; if it appears that markets are promoting greed and selfishness (as with the irresponsible risktaking by the banks prior to the 2008 crash), or even corruption or rent-seeking (as with Russian crony capitalism), to the detriment of society as a whole, then the conservative will prefer to regulate or supplement market mechanisms. There is no doubting the appeal of Hayekian ideas to the Conservative Party at the close of World War II. The Road to Serfdom made an epistemological argument against welfarism and government interference in the economy.12 Governments cannot know enough to make sensible plans; the knowledge to do that is distributed across individual consumers in the economy, and the price signal in a competitive bidding market is the best heuristic guide to that distributed knowledge.13 Hayek’s work sustained the Conservatives in three ways. First of all, after 1945 his can-do was attractive to a defeated party. Second, the adoption of Hayekian ideas helped define a political direction for a new generation, signalling a break with an older class of patrician Tories which was palpably out of touch. Third, the popularity of the Beveridge Report and the scale of the 1945 defeat showed that the Conservatives had lost the argument about the future direction of the economy. Collectivism, nationalization and redistribution were in, whether the Tories liked them or not. They did not like them,14 but felt condemned to acquiesce; their immediate future depended on their being able to work within this new paradigm15 (and of course the 1951–64 government found quite a niche for itself in administering these essentially paternalist ideas in a friendlier way than Labour’s puritans). Hayek provided the Conservatives with a ready-made critique of the new order, and many in the party (not only on the right) spent 11

12 13 14 15

J. Enoch Powell, ‘Theory and Practice’, in G. M. K. Hunt (ed.), Philosophy and Politics, Cambridge: Cambridge University Press (1990), 1–9. F. A. Hayek, The Road to Serfdom, London: Routledge, 1944. F. A. Hayek, ‘The use of knowledge in society’, American Economic Review, 35 (1945), 519–30. E. H. H. Green, Ideologies of Conservatism, Oxford: Oxford University Press (2002), 218–21. Some did. Cf. for example, Mark Garnett and Ian Aitken, Splendid! Splendid! The Authorized Biography of Willie Whitelaw, London: Jonathan Cape (2002), 38.

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much of the post-war period hoping for an opportunity to bring Hayekian ideas to the forefront of Tory thought and policy. The other component of post-war Tory liberalism was monetarism, developed by Milton Friedman and others to explain changes in the value of money (inflation and deflation) in terms of the quantity of money available within an economy. Too much money would mean an increase in spending, followed by increasing prices. As then-Chancellor Peter Thorneycroft argued in a memorandum to Cabinet in  1957, ‘the continual increases in prices and wages rests in the last resort on the belief that the Government will always make enough money available to support full and indeed over-full employment’.16 Thorneycroft, Powell and Nigel Birch developed a proto-monetarist view as Macmillan’s Treasury team and famously resigned in  1957 when it failed to convince the Cabinet.17 Monetarism’s moment did not come in the late 1950s, but it increasingly came into its own as the prevailing Keynesian orthodoxy failed to explain (or address) simultaneously high inflation and unemployment following the collapse of Bretton Woods and the oil shocks of 1973. There was clearly an opportunity for both Hayekian libertarianism and Friedmanite monetarism if only a leading politician could craft an appealing enough message to voters. The awards of Nobel Memorial Prizes for Economic Sciences to Hayek in 1974 and Friedman in 1976 also helped legitimize their views. Thatcher is credited with bringing Hayekian and monetarist ideas into British government for the first time, yet in many ways she was pushing against an open door.18 In particular, there had been two earlier attempts to promote the free market in such a way as to be acceptable to the Conservative Party. The first of these early attempts has been termed ‘Powellism’, a mixture of populism, conservatism and liberalism crafted by Enoch Powell in a series of speeches and books through the 1960s and 1970s. Secondly, Edward Heath had hopes of moving the United Kingdom in the direction of free markets. The ideas developed at the Selsdon Park Hotel in 1970 for tax cuts, selectivity in social services and a tougher approach to law and order were hardly the Neanderthal philosophy that Wilson represented them as, but ‘Selsdon Man’ had some Hayekian and Friedmanian genes. 16 17

18

Quoted in Green, Ideologies of Conservatism, 200. As did Whitelaw, Thorneycroft’s PPS, very reluctantly. Garnett and Aitken, Splendid! Splendid! 50–1. Green, Ideologies of Conservatism, 214–39.

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For all that, Heath was hardly an ideologue, and free markets were favoured because of their supposed technocratic efficiency. When certain industrial sectors struggled in the cold economic climate of the early 1970s, Heath’s reaction was to try to save ailing companies and pump money into the economy.19 This was a clear U-turn as it has been portrayed, but is evidence less of Heath’s treachery than his pragmatism. His faith in free markets was ‘superficial’ and contingent on their success in delivering growth and jobs; their failure to do that was enough to disillusion him.20 He parted company with Selsdon Man, though he had little to replace him with than the increasingly reviled consensus. Yet neither Hayek’s nor Friedman’s ideas could be wholeheartedly accepted by conservatives. Hayek himself criticized conservatism, and he embraced the possibility of radical social change and uncertainty. Furthermore, his attacks on welfare states and the concept of social justice risked, from a conservative point of view, stoking social unrest and undermining stability. Meanwhile, Friedman’s k-percent rule was specifically designed to remove central bankers’ discretion from monetary policy, allowing the money supply to be calculated by an algorithm based on known macroeconomic factors. Monetarism’s faith in theory breached the conservative knowledge principle, for instance prompting George H. W. Bush to christen it ‘voodoo economics’ during the 1980 Republican primary in the United States. For all these reasons, the practicality of free market policies in the 1970s was seriously doubted; as Andrew Gamble wrote (without the benefit of hindsight), ‘it will be surprising if, in the end, the new [Thatcher] administration does not become another. . . Tory government which will disappoint many of the hopes that have been raised’.21 The conservative/liberal distinction is not the same as a left/right distinction. A right-wing conservative could easily disparage economic liberalism. For instance, Angus Maude, hardly a pinko, was suspicious of any idea that the purpose of government was to produce growth and consumption22 or employment.23 Maude’s argument applied equally to those conservatives who made the greatest accommodations to ‘the post-war consensus’ (‘it is not easy, in retrospect, to identify the Macmillan administrations with any ideas of a markedly spiritual kind; material comfort and the quick speculative profit seem to have been more 19 20 21

22 23

John Campbell, Edward Heath: A Biography, London: Jonathan Cape (1993), 436–56. Campbell, Edward Heath, 267. Andrew Gamble, ‘Economic policy’, in Zig Layton-Henry (ed.), Conservative Party Politics, London: Macmillan (1980), 26–49, at 47. Maude, The Common Problem, 37, 112, 214–18, 236–7. Maude, The Common Problem, 207.

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characteristic of the social atmosphere they produced’),24 and to free market liberals.25 A similar sort of position can occasionally be found today.26 I shall argue that broadly speaking, although liberals had many reasons to be satisfied with Thatcher’s performance from day 1 of her administration, conservatives too had cause to cheer her first term of office. Only in her second term did the pursuit of radical and doctrinaire improvements to systems that were not in crisis betoken a government with little or no concern for the traditional conservative virtues of stability, consensus, authority, plurality of value and inclusion.

The conservative critique of Thatcher Margaret Thatcher was elected leader in  1975 not only because she was not Edward Heath, but also because she was the candidate of the right.27 Her first term became notorious for an ongoing battle between her own loyalists and a more experienced group of patrician conservatives who became known as the ‘wets’, from their supposedly soggy approach to political struggle. The wets most often cited as developing a critique of Thatcher were a group of four, in order of elimination: Norman St John Stevas, Sir Ian Gilmour, Francis Pym and James Prior.28 Other wets unimpressed with Thatcher’s leadership, such as Mark Carlisle and Christopher Soames, made less of a splash. No wet had a key economic portfolio, and none lasted the course. The first three were sacked, while Prior resigned in frustration at his marginalization. These four were certainly not the only people on the left of the party who sat in Thatcher’s Cabinet (others included Peter Walker and Willie Whitelaw), but if we discount the special case of Michael Heseltine, they were the most hostile. The wet critique had a number of droplets,29 but it boiled down to suspicion of the spurious precision of monetarism (the knowledge principle), combined with a worry that Thatcher’s policies, driven forward without regard to their 24 25 26 27

28 29

Maude, The Common Problem, 51. Maude, The Common Problem, 197–202, 290–3. For example, in Jenkins, Thatcher & Sons. John Ramsden, An Appetite for Power: A History of the Conservative Party Since 1830, London: HarperCollins (1998), 420–1, Green, Ideologies of Conservatism, 215. Cf. for example, Hugo Young, One Of Us, 2nd edn, London: Macmillan (1991), 198–201. Ian Gilmour, Dancing With Dogma: Britain Under Thatcherism, London: Simon & Schuster (1992) is the classic statement, and for the wets’ view specifically of the first term without hindsight, see Francis Pym, The Politics of Consent, London: Hamish Hamilton (1984).

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immediate effects, would undermine social stability and raise national and international tensions (the change principle). Hence, in its combination of the two principles it was a genuinely conservative critique. Areas of particular worry included Thatcher’s bellicose attitude towards the Soviet Union, monetarist economics, the rejection of traditional policy tools such as incomes policy and exchange controls, public spending cuts, the policy focus on inflation at the expense of unemployment, Thatcher’s aggressive attitude towards the European Economic Community, her refusal to compromise with the trade unions, her uncollegial governing style and her strident tone. It was an unashamedly conservative attempt to assert a moderate and responsive philosophy for the Conservative Party. The wets were of the opinion that Thatcher and Joseph were outliers or entryists who gained the crown in 1975 only thanks to Heath’s stubborn failure to recognize that his position was untenable. The rank and file remained supportive of Heath to the end.30 On this analysis, Thatcher and Joseph lacked deep support and would not be able to resist the voice of reason; the silent majority in the Conservative Party would be worried by poor opinion polls and high unemployment and would force the leadership to change back to something more recognizable. The pragmatic element of the critique hinged on the likelihood of electoral annihilation as a socially tolerant and compassionate population turned on the hard-hearted Gradgrinds of the new right.31 Yet in the end, Thatcher was triumphant. The economic position improved somewhat. The Falklands episode was an advertisement for the virtues of conviction (even though the invasion wouldn’t have happened without the 1981 defence review, and so might equally have been taken as an advertisement for the evils of cutting) – it was hard to imagine any other recent Prime Minister conducting the war with quite so much gusto. Most importantly for Thatcher, the opposition was divided and pathetically out of touch with voters. By the 1983 election, Francis Pym was reduced to hoping that the government of which he was a part would not win too big a majority (in the end, its majority was 144, despite polling 700,000 fewer votes than 1979). 30

31

Ramsden, An Appetite for Power, 423, Campbell, Edward Heath, 671, Andrew Denham and Kieron O’Hara, Democratising Conservative Leadership Selection: From Grey Suits to Grass Roots, Manchester: Manchester University Press (2008), 22. For long periods, Thatcher’s ratings were poor, and in December 1981 she was as unpopular as any Prime Minister since polling began (Young, One Of Us, 242). For a review of attitudes to Thatcher, see Ivor Crewe, ‘1979–96’, in Anthony Seldon (ed.), How Tory Governments Fall: The Tory Party in Power Since 1783, London: Fontana (1996), 393–451, at 401–14.

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The hazard of the dry: Differing rationales for resisting the wets’ conservative critique The failure of the wets to carry the day in 1979–83 was patently obvious. Their arguments resonated largely with the Conservatives’ opponents. They resisted the temptation to strike at Thatcher in her many weak periods,32 leading to criticism from the likes of Hugo Young,33 but there is little evidence that the wets ever influenced the groups who could have brought genuine pressure to bear on Thatcher. This conservative critique of Thatcherism was resisted even before she had become the icon of the 1980s, and when the economic signs, particularly unemployment, were almost wholly negative. In which case, it is worth asking why. In this section, I will explore some possible ideologically based reasons for resisting the wets’ critique. I do not claim that this is an exhaustive list (there will be non-ideological reasons, including pusillanimity, cowardice in the face of Thatcher’s handbag and the need for the personally ambitious to remain in the Prime Minister’s good books). My aim is to argue that the wets did not have a monopoly of conservative wisdom and that Thatcher’s first term had a narrative that was not only consistent with conservative ideology but also recognizably conservative. The picture of Thatcher’s first term as a radical departure from traditional Tory philosophy is too simplistic a view. First, for monetarists, it was a cardinal error to lose nerve at predictable events such as increases in unemployment, social unrest and government unpopularity. Such error resulted from the type of compassion that causes more suffering in the long run, by preventing the cure from working. If monetarism were resisted, then the economic situation would worsen, and even stricter measures would have to be brought in later on. The spectacle of the previous government’s forced implementation of monetarist policies as a condition for a loan from the IMF lent credence to this view. Furthermore, on a strict monetarist view, the 1979–83 government had already made enough concessions to ‘outdated’ economic ideas. A second reason for rejecting the wets’ critique was based on recent Tory history. Given the horrendous experiences of 1972–74, the basic discipline of sticking to one’s principles seemed relatively attractive.34 Conviction often seems 32 33 34

Gilmour, Dancing With Dogma, 30–9. Young, One Of Us, 204–5. Young, One Of Us, 212.

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suicidal, but the 1979–83 government had the distinct and rare advantage of a recent object lesson from the Heath government that lack of conviction can be equally damaging. Conviction politics also wrongfooted the Labour opposition who were convinced that Thatcher would have to change course.35 She also benefited from another lesson from Heath; in opposition, he carried out detailed policy reviews to present the Conservatives as an alternative government. Failure to implement some of these policies influenced her preference for a broad-brush strategy in her own period of opposition.36 However, one did not have to be anti-conservative to oppose the wets. Their critique was genuinely small-c conservative, yet it is important to realize that this was not the only possible conservative position, and they were not the only conservatives around. The 1979 Cabinet has been called ‘Whitelaw’s Cabinet’37 and contained conservative figures who did not (at least regularly or publicly) attempt to undermine Thatcher, including Whitelaw himself (who had opposed Thatcher in the leadership contest of 1975, advocating ‘the disposition to preserve’ and, prefiguring Bush, worrying about those monetarists who were ‘overawed by voluble expertise’),38 Lord Carrington and Lord Hailsham. It may be no coincidence that these three in particular had served as Conservative Party chairmen and had a strong sense of the rich seam of opinion in the party into which Thatcher and Joseph had tapped. Furthermore, others, such as Michael Heseltine and Peter Walker, were prepared to remain within the tent despite having difficulties at a number of points. Recall that conservatism is a statement about risk. The conservative cannot rule out change. As Burke pointed out, ‘to make us love our country, our country ought to be lovely’.39 This gives a reason for conservatives to embrace change: if our country is not lovely, then change would be welcome. In other words, if an innovator can show that the current situation is bad enough, then the risks of unintended consequences of his or her policies are outweighed by the likelihood of improvement of the problem at hand. Social strife, economic problems and polarized politics imply that the risks of change may be worth undertaking.40

35 36

37 38 39 40

Young, One Of Us, 193. Martin Burch, ‘Approaches to leadership in opposition: Edward Heath and Margaret Thatcher’, in Zig Layton-Henry (ed.), Conservative Party Politics, London: Macmillan (1980), 159–85, at 180, Ramsden, An Appetite for Power, 427. Garnett and Aitken, Splendid! Splendid! 241. Garnett and Aitken, Splendid! Splendid! 210. Edmund Burke, Reflections on the Revolution in France, Harmondsworth: Penguin (1968), 172. O’Hara, Conservatism, 97–100.

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Hence, a conservative could have supported Thatcher in her first term if he or she was convinced that the state of Britain at the time was such as to counterbalance the risk of change. Trying to govern with the unions’ cooperation was no longer tenable. Wets were worried about Thatcher’s strident tone in foreign policy,41 but even so, there was much that a conservative could admire. The Soviet invasion of Afghanistan in December 1979 legitimized her anti-Soviet rhetoric. The absurdity of the Common Agricultural Policy and Britain’s weak economic position legitimized the budget rebate she campaigned for so aggressively (and successfully, rejecting an offer of £350m, and ultimately achieving a rebate of £1.8 billion).42 On Rhodesia, Thatcher had anyway shown remarkable sensitivity, and her hawkish reputation undoubtedly made for a convincing negotiating position.43 In short, a conservative could easily look at Thatcher’s agenda for 1979–83, then look at the depressing and dire headlines in the newspapers, and feel that Britain was indeed no longer ‘lovely’ and that the ‘means of some change’ were due. This helps explain what otherwise might seem mysterious, why some conservatives prospered in  1979–83 and others didn’t. Not all conservatives were wets.44 It was arguable that Britain had reached the point where the risk of stasis outweighed the risks of change. Its problems had taken a quantum leap in the wrong direction, because the dominant Keynesian economic paradigm was failing. Rising unemployment and high inflation were not supposed to be possible simultaneously. From the conservative point of view, Keynesianism and monetarism were equally theoretical and therefore equally misguided at the limit. A conservative might be quite happy to go along with Keynesianism but only as long as it was delivering the economic goods. The economic difficulties of the 1970s were bad not only in their own right, but also because they weren’t supposed to happen, and the prevailing theory gave no advise. It was perfectly conservative to switch from a lukewarm allegiance to Keynesianism to an equally unenthusiastic attachment to monetarism in such circumstances. Two policy documents, The Right Approach (1976) and The Right Approach to the Economy (1977), co-authored variously by Joseph, Howe, Maude, Whitelaw, David Howell, Chris Patten and Prior, cemented a rapprochement between conservatives and 41 42 43 44

For example, Pym, The Politics of Consent, 56–62. Bizarrely, Young, One Of Us, 382–9 portrays this negatively. John Campbell, Margaret Thatcher Volume Two: The Iron Lady, London: Jonathan Cape (2003), 72. Contra Ramsden, An Appetite for Power, 439–41 and Gilmour, Dancing With Dogma, 34–5.

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monetarists in opposition45 – but only Prior broke ranks when the theories of opposition encountered the realities of government. Certainly, many commentators viewed the 1970s as an unusually bad time,46 and a number of conservative Tory politicians, including Hailsham, Whitelaw, Alec Home47 and Macmillan,48 had shifted in a pessimistic direction immediately prior to the 1979 election. John Charmley has argued that ‘Mrs Thatcher’s harder line was more acceptable [in 1979] than it would have been a year before’.49 Many in the cabinet, including those on the left of the party, were daunted by the task ahead and impressed with the scale of Thatcher’s and Howe’s ambitions50; even Prior told a journalist in September 1979 that ‘nothing else has worked in the past, so we must try it our way’.51 Some had even argued that things were so bad that a coalition government was needed to steer Britain through the national emergency – especially after the successful performance of the cross-party Britain in Europe group in the 1975 referendum.52 Yet coalition was not practical in the tribal politics of the day – although the fact that some in the centre considered it is indicative of the dire straits of Britain at the time. The governments of 1964–79 had failed, and the wets had no better suggestion than more of the same.

Examination of the evidence E. H. H. Green writes of late-1950s’ Tory politics that From the protests of the [Middle Class  Alliance] and [the People’s League for the Defence of Freedom], and from party conference debates and constituency reports, it is possible to distil four main interrelated grievances behind the ‘middle class revolt’. First, inflation. Second, the growing power and abuses of trade unions . . . . Third, the level of taxation required to fund an ‘over-generous’ Welfare State

45 46

47 48 49 50 51 52

Ramsden, An Appetite for Power, 434. Cf. for example, Ramsden, An Appetite for Power, 421–2, Dominic Sandbrook, State of Emergency: The Way We Were: Britain, 1970–1974, London: Allen Lane (2010), Sandbrook, Seasons in the Sun: The Battle For Britain, 1974–1979, London: Allen Lane (2012), Mark Garnett, From Anger to Apathy: The British Experience Since 1975, London: Jonathan Cape (2007), esp. 18–71. Garnett and Aitken, Splendid! Splendid! 236. Alistair Horne, Macmillan 1957–1986, London: Macmillan (1989), 616. John Charmley, A History of Conservative Politics 1900–1996, Basingstoke: Macmillan (1997), 207. Young, One Of Us, 153. Young, One Of Us, 167. Kieron O’Hara, The Referendum Roundabout, Exeter: Imprint Academic (2006), 73–83.

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and inefficient nationalized industries. Fourth, and perhaps most important, the apparent inability or unwillingness of the Conservative party to adopt ‘real’ Conservative policies . . . .53

These pressure groups pushed ‘liberal market demands’,54 but we should distinguish between their positive policies and the grievances which gave them ‘legs’. The middle class revolt of the 1950s encapsulates the things that appear to threaten the careful, structured existences of the reasonably well-to-do in a stable nation. Of these four grievances, only the fourth was notably ideological, and even that, on Green’s account, was based on irritation that socialist nostrums went unchallenged.55 As it is, the four grievances apply just as easily to the 1970s as irritations for conservatives. Furthermore, after 1964, there was little support in the Tory Party for the pragmatic argument that consensus politics was an election-winner. Thatcher addressed these grievances. There is little doubt that her instincts were not very conservative. In 1981, she described her political goal in almost Marxist terms: ‘Economics are the method; the object is to change the soul’.56 Yet she did not always push through policies which she favoured.57 Conservative Party policies could, therefore, at least sometimes be matters for agreement between conservatives and liberals. In the first term, Whitelaw in particular played an important role by using his influence selectively to moderate some of the more doctrinaire aspects of the first term.58 The reshuffle of September 1981 deliberately changed the balance with the demotion of Prior and the removal of Gilmour, and promotion for three key Thatcherites, Norman Tebbit, Cecil Parkinson and Nigel Lawson (Whitelaw had worked to keep Lawson away from an economic post59). However, those conservatives who preferred to work with the Prime Minister were effective in pursuing their own agenda. The response to the 1981 riots is indicative of the creative tensions and the scope for compromise. Whitelaw managed to ensure that the inevitable inquiry was chaired by the liberal-minded Lord Scarman, while Heseltine initiated a 53 54 55

56 57 58 59

Green, Ideologies of Conservatism, 224, and cf. Young, One Of Us, 604. Green, Ideologies of Conservatism, 223. It should also be pointed out that it was a grievance shared with wet Francis Pym. The Politics of Consent, 11. Quoted in Garnett, From Anger to Apathy, 234. Peter Hennessy, Cabinet, Oxford: Basil Blackwell (1986), 111; Young, One Of Us, 339–40. Garnett and Aitken, Splendid! Splendid! 4–5. Young, One Of Us, 333–4, Campbell, Margaret Thatcher, 106.

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highly interventionist strategy in Liverpool after riots in Toxteth. His minute It Took A Riot argued for the pursuit of social justice,60 against some in cabinet, including Howe, who argued that limited resources meant that ‘the option of managed decline is one which we should not forget altogether’.61 Heseltine partly got his way and was able to spearhead a drive for Liverpool’s recovery – yet without a correspondingly large commitment of resources. The cabinet dynamics (Heseltine was perceived as being too big a beast to risk his resignation) helped the issue to be resolved after the clear differences between the factions had been aired; the final scale of Heseltine’s programme was determined by an ad hoc group stacked with opponents, while Whitelaw worked to find a compromise.62 Thatcher’s own law-and-order instincts were to the fore, and while most political discussion focused on what to do about the malefactors, her immediate sympathies were with the (probably small-c conservative) shopkeepers.63 She later damned Heseltine’s efforts with very faint praise.64 The Thatcher government also stuck to some promises that it no doubt regretted, most notably respecting the recommendations of the Clegg Commission on public sector pay. The Commission was abolished in 1980, but the pay rises it had already recommended were eye-watering for any government, especially one looking for expenditure cuts. As inflation and unemployment both rose, and with them social security spending (and the government was also committed to rises in spending on defence and the police), various targets for the Public Sector Borrowing Requirement were trimmed, but as Blake argues,65 these were tactical moves rather than strategic U-turns. The Conservatives’ first budget was certainly striking for its push towards freer markets, especially the abolition of exchange controls. But the main aim was a balanced budget. Although expenditure was cut, Chancellor Howe tried to substitute other revenue, raising VAT to 15 per cent, a textbook application of the principle that taxation of consumption is less distorting of economic activity than taxation of income. In the short term, inflation rocketed, especially after the oil shock following the Iranian revolution.

60 61

62

63 64 65

Michael Crick, Michael Heseltine: A Biography, London: Penguin (1997), 227. ‘Toxteth riots: Howe proposed “managed decline” for city’, http://www.bbc.co.uk/news/uk-englandmerseyside-16355281 (2011). Hennessy, Cabinet, 102, Campbell, Margaret Thatcher, 116–17, Garnett and Aitken, Splendid! Splendid! 263–5. Young, One Of Us, 239, Campbell, Margaret Thatcher, 114. Margaret Thatcher, The Downing Street Years 1979–1990, London: HarperCollins (1993), 424. Robert Blake, The Conservative Party From Peel to Thatcher, London: Fontana (1985), 343.

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One important theme of conservatism is the unpredictability and uncontrollability of events and the unintended consequences of action, and so a conservative would agree with the Thatcher government’s insistence that its powers were limited. As the Treasury’s Red Book for the 1980 budget argued: The Government has deliberately not set its targets in terms of the ultimate objectives of price stability and high output and employment because these are not within its direct control. It has instead set a target for the growth of the money supply which is more directly under its influence and has stated that it will frame its policies for taxation and public expenditure to secure a deceleration of money supply without excessive reliance on interest rates.66

The Medium Term Financial Strategy ‘formally abandoned the pretence that full employment and economic growth were in the gift of the government, accepting by implication that the achievement of these desirable objectives depended on the ability of British commerce to meet the appetites of its customers at home and abroad’.67 The relative powerlessness of government is a conservative nostrum; the only thing that a conservative would disagree with in the Treasury’s statement is the assumption that the money supply was easier to control. In the end, that assumption was shown to be false by the new government’s failure to control the supply of money (commonly measured by £M3),68 implicitly acknowledged in 1985 when it was dropped as a target.69 Thatcher herself had never been one of the main enthusiasts and rarely mentioned it70; Lawson called monetary control a ‘black art’.71 In the Autumn of 1980, expenditure hawks lost some battles in cabinet72; Howe responded by raising taxation in 1981. There were many voices against the deflationary budget, including a famous letter to the Times from 364 economists insisting that it would deepen the depression, have no effect on inflation and lead to political instability and long-term unemployment. They were correct on the final point, but the recession hit bottom shortly afterwards, and the letter became a standing joke on the right73; for Howe, the key factor of which they had 66 67

68

69 70 71 72 73

Quoted in Blake, The Conservative Party, 344. Jock Bruce-Gardyne, Mrs Thatcher’s First Administration: The Prophets Confounded, London: Macmillan (1984), 59. Campbell, Margaret Thatcher, 81, Nigel Lawson, The View From No.11: Memoirs of a Tory Radical, London: Transworld (1992), 447–8, contra Thatcher, The Downing Street Years, 96–7. Young, One Of Us, 503. Campbell, Margaret Thatcher, 88. Lawson, The View From No.11, 76. Thatcher, The Downing Street Years, 123–9. Lawson, The View From No.11, 97–8.

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not taken account was the credibility of the government’s anti-inflation policy.74 Their cause was not helped by the assertion that ‘there are alternative policies’ without explaining what they might be.75 The 1981 budget has always been seen (correctly) as a key Thatcherite moment,76 and Thatcher and Howe were reluctant to allow it to be discussed in cabinet.77 Yet it must also be admitted that a balanced budget – spending what one earns – is an important conservative desideratum.78 Debt increases exposure to risk.79 Failure to balance the budget or reduce borrowing leads to dependence on the goodwill of creditors. If you don’t want to be pushed around by the IMF (as the Callaghan government had been), don’t borrow from the IMF. At the time of writing, when sovereign default is a serious threat, the 1981 budget looks more courageous than heartless. Similarly, the fight against inflation is important, because sound money is a vital risk management tool,80 and so is a social, not an economic, problem. Joseph had prepared the ground, arguing in September 1974 that ‘inflation is threatening our society’ by devaluing thrift, hard work and saving.81 Whitelaw broadly trusted Howe’s judgment, although he wasn’t consulted in advance; in contrast, Gilmour, Walker and Prior considered, and rejected, the option of resignation.82 Unemployment was an important tool for the government.83 Once more it was viewed differently by liberals and conservatives; for the liberals, it was a necessary ‘fact of life’ as part of the adjustment towards an economy with sound fundamentals. Yet a conservative could also accept the high unemployment rate for more political reasons. It discouraged strikes, helped moderate wage demands and demonstrated the importance of competitiveness and the possibility of someone pricing himself out of a job. It moderated union behaviour despite the belief of many commentators that instability would inevitably follow from government policy. In an early brush with the unions, a steel strike in  1980 ended in Pyrrhic victory for the Iron and Steel Trades Confederation. After a 13-week stoppage, it 74 75 76 77 78 79 80 81 82 83

Young, One Of Us, 202–3. Cf. also Campbell, Margaret Thatcher, 111. Campbell, Margaret Thatcher, 104–13. Thatcher, The Downing Street Years, 138. See the quote from Thatcher in Campbell, Margaret Thatcher, 109. O’Hara, Conservatism, 151–7. O’Hara, Conservatism, 113–15. Green, Ideologies of Conservatism, 212, Denham and Garnett, Keith Joseph, 255–9. Garnett and Aitken, Splendid! Splendid! 269. Campbell, Margaret Thatcher, 93–4, Gilmour, Dancing With Dogma, 100, contra Gamble, ‘Economic policy’, 45, Maude, The Common Problem, 219.

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won a large pay settlement, despite British Steel losing £7m per week. Industry Secretary Joseph stood aloof from the negotiations with Thatcher’s support84; Prior’s gradualist approach to union reform survived the strains in cabinet, although Prior himself was perceived to have been weakened by the dispute.85 But the significant outcome was the accompanying productivity agreement which later allowed British Steel to shed tens of thousands of workers – whose underemployment had been compounded by the loss of orders caused by the strike itself. Prior’s Employment Act of 1980 chipped away some union powers, but his moderation was not representative of thinking across the party (although it was not unprecedented, being for example in the tradition of Iain Macleod, Macmillan’s Minster for Labour). It was still less in tune with his leader.86 Free marketeers do not like unions because they distort the market for labour – but conservatives have little love for them either. The unions were clearly part of the national problem, and hence even a conservative could be impatient with Prior – as were Heseltine and Walker who wished to end the monetarist experiment, but wanted tough constraints on the unions to keep inflation down.87 It is commonplace that Thatcher was a conviction politician.88 This actually helped small-c conservatism regain a sense of its principles; after the U-turns and corporatism of the 1960s and 1970s, conservatism had begun to be identified with timidity and appeasement. Sometimes the urge to avoid trouble appeared to outweigh anything else, even if indecisiveness stored up greater trouble for the future.89 Those conservatives who disagreed with Thatcher on detail could still admire her refusal to back down to antisocial forces and approve of prioritizing the fight against inflation.90 If industrial problems caused the party electoral or financial discomfort (manufacturing firms decreased their funding of the Conservative Party), then her principled stand was surely more admirable, not less.91 The Conservative Party is interested in power,92 but it was good to remind even moderates and centrists that this should not be at all costs. 84 85 86 87 88

89 90 91 92

Thatcher, The Downing Street Years, 111–12, Campbell, Margaret Thatcher, 98–9. Denham and Garnett, Keith Joseph, 347–9. Thatcher, The Downing Street Years, 104–5. Blake, The Conservative Party, 348. Some have argued that this is what enabled her to make a difference – for example, Charmley, A History of Conservative Politics, 210. This was the charge of Hayek, The Constitution of Liberty. Whitelaw, for example, took such a position. Garnett and Aitken, Splendid! Splendid! 235. Blake, The Conservative Party, 353. A. J. Davies, We, the Nation: The Conservative Party and the Pursuit of Power, London: Little, Brown (1995).

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Hence, although moderate David Howell complained that ‘there is some doubt . . . about whether these great absolutes . . . really need exist in quite the form it’s being constructed or whether the whole issue couldn’t be handled in a rather more sensitive and relaxed way’, he also accepted that ‘there is going to be a stage where issues cannot be resolved by analysis or delicate agreement and can only be resolved by crude political battering’.93 Lord Carrington argued that the Conservative Party ‘is never at its most attractive or most interesting or most useful when trying, out of character, to be ideological’94 and that Thatcher ‘exaggerated’ the efficacy of monetarist policy.95 Yet he put her successes down to her determination to conquer inflation, reward individual effort, reduce the power of the state and restore the function of the unions as representatives of their members – ‘in all this there is no doubt she had the mood of the country increasingly with her’.96 Carrington cast monetarism and liberalism as kinds of faith sometimes at odds with reality. Yet he summed up his acceptance of Thatcherism with a very conservative, if rueful, rationale. I believed that there was, in fact, probably no alternative. There were no easy ways out of the mess of financial indiscipline, lax management, over-mighty trades unions, overmanning and excessive state interference which disfigured too much of British industrial life . . . . Under the Conservatives other ways to salvation had in the past been tried and one had to admit, at least in the particular circumstances of Britain, they hadn’t worked.97

The Thatcher governments after 1983 The 1983 Conservative Party manifesto was a thin document,98 and some were disappointed with the lack of radicalism of the second term. In many ways, the 1983–87 government carried on the work of its predecessor, but as Thatcher gained in confidence and forced more of her ideas onto the agenda, there was less for conservatives to cheer,99 and by 1987, the unthinkable was so thinkable that 93 94 95 96 97 98 99

Quoted in Hennessy, Cabinet, 97. Lord Carrington, Reflect on Things Past, London: William Collins (1988), 255. Carrington, Reflect on Things Past, 275. Carrington, Reflect on Things Past, 275. Carrington, Reflect on Things Past, 309. Young, One Of Us, 329–30, Lawson, The View From No.11, 245. Cf. Charmley, A History of Conservative Politics, 219ff.

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even Lawson excoriated the 1987 manifesto ‘replete with policy initiatives that had not been properly thought through’.100 In this section, I will briefly consider one policy achievement which united liberals and conservatives (the miners’ strike), and one which helped drive a wedge between them (the Big Bang). The wets, though they may have been pleasantly surprised by the results of union legislation in the first term, were still wary about further legislation. For instance, Pym argued that ‘the time has come for success to be consolidated’ and that ‘it would be in line with the best Tory tradition for the Conservative Party to take the lead in helping the unions towards a new and more constructive role’.101 But those conservatives who supported Thatcher’s first-term measures had no particular reason to demand their cessation in the second term. The unions were still active; for example, in late 1983, a dispute between minor newspaper proprietor Eddy Shah and the National Graphical Association over the introduction of new technology led to mass picketing and violent protests. Mining was another likely target for the Conservative government, and not only for ideological reasons. Tribal party politics also played a part; it was the National Union of Mineworkers (NUM) which had brought down Heath’s government and forced Thatcher’s government to back down in 1981. There was also an economic problem, as British Coal was losing £1.5m per day in 1983. The Tories were prepared; coal stocks were high (thanks to a build-up following the government’s defeat in 1981), and in the spring demand was falling. Institutional changes had been put in place, including laws against secondary picketing and the National Reporting Centre, which could coordinate police action against flying pickets.102 Hence, it could plausibly be argued that the dispute with the miners was the endgame of a strategy undertaken during the first term. It was a backwardlooking, practical, tactical fight to pick that conservatives as well as neo-liberals could buy into.103 Not all the labour disputes of the Conservatives’ second term were regarded so insouciantly in Tory circles, however. In particular, the decision in early 1984 to ban unions from operating inside the Government Communications Headquarters (GCHQ) was less happy104 (a decision made by a small cabal rather Lawson, The View From No.11, 246. Pym, The Politics of Consent, 146–7. 102 For narratives of the strike, see Thatcher, The Downing Street Years, 339–78, Young, One Of Us, 367–78, Garnett, From Anger to Apathy, 107–13. 103 Young, One Of Us, 605. 104 Young, One Of Us, 354–8. 100 101

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than in full cabinet105). Furthermore, a number of policies in  1983–87 were designed to reduce the powers of other, more benign, competing institutions, including the Greater London Council (GLC) (whose abolition Whitelaw tried, and failed, to block),106 local government generally, the civil service, the universities and the Church of England.107 The reduction of alternative sources of value, and of checks and balances on government, was not likely to appeal to genuine conservatives.108 Whitelaw, now leader of the Lords, was seriously concerned at the volume of ill-thought-through legislation emanating from ministers seeking ‘to win favour with the Prime Minister by imitating her own revolutionary zeal’.109 But of all the major policy achievements of the second term, the Big Bang in the City of London draws the eye as a wedge hammered between the conservatives and the free-market right in the Conservative Party. On 27 October 1986, a series of measures affecting the London Stock Exchange (LSE) all came into effect simultaneously. Most notably, a number of restrictions and constraints were removed, such as the distinction between jobbers and brokers, fixed minimum commissions, the exclusion of foreigners from the stock exchange and restrictions on occupants of various financial roles working for larger firms. The original purpose of these regulations was to prevent conflicts of interest (particularly in the broker-dealer relationship) from undermining trust and misallocating capital. Unfortunately, they also helped cause the undercapitalization of the LSE. The City still had a pre-eminent position in international finance (not least because other reputable financial centres were also relatively tightly regulated), but had only a small presence in the important securities market. In  1984, the new Chancellor Nigel Lawson argued for accepting the LSE’s proposals for self-regulation.110 ‘At a difficult meeting in her room in the House of Commons, and against considerable oppositions, notably from Willie Whitelaw, we were able to persuade an apprehensive Margaret Thatcher to go along with this.’111 Even though Lawson ‘had come to respect its achievements, its expertise, and its generally high standard of integrity, and to warm to the value of what has

Hennessy, Cabinet, 122. Garnett and Aitken, Splendid! Splendid! 302. 107 Charmley, A History of Conservative Politics, 222–3. 108 O’Hara, Conservatism, 139–42. 109 Garnett and Aitken, Splendid! Splendid! 305. 110 Lawson, The View From No.11, 398–402. 111 Nigel Lawson, ‘Foreword’, in Big Bang 20 Years On: New Challenges Facing the Financial Services Sector, London: Centre for Policy Studies (2006), i–v, at ii. 105 106

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nowadays come to be known as fraternity which it notably embodied’,112 he still favoured the opportunities that would emerge once the City was deregulated and its ‘old boy’s network’ was replaced by a genuine meritocracy. The result, of course, was the massive growth of the City, the creation of the ‘Yuppy’ as a popular stereotype and the resurgence of the Canary Wharf area in London. Although the importance of the Big Bang was overlooked by many contemporary commentators,113 the Thatcher period was defined by the slogan that ‘greed is good’ (actually coined in a Hollywood film).114 Many former supporters were repelled, including John Nott115 and Sunday Telegraph editor Peregrine Worsthorne.116 Much of the economic growth between 1986 and 2007 was based on the greater availability of credit, a model whose sustainability is limited. The sensible injunction of the 1981 budget to spend what you earn was forgotten in the ‘Lawson boom’117; Lawson himself blamed the imprudence of building societies and banks (outside the government’s control) for problems.118 The measures may have increased competition between brokers and dealers, but decreased it between exchanges; worldwide, they became quoted companies, serving their owners rather than their users, and so investors have never seen the full benefits of competition.119 The way in which the deregulated model will cope with the greater risk aversion that can be expected after the 2007 financial crisis, and as the baby boomer generation begins to draw down upon its savings, is a matter of debate.120 The Big Bang121 led to much economic growth, but ultimately played a major part in the financial collapse after 2007. Financial innovation allowed debt to replace increased productivity as the main driver of international competitiveness. The financial sector never solved the problem of conflicts of interest, but continued to press for still further deregulation (one commentator Lawson, ‘Foreword’, ii. For example, Young, One Of Us, mentions it only once, at 499. 114 Charmley, A History of Conservative Politics, 221–2. 115 John Nott, Here Today, Gone Tomorrow: Recollections of an Errant Politician, London: Politicos (2002), 347. 116 Garnett, From Anger to Apathy, 244. 117 Charmley, A History of Conservative Politics, 233. 118 Lawson, The View From No.11, 627–31. 119 Alan Yarrow, ‘The challenges facing investment banking in the UK’, in Big Bang 20 Years On: New Challenges Facing the Financial Services Sector, London: Centre for Policy Studies (2006), 42–50, at 45. 120 Yarrow, ‘The challenges facing investment banking in the UK’, 49. 121 And other major acts of financial deregulation, helpfully listed in Lawson, The View From No.11, 626. 112 113

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argued with exquisitely bad timing in  2006 that ‘All regulation is bad’,122 a point of view no longer widely shared at the time of writing in  2012). Lines of supervisory responsibility were not clear. Enormous exposures to derivatives went undetected. Most importantly, it led to a suppression of the savings rate, which boosted the economy in the short-to-medium term, but which has undermined British pension provision and caused a debt crisis whose effects are unlikely to pass away quickly. The Big Bang was the antithesis of a conservative reform. It was forwardlooking, aiming to create opportunities where none had existed, and was theoretically based and strategic. It undercut long-standing arrangements and implemented radical change. After 1987, such radicalism became the norm.123

Conclusion E. H. H. Green points out that ‘the Conservative party’s reaction to the Beveridge Report, the tenor of its election campaign in 1945, and the attitude of the party’s rank and file through the 1950s and 1960s, indicates a very shallow level of “commitment” to a “consensual” framework . . . a “pragmatic” or “instrumental” acquiescence rather than a “normative agreement”  ’ .124 But the same sentence could be rewritten for the small-c conservative section of the Conservative Party, with ‘monetarist’ or ‘liberal free-market’ replacing the word ‘consensual’. Yet the point I wish to argue is that one could go along with the general tenor of Thatcher’s first term even if one was unpersuaded by liberalism. The governments of the 1950s were reluctant to take risks, because to do so might threaten the post-war boom. Life was good, and so change was less desirable. As Green suggests, ‘when inflation was reasonably low . . . , the economy was growing and living standards rising, the remarkable thing is the amount of discontent there was in the Conservative ranks’. The key factor in the adoption of riskier, more radical policies in the 1980s was the poor economic performance of the 1970s. Again, Green is right to point out that that only explains the increased appetite for risk, not the choice of monetarism rather than some other economic strategy.125 Joseph, Thatcher and their supporters in the Centre for Andrew Hilton, ‘All regulation is bad’, in Big Bang 20 Years On: New Challenges Facing the Financial Services Sector, London: Centre for Policy Studies (2006), 24–31. 123 Young, One Of Us, 520. 124 Green, Ideologies of Conservatism, 238–9. 125 Green, Ideologies of Conservatism, 236. 122

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Policy Studies and the Institute of Economic Affairs were able as no one else to articulate traditional small-c conservative grievances in tandem with a proposed solution. The result was a radical government that could draw upon conservative support. In the second term and onward, this became less true,126 partly no doubt due to the removal of some conservative personalities, particularly Whitelaw and Heseltine. But it is also evident that while some policies chimed with a conservative agenda (especially union reform), other advances had purely theoretical backing, and addressed no specific problem except presumed opportunity costs. In such cases, conservatives were naturally nervous, and they began to part company with the Thatcherites. Thatcherism may, as John Gray has argued,127 ultimately be incompatible with conservative values, but if it has undone conservatism, it was from 1983 onward, not before.

Ramsden, An Appetite for Power, 441ff argues that the process began in  1981, and this is when the tide began to turn against conservatism. The reshuffle of that year was certainly an important moment, but the 1983 election was the key legitimation of Thatcherite radicalism. 127 Gray, ‘The undoing of conservatism’. 126

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Section Two

The Conservatives and the Union

64

3

Tory Rebels and Tory Democracy: The Ulster Crisis, 1900–14 Robert Saunders

For most of the twentieth century, the Conservative Party has projected itself as the party of the Constitution. Since that Constitution could claim to be both ancient and democratic, while the threats were commonly perceived to be foreign, constitutionalism furnished the party with an appeal that was at once conservative, populist and patriotic – shielding a uniquely British achievement from radicals, socialists and the European superstate. It was a potent and supremely malleable appeal, investing the most dryly economistic programmes with a higher political purpose. As Margaret Thatcher proclaimed in 1979, ‘yes, we talk about jobs, we talk about inflation . . . but what we really believe in is . . . the future of parliamentary democracy, the future of everything which made Britain a great nation’.1 Like the ‘Church in Danger’ cry of the eighteenth and nineteenth centuries, appeals to the Constitution had a sharply partisan edge. In claiming for the Conservative Party the defence of ‘national’ institutions, constitutionalism marked out its opponents as sectarian and unpatriotic. The Labour Party,  in particular, was represented as a false friend of democracy, possessed of revolu­ tionary and totalitarian impulses that were hostile to freedom and impatient of constitutional safeguards. Stanley Baldwin told his party in 1925 that it was the peculiar task of Conservatism to uphold ‘the lifted torch of democracy’, for Labour was ‘snuffing the wick of a lamp that is burning too dimly’.2 Winston Churchill claimed in 1945 that ‘a free Parliament is odious to the Socialist doctrinaire’, and 1

2

Speech to Conservative Trade Unionists, 29 April 1979, http://www.margaretthatcher.org/ document/104053. R. Quinault, British Prime Ministers and Democracy: From Disraeli to Blair (London, 2011), 105.

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warned of a ‘Gestapo’ if Labour were to form a government.3 During the Wilson and Callaghan administrations of the 1970s, Conservatives accused the Labour Party of a ‘Reichstag method’ of government, which aspired, in Mrs Thatcher’s words, to bring ‘the Iron Curtain down on the Mother of Parliaments’.4 Yet the Conservative Party has its own revolutionary traditions, which deserve more attention than they have commonly received. It was Andrew Bonar Law, not a revolutionary socialist, who declared that ‘there are things stronger than parliamentary majorities’; and it was Conservative sympathizers who spoke in 1914 of ‘breaking the parliamentary machine’.5 Between 1912 and 1914, the Conservatives gave their enthusiastic support to the Ulster Volunteers, making them the only national party in the twentieth century to sponsor a paramilitary army. Conservatives were almost certainly complicit in running guns to that organization, an arrangement that has no analogue in Liberal or Labour history.6 Conservative election literature warned that Britain might soon be ‘stained with the blood of civil war’, for ‘No method remains, except armed revolt, by which the country could make its will prevail’.7 The ‘Ulster Crisis’ was not the only occasion on which Conservatives stepped outside constitutional convention. In the 1920s and again in the 1970s, Conservatives flirted with extra-parliamentary forces, ranging from paramilitarism to a political intervention by the Army. Yet most of those involved were on the fringes of the party, and the threat to civil order was largely hypothetical. What is unique about the Ulster crisis is the involvement of the party leadership, as well as the radicalism of the measures to which it gave support. From 1910 to 1914, as Robert Blake has written, ‘We find Privy Councillors recommending rebellion, former Law Officers of the Crown urging armed resistance to an Act of Parliament, prominent soldiers disregarding their oaths of secrecy, and Bonar Law himself, leader of the Tory Party, seriously considering whether to encourage a mutiny in the Army.’ Speaking in  1913, the future Lord Chancellor, F. E. Smith, proclaimed himself ‘absolved from 3 4

5

6

7

The Times, 5 June 1945, 4. The Campaign Guide, 1977 (London: CCO, 1977), 471–4, http://www.margaretthatcher.org/ document/110799; House of Commons, 15 July 1976, http://www.margaretthatcher.org/ document/103077. Bonar Law at Blenheim Palace, The Times, 29 July 1912, 7. ‘An Appeal to the Crown’, Fortnightly Review (December, 1913), 1011. For the evidence of Conservative involvement, see I. McLean and T. Lubbock, ‘The Curious Incident of the Guns in the Night Time’, in I. McLean, What’s Wrong With the British Constitution? (Oxford, 2010), 100–27. The Campaign Guide: A Handbook for Unionist Speakers (London, 1914), 45, 339.

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all allegiance to this government’, ready ‘to risk the collapse of the whole body politic’ rather than accept its legislation.8 The trigger for the crisis was a Liberal Home Rule Bill, which proposed to restore the Irish Parliament and to re-establish self-government for Ireland. Critics warned that Home Rule would break up the Empire, endanger Britain’s national security and place the Protestant population of Ireland at the mercy of a Catholic autocracy. Mining that strain of popular patriotism that coursed through Edwardian politics, Conservative propaganda demanded ‘Britain for the British!’ while voters were asked ‘Shall Redmond Rule Britain?’9 Yet Conservatives did not simply argue that Home Rule was objectionable. More ambitiously, they argued that it was unconstitutional – that ministers had no lawful power to pass Home Rule, and that in attempting to force it onto the Statute Book, they had exceeded the powers of a legitimate government. As such, the Liberals sat on the Treasury Bench ‘not as a Government, but as autocrats’, reduced, in Bonar Law’s words, to ‘a revolutionary committee which has seized by fraud upon despotic power’.10 Between 1912 and 1914, the Conservative Party advanced three very striking propositions: that the Constitution was ‘in suspense’; that the legislation of the Asquith administration no longer had the force of law; and that armed resistance was justified to overturn Home Rule. At no other time in the twentieth century has a major British party made such ambitious claims or flirted so overtly with civil violence. Yet Conservatives founded their case on expressly democratic principles, mobilizing the authority of the people against their elected representatives. This chapter explores the democratic case against Home Rule and its place in the development of Conservative political thought.11

  8

  9

10 11

R. Blake, The Unknown Prime Minister: the Life and Times of Andrew Bonar Law, 1858–1923 (London, 1955), 121; F. E. Smith at Ballyclare, Times, 22 September 1913, 24. For an excellent survey of Unionist arguments, see D. Jackson, Popular Opposition to Irish Home Rule in Edwardian Britain (Liverpool, 2009). John Redmond led the Irish Parliamentary Party in the House of Commons. Hansard 43, 13 November 1912, 2024; Times, 29 July 1912, 7. The scholarly literature on Conservative political thought during the Ulster crisis is surprisingly thin. D. Dutton, His Majesty’s Loyal Opposition: The Unionist Party in Opposition, 1905–1915 (Liverpool, 1992) offers an excellent survey of the period, but is principally concerned with party organization and high political manoeuvre. E. H. H. Green, The Crisis of Conservatism: The Politics, Economics and Ideology of the British Conservative Party, 1880–1914 (London, 1995) provides a superb analysis, but its focus is on tariff reform rather than constitutional controversy. Mclean, What’s Wrong With the British Constitution, devotes three chapters to the ‘Unionist coup d’état’, but is not especially concerned with the justifications offered by Conservatives for their actions. G. Phillips, The Diehards: Aristocratic Society and Politics in Edwardian England (London, 1979) focuses on the most reactionary group within the party, and so tends to overstate the anti-democratic case against the Liberals. There is a brief discussion of Conservative arguments in J. Ramsden, The Age of Balfour and Baldwin, 1902–1940 (London, 1978), 78–85.

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‘An outrage on democracy’ Home Rule had erupted into British politics in 1885, with the conversion to the cause of the Liberal leader, William Gladstone. The Home Rule Bill introduced in  1886 fractured the Liberal Party, with 93 ‘Liberal Unionists’ assisting the Conservatives to vote down the change. A revised proposal cleared the House of Commons in 1893, only to be voted down in the Lords by 419 votes to 41. Unwilling to face an election on the subject, the Liberal Party let the subject drop, and it receded still further into the background during the decade of ‘Unionist’ government after 1895.12 Even when the Liberals won a landslide majority in 1906, the party made no attempt to reactivate Home Rule. Pre-occupied with the defence of free trade and the first stirrings of welfare reform, ‘New Liberalism’ reoriented itself around social and economic questions – in a conscious shift of emphasis from its earlier constitutional agenda. The resurgence of Home Rule after 1910 owed as much to parliamentary arithmetic – what George Dangerfield called ‘the naughty calligraphy of Fate’ – as to any intellectual commitment on the part of the Liberals.13 The two general elections of that year were dominated by the ‘People’s Budget’ and the reform of the House of Lords; the government of Ireland was barely an issue and was not mentioned in either of the Prime Minister’s election addresses. The result, however, transformed the political landscape. A resurgent Unionist Party wiped out the Liberals’ parliamentary majority, achieving a dead heat in December of 272 seats for both major parties. Asquith remained at the head of a minority administration, but his government now depended upon the 40 Labour MPs and the 82 Irish Nationalists. That gave the Irish party a crucial pressure point, just as the budget crisis was weakening the power of the Opposition. The 1911 Parliament Act stripped the House of Lords of its veto, substituting in its place a 2-year delaying power. The great procedural obstacle to Home Rule had been eliminated, and a year later, the Liberals introduced their third Home Rule Bill. That triggered an immediate crisis in Ulster, where Sir Edward Carson put himself at the head of an outraged Unionism. Carson took the classic slogan 12

13

Any discussion of Conservative politics in this period is bedevilled by problems of nomenclature. From 1895 to 1905, the Conservatives governed in partnership with the Liberal Unionists, with candidates conventionally running for election as ‘Unionists’. In  1912, the two parties formally merged, forming the ‘Conservative and Unionist Party’. The two had ceased, however, to have any meaningful independent identity, and the term ‘Conservative’ is used throughout this chapter. G. Dangerfield, The Damnable Question: A History of Anglo-Irish Relations [1976] (London, 1999), 53.

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of Ulster loyalism – ‘Ulster will fight, and Ulster will be right’ – and set out to make it a reality. Half a million people signed the ‘Ulster Covenant’, pledging to resist Home Rule by all possible means, while up to 110,000 men enrolled in a volunteer army.14 They were backed enthusiastically by the Conservative Party. More than a million people on the British mainland attended anti-Home Rule demonstrations, while a similar number – including the Conservative front bench – signed a British version of the Ulster Covenant.15 Addressing a demonstration at Blenheim Palace in 1912, Bonar Law warned ministers that there are things stronger than Parliamentary majorities. . . . I can imagine no length of resistance to which Ulster can go in which I should not be prepared to support them, and in which, in my belief, they would not be supported by the overwhelming majority of the British people.16

For the Conservative Party, the struggle against Home Rule brought ideology and interest into close alignment. As the ‘Conservative and Unionist Party’, the defence of the Union was central to Conservative identity; accepting Home Rule would be a repudiation of everything for which the party had stood since 1886. As Lord Hugh Cecil put it in 1914, ‘we are the Unionist Party – that is we exist to oppose Home Rule’.17 At the same time, however, the campaign provided an opportunity to reunite a party that remained seriously divided over Tariff Reform and welfare policy. For the first time since the ‘khaki’ election of 1900, Unionism promised to realign the Conservative Party with a genuinely populist movement in the country. At a time when the Liberals were marking out their opponents as a sectarian minority, protecting the vested interests of a privileged elite, the campaign against Home Rule furnished Conservatives with a populist and even democratic crusade. As such, it promised to repeat the achievement of the first Home Rule crisis: splitting the Liberal Party, reclaiming the mantle of patriotism and furnishing the party with a popular and demotic ‘cry’. To Conservatives, Home Rule was not simply bad legislation. More radically, they insisted that it was beyond the constitutional authority of the elected 14

15

16

17

The 110,000 estimate is of peak strength in July 1914; see T. Bowman, ‘The Ulster Volunteer Force, 1910–20: New Perspectives’, in D. G. Boyce and A. O’Day (eds), The Ulster Crisis, 1885–1921 (Basingstoke, 2006), 247–58. Estimates of the number of signatories vary, as the process was interrupted by the outbreak of war. Daniel Jackson cautiously endorses Walter Long’s estimate of 831,000 men and 530,000 women; Jackson, Popular Opposition, 233. Blake, Bonar Law, 130. Asquith called this speech ‘a declaration of war against constitutional Government’; Hansard 41, 31 July 1912, 2137. Dutton, His Majesty’s Loyal Opposition, 237.

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government. This quickly snowballed into a larger argument: that Asquith and his ministers were no longer a legitimate administration and that armed resistance would be justified in removing the ministry from power. Not since the seventeenth century had leading politicians made such ambitious claims or aligned themselves so openly with extra-parliamentary measures. How, then, could it be argued that such a bill was ‘unconstitutional’? The most common argument was that it lacked a ‘mandate’ from the electorate. The idea that the Commons had no right to pass contentious legislation without such a mandate had emerged in the 1880s, during the leadership of Lord Salisbury. On the principle ‘that the nation is our Master’, but ‘the House of Commons is not’, Salisbury claimed for the House of Lords the right to resist all legislation for which there was no explicit electoral authority, yielding ‘only when the judgement of the nation has been challenged at the polls’.18 By 1910, this had evolved into a still larger doctrine: the right to force either a dissolution or a referendum on any issue that had not been decisive at an election, even if it had featured in a manifesto. The result was a transformation in the nature of the authority claimed for the Peers. An institution once projected as an aristocratic brake upon popular excess was now taking upon itself an expressly democratic function.19 As the Edinburgh Review noted anxiously in 1910: The House of Lords of to-day . . . recognises that it cannot prevail against the popular will; but it claims to interpret that will, and it refuses to recognise even enormous majorities of the House of Commons as its authorised exponents. Curiously enough, the Peers of to-day have taken their stand upon a principle of democracy a good deal more advanced than those upon which our institutions have been founded. The representative principle they hold cheap. They look for their “mandate” directly to the people.20

Lord Selborne concurred. The peers, he told the party conference in 1912, stood for ‘a great democratic principle (cheers) – the principle that there should be an appeal from Ministers who may be unscrupulous, from majorities which may be subservient, to the people from whom Ministers and majorities alike derive their power’.21 An institution founded upon the hereditary principle was now

18 19

20 21

Quinault, British Prime Ministers, 63–4. For the older view, see A. Alison, ‘Shall We Overturn the Peers?’ Blackwood’s Edinburgh Magazine, 38 (1835), 573–86. ‘The House of Lords and the Budget’, Edinburgh Review (January, 1910), 259–60. NUCA Annual Conference Report, 1912 (NUCA, 1912), 51.

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claiming a central place in British democracy; its ‘main function . . . to ensure that legislation is in conformity with the will of the nation’.22 The attraction of mandate theory was partly tactical: for, as Salisbury noted, the limits it placed upon the exercise of the veto were ‘so rarely applicable as practically to place little fetter upon our independence’.23 However, the democratic claims made for the Lords were only plausible because of a concurrent loss of faith in the Commons. With the rise of party and the growing control of the executive over the parliamentary timetable, it was increasingly difficult to view the Commons as an independent agency acting as a check upon government.24 The Commons, thought John Buchan, had become ‘a patent automatic machine which registers the edicts of a transient majority’25; instead of being held responsible at all times by the representatives of the people, it was increasingly argued that ministers were now irresponsible except during elections. The constitutional writer William McKechnie complained that the Commons was ‘no longer made up of free representatives, but of tied delegates’, marshalled ‘by pressure of the party Whips’. ‘Representative government’, responsible to a free and deliberative assembly, had ‘given way to government by the party machine voting to order’.26 More serious still was a loss of faith in the representative principle per se: the convention that the will of the people was vested in their elected representatives. Critics argued that the rise of party had shrivelled the field of electoral choice: voters were compelled to choose from a tiny menu of candidates, selected for them by party committees and caucuses. They had no control over their Members once in Parliament, and the opinions of those MPs on most subjects had never been brought before the electorate. In consequence, as the Fortnightly Review asserted, ‘the real opinion of a country is not necessarily represented, and in recent years has usually been misrepresented, by the parliamentary delegates of the people’.27 Lord Selborne made a similar point, in his 1913 volume on The State and the Citizen. There was, he argued,

22 23 24

25

26 27

The Campaign Guide: A Handbook for Unionist Speakers (1909), 67. Quinault, British Prime Ministers, 64. For institutional and procedural change, see P. Fraser, ‘The Growth of Ministerial Control in the Nineteenth-Century House of Commons’, EHR, 75 (1960), 444–63. J. Buchan, ‘Democracy and Representative Government’, Fortnightly Review (November, 1913), 864. W. McKechnie, The New Democracy and the Constitution (London, 1912), 30–2. W. M. Kennedy, ‘Why Home Rule is Unnecessary’, Fortnightly Review (June, 1913), 1082.

72

The Foundations of the British Conservative Party no necessary correspondence between the will of an elected assembly and the will of those who elected it a few months or years before. Further, there is no correspondence between the will of an ordinary elector, and that of either of the two or three professional politicians between whom he must choose at the polls. . . . experience has shown how easily the decision of a representative chamber may be the opposite of that which would have been pronounced by the majority of the electorate.28

In  1906, when the Conservatives fell victim to an electoral landslide, Conservative publications produced elaborate calculations to show how the result had exaggerated support for the Liberal Party. Unionists, they concluded, were outnumbered in the new House by more than three to one, when the disparity of votes in the country was only eight to five; and ‘the disproportion has become infinitely greater as time has gone on’.29 Selborne assured his party that the House returned in 1906 bore no relation to the wants and wishes of the electorate. ‘Cautious electors’, he complained, had viewed the contest chiefly as a referendum on tariff reform; after the polls closed, they had ‘discovered to their surprise’ that their representatives ‘held the most extreme views on all sorts of questions which had hardly entered the electors’ heads’.30 Confidence grew as the election receded in time, especially with by-elections indicating a swing to the Conservatives.31 By 1911, Conservatives were routinely referring to the ‘false majority’ in the Commons, while the Edinburgh Review accused ministers of rank arrogance for believing ‘that the accident of a parliamentary majority gives them the right to do whatever they choose’.32 As the Campaign Guide concluded briskly in 1914, ‘the House of Commons does not truly represent the people, nor do its votes represent the opinions of the electorate’.33 That provided a rationale – on popular and even democratic principles – for the extensive use of the veto. From 1906 to 1909, the Upper House emasculated 28

29 30 31

32

33

Earl of Selborne [William Waldegrave Palmer], The State and the Citizen (London, 1913), 143, 163–4. Campaign Guide (1909), 66. Selborne, State and the Citizen, 113. By August 1909, there had been 66 contested by-elections, which party literature calculated had produced a net gain of 39,917 votes to the Unionists and a net loss of 60,863 to the ‘Radicals’. ‘The Will of the People’, Conservative Party Archive [CPA] Pamphlets, Bodleian Library, X Films 63/2, 1909/53. ‘The Struggle for Freedom’, Edinburgh Review 219 (April, 1914), 490. My italics. For the ‘false majority’, see Campaign Guide (1909), 66; ‘The Will of the People’, CPA Pamphlets, X Films 63/2, 1909/53; ‘One Vote – One Value’, CPA Pamphlets, X Films 63/2, 1913/26. ‘The Parliament Bill: What it Means and What it would Lead to’, Conservative and Unionist (April, 1911), 56. Campaign Guide (1914), 57.

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Liberal legislation on an unprecedented range of issues, for which peers insisted there was no popular mandate. Liberals were, in effect, being challenged to put these measures directly to the people, either in a referendum or in a general election. When the Liberals finally took up that challenge, after the Lords had vetoed the budget in 1909, the ensuing contest brought two visions of popular government into collision. For Lloyd George, the peers were guilty of an unwarranted interference in the affairs of the ‘people’s House’. This, he believed, was a contest between ‘the peers and the people’, which would determine the future of democratic government. Conservatives, by contrast, projected the veto as a democratic safeguard, which had referred the budget to the judgement of the people.34 The Fortnightly Review hailed the peers as ‘better democrats than any member of the government’. They would ‘abide by the will of the people . . . [in] January 1910’, but they would not accept ‘the Radical-Socialist pretence in 1909 at interpreting the will of the people as expressed in 1906’.35 That refusal to accept the representative credentials of the Commons, just half-way through a potential 7-year term, allowed the peers to represent themselves as popular champions against an autocratic and irresponsible ministry. A campaign leaflet set out the choice before the public:

The Unionist Policy

The Radical Policy



Commons Superior Lords Subordinate PEOPLE SUPREME

COMMONS SUPREME Lords nowhere People nowhere

‘Vote for the Unionist’, electors were urged, ‘and the Supremacy of the People’.36 On this reading, the Parliament Act – which stripped the Lords of its veto, substituting only a 2-year suspensory power – was ‘absolutely alien to the spirit of democracy’, a way of liberating the Commons from popular oversight.37 Its purpose, according to F. E. Smith, was to concentrate ‘every faculty of government in the hands of a small clique’, which had ‘cheated the people of every vestige of effective control over the national policy’.38 Conservatives accepted that the 34

35 36 37

38

One poster portrayed a peer speaking on the telephone to a working man. The caption reads: ‘The Peers to the People: Hullo, are you there? We are waiting for instructions’. CPA on-line poster archive (http://www.bodleian.ox.ac.uk/cpa), Poster 1909/10–25. E. Salmon, ‘The Peers as Democrats’, Fortnightly Review, 93 (February, 1910), 236. CPA Pamphlets, X Films 63/2, 1910/222. Sir Robert Finlay, Hansard 15, 31 March 1910, 1493. Finlay served as Lord Chancellor from December 1916 to January 1919. F. E. Smith, ‘The Parliament Act Considered in Relation to the Rights of the People’, in Rights of Citizenship: A Survey of Safeguards for the People (London, 1912), 27, 36.

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composition of the Lords was open to criticism and produced their own proposals for a ‘democratic’ reform of its membership.39 The Parliament Act, by contrast, left the composition of the House unchanged but removed its substantive powers, dismantling the only check by which legislation could be referred to the judgement of the people. As such, it appeared to many Conservatives a blatant attempt to render government accountable only to a subservient party majority, liberating it from ‘that which is, after all, the source of . . . all strength, all power in this country – namely, the democracy itself ’.40 Austen Chamberlain told MPs in 1910 that ‘The people have a right to be consulted on great issues on which they have never expressed an opinion, and your claim to be a democraticallygoverned country is a farce unless you are prepared to recognize that right’.41 The verdict of the elections in January was sufficiently ambiguous to give credence to such claims. On the budget itself, the Upper House could plausibly claim vindication. The Liberals lost more than a quarter of the 400 seats won in 1906, eliminating their majority and leaving them dependent on the sufferance of minor parties. For all the talk of ‘the peers versus the people’, the House that assembled in February almost certainly contained a majority against the budget. It passed only because the Irish MPs, who had been critical of the budget in 1909, voted with the government in return for a reduction in the powers of the Lords. Not surprisingly, Conservatives concluded that ‘The Lords had correctly judged the opinion of the country’. Here, they argued, was proof of the necessity of a second chamber, able to protect the public interest from corrupt bargains in which MPs chose to ‘vote against the opinion of their constituents’.42 That judgement was afforced by the second general election in December 1910. The Conservatives won the largest number of votes in that contest and returned the same number of MPs as the Liberals, and a string of by-election wins swiftly established the Conservatives as the largest single party in the House. Yet they found themselves marginalized in the Commons by an alliance of Liberal, Labour and Irish Nationalist Members, powerless to prevent the passing of the Parliament Act. In this context, the Parliament Act appeared ‘an outrage on democracy’.43 For Conservatives, the loss of the veto stripped 39

40 41 42

43

See D. H. Close, ‘The Collapse of Resistance to Democracy: Conservatism, Adult Suffrage, and Second Chamber Reform, 1911–28’, Historical Journal, 20 (1977), 893–918. Lord Curzon, Hansard 5, 16 March 1910, 294. Hansard 16, 6 April 1910, 471. Campaign Guide (1914), 42. See also F. E. Smith, Hansard 14, 22 February 1910, 100–1 and 10 March 1910, 1659. F. E. Smith, Hansard 21, 22 February 1911, 1933.

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the largest party in the state of any formal power within the legislative process, and it removed any possibility of an appeal to the public against chance combinations in the Commons. Conservatives accused ministers of establishing ‘single chamber government’, designed to ‘place the people at the mercy of an uncontrolled House of Commons’.44 As Selborne protested in 1911, the Conservatives ‘were the representatives of at least half the nation’.45 A party representing 47 per cent of voters was being sidelined, just as the Constitution itself was being redrawn. This mattered more than ever, in Conservative eyes, because of the type of government now in office. For Conservatives, the arrangement between the Liberals and their junior allies had all the attributes of a corrupt bargain. The Irish would vote for Welsh Disestablishment, in return for Welsh votes for Home Rule. Labour would support Home Rule, in exchange for trade union immunities and the reversal of the Osborne Judgement. None of these policies, Conservatives believed, commanded popular support across the country, but in the absence of any safeguard, parties could barter and trade their way to a majority on the floor of the Commons. The result, in Unionist eyes, was an ‘oligarchy’, with ‘laws made for us by groups of minorities’.46 In Lansdowne’s words, the Commons had fallen victim to ‘a vast and organized conspiracy against the public welfare’, producing a Parliament ‘in which the Unionist Party was stronger than any other party, but which was . . . dominated by a well-organized Coalition’.47 To make matters worse, Conservatives doubted the popular credentials of both the parties with whom the Liberals had allied. Measured by population, Ireland was significantly over-represented, giving the government ‘over 36 votes to which the voting strength of parties in the country does not entitle them’. This alone, Conservatives grumbled, made ‘Liberal talk about the “People’s Will” . . . both false and hypocritical’.48 Meanwhile, the Labour Party was accused of accepting bribes. In 1912, for the first time, MPs were paid an annual salary of 44 45 46 47

48

‘Single Chamber Government: What it Would Mean’, CPA Pamphlets, X Films 63/2: 1910/73. NUCA Annual Conference Report, 1911, 59. Selborne, NUCA Annual Conference Report, 1911, 24. NUCA Annual Conference Report, 1911, 13; NUCA Annual Conference Report, 1912, 51; Albert Hall demonstration, 1 May 1914, reprinted in Primrose League Gazette (May, 1914), 8. Campaign Guide (1914), 57. McLean’s assertion that Unionists did not deploy the over-representation of Ireland as an issue is puzzling; McLean, What’s Wrong with the British Constitution?, 121, 147. See, for example, the motion carried at the 1912 Conservative conference: ‘that the gross overrepresentation of Ireland at Westminster . . . renders the House of Commons unfit, until it has been reformed, to deal with so grave a Constitutional change as Home Rule’; NUCA Annual Conference Report, 1912, 50; ‘One Vote – One Value’, CPA Pamphlets, X Films 63/2, 1913/26; ‘Fighting Notes’, CPA Pamphlets, X Films 63/2, 1914/65.

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£400. Unionists complained that each Labour MP now had a financial incentive to stave off an election for as long as possible – holding off a contest in which both their salaries and their seats would be at risk. For the first time since the age of Walpole, it was now ‘financially advantageous to members to support the Government’.49 The Labour MPs had been purchased ‘every bit as firmly as when they were bought by a sinecure or a job’.50 All this constituted a formidable constitutional case. Ministers, it was alleged, had suppressed the independence of the Commons and freed themselves from popular oversight. Through the Parliament Act, they had stripped away the one safeguard against legislation for which there was no popular support in the country. They had bribed the Labour Party and made a corrupt pact with the Irish contingent – a party that was over-represented in Parliament and that was suspected of taking American money. All this had been done without any direct authority from the people, by means of what many Conservatives considered a fraud upon the public. The Parliament Act was professedly a temporary measure, until a new second chamber could be established ‘on a popular instead of hereditary basis’.51 Until that reform was completed, Conservatives argued, the constitution was ‘in suspense’.52 As Bonar Law told the party conference in 1911, ‘we are living to-day under a provisional constitution’. It was unconstitutional, he insisted, to propose great changes until the work of renovation was complete.53

‘Every vote for the Liberal is a vote for Civil War’ Into this combustible environment came the Home Rule Bill. For Conservatives, the attempt to drive through Home Rule was an outrage against popular government. The measure, they protested, had no mandate from the public and had scarcely even been ventilated at the recent elections. The last time it had come clearly before the public, in the election of 1895, the Unionists had won a crushing majority. The measure was being propelled through Parliament at a time when the Constitution was in suspense and when there was no mechanism 49 50 51 52

53

G. A. Arbuthnot (ed.), The Primrose League Election Guide (London, 1914), 89. Original emphasis. ‘An Appeal to the Crown’, Fortnightly Review (December, 1913), 1015. ‘Parliament Act 1911’, 1911 c.13 (1 and 2 George V), introductory text. J. A. R. Marriott, ‘The Constitution in Suspense’, The Nineteenth Century and After (January, 1914), 1; see also Lansdowne, Albert Hall, 1 May 1914, Primrose League Gazette (May, 1914), 9. Bonar Law, NUCA Annual Conference Report, 1911, 50.

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for holding the Commons to account. The government had no independent majority in that House and was engaged in a corrupt bargain with parties whose own representative credentials were in doubt. This was a democratic case against Home Rule, and it allowed the Conservatives to annex a language more commonly associated with their opponents. Conservatives insisted that fundamental legislation should be referred to the judgement of the people, either through a general election or through a special referendum; and they contrasted that impulse with the Liberals’ ‘autocratic’ insistence on the supremacy of the House of Commons. Lord Curzon told the peers that ‘there can be nothing much more democratic than a wish to consult, and defer to, the will of the people’, while Lord Hugh Cecil accused ministers of ‘a violation of the foundations of democratic Government’. Questions ‘of such stupendous magnitude’, he insisted, ‘should be settled by the people at large’.54 Balfour, who claimed to be ‘as strong a democrat as is to be found in this House’, wondered why ministers refused to put their measures before the people, ‘the only source from which the true democrat desires to obtain his inspiration’.55 Backbenchers accused the ministry of abandoning constitutional and popular government: ‘instead of being, as it poses to be, a democratic Government’, ministers were ‘turning themselves into a more autocratic form of Government than we have ever witnessed in this country’.56 With its claim to decide its own destiny, Ulster could also be mobilized within a larger democratic argument. If the essence of democracy was the right to choose how one was governed, then the Ulster Volunteers could be said to embody a great democratic cause. Londonderry insisted that ‘the movement in Ulster is an entirely democratic one’, while Bonar Law told Parliament that the ‘volunteers are a more democratic army than has ever existed in the world, not excepting Cromwell’s own New Model in the time of the Civil War’.57 Such arguments were vulnerable, of course, to an equivalent claim on behalf of Irish nationalists, but Conservatives insisted that it was only in the North that the people spoke with a free and unfettered voice. As Carson put it, ‘the only real democracy in Ireland

54 55 56 57

Curzon, Hansard 14, 15 July 1913, 1014; Cecil, Hansard 58, 11 February 1914, 204. Hansard 22, 2 March 1911, 566; 65, 27 July 1914, 1056. Sir Harry Samuel, Hansard 21, 7 February 1911, 211. Londonderry, Hansard 15, 12 February 1914, 157; Bonar Law, Hansard 60, 25 March 1914, 430. James Craig, later Prime Minister of Northern Ireland, likewise insisted that ‘We represent the democracy’, Hansard 21, 22 February 1911, 2012.

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The Foundations of the British Conservative Party

is the democracy of North-East Ulster’, for voters in the South ‘act absolutely at the dictates of leagues’.58 The problem was that Conservatives lacked any constitutional means of preventing the measure from passing onto the Statute Book. The Parliament Act had dismantled their veto in the Lords, and they had no effective influence within the Commons. The latter was brought home most dramatically in 1912, when the Conservatives won a division limiting the funds available to the proposed Irish Parliament. Though the vote came on more quickly than had been anticipated, it was far from a snap division. More than 400 MPs were present and the government was defeated by 227 votes to 206. When Asquith announced his intention to rescind the vote – an action almost without precedent in parliamentary history – tempers on the Conservative benches reached boiling point. Likening Asquith to Cromwell, Bonar Law accused the prime minister of having ‘destroyed Parliamentary government’. The Cabinet, he declared, had become ‘a revolutionary Committee’ that must now ‘be overthrown’. Back-­ benchers complained that the Commons was ‘no longer a representative assembly’ and accused ministers of sounding ‘the death-knell of Parliamentary Government’. Amidst shouts of ‘Traitor!’ and ‘Civil War!’, the House was suspended – only for violence to break out as MPs left the Chamber. When Churchill goaded the Conservative benches, an enraged backbencher hurled a copy of the standing orders at him, striking him hard in the face. Churchill had to be restrained by his fellow ministers and be dragged, struggling, from the Chamber.59 By driving through Home Rule, Bonar Law declared, ministers were ‘exceeding the powers with which they were entrusted by the nation’. In so doing, ‘they have become themselves revolutionaries’, and ‘becoming revolutionaries, they have lost the right to that implicit obedience which can be claimed by a Constitutional Government’.60 Even the constitutional theorist A. V. Dicey, who had done more than any other thinker to assert the unrestricted sovereignty of Parliament, insisted that a Home Rule Act would ‘be in form a law but will lack all constitutional authority’.61 Selborne told the party conference that ‘all laws’ 58

59 60

61

Hansard 42, 21 October 1912, 1851. See also Mark Sykes, Hansard 46, 15 January 1913, 2134: ‘The demand [for Home Rule] . . . is not the demand of the Irish people. . . . Uncontested by-elections and secret societies have seen to it that the democracy of Ireland has been robbed of the power of expression’. Hansard 43, 13 November 1912, 2003–54; Times, 14 November 1912, 6. Bonar Law at Carnarvon, 11 December 1913; reprinted in NUCA, Gleanings & Memoranda, xvii (January–June, 1914), 26. A. V. Dicey, A Fool’s Paradise: Being A Constitutionalist’s Criticism on the Home Rule Bill of 1912 (London, 1913), 117. My emphasis.

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passed by the Liberals ‘were tainted laws, of which Unionists did not admit the moral authority’.62 When a speaker at the 1912 conference uttered the fateful words ‘We have a Government’, he was interrupted by cries of ‘No, no!’. Suitably chastened, he corrected himself to ‘a Government so called’. A reference by Bonar Law to ‘the Prime Minister’ drew hisses and groans, and cries of ‘Traitor’ from the conference floor.63 Election material insisted that this was no longer a government in the conventional sense, but ‘a self-appointed clique of politicians calling themselves “The Cabinet”’.64 That provided a constitutional and even democratic rationale for taking the campaign outside Parliament. The target was no longer simply the Home Rule Bill; rhetorically, at least, it extended to the removal of the Liberal government from power. As Bonar Law pledged at Blenheim, Conservatives would take ‘whatever means seem to us most effective, to deprive [ministers] of the despotic power which they have usurped’.65 He pressed upon the king a revival of the Royal Veto, on the grounds that the functions previously exercised by the Lords devolved, under the ‘provisional constitution’, upon the Crown. The party also considered using its suspensory veto against the annual Mutiny Act, which would effectively have dissolved the army until the two parties could agree.66 The Conservatives’ strongest weapon, however, was paramilitary. Across the Irish Sea, Sir Edward Carson had built the Ulster Volunteers into a serious military force, trained by British officers and armed by Conservative sympathizers. Law had no hesitation in endorsing that force, participating in a formal inspection ceremony in July 1914.67 He signed the British Covenant, which pledged its signatories to resist Home Rule by ‘all means which may be found necessary’, while Conservative posters proclaimed that ‘Every Vote for the Liberal is a Vote for Civil War’.68 All this was couched in an uncompromising democratic rhetoric. As one MP asserted in 1914, ‘what we are fighting for is the control of the democracy over the House of Commons’. ‘Our forefathers’, he continued, ‘had to fight . . . to preserve this country from the doctrine that Kings had the divine right to govern without reference to Parliament’; in like manner, modern Conservatives would fight this new tyranny, which claimed ‘a divine 62 63 64 65 66 67

68

Selborne, NUCA Annual Conference Report, 1911, 59. My emphasis. NUCA Annual Conference Report, 1912, 16, 57. ‘Fighting Notes’, CPA Pamphlets, X Films 63/2, 1914/65. Law at Blenheim Palace, 29 July 1912, Times, 29 July 1912, 7. Blake, Bonar Law, 133, 151–2, 174–7. For a remarkable photograph, see M. Mulholland, Northern Ireland: A Very Short Introduction (Oxford, 2003), 18. Conservative Party Archive, X Films 63/2, 1914/108.

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right to legislate and to govern the country without reference to the people of the country’.69 By the summer of 1914, with the delaying power of the House of Lords about to expire, the political mood was becoming volcanic. Conservative MPs were openly drilling recruits, ready ‘at a moments notice to take up arms’.70 The Primrose League was preparing refugee camps for the women and children of Ulster, and political rhetoric was becoming increasingly apocalyptic. Warning against the use of force to suppress the Ulster Volunteers, F. E. Smith told a demonstration that ‘Ministers who try and use the army will end up swinging from the lamp-posts of London’.71 The Times thought it ‘one of the greatest crises in the history of the British race’, and in this context, the coming of war in Europe was almost a welcome distraction.72 As the prime minister correctly foresaw, the European crisis would ‘take attention away from Ulster’. This, he added laconically, ‘is a good thing’.73

Conclusion The period from 1912 to 1914 constitutes the forgotten crisis of modern British politics, an episode that has all but disappeared from popular memory. This is curious, for it sits at the juncture of three grand ‘themes’ in twentiethcentury history: the evolution of parliamentary democracy; the adaptation of the Conservative Party to democratic politics; and the emergence of ‘Northern Ireland’ as a political ‘problem’. Yet the Ulster crisis sits uneasily with the popular narratives of British history, emphasizing as they do the unique stability of British institutions and the peaceful evolution of democracy. With its paramilitary style and impassioned defence of the hereditary chamber, Conservative thought in this period has an anomalous quality that seems more at home in the predemocratic era than in the age of popular government. For this reason, it is tempting to view the campaign as the last spasm of a feudal elite, a class ‘which for so long has imposed its will upon every Government’, yet whose ‘domination [was] at last passing from it’. On this reading, the animating principle behind 69 70 71 72 73

Sir William Mitchell-Thomson, Hansard 58, 10 February 1914, 126. Morning Post, 3 July 1914, quoted in Jackson, Popular Opposition, 232. Jackson, Popular Opposition, 224. The Times, 27 July 1914, 9. Asquith to Lady Ottoline Morell, 25 July 1914; quoted in Jackson, Popular Opposition, 235.

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the movement was not constitutional propriety or even sectarian animus, but a ‘furious indignation at seeing the control of this country at last fall into the hands of the Democracy’.74 It is certainly possible to build a democratic case against the Conservatives before 1914. The Home Rule parties had secured a majority at three consecutive general elections, and they enjoyed a majority over the Conservatives of 96 seats at the outbreak of war. In passing the Home Rule Bill, ministers followed strictly the procedures set out in the Parliament Act – a measure which had been expressly placed before the electorate in December 1910. As many Liberals pointed out, the Conservatives’ insistence on the democratic rights of Ulster was not matched by any equivalent concern for the rest of Ireland; on the contrary, Irish nationalism was simply dismissed as an index of Irish opinion. Liberals accused their opponents of demanding a right of veto for favoured minorities – whether the Conservatives within Parliament or the Ulster Unionists within Ireland – and of turning to military force to overturn the verdict of the constituencies. As the Liberal MP William Pringle complained, Conservatives seemed to be operating on the principle ‘that when any law is being passed by the Imperial Parliament, you only need to drill a sufficient number of men and to get a sufficient number of rifles and then the Government of the day will be intimidated into surrender’, a principle that cut at the very ‘root of the democratic representative system’.75 Nonetheless, it is not necessary to accept the democratic case against Home Rule to acknowledge its centrality to the Unionist case. The intrusion of democratic ideas into Conservative thought was not wholly new, but it was only during the Home Rule crisis that it came to saturate the rhetoric and argument of Conservative politics.76 No Conservative leader before Balfour had described himself as ‘a democrat’ or wrapped himself so ostentatiously in the democratic mantle.77 In this respect, the Ulster crisis was not so much a repudiation of democracy among Conservatives as part of the process by which that party accommodated itself to democratic principles. From this perspective, the democratic rhetoric of interwar Conservatism – articulated most powerfully 74 75 76

77

Earl Russell, Hansard 15, 23 March 1914. Hansard 58, 11 February 1914, 258. For the changing usage of democratic language across the long nineteenth century, see R. Saunders, ‘Democracy’, in D. Craig and J. Thompson, The Languages of Politics in Nineteenth Century Britain (forthcoming: Palgrave, 2013). The attribution of ‘Tory democracy’ to Disraeli was a fabrication of the later nineteenth century that depended very heavily upon his youthful writings. Steering the Second Reform Act through Parliament in 1867, Disraeli assured MPs that ‘we do not live, and I trust it will never be the fate of this country to live, under a democracy’, Hansard 186, 18 March 1867, 7.

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by Stanley Baldwin – owed an unlikely debt to the paramilitarism of the pre-war period.78 The comparison with Baldwin should not, of course, be overstated; for while Baldwin fused parliamentary institutions with democratic legitimacy, the opposition to Home Rule was predicated on the inadequacy of Parliament as a democratic tribunal. For Unionists before 1914, the House of Commons seemed ‘totally unrepresentative as far as democracy is concerned’, and it was this conviction that justified the recourse to extra-parliamentary violence.79 In vesting so much faith in the House of Lords as a democratic institution, Conservatives had been compelled to play down electoral representation as an index of the popular will. References to ‘the accident of a parliamentary majority’, and a refusal to accept that a Parliament elected in 1906 might still represent the people in 1909, struck to the very heart of the elective principle, encouraging the party to look outside Parliament for expressions of the popular will. Why, then, was there no recurrence of this episode in the years after 1914? Some of the anxieties expressed in this period were eased over the decades that followed. Universal suffrage and constituency reform made it harder to dispute the validity of election results, while the Anglo-Irish Treaty of 1921 removed the Irish question from the mainstream of British politics. From 1918 to 1997, the Conservatives were in government for 59 out of 80 years, and that electoral success undoubtedly soothed their anxieties about electoral representation. Not until 1945 did the party again face a reforming government with a clear majority in the Commons, by which time paramilitarism had acquired dangerous continental associations. Just as importantly, British politics has not subsequently polarized around a major constitutional issue, nor one that involves the proper boundaries of the ‘demos’ itself. Issues that might qualify as such – like the Northern Ireland problem or European integration – have divided opinion within, rather than between, the major parties, and neither stirred popular movements on the British mainland. Since the 1970s, it has become a convention that major constitutional change should be submitted to a referendum, though that convention possesses no legal force and there is no agreement on what qualifies as substantial constitutional change. Nonetheless, the constitutional issues exposed after 1912 were suspended, rather than resolved, by the coming of war. The British Constitution continues 78

79

For the best discussion of Baldwin’s democratic thought, see P. Williamson, Stanley Baldwin: Conservative Leadership and National Values (Cambridge, 1999), 203–42. Roland McNeill, Hansard 34, 19 December 1912, 338.

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to lack institutional safeguards against constitutional change. There are few practical constraints upon a government between elections, and opposition parties – however great or small their share of the vote – exercise little effective power within the Commons. A multi-party coalition from which the Conservatives were excluded, that took up significant constitutional reforms, would raise some of the same dilemmas today as in the Edwardian era. In the general election of 2010, such a scenario did briefly appear possible; and the reaction of the Conservative press was striking. Warning of a ‘rainbow coalition’ combining Labour, the Liberal Democrats and the nationalist parties, The Sun proclaimed that Britain has gone from democracy as we know it to the brink of dictatorship. A desperate stitch-up is being attempted which will mean voters’ faces being ground into the dust. Britain has been called the cradle of democracy. If this deal goes through, democracy will be in its grave. . . . If [Cameron] is now to be robbed of his victory, then this will have been the election that saw democracy die in Britain.80

The Times put it more elegantly, but it, too, accused Labour of ‘defying the verdict of the electors’. Any such alliance, it concluded, would mark ‘a bleak day for our democracy’.81 The mooted deal, of course, did not happen, but scenarios of this kind may become more, rather than less, common in the years ahead. Governments returned in this way may face increasingly divisive constitutional issues – from the West Lothian question to the relationship between Britain and Europe. While these issues do not involve religious or sectarian questions to the same extent as Home Rule, they have the capacity to tap similar feelings of nationalism and are similarly difficult for future governments to reverse. It remains to be seen whether Conservatism can navigate such conflicts more successfully in the twenty-first century than in the first decade of the twentieth.

80 81

‘Democrazy’, The Sun, 11 May 2010. Editorial, Times, 11 May 2010.

4

The Conservative Party and the Irish Question, c.1885–2010 Alan Macleod1

According to Harold Wilson, the Labour Prime Minister in office at the beginning of Northern Ireland’s ‘Troubles’, British policy towards Ireland was constrained by the ‘law of diminishing acceptability’. As conditions in the Province deteriorated, violence increased and positions polarized, increasingly radical political measures were required in order to retrieve the situation and end the violence. For Wilson this meant choosing the most radical option available and coming out in favour of Irish reunification.2 Yet this was not a position that any Conservative Prime Minister could ever adopt. The Conservative Party is the party of the Union, forged in its modern form during the home rule debates of the late nineteenth century and still instinctively Unionist in the twentyfirst century. Nevertheless, over the period since 1885, the Conservative Party when in government still had to face the ‘Irish question’. At times it did indeed opt for radical political reform. But this normally was only attempted once the alternative, coercion, had been tried and had failed. The Irish question was at its most acute during two broad periods. The first, from 1885 to 1922, started with the home rule debates and eventually led to the partition of Ireland and the secession of the majority of the island from the Union. Then, after a period of relative peace, came the Troubles in Northern Ireland, which erupted in the late 1960s and were to continue until the Good Friday Agreement of April 1998 formally ended the paramilitaries’ campaigns and offered a political alternative to the violence. 1

2

I would like to thank Prof Simon Ball for his comments and advise on the preparation of this chapter. National Archives (hereafter NA), PREM 15/1022, ‘Note for the Record: Northern Ireland’, 24 November 1971.

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Although very different periods in Britain’s political history, it is possible to identify two different strands in the Conservative Party’s Unionism – one ideological and one pragmatic. The ideological strand was dominant when the party’s policy was in the hands of its right wing and when it was in opposition. However, the party’s Unionism tended to be more pragmatic when it was being led from the left or the centre and when it was actually responsible for the Irish question by being in government. This had important consequences for Ireland. For when ideological Unionism was dominant, the party followed policies of coercion and conciliation that failed to address the fundamental constitutional issues and created the conditions for increasing polarization and violence. By contrast, when the party’s Unionism was more pragmatic, the leadership invested time and political capital in addressing the Irish question, seeking political accommodation and willing to compromise its preferred constitutional position in order to achieve a settlement.

From home rule to partition Under the leadership of Charles Stewart Parnell the campaign for home rule for Ireland gained momentum and effectiveness in the 1880s. The home rulers’ greatest success was the conversion of the Liberal leader, William E. Gladstone, to their cause in late 1885. Gladstone’s conversion, however, caused a schism in his party and resulted in the realignment of British politics. Lord Hartington, leader of the old Whig interest in the Liberal Party, refused to join Gladstone’s short-lived administration of 1886 in order to oppose any home rule measure. In addition, Joseph Chamberlain, a leader of the Radical wing of the party, resigned shortly after the government’s formation once it became clear that Gladstone was intent on proceeding with a Home Rule Bill. Hartington and Chamberlain thus became the leaders of the Liberal Unionists and combined, along with their supporters and the Conservative opposition, to defeat the Home Rule Bill, bringing down Gladstone’s government in the process.3 In order to keep Gladstone and his home rule Liberals out of power, Hartington and Chamberlain were willing to maintain Lord Salisbury’s 3

Roy Jenkins, Gladstone (London: Macmillan, 1995), 536–8; P. Fraser, ‘The Liberal Unionist alliance: Chamberlain, Hartington, and the Conservatives, 1886–1904’, The English Historical Review, 77(302) (1962), 55; and Peter Davis, ‘The Liberal Unionist Party and the Irish policy of Lord Salisbury’s government, 1886–92’, The Historical Journal, 18(1) (1975), 87.

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Conservatives in power. But at this stage the Liberal Unionists were unwilling to unite with the Conservatives. Instead they supported the Tory government from the opposition benches, which they awkwardly shared with their erstwhile Liberal colleagues. Only one Liberal Unionist, George Goschen, was willing to serve in Salisbury’s government, and this Goschen did only once he had received Hartington’s blessing and after Salisbury had accepted that Goschen would not join the Conservative Party. It was not until the changed circumstances of 1895, after the short-lived Liberal government of 1892–95 had made a second attempt at introducing home rule, this time defeated in the House of Lords, that Chamberlain and the Duke of Devonshire (as Hartington had now become) agreed to serve in a Conservative government. Only in 1912 was there a formal merger of Liberal Unionists with Conservatives.4 Nevertheless, the secession of the Liberal Unionists from the Liberal Party and the creation of an anti-home rule coalition with the Conservatives led to the creation of a party that was ideologically Unionist. The Conservative Party had almost unanimously, and instinctively, been opposed to home rule. But beyond this instinctive Unionism were other motivations – motivations that were shared by the Liberal Unionists. It was feared that conceding home rule to Ireland would undermine the integrity of the Empire. A movement for self-government at the heart of the Empire could encourage separatist movements in the colonies. Moreover, there was the security of the British Isles to consider; ‘A home rule Ireland would become a strategic liability for London in the event of a European war’.5 A Dublin Parliament was also a threat to the landed interest, potentially enacting confiscatory policies as part of radical land reform measures. In addition, sectarianism played its part. The participation of Roman Catholic priests in the home rule movement led to claims that a Dublin Parliament would be controlled from Rome. This was unacceptable to Ireland’s Protestant Unionists.6 For the Unionists, what Ireland needed was not self-government but rather ‘resolute’ government from Westminster. This led to the dual policy of ‘coercion and conciliation’, which dominated the Conservative and Liberal Unionist approach to Ireland until they lost office in the Liberal landslide of 1906. Coercion consisted of forcing the Irish population to submit to the law, with

4

5 6

Andrew Roberts, Salisbury: Victorian Titan (London: Weidenfeld & Nicolson, 1999), 417–20; Jenkins, Gladstone, 559; and Fraser ‘The Liberal Unionist alliance’, 56, 67. John O. Stubs, ‘The Unionists and Ireland, 1914–18’, The Historical Journal, 33(4) (1990), 867–8. Roberts, Salisbury, 367, 370, and 380; and Roy Foster, Lord Randolph Churchill: A Political Life (Oxford: Clarendon Press, 1981), 252–60.

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the government passing the required legislation that would give it the powers to enforce this – most notably Arthur Balfour’s Criminal Law Amendment Act of 1887. Meanwhile conciliation represented an attempt to ‘kill home rule by kindness’. It was believed that passing local government and land reform, providing for agricultural improvement, and creating a Catholic university, would undermine support for home rule and result in an accommodation between Britain and Ireland.7 However, such an approach could never ultimately be successful. Indeed nearly 20 years of continuous ‘coercion and conciliation’ failed to settle the Irish question as the proponents of the policy had claimed it would. This is because the Conservative and Liberal Unionist approach ignored the reality of the existence and strength of Irish nationalism. In fact, over the period, increasing emphasis was instead placed on the rights of Ireland’s Unionist population, which was mainly based in the north-east of the island, not to be coerced into home rule. The Conservative governments headed by Lord Salisbury and then Arthur Balfour were able to prevent the introduction of home rule by their majorities in either the House of Commons or the House of Lords. Pressure was also eased by the split in the Irish Parliamentary Party caused by Parnell’s involvement in the O’Shea divorce case, which was in turn to limit the Irish Party’s effectiveness as an advocate of home rule. Moreover, with Gladstone’s retirement, while the Liberals maintained their commitment to home rule, it was decided by the new Liberal leadership that home rule was not to be the priority it had been in 1886 or 1892. With the landslide election victory in 1906 the Liberals were not dependent on the Irish Party’s support to remain in government and therefore could delay the introduction of a Home Rule Bill. This avoided the inevitable result of Parliament being dominated by the issue and allowed the Liberals to pursue the remainder of their legislative programme.8 The respite was brief, however, as the Irish question was soon to once again dominate Parliament’s attention. The constitutional crisis of 1909–11, as Asquith’s Liberal government battled to get its budget through the House of Lords, helped precipitate the constitutional crisis of 1912–14 over home rule. As a result of the two general elections of 1910, the Liberals lost their overall majority in the

7

8

Roberts, Salisbury, 384–5 and 442–3; R. J. Q. Adams, Balfour: The Last Grandee (London: John Murray, 2007), 80–1; and Alvin Jackson, Ireland 1789–1998: War, Peace and Beyond (Chichester: Wiley-Blackwell, 2010), 119, 147. Adams, Balfour, 80–1; Paul Bew, Ireland: The Politics of Enmity 1789–2006 (Oxford: Oxford Univer­ sity Press, 2007), 358–60; and Roy Jenkins, Asquith (London: Collins, 1964), 149.

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House of Commons and were again dependent on Irish Party votes to remain in office. The price of Irish support was home rule.9 The reaction of the Unionists – as the coalition of Conservatives, Liberal Unionists and Ulster Unionists was collectively known – was ferocious. Indeed, the period from 1912 to 1914 was to see the height of ideological Unionism. And this ideological Unionism was to help bring Ireland to the brink of civil war. Opposition to home rule was headed by the Conservative leader, Andrew Bonar Law, and the Ulster Unionist leader, Sir Edward Carson. Both were staunch Unionists and both were willing to consider extraParliamentary action, even open rebellion, in order to frustrate home rule. The vociferousness of the Unionist campaign was to demonstrate, and to contribute to, the polarization between the two sides of the dispute, leaving little room for political compromise and instead increasing the likelihood of violence. However, there had been a significant development since the previous home rule debates. As a result of the reform of the House of Lords that had followed the budget crisis of 1909–11, the Lords had lost its power of veto and could now only delay legislation for 2 years. No matter how long or arduous the Unionists made it, the Liberals would win the Parliamentary battle. Nevertheless, Bonar Law and Carson were still prepared to use every Parliamentary procedure available to them in order to filibuster and to make the pursuit of home rule expensive for the government in terms of being unable to carry the rest of its legislative programme for want of Parliamentary time.10 In opposing the Bill, Bonar Law and Carson deployed both tactical and ‘moral’ arguments. The Parliament Act, which had removed the Lord’s power of veto, was, according to the Act’s own preamble, a temporary measure designed to fill the gap until a fuller measure of reform could be achieved. According to Carson, the Constitution was in ‘suspension’ until that reform had been completed and it was necessary to resolve this constitutional issue before commencing with further constitutional innovation.11 Moreover, it was argued that before any home rule legislation was enacted it should be put to the test of a general election as it had not been the centre of the campaigns in either of the 1910 elections. This demand was based on the judgement that home rule ‘was not a winning policy   9 10

11

R. J. Q. Adams, Bonar Law (London: John Murray, 1999), 97. John Ramsden, The History of the Conservative Party: The Age of Balfour and Baldwin 1902–1940 (London: Longman, 1978), 78–80. Adams, Bonar Law, 106.

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outside of Ireland’.12 Indeed, Bonar Law had even gone as far as to recommend to the King that he dismiss his ministers in order to stop the Bill, which Bonar Law argued the Monarch was constitutionally entitled to do given that the ‘buffer’ of the House of Lords had now disappeared.13 Bonar Law and Carson’s ‘moral’ arguments against home rule lay in their opposition to what they argued would be the required coercion of Ulster in order to make home rule work. In the starkest of terms, both in Parliament and out, Bonar Law argued that any attempt to coerce Ulster would lead to civil war. And in his famous Blenheim speech of 29 July 1912, Bonar Law declared that, ‘I can imagine no length of resistance to which Ulster can go in which I should not be prepared to support them’.14 Ulster was preparing to resist and Bonar Law was pledging his support. On 28 September 1912, Carson and some 470,000 others signed the Ulster Covenant, which set out their opposition to home rule, and pledged that they would not recognize the authority of any Home Rule Parliament.15 More worrying was the creation in 1913 of the Ulster Volunteer Force (UVF), a unionist militia whose purpose was to resist home rule by force. In April 1914, a substantial quantity of arms and ammunition was smuggled into Larne, seemingly with the knowledge of Unionist leaders. In all this, there was a question as to whether the government would be able to rely on the Army to enforce home rule, especially after the Curragh Mutiny of March 1914 when Army officers had chosen to resign rather than be party to any action against Ulster.16 By the time the Bill finally passed all its Parliamentary hurdles in September 1914, it was clear that the only possibility of a compromise would be through the exclusion of Ulster from any home rule settlement. The question of what constituted ‘Ulster’ and the extent to which it could be excluded had been discussed in private meetings between Bonar Law and Asquith, but without agreement.17 Only the outbreak of war in August 1914, and the resultant decision to suspend the introduction of home rule until after the war, brought the furious debate of the Irish question to a temporary end. But the Unionist leadership, with Bonar Law foremost among them, had shown themselves to be ‘Die Hards’ 12 13 14 15

16 17

Ramsden, History of the Conservative Party, 79. Jenkins, Asquith, 278. Ibid. Graham Walker, A History of the Ulster Unionist Party: Protest, Pragmatism and Pessimism (Manchester: Manchester University Press, 2004), 34–5. Bew, Ireland, 368–70. Jenkins, Asquith, 289–97.

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for the Union, or at any rate the Union with Ulster, coming so far as to argue for Ulster’s right to take up arms to stay under Westminster’s authority. Yet the Irish question remained unresolved. And as the situation polarized even further over the course of the war, the ‘law of diminishing acceptability’ required even more radical measures to meet the changed circumstances. As a result, by 1922, the six north-eastern, mainly unionist, counties of Ireland had been granted a Home Rule Parliament based in Belfast, while the remainder of the island had been granted independence with dominion status. All this was to happen under either a Unionist-dominated coalition or a majority Unionist government. There are several reasons for this transformation in the Unionist position on Ireland. First, from 1915, the Unionists were in government and now shared the responsibility of dealing with the Irish question. This led to the gradual acceptance of those who served in government and that had to deal with the Irish question that some form of self-government was necessary. Yet, this transformation was not uniform. Opposition from several leading Unionists prevented a home rule scheme from being implemented in the aftermath of the 1916 Easter Rising – although significantly both Bonar Law and Carson backed the initiative. And it should be emphasized that the holding of office had an important influence. A large number of backbench MPs, who never held ministerial office, remained Die Hard Unionists. Moreover, following his retirement from office in  1921, Bonar Law’s ideological Unionism returned and replaced the more pragmatic Unionism he had shown while in government. In government, Bonar Law had consented to the 1916 home rule proposals and the 1920 Government of Ireland Act. However, following his retirement due to ill health, Bonar Law’s Die Hardism re-emerged, much to the annoyance of his successor, Austen Chamberlain.18 Secondly, the war had a transformative effect on how people in Britain viewed the Irish question.19 During the war, the successful prosecution of the conflict was deemed to be more important than the Union with Ireland.20 It was also believed that the strong public support the Unionists had enjoyed in Britain for their position in Ireland before the war no longer remained. In any event, it would

18

19

20

Stubs, ‘The Unionists and Ireland’, 867; Alvin Jackson, Home Rule: An Irish History, 1800–2000 (London: Weidenfeld & Nicolson, 2003), 155; Adams, Balfour, 313; and David Dutton, Austen Chamberlain: Gentleman in Politics (Bolton: Ross Anderson, 1985), 170. D. G. Boyce, ‘British Conservative opinion, the Ulster question, and the partition of Ireland, 1912– 21’, Irish Historical Studies, 17(65) (1970), 98. Adams, Balfour, 313.

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be better for Parliament to be dominated by issues surrounding reconstruction following the war than yet more wrangling over Ireland.21 Events in Ireland also pointed to the requirement for a new constitutional settlement. The Easter Rising had been followed by a radicalization in Irish nationalism. Calls for home rule were replaced by calls for an independent Irish republic. Home rule nationalists were displaced by Sinn Féin republicans. Furthermore, the massive increase in violence from 1919 made it clear that the only alternative to a political settlement would be the outright repression of the southern counties. Such an approach would not gain support of politicians or public in Britain.22 An important qualification to all this, though, is that the Unionists’ more pragmatic stance was contingent on a special provision being made for Ulster. This became an accepted element in the attempts to find an answer to the Irish question. In October 1919, the Prime Minister, David Lloyd George, appointed a Cabinet committee to consider a political settlement for Ireland. Lloyd George astutely appointed Walter Long, a leading Unionist, to chair the committee. A month later, in November 1919, Long’s committee reported, recommending the creation of two Irish Parliaments, one in Belfast to govern Ulster and one in Dublin responsible for the rest of Ireland. To encourage the eventual unification of these Parliaments, a Council of Ireland would be established, with its membership drawn equally from the two Parliaments. In less than a decade, the Unionists had travelled from being Die Hard opponents of home rule to introducing two Parliaments in Ireland. Initially Long had recommended that the whole of Ulster should come under the authority of the Belfast Parliament as this would give Northern Ireland, as it was called, a more balanced population between unionists and nationalists. However, concerned that this did not given them a guarantee of permanently remaining in the United Kingdom, the Ulster Unionists persuaded Long that only six counties should be included in Northern Ireland. Long, in turn, persuaded the Cabinet, and the Unionists in Parliament accepted this also. The seeds for the permanent division of Ireland were sown by the creation of a Parliament that the Unionists initially had opposed the creation of and which Irish nationalists continued to oppose.23

21 22

23

Boyce, ‘British Conservative opinion’, 98; Dutton, Chamberlain, 141. John D. Fair, ‘The Anglo-Irish treaty of 1921: unionist aspects of the peace’, Journal of British Studies, 12(1) (1972), 135. Richard Murphy, ‘Walter Long and the making of the Government of Ireland Act, 1919–20’, Irish Historical Studies, 25(97) (1986), 82–8.

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Even more radical measures were required, however, for southern Ireland. While the North was now willing to submit to home rule, the situation had deteriorated rapidly in the rest of Ireland. At the December 1918 general election the old home rule supporting Irish Parliamentary Party was reduced to just six seats in the House of Commons, with Sinn Féin displacing them, winning 73 seats, on a manifesto calling for an independent Irish republic. In January 1919, rather than travelling to London to take their seats, the newly elected Sinn Féin members gathered in Dublin to form their own Parliament – Dáil Éireann. While the Dáil sought to usurp political power, the Irish Republican Army (IRA) commenced a guerrilla war against the British presence in Ireland. In response, the British adopted increasingly repressive policies, and so the descent into violence began.24 As the policy of coercion was failing to pacify Ireland and as Long’s dual devolution legislation was simply ignored in the South, the British government eventually recognized that it would have to negotiate with Sinn Féin. In so doing the government was aware that it would have to produce a political solution that could command the support of a majority of Unionist MPs in the House of Commons. This Lloyd George did with an agreement that gave 26 counties of Ireland independence with dominion status, which retained its Commonwealth connection, recognized the British Crown as head of the Commonwealth, and conceded to the Royal Navy certain bases that were deemed by the British to be strategically significant. Ironically, given his return to Die Hardism during his brief stay on the backbenches, it was a majority Unionist government led by Bonar Law that was to implement the agreement.25 With the Anglo-Irish Treaty signed on 6 December 1921 and coming into force a year later, the Irish question appeared to have been resolved. The Conservatives and Unionists had campaigned over 35 years against home rule and even endorsed armed rebellion against it. In government from 1915, however, the Unionists had been forced to recognize the realities of the situation in Ireland. The ideological, obstructive, Unionism of the anti-home rule campaign had slowly given way to a more pragmatic Unionism that had allowed for the development of a political settlement, albeit an imperfect one. With the advent of the ‘Troubles’, pragmatic Unionism was to be the dominant strand of the

24

25

Richard English, Armed Struggle: The History of the IRA (London: Pan Books, 2004), 15–20; and Bew, Ireland, 397. Fair, ‘The Anglo-Irish treaty’, 141–4.

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Party’s approach to the part of Ireland that remained part of the UK. However, Die Hard ideological Unionism did not disappear completely in 1922.

The Troubles Prior to the outbreak of the Troubles in August 1969, Irish affairs had only intermittently needed to be addressed by British politicians at Westminster. While Northern Ireland remained part of the UK, it enjoyed considerable autonomy through its home rule Parliament based at Stormont. Northern Ireland’s politics had been dominated by the Ulster Unionists since partition, with the Unionists permanently in government. Discrimination against the minority, mainly Roman Catholic, nationalist population over this period led to the development in the late 1960s of a civil rights movement to demand equal rights for the minority. Rather than being seen for what it was, the authorities at Stormont viewed the civil rights activists as subversives who were in fact attempting to force Northern Ireland into a united Ireland. This led to a violent crackdown by the Northern Irish state, further polarizing the attitudes in both the nationalist and unionist communities. The situation deteriorated rapidly. With Northern Ireland seemingly on the brink of civil war, after days of intercommunal violence in August 1969, Harold Wilson’s Labour government was forced to send British troops into the Province in an attempt to restore order. But, by now, the polarizing of opinions had pushed radical elements in the minority community once again to take up arms, leading to the rise of the Provisional Irish Republican Army (PIRA) which soon began its war to unite Ireland. It is possible to see British government policy, both Conservative and Labour, towards Northern Ireland through the ‘coercion and conciliation’ paradigm of the home rule era. Special judicial measures were introduced for dealing with suspected terrorists, while the British Army was active on the streets of the Province carrying out door-to-door searches in nationalist areas and interning suspected PIRA terrorists or even enforcing an alleged ‘shoot to kill’ policy against PIRA members.26 To an extent, there is something to this. But it should not be taken too far. The overall approach of British governments and the motivations behind their policy towards Northern Ireland must also be taken into account. 26

Caroline Kennedy-Pipe, The Origins of the Present Troubles in Northern Ireland (London: Longman, 1997), 49–121.

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For its part, the Conservative Party was still instinctively Unionist. Ulster Unionist MPs took the Conservative whip at Westminster. Lord Hailsham, who served as Lord Chancellor in both the Heath and Thatcher governments, even hankered for the return of the Republic of Ireland to the Union, although he recognized that this was not practicable in the foreseeable future.27 There was also a vocal group of Die Hard Unionists on the Conservative backbenches. Chief among them was Enoch Powell, whose growing estrangement from the party was soon to see him returned to Parliament as an Ulster Unionist representing a Northern Irish constituency.28 That left behind a small but determined Die Hard caucus in the Conservative Parliamentary Party.29 However, the general trend within the Conservative Party was towards a pragmatic Unionism that expressed a preference for Northern Ireland to remain a part of the UK while leaving the Province’s constitutional future in the hands of its population. Initially, on its return to power following the June 1970 general election, the Conservative Party’s policy towards Northern Ireland was woefully inadequate. The policy inherited by Edward Heath was that of forcing Stormont to remove the discriminatory practises that operated against the minority while leaving the 1920 constitutional settlement unchanged. However, Heath and his Home Secretary, Reginald Maudling, failed to critically engage with Northern Ireland or its problems and instead gave the Army considerable latitude in its operations and effectively ceded control of security policy to Stormont.30 This resulted in a Die Hard policy being adopted almost by default. Significant errors in this policy, such as the Falls Road Curfew of July 1970 and the introduction of interment without trial in August 1971, only added to the anger and alienation of the nationalist minority and led to further violence.31 The terrible events of Bloody Sunday, 30 January 1972, when 13 Catholic civilians were shot dead by the British Army following a civil rights march in Derry, forced the Heath government to consider a more radical approach to Northern Ireland. Wilson’s ‘law of diminishing acceptability’ again came into operation, rendering any tinkering with the Stormont system inadequate in meeting the prevailing conditions in the Province. In considering a political 27

28 29 30 31

Paul Arthur, ‘The Heath government and Northern Ireland’, in S. Ball and A. Seldon (eds), The Heath Government 1970–1974: A Reappraisal (London: Longman, 1996), 239–40; and Lord Hailsham, The Door Wherein I Went (London: Collins, 1975). Robert Shepherd, Enoch Powell: A Biography (London: Pimlico, 1996), 452–5. D. McKittrick, ‘Voices from the far right’, Fortnight, 193, 1983, 4–5. Kennedy-Pipe, Origins of the Present Troubles, 49–52 and 62–5. John Peck, Dublin from Downing Street (Dublin: Gill and Macmillan, 1978), 49–50.

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initiative it was taken for granted in the British government that having some form of devolved administration in Belfast was desirable. The question that occupied ministers was what form this devolved administration should take and whether it could be achieved without a period of Northern Ireland being directly ruled from Westminster. Even before the events of Bloody Sunday, Maudling had concluded that a period of direct rule would be desirable.32 His Cabinet colleagues were not convinced, however. Instead, a compromise was reached whereby the Prime Minister of Northern Ireland, Brian Faulkner, would be told that Stormont was being stripped of its law and order and security powers. If Faulkner rejected this proposal and resigned, then direct rule would be introduced as there was no alternative to Faulkner that London would find acceptable. As Maudling and Heath had expected, Faulkner did indeed reject the proposal.33 Heath announced to the House of Commons on 24 March 1972 that direct rule was to be introduced and that his close Cabinet ally William Whitelaw would be appointed as the first Secretary of State for Northern Ireland.34 Direct rule was not a solution, but rather was intended to give the Heath government space in which to develop a political initiative. In the process of developing this initiative, Heath and Whitelaw were to develop a number of principles that were to form the basis of future British attempts to end the Northern Ireland conflict. First, the permanent exclusion of the minority from power in Northern Ireland had to end. Instead, a future devolved government would have to be shared between the two communities. Second, the interconnections between Northern Ireland and the Republic of Ireland had to be recognized and the Dublin government would have to be involved. This was necessary for any settlement to be acceptable to the minority. In addition, the British hoped that bringing Dublin into the process would make the Republic’s government more open to cooperating on security matters with Britain. This would help prevent the PIRA from mounting operations into Northern Ireland from the South. Finally, the British government had to declare its ‘neutrality’ as to the constitutional status of Northern Ireland. So long as the majority of the population of Northern Ireland wanted to remain part of the UK, it would do so. If in the future a majority wanted to unite with Dublin, then the British government would facilitate this. Dublin wanted the British government to 32

33 34

National Archives (hereafter NA), CAB 130/522, GEN 47(72)1, ‘Northern Ireland – Policy for 1972’, 18 January 1972. NA, CAB 128/48, CM (72) 15th Conclusions, Confidential Annex, 14 March 1972. House of Commons Debates, 5th Series, vol. 833, cc. 1859–74.

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become a persuader of Irish unity. This the British refused, as to do so would merely forfeit the confidence of the unionist population. In turn, the British wanted the Irish government to repeal the irredentist Articles in the Republic’s Constitution. This the Irish rejected, arguing that the nationalist aspiration for Irish unity was as legitimate as the Unionist desire to remain in the UK.35 However, the Conservative Party’s new ‘neutrality’ on the constitutional status of Northern Ireland, the imposition of direct rule, the advocacy of crosscommunity power-sharing and the concession that the Irish government had a role to play in Northern Ireland, was too much for the Province’s unionist population. Although in November 1973 an agreement was reached on forming a power-sharing executive between a group of moderate Unionists, led by Brian Faulkner, the main constitutional nationalist party, the Social Democratic and Labour Party (SDLP), and the cross-community Alliance Party, the majority of the unionist electorate had supported parties opposed to power-sharing. The breaking point, though, was the Sunningdale Agreement of December 1973, reached between the British and Irish governments and the new powersharing executive. Part of the Agreement provided for the creation of a Council of Ireland to institutionalize the relationship between Belfast and Dublin. The idea of a Council of Ireland had been rejected by the Unionists in 1920 and was rejected again in 1974 as it was seen as nothing other than a backdoor device for forcing Northern Ireland into a united Ireland. In May 1974, a 2-week general strike led to the collapse of the power-sharing executive and the Sunningdale Agreement.36 Taking a pragmatic Unionist approach to Northern Ireland ended the Conservative-Ulster Unionist alliance that had been forged in the campaign against home rule. This had serious political consequences for the Heath government. According to John Campbell, ‘The enmity of the Ulster Unionists cost Heath his majority in February 1974 . . . the suspension of Stormont led directly to the downfall of his government’.37 Within the Conservative Party itself, only a handful of Die Hards were active on the backbenches. But they were not willing to take their opposition to the Party’s Northern Ireland policy into any general rebellion against the Party leadership. With the exception

35

36 37

Alan MacLeod, ‘The United Kingdom, Republic of Ireland, United States and the Conflict in Northern Ireland, August 1971–September 1974’, unpublished PhD thesis, 2012, University of Glasgow. Ibid. John Campbell, Edward Heath: A Biography (London: Pimlico, 1994), 434.

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of Powell, they remained loyal to the Party. Indeed, the Cabinet’s reluctance to introduce direct rule in March 1972 proved the high point of resistance to pragmatic Unionism. A Die Hard approach was indeed open to the Heath government. Faulkner had urged such an approach on Heath in October 1971, recommending an all-out military campaign against the PIRA. But Heath had rejected such a move, recognizing that it would merely destroy any chance of reaching an accommodation with moderate nationalists or with the Dublin government without necessarily defeating the Provisionals.38 This is a lesson that had been learnt at some expense by Conservative leaders in the Anglo-Irish War of 1919–21. The collapse of the Heath government’s Northern Ireland initiative came just months after the Conservative Party had lost the February 1974 general election. After a second defeat in October 1974, moves were started to eject Heath from the Party leadership. In February 1975, Heath was succeeded as Tory leader by Margaret Thatcher. Thatcher was a staunch Unionist – a Die Hard. In her memoirs she declared that ‘any Conservative should in his bones be a Unionist too’.39 That said, Thatcher’s idiosyncratic approach to government meant that there was little consistency in her approach to Northern Ireland. This was important given the personal influence she exerted on all aspects of her government’s policy. As Hugo Young puts it: What she supported tended to happen. What she neglected or opposed tended not to happen. What she permitted, but did not support, might happen, but only in a context where she had openly distanced herself from the consequences and therefore assisted in the enfeeblement of what she allowed others to do. All the stances were visible at one time or another in her attitude to Northern Ireland.40

This inconsistency led to her being ambivalent towards, or even in one case actively undermining, the policies of her Northern Ireland Secretaries out of concern for Unionist sensibilities while simultaneously concluding the AngloIrish Agreement which was to enrage the Ulster Unionists. In opposition, Thatcher had appointed Airey Neave as Shadow Northern Ireland Secretary. Neave, who had famously escaped from the Colditz prison camp during World War II and had recently masterminded Thatcher’s leadership 38 39 40

NA, CAB 130/522 GEN 47(71) 5th Meeting, 6 October 1971. Margaret Thatcher, The Downing Street Years (London: HarperCollins, 1993), 385. Hugo Young, One of Us: A Biography of Margaret Thatcher (London: Pan Books, 1991), 464.

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campaign, shared the Die Hard views of his leader. While power-sharing and the Irish dimension remained the party’s official policy, Neave struggled to toe the party line. Instead, Neave believed that a strong security policy aimed at militarily defeating the paramilitaries should take precedence over any political initiative.41 This was the classic Die Hard policy towards Ireland. However, this approach caused deep concern in the Irish government and also among Neave’s Shadow Cabinet colleagues, most notably William Whitelaw.42 An attempt was made to rein in Neave, but the Conservative Party went into the 1979 general election with a policy advocating strong security measures while making no commitment to a wider political initiative. Events intervened, however, as Neave was assassinated on the eve of the election by the Irish National Liberation Army (INLA). Instead it was to be Humphrey Atkins who was to be appointed Northern Ireland Secretary. Both Atkins and his successor, Jim Prior, took a very different approach to Northern Ireland from that of Neave. Certainly the Thatcher government pursued an active, and often controversial, security policy in Northern Ireland, continuing the use of Special Forces started by the previous Labour government and with consistent allegations of there being a ‘shoot to kill’ policy against the paramilitaries.43 In addition, the Republican hunger strikes of 1980–81 were ruthlessly faced down and later Sinn Féin voices were to be banned from television and radio. Nevertheless, Thatcher’s Northern Ireland Secretaries were largely drawn from the moderate wing of the Party – those she dismissively dubbed ‘wets’. These ‘wet’ ministers attempted to develop political initiatives aimed at bringing together the two communities in Northern Ireland – initiatives the Prime Minister had little time for. Within months of the general election, Atkins effectively ditched the party’s manifesto on Northern Ireland and instead brought forward proposals for allparty talks on the future political arrangements for the Province. At these talks it was hoped that some form of devolution could be devised that would gain the general agreement of the Province’s politicians. While Ian Paisley’s Democratic Unionist Party (DUP), the SDLP and the Alliance Party took part, the process was handicapped by the refusal of the Ulster Unionists to participate. The

41

42 43

Paul Routledge, Public Servant, Secret Agent: The Elusive Life and Violent Death of Airey Neave (London: Fourth Estate, 2002), 284. Ibid., 284–6. Jonathan Tonge, Northern Ireland (Cambridge: Polity Press, 2006), 74–5.

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initiative quickly stalled and the momentum was lost as the government faced the Republican hunger strikes.44 Atkins was replaced in September 1981 by Jim Prior. Prior proved an energetic Secretary of State and quickly developed a scheme for ‘rolling devolution’. A Northern Ireland Assembly was to be elected on similar lines to that of the Heath era, but it would not have executive or legislative powers. Instead it would monitor the operation of the Northern Ireland government departments. If, over time, agreement could be reached for the basis of a power-sharing administration, then power would be devolved from Westminster. If the parties could only agree to cooperate on certain topics, like agriculture, commerce or the environment, then only those powers would be devolved. Over time, this could lead to full devolution and power-sharing.45 This initiative failed. Both Atkins’ and Prior’s initiatives came to nothing because of the prevailing conditions in Northern Ireland. Moreover, Atkins’ initiative was overshadowed by the hunger strikes, while Prior’s was overshadowed by the start of the Falklands War. Yet, both these initiatives were seriously handicapped by the antipathy of the Prime Minister. Thatcher was unwilling to expend any of her own time or political capital in actively supporting her Northern Ireland Secretaries. In her memoirs, Thatcher described Atkins’s initiative as ‘worth the effort’.46 However, she was conceding only that it was worth Atkins’s effort, not her own. Clearly the Prime Minister did not believe that the initiative would succeed and was unwilling to exert any effort in order to improve its chances.47 With regard to Prior’s initiative, it is clear that Thatcher’s personal animosity combined with her instinctive Unionism to lead the Prime Minister to actively undermine her own government’s policy.48 Attacks by the small group of Die Hard MPs, who were augmented by three junior members of the government who resigned in protest over Prior’s initiative, were compounded by the actions of Ian Gow, Thatcher’s Parliamentary Private Secretary. Gow, a Die Hard who was to fall victim to the PIRA in 1990, helped undermine the proposals by telling right-wing MPs and the Ulster Unionists that the Prime Minister did not support the measure.49

44 45 46 47 48 49

Shepherd, Enoch Powell, 480–1; and C. MacNee, ‘Atkins’ Initiative’, Fortnight, 174 (1980), 2. James Prior, A Balance of Power (London: Hamish Hamilton, 1986), 194–201. Thatcher, The Downing Street Years, 387. Ibid., 386–8. Young, One of Us, 467–8. Prior, Balance of Power, 198–9; and Thatcher, The Downing Street Years, 394.

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Thatcher had personally intervened to excise from Prior’s proposals a section dealing with the ‘Irish dimension’. She later explained that the purpose in doing this was to minimize Unionist objections to the initiative.50 This is particularly ironic given that Thatcher was herself to embark on a course that was to lead to the granting of an institutionalized role for the Irish government over Northern Ireland’s affairs and which was to be furiously rejected by Ulster’s Unionist politicians. Several reasons prompted Margaret Thatcher to enter negotiations with the Irish government. According to Thatcher, her main aim was to gain greater cooperation from the Irish on security issues.51 Geoffrey Howe also attributed the entry of Sinn Féin into electoral politics and the possibility of them displacing the moderate SDLP as a factor.52 American pressure was also important. There were two strong strands in Thatcher’s politics, her Atlanticism and her Unionism. Where these two came into conflict, her Atlanticism won.53 The Agreement was signed on 15 November 1985. It started with similar declarations on the status of Northern Ireland depending on the consent of the people of the Province as had been contained in the Sunningdale Agreement. Its most important sections, though, gave the Irish government a right to be consulted and also to propose legislation to the British government on internal Northern Irish issues or on relations between the North and the South. However, in the event of the creation of a power-sharing executive in Northern Ireland, the areas of responsibility devolved to it and to a new Assembly would then fall out of the scope of the Agreement. In other words, if the Unionists wanted to exclude the Irish government from Northern Ireland’s affairs the only way to do it was to enter into a power-sharing agreement in a devolved executive.54 Unionists were outraged by the Agreement. As it had been negotiated in secret without the involvement of any of the Unionist parties, the Agreement opened the door to all sorts of conspiracy theories of secret deals being done to bounce the Unionists into a united Ireland. Secondly, there was a deep anger at Dublin being given a right to participate in the politics of Northern Ireland. In protest, all of Northern Ireland’s Unionist MPs resigned their seats to force

50 51 52 53

54

Thatcher, The Downing Street Years, 394. Ibid., 395. Geoffrey Howe, Conflict of Loyalty (London: Politicos, 2008), 415. Adrian Guelke, ‘The United States, Irish Americans and the Northern Ireland peace process’, International Affairs, 72(3), 1996, 531–2; and John Campbell, Margaret Thatcher Volume Two: The Iron Lady (London: Vintage, 2008), 230. CAIN Web Service (2012), ‘Anglo-Irish Agreement – Description of Contents’, http://cain.ulst. ac.uk/events/aia/describe.htm, accessed April 2012.

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by-elections that could be portrayed as a referendum on the Agreement. With one exception, all were returned to Parliament.55 Regardless of Thatcher’s later ambivalence, the Anglo-Irish Agreement was a significant step. Although the conflict was to continue, with many bloody episodes to come, the Anglo-Irish Agreement did facilitate better interaction between the British and Irish governments over Northern Ireland and this was to prove valuable in developing the peace process that led to the Good Friday Agreement of April 1998.56 In signing the Agreement, Thatcher had done no more than her Die Hard predecessors had while in government, by recognizing the reality of the situation and pragmatically trying to address it. Where she differed from her predecessors was in her idiosyncratic style of kneecapping her Cabinet colleagues while they made their own attempts to address the conflict. Thatcher’s last important act with regard to Northern Ireland was to appoint Peter Brooke, another moderate patrician Tory, as Secretary of State in July 1989. Brooke was to be retained in this post by Thatcher’s successor as Conservative leader and Prime Minister, John Major. From the start of his premiership, Major made Northern Ireland one of his main priorities.57 This was significant. Intensive constructive prime ministerial engagement with Northern Ireland and its problems was to largely succeed where the transient attention of Thatcher had largely failed. Major worked closely with Brooke until the 1992 general election, after which Sir Patrick Mayhew was appointed Northern Ireland Secretary. Between them, these three moderate Conservatives embarked on a course that owed much to the pragmatic approach of the post-1972 Heath government’s policy. And although it did not lead to agreement during Major’s premiership, the peace process they developed contributed significantly to the eventual signing of the Good Friday Agreement. On 26 March 1991, Brooke announced in the House of Commons the government’s three-stranded approach to political talks. Strand 1 would consist of talks between Northern Ireland’s constitutional parties, excluding Sinn Féin due to its links with the IRA. Strand 2 would consist of talks on the relationship between the two parts of Ireland, while Strand 3 related to Anglo-Irish relations.58 This comprehensive approach echoed the Heath government’s attempts to solve

55 56

57 58

Shepherd, Enoch Powell, 492–3. C. Norton, ‘Renewed hope for peace? John Major and Northern Ireland’, in P. Dorey (ed.), The Major Premiership: Politics and Policies under John Major, 1990–97 (London: Macmillan, 1999), 109–11. Anthony Seldon, Major: A Political Life (London: Phoenix, 1998), 134. House of Commons Debates, 5th Series, vol. 188, cc. 765–6, 26 March 1991.

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the conflict and contrasted with the Thatcher government’s incoherent policy that had lacked any overall objective. And by the early 1990s new circumstances made such an approach more likely to succeed. First, there was movement in the position of the Unionists who now acknowledged that there would need to be some form of Irish dimension, although the form this should take was the cause of intensive debate.59 In addition, Major was more willing to work closely with the Irish government than his predecessor had been. He enjoyed a particularly close working relationship with the Irish Taoiseach Albert Reynolds from 1992 to 1994. Thirdly, while the British government restated its neutrality on the constitutional question, the Irish government also began to move in this direction. The Downing Street Declaration of December 1993 contained a far more comprehensive Irish statement on Northern Ireland’s status and as part of the Good Friday Agreement the two irredentist clauses were removed from the Republic’s Constitution. However, the most significant difference with past attempts at bringing peace to Northern Ireland was the Major government’s attempts to bring the paramilitary groups into political talks. In late 1990 a secret line of communication was established between the British government and the Provisional IRA. It was through this channel that in February 1993 the British received a message in which the Provisionals declared its wish to end its war.60 The Sinn Féin President, Gerry Adams, and the SDLP leader, John Hume, had been in dialogue since 1988 and it appeared from this that there was the growing potential of the paramilitaries ending the conflict and entering talks with the two governments and constitutional parties. As part of the British government’s attempts to demonstrate their neutrality on the constitutional question, Peter Brooke, at John Hume’s urging, had declared that ‘The British government has no selfish strategic or economic interest in Northern Ireland . . . Britain’s purpose . . . is not to occupy, oppress or exploit’.61 This was then built on in the text of the Downing Street Declaration. Before Sinn Féin could enter into constitutional talks, though, the IRA’s campaign of violence had to be brought to an end and its weapons decommis­ sioned. In August 1994 the IRA declared a ceasefire, which was followed weeks later by a similar declaration from the Loyalist paramilitaries. Yet in

59 60 61

Norton, ‘Renewed hope for peace?’, 112. John Major, John Major: The Autobiography (London: HarperCollins, 2000), 431. Seldon, Major, 264.

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the Downing Street Declaration both the British and Irish governments had stated that before Sinn Féin could enter into talks the IRA would have to decommission its weapons. This was to prove the main obstacle to the peace process progressing. By mid-1995 the position of the two governments had begun to soften and it instead became the British view that the IRA would have to make a gesture towards decommissioning before it would enter into talks. This was later to soften again, with Major calling for decommissioning during talks.62 However, the IRA refused to decommission any weapons in advance of a settlement. Having failed to quickly secure a place in talks, the IRA ended its ceasefire in February 1996, detonating a massive bomb at Canary Wharf in London, killing two people.63 The peace process did not recover from this blow and it was Major’s successor, Tony Blair, who was to work with his Irish counterpart, Bertie Ahern, to steer the parties to the Good Friday Agreement. In his memoirs, Major is generous in his tribute to his successor, recognizing that Blair was ‘unencumbered by the baggage one collects in years of negotiation, and was therefore better able to show tactical flexibility’.64 This ‘tactical flexibility’ was allowing Sinn Féin into the talks process without decommissioning having taken place. However, Major was only able to develop the peace process by taking his pragmatic line on Northern Ireland, emphasizing that the British government had no selfish interest in the Province and that it was up to the people of Northern Ireland to decide their own constitutional future. Adopting a Die Hard approach would never have allowed for the initiative to develop, but rather would have been destructive and contributed to yet more violence. The emphasis was now on the Conservative Party’s preference, rather than insistence, that Northern Ireland remain in the Union.

The future? The Good Friday Agreement did not mark the end of the Troubles. Rather it signalled the end of the violent phase of the conflict, as its participants opt for political rather than violent methods to achieve their aims. For British

62 63 64

English, Armed Struggle, 325–7. Norton, ‘Renewed hope for peace?’, 124. Major, Autobiography, 493.

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politicians the question now is how they will relate to Northern Ireland in the new conditions created by the peace process. Of the political parties in Northern Ireland, the Ulster Unionists have suffered the most for their participation in the peace process. They have now been overtaken by the DUP as the largest unionist party in Northern Ireland and at the 2005 general election were reduced to holding just one seat at Westminster. Meanwhile, the Conservatives have struggled to win seats outside of England. The combination of these factors led to an agreement in advance of the 2010 general election that the Conservatives and Ulster Unionists should join forces as the Ulster Conservative and Unionist Party – New Force. This decision proved disastrous as the Ulster Conservatives won no seats at the general election. Lady Sylvia Hermon, the Ulster Unionist’s sole Westminster MP, had tended to vote with Labour rather than with the Conservatives and broke with her party as a result of the alliance. She was re-elected in 2010 as an independent, defeating the Ulster Conservative candidate in the process. Since the election, the Conservative Party has moved to establish its own organization in Northern Ireland, although some form of future Conservative-Unionist cooperation has not been finally ruled out.65 This attempt to re-establish the Conservative-Ulster Unionist link is a reflection of just how much Northern Ireland’s politics have changed since the Good Friday Agreement. Such a venture was unthinkable prior to the Agreement – to all, that is, except the Die Hard Conservatives. Yet, as the Conservatives develop their new organization in Northern Ireland, the lesson of history is clear. Where the party has been dominated by the Die Hard Unionism of its right-wing, it has done considerable damage in Ireland. However, where the party has actively and pragmatically engaged in Northern Ireland, declaring its neutrality on Ireland’s constitutional future while expressing its preference for the Union, the party has tended to assist in bringing political development, but at some political cost to itself.

65

A. Charles, ‘Convenience Marriage’, Fortnight, 461, 2008, 14; C. McGimpsey, ‘Marriage of convenience or despair?’, Fortnight, 463, 2008, 8–9; Daily Telegraph, ‘David Cameron launches biggest Conservative shake-up for decades’, 23 July 2008; and BBC, ‘What now for the Ulster Unionist and Conservative relationship?’, 5 October 2011, http://www.bbc.co.uk/news/uk-northern-ireland15173000, accessed April 2012.

Section Three

Looking Beyond Westminster

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5

Machinations of the Centre-Right and British Engagement with the Pan-European Ideal, 1929–48 Richard Carr and Bradley W. Hart

As John Major’s government was negotiating Britain’s position regarding the Maastricht Treaty in the early 1990s, former Labour Minister Merlyn Rees reminisced that ‘the conflict of views about going into Europe, which was led by men whom I respected such as Ernest Bevin, Attlee and Churchill, was not because they were evil men but because they came from a generation when going into Europe and eschewing the open sea was something that they could not comprehend.’1 Such an implicitly pro-European comment seems broadly indicative of the political mores of the 1990s and 2000s, with Labour opposing the British opt-out from the social chapter at the time of Rees’ speech and reversing Major’s decision in that regard almost immediately upon coming to power in 1997. Yet it also is suggestive of views towards Britain’s past: not only were politicians during the first half of the twentieth century somehow ignorant of matters European, they could not even contemplate turning their attentions from the Empire and fully engaging with the continent. The purpose of this section is to challenge such assumptions by placing Anglo-European, rather than imperial or Anglo-American, dialogue centre stage and by examining the views of Conservative political figures towards Europe in the first half of the twentieth century. Accordingly, this section argues that there is a wider, more nuanced pedigree for pan-Europeanism in Great Britain, particularly among centre-right figures

1

House of Commons, 21 November 1991, Parliamentary Debates, Commons, 6th Series, vol. 199, col. 474.

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at the heart of the Conservative Party, than hitherto always acknowledged  – especially, as Keith Robbins suggested, in the high politics of the 1929–45 period.2 While the pan-European leanings of liberal and leftist groups such as Gilbert Murray’s League of Nations Union (LNU), and the International Federation of League of Nations Societies, enjoyed far greater popular support than the limited figures on the centre-right traced here, the various European movements between the wars do allow for a more elite-driven narrative than other aspects of contemporary policy making.3 If, by 1931, the LNU had over 400,000 members compared with the paltry figures mustered by the groups delineated in what follows, it must be noted that this hardly translated into a massively more pro-active and positive stance from the British Government towards either the League or the pan-European ideal.4 The point here is that the groundwork was being laid for the terms of Britain’s post-war engagement (or lack thereof) with the European continent that deserves further acknowledgement. The centre-right’s relationship with Europe, and what this meant for Britain per se, is, at times, an ambiguous story, but with post-1945 politics in mind, one worth exploring. Unlike British historians, Continental historians have paid significant and continued attention to individual politicians’ engagement with Europe. Dina Gusejnova’s doctoral work on The Crisis of Nobility and the idea of Europe in Germany and Austria ably presents three German speaking aristocrats – Richard Coudenhove-Kalergi, Harry Kessler and Herman Graf Keyserling – as evidence of an undercurrent of pan-Europeanism among central European elites.5 Coudenhove-Kalergi has been subjected to two recent biographical studies in German, while Luisa Passerini’s study on Imagination and Politics Between the Wars and Andrea Bosco’s work on The Federalist Debate in the United Kingdom are rare English language analyses of this interesting figure.6 Elsewhere, biographies have appeared on Otto von Habsburg – a prince turned post-war MEP – and

2

3

4

5

6

See the very brief review K. Robbins, ‘Britain and European Unity 1945–92 by John W. Young’, English Historical Review, 111 (1996), 1035–6 for these points. Maurice Cowling’s work on the machinations of the political elites and the 60 or so politicians ‘who really mattered’ is still debated today: R. Crowcroft, ‘Maurice Cowling and the Writing of British Political History’, Contemporary British History, 22 (1998), 279–86. J. P. Baratta, Politics of World Federation: From world federalism to global governance (New York, 2004), 74. D. Gusejnova, The Crisis of the Nobility and the idea of Europe in Germany and Austria 1918–1939, Cambridge PhD thesis (2009). L. Passerini, Europe in Love, Love In Europe: Imagination and Politics Between the Wars (New York, 1999) and A. Bosco, Federal Union and the Origins of the ‘Churchill Proposal’: The Federalist Debate in the United Kingdom from the Munich Debate to the Fall of France, 1938–1940 (London, 1992).

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von Keyserling.7 All these works, though informative in their own right, skirt over the connections between such interwar pan-Europeanists and the British centre-right, preferring to focus almost wholly on matters continental. While Helen McCarthy has illustrated how the LNU could be a focal point for internationalists on the left and centre-left, and Edward McNeilly – moving the story back – has shown that Labour was a less parochial force prior to 1914 than previously argued, historians have been more reluctant to probe right-leaning Liberal, and (arguably small ‘l’ liberal) Conservative thought.8 Philip Coupland has viewed the question through a religious prism, but the high-level (or at least middle-level) politics of the centre-right remains underanalysed.9 This is in need of some correction for two main reasons. First, the more progressive Tory members in the post-1945 epoch were demanding ‘an Imperial-European marriage,’ which was a key facet of pan-European thought in the 1930s. It was seen as ‘the one new idea which provides hope of an ultimate solution – of standing on our own feet, instead of grovelling for charity [from the United States of America]’.10 ‘It appeals,’ wrote Harold Macmillan to Winston Churchill, ‘to traditional Conservative loyalties [and] it appeals to the great body of “liberal” and idealist opinion.’ Indeed, the pan-European movement was a symptom, as Macmillan’s comment hinted at, for Conservative and Liberal ideological fusion in the 1930s, both in personnel and in theoretical terms. Churchill may have been a rather unusual Liberal turned Tory, but Lord Layton and Andrew MacFadyean from the liberal side, and Alfred Duff Cooper, Duncan Sandys and Leo Amery from the Tories, stood as further examples whereby the European ideal could unite members of the political centre and right. That the LNU engaged with the more progressive young Tories will also, therefore, be noted – for onto such a centrist, at least nominally non-party, platform did Stanley Baldwin pitch the Conservative appeal in the 1920s, and National Government in the 1930s.11 These continuities, particularly in the imperial sphere, are worth teasing out.   7

  8

  9

10

11

G. Brook-Shepherd, Uncrowned Emperor: The Life and Times of Otto von Habsburg (London, 2003) surveys the career of a Prince turned MEP, and J. P. Boyer, Hermann von Keyserling: le personage et l’oeuvre (Lille, 1979). H. McCarthy, ‘Parties, voluntary associations, and democratic politics in interwar Britain’, Historical Journal, 50 (2007), 891–912, and E. McNeilly, ‘Labour and the Politics of Internationalism, 1906–14’, Twentieth Century British History, 20 (2009), 431–53. P. M. Coupland, Britannia, Europa and Christendom: British Christians and European Integration (Basingstoke, 2006). Macmillan note, previously sent to Churchill, copied to Sandys, 3 October 1949, The Papers of Duncan Sandys, DSND 9/3/2, C[hurchill] A[rchives] C[entre]. Explored, most fully, in P. Williamson, Stanley Baldwin: Conservative Leadership and national values (Cambridge, 1999).

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The second main purpose of this analysis lies in the contention that surveying the dialogue of Coudenhove-Kalergi with prominent British figures provides an insight into the type of European unity politicians of the centre-right were envisaging in the 1930s, and also helps explain Labour’s reluctance to engage with the concept after 1945. This was pan-Europeanism, but not necessarily of a type palatable to the left. The Labour case, it will be argued, was based upon a rational fear of both the Coudenhove-Kalergi type of European aristocrat and the more middle class capitalist types with whom he was purportedly in cahoots. That Coudenhove-Kalergi dealt almost entirely with the British centre-right, rather than with the left, in the interwar period was significant, given, as we will see, the nature of the British relationship with pan-Europe after 1945. In primarily surveying the correspondence of Richard Coudenhove-Kalergi with Leo Amery and Andrew MacFadyean, this analysis, thus, offers an insight into the British relationship with Europe over the longer term. Starting in with the Briand Plan in  1929 and ending with the Hague Congress in  1948 (where a call for Economic and Monetary Union was made, and which laid the groundwork for the European Movement), the British centre-right dialogue with one prominent pan-Europeanist will be sketched out.12 What follows is not to suggest that Coudenhove-Kalergi and upper-middle class Britons were the only game in town. The left’s greater propensity towards idealism, together with Ramsay MacDonald’s efforts to solve the European (primarily the German) question in the 1920s, provided a platform where it too could engage with a form of pan-Europeanism. Nevertheless, given the centre-right nature of the post-1945 European project – led by a former lawyer in Robert Schuman and businessman in Jean Monnet – it is worthwhile viewing the precursors of such moves, particularly as they relate to the Conservative Party. Recovering the European project also acts as a corrective to diplomatic historians’ propensity to emphasize bilateral relations, particularly with reference to appeasement.

Pan-Europa The International Pan-European Union (PEU) was officially launched in 1923 with the publication of Richard Coudenhove-Kalergi’s pamphlet Pan-Europa, 12

For example, Roy Denman’s Missed Chances: Britain and Europe in the Twentieth Century (London, 1997) gives barely three pages (53–6) to the Briand Plan.

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which presented social democracy as an improvement on the ‘feudal democracy of the sword’.13 Despite such sops to progressivism, the PEU was, from its outset, an aristocratic body more attuned to the right than to the left – not averse, as Passerini noted, to predicating its appeal on the superiority of the European race and, more specifically, of the European male.14 The British position within such a construct vacillated, starting with the notion they (and indeed the USSR) would remain outside the PEU but within a wider movement of ‘European Co-Operation’ to, by the early 1930s, an increasing desire to include Britain in the PEU itself.15 That question, as we will see, was left open. Count Richard Nikolaus von Coudenhove-Kalergi, on whom much of the pan-European cause would fall in the interwar period, was himself the product of ethnically mixed parentage. As Leo Amery put it, ‘his mother was Japanese and he himself is rather like a young Buddha in appearance and in outlook.’16 Paternally he was of Habsburg aristocratic stock, and his father spoke some 16 languages in a diplomatic career that took him from Athens via Rio de Janeiro to, most importantly for Coudenhove-Kalergi the younger, Tokyo.17 Completing his doctorate in philosophy in  1917 – aged just 23 – Coudenhove-Kalergi imbibed a range of intellectual standpoints, ranging from Oswald Spengler’s pessimistic Decline of the West to Woodrow Wilson’s Fourteen Points. That this man should come to be the link between Britain and the pan-European movement may surprise, particularly given the occasional Anglo-Saxon tendency towards shunning such philosophical discourse. Yet, as we will see, his PEU was predicated upon many concrete assumptions with which the British political elite agreed. Certainly, early contact had been made – as Lord Layton, Liberal peer and newspaper proprietor noted, ‘early in the nineteen twenties both [Churchill] and I had met an impressive personality who began to write books and articles on the [pan-European] subject practically from the day when the armistice was signed in November 1918.’18 Though Layton also met Jean Monnet, and with him ‘took joint control of the first conference that the 13 14

15 16 17

18

See Ben Rosamond, Theories of European Integration (Basingstoke, 2000), 21–2. Passerini, 55. On race in transnational discourse more generally, see B. W. Hart, British Germany and American eugenicists in transnational context, c. 1900–1939, University of Cambridge PhD thesis, 2011, passim. Ibid. Amery to Halifax, 26 February 1941, The Papers of Leo Amery, AMEL 2/2/5/2, CAC. On his origins, and the wider milieu, see R. Frank, ‘Les contretemps de l’aventure européenne’, Vingtième Siècle. Revue d’histoire, 60 (1998), 82–101. See Layton’s Unpublished Memoirs, Adventures in War and Peace, The Papers of Lord Layton, Box 148/3, page 8, Trinity College Archives, Cambridge.

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League of Nations planned, often ha[ving] occasion to meet between the wars,’ he referred in this instance to Coudenhove-Kalergi.19 To begin with, Coudenhove-Kalergi’s statement that he founded the PEU as ‘the only way of guarding against an eventual world hegemony by Russia’ was hardly alien to a Conservative Party which grabbed the nettle of the Zinoviev letter with such relish in its 1924 General Election campaign, essentially ejecting the Labour Party from office as a consequence.20 Though couched in the seemingly leftist language of European brotherhood – in which, it is true, he fervently believed – his discourse could be profoundly reactionary. His assertion that ‘the ideal of the gentleman is a substitute for armies of millions,’ together with his corollary that ‘English freedom was created by gentlemen and for gentlemen, and for this reason it is immune from the dangers of dictatorship and state totalitarianism,’ was, if not objectionable for many centre-right British politicians, not exactly suggestive of previous references to social democracy.21 That he believed the Briton, like the Roman in days gone by, to be ‘the highest type’ in the world made him well placed to deal with British elites.22 Even if, as the history professor Otto Hoetzsch noted, Coudenhove-Kalergi’s appeal primarily suited ‘the generation over fifty’, this hardly precluded the corridors of power in London.23 Most important, as we will see, was Coudenhove-Kalergi’s belief that a panEuropean structure was the method of preserving colonial hegemony, not a consequence of its collapse. European figures of the far-right would continue to forward this line in the coming decades – Joseph Goebbels arguing in the Third Reich’s dying days that Europe should save its old values (including, therefore, colonialism) against American plutocracy and Russian Bolshevism, while Oswald Mosley’s Union Movement continued to support a ‘Eur-Africa’ bloc well into the 1960s.24 Coudenhove-Kalergi was much of this mind, and his hastily penned September 1939 postscript to Europe Must Unite was fairly explicit: ‘the systematic organization of collaboration in colonial matters with a 19 20

21 22 23

24

Ibid., 28. S. Dorril, MI6: Inside the Covert World of Her Majesty’s Secret Service (London, 2000), 165. That von Habsburg was of similar social origins perhaps does not surprise either. On the pervasion of antiCommunism in Britain, and its later consequences, see M. Pugh, Hurrah for the Blackshirts: British Fascism Between the Wars (London, 2005). R. Coudenhove-Kalergi, The Totalitarian State Against Man (London, 1938), 71. Ibid., 129. C. Kessler (ed.), The Diaries of a Cosmopolitan: Count Harry Kessler 1918–1937 (London, 1971), 443 [30 January 1933]. M. Mazower, Dark Continent: Europe’s Twentieth Century (London, 1998), 184.

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view to fitting colonial raw-materials and markets into the economic complex of Europe’ would be a direct aim of any PEU.25 In this regard, he was in accord with much of the British political establishment who, given the right circumstances, may well have bought into his conception of Europe as a ‘neo-aristocratic Empire’.26 His opinions of the European fascist powers likewise broadly mirrored Conservative Party thought. Unlike the Liberal Andrew MacFadyean, who took him to task for such a view, he saw Mussolini’s Italy as a ‘practical return to democracy and the electoral system’.27 Though such a position had become less popular by 1938, Churchill had seen fit to praise Il Duce a decade earlier for his anti-communist credentials, with the Conservative MP and later anti-appeaser Edward Spears later declaring that ‘Mussolini rendered the world a great service when he rescued his country from anarchy’.28 Even if he had ‘considered it necessary to make his people swallow many unpalatable measures’, Spears saw the ‘national pride’ Mussolini had reawakened as more than sufficient compensation.29 Hitler was a different matter, and the Führer’s comment that Coudenhove-Kalergi was ‘everybody’s bastard’ summarized a mutual feeling that, for reasons of race, let alone policy, was scarcely likely to be friendly. Suffice to say, however, with his anti-communism, pro-imperialism and ambivalence to democracy, Coudenhove-Kalergi was well placed to make headway with the British middle and upper classes, even if, with post-1945 consequences, he had neglected the nation’s leftists.30

The impact of Briand Initially however, Aristide Briand advanced the pan-European cause more than the Coudenhove-Kalergi. While the many-time French Prime Minister was but one of many high-profile advocates of the PEU – they included as varied a personnel as the physicist Albert Einstein, economist Hjalmar Schacht and 25 26 27 28

29 30

R. Coudenhove-Kalergi, Europe Must Unite (London, 1940), 159. See Gusejnova, Crisis of Nobility, 73. Coudenhove-Kalergi, State, 10. America and the Next War, Undated Typescript, The Papers of Edward Louis Spears, SPRS 7/2, CAC. Ibid. Perhaps this is why Amery introduced him to the, by then abdicated, Edward VIII. J. Barnes and D. Nicholson (eds), The Leo Amery Diaries, Volume I: 1896–1929 (London, 1980), 438 [28 March 1937].

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psychoanalyst Sigmund Freud – he was almost certainly its most vocal.31 Having accepted the Honourary Presidency of the PEU in  1927, Briand went on to provide two of the most important moments in the cause for European unity. His speech at the League of Nations on 8 September 1929 is often regarded as one of the hallmarks of early pan-Europeanism and rode the wave of an increased interest in the concept of a United Europe (evidenced by a spate of English language publications on this very topic).32 Certainly, if politicians did not always obey the League, they at least listened to its pronouncements. Briand would circulate his ‘Memorandum on the Organization of a Regime of European Federal Union’ to the French Government, and this in turn made its way across the English Channel.33 Three MPs referenced Briand’s pan-European views in the Commons around this time.34 Robert Vansittart, former Parliamentary Secretary to Stanley Baldwin and newly appointed Permanent Under-Secretary at the Foreign Office, drafted the official FO response to Briand.35 First, he summarized the Frenchman’s aims: ‘regular contact on all questions of special interest to Europe’; ‘agreement upon a programme of co-operative study with a view to co-operative action [with regard to issues of] economics, finance, transit, labour, [and] health’; and ‘agreement upon methods of collaboration with outside States, including both non-European members of the League and such non-member states as the USSR.’36 Those who oppose the Lisbon process of late (with its provision for common EU foreign policy) might well have demurred at such arrangements in 1930 – yet Robert Vansittart evidently did not. Briand, like Coudenhove-Kalergi, understood the cadre with which he was dealing. He knew that federalism pushed to its limits would not be accepted by his own government, let alone the British. Yet, in his conception of the world, as with Coudenhove-Kalergi’s, Europe was not to be a replacement for the colonial empires of old, or of the nation state per se, but a supplement to them. The positive response with which the British met this can be glimpsed in Vansittart’s reply: 31 32

33

34

35 36

Coudenhove-Kalergi, Europe, 57. Such as P. Hutchison, The United States of Europe (London, 1929), W. Rappard, Uniting Europe (London, 1930) and S. Huddleston, Europe in Zigzags (London, 1929). See the response outlined in R. W. D. Boyce, ‘Britain’s First “No” to Europe; Britain and the Briand Plan, 1929–30’, European History Quarterly, 10 (1980), 17–45. Edward Wise (Labour, Leicester East), Peter Freeman (Labour, Brecon) and Col. Charles HowardBury (Conservative, Chelmsford), respectively. Speeches to the House of Commons, 17, 18 July and 23 July 1929, Parliamentary Debates, Commons, 5th Series, vol. 230, cols 409, 618, 1055. J. Charmley, Chamberlain and the Lost Peace (Chicago, 1989), 6, 9. Vansittart Memoradum, 23 June 1930, The Papers of Robert Vansittart, VNST 2/8, CAC.

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While, therefore, we must do nothing to hamper our freedom to develop our political and economic co-operation with the Dominions in any way . . . it is, I submit, our duty to assure Monsieur Briand that we are in full sympathy with the fundamental purpose of the policy of closer European co-operation for which he stands.37

So long as the Empire was not affected, and League of Nations authority was not fatally undermined, Vansittart believed that the British should show Briand ‘considerable sympathy’.38 The only danger was the creation of a series of rival continental power blocs. A pan-African or pan-Asian union would be ‘fraught with danger to the British Commonwealth and to the world’ – but provided pan-Europa maintained the imperial hierarchy, all was well.39 Col. HowardBury’s July 1929 address in the Commons – urging the Labour Government ‘get in touch with foreign Ministers of Labour and Commerce in Europe and discuss the possibility of the formation of an economic united states of Europe as the only means of fighting the high American tariffs’ – was illustrative that members of the British political elite recognized the geopolitical realities of the time.40 The League of Nations dimension has been expounded upon by others – notably Martin David Dubin.41 To Dubin, the functional side of the League of Nations has been overlooked. Certainly, security issues had undermined the organization’s credibility – particularly after the Hoare-Laval plan – but it is worthwhile, as Dubin argues, to recover the work of contemporary academics like David Mitrany who, together with more overtly political writers such as Arthur Salter, G. D. H. Cole and Leonard S. Woolf, were arguing that western powers could use transnational organs of co-operation to reduce the effects of economic depression, reduce friction and help develop international consciousness.42 In the 1930s, to be sure, various suggestions were made for stimulating international economic social collaboration – the 1939 Bruce plan for a Central Committee for Economic and Social Questions within the League framework serving as an apogee. As with pan-Europeanism, the emphasis was on a rational elite across 37 38 39 40

41

42

Ibid. Ibid. Vansittart Memoradum, VNST 2/8. Howard Bury Speech, 23 July 1929, Parliamentary Debates, Commons, 5th series, vol. 230, col. 1055. See the below, but also ‘Toward the Concept of Collective Security: The Bryce Group’s “Proposals for the Avoidance of War”, 1914–17’, International Organization, 24 (1970), 288–318. M. D. Dubin, ‘Transgovernmental Processes in the League of Nations’, International Organization, 37 (1983), 469–93.

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national boundaries providing an alternative to Hitlerian nationalism. To be sure, it did not take the horrific nature of the Second World War to put such questions in the minds of the British centre-right. Young Tories, in particular, were sympathetic to the League cause. Alfred Duff Cooper had long contributed to LNU meetings, John Loder (Conservative member for Lewes and co-author with Harold Macmillan and others of Industry and the State, a prominent liberal Conservative text) sat on the organization’s committee, and Victor Cazalet (Tory member for Chippenham) had donated money to the cause.43 Internationalism per se was not swept under the rug by either increasing governmental moves towards protectionism or a right wing press viewing Empire as a purely British institution – and Coudenhove-Kalergi was certainly prepared to chance his arm.44

A Conservative engages with Europe – Leo Amery One of the first of his targets was Leo Amery. In many ways he seems a strange choice – an ardent supporter of Tariff Reform and British Imperial Preference, as well as denouncing the Catholic ‘chinks’ in Northern Ireland, he appeared an unlikely bedfellow.45 Like Coudenhove-Kalergi, his origins perhaps offer something of a clue.46 Born in India to a British civil servant father and a Hungarian Jewish mother, he combined a traditionally upper-middle-class English background (Harrow School and then Oxford University) with European (he spoke accented, but fluent, German) and Imperial connections. Like many of his generation, World War I was transformative. Writing to Lord Milner in 1915, he derided the contemporary anti-German propaganda: ‘All this harping on Prussian militarism as something that must be rooted out, as in itself criminal and opposed to the interests of an imaginary virtuous and pacific entity called Europe, in which we are included, is wholly mischievous.’47 Though he indulged in the expected German baiting during the 1918 General Election, he was no

43

44 45

46

47

See R. Carr, ‘Veterans of the First World War and Conservative anti-appeasement’, Twentieth Century British History, 22/1 (2011), 28–51. As an example of the right-wing press, see the editorial in the Daily Express, 6 September 1929. J. Barnes and D. Nicholson (eds), The Leo Amery Diaries, Volume I: 1896–1929 (London, 1980), 84 [5 January 1912]. See Leo Amery’s Oxford Dictionary of National Biography entry. http://www.oxforddnb.com/view/ article/30401 Barnes and Nicholson, Amery Diaries, I, 116 [26 May 1915].

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consistent Germanophobe.48 Even given his later hostility towards appeasement, Amery noted in 1935 that if the Nazi regime was clearly dangerous, ‘it would equally be unwise for Germany’s neighbours to reject Herr Hitler’s recent professions of peaceful intentions as wholly insincere’.49 As Richard S. Grayson has noted, Amery was willing to revise European boundaries along Chamber­ lainian lines – only in the imperial sphere did he baulk.50 Like CoudenhoveKalergi, he too praised Mussolini’s achievements, seeing the corporate state as ‘progress in the art of government’.51 While, as we will see, Amery was careful to keep him at arm’s length, the Austrian aristocrat and the Conservative MP for Birmingham Sparksbrook were by no means politically incompatible. Writing to Amery on 19 July 1929, Coudenhove-Kalergi was sorry to note the recent negative attitude the British newspapers had taken towards the panEuropean ideal. In slightly garbled English, he revealed why Amery was such a sound choice as a potentially pro-European Trojan horse: ‘I think that just the closer cooperation between England and the Dominions should help us in our pan-european [sic] effort to prevent that these great federations are organized against each other, instead of working all from the beginning together.’52 Few would have had a more fervent desire to promote such cooperation between the mother country and dominions than Amery – he, who, after all, believed ‘the foundation of our foreign policy must be our own League of Nations of the Empire.’53 Unfortunately for the Austrian, Amery claimed his upcoming trip to Canada rendered it impossible for him to convene any British Committee of the PEU as requested.54 Amery did, however, jot a note to fellow Conservative Robert Horne arguing that ‘the Pan-Europe idea is an intrinsically sound one’, even if, for now, Britain was ‘right to keep outside the Pan-European Union but friendly to it’.55

48

49 50

51 52 53 54 55

Amery in Birmingham was no exception. Throughout the 1918 campaign, the press in Hull was in virtual hysterics: ‘The Zeppelins Foul Work: Striking Record of German Infamy’; ‘What Hull will Never Forget: The Murderous Work of the Zeppelins’; ‘More pictures of Zeppelin Raid Damage’. That Hull would return four MPs with some form of patriotic war service – including three Coalition Conservatives – perhaps comes as little surprise amidst such a heady atmosphere. Hull News and the Weekly Supplement, 7 December 1918, 14 December 1918. L. S. Amery, The Forward View (London, 1935), 147. R. S. Grayson, ‘Leo Amery’s Imperialist Alternative to Appeasement in the 1930s’, Twentieth Century British History, 17/4 (2006), 489–515. Amery, Forward View, 450. Coudenhove-Kalergi to Amery, 19 July 1929, AMEL 2/1/18/1. Amery, Forward View, 272. Amery to Coudenhove-Kalergi, 29 July 1929, AMEL 2/1/18/1. Amery to Horne, 29 July 1929, AMEL 2/1/18/1.

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Coudenhove-Kalergi was forced to play a slow game, as his continuing contact with Amery illustrated. Accepting the opportunity to address the PEU congress in Berlin during May 1930, Amery noted that ‘my chief part was to make quite clear both our sympathy and our inability to take part in any Pan European Union’.56 Similarly, when Coudenhove-Kalergi rebuked the foreign policy records of Arthur Henderson and Austen Chamberlain, he received the slightly acerbic reply from Amery that ‘both of them are really only displaying in their attitude to the European question, not so much stupidity, as the fact that mentally we are much too far from Europe ever to enter wholeheartedly into its policies’.57 Thus, the contemporary British publication of books such as European Civilization: Its Origins and Development did not augur a collective change in attitudes, even if they attracted the scholarship of economists such as Ralph Hawtrey.58 To his strategic credit, the PEU president knew which buttons he should push, and did so effectively: Any cooperative Pan European Committee in England would have to show public opinion that a continental Pan European organization is by no means constituting a danger for the politics of the British Empire, but on the contrary is forming a necessary element of equilibrium towards the Soviets and America. I think that this idea should be worked out very clearly in close collaboration with the British Empire Movement and in connection with the anti-Sovietic groups in England.59

Thus did Coudenhove-Kalergi later seek out Duncan Sandys, who would establish the European Movement after the war, but in the 1930s was more known for his Tory constitutionalism against the totalitarian forces of left and right.60 Such vessels were more fertile ground for the PEU than Labour, whose commitment to the League of Nations in a more universalist sense – above and beyond the diplomatic pragmatism often the preserve of the right – and

56 57 58

59 60

Barnes and Nicholson, Amery Diaries, II, 70 [18 May 1930]. Ibid., 162 [9 June 1931]. See material in the papers of Ralph Hawtrey, HTRY 10/42, CAC. At the October 1932 congress in Basle, Amery seems to have enjoyed trying to understand those speakers whose languages he did not speak as much as the Pan-European agenda on offer. Barnes and Nicholson, Amery Diaries, II, 282 [1 October 1932]. Coudenhove-Kalergi to Amery, 7 March 1931, AMEL 2/2/5/2. On his Europeanism, see the material at Churchill College (CAC, DNSD/9) and at the EUI, MEE000315 and MEE-000489. On his earlier politics, G. Love, ‘The British Movement, Duncan Sandys, and the Politics of Constitutionalism’, Journal of Contemporary History, 23 (2009), 543–58.

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sometime sympathy with the Soviet Union rendered their followers somewhat unsuitable allies.61 With efforts to stimulate the economy higher on the agenda than the philosophical question of Britain’s relationship with Europe, the early 1930s saw little communication between the PEU and British politicians – though by 1933 Coudenhove-Kalergi was describing both Amery and Churchill as supporters.62 The looming threat of another war reinvigorated contact, however. In  1937, Amery once again became Coudenhove-Kalergi’s pivot, putting him in touch with Lord Robert Cecil – whose declaration that ‘such a [European] federation – of course in the framework of the L[eague] o[f] N[ations] – can save our future’ much pleased the Austrian Count.63 Cecil, like Amery before him, demurred at the possibility of forming a British branch of the PEU, yet Coudenhove-Kalergi did not stop there. Such determination was not without some hope of success indeed, for slowly but surely, a prominent Liberal Party member – Andrew MacFadyean – was beginning to consider the merits of the pan-European ideal.

A Liberal engages with Europe – Andrew MacFadyean Andrew MacFadyean, like Amery, was educated at Oxford.64 Joining His Majesty’s Treasury prior to World War I, he became one of the leading experts concerning German reparations, succeeding Arthur Salter as General Secretary of the Reparation Commission in  1922. Like Keynes, he warned against a Carthaginian Peace, and was a member of the Dawes Committee proposing that German reparations should only take place if and when they did not distort the rate of currency exchange. After returning to London and a career in the City, MacFadyean became joint treasurer of the Liberal Party in 1936, a position he occupied for 12  years. Combining a background in economic diplomacy – from 1933 he was a member of the Royal Institute of International Affairs (Chatham House) – with fluent German, he was a natural target for the PEU President. 61

62 63 64

Protectionism was also an issue. To Howard-Bury’s 1929 pan-European tariff query, William Graham’s reply for Labour was that ‘there is nothing to be gained by any policy which involves discrimination.’ Howard Bury and Graham Speech to House of Commons, 23 July 1929, Parliamentary Debates, Commons, 5th series, vol. 230, col. 1055. Kessler (ed.), The Diaries of a Cosmopolitan, 443 [30 January 1933]. Coudenhove-Kalergi to Cecil, 9 March 1937, AMEL 2/2/5/2. See MacFadyean’s ODNB entry, http://www.oxforddnb.com/view/article/31390

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In July 1938, Coudenhove-Kalergi first secured MacFadyean’s services to translate his oeuvre The Totalitarian State Against Man.65 While MacFadyean retained reservations regarding Coudenhove-Kalergi’s sympathy towards Italian fascism, his internationalist ethos was clearly complementary to MacFadyean’s liberalism. Corresponding in September that year, the Briton noted that ‘when you are next over here we must have a discussion about Paneuropa. You have interested me, but I am not sure that you have entirely convinced me.’66 This left Coudenhove-Kalergi ‘sorry my book didn’t convince you. There must certainly be some lack in it, because its principal aim is to convince those who read it.’67 Not an entirely promising beginning, but as with Amery, Coudenhove-Kalergi was not deterred. He had, after all, a world view that could both attract Conservative leanings towards a hierarchical order and complement Liberal beliefs in laissezfaire. In The Totalitarian State, he noted that ‘democracy and liberalism are not identical. Many countries are more democratic than England with its monarchy and feudal Upper House, but there is no country which is more liberal or shows a greater respect for the personal freedom of the individual’.68 Events were about to shake things up. On the one hand, the need for Anglo-French co-operation against Hitler would put lofty ideals such as pan-Europeanism to one side – despite Arthur Henderson’s protestation that Briandism could solve the economic dilemmas Versailles had produced.69 Certainly, however, ‘le qualité spécial’ between Britain and France, if couched by Edward Spears in the terms that ‘cette amitié n’exclut d’ailleurs aucun autre pays,’ was clearly a matter of bilateral diplomacy, rather than the victory of internationalism.70 Spears’ rush to recruit members to the Anglo-French Parliamentary Committee (AFPC) in the summer of 1939 – which by July that year numbered some 214 MPs compared to 395 French Deputies – was 65

66 67 68 69

70

See letter, 16 July 1938, The Papers of Andrew MacFadyean, MacFadyean 6/10, London School of Economics (LSE). MacFadyean to Coudenhove-Kalergi, 9 September 1938, Ibid. Coudenhove-Kalergi to MacFadyean, 13 September 1938, Ibid. Coudenhove-Kalergi, Totalitarian, 65. See Henderson Speech of 21 December 1937, Parliamentary Debates, 5th series, vol. 330, cols 1839– 40. ‘It is perhaps no new discovery to realize that some of the countries which were carved out by the Treaty of Versailles have only managed to eke out a very meagre existence during the last 15 or 18 years, and I believe that it was the condition in which many of those small countries found themselves, and find themselves to-day, which was the origin of the policy laid down by the late Aristide Briand when he advocated a United States of Europe . . . It may well be that [this] will be one of the methods by which we may hope to remedy the misfortunes which these various nations suffer at the present time’. Spears Speech in Bulletin Mensuel des Relations Franco-Brittaniques, July–August 1937, SPRS 1/10.

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seemingly more a consequence of the diplomatic game than endorsement of PEU ideals.71 And yet the AFPC was, albeit tacitly, speaking CoudenhoveKalergi’s language. On 3 and 4 August 1939 – less than a month before German troops crossed the Polish border – a meeting took place between the French and British parliamentary bodies. Resolving to meet regularly, they also pledged to form three subcommittees – the first, unsurprisingly, dealing with questions of defence, the second with cultural relations and propaganda, and the last to highlight ‘the importance of liaison between the colonial administrations of the two countries’.72 Such transnational bodies were not altogether removed from the proposals of Coudenhove-Kalergi or Briand regarding imperial unity and ideological homogeneity. Prominent cross-party figures such as Hugh Dalton, Roger Keyes and William Wedgwood-Benn signed the accord, offering evidence that Coudenhove-Kalergi was operating in an arena less hostile to his ideals than one might suspect.73 Hitler, of course, threw matters off course. As Leo Amery penned in his preface to Europe Must Unite: there is no time for laying down detailed conditions of peace which may bear no relation to the realities of tomorrow. But it is all the more necessary that we should, even now, begin to envisage and proclaim, to Europe and even to Germany, the practical ideal which inspires our efforts and our sacrifices. From that point of view nothing could be more timely than the appearance of this book. Fully to appreciate both the clarity, the balance, the broad sweep of its handling of a great argument, and the serene fervour of its conclusion, one should come to it fresh from a perusal of the endless turbid, unbalanced, hatefilled pages of Mein Kampf. I can conceive of no better practical illustration of the author’s summing up of nationalist chauvinism as “the world outlook of the half-educated.”74

Hitler was a gift and a curse to the PEU. On the one hand, he diverted shortterm attention away from the pan-European goal. On the other, his hate-filled nationalism made its eventual triumph ever more likely. Certainly, CoudenhoveKalergi’s British correspondents took time to be convinced of this notion. The Austrian’s belief that the British Guarantee of Poland in March 1939 was 71 72

73 74

Nicholson and Henderson Message, 27 July 1939, SPRS 1/10. AFPC and Franco-British Group of the Chamber of Deputies Meeting Report, August 1939, SPRS 1/10. Ibid. Coudenhove-Kalergi, Europe, 15, 11.

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‘a decisive step towards the realization of pan-Europa’ met with a polite rebuttal from MacFadyean: You really are a delightfully confirmed optimist to interpret anything that has recently happened as a decisive step towards the realization of Paneurope. Sub specie aeternitatis, yes, but, as I greatly fear, with a blood bath to be endured before your desirable consummation.75

Yet attitudes did indeed shift. In June 1939, a British Pan-European Committee was finally convened with Duff Cooper as Chairman and Victor Cazalet as Secretary. A series of letters began appearing in the Manchester Guardian a month later urging the need for a pan-European Union.76 Duff Cooper, like MacFadyean, had yet to be fully convinced of Coudenhove-Kalergi’s arguments, but was slowly coming around: ‘of the various schemes of the kind which are in existence, it is by far the best, although I fear that I have some doubts as to whether it would prove practicable.’77 War would ease such doubts, just as it would delay the pan-European cause.

The onset of war The horrors of conflict brought a greater sympathy to the pacifistic element of Coudenhove-Kalergi’s platform. Writing to Harold Nicolson in 1940 to ask him to nominate Coudenhove-Kalergi for a Nobel Peace Prize, Leo Amery did ‘so willingly, for I don’t think that anybody has worked so single-mindedly for European peace, and his ideas are now receiving much wider recognition than ever before. After all, both Neville [Chamberlain] and [Edward] Halifax have, consciously, or unconsciously, adopted his main under-lying ideas’.78 There was something in this. For though Chamberlain’s comment that Czechoslovakia was ‘a faraway people of whom we know nothing’ might suggest naked realpolitik lay behind appeasement, ‘peace for our time’ – as its comparison to Disraeli at the Congress of Berlin suggested – was on a European scale. Claiming that the Austrian paved the way for Briand’s 1929 address, even the anti-appeaser Amery praised Coudenhove-Kalergi’s ‘selfless devotion to an ideal with a real sense of 75

76 77 78

Coudenhove-Kalergi to MacFadyean, 8 April 1939, and MacFadyean’s reply, 12 April 1939, MacFadyean 6/10. MacFadyean Correspondence with Duff Cooper, July 1939, MacFadyean 6/10. Duff Cooper to MacFadyean, 17 July 1939, MacFadyean 6/10. Amery to Nicolson, 12 January 1940, AMEL 2/2/5/2.

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the actual political situation’.79 With the war, there was a sense that the ‘given moment’ for the European ideal had arrived. One slight hindrance was the pre-occupation of Duff Cooper, Amery and Nicolson with high office. Though Amery negotiated the opening of a PEU bank account in February 1940 and harried Rab Butler into issuing the PEU President with a British visa that summer, he became aware that he could not fulfil all the pan-European tasks Coudenhove-Kalergi might require.80 Thus did he request MacFadyean that he become treasurer of the British Pan-European Committee. MacFadyean’s reply is interesting, indicative of how war had indeed changed the state of play: As I am not even a member of Coudenhove’s organisation – I told him frankly that, while I had profound sympathy for his views, I had to suspend judgement about his organisation – it occurs to me that I am not the most suitable person to be treasurer. However this is not time to stickle, if there is such a word, about unimportant proprieties, and if you will send me along the bank books I will gladly do what is necessary.81

Thereby MacFadyean became officially interlinked with the PEU. He would not look back, even if his pan-Europeanism would sometimes be expressed through tangential causes.

The American connection While Churchill continued to speak in Anglo-American terms throughout the war (peppered, certainly, by the odd ‘Europe Unite’ speech), growing British subservience to their cousins across the Atlantic would arguably become the key factor in driving prominent centre-right Britons closer to the PEU bosom. Coudenhove-Kalergi, fulfilling Amery’s praise of his pragmatism, was moving ever more fully into a multi-polar conception of the post-war world. His Defence of Western Civilization spoke of three power blocs, pan-European, American and British – which, given Lend-Lease and the sapping effects of conflict, was probably about the best the British could expect out of the conflict. It was unsurprising then that MacFadyean was in general accord, pointing out that, while preferring 79 80 81

Ibid. See letters of 8 February and 13 July 1940, AMEL 2/2/5/2. MacFadyean to Amery, 22 May 1940, MacFadyean 6/10.

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Coudenhove-Kalergi’s framework, he ‘would rather see the peace of the world guaranteed by an indissoluble union between the United States and Great Britain than an American airfleet!’82 America was almost certain to lead the post-war west, and this worried prominent Britons, with Amery expressing to MacFadyean that he too liked the evolution in Coudenhove-Kalergi’s thought.83 The fear also remained that, as after Versailles, America would withdraw from Europe. As a result, MacFadyean was by 1942 ‘more and more persuaded of our need to identify ourselves with the continent – if only as a reinsurance move against the risk of a repeated American refusal of responsibility.’84 Fearing the consequences if Roosevelt’s Democratic Party were to lose power in Washington, he noted that ‘the Republicans frighten me’.85 Marshall Aid was a long way off in 1942, and with Britain still heavily mortgaged to the Americans for World War I, let alone the costs of the second, there was every reason for trepidation. Amery may have comforted Coudenhove-Kalergi by telling him ‘the PM has always been sympathetic to your general idea’, but Churchill’s world view could be as Anglophone as continental.86 Speaking in 1944, Somerset de Chair, Conservative MP for South-West Norfolk, implored Churchill to back up his previous pan-European rhetoric with concrete action, but the very necessity of the plea did not augur well for its success.87 Having fallen out of touch with the, by then, New York-based CoudenhoveKalergi for almost a year, MacFadyean got back in touch at the beginning of 1944 to claim that The longer I live and the more I read the more I am convinced that you are on the right lines, unfortunately the more doubtful I am whether we are going to have the opportunity of making PanEurope as at this time [despite it being] the ideal opportunity because all things being in a state of flux.88

Despite Coudenhove-Kalergi having recruited Anthony Eden and Edward Grigg (another, like Spears, Liberal turned Conservative MP) to his cause, and

82 83 84 85 86 87

88

MacFadyean to Coudenhove-Kalergi, 20 February 1941, Ibid. Amery to MacFadyean, 20 May 1941, Ibid. MacFadyean to Coudenhove-Kalergi, 7 December 1942, Ibid. Ibid. Amery to Coudenhove-Kalergi, 2 July 1943, AMEL 2/2/5/2. De Chair Speech to the Commons, 25 May 1944, Parliamentary Debates, Commons, 5th series, vol. 400, col. 976. De Chair, like Duff Cooper, saw Coudenhove-Kalergi’s Totalitarian State Against Man on a par with Mein Kampf and Rousseau’s Social Contrast in terms of historical importance. Also his earlier speech, 15 March 1939, Parliamentary Debates, Commons, 5th series, vol. 345, col. 490. MacFadyean to Coudenhove-Kalergi, 5 January 1944, MacFadyean 6/10.

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the fact that he was ‘bound to win in the end’, MacFadyean did not detect any groundswell in favour of the PEU as the war neared its conclusion. This may be partly ascribed to Coudenhove-Kalergi ceasing ‘all activities in Europe [from 1940] because I was afraid that any Pan-European propaganda might be abused by the promoters of the New Order [i.e. Hitler]’.89 Seeking ‘to gain American public opinion for [the] idea’, New York University became the fulcrum for Coudenhove-Kalergi’s ‘Research Seminar for Post-War European Federation’. NYU would also sponsor the Pan-European Conference in New York, headed by Coudenhove-Kalergi and the former Foreign Minister of Spain, Fernando de las Rios.90 By March 1945, having received the support of the American Committee for a Free and United Europe (whose members included Henry Morgenthau), Coudenhove-Kalergi and de las Rios issued their ‘Declaration of European InterDependence’ calling for a ‘European confederation be[ing] established around a European Council and a Supreme Court’, ‘a military force . . . composed of soldiers of the member states under the Confederation’s authority’, and a ‘bill of social rights aim[ing] at assuring to all Europeans “freedom from want”, by a series of basic social and economic reforms’.91 Despite such grandiose aims, the failure to find a publisher for CoudenhoveKalergi’s Crusade for Pan-Europa did little to change the perception that the movement was, at the present moment, struggling. MacFadyean’s letter to Coudenhove-Kalergi on this matter suggested that they had missed the boat, but that the opportunity would come again: I am very sorry, not only for your sake, about this failure, because I think a public discussion about the future of Europe is highly necessary. In a sense your book is too late or too early; too late because all the things affecting the necessary reconstruction of the world politically . . . have become hopelessly blurred in people’s minds; too early because when the war has been over two years and we can again be a little more dispassionate we shall see its lessons as clearly as I think we did in 1939 or 1940, and then people will listen again to your message.92

In some senses this was prophetic. It would take a while for the British to take on board the benefits of European Union – a process that is still ongoing. 89

90 91 92

Extract from Report by Count Coudenhove-Kalergi, Undated, The Papers of Julian Amery, AMEJ 1/3 – re-catalogued as 523/1, CAC. Ibid. Ibid. MacFadyean to Coudenhove-Kalergi, 3 October 1944, MacFadyean 6/10.

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MacFadyean’s reference to 1939 and 1940 is likewise interesting: though the British people could rely on themselves, the panic surrounding the threat of Nazi invasion was clearly something to be avoided. Britain’s ‘finest hour’ had also been achieved largely without America, and though Churchill might have otherwise, the pragmatic attitude the United States had taken in both wars rendered them an unreliable ally. D-Day and VE-Day might be uppermost in people’s mind, but once they began to analyse the war with any degree of hindsight, the AngloAmerican alliance would appear less glorious and more one-sided. Within the 2-year timetable MacFadyean outlined indeed, pan-Europeanism had assumed a more concrete form on the British centre-right.

After 1945 Pan-Europeanism within Britain after 1945 was a movement encompassing many distinct bodies. The most prominent among these included the United Europe Movement (UEM) numbering Leo Amery, Duncan Sandys and Churchill; the European Union of Federalists (EUF – including the Labour MP Reverend Gordon Lang); the European Parliamentary Union (EPU – involving Bob Boothby); and the Independent League of Economic Co-operation (ILECO – including Lord Layton).93 Memberships of each group could often overlap with one another, bodies would interact with likeminded groups on the continent, and – as with pre-1939 machinations – the pan-European cause intersected with liberal causes, such as the Free Trade Union (whose President, MacFadyean, used the body to campaign for a European Common Market). To outline the various interactions between these bodies is beyond the scope of this section, but in briefly charting developments up to The Hague Congress in 1948 and its immediate aftermath, we can draw some overarching conclusions. The first concerns Coudenhove-Kalergi’s post-facto importance. Though the pan-European field was growing ever larger, throughout the late 1940s he was still regarded as a figure of some repute. A month prior to his attending the Hague Conference in May 1948, Coudenhove-Kalergi became unwittingly included in an argument between Churchill and the former French Prime Minister, Leon Blum, that cut to the heart of the debate over who exactly was leading the pan-European project and for what ends. We will turn to the validity 93

See ‘Congress of Europe’, Undated note (presumably 1948), Layton Papers, Box 141/2.

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and implications of the claim later, but the key point here is that CoudenhoveKalergi and his pre-1939 activities were used as a harbinger of the post-1945 machinations. In Le Populaire, for which he was a regular contributor, Blum had claimed that The stamp of [Churchill’s] authority brought with it the danger that the European federation would have a character too narrowly Churchillian. Thus is explained the embarrassment, circumspection and hesitation of the Labour Party, and, in consequence, of international Socialism.94

Churchill’s character was not the issue – Blum’s concern was more what he represented. Yet Churchill’s reply is of equal interest. Referencing his 1946 Zurich address in which he had called for European unity, Churchill claimed he had revived the ancient and glorious conception of a United Europe, associated before the war with the names of M. Briand and Count Coudenhove-Kalergi, which I had supported for many years, I had no idea it would become a Party question. Nothing could be more wrong and foolish than for the Socialist Parties of Europe to try and create and maintain a monopoly of cause and policy which belongs not to local Parties, but to whole states and nations.95

While Briand and Coudenhove-Kalergi were both speaking in the 1920s and 1930s for a United Europe, to suggest that they denoted an absolute cross-party consensus on the issue was disingenuous at best. Similar to Duncan Sandy’s attempts to enlist Liberals and Socialists to his UEM in 1947 (‘to make it clear to all potential subscribers that the movement is all-party’), there were real limitations here.96 Coudenhove-Kalergi’s inclusion in such discourse, however, did at least speak for his pre-1939 importance. As these continued references to Coudenhove-Kalergi suggested, the panEuropean centre-right message in Britain had actually changed very little. Speaking in Strasbourg in 1953, Leo Amery quoted a letter from Churchill to Eden 11  years earlier: ‘my thoughts rest primarily [on] . . . the revival of the glory of Europe.’ ‘It would,’ Churchill continued, ‘be a measureless disaster if Russian barbarism overlaid the culture and independence of the ancient States of Europe.’97 Aside from forming a prelude to the Iron Curtain address at Fulton, 94

95 96 97

Contained within DSND 9/3/22. For Blum and his pan-European thought, see M. Newman, ‘Léon Blum, French Socialism, and European Unity, 1940–50’, Historical Journal, 24 (1981), 189–200. DSND 9/3/22. Duncan Sandys to Layton, 27 August 1947, Layton Papers, Box 132/2. Churchill to Eden, October 1942, quoted in Leo Amery’s Strasbourg speech, September 1953, AMEJ 523/1.

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Missouri, Amery and Churchill illustrated that the rationale for pan-Europe had changed little. To defend the continent, Amery also postulated a ‘Great Europe’ preserving the colonial possessions of Belgium, Britain, France, Portugal and the Netherlands – similar, indeed, to his (and Vansittart’s) previous reactions to Briand’s 1929 address.98 As Macmillan wrote in 1949, ‘as leaders . . . of both the Commonwealth and Europe we should be able to establish a more equal partnership with the United States both in the immediate task of containing Russia and in the longer term.’99 It was on this understanding that the British centre-right attempted to negotiate with the Continent. In light of this (and in the context of paving the way for withdrawal from India), it is perhaps unsurprising that the Labour Government was reticent to adopt the pan-European cause after 1945. Richard Coudenhove-Kalergi was hardly suggestive of a progressive ideal, nor were Amery or Churchill. John Hynd, a Labour MP who expressed an interest in attending The Hague meeting in 1948, was given a sharp rebuke by Morgan Phillips, Secretary of the Labour Party: The N[ational] E[xecutive] C[ommittee] strongly disapproves of members taking part in the Hague Congress, whether as individuals or as representatives of organisations. The NEC is unconditionally opposed to any action which might appear to associate the prestige of the governing majority party in Great Britain, however indirectly, with an organisation calculated to serve the interests of the British Conservative Party.100

Hynd’s reply was suitably swift, assuring Phillips that his name had been included by mistake and, while he wished the Hague Congress well, he would not attend. Hynd, like other Labour members, was reminded that the Socialist European Recovery Programme should be their organ of choice: ‘the ideal of European unity can only be saved form corruption by reactionary politicians if the Socialists place themselves at the head of the movement for its realization.’101 The immediate goal was to protect the socialist New Jerusalem from any hostile external influence. Yet we may conclude by noting that Labour was not opposed solely out of political self-interest. Invitations to the Hague Congress were supposedly decided ‘in proportion to party strength’.102 If defined by House

Ibid. Macmillan Paper on ‘European Integration’, DSND 9/3/22. Morgan Phillips to John Hynd, 21 April 1948, The Papers of John Hynd, HYND 4/9. 101 Ibid., also see the letter of 26 April 1948. 102 See ‘List of Participants to the Congress of Europe from Great Britain’, DSND 9/3/22.   98   99 100

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of Commons membership, this was clearly fallacious: of the 76 invitations to British MPs, 28 were offered to Conservatives, with a further 2 given to Liberal Nationals (by then merged at the constituency, and essentially ideological, level with the Tories).103 Thus, compared to the 31.96 per cent of Commons seats they had won at the 1945 election, these 30 MPs made up 40.5 per cent of invitations to the Congress.104 Labour had won 61.41 per cent of seats in 1945 but were offered under half (48%) the invitations to The Hague. The Liberals, in MacFadyean’s wake, were arguably over-represented with 5 of their 12 MPs elected in  1945 being invited. Conservative efforts to rope in Liberals such as Lord Layton were one thing, but the under-representation of Labour does invite some scepticism as to the motives of pan-Europeanism after 1945. Again, it would take a longer piece than this to fully delineate, but one may finally argue that Coudenhove-Kalergi’s social status, Amery’s Conservatism and MacFadyean’s adherence to, and support of, laissez-faire economics were no coincidence – and vindicate tracing the story back before 1945. In short, as we saw, Labour were worried that panEuropeanism was but the tool of big business, expressed through its political ally, the Conservative Party. One can certainly forward explanations for why this was so, but it remains a fact that the more economically liberal the party, the greater the likelihood an invited MP would accept an invitation to attend the Hague gathering: Labour – 61 per cent, Conservatives – 89 per cent, Liberals – 100 per cent.105 More importantly, the papers of Lord Layton indicate that Labour may well have been right in their suspicions. Conservative businessmen dominated the list of major donations to the UEM:

Major donors to the UEM, 1948–49 – of a £21,116 total106 W. Garfield Weston (Weston Foods) £5,000 Sir Henry Price (Price, Tailors, Ltd) £5,000 Sir Simon Marks (of Marks and Spencer) £2,000 L. P. Lord (Austin Motor Company) £1,000 Ibid., (and British Delegation to the Congress of Europe at the Hague May 7–10). In 1945, out of a total of 640 seats, Labour had won 393, the Conservatives 197 and the Liberals 12. Of the 36 Labour invitees, 22 said yes. For Conservatives, the ratio was 28:25, with all five Liberals accepting their invitation. 106 See Layton’s correspondence on UEM donations, Layton Papers, Box 132/2. 103 104 105

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Geoffrey Heyworth (Unilever) £1,000 W. Benton Jones (United Steel Companies Limited) £1,000 Sir Brian Mountain (Eagle Star Insurance) £1,000 Lord Airedale (Ford Motor Ltd) £1,000 Viscount Camrose (Daily Telegraph) £500 Labour had a right to their scepticism. A pan-European movement propagated before 1945 by a Habsburg Count which had attempted to court a, in many respects, right-wing Tory in Amery (certainly in imperial matters) and a rigid free-trader in MacFadyean had not proved particularly appealing. While Dalton and Henderson had expressed sympathy with aspects of British engagement with the Continent – particularly with regard to combating Nazism, either intellectually or militarily – they were hardly likely to subscribe to a panEuropeanism that seemed aimed at the extension of the Empire, rather than at its eventual, gradual and peaceful dissolution. The crucial point is that, by the late 1940s, not much had changed. Pan-Europeanism was backed by high finance, was predicating itself on being a vehicle to extend imperialism indefinitely and was picking fights with continental socialists such as Leon Blum. If the Durham miners would not wear Britain in Europe, to paraphrase Herbert Morrison, nor would Labour readily subscribe to a movement which kept such company. Following the pan-European story in the 1930s, thus, provides several important insights, particularly regarding the role of Conservatives. First, the European Movement which emerged following the Hague Congress and united most – though still not all – of the bodies that were preaching some form of pan-European message after 1945 owed as much to, for example, CoudenhoveKalergi’s dialogue with Amery and MacFadyean as to the more grandiose post-1945 set pieces. There was, to be sure, something of a grey area. In part, Coudenhove-Kalergi’s ambiguous treatment by Amery, MacFadyean and others prior to the war does suggest a reticence to engage with Europe before the story of British Imperial hegemony was told – and thus, that the references after 1945 to such discourse were somewhat disingenuous. Yet figures on the British centre-right had indeed engaged with the Austrian – and found areas of substantial accord (anti-communism, pro-imperialism and a growing concern that the United States of America was rising to global dominance) – that suggest that there was a pedigree of pan-Europeanism in Britain outside the left. Crossparty organs such as the LNU played a role to be sure, with Labour, Liberal and Conservatives reaching at least partial accord within such groups.

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At the same time, Coudenhove-Kalergi’s interactions called into question the post-war message espoused by groups of the centre-right that everyone was, and had been, included. The National Government from 1931 rendered the coalition between right-leaning Liberals and centrist Conservatives attractive, building on the base of Baldwin’s previous success of directly absorbing such figures into the Tory Party in the 1920s (the aforementioned, Churchill, Grigg and Spears, but also bright young figures such as Edward Hilton Young and Cyril Entwistle).107 The term ‘everyone’, however, excluded a significant number. For those inside the Baldwinian big tent to see themselves as virtuous there needed to be those outside to demonize. With pan-Europeanism in the 1930s, as with government more generally, this was the British left. Coudenhove-Kalergi met and discussed the United States of Europe with figures such as Briand, MacDonald and Gilbert Murray just enough to appear credible but offered a platform which was difficult from them to wholly subscribe to. After 1945, this gave the centre-right the chance to claim that some cross-party pro-European coalition had existed prior to 1939 and that Labour politicians were demurring from its legacy. The fact that conflating left and (centre) right perceptions of pan-Europe – both before and after 1945 – was rather misleading caused a Conservative Party seeking a distinct, nominally positive, appeal from Labour little concern. There was indeed engagement from the centre-right with pan-Europeanists, but of a limited kind. Clement Attlee’s reluctance to take up a leadership position with regard to European Union after 1945 was, in some sense, the logical outcome of those very machinations.108 It would be a Conservative Prime Minister, Ted Heath, who would eventually lead Britain into the European Economic Community in 1973 – after Harold Macmillan had had his bid for entry in  1961 vetoed by Charles De Gaulle. Leading lights on the left – Tony Benn and Barbara Castle in particular – would continue to see the European project as part of a free-market agenda to bolster the interests of leading capitalists. The origins of this, as we have seen, lay in part of the legacy of the 1930s and 1940s. Yet the Conservatives, having backed the ‘yes’ vote in the referendum on EEC membership 1975, would also go on to For Conservative-Liberal crossovers from the Great War Generation, see R. Carr, The Phoenix Generation at Westminster: Great War Veterans Turned Tory MPs, Democratic Political Culture, and the Path of British Conservatism from the Armistice to the Welfare State, University of East Anglia PhD thesis, 2010, Appendix C. 108 On the immediate period following this article, see P. M. Coupland, ‘Western Union, “Spiritual Union”, and European Integration, 1948–51’, Journal of British Studies, 43 (2004), 366–94. 107

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adopt a largely Eurosceptic position in later years. In language reminiscent of the anti-Labour ‘Gestapo’ rhetoric of 1945, Thatcher would declare that ‘we have not successfully rolled back the frontiers of the state in Britain, only to see them re-imposed at a European level, with a European super-state exercising a new dominance in Brussels’. A free market yes, political integration no has generally dominated the Tory position ever since. With Kinnock and, subsequently Blair, increasingly aligning Labour with their social democratic allies on the continent (symbolically the social democratic rose, rather than the red flag, serving as the party emblem in recent decades), it has been Britain’s main party of the left, rather than the right, which has sought to identify itself with Europe since the 1980s. Major, Hague and Cameron all sought to sell various forms of Euroscepticism to the British people (Hague running his 2001 election campaign on the slogan ‘in Europe, not run by Europe’), and the Tory Party has a difficult tightrope to walk. Opinion polls have often shown a rather Eurosceptic British public – in 2011 49 per cent of those surveyed in an ICM poll would back a withdrawal from the EU – while, at the same time, Hague’s Euroscepticism would be resoundingly rejected by the electorate in  2001. The UK Independence Party (UKIP) – the one semi-mainstream British party advocating exiting the EU (while maintaining a trading relationship) – has flirted with a breakthrough in recent years, though it is yet to win a parliamentary seat as of April 2013. Even in times of economic crisis, the Cameron Coalition has had to deal with much internal party squabbling on the issue. In January 2013, David Cameron finally snapped – claiming he would renegotiate Britain’s place in the European Union, and then, pending a Conservative victory at the 2015 election, offer an ‘in-out’ vote on membership of the EU by 2017. This intensified rather than quietened cries from both left and right. Britain’s place in the world, and where Europe fits into that equation, continues to dominate the political debate as it did in the epoch of Amery and Churchill.

6

The Conservatives and Local Government: Reform, Localism and the Big Society since 1888 Steven Howell

Listening to the debate in the post-2010 period, the casual observer might imagine that localism and local government have never been higher up the agenda of the Conservative Party in government. Elected, albeit in coalition, on a manifesto espousing a Big Society, local choice and freedom to act, these modern Conservative policies seem a far cry from that of both the previous Labour government and the recent Tory administrations of Margaret Thatcher and John Major. Indeed, a member of the electorate would require a long memory to recall the last government that made a point of embedding localism at the heart of its policy making. This chapter does not seek to analyse the success or sincerity of the Conservative Party (and their coalition partners) in translating electoral and coalition localist promises into reality, but it is uncontrovertibly the case that a number of reforms regarding communities and local government have taken place since May 2010. The longer-term trends are also fascinating. Whereas Labour’s history – and Blue Labour thinkers such as Maurice Glasman are trying to recalibrate its future – is intertwined with a positive narrative of central government intervention (including the post-1945 reforms on public services, the social reforms on decriminalizing homosexuality and abolishing the death penalty in the 1960s, and even in nationalizing the banks after the economic crisis of 2008), the Conservatives have always been more sceptical of the centre, and more willing, as we will see, to empower the local. It is in this context that this chapter seeks to examine, in brief, both past and future for the Conservative Party in terms of localism, local government

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and the Big Society – one of the Conservative’s flagship policies in the 2010 manifesto, aiming to help people come together to improve their own lives. It will explore the key reforms made by Conservative governments with regard to local government structures and finance, considering the potential tensions between Conservative ideals and the practicalities of national government. At its core will be the fundamental question: has the Conservative Party always been a party of localism? Finally, the chapter will conclude by examining in more detail the Big Society movement and by asking whether, after a mixed response from the popular press, it could still be a major part of a Conservative future.

Conservatism and local government – developing local governance as we know it The current tranche of reforms mark only the latest example of Conservatives in government attempting to fundamentally alter the relationship between central and local government, and, indeed, the relationship between the state and the electorate. Arguably, the reforms of the coalition government represent the most radical change in this area by a government in a generation, and perhaps since World War II. However, in order to suggest what the key issues might be for the next round of reform and where this might take the country, this section will examine the lengthy development of central/local government structures and relationships throughout the modern period. As this chapter is part of a collection aimed at a broader audience, and not one specifically aimed at local government experts, it will attempt to avoid the finer points of local government organization and instead offer a flavour of political and policy machinations to the interested reader. There are two key areas to understand: first, the structures and responsibilities of local government – nonsensical to the proverbial ‘man on the street’ and challenging to work with at times; second, the balance of power between central and local government with regard to finance. The importance of structure is obvious, but the vital nature of who finances local government and how that is generated represents a century-long argument that is fundamental to the ability of local government to respond to the needs of its citizens and which is yet to be fully resolved.

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A Conservative approach to organizing power at the local level – the creation of county councils The year 1888 may be a controversial one to begin this chapter among some local government scholars. The first local institutions that could realistically be called government, Justices of the Peace, appeared in the fourteenth century. Indeed, Anglo-Saxon specialists may also have a case for Reeves – latter-day local administrators – being the first such institution. Regardless, 1888 does not mark the date whereby parishes and the like appeared (the seventeenth century) nor even the creation of the first ‘local authorities’ under the Municipal Reform Act of 1835. However, this chapter contends that the Local Government Act 1888 represents a milestone in the history of Conservative local government, seeing as it did the creation of elected county councils and county borough councils under Lord Salisbury. This fundamentally influenced 50  years of structural twists and turns while providing some of the most contentious debate among local government leaders well into the twenty-first century. Creating directly elected institutions covering the country in the order of 62 county councils and 61 county boroughs, the 1888 Act brought into being much of the structure that can still be seen in local government today. While brought in under Lord Salisbury, the impetus initially came from the Liberal Unionists led by one of the most well-known local government leaders in English history, Joseph Chamberlain.1 However, the Bill was introduced by the Tory Charles Ritchie, then President of the Local Government Board, with local governance through county councils becoming a key part of Conservative local government. However, the creation of county borough councils – all-purpose authorities that were not reliant on their surrounding counties – meant that the two were in direct conflict for resources and control from their very creation. The size of county councils was not standardized, hence many existed on the borderline of viability, particularly if population and funding was devolved to county boroughs.2 This tension continues to the present day, at both the national and local level. 1

2

B. Keith-Lucas, The Government of the County in England, The Western Political Quarterly, 9/1 (1956), 46. The Liberal government’s Local Government Act 1894 introduced district councils, further complicating the picture.

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A number of attempts were made by successive governments of all parties to reform what appeared to be a complex and diverse system of local government. The government of Edward Heath, upon election in  1970, abandoned the majority report of a Royal Commission into local government structural reform. While the majority of the commission had argued for predominantly unitary government, the newly elected Conservative government proposed reform along two-tier lines, later introduced through the Local Government Act 1972, retaining a reduced number of county councils while abolishing county boroughs. With the exception of newly created metropolitan county councils (subdivided into metropolitan districts) in the six major urban conurbations of Greater Manchester, Merseyside, the West Midlands, Tyne and Wear, South Yorkshire and West Yorkshire, county boroughs were replaced by district councils, with services such as social care and education subsumed into their parent counties. Conservative policy had tended to support stronger counties, but the underlying tensions vis-a-vis the nowabolished county boroughs and reformed district councils fuelled ongoing debate.3 A generation later, further reform was attempted by the Conservatives via the widespread introduction of unitary councils in the early 1990s.4 Michael Heseltine was a firm supporter of unitary governance, while his successor as Secretary of State for the Environment (responsible for local government), Michael Howard, was less keen. The introduction of unitary councils resolved tensions in some areas but created new problems of coordination and cooperation in others. Despite an increasingly diverse spread of governance arrangements across England, county governance has remained in use throughout a century and a quarter of reform and represents the cornerstone of Conservative local government.

The balance of power between central and local government – financing local governance In terms of their responsibilities, the early county and county boroughs had limited powers, initially including ‘highways and bridges, asylums, weights and 3 4

D. Wilson and C. Game, Local Government in the United Kingdom (Basingstoke, 1994), 58. With a second wave created under Labour in 2009.

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measures and partial control of the police’.5 Further responsibilities were granted to these authorities via the Education Act of 1902, introduced by the soonto-be Conservative Prime Minister Arthur Balfour, transferring responsibility for education to local authorities. The introduction of the Act continued the concentration of powers at the county and county borough level. Perhaps the high point of county power came under Stanley Baldwin with the last of the preSecond World War changes as part of the Local Government Act of 1929 (largely piloted by Joseph’s son Neville Chamberlain). Though Chamberlain’s foreign policy would later see his reputation tarnished, through his steering of the 1929 Act he helped ensure increased power to local government through transfers of poor law functions, civil registration and hospitals; while counties also took on the responsibility for those highways that had briefly been the responsibility of rural districts. The following decade marked the highpoint for local government and has been described elsewhere its ‘golden age’.6 However, a distinct policy shift following World War II, and specifically regarding how local government was financed, was a major change in the balance of power between central and local government. In the late 1940s, a trend began that saw local government lose responsibilities to central government and its agencies, including health, social security and the responsibility for building ‘the New Britain’ through the New Towns Act of 1946.7 But perhaps more important, in terms of judging local autonomy, was the policy shift towards central control over local finances. The Local Government Act of 1948 transferred responsibility for rating valuations from local authorities to central government. This had the primary effect of limiting the ability of local authorities to control their most vital source of funding and respond to changing local conditions and pressures. But the secondary impact of a centrally controlled system meant that key elements of maintaining a sustainable funding mechanism, such as regular revaluations, could be delayed as a result of popular pressure on the government of the day. This only had the effect of exacerbating the underfinancing of the sector and delaying the inevitable.8

5 6

7 8

Local Government in the United Kingdom (1994), 53. T. Byrne, Local Government in Britain: Everyone’s Guide to How It All Works (Harmondsworth, 2000), 21 in Local Government, 55. S. Jenkins, Big Bang Localism (London, 2004), 37. T. Travers and L. Esposito, The Decline and Fall of Local Democracy (London, 2003), 37–8.

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An attempt was made to rectify the issue by the then-Conservative government through a 1957 White Paper, the stated aim of which was ‘to increase the independence of local authorities in the raising and spending of their money so far as it is practicable to do so’.9 The proposals increased the local tax base by raising rates for industry from 25 to 50 per cent. By increasing locally raised revenue, the changes in the Local Government Act of 1958 did improve the situation somewhat, but commentators have argued that it ‘failed to make the fundamental changes to the rating system which would prevent future crises, and essentially just postponed the issues surrounding revaluation to another time’.10 While Conservative rhetoric certainly emphasized a move towards greater autonomy, particularly when set against the concerns of the opposition to the Act, there was no fundamental change to an increasingly centrally controlled local finance system. Returning to the 1972 structural reforms, the Conservatives again promised much: ‘the aim will be to devolve to local government as much responsibility as possible.’11 However, no long-term solutions were forthcoming and the underlying weaknesses remained unsolved. A committee appointed in the intervening months between the two elections of 1974, known as the Layfield Committee, reported in  1976. It concluded its findings with the following statement: ‘the only way to sustain a vital local democracy is to enlarge the share of local taxation in total local revenue.’12 Again, no reforms of significance were made as a result of the report, despite the strong message that local government should raise a greater proportion of its revenues from local sources, which would set the tone for more significant reforms to come under the subsequent Conservative government. Despite a history of broadly positive messages, if not policies, coming from previous Conservative governments, the Thatcher and Major years marked a seismic shift in both rhetoric and policy. The view of local government by the Thatcher government was summed up quite simply in how her Ministers once described the sector: ‘wasteful, profligate, irresponsible, unaccountable, luxurious and out of control.’13   9

10 11

12 13

Local government finance, Cmnd 209 (London, 1957) as quoted in The Decline and Fall of Local Democracy (2003), 38. The Decline and Fall of Local Democracy (2003), 39. Local Government in England: Government proposals for reorganization, Cmnd 4584, 1971 as quoted in The Decline and Fall of Local Democracy (2003), 43. Report of the Committee of Enquiry into Local Government Finance, Cmnd 6543 (London, 1976), 301. K. Newton and T. Karran., The Politics of Local Expenditure (Basingstoke, 1985), 116.

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The Thatcher government wished to control and reduce public expenditure, relying on the ability to penalize local authorities for exceeding centrally allocated spending targets. Continued defiance from some authorities led to the Rates Act of 1984, which enabled central government to cap council budgets, and an indirect cap on control over rates – the last vestige of control over local revenue.14 However, this was nothing compared to the storm that would erupt over the next major financial reform, the introduction of the Community Charge – known in common parlance as the Poll Tax. The reforms to local government finance in 1990 represented a catastrophe for central and local government relations in two respects: first, the nationalization of business rates represented the single biggest land grab by central government from local government of all time in cash value terms, totally some £12bn (at the time) annually.15 Secondly, there were significant consequences for Conservative politics and central government relations with local government in particular. Tony Travers has presented such a succinct and relevant account of the impact that I repeat it here: ●

●

●

●

●

●

14 15 16 17 18

The average tax bill was £363 which was far in excess of the prior year estimate of £275, with there being three times as many losers as gainers.16 In its year of implementation in Scotland, one third of all poll tax bills went unpaid. Despite giving local authorities the autonomy to raise extra income via the poll tax in the hope that in the event of future rises the focus of taxpayer wrath would be aimed at the local councils, the publicity associated with the introduction of the poll tax caused voters to aim their anger at rising bills towards central government. Rising inflation and central squeezing of grant levels put upward pressure on poll tax bills, increasing the public anger towards the tax even more. In the 1990–91 fiscal year, there were 4.1 million summonses for nonpayment,17 and massive poll tax demonstrations took place which shook the central government and contributed to the resignation of Mrs Thatcher. In the 1991 budget, VAT was raised by 2.5 per cent to help centrally finance an across-the-board cut in individual poll tax bills of £140.18 Decline and Fall of Local Democracy, 51–2. Big Bang Localism, 39. Local Government in the United Kingdom, 207. A. McConnell, The Politics and policy of local taxation in Britain (Cambridge, 1999), 41. Decline and Fall of Local Democracy, 54.

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The failure of such a bold attempt at reforming local government finance did little to encourage further attempts, with the end result being that locally determined expenditure fell to just 15 per cent by 1992/3.19 Despite all the effort and reform, the Conservatives ultimately developed an incredibly centralized system of financing local government. A dependency on specific grants meant that local government acted more like an agent for central policy, ever dependent on the money that was associated with it, rather than having free reign over service provision. Tony Blair’s Labour government would face regular accusations of having engendered a ‘target culture’, but much of the blame for the complex and centralized system of local government can be laid at the door of recent Conservative government policy. The current Coalition government has taken a fresh look at the local government finance system, with revised arrangements coming into effect from April 2013. The key plank of their reform has focused on the local retention of business rates and on providing a systemic incentive for councils to promote business growth. As stated, this chapter seeks not to judge the success of these reforms – nor would it be fair to do so before (at the time of writing) they have been implemented – but merely to place them within a historical context. As we have seen, the trend has been for increased centralization over the past 50 years. The 2010 Conservative Manifesto shares this belief, conceding that ‘over the last forty years, governments of all colours have been guilty of weakening local government’.20 Following the election, the Coalition government has made a significant break with this trend. Business rates will be split into central and local shares; the former will be retained by central government to fund other local government services, while the latter is retained locally. The exceptions to this are a series of ‘tariff ’ and ‘top-up’ payments, effectively an equalization measure from areas with a high amount of business rates received, to other areas. Local authorities will also be able to retain a set amount of any growth in business rates, as determined against an established baseline, in theory reset every 10 years. This is a far cry from the days when local authorities collected and retained their own rates, nor does it meet the recent calls from prominent local government commentators as Tom Shakespeare for authorities to ‘buy-out’ of central 19 20

Local Government in the United Kingdom, 208. ‘Invitation to join the government of Britain’ Conservative Manifesto 2010, 73, http://www. conservatives.com/~/media/Files/Activist%20Centre/Press%20and%20Policy/Manifestos/ Manifesto2010

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redistribution entirely, but it does provide a certain level of retention, while protecting authorities which would struggle if dependent solely on a business rate mechanism.21 The current policy reverses, in part, the centralization of the Thatcher and Major years, but how well it will be received by local government leaders of all colours remains to be seen. Alex Thomson, the Chief Executive of think tank Localis, has called the move ‘a step in the right direction’, but contends that fuller local autonomy remains the end goal for many in the local government community.22

The Conservatives and localism as a philosophy – Cameron’s construct? In his foreword to the 2010 Conservative manifesto, David Cameron set out a profoundly localist view of a Conservative government under his leadership: ‘Our fundamental tenet is that power should be devolved from politicians to people, from the central to the local.’23 A year earlier, the Conservatives had launched a localism green paper, Control Shift: Returning power to local communities, which argued that ‘over the last century, Britain has become one of the most centralized countries in the developed world. Under Labour, this trend has accelerated’.24 It made the case for substantial reform across government in order to truly empower local communities. This was certainly the most overt and comprehensive push towards the localism of any recent Tory leadership that had succeeded in forming a government. However, this section of the chapter will, albeit briefly, consider whether this new localism was a natural evolution of the party’s agenda or whether it was truly Cameron’s construct. The 2010 manifesto proposals, the vast majority of which were incorporated into the government’s Coalition Agreement, were a firm step towards a more localist state, and I attempt to summarize them here as briefly as possible. In the communities and local government sphere, the attempt to streamline and localize 21

22

23 24

See T. Shakespeare and T. Simpson (ed. Alex Thomson), The Rate Escape: Freeing Local Government to Drive Economic Growth (London, 2011), passim. The Shakespeare-Simpson-Thomson model is voluntary in nature and also included an emergency fund set-aside for those authorities hit by some unexpected maelstrom. Guardian Local Government Network, 23 October 2012, http://www.guardian.co.uk/localgovernment-network/2012/oct/23/local-government-business-rate-retention Conservative Manifesto 2010, vii. Control Shift: Returning power to local communities, Conservative Policy Green Paper No. 9, 2009, 5, http://www.conservatives.com/~/media/Files/Green%20Papers/Localism-Policy-Paper.ashx

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the planning system was perhaps the most significant of these reforms. Through introducing a presumption in favour of ‘sustainable development’, streamlining guidance and placing a strong focus on neighbourhood engagement, the proposals represented an attempt to reform the monolithic planning framework. The proposed abolition of regional targets for house building and the strategies that contained them, the Regional Spatial Strategies, would give local planning authorities the responsibility of planning for an appropriate quantity of housing in their area. Furthermore, what later became the ‘community right to bid’ and ‘community right to challenge’ empowered residents and employees, giving them the chance to seek to protect valued assets or take over local public services, respectively. Finally, the party proposed to free local authorities from central bureaucracy via the abolition of Labour’s centralized performance management system, the revocation of many ‘ring-fenced’ grants25 and the introduction of a general power of competence (allowing local authorities to do anything that is not specifically prohibited by legislation).26 Localism was arguably a ‘fundamental tenet’ in a number of other areas. Greater local influence was to be introduced as part of the Conservative Party’s health reforms, giving groups of local GPs the power to commission health services. Schools were to be given more independence and freedom from the decision-making powers of ‘bureaucrats’.27 Local police budgets and strategy were to be set by directly elected Police and Crime Commissioners. Again, this chapter seeks not to judge the success of these schemes or analyse just how ‘localist’ they are, but to consider how they developed. It is also worth pausing at this stage to note that not all of these ‘localist’ proposals were designed to give more power to local government. For example, the proposed education reforms would in fact remove powers from local government. More localism does not necessarily mean more power and responsibility for local government. This manifesto was written with plenty of localist gusto, shaped by a number of factors. Perhaps the first and most obvious is the reaction against the policies of the previous Labour government. Here is what the 2010 manifesto said of the then government: ‘Bureaucratic control has replaced democratic accountability. The wishes of local people are second-guessed by bureaucrats; the activities of councils are 25 26

27

Grants which are only able to be spent on a particular service, based on selected criteria. Previously, local authorities could only act or deliver services if they were specifically allowed to do so by legislation – to act beyond this was known as acting ultra vires. Conservative Manifesto 2010, 51.

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micro-managed by unelected quangos. This hoarding of power by distant politicians and unaccountable officials in Whitehall has damaged society by eroding trust.’28

One would expect a certain amount of posturing from political parties vying for election, attempting to differentiate themselves in an age where, as one BBC editor commented, ‘reading their manifestos may, for many, amount to a spotthe-difference competition’.29 However, the fact that these policies have made it into existence, and that localism is not exactly a high-profile issue compared with the economy, health or crime (though of course it has implications for all these), suggests that this is more than just the Conservatives taking the opposite position to Labour for the sake of electoral pragmatism. The second part of this argument lies in a reference from the localism green paper, Control Shift, which expressed the belief that while ‘central control’ had accelerated under the previous government in some sense, New Labour had but swum with the long-term tide: ‘over the last century, Britain has become one of the most centralized countries in the developed world.’30 Even in the midst of pre-election rhetoric, the Conservatives acknowledged here and elsewhere that decades, if not perhaps a century, of centralization had occurred in the United Kingdom. Certainly, the most significant turning point was likely the post-Second World War centralization by the then Labour government. As two local government historians put it, Labour’s ‘massive programme of health, welfare and nationalization, all . . . took services away from local councils.’31 The Communities and Local Government Select Committee agreed: ‘England is one of the developed world’s most centralized democracies. The centre controls virtually all taxation, and power has followed money. Over the period since 1945 power and authority have moved upwards within the English political system.’32 As discussed elsewhere, while Conservative policy under Heath was localist in tone, if not in action, the Thatcher and Major years did little to stop this centralization. Clearly, there was a distinct policy trend that the 2010 manifesto sought to diverge from. However, the history of localism in the Conservative Party runs much deeper. David Cameron hints at this himself in his foreword to the 2010 manifesto: 28 29

30 31 32

Conservative Manifesto 2010, 73. ‘Do we care about party politics?’, Mark Easton, BBC Online, 26 January 2010, http://www.bbc. co.uk/blogs/thereporters/markeaston/2010/01/do_we_care_about_party_politic.html Control Shift: Returning power to local communities (2009), 5. Local Government in the United Kingdom (1994), 55. The Balance of Power: Central and local government, Sixth Report, HC 33-I (London, 2009), 7.

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‘As Conservatives, we trust people. We believe that if people are given more responsibility, they will behave more responsibly. We believe that if you decentralize power, you get better results and better value for money. So the plans set out in this manifesto represent an unprecedented redistribution of power and control from the central to the local, from politicians and the bureaucracy to individuals, families and neighbourhoods.’33

The full quote is included to represent the strength of localist feeling, but the key point is the reference in the first sentence. This history of trust and individual choice dates back to the earliest principles of conservatism. Much of this is discussed elsewhere in this book, but I will repeat a single quote from elsewhere in this tome: ‘real virtue can only grow if men have enough liberty in which to exercise choice and develop their characters.’34 Via Lord Salisbury and Arthur Balfour, current Conservative policy is derived from a century-old philosophy at the heart of Conservative idealism. Given that the Conservative Party is the oldest political party in the world, it has some claim to being the natural party of localism.35

The Big Society and beyond The final section of this chapter looks at one of the key manifesto policies of the Conservatives in 2010 that has dwindled in popular press coverage. It examines the background to some of the intrinsic themes, asking to what extent is the Big Society a reflection of traditional Conservative themes, briefly covering the current situation and then looking beyond this to what the future may hold for Cameron’s Big Society. The Big Society has received much coverage since the Coalition took office, and it is important to recall the definition and rationale the Tories gave it in 2010: ‘we need fundamental change: from big government that presumes to know best, to the Big Society that trusts in the people for ideas and innovation.’36 In some sense then, this was intended to capitalize on a very twenty-first-century combination of scepticism with government, rapid technological advance which was empowering the everyday citizen, and a 33 34 35

36

Conservative Manifesto 2010, ix. P. Goldman, Some Principles of Conservatism (1956), 13. The impact of the Liberal Democrat party on the Coalition’s devolution agenda is an interesting topic for debate, but alas not for discussion here. Conservative Manifesto 2010, viii.

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perceived entrepreneurial ethos that was lying dormant in the British people. However, like localism, this is perhaps not quite so new a concept as the casual observer might imagine. The history and development of the Big Society has been covered in depth elsewhere, hence this chapter highlights but a few such influences. The Conservative election manifesto of 1931 – likewise written soon after a global economic crash – contained surprisingly familiar rhetoric to that seen in 2010. Entitled ‘the nation’s duty’, Stanley Baldwin’s manifesto spoke of ‘sacrifices from every class of community’, ‘all must help’, and that the National Government had ‘with your help accomplished the first part of its work’.37 This chimes well with the question asked in 2010: ‘how will we revitalize communities unless people stop asking “who will fix this?” and start asking “what can I do?” ’38 While Mr Baldwin was speaking of a national (coalition) government in a time of national crisis, some of the language rings true in 2010. In fact, the 1931 manifesto won the Conservatives a landslide victory. In an age of significant spending reductions, particularly to local public services, it is a difficult message to put to a sceptical electorate. In any case, political commentators have drawn parallels between Mr Baldwin and Mr Cameron,39 and the ‘we’re all in this together’ attitude shared by both men may have helped influence the latter’s thinking behind the Big Society. Of course, there remain plenty of other examples. ‘We believe there is such a thing as society, it’s just not the same thing as the state’ is the twenty-firstcentury equivalent.40 However, an emphasis on self-sufficiency appears as a Tory principle as far back as 1913.41 Again, this chapter could cover the Thatcher years in much more detail, but these are touched on elsewhere in this volume. Suffice it to say that much about the Big Society harkens back to earlier principles – about the ‘get up and go’, aspirational ethos of conservatism, its belief that society (often, in practise, rather a small entrepreneurial subset of it) drives the nation forward better than the unwieldy state does, and that personal responsibility is best engendered through civic action. Some of the rationale behind the concept came from looking across the channel to France and Germany where 37

38 39 40 41

Conservative Party General Election Manifestos 1900–1997, vol. 1, ed. Iain Dale (London, 2000), 51–2. Conservative Manifesto 2010, iii. http://www.guardian.co.uk/politics/wintour-and-watt/2011/dec/29/edmiliband-davidcameron Conservative Manifesto 2010, vii. K. Feiling, Toryism: A Political Dialogue (1913), vi, 98.

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empowered local governments enjoyed far greater powers. Tories do not often look to Europe for positive inspiration, but the lowest tier of local government representing an average of around one and a half thousand people in France, five thousand in Germany, and, by contrast, a mammoth one hundred and twenty thousand people in Britain represented a major imbalance. Into this intellectual space entered the Coalition – including, of course, a Liberal Democrat Party which had also worn subsidiarity – devolving power to the lowest appropriate level, in non-policy wonk jargon – on its sleeve at times. The Coalition government categorizes the Big Society into three distinct themes which call this heritage to mind: community empowerment, opening up public services and social action. The first includes the local government and localism policies outlined elsewhere in this chapter. The second consists of the opening up of public services to new forms of service delivery, alongside the government’s welfare reforms. Local government is at the forefront of public reform in this respect, with roughly a third of local government services provided by external partners, be they through private sector, voluntary sector or employee mutual-based arrangements.42 The welfare-to-work programme is still very much in development and it remains to be seen how this will affect the country. The third section includes the National Citizenship Service pilots, involving 16- and 17-year olds in outdoor challenges and community projects with the aim of improving civic engagement and boosting individuals’ employment prospects. The government also intends to train 5,000 Community Organizers who are intended to support and develop community projects across the country (interestingly enough, US President Barack Obama was once a similar such community organizer). This was, and is, easier said than done. Implementing the highest levels of public spending reductions in living memory was undoubtedly going to make fundamentally altering the relationship between individual and state problematic, particularly when more is being asked of the individual. However, many of the Big Society strands are developing in their own right. If one agrees that Conservatives are naturally pre-disposed to the philosophy behind the Big Society, then there is no reason to doubt that it can sustain itself in some form. Indeed, there are a number of areas where some of this thinking, or related thinking, is developing in new directions.

42

D. Crowe, Catalyst Councils: A new future for public service delivery (London, 2012), 14.

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Current thinking is focusing not just on public service structures, but also on mentality and new ways of framing a service. Richard Thaler and Cass Sunstein, in their critically acclaimed Nudge, highlight some big state issues in a refreshingly modern context. They begin their book by citing a hypothetical situation seemingly far removed from the aegis of government: a friend of yours, Carolyn, found that by reorganizing the location of different foods in her school cafeteria, she could influence what the visiting children ate. Should she arrange the food so that the children are ‘best off ’ or should she arrange them at random?43 Both have downsides. The first may be considered ‘paternalistic’ and the second could, if replicated across multiple schools, result in children in some areas being healthier than others on a random basis.44 The core of their argument hinges on the supposition that ‘people have a strong tendency to go along with the status quo or default option’.45 A ‘nudge’ is something that ‘alters people’s behaviour in a predictable way without forbidding any options or significantly changing their economic incentives’.46 Indeed, the same minds that helped dream up the Big Society encouraged the development of a ‘Nudge Unit’, also known as the Behavioural Insights Team, at Number 10 Downing Street. This type of thinking may well develop and expand over time – the team is due to provide consultancy services for the New South Wales government in Australia.47 Nudge thinking has potential across all public services and, like the Big Society ideal, represents a move away from ‘doing’ things ‘to’ people in a set and centrally determined way to enable citizens to take socially desired action themselves. Innovative thinkers such as Dominic Rustecki have explored the potential to create a Big Green Society by harnessing the ability of local government to connect with ordinary people – Rustecki pointing to the potential for ordinary people to take responsibility for the cleanliness of their neighbourhoods if they are ‘nudged’ in that direction by local councils reallocating budgets, making use of smartphone technology and getting local businesses on side.48 The danger for the Conservatives, as has been the case since they took office, is that a sensible idea most would 43

44 45 46 47

48

There were, of course, other choices – such as maximizing profit and responding to the largest bribe from the supplier – I have paraphrased the authors. R. Thaler and C. Sunstein, Nudge (Yale, 2008), 1–2. Nudge, 8. Nudge, 6. ‘Nudge unit’ defies with overseas contract, The Financial Times, 19 September 2012, www.ft.com/ cms/s/0/79380da8-026c-11e2-8cf8-00144feabdc0.html D. Rustecki, Big Green Society: Empowering Communities to Create Cleaner, Greener Neighbourhoods (London, 2011), passim.

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welcome – people becoming civically engaged – is closely associated in the popular mindset with the widespread cuts in public services seen since the 2010 Comprehensive Spending Review. It has proved a tough balancing act. Others are re-examining the fundamental basis of the state itself. For example, Graham Allen, the Labour MP and Chair of the Political and Constitutional Reform Committee, has led the drawing up of a draft code for local government, setting out the principles and mechanics of the relationship between central and local government. This would enshrine, for the first time, the right of local government to exist independently, responsible to its citizens and not to central government. This is intended to encourage a shift towards a more continental model, where residents are much more engaged in their local political institutions and the services that they provide. Again, this could be the catalyst that transforms the relationship between citizen and state. By codifying minimum terms of reference between the centre and the local, it would also of course partially reduce the see-saw effect of Conservative governments predominantly localizing (with centralizing exceptions seen under, for example, Thatcher) and Labour governments predominantly centralizing (with localizing exceptions – even Gordon Brown’s government preparing to legislate for local authorities to have Tax Increment Financing powers in its final year in office) that has marked British politics.49 However, what will appear in the Conservative 2015 manifesto as regards the Big Society remains particularly unclear. Given the return to traditional roots in  2010, one would expect to see further localism and devolution. Whether the country will see a return to something akin to the early nineteenthcentury position, where parishes appointed their own highway surveyors et al and commissioned local works directly, remains to be seen. Whether too the intellectual and political capital that the Conservatives have put into the idea can survive accusations that the Big Society is a cover for spending cuts, and see a political consensus emerge around the issue, is far from certain. Blue Labour – Maurice Glasman’s call to arms for local institutions such as co-ops, football clubs and religious groups to reassert themselves into local communities – is still fledgling, though Ed Miliband has flirted with supporting its ideals at times, not least in his ‘One Nation’ speech to the 2012 Labour Party conference. The dividing line between state and citizen, personal responsibility and a central 49

Tax Increment Financing involving the borrowing against future tax rates (in the British case business rates) for current capital projects.

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‘safety net’ in core areas, and how the private and third sectors fit into such debates remain questions that all parties will continue to face.

Conclusion Just how localist the Conservatives are is a question that would take much longer than this chapter to thoroughly assess, but how much they believe in local government can be considered in far fewer words. The view of the Thatcher government was clear, as illustrated above. Indeed, even Michael Heseltine – a great supporter of local self-determination – established Urban Development Corporations that essentially bypassed local authorities as democratic arrangements were ‘making a mess of it’ and took too long.50 Indeed, this attitude was perhaps responsible, in part, for a collapse in the numbers of party membership. From 1979 to 2001, the number of Conservative Party members fell from 1.35 million to 325,000, while the Labour and Liberal Democrat Parties lost only half their membership. Of course, this could be attributed to a crisis in more general terms, but given the close links between local foot soldiers and council members, it likely represents in part a disillusionment with what Thatcher and Major did to local government.51 Was this period simply a blip? Arguably, yes. As this chapter seeks to demonstrate, modern conservatism is particularly localist and encouraging of local government, but it has its roots deeply embedded in its nineteenth- and early twentieth-century beginnings. However, the problem with localizing measures is that they often come in times of economic crisis. For example, between World War I and World War II, unemployment was regularly above 10 per cent of the labour force, and under the current government, 2.5 million are unemployed, including 1 million young people. Localism and devolution of power to local government remains a challenge, and particularly to achieve this popularly, in such a climate. However, hope remains. Joseph Chamberlain (though a Liberal Unionist)52 still constitutes, in many Conservative minds, a local government hero for his time as Mayor of Birmingham. Under his stewardship, his authority purchased

50 51 52

Big Bang Localism, 40. Big Bang Localism, 44–5. Of course, the Liberal Unionists would soon after merge with the then Conservative Party.

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utilities and improved street lights, public health and public transport. The entrepreneurial spirit inherent in local government, and indeed in local communities and individuals, has been demonstrated before and will do so again. It is up to the modern-day Conservatives to remember this and continue along the localist path set by their political ancestors.

Section Four

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7

Coalition Blues: The Conservatives, the Liberals and Conservative-Liberal Coalitions in Britain since 1895 Chris Wrigley

In the half century from 1895 to 1945, the Conservative Party was more often in office with some Liberal support, some 64 per cent of the time, than on its own. In contrast, the Liberals supported Labour in office about 6 per cent of this half century or were in coalition with the Labour Party 18 per cent of the time (ignoring such Labour splinter groups as Coalition Labour and National Labour). In great contrast, the Conservatives did not operate in office with Liberal direct or indirect support from 1945 until 2010, although Ted Heath sought Liberal backing to remain in office after the February 1974 general election. In the 1895–1945 period, the circumstances of coalition varied greatly, both in the composition of the coalitions and in the major issues that they confronted. However, there were similarities of circumstances for the major periods of coalition. In 1915–20 and 1940–45, the coalitions were created for the purpose of waging major wars more effectively. In  1915, the coalition was created to strengthen a lacklustre Liberal government and to ensure agreement on extending the life of the 1910 Parliament. In 1940, the coalition was similarly created to strengthen the lacklustre Conservative-dominated National government under a new Prime Minister and to ensure agreement on extending the life of the 1935 Parliament. There were more reasons for both changes, but these were notable similarities. In 1931, in the developing economic crisis, the collapse of the 1929– 31 Labour government led to Ramsay MacDonald agreeing to lead a National Government which in October 1931 secured a massive majority of 493 (470 Conservatives, 33 Liberal, 35 Liberal National, 13 National Labour, 3 National, a total of 554 against 61 others). In  2010, after the defeat of Gordon Brown’s

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Labour government in the midst of the unfolding ‘credit crunch’ international crisis, David Cameron and the Conservatives failed to win an outright majority and, after 5  days of negotiations, formed a coalition government with the Liberal Democrats (Conservatives 306 seats, Lib Dems 57, providing a 76 seat overall majority). This was the first formed coalition since 1945, and the first arising immediately from a general election result for well over a hundred years. In 1921–22, the severe recession damaged the post-war Lloyd George Coalition and was one of several issues that led to its fall. In two instances, the coalition was a prelude to merger. This was so with the Liberal Unionists. The Liberal Unionists were a major breakaway group from the Liberal Party, with top-ranking politicians as leaders, (Lord Hartington, later the Duke of Devonshire, and Joseph Chamberlain). The return of the issue of protection in  1903 led to Devonshire’s break with Balfour’s Conservative government and with Joseph Chamberlain. Several Liberal and Conservative free traders went to the Liberal Party. The remaining part of the Liberal Unionists merged in 1912 with the Conservatives, before long to be known as the Conservative and Unionist Party.1 The other case was of the Liberal Nationals (later National Liberals) who were a small part of the National governments of 1932–45 and a few of whom served in minor roles in the Conservative governments of 1951–64. The Liberal Nationals were led from 1931 until 1940 by Sir John Simon, who served as Foreign Secretary (1932–35), Home Secretary (1935–37), Chancellor of the Exchequer (1937–40) and Lord Chancellor (1940–45). Many Liberals on the Right of the party had been dismayed by the Parliamentary Liberal Party’s support for the first Labour government, 1924. A few then even hoped Churchill would be the leader of anti-Labour Liberal forces, but he very soon returned to the Conservative Party.2 This role was taken over by Simon who had long been vehemently critical of socialism. He had later observed of the Liberal Nationals that they were ‘resolutely opposed’ to the Labour Party’s socialism which ‘was bound to pursue a policy which threatened individual liberty and private enterprise’. Hence, he believed that ‘the Liberal outlook was now so largely shared by the modern Conservatives that the things in which Liberals believed would best be promoted by co-operating with the main party which resisted

1 2

For a full account see Ian Cawood, The Liberal Unionist Party: A History (I.B. Tauris, 2012). Algernon Moreing and George Yarrett (former MPs) to Churchill, 5 February 1924. Churchill Papers, Churchill College, Cambridge, CHAR 2/13/29–31.

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the Socialists’.3 After the 1945 general election, Simon approached Churchill for a merger with the Conservatives. By 1947, there was growing friction with the local Conservative Associations in the Liberal National constituencies. Lord Woolton reported to Churchill that in two such constituencies Conservative candidates ‘have already been adopted against our advice’ and that the majority of others are becoming very restive and want to put up their own candidates. He added that the Liberal National MPs ‘have been carried on the support, the votes, the work of the Conservatives’ and urged the necessity of the Conservative leadership taking action to avoid ‘drift’ and the situation getting ‘out of hand’.4 In 1947, the Conservatives and Liberal Nationals did not go as far as merging but agreed reciprocal constituency membership.5 This concern to maintain the National Liberals by Churchill and the Conservative Party leadership was a major part of their efforts to hold or to gain the support of former Liberal voters. This was deemed to be especially important given the 1945 general election Labour landslide and the very high Labour votes of 1950 and 1951. In  1950, Clement Davies, the Liberal Party leader, complained to Churchill that at least four Conservative associations had rebranded themselves as ‘United Liberal and Conservative Association’, even when no Liberals were participating. Churchill’s lengthy response included the observation that ‘it is natural and proper that Conservatives and Liberals who conscientiously are opposed to Socialism should join together in this crisis in whatever seems the most effective way in order to resist the common danger to our country.’6 Just over a week earlier, Churchill had offered his old friend Violet Bonham Carter one of the five Conservative general election broadcast slots to say whatever she liked provided it was anti-Socialist. She reluctantly turned down the offer, in this encouraged by the horror of the Liberal Party leadership and by her own feeling, as she put it in her diary, that she would be regarded ‘as a Quisling, a Tory puppet, a ventriloquist’s doll’. After the 1950 3

4

5

6

Viscount Simon, Retrospect (Hutchinson, 1952), 171. Simon’s 1923 speech on Socialism was conveniently reprinted in 1930 in Sir John Simon, Comments and Criticisms (Hodder and Stoughton, 1930), 56–78. Lord Woolton to Churchill, 4 February1947: Churchill Papers, CHUR 2/65/2–4. This letter is in a large file on co-operation with the National Liberal Party, 1947–59. David Dutton, Simon: A political biography of Sir John Simon (Aurum, 1992), 314. For a valuable study of the Liberal Nationals, see David Dutton, Liberals in Schism: A History of the National Liberal Party (I.B. Tauris, 2008). Roy Douglas, Liberals: The History of the Liberal and Liberal Democrat Parties (Hambledon, 2005), 225–41 and 253–4. David Dutton, A History of the Liberal Party (Palgrave, 2004), 124–31 and 159–60. Churchill to Davies, 25 January 1950; quoted at length in Martin Gilbert, Winston S. Churchill, Volume 8: Near Despair 1945–65 (Heinemann, 1988), 503–5.

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general election, Churchill had R. A. Butler investigate common ground for collaboration with the Liberals in the next general election, but this came to nothing as the Conservative Party was hostile to proportional representation. Churchill did speak for Violet Bonham Carter as the Liberal candidate with no Conservative opponent at Colne Valley in the 1951 general election, having earlier narrowly convinced (33 votes to 26) the local Conservative to give her a free run as the sole anti-socialist.7 The National Liberals continued to do well as anti-socialist allies of the Conservative Party both before and after Churchill retired as Prime Minister. Where 11 had been elected in  1945, the numbers increased from 16 in  1950 and 19 in  1951 to 21 in  1955 and 20 in  1959, before crumbling to 6 in  1964 and 3 in  1966 (after which, in  1968, the National Liberals merged with the Conservative Party).8 Michael Heseltine was among later leading Conservatives who sought to benefit from former Liberal voters, standing as the National Liberal and Conservative candidate for Gower in 1959. Another was John Nott, who was elected as the National Liberal and Conservative candidate for St Ives in 1966, being told by ‘the local association that St Ives could not be won by a Conservative’.9 Tensions over the spoils of office as well as over policies were still very marked even when coalition partners were moving together, as in the 1890s. While the Liberal Unionists had informally kept Lord Salisbury and the Conservatives in office in 1886–92, the two parties moved closer together ahead of the 1892 election, holding more formal joint meetings (as opposed to individual meetings). After the Conservative defeat in the 1892 general election, Joseph Chamberlain pushed for the Conservatives to put forward a substantial social reform package in order to upstage the Liberals. Salisbury rejected this, expressing his customary disdain for the efficacy of such measures.10 Nevertheless, Salisbury did court the Liberal Unionists in  1895. After Rosebery’s resignation, Salisbury took office before the general election and sought Liberal Unionist participation in office. Earlier, in December 1894, he had paved the way by entertaining Chamberlain and his wife at Hatfield House.   7

  8

  9

10

Mark Pottle (ed.), Daring to Hope: The Diaries and Letters of Violet Bonham Carter 1946–69 (Weidenfeld and Nicolson, 2000), 77–9, 88–92 and 99–101. Gilbert, Churchill, 601 and 646–7. ‘The National Liberal Vote, 1931–66’, Appendix 2, Chris Cook, A Short History of the Liberal Party 1900–1976 (Macmillan, 1976), 170. Michael Heseltine, My Life in the Jungle: My Autobiography (Hodder and Stoughton, 2000), 47–57. John Nott, Here Today, Gone Tomorrow (Politicos, 2002), 125–6. Richard Shannon, The Age of Salisbury 1881–1902 (Longman, 1991), 374–84.

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The 1895 general election provided Salisbury with a purely Conservative small majority, but with the Liberal Unionists in coalition his position was secure with a majority of 152. Chamberlain’s choice of the Colonial Office brought him close to Salisbury’s prime concerns and it turned out they would frequently be in harmony. This avoided the friction with Salisbury and the Conservative Right that would be likely if he had taken a domestic office. Chamberlain pursued his imperial policies but was frustrated in his much desired Workmen’s Compensation Bill, 1897, by continuing Conservative insistence on contracting out. His hopes of early action on old age pensions were dashed with the issue being sidelined by the creation of a Parliamentary committee to report on the issue.11 His experience in not securing much favoured policies was to be shared later by the more radical Liberal Democrats in the 2010 coalition. Early on in his dealings with the Liberal Unionists, Salisbury had remarked that ‘the path of a man who attempts coalition is beset with pitfalls’.12 This was true not only of coalitions leading to mergers but especially so where the most partisan of both extremities of coalitions pressed for an end to coalition compromises. Vernon Bogdanor has written of the ‘centrifugal pressures’ which were pushing the 2010 Conservative-Liberal Democrat coalition apart, observing that ‘a coalition is peculiarly susceptible to pressures from below’. This, as he noted, was especially so in the case of the break-up of the Lloyd George Coalition in 1922 and the withdrawal of the main (Samuelite) Liberals from the National Government in 1932.13 Disraeli had said in 1852, at the end of his speech defending the first Derby minority Conservative government on the verge of its defeat, ‘But coalitions, although successful have always found this, that their triumph has been brief. This, too, I know, that England does not love coalitions.’14 While Disraeli was acutely aware that he would be among the first of leading politicians to be excluded from a coalition, nevertheless he was right. Coalitions have lacked popular appeal, at least after initial goodwill.

11

12 13 14

Peter Marsh, The Discipline of Popular Government: Lord Salisbury’s Statecraft, 1881–1902 (Hassocks, Harvester Press, 1978), 265–9. Michael Bentley Lord Salisbury’s World (Cambridge: Cambridge University Press, 2001), 289–92. David G. Hanes, The First British Workmen’s Compensation Act, 1897 (Newhaven and London: Yale University Press, 1968), 101. Salisbury to W. H. Smith, 23 January 1887; quoted in Bentley, Lord Salisbury’s World, 292. Vernon Bogdanor, ‘Tories and Lib Dems – beware the grassroots’, Guardian, 14 May 2012, 26. 16 December 1852, House of Commons Debates; quoted in W. F. Monypenny and G. E. Buckle, The Life of Benjamin Disraeli: Earl of Beaconsfield, Volume 3 (John Murray, 1914), 447.

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David Lloyd George’s fall in October 1922 was surprising in that he had lasted so long after his landslide victory in the 1918 general election in the face of increasing dissent from the dominant coalition partner, the Conservative and Unionist Party. Lloyd George had won too well in the 1918 election, in that the coalition partners were not left dependent on each other. The Coalition forces won 473 seats and 47.1 per cent of the vote against 234 (with the Sinn Fein 73 not taking their seats) and 52.9 per cent of the vote. Within this, however, there were 332 Coalition Conservatives and 50 other Conservatives in a House of 634 MPs (excluding the 73 Sinn Fein), so giving them a clear majority on their own, regardless of Sinn Fein. In addition to this, the post-war coalition government faced coalition fatigue, being the third coalition since 1915, the others being the Asquith coalition (May 1915–December 1916) and the Lloyd George wartime coalition (December 1916–January 1919). Before the Asquith coalition government, there also had been something like an unofficial coalition in that the Conservative and Unionist leaders had co-operated with the government under the party truce agreed on 28 August 1914. In the case of Balfour, this was very active co-operation, which included his return to the Committee of Imperial Defence (which he founded when Prime Minister) and which followed on from his role on one of its major subcommittees from 1912.15 The tacit coalition crumbled under backbench pressure and, as A. J. P. Taylor has observed, the main parties’ leaders quickly agreed a coalition ‘to thwart this pressure, not to satisfy it’. Hence, it was ‘a coalition . . . of the front benches against the back’.16 The Conservative and Unionist backbench opposition to Asquith’s wartime coalition was centred on the Unionist Business Committee, set up on 27 January 1915, and the Unionist War Committee, formed a year later in January 1916. The Unionist Business Committee, a body of MPs who were businessmen and active tariff reformers, started as an economic pressure group but soon began to press for the more efficient prosecution of the war. Its early concerns over the production of munitions were a major contributory reason for the supersession of the Liberal government.17 The Unionist War Committee, with Sir Edward 15 16

17

R. J. Q. Adams, Balfour: The Last Grandee (John Murray, 2007), 290–1. A. J. P. Taylor, ‘Politics in the First World War’ (The Raleigh Lecture, British Academy, 1959), reprinted in his Politics In Wartime (Hamish Hamilton,1964), 20. A. J. P. Taylor, English History 1914–1945 (Oxford: Clarendon Press, 1965), 32. W. A. S. Hewins, The Apologia of an Imperialist, Volume 2 (Constable, 1929), 8–47.

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Carson at its head, pressed strongly for the more effective prosecution of the war, successfully ensuring that Bonar Law represented its views.18 As John Turner has commented, both the Business Committee’s and the War Committee’s ‘support for the “vigorous prosecution of the war” was more consistent than their support for the Party leader’.19 By the middle of 1916, the Conservative and Unionist backbenchers as a whole were ignoring Bonar Law’s expressed wish that they ‘should stop all criticism’.20 The run of three coalitions resulted in some ambitious politicians being repeatedly disappointed over posts, especially when the allocation of these was skewed in favour of the minority partner. However, in the case of the Asquith coalition where the main parties were roughly equal in size, the Liberals held the posts of Prime Minister, Foreign Secretary, Chancellor of the Exchequer and, on Kitchener’s death, Secretary of State for War, while Bonar Law, the Conservative and Unionist leader, was given only the relatively junior post of Colonial Secretary. With Lloyd George’s wartime coalition government, the Conservative and Unionists took 12 senior posts (War Cabinet and normally of Cabinet rank) to the Liberals’ 8, in contrast to 13 held by Liberals and 9 by Unionists under Asquith. Yet Lloyd George’s Liberal support amounted to a relatively small number of MPs, which fluctuated between 49 and 71 and had at its core the Liberal War Committee with Sir Frederick Cawley, cotton merchant and MP for Prestwich, as its most prominent member.21 Eager, active backbenchers such as W. A. S. Hewins, a leading tariff reformer and a senior member of the Unionist Business Committee, believed that they were being passed over because of the coalitions; in Hewins case, though, it was deemed to be ‘owing to the retention of certain Unionist “deadheads” ’22 Later, writing at the end of World War II, Lord Croft, Under-Secretary of State for War under Churchill, 1940–45 and formerly Henry Page Croft MP, complained that most political memoirs were by nonConservative politicians. This is largely due to the formation of Coalitions and the consequent and almost inevitable compromise in political opinion in the last quarter of a century.

18 19

20 21 22

John Ramsden, The Age of Balfour and Baldwin 1902–1940 (Longman, 1978), 114. John Turner, British Politics and the Great War: Coalition and Conflict 1915–1918 (New Haven and London: Yale University Press, 1992), 104. Hewins diary, 5 June 1915, printed in Hewins, Apologia, Volume 2, 37. Cameron Hazlehurst, Politicians At War: July 1914 to May 1915 (Jonathan Cape, 1971), 292. Hewins, Apologia, Volume 2, 102.

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Conservatives have had a raw deal over this period, and since the supreme test of leadership appeared to be the detachment of Liberal and Socialist elements from the opposite camp, and still more to play up to the great mass of middle class thought which had no political opinion at all, half of the nation which originally put Conservative leaders in the saddle has been ignored and never even had anything like its fair share in the government of the country.23

However, the second wartime coalition under Lloyd George went a long way in meeting the views of both the Unionist War Committee, with Carson in and out of senior office, and the Liberal War Committee, with Cawley rewarded with the Duchy of Lancaster. Right-wing Conservative MP William Joynson-Hicks later compared the post-war Coalition unfavourably with its predecessor, observing ‘The Coalition did well during the war, when it had both principle and policy.’24 The wartime coalitions under fresh leaders did relatively well. At first, Lloyd George, in  1916–18, seemed precarious as a Liberal head of Conservativedominated coalition for at least his first year, though recollection of this became hazy with victory in 1918. Churchill in 1940–45 had his critics, with occasional serious rumbles of discontent, but the Labour leadership was more reliably loyal to him than some leading Conservatives were to Lloyd George when they felt he was insufficiently supportive of the generals. However, in World War I, some ultra ‘patriots’ on the Conservative Right broke away to form the National Party in August 1917. Henry Page Croft, the driving force behind the National Party, recalled, ‘The Coalition was . . . in power and as Conservatives we found the whole outlook of the Government repugnant in many directions.’ However, his expected force of 21 MPs dwindled to 8 by the time the National Party was launched.25 With the 1918 general election it fell to 2 MPs, but it did relatively well in  10 seats where there was neither a Coalition Conservative nor a Conservative standing, polling 34.2 per cent of the vote, in contrast to 16 seats where it faced Conservative opposition, and polled only 13.5 per cent.26 Hence, the National Party’s appeal was to those on the Right who wished to vote against the Coalition-sponsored non-Conservative candidates. Its remnants later were part of the Die-Hard revolt against the Lloyd 23 24 25

26

‘Preface to Political Events’, Lord Croft, My Life of Strife (Hutchinson, 1948), xi. Letter to The Times, 8 June 1921, 6. Croft, My Life of Strife, 130. Chris Wrigley, ‘ “In the Excess of Their Patriotism”: The National Party and Threats of Subversion’, in Chris Wrigley (ed.), Warfare, Diplomacy and Politics: Essays in Honour of A. J. P. Taylor (Hamish Hamilton, 1986), 93–119. Jason Reece, ‘Henry Page Croft (1st Baron Croft) 1881–1947, the Empire and the Conservative Party’. University of Nottingham M. Phil thesis, 1991, 93–4.

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George Coalition government after 1920. Similarly, in World War II, there were revolts on the Left, with voters rewarding Left candidates most notably those of Common Wealth, formed in 1942, when given no choice on the Left because of the wartime truce between coalition partners.27 The title ‘National Party’ appealed in wartime to all manner of groups seeking to assert their patriotic role and, in some cases, to appeal to a centre political constituency. In some respects, this echoed Lloyd George’s secret coalition endeavours in the midst of the constitutional crisis of 1910. Indeed, in  1917 it was rumoured that Lloyd George was considering adopting this name. The businessman F. S. Oliver, who had just stepped down as a Tariff Reform League committee member and was to be an éminence grise of Page Croft’s National Party, listed Winston Churchill, F. E. Smith, Neil Primrose (former Lloyd George Liberal Chief Whip), Freddie Guest (successor to Primrose from May 1917) and Beaverbrook as the others prominent in contemplating such a move. However, he suggested there were also a further four groups toying with this designation, with the key figures in each group being Walter Long, Reginald McKenna and the Liberal Whip John Gulland (‘Squiff being more or less a stalking horse’), the industrialist Dudley Docker and Tommy Bowles, founder and editor of Vanity Fair (1868–89), former Conservative MP for King’s Lynn (1892–1906) and Liberal MP there (between the elections of 1910).28 Not surprisingly, in both wars such political revolts against the coalition governments were strongest when the war was going badly. Lord Blake, when reflecting on the coalitions of 1783–1902, observed that they usually weakened with the ‘apparent disappearance of the emergency’ that brought them into being. Hence, he believed ‘coalitions can have a solid basis in war, for the emergency is there till the war ends’.29

The growing challenge of Labour Outside of war and economic crisis coalition leaders needed a political threat against which to unite. From 1886, Gladstone and Irish Home Rule served 27 28

29

Paul Addison, The Road To 1945 (Jonathan Cape, 1975), 159–60 and 249–50. F. S. Oliver to Selborne, 5 September 1917. Selborne Papers, 87/16–18. Bodleian Library, Oxford. ‘Squiff ’ was a widely used nickname for Asquith. Bowles later supported Lloyd George’s coalition, admiring his ‘energy and courage’. Letter, The Times 14 October 1921, On Docker, see R. P. T. Davenport-Hines, Dudley Docker (Cambridge University Press, 1984). Robert Blake, ‘1783–1902’ in Butler, Coalitions in British Politics, 24.

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the purpose. At the end of World War I, Bolshevik Russia served very well, reinforcing much rhetoric of anti-socialism from the early years of the century and before. Winston Churchill, an outstanding anti-Bolshevik, had mixed up anarchists and German socialists as his bogeymen in his novel Savrola as early as 1900. In 1917–20, labour unrest in Britain, most of Europe and other parts of the world added to fears aroused by events in Russia. Lloyd George ably played on such fears to reinforce the beliefs of many Conservative leaders that he was essential if Britain was to weather the post-war social unrest. Indeed, Bonar Law, in urging Conservative support for the coalition, warned that if Lloyd George was not kept in the coalition, ‘he would probably go with the extreme socialists and be very dangerous’.30 While this was improbable but a good threat to make doubtful Conservatives fall in line, there were real fears in  1919 and 1920 of red disorder. Milner, often a hero of the Conservative Right, even warned Lloyd George shortly after the Armistice, ‘With the state of Europe and the revolutionary tendency, greater or less, in all countries, it is as dangerous to have no army as to have too big a one’.31 Bonar Law and Milner, along with Arthur Steel-Maitland, were major figures in seeking a broad antirevolutionary and anti-socialist front before the 1918 election. There was strong support for an electoral deal with the ‘patriotic section of the Labour Party’, which was perceived to be an antidote to the Independent Labour Party.32 In such circumstances clinging on to Lloyd George was preferable to going it alone. As St Loe Strachey put it to Sir Edward Carson, ‘As you know I distrust L.G. probably more than you do, but at the same time I am terribly afraid of anything like splitting the forces opposed to revolution whether in Ireland or here.’33 With the Labour gains in urban areas of 1919–20, some Conservatives saw benefits from some co-operation with Lloyd George’s Liberals. There was awareness that the Liberals were more able to hold mining and some other

30

31

32

33

Lord Derby’s diary entry,16 October 1918; quoted in Chris Wrigley, Lloyd George and the Challenge of Labour: The Post-War Coalition 1918–1922 (Brighton, Harvester-Wheatsheaf, 1990), 17. This book examines the labour unrest and misplaced fears of the revolution of these years. Milner to Lloyd George, 13 November 1918; quoted in Wrigley, Lloyd George and the Challenge, 24. Memorandum on Patriotic Labour, 10 March 1917. Memorandum,15 November 1917 dinner at St Stephen’s Club involving Steel-Maitland and 26 sympathizers, 9 November 1917. Steel-Maitland to Bonar Law, 16 November 1917. Steel-Maitland Papers, GD 193/99/2/11–17, 104 and 2/147. Scottish Record Office. Page Croft to F. S. Oliver, 28 August 1917. F. S. Oliver Papers, 7726/98/93. National Library of Scotland. More generally, see J. O. Stubbs, ‘Lord Milner and Patriotic Labour 1914–18’, English Historical Review, 87, 4, 1972, 717–54. St Loe Strachey to Carson, 13 October 1920. Carson Papers, D/1507/1, 1920/41. Northern Ireland Public Record Office.

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industrial seats against Labour. For example, Sir George Davies, chairman of the Bristol Unionist Association, wrote to Bonar Law: I am really most anxious about the political situation in Bristol (and probably our difficulties there are similar to those in other large centres). My opinion, after very careful consideration, is that if the Unionist Party and the Liberal Party each put forward candidates in each Division, that Labour would return their man in at least four Divisions – and quite possibly in all five; and after sounding leading Liberals who worked with us at the last Election, I find that they hold the same opinion. And yet they hold that unless some working arrangement is come to between Mr Bonar Law, Mr Lloyd George and Mr Asquith, the local party pressure will be too strong to allow them to continue the arrangement not to oppose us in West and Central if we did not oppose them in South and North Bristol.34

In the 1922 general election, the Conservatives won Bristol West in a straight fight with an Asquithian Liberal and Central with a majority of 3265 over just a Labour opponent. The former Coalition Liberals won North, South and East in straight fights with Labour, but by only 151 votes in the East (a seat Labour won in  1923 and was to hold in  1931). Also, as Michael Kinnear has noted, Conservatives who captured Liberal seats in 1918 were among the Conservatives happiest to support the Coalition, as they feared a Liberal resurgence would lead to the loss of their seats.35 Such positive feelings towards the Coalition Liberals were balanced by Conservative Central Office feelings of irritation with, even contempt for, the often-feeble Coalition Liberal local organization. For instance, Sir George Younger complained to Bonar Law at the time of the Spen Valley by-election, December 1919: We have the usual experience in this case, the Liberal organisation not being worth a rap and not being in any kind of way ready to make voluntary sacrifices in the way of work. Although this is not our seat, I have had to authorize a considerable sum to be expended in importing our own Agents and workers to the Constituency, and it seems always to be our fate to be drawn upon in this way.36

34 35 36

Davies letter, 8 February 1920, forwarded to Bonar Law the next day. Bonar Law Papers, 98/7/4. Michael Kinnear, The Fall of Lloyd George: The Political Crisis of 1922 (Macmillan, 1973), 90. Younger to Bonar Law, 12 December 1919. Bonar Law Papers, 98/5/11. House of Lords Record Office. For Conservative relations with the Liberal Coalitionists, see David Cuthbert, ‘Lloyd George and the Conservative Central Office, 1918–22’, in A. J. P. Taylor (ed.), Lloyd George: Twelve Essays (Hamish Hamilton, 1971), 167–87.

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Lloyd George was adept at playing up to anti-socialist fears. Interviewed by Harold Spender for the first issue of the Lloyd George Liberal Magazine: A Monthly Record of Practical Politics, Lloyd George commented: The Labour policy is not merely Nationalisation of Mines and Railways, but it amounts to the nationalisation of the whole processes of society. But the Independent Liberal Party are quite as rootedly opposed to that policy as we are – perhaps more so, if one may judge from their utterances. . . . Apart from the personal issue they have absolutely nothing to put forward as a substitute for coalition except hatred of this Coalition.37

Lloyd George also made much of the reforms brought in after the war by his government. In words similar to his successor Nick Clegg’s post-2010 claim to be delivering ‘muscular liberalism’ to a coalition that otherwise would veer further to the right, Lloyd George argued in the interview with Spender that the Coalition had facilitated the passage of reforms.38 ‘Do you really imagine’, he asked, ‘that we could have passed as many effective measures as we have passed by Coalition methods?’ He emphasized that the Coalition aimed its appeal at ‘the moderate men and women’ and that his government ‘shall refuse to follow either the Morning Post or the Daily Herald’.39 Kenneth O. Morgan, in his major study of the Post-War Coalition some 60 years later, was also enthusiastic about its reforms, commenting that ‘the 1919 and 1920 sessions were marked by a spate of social legislation without parallel since the heady days of the 1911 National Insurance Act. The Coalition became the vehicle for the New Liberalism redivivus’. However, as Morgan fully recognized, the 1921–22 recession ensured that the dominant Conservative part of the government was able to unravel much that had been accomplished in 1918–20, and in so doing undermined at least part of the Liberal Coalitionists’ claims of making a difference.40

37

38

39 40

‘Special Interview with the Prime Minister’, The Lloyd George Liberal Magazine, Vol. 1, 1, October 1920, 9. For Harold Spender on Lloyd George as ‘a national leader of this great victorious British folk, now slowly groping its way out of the shadow of death into the way of peace’, see his The Prime Minister (Hodder and Stoughton, 1920), 338. See Clegg’s comments in early 2011 regarding the Regional Growth Fund and Green Investment Bank http://www.bbc.co.uk/news/uk-politics-13350469 The Lloyd George Liberal Magazine,Vol. 1, 1, 8 and 12. Kenneth O. Morgan, Consensus and Disunity: The Lloyd George Coalition Government 1918–1922 (Oxford: Clarendon Press, 1979), 84.

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The prospect of fusion Indeed, even in  1920, the ‘red menace’ was not quite as effective a means of rallying support to the Coalition as it had been. Labour gains in the 1919 municipal election following on from the dismal Asquithian Liberal general election results encouraged polarization between Conservatives and Labour at the expense of either group of Liberals. One early example of reports suggested this was from a Conservative activist in Washwood Heath, Birmingham. She wrote to Arthur Steel-Maitland in late 1919: There is growing feeling among the Liberals in our district that they would be glad to unite with the Unionists for election purposes at least . . . . they realise that they can do nothing by themselves and yet still they form a good section of the people. . . . There is no question but that they are afraid of ‘Labour’ and in my opinion there is no question but that of old time association that prevents many of them coming right over to our party.41

Lloyd George was very alert to the need to change party politics in order for his Liberal Coalitionists to survive. While the Conservative leadership remained fearful of socialism, they were receptive to talk of fusion between the Coalition partners. However, he found that many of his Coalition colleagues in office were hostile. Coalition Liberals showed that they were real Liberals in their fervent defence of free trade, most notably in seeing off the 1919 Imports and Exports Regulation Bill and in attempting to reject what became the Safeguarding of Industries Act, 1921. They also brandished their Liberal credentials when it came to Lloyd George’s talk of dumping ‘Liberal labels’. Lloyd George’s hopes of a major political realignment ended with a meeting of Coalition Liberals on 18 March 1920.42 Left with the Coalition status quo, Liberals generally were faced with a steady draining away of support. The day after the Coalition Liberal meeting, W. Webster, the Secretary of the Scottish Liberal Federation, congratulated Arthur Murray on having raised ‘pertinent questions’ concerning the likely loss

41 42

Miss Annie Herrick to Steel-Maitland, 24 November 1919. Steel-Maitland Papers, GD 193/87/1. Kenneth O. Morgan, ‘Lloyd George’s Stage Army: The Coalition Liberals, 1918–22’ in A. J. P. Taylor, Lloyd George: Twelve Essays (Hamish Hamilton, 1971), 244–7. Morgan, Consensus and Disunity, 174–91.

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to the Labour Party of many Liberals if there was ‘fusion or even co-operation’ with the Conservatives. He observed that the feeling among Liberals of all kinds is that we are drifting further apart and that now it is only a question of time before division comes. In Scotland here we have done our best and have succeeded in holding ourselves together, and I believe we are still almost united, and this has been done in the hope that our representatives and leaders would do the same. They have evidently failed, and now we must take our courage in our hands and make our stand one way or the other.

He further commented: If the camp is divided into the ‘haves’ and ‘have nots’ (which it really amounts to), then tens of thousands of the best type of Liberal will go with the ‘have nots’. Of that there is no doubt. The young men of the country have troubled us all, but it is not altogether true to say that they are not with the Independent Liberals. So far as the Industrial Classes are concerned the majority of the young men are going Labour, but in these last few months there has been a rather remarkable revival towards Independent Liberalism, and one striking feature to me has been that the middle classes and the upper middle classes are now sending a pretty strong contingent into the ranks of the Independent Liberals.43

Lloyd George’s attempts to lead his Liberal followers to fusion failed, leaving the Coalition Liberals in a cul-de-sac. A week after the Coalition Liberal meeting, the Asquithian Liberals began warfare against Coalition Liberals. In Scotland, as Iain Hutchison has commented, this internecine strife was ‘exceptionally bitter’.44 In the 1922 general election, there were 11 Asquithian Liberals, 8 Lloyd George Liberals and 8 other Liberals returned for Scotland. For England, there were 29 Asquithian Liberals (none for Wales), 30 Lloyd George Liberals plus a further 6 in Wales and 3 for university seats with 17 other Liberals for England and 3 for Wales. So after coalition the Liberals emerged split three ways (Lloyd George 47, Asquith 40 and others 28) and were but a shadow of the party which had entered into the first of three coalition governments in May 1915.

43

44

W. Webster to Arthur Murray, 19 March 1920. Elibank Papers 8808, ff. 67–9. National Library of Scotland. Arthur Murray had begun as a Liberal Coalitionist but had become disillusioned and moved to the Independent Liberals. He later commented that ‘my support was conditional on the Government’s framing and interpreting legislation in a Liberal spirit’. Arthur Murray, Master And Brother: Murrays of Elibank (John Murray, 1945), 186. Trevor Wilson, The Downfall of the Liberal Party 1914–1935 (Collins, 1966), 198–200. I. G. C. Hutchison, Scottish Politics in the Twentieth Century (Palgrave, 2001), 35.

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Seeking to maintain a distinct identity The Coalition Liberal backbenchers and party members continued to insist throughout Lloyd George’s Post-War Coalition Government that they were holders of core Liberal values. In addition to shared core Liberal values, their specific Coalition Liberal outlook on current politics was well summed up by the subtitle of their journal: ‘A Monthly Record of Practical Politics’. Some Coalition Liberals were sufficiently strong on Liberal principles to rebel against the Coalition Government, just as did many Coalition Conservatives. Sir William Barton, MP for Oldham, stated in March 1921: Neither we nor the Conservatives of the Coalition believe that Liberalism and Conservatism can permanently stand for the same thing . . . The Conservative Party is quite rightfully maintaining its organisation in full force, and its conditions for the acceptance of outsiders into its field are that they shall accept its principles and forward its policies. In these circumstances Liberalism must stand as a free and independent force.

Less than a month later, Barton resigned the Coalition Liberal whip. Similar concerns were expressed at the same time by Henry Fildes, MP for Stockport. He declared that he was prepared to vote against the Government if these unauthorized and undisciplined reprisals in Ireland go on unchecked, and he also said that he was prepared to resign if ‘such reprisals were announced to be the settled policy of the Government’.45 If there was not to be fusion, then, in the face of demands for a return to ordinary party politics, Lloyd George and his supporters tried to give credibility to the notion that the future belonged to coalitions. Lloyd George, on being re-elected President of the Welsh National Liberal Federation on 8 October 1920, observed, ‘since 1886 we have had government by coalition in this country.’ He went on to say, ‘In 1915 Mr Asquith formed a Governmental Coalition of the two leading parties in the State . . . If Coalition is a sin against Liberalism Mr Asquith is a Jehoshaphat.’ He also commented, ‘every belligerent country, with the exception of America, has been driven to a Coalition to save the State. It is a world movement.’46 This view was reinforced by the Rev Dr J. C. Carlile, VicePresident of the Baptist Union, who wrote in the Coalition Liberal journal: 45 46

The Times, 14 March 1921, 7, and 5 April 1921, 10. ‘The Prime Minister on Government by Coalition’, The Lloyd George Liberal Magazine, Volume 1, 2, November 1920, 74–5.

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There are many signs that the old party system has passed, and in its place Government by groups has come in this country. It is not a question whether there shall be a Liberal, Unionist or Coalition Government. The only practical question is what kind of Coalition Government we are going to have.47

Such attitudes provided an opportunity for Coalition speakers to deride the prospect of an Asquithian Liberal-Labour coalition. One writer observed that ‘since we can no more see Mr Asquith leading the Council of Action than we can imagine Mr Bob Williams joining Sir Donald Maclean in opposition to Nationalization,’ the uniting of the two forces ‘seems likely to prove illusory’. Lloyd George devoted much of a speech to denouncing ‘the new Coalition’: ‘A sheep might as well turn on a tiger and ask him not to devour it because of the fact that it had admired his beautiful stripes, and by helping him to kill the rhinoceros in the jungle.’48 Lloyd George pointed out to Liberal Coalition critics who felt that he was in the pockets of the Conservatives, that Conservative backbenchers felt that their leaders were in the pocket of that ‘Radical Lloyd George’. However, Conservative backbench concerns grew as time went by. It was the increasing number of dissident Conservative MPs and activists which undermined and finally destroyed the Lloyd George Post-War Coalition.49 The threats which had cemented the Coalition in  1918–20 weakened. By 1921, with trade union membership tumbling and Bolshevik rule reduced to Russia, the ‘red menace’ was much reduced. The severe 1921–22 economic recession, which undercut organized labour, also caused the cut back of much of the Liberal Coalitionists’ social legislation by the ‘Geddes Axe’. Orthodox finance and the priority of paying off war debts ruled much of domestic policy to the chagrin of Liberal Coalition ministers such as Christopher Addison and H. A. L. Fisher. Diehards, whose views were often put strongly by Page Croft, had not seen the need for a Conservative-Liberal front to resist the Labour Party’s electoral advances. The National Party’s leaders’ response to the challenge of Labour after the war was not to cling to Lloyd George but to argue that Labour’s gains were due to the Coalition’s lack of principles. Page Croft declared in early 1920: 47 48

49

‘The Spirit of Solidarity’, The Lloyd George Liberal Magazine, Volume 1, 4, January 1921, 229. The Lloyd George Liberal Magazine, Volume 1, 2, November 1920, 66. ‘Lloyd George on The Coalition: The Menace of the Labour Party’; Ibid., 7 April 1921, 427–30. For an excellent assessment of the Conservative Party in coalitions 1915–22, see John Ramsden, The Age of Balfour and Baldwin 1902–1940 (Longman, 1978), Chapters 7 and 8.

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The Coalition is an endeavour to mix oil and water, and so long as it attempts to propound policies based on opposing principles so long will it decline in favour with the electorate. The voters appear to be ready to support any party with fixed ideas rather than a Government which trims its sails to threats of sedition and which exists upon ‘stunts’ rather than any fixed faith.

He elaborated his argument with reference to the December 1919 by-elections in Bromley and Hertfordshire, St. Albans. In Bromley, the Labour candidate had polled 47.5 per cent of the vote, to the Coalition Conservative’s 52.5 per cent, whereas a year earlier, the Conservative Coalition candidate had polled 79.5 per cent of the vote against a Liberal and there had been no Labour candidate. In Hertfordshire, St. Albans, there had been a three-way contest with the Coalition Conservative polling 45.8 per cent of the vote to the Labour candidate’s 42.4 per cent in contrast to a year earlier when the Coalition Conservative had been returned unopposed. Page Croft commented that we have the extraordinary situation . . . where enormous Labour votes were polled, although there is practically no organised Labour movement. The reason is that the Labour representatives are out for something definite, whilst the Coalition is running no one knows whither and is invariably on the defensive.50

For many Diehards, Lloyd George was not the answer to the threat of Labour but part of the problem. For The National Review in June 1922, Lloyd George was ‘the British Lenin’ and a North Dorset Diehard declared that ‘Lloyd George was actually shaking hands and dining with the very man who entered the cellar in Russia and shot the Czar and Czarevitch with his own hands’.51 Such views were not isolated, but remained those of a Conservative minority. There were more than enough widely held criticisms of continued coalition for the government to be steadily undermined.

The beginning of the end Lloyd George was adroit to maintain the Coalition Government beyond spring 1921. In southern England, where the threat of Labour was mostly minimal, disenchanted Conservative voters supported Anti-Waste candidates, who won a 50 51

Letter to The Times, 12 January 1920, 8. Kinnear, Fall of Lloyd George, 80–1. For a fictional treatment of the Bolshevik who killed the Tsar but by bayonet, see ‘Sapper’, The Black Gang (1922).

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series of by-elections. At Dover, in January 1921, an Independent Conservative soon to be linked to Anti-Waste, Sir T. A. Polson, won with 56.3 per cent of the vote a seat which the Coalition Conservative had secured in 1918 with 68.7 per cent. Soon there was a steady trickle of Coalition Conservatives who jumped ship, usually making savage comments about Lloyd George as they went. In July, Colonel Claude Lawther, Coalition Conservative MP for Lonsdale, declared that ‘only an abnormal elasticity of mind or a dishonest stretch of the imagination could justify me in further supporting a Government which since the election has turned a complete somersault’. Within a fortnight, Martin Archer-Shee, MP for Finsbury, and Colonel John Gretton, MP for Burton, followed.52 One notable later departure was that of one of the Master of Elibank’s sons, Gideon Murray, MP for Glasgow St. Rollox. When announcing his departure, Murray stated: The Conservative Party stands for definite principles, and has long and honourable traditions behind it. The Coalition stands for none, but is fitfully and often hopelessly dashed about on rocks of opportunism, expediency and vacillation.53

Friction between the coalition partners occurred as might be expected over such old areas of conflict as Ireland, the Empire, tariffs and levels of state expenditure. Edwin Montagu’s Indian reforms and the condemnation of General Dyer for the massacre at Amritsar enraged the Conservative Right. Even more damaging to the coalition was the Irish settlement of 1921, with resentments simmering within the Conservative Party for much of 1922. There were several foreign policy developments of Lloyd George which enraged not only Diehards but also other Conservative backbenchers, ranging from alleged softness towards Germany to negotiations with Soviet Russia. Above all, Lloyd George espoused an interventionist foreign policy, more akin to Gladstone and the Bulgarian massacres of 1876 than the more isolationist outlook of the 14th Lord Derby in the mid-nineteenth century. Even those hostile to Turkey were dismayed by Lloyd George’s policies leading to the Chanak crisis. As Lord Curzon put it to Phillip Kerr, Lloyd George’s foreign policy adviser, ‘I believe we shall be at war in Asia Minor in a few weeks’ or months’ time almost entirely because of our Smyrna decision. My views are assuredly not prejudiced (because I am strongly

52 53

The Times, 4 July 1921, 17, and 21 July 1921, 10. The Times, 3 February 1922, 12.

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anti-Turk). My [views] are based on my knowledge of the Turks (and the Greeks) and on the confident prophecies of nearly everyone who knows the East.’54 In spite of substantial anti-Coalition feeling in the Conservative Party, most of the Conservative leadership remained loyal to the Coalition Government until its collapse with the Carlton Club meeting in October 1922. As a result, right-wing critics of the coalition vented their wrath on Austen Chamberlain, Conservative and Unionist leader, after the retirement of Andrew Bonar Law on account of ill health in March 1921. Lord Carson, addressing the East Kent and Canterbury Conservatives in January 1922, complained after the Irish settlement: He had no leader; they had been swallowed up. He had no party. He was a Unionist born and bred, but what had become of Unionism? It had been strangled by its owners . . . . I can hear Mr Chamberlain saying, ‘’Go to the country – for what? To ask the country to support men who have just abandoned every principle they have been preaching for the whole of their lives. We must wait until it is forgotten, and then we will go to the country.’’ ’55

In March 1922, The Times commented, ‘The Coalition is dying before our eyes’. It added that the Conservative rank and file was making it very clear that it ‘attached greater importance to the unity of the party than to the continuance of the Coalition’.56 Yet, it is notable that most Conservative Associations still backed their national leadership, as did Bonar Law even after Lloyd George’s lack of success at the Genoa Conference, April–May 1922. A notable example of such local support was displayed at the AGM in late May of the association of the ultra-safe Conservative seat of the City of London, which in the general elections usually returned two Conservatives unopposed. At it the leading Diehard MP Sir Frederick Banbury denounced the Liberal Coalition minister Edwin Montagu over his moderate attitude to Gandhi, and asked the rhetorical question, ‘Mr Gandhi has been responsible for the loss of about 10,000 lives, and he was not to be punished?’ Banbury added, ‘At the next election Conservatives would have to stand as Conservatives. That meant that they would keep their independence and support only Conservative measures.’ After a discussion in which pro- and anti-Coalition views were expressed, the chairman said, ‘This Association is a

54

55 56

Curzon to Philip Kerr, 12 March 1920. Lothian Papers, GD40/17/208, ff. 268–9. Scottish Record Office. The Times, 14 January 1922, 12. The Times, 16 March 1922, 13.

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Conservative Association and it supports recognized leaders of the Unionist Party and no one else. The recognized leaders of the Unionist Party in their wisdom support the Coalition, and therefore we support it also. But we are a Unionist body (Cheers).’57 However, the Coalition fell 5 months later when backbenchers, finding a credible alternative leader in Bonar Law, indicated very clearly that it no longer had adequate Conservative support.

Reluctant Liberal withdrawal, 1932 There was not as much pressure from below in  1932 as Bogdanor suggests, although there was acute awareness on the part of the Samuelite ministers in office of their party’s concern which did reinforce their eventual decision to resign from Ramsay Macdonald’s National Government in 1932. Samuel had been Home Secretary, Sir Archibald Sinclair at the Scottish Office, Sir Donald Maclean at Education in the initial National Government before the 1931 general election and had stayed put in the government’s reconstitution that November while Lord Lothian moved from being Chancellor of the Duchy of Lancaster to Under Secretary of State for India. Before the economic crisis, Samuel had moved away from the economic policies behind the Liberals’ 1929 general election programme, We Can Conquer Unemployment and by 1930 had adopted orthodox Treasury views. Samuel’s biographer, Bernard Wasserstein, has observed of a Cabinet memorandum of 14 September 1931 in which he denied that the Liberal members of the government were necessarily hostile to tariffs that a ‘hostile reader of the Cabinet memorandum (and eight of the nine ministerial readers would be hostile) might be forgiven for interpreting his professed open mindedness on the subject of tariffs as indicating a readiness to abandon even the most cherished Liberal principle in order to avoid facing the electorate’.58 After the election, Samuel and his ministerial colleagues moved snail-like towards resignation in spite of free trade being abandoned in stages, the final straw being the agreements on imperial preference at the Imperial Economic Conference held in Ottawa, July–August 1932. In calling on his Liberal colleagues to act together in leaving the National Government, Samuel urged: 57 58

The Times, 29 May 1922, 18. Bernard Wasserstein, Herbert Samuel: A Political Life (Oxford: Clarendon Press, 1992), 325.

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The Liberal workers in the country see the dangers of a repetition of the experiences of forty years ago, and of the absorption of another generation of Liberal Unionists by the Conservative party. They will not suffer it in silence, and they will be right.59

Lloyd George was bitter in his criticism of Samuel’s dilatory departure from the embrace of the National Government, saying ‘he has no right to talk of Ottawa trickery and things of that kind . . . Free Trade was doomed from the moment the right hon. gentleman agreed to an election without sufficient guarantees’. He was especially critical of ‘the scrapping of all the great schemes of development upon which we fought the election of 1929’.60 After resigning in September 1932, Samuel and his followers stayed on the government side of the House of Commons for a further year before crossing to the Opposition benches. In this, at least for a while, there was sense, given the highly fissiparous state of the Liberals, such a move risking his group diminishing further in size. As with the resignation from office, the Liberal leaders were spurred on by many of the rank and file members. The Scottish Liberal Federation passed a motion calling on the Parliamentary Party to join the Opposition side of the House of Commons. Sinclair warned Samuel, ‘The longer we remain in our present position the more inglorious, embarrassing and insignificant it becomes.’61 So ended a period of near-informal coalition, when Samuel and his colleagues still supported the National Government, but the outright breach of Free Trade made it politically impossible for them to cling on to office. The coalitions since 1895, but especially from 1918, have been something of the political equivalent of the Wars of Spanish Succession or Dutch Succession. The question was who was to succeed to the former Liberal voters. In the 1920s, both Stanley Baldwin and Arthur Henderson explicitly made bids for support from these electors. In doing so, they emphasized their reliability and even plodding no-nonsense politics, a sharp contrast to the flashiness of Lloyd George and his closest former coalition colleagues (such as Churchill and F. E. Smith). Entering coalitions was notably risky for the smaller parties. They were often cannibalistic affairs, with the Conservative Party readily eating up its weaker 59 60

61

Memorandum by Samuel, 28 August 1932; quoted in Wasserstein, Samuel, 357. House of Commons Debates, 25 October 1932; quoted in Peter Rowland, Lloyd George (Barrie and Jenkins, 1975), 700. Sinclair to Samuel, 14 October 1933; quoted in Wasserstein, Samuel, 365. Gerald J. De Groot, Liberal Crusader: The Life of Sir Archibald Sinclair (Hurst, 1993), 102.

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partners. Few escaped the Conservative embrace, the most notable exception being David Lloyd George who, a year after his premiership ended, moved back to Radical politics and usually to a highly critical stance with regard to the Conservative Party. In contrast, Joseph Chamberlain, though eager to retain his Liberal Unionist power base, moved away from mainstream Radical politics towards imperial concerns and economic protection, even if still advocating some remedies for inner city issues. Nevertheless, to vary Disraeli’s dictum, the Conservative Party’s rank and file and many MPs have not liked coalitions. They have suffered them in the hope that they serve to thwart Labour, or Gladstone earlier, or as staging posts between Opposition and majority Conservative administrations. In 1922, it took a backbench rebellion to secure the desired result, the 1922 general election win and a very non-coalition Conservative government under Andrew Bonar Law. New Conservative backbenchers eager to be active in Parliament in April 1923 set up the 1922 Committee to assist their leaders ‘carry on the affairs of the Nation upon the sound basis of Conservative principles’.62 The Committee also aspired to safeguard Conservative principles from the wiles of Lloyd George or others like him in coalition government. Nevertheless, the Conservative Right found that coalitions with parties to the Left of the Conservatives resulted in the balance of power and policies moving away to the Left of them, leading to calls for purer Tory policies, as happened under David Cameron’s coalition government after 2010. Lord Carson expressed well disgruntled Conservative and Unionist unhappiness in  1922 when he was reported complaining, ‘A Coalition was impossible, because it could not be honest. It was a sort of political shandy gaff, a mixture of beer and ginger beer . . . he would rather see any Government in power, so long as it was sincere and true, than a Government, however clever, in which he did not believe.’63

62

63

Philip Goodhart with Ursula Branston, The 1922: The Story of the Conservative Backbenchers’ Committee (Macmillan, 1973), 15. The Times, 14 January 1922.

8

How to Put ‘the People First’: Conservative Conceptions of Reform Before and After the Second World War Richard Carr

The Conservative Party, in the modern era, has frequently presented itself as reforming in order to win office. This has not always been convincing – Conservative leaflets ahead of the 2010 General Election proclaimed people should ‘Vote for Change’ while making much play of a pledge to match Labour spending estimates for the NHS – but it has often worked: David Cameron going on to crawl over the winning line with Liberal Democrat support. At the same time, the party’s relationship with the state has at times been uneasy, with recent Conservative leaders of differing persuasions looking for ways to roll back its influence – Margaret Thatcher giving council tenants the ‘Right to Buy’ their homes, John Major continuing the privatization of British industry that Thatcher had started and David Cameron pledging to facilitate a ‘Big Society’ where voluntary and charity groups would take over public services from a supposedly inefficient and decrepit public sector. But the dilemma of how a conservative party could also be reforming predates such recent developments. It is instructive to look further back – to World War II and earlier – to consider what reform has meant to Conservatives, and from whom they have drawn their inspiration. Campaigning during a 1944 by-election, Quintin Hogg – later Lord Hailsham – confidently informed his audience that ‘I am one of those Conservatives who has always put the conditions of the people first.’1 This was arguable. Views on Hogg aside however (and there were many in a parliamentary career lasting from the Munich Agreement to the advent of New Labour), it was not exactly a ringing 1

By Election Speech, 23 February 1944, C[hurchill] A[rchives] C[entre], Hailsham Papers, HLSM 1/6/5/122.

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endorsement for his immediate contemporaries. For if Hogg indeed constituted one of the more caring figures within the Tory Party, this rather implied that there were those who did not share such altruism. His off-hand comment thereby revealed two trends within conservatism of the day. The first has been well docu­ mented. As Paul Addison among others has shown, Hogg indicated the wider shift of the Tory Party leftwards during the war.2 In part, of course, this was mere pragmatism. It seems likely that the Labour Party would have won any General Election after 1940 had the coalition split, and, in any case, Mass Observation reported that by December 1942 about 40 per cent of people had changed their political outlook since the conflict began – mostly to the left.3 Even if Hogg foresaw the problem, he and others would be swept away by such forces through the colossal Labour victory in 1945. His book The Left Was Never Right, designed to answer the anti-Tory charges of Cato’s Guilty Men, barely caused a ripple.4 These trends – the Conservative ideological shift and her eventually crushing defeat – obscure the second point that Hogg’s comment, however obliquely, suggested, and which forms the crux of this chapter. ‘One of those’ can be read as indicative of a broad thrust behind a single overarching desire – reform – or, alternatively, as Hogg being representative of a particular strand of this overarching reformist drive. For the purposes of this chapter, we will read it in the second sense, and thereby outline that there were two main interpretations of how progressive Conservatism should position itself in the post-conflict world (and indeed, two sets of actors). This is an important point, one crystallized by Harold Macmillan’s arguably misleading interpretation of Hogg’s failed party leadership bid in  1963 preventing the continuation of ‘what [Oliver] Stanley, John Loder, [Bob] Boothby, Noel Skelton and I had tried to represent from 1924 onwards’ – the liberal wing of the party made good in progressive policy.5 As we will see, such mutual appreciation distorts. In reality, those opposed to the older, seemingly more intransigent, Conservative leaders had rather less common conception of what conservatism should mean than might at first appear. It is these patterns, which came to light during World War II (and arguably replicated in David Cameron’s leadership after 2005), which will come into focus in this analysis. 2

3 4 5

P. Addison, The Road to 1945: British Politics and the Second World War (London, 1994), passim. Interestingly in this, the 1994 version, Addison indicated that notions of the post-war consensus might have to be adjusted in the light of Thatcher. Mass Observation, ‘Social Security and Parliament’, Political Quarterly, 14 (1943), 246. Q. Hogg, The Left Was Never Right (London, 1945); Cato, Guilty Men (London, 1940). Quoted in E. H. H. Green, Ideologies of Conservatism: Conservative Political Ideas in the Twentieth Century (Oxford, 2002), 191.

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Historians have, by and large, accepted the progressive Conservative story. Few dispute that the experience of wartime coalition saw an increased homogeneity between the two main parties – shifting both towards a consensus of reform within the existing system.6 Though the late 1940s did indeed see fierce battles between Labour and the Tories on the relaxation (or otherwise) of wartime controls and an austerity Britain – unlike 11 May 2010 – led by Labour, by the 1950s, the Macmillan era consumerism where the people ‘never had it so good’ was met by some on the Labour right (principally, Anthony Crosland’s Future of Socialism) with the acknowledgement that the left would have to build in this reality to their own offer to the electorate.7 Conservative historians such as Correlli Barnett have castigated such detente – and seek to criticize liberal Tories for acquiescing to the post-1945 welfare state at the expense of the capital investment that could have given Britain its own German style ‘economic miracle’ of the 1950s.8 While bipartisanship is generally viewed as a limited phenomenon overall, even those academics at pains to stress such limits acknowledge that there was no going back to 1939 for the Tory Party.9 In terms of post-1945 public discourse, this seems fair. Even Oliver Lytellton, advocate of laissez-faire in most parliamentary matters, was eager to stress previous Conservative involvement in the creation of the Beveridgean governmental structure: ‘The Socialists . . . are making a great song and dance about their responsibility for the creation of the Welfare State. They point to the National Health Service as being their child. In point of fact, everybody knows that it was fathered by Mr Churchill’s Coalition Government.’10 While this chapter debates whether Conservatives actually helped drive or merely acquiesced to this process, it seems hard to dispute the changing nature of what was politically acceptable. The message evolved. While acknowledging a greater penchant towards more interventionist forms of government within Conservative thought, this analysis is divided into two strands. The first will deal with those, slightly older, reformers who placed their faith most readily in the ideas of William Beveridge and John Maynard Keynes.   6   7

  8

  9

10

An exception is B. Pimlott, ‘Is Postwar Consensus a Myth?’, Contemporary Myth, 2 (1989), 12–15. As indicated below, the work of I. Zweiniger-Bargielowska is particularly perceptive on the austerity debates. C. Barnett, The Lost Victory: British Dreams, British Realities 1945–1950 (Basingstoke, 1995), passim. On the limits of bipartisanship, K. Jeffreys, ‘British Politics and Social Policy during the Second World War’, Historical Journal, 30 (1987), 123–44 and R. Lowe, ‘The Second World War, consensus and the foundation of the welfare state’, Twentieth Century British History, 1 (1990), 152–83. I. Zweiniger-Bargielowska, ‘Austerity and the Conservative Recovery After 1945’, Historical Journal, 37 (1994), 173–97 shows how, even if the party remained diametrically opposed to much of what Labour enacted, there was no going back. Undated Typescript, CAC, Chandos Papers, CHAN 4/17/08.

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Broadly speaking, such men had been pre-war opponents of the ‘safety first’ economics of Baldwin and had viewed the European totalitarian regimes (often successful) attempts to curb unemployment in a sympathetic, even positive, light. The interwar Conservative Party, it will be shown, was not all ‘hard faced men who had done well out of the war’, but contained many uncomfortable at such notions.11 We will then move onto a younger generation of MP – centred around figures such as Rab Butler and Viscount Hinchingbrooke – who, though amenable to reform of the governmental structure, did not believe the state should intervene as much as Keynes and Beveridge suggested. They imbibed the ideas of the Austrian émigré economist Friedrich von Hayek, and were plagued by the thought that even were Nazism defeated, Britain could lose the battle for its freedom on the home front to domestic bureaucrats and governmental red tape. The struggle between these opposing ideologies, albeit cloaked in the same rhetoric and waged by men of similar age and appearance, would be fierce indeed. September 1939, it will be shown, was not only a turning point for the history of Europe, but also marked an important shift in Conservative Party thought, and not always in the direction of a progressive, interventionist state. The ideas of Keynes and Hayek are necessarily outlined in broad-brush strokes here – countercyclical government intervention versus a reliance on market forces, pump priming with state expenditure against monetarism, demand versus supply – and the Tories outlined here could occasionally vacillate between the two. But, given the propensity of the politicians outlined here to mix with and praise the two economists, and their continued relevance to western political thought after the economic crash of 2007/8, it is worth considering how contemporary Conservatives were viewing them in another era of great national crisis.

The Keynesian background As has been well documented, the First World War changed the nature of government irreparably – even in seemingly stable Great Britain.12 A generation 11

12

Baldwin’s famous description of the 1918 parliament: P. Williamson and E. Baldwin (eds), Baldwin Papers: A Conservative Statesman, 1908–1947 (Cambridge, 2004), 40. One MP first elected in 1918 (and later sometime cabinet minister) Philip Lloyd-Greame described the parliament in more balanced terms as ‘men who had served in the war; but with that leaven an admixture of war profiteers’. P. Lloyd-Greame, I Remember (London, 1946), 15. See M. Cowling, The Impact of Labour 1920–1924: The Beginning of Modern British Politics (Cambridge, 1971), passim, and R. Lowe, ‘Government’, in S. Constantine, M. W. Kirby and M. B. Rose (eds), The First World War in British History (London, 1995), 29–50 for the evolving nature of both party politics and the state.

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of young men who had been marched off to war by the government now expected it to return the favour in ensuring their endeavours had been worthwhile. Those political movements, principally the Liberal Party, that did not – or could not – accept this change suffered permanent damage.13 A succession of acts – including Out of Work Donation and Unemployment Insurance – extended pre-war legislation beyond its rather ad-hoc limits and placed the burden of responsibility for people’s welfare firmly on the state.14 Though the ex-serviceman was the chosen symbolic cause of many, including Labour politicians such as Jimmy Thomas, by the early 1920s, six in ten people unemployed were former soldiers – a pattern given voice by the ‘shell-shocked’ literature in the 1920s, where Robert Graves and others poignantly highlighted the soldier’s struggle to adapt to a post-war world that hardly justified their exertions.15 This dual process – acceptability of interventionist government and increasing vocal displeasure with pre-1914 modes of thought – moved the goal posts for politicians and economists alike, with Garry Runciman even writing of the emergence of a new form of capitalism.16 The man who arguably most appreciated the changing set of circumstances was the Tory leader, Stanley Baldwin. Now Baldwin has had a rather bad press. A plethora of post-1945 authors derided his foreign policy in the 1930s as myopic, and most early biographers portrayed his domestic programme as lethargic in the face of industrial unrest and mass unemployment.17 Not a good start. Yet modern historians are increasingly inclined to highlight his steadying influence – calm in the face of the 1926 General Strike and to willingness to adopt a sympathetic discourse that, in a mass media age, created its own reformist consensus, albeit of a limited nature.18 There are indeed significant faults one 13

14 15

16

17

18

M. Bentley, The Liberal Mind 1914–1929 (Cambridge, 1977), passim and G. Dangerfield, The Strange Death of Liberal England (London, 1935), passim. W. R. Garside, British Unemployment 1919–1939: A study in public policy (Cambridge, 1990), 30–5. For Thomas and the former soldier, see Hansard Parliamentary Debates (Commons), 23 February 1921, vol. 138, col. 1094. Graves, Sassoon, Blunden and so forth are the more public examples, but see R. M. Bracco, Merchants of Hope: British Middlebrow Writers and the First World War, 1919–1939 (London, 1993), for less high-profile instances. Unemployment estimate in G. Wooton, The Official History of the British Legion (London, 1956), 43. W. G. Runciman, A Treatise on Social Theory, Volume Three: Applied Social Theory (Cambridge, 1997) and Idem, ‘Has British Capitalism Changed Since the First World War?’, British Journal of Sociology, 44 (1993), 53–67. On foreign policy, see Guilty Men and G. M. Young, Stanley Baldwin (London, 1952). Domestically, the following 1970s’ accounts can be taken as representative. D. Dilks, ‘Baldwin and Chamberlain’, in R. A. Butler (ed.), The Conservatives: A History from their Origins to 1965 (London, 1977), 271–404, 296–7, 309; H. Macmillan, The Past Masters: Politics and Politicians, 1906–1939 (London, 1975), 112, 154. His biggest modern advocate would be P. Williamson, Stanley Baldwin: Conservative Leadership and national values (Cambridge, 1999), passim. Even those historians dubbed Thatcherites recognize his achievements too: J. Charmley, A History of Conservative Politics, 1900–1996 (London, 1996), 94.

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can identify in Baldwin’s politics – his use of retrograde legislation (the 1927 Trade Disputes Act which made it illegal for civil service unions to join the Trade Union Congress) following the General Strike, his failure to elevate some of the promising young figures within his party (his 1924–29 administration was one of the most inert in modern memory), and his inability to adapt to the economic times after 1929 beyond bumbling eventually into imperial preference – yet words matter, and in this regard he was a master.19 It was through his rhetoric that Baldwin assuaged the Tory interventionists. David Marquand has noted that Conservative Keynesian social democrats ‘thought of themselves as Conservatives, belonged to a self-conscious Conservative tradition and appealed to the myths and symbols of that tradition’.20 This was certainly so, yet one should not ignore the decisive influence of the party leader in achieving this. Though Baldwin managed to blunt his more dynamic opponents in the short term – in the 1931 General Election putting pay to the various programmes of Arthur Henderson, David Lloyd George and Oswald Mosley – his success in nullifying Conservative radicalism is also worthy of acknowledgement. Aside from figures on the imperial right like Duncan Sandys, Oliver Locker-Lampson and George Lloyd staying within the party fold, Baldwin ensured that Harold Macmillan, John Loder and Oliver Stanley – who had been preaching government intervention since the 1920s – also remained (bar a temporary rupture with Macmillan in 1936) on the Tory benches.21 Baldwin’s success in retaining all these figures under his wing lay in his ability to wax lyrical about the First World War. Like Neville Chamberlain, Baldwin was too old to fight. Whereas his sometime Chancellor would later use the memory of the war to rally people to his promises of ‘peace for our time’, Baldwin used the strife of conflict to steady the domestic ship. Explaining his policy of ‘Safety First’ at the 1929 election, he remarked that ‘we don’t want the country crippled. It is only just convalescent after serious illnesses’.22 In part he referred to the General Strike, yet his previous rhetoric was indicative that he was invoking as much the Somme as the factories of Birmingham. Unveiling a war memorial in 1926, he declared that 19

20 21

22

Legislative exceptions to inertia included 1925 measures on Widows and Orphans pensions and Neville Chamberlain’s local government reforms. But by 1929, the Conservative ‘offer’ to the electorate was rather thin, they campaigned on their record, and lost. D. Marquand, The Unprincipled Society: New Demands and Old Politics (London, 1988), 18. See, for example, J. Charmley, Lord Lloyd and the Decline of the British Empire (London, 1987), 188 and G. Love, ‘The British Movement, Duncan Sandys, and the Politics of Constitutionalism in the 1930s’, Contemporary British History, (200), 23/4, 543–58. Blackpool Speech, 20 May 1929, Cambridge University Library, Baldwin Papers 200/67.

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There is one question that will hammer at all our hearts for many years to come . . . a question that the dead themselves might ask: “Have we died in vain?” and the question you hear asked by mothers and widows and orphan children all over the world. I have got to give an answer and you will have to give an answer. The answer we can give will depend upon what superstructure we can build upon the foundations that have been cemented in their blood.23

All this talk of ‘superstructures’, and concurrent use of wartime language such as ‘nothing can be done unless we can all pull together with a will’, was tailormade for the more Keynesian-leaning Tories.24 Baldwin was not their man, something Macmillan and others only fully accepted post facto, yet his language was well judged, appealing to a generation scarred by first-hand experience of the conflict.25 In essence, Baldwin helped retard something of a Keynesian revolution in Conservative thought. For the men and arguments which would resurface in the 1940s were already present in British politics almost from the moment the guns stopped on 11 November 1918. In Baldwin’s conception of the world, the encroachment of state apparatus during – and immediately after – the war was a dangerous trend. To those of Macmillan’s age bracket, it was but a precursor to doing more. The body of literature produced between the wars by Tories born in the 1880s and 1890s was suggestive of an interventionist mindset coming to the fore. Harold Macmillan’s lengthy correspondence with Keynes in the 1930s was by no means merely a response to the circumstances following the Wall Street Crash. If his Industry and the State, co-authored with Bob Boothby, Oliver Stanley and John Loder, was not yet the work of a man ready to jettison the Tory Party, it was certainly arguing in favour of a degree of government intervention – if initially expressed in terms of an industrial arbiter – that was alien to the Baldwinian world view.26 Old economic questions were cast aside as Oliver Stanley, for one, saw ‘the task of Conservatism to-day not to bring back the old world, which has gone forever, but on its lessons to build a new’.27 The world was changing, and not in directions Baldwin appreciated. In the 1930s, after all, there were signs of the networks of collaboration that would, seemingly, come to fruition during the war. Arthur Marwick’s now classic 23 24 25 26

27

S. Baldwin, Our Inheritance: Speeches and Addresses (London, 1928), 4–5 [3 June 1926]. Idem, On England (London, 1927), 30 [5 March 1925]. See Macmillan, Past Masters, 114. R. Boothby, H. Macmillan, J. de V. Loder, O. Stanley, Industry and the State: A Conservative View (London, 1927). O. Stanley in D. Crisp (ed.), The Rebirth of Conservatism (London, 1931), 201.

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article on middle opinion in the thirties pointed to a ‘very large groundwork of social and political agreement’ giving rise to the ‘ideological structure which took Britain safely through the forties and brought her to rest in the fifties’.28 In such a conception, those Tories within the Next Five Years Group could mingle, in a literal and intellectual sense, with Labour men like Aneurin Bevan and Herbert Morrison, with David Lloyd George offering a potential Rooseveltian leader at any stage.29 Such collaboration, it is claimed, was but a proto-coalition. Even if Daniel Ristchel and Helen McCarthy have offered more recent critiques, there is something in all this – for even Oswald Mosley had found respectable adherents for his New Party project in its early stages.30 MPs with experience of the Midlands and North during the depression – principally Macmillan in Stockton, but also Boothby in Aberdeen and J. S. Allen in Liverpool – were enraged at the lack of action in places The Times described as ‘without a future’.31 Hitler diverted attention to the diplomatic stage, but the Keynesians were active. By 1938 Macmillan was even arguing for a minimum wage. Importantly for later developments, let alone the contemporary ambiguities of appeasement, this dissatisfaction with Baldwinian politics produced an interest in the continental dictatorships. Hitler was a man of the First World War front generation who, quite apart from the aristocratic support he received in Britain, impressed the younger Tory politicians of the 1930s.32 Bob Boothby was ‘much impressed by his grasp of Keynesian economics’, while Anthony Eden recognized the generational similarity the two men shared – and their common experience of trench warfare.33 Mussolini too, the anti-appeaser Edward Spears noted, had ‘rendered the world a great service when he rescued his country from anarchy . . . His chief asset has been the national pride he has awakened and fostered’.34 Even Stalin’s Russia, to Macmillan’s collaborator John Loder, 28

29 30

31 32

33

34

A. Marwick, ‘Middle Opinion in the Thirties: Planning, Progress and Political “Agreement”’, English Historical Review, 79 (1964), 285–98, 285. Macmillan, Past Masters, 230. D. Ritschel, ‘A Corporatist Economy in Britain? Capitalist Planning for Industrial Self-Government in the 1930s’, English Historical Review, 106 (1991), 41–65; H. McCarthy, ‘Parties, voluntary associations, and democratic politics in interwar Britain’, Historical Journal, 50 (2007), 891–912. Times, 20 March 1934. See I. K. Kershaw, Making Friends with Hitler: Lord Londonderry and Britain’s Road to War (London, 2004) and B. W. Hart, British and German Eugenicists in Transnational Context, 1900– 1950 (Cambridge PhD thesis, 2011), on the more bizarre leanings of Tory Party MPs during this period. R. Boothby, Recollections of a Rebel (London, 1978), 110; A. Eden, Facing the Dictators (London, 1962), 64. Speech on America and the Next War, Undated – Presumably 1930, CAC, Spears Papers, SPRS 7/2.

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offered ‘hope’ and ‘lessons to be learnt’.35 While then these men were unlikely to jump from the Tory ship, let alone, like Mosley, openly endorse totalitarianism in Great Britain, they were beginning to question the Westminster structure. With unemployment topping 3 million by 1932, albeit slightly abating by the mid-1930s as cheap money and spending on rearmament produced something of successful Keynesian-monetarist mishmash, the remit of Parliament was an issue increasingly open for debate.

The war The outbreak of war in  1939 changed matters. Most of the young men who had entered the Commons in the early 1920s determined to change the role of government were, thanks to Baldwin, still often without meaningful ministerial experience. As most had seen active service during 1914–18, many were dispatched abroad to aid the war effort: Macmillan to North Africa and Loder as from 1937, in Australia.36 Even high-profile members like Lord Halifax and Alfred Duff Cooper were sent abroad (in Halifax’s case, on suspects, largely to get him out of the way) to Washington and Paris, respectively. This marked an important generational shift. In place of those fiercely critical of previous governmental policy thus entered a younger, more Baldwinian laissez-faire cohort of men with less parliamentary experience than those who had departed overseas. In part, this aided the more interventionist cause, yet it also led to the incomplete nature of its victory. Unlike those born but a few years earlier, Rab Butler – elected in  1929  – viewed Baldwin as almost a political father figure, later describing him as ‘my mentor . . . amongst living statesmen’.37 During the challenge to Baldwin’s leadership in 1930, Butler talked of his leader’s ‘preference for younger men and his understanding of them’. He found ‘it . . . sinister to think that as he services in the country, his nearest – the Old Gang – are turning in on him’.38 This rather leaves the notion that the post-1945 Butler-directed (if not led) Tory Party was

35 36

37 38

J. de V. Loder, Bolshevism in Perspective (London, 1931), 228. On the First World War cohort generally, see R. Carr, Veteran MPs and Conservative Politics in the Aftermath of the Great War: The Memory of All That (Farnham, 2013), passim. R. A. Butler, The Art of the Possible. The Memoirs of Lord Butler (London, 1971), 29. Butler Account of the Retirement Crisis, March 1931, T[rinity] C[ollege] L[ibrary], Cambridge, Butler Papers, RAB/C/4/29.

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a reaction to Baldwinism somewhat open to question.39 Speaking after 1945 on Tory interwar policy, Oliver Lytellton (elected in 1940) commented that ‘what the Socialists call “Tory misrule” . . . I think, in all fairness, should be called the days of Socialist Obstruction’.40 He then reeled off the 1925 Widows, Orphans and Old Age Pensions Act, and later extensions to National and Unemployment Insurance provision as evidence that the Baldwin era had been abundant with prudent reform. To such men, though often resorting to deriding the former Prime Minister for tactical reasons, Baldwin had it about right: the conditions of the poor should be alleviated where possible, but it was not always the government’s task to undertake this. With the Conservatives having been in office 19 of the 21 years between the wars – and the vast majority of this with thumping majorities – it was in any case a little rich to blame Labour. Initially however, things must have seemed more promising from the Keynesian perspective. The need to reinvent Conservatism was, by 1939, fairly well established. Richard Law, son of a former Conservative Prime Minister no less, was scathing in his condemnation of the party when writing just after the outbreak of hostilities: When one thinks of it – all those who were killed last time, all those who are going to be killed now – everything wasted through the stubbornness and lack of imagination of a few old men and the shamelessness of a lot of young ones. If ever I engage in politics again I shall leave the Conservative Party. You remember that man we were talking to after the division the other night, Quinlet or some such name – that’s the Conservative Party. And I don’t belong to it. This theory that it is possible to ‘educate’ the Conservative Party won’t hold water. But I don’t suppose any of us will ever be in politics again.41

Whether ‘Quinlet’ was indeed the aforementioned Quintin Hogg is difficult to ascertain. What is clear is the scorn for pre-1939 values. Certainly, this reflected in part Chamberlain’s failed foreign policy, yet the desired ‘education’ of the Tory Party was surely wider reaching than merely denouncing the men of Munich. By 1942, Major John Peto MP was warning that a ‘lack of constructive principles’ might produce the ‘danger of the public being led to believe that Conservatism was a spent force’.42 Indeed, as Rab Butler noted in a 1943 letter to Samuel Hoare, 39 40 41 42

Suggested in S. Ball, Baldwin and the Conservative Party: The Crisis of 1929–1931 (Oxford, 1988), 208. Undated Typescript, CHAN 4/17/08. Law to Emrys-Evans, 13 September 1939, British Library, Add[itional Manuscript].53239, ff. 3–4. Conservative Council Minute Book, 26 March 1942, C[onservative] P[arty] A[rchive], Bodleian Library, Oxford, NUA 3/1/2.

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the Tories needed to find a ‘more compact structure of society than has existed before’, while avoiding schemes ‘[l]eftist in character’.43 And with that he set to work.

The TRC and Beveridge Unlike the pre-1939 Keynesians, this even younger generation was afforded a role centre stage. Possessing men like Butler in Whitehall (appointed President to the Board of Education in the summer of 1941) together with, from 1943, the emergence of the Tory Reform Committee (TRC) across the country, those Tories committed to progress yet suspicious of governmental intervention were well placed. The TRC, like many of the ‘One Nation’ groups of this time, enjoys much post-facto praise. Its endorsement of Labour’s claim for the immediate implementation of Beveridge’s proposals, together with the stand it took in favour of equal pay for women teachers in the 1944 Education Act, seem to indeed augur progressive politics.44 Certainly then, some Conservatives recognized the world was changing. But the key question remains of whether they actually thought this was a positive trend. Viscount Hinchingbrooke was one of the Butler cohort of Conservatives threatening to leapfrog the Macmillans into high office. In 1943, he had become Chairman of the TRC and therein established quite the power base. Thus, throughout the early months of 1943, he set about trying to woo the masses with a propagandistic deluge outlining just how great the Tories believed progress to be. In the Evening Standard, he opined of the virtues of ‘Modern Toryism’ which rejects Individualism as a philosophy in which the citizen has few duties in society . . . It is hopeful of planning which it regards as a grand design to bring the aims of man into a true relation with the aims of the community. Modern Toryism is exhilarated by the Beveridge Report and sanguine of passing into law at an early date measures to give effect to the bulk of its recommendations.45

This final reference to an ‘early date’ is very important. The Tories, throughout the Beveridge to Butskell period, gained much by being vague on detail – particularly 43 44 45

Butler to Hoare, 8 December 1942, CPA, RAB 1/1. Addison, Road to 1945, 219. Evening Standard, 8 February 1943.

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that is, in retrospect. Thus, while in February 1943 the TRC pamphlet Forward – By the Right! claimed its raison d’etre to be ‘encourag[ing] the Government to take constructive actions on the lines of the Beveridge scheme’, and lauded their own parliamentary amendment to call for the immediate creation of a Ministry of Social Security to give purpose to the report, there would be some later backtracking.46 By October 1944, with Beveridge on the back burner for the moment, the TRC claimed that ‘it was never suggested that there was a possibility of bringing these reforms into operation until the war was over’.47 As Ewen Green observed, something of a parallel existed in the 1950s – while Harold Macmillan would later claim that post-45 full employment could be traced to the 1944 White Paper, that landmark text had only spoken in terms of ‘high and stable’ employment.48 There was, it is true, an ambiguity of purpose here. Certainly however, the Conservatives were at least trying to re-write history to suit the post-war zeitgeist. The TRC were not unique in playing fast and loose with Beveridge either. Indeed, there was relatively little contact between the liberal Beveridge and Tory Butler when the two were supposedly pursuing the mutual aim of extended welfare provision. When Beveridge wrote to Butler in October 1941 saying he would be ‘delighted to come over and have a talk over the question of social services’, one might have expected the start of years of back and forth.49 Yet this was not exactly so. While the two were not exactly unknown to one another, Beveridge’s papers at The London School of Economics (LSE) reveal no epistles from Butler. At the same time, the main dialogue involving with the TRC is a note from Hinchingbrooke thanking Beveridge for inviting him to lunch, and Beveridge’s reply praising the TRC amendment in November 1943 arguing for more constructive measures in the direction of his report.50 This did not indicate convergence, and more suggestive of a Beveridge looking for crossparty support than the Tories seeking a brave new world.51 As we saw, if TRC members  accepted the broad outlines of Beveridge’s scheme, they held severe 46 47 48

49 50

51

Tory Reform Committee, Forward – By the Right!, 1943, No. 5 and 8. Ibid., 1944, No. 12. E. H. H. Green, Ideologies of Conservatism: Conservative Political Ideas in the Twentieth Century (Oxford, 2002), 170. In H. Macmillan, Tides of Fortune 1945–1955 (London, 1969), 26, he had made the claim that the 1944 White Paper concerned ‘full employment.’ Beveridge to Butler, 24 October 1941, CRD 2/28/3. See the various correspondence during 1940–45, L[ondon] S[chool of] E[conomics], Beveridge Papers, 2/b/39–44. For the limited examples, see 22 October 1943 and 27 November 1943, Beveridge 2/b/42/3. Beveridge addressed the 1922 Committee on 2 December 1942, but it seems not to have sufficiently moved them to pass any comment, CPA, 1922/4.

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reservations over the details: particularly the removal of the old Friendly Society schemes of insurance provision.52 Quintin Hogg’s diary seems to suggest semigrudging acceptance rather than reformist zeal characterized the Tory response: Although I did not accept the attack on the [present insurance companies or approved societies], I was convinced that one had to choose between the report and the present system (unless a new solution were proposed), and that if faced with the choice I should choose the report.53

Given the party’s later attempts to gain from a political consensus engendered by wartime cooperation, this was hardly the ringing endorsement one might expect. To be sure, there were structural problems to enacting reform during the war. Historians have ably highlighted Hitler’s reluctance to intervene in domestic matters but, during the conflict at least, it was little different with Winston Churchill. His reaction to the bizarre arrival of the Deputy Fuhrer to the British Isles in  1941 – ‘Hess or no Hess, I am watching the Marx brothers’ – may be an extreme case, but it is broadly representative of his inability to react dynamically to non-military matters. Despite believing the education system to be ‘increasingly ill-adapted to present-day requirements’, and recognizing the urgent need to raise the school-leaving age, his Prime Minister’s indolence certainly hampered Butler. Asking Churchill merely for a Joint Select Committee to review the subject, he would be shot down mercilessly: I certainly cannot contemplate a new Educational Bill . . . No one can possibly tell what the financial and economic state of the country will be when the war is over. Your main task at present is to get the schools working as well as possible under all the difficulties of air attack, evacuation etc . . . We cannot have any Party politics in wartime.54

Butler’s reply revealed his frustration: ‘there is plenty to do in day to day administration. I shall certainly give my mind to this, but shall also be looking ahead, for we have, I am sure, a great opportunity to do something of lasting value for the future.’55 Just as Peto would later denounce the ‘Conservative’s strict observance of the Party truce’ then, so was Butler trying to break free from such

52 53 54 55

Q. Hogg, A Sparrow’s Flight: The Memoirs of Lord Hailsham of Marylebone (London, 1990), 211. Hogg Diary, 23 January 1943, CAC, HLSM 1/6/1/17. Churchill to Butler, 13 September 1941, CPA, RAB 1/1. Butler to Churchill, 18 September 1941, Ibid.

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a stranglehold.56 Despite the progressive rhetoric, and indeed eventual success of the 1944 Education Act, this was not always in the Keynesian directions of his immediate generational predecessors.

Burke and Hayek Conservatism is a multifaceted ideology. Claiming to represent the interests of big business, agriculture, the Church of England and, sometimes, the working class, its un-dogmatic nature lends it an elastic appeal that the free trade Liberals and socialistic Labour have to do without. For better or worse, there is no Marx or Mill to limit the boundaries of Conservative thought. Certainly however, there are key thinkers. The emergence of one and the re-emergence of a second during World War II were indicative of the ideological direction post-1945 Toryism would take. Though the turmoil of conflict, as Rab Butler’s lengthy battle to introduce educative reform saw, could often result in delayed action, Conservatives certainly took time to consider the overall tenets of their thought. While Beveridge was espousing that ‘a revolutionary moment in the world’s history is a time for revolutions, not for patching’, Tories could reach vastly different conclusions.57 Philosophically it was Edmund Burke not Thomas Paine whose take on the French Revolution seemed to strike a greater chord. Even when attempting to enact reforms to bring the state more into play, Butler was keen to remind all who were prepared to listen of the dangers of doing so. In his 1941 pamphlet A Future to Work For, the latter-day hero of progressive Conservatism was already warning of the ‘totalitarian state [which] does not allow divisions in the State, but it insists on slavery. Our great opportunity is to seek the proper relationship between freedom and order looked for by Burke in his phrase “ordered liberty.”’58 In an October speech to the party’s Central Council that year, he went even further. Again acknowledging his Burkean debt, he noted that ‘we take the view that the State no less than the individual should beware of a policy of doing evil that good may come’. Hitler was a reminder of what the state pushed to its logical conclusion could produce – and this terrified, for understandable reasons, contemporary Conservatives. Churchill’s claim that 56 57 58

Conservative Council Minute Book, 26 March 1942, CPA, NUA 3/1/2. Beveridge, Social Insurance and Allied Services, 6. ‘A Future to Work For’ by R. A. Butler, CPA, CRD 2/28/3.

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Labour would introduce some form of Gestapo to the British Isles were they elected in 1945 was swimming against the tide of public opinion, but it was not without an intellectual heritage within Conservative thought. There was also a new Edmund Burke on the scene, and one who, though having to wait for the rise of Thatcher to assume real prominence, was in fact more popular than one might think: Friedrich von Hayek. Just as Keynes had been the intellectual prophet for Harold Macmillan in the early 1930s, so did Tories line up to praise the LSE economist. Hayek’s Road to Serfdom remains a classic, and engaging, study of the dangers of totalitarianism – yet it was far from the tome of structured interventionism one might expect such Tory MPs to have praised. Certainly, Die Hards like Waldron Smithers swallowed the libertarian message whole: Socialism is assuming a new name, “State Control.” State control can only continue to function by compulsion and by force. It entails the regimentation of our daily lives, and forced labour, and its inevitable consequence, as Dr Hayek points out, is Nazism.59

This again was an extreme point of view. Few Tories – Enoch Powell was an interesting exception – would have compared Bevin or Attlee to Hitler.60 Yet Hayek was more imbedded in Tory thought at this time than all the talk of a Keynesian consensus suggests. Responding to a 1944 letter, Rab Butler was ‘glad to know that “The Road of Serfdom” [sic] has come your way: I too thought it was well worth reading. I have recently resumed the Chairmanship of the Conservative Committee on Post-war Problems and am planning to put in some hard thinking in that direction during the coming Autumn’.61 This, given the Conservative Party’s later revelry in the post-war Keynesian consensus, was a rather extraordinary statement. Hayek’s text, after all, was one which lamented ‘how far in the last twenty years England has travelled on the German path [with] . . . its increasing veneration for the state’, believing that ‘despite socialism [meaning] slavery, we have steadily moved in th[at] direction’.62 For all the progressive sops then, let us not automatically assume that Conservatives had seen some form of Damascene conversion. While post-war Tories may have tactically derided Stanley Baldwin on occasion, they shared his fear of 59 60

61 62

Smithers, Socialism, 9. S. Heffer, Like the Roman: The Life of Enoch Powell (London, 1998), 113 – particularly throughout his 1947 by-election campaign in Normanton. Butler to Stephenson, 14 August 1944, CPA, RAB 2/5. F. A. Hayek, The Road to Serfdom (Oxford, 2008) [1944], 13.

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the dangers inherent within the democratic process – particularly at a time of government interventionism engendered by global warfare.63

Keeping a lid on the right What both younger generation of Tories shared was the prevention of the more right-wing caucus within the party from having an even greater hold than in later years. As we will see, this was not always a uniform view among TRC members, but even they were usually careful to mind their language. Quintin Hogg’s desire to see an inter-party committee of young MPs who would produce an agreed programme of minimum requirements ‘sufficient to satisfy all doubts that, whatever party held power after the war, certain measures of social justice could be regarded as secure’ was matched by a desire to quash the Die Hards.64 The Catering Wages Bill is an interesting example. Seemingly an uncontentious piece of legislation to be introduced a few days before the publication of the Beveridge Report in 1943, it in fact brought about the biggest Tory vote against the Coalition Government during the conflict. At issue was control: the government’s ability to regulate employee wages. Of the 365 Conservative MPs, 110 voted against the Bill, and a further 148 members (including 9 ministers) were absent from proceedings. Thus, 68 per cent of Conservative members were not prepared to support increased state control – even during the war.65 Hogg, despite his reservations over Beveridge, was not one of them. In the run-up to the Bill, despite his accurate fears regarding the legislation’s eventual failure, he chided those MPs like Douglas Hacking who resisted change: ‘in these days I think on the whole the burden of proof lies on those who resist an impartial standing commission to enquire into working conditions, and not on those who advocate it.’66 This one must note was an important step. Similarly, as in 1927, it would be the younger MPs who would prevent the House of Lords being taken back to 1911. Just as Baldwin, supported by such figures, had rejected the restoration of the second chamber’s powers of permanent 63

64 65 66

As an example of the need to repudiate Baldwin the man if not what he stood for, concerning the contemporary American screenwriter, Oliver Lytellton wrote of ‘Earl Baldwin . . . it is a peculiarly [sad] thing that this young or youngish man should bear the name of a Conservative statesman whose name in the public estimation should be today at its lowest.’ Crossing out the final few words was not much of a concession. Hogg Diary, 23 October 1942, HLSM 1/6/1. Ibid., 31 January 1943, HLSM 1/6/1/21. Ibid., 23 October 1942, HLSM 1/6/1.

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veto, so did the Conservative Constitutional Reform Committee refuse such measures. Writing to Cuthbert Headlam, Lord Camborne noted: ‘there is, likely, after the war, to be a powerful swing to the Left. It may be said that this is all the more reason for strengthening the second Chamber will there is still time. But I should not agree with this. We shall merely be regarded as trying to buttress the forces of vested interest . . . and this will do the Party a great deal of harm.’67 Though such refusal was rooted in electoral pragmatism as much as in a desire for genuine democracy, the young Tories certainly helped prevent retrograde legislation from reaching the statute book. The Tory Party, after all, did not simply drift along during the conflict. Certainly, there was much talk about postponing domestic reforms until the end of the conflict. As Hogg noted, ‘we start with few prejudices – and progressive ideals. But we are still in the thinking stage.’68 While then ‘it would be politically dishonest to pretend that a new heaven and a new earth can be found in  all fields of national activity at once,’ what the Conservatives did need to do, urged the younger generation, was adopt a discourse their party’s right regarded as repugnant.69 Just as they recognized ‘an[y] attempt to produce a programme in detail is likely to cause divisions of opinion and to arouse criticism’, the young men peddled vagaries such as demanding ‘great permanent changes after the war’, and outlined the party’s determination ‘to create better conditions’.70 In the meantime, they limited their public actions to rejecting overtly regressive measures, and waited for their time to come.

Beyond the war For all the outward claims of progression then, the Conservative Party took a step backwards during the conflict. Old values clearly remained. As Butler put it, ‘in a world in which the State has come to stay we shall seek to find an enduring place for private initiative’ – an argument which Conservatives had been making for decades.71 Even more surprisingly, for all they endorsed his values in public, the Conservative Party Chairman was telling Beveridge that he did not ‘suppose you and I will ever agree on the best way of getting the kind 67 68 69 70 71

Camborne to Headlam, 9 October 1942, TCL, RAB/H/67/30. Hogg Diary, 22 January 1943. HLSM 1/6/1/16. Tory Reform Committee, Forward, 15. ‘A Future to Work For’, CRD 2/28/3. Looking Ahead: Progressive Conservatism Speaks’, 2 October 1944, CPA, CRD 2/28/3.

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of world we want to live in’.72 While Conservative post-war planners recognized ‘the nation is no mood to tolerate again the sense of frustration, the waste of human capacity and material wealth which resulted from prolonged and often widespread unemployment [in the interwar years],’ they did not believe that concerted governmental action could provide the remedy.73 Hinting at Beveridge, they believed that ‘the only safeguard . . . against the shallow political excitement which can be so easily aroused by mass propaganda, is to be found in the sound sense and independent judgement of the individual citizen’.74 While the primacy of the individual had always been a Conservative totem, their reconversion to a Burkean suspicion of big government was out of step with an outward acceptance of the increasing powers of the state. By the time Harold Macmillan arrived back from service overseas, postwar Conservatism had already been mapped out. Only months after Labour’s landslide victory in the summer of 1945, TRC members were revealing their true colours. Speaking in October that year, Hinchingbrooke was declaring he opposed political enemies of the government depositing monies with the National Savings scheme, which all parties had backed during the war as a means to finance the conflict.’ To Hinchingbrooke, ‘the question I now ask myself is whether, in peace time, honest Conservatives and honest Liberals ought to be asked to save and lend in order to establish Socialism, and the answer I get is that they ought not to.’75 This was hardly an atmosphere laying the groundwork for ‘Mr Butskell’, but one where Tories were encouraging open revolt against the legitimately elected administration. By the next year, the Conservative Party conference ‘view[ed] with alarm the numerous and insidious steps which are being taken day by day to undermine our liberty’, and forwarded an agenda as much concerned with the preservation of Empire as with domestic reform.76 Macmillan spoke in favour of such measures, and was to be part of the Industrial Charter Committee that followed the conference. The Charter, dubbed the ‘first landmark on the road to Conservative recovery in the field of ideas’, was to be drafted by a mixture of the generations this chapter has analysed.77 While Macmillan was joined by his fellow Keynesian Oliver 72 73 74 75 76 77

Assheton to Beveridge, 6 January 1944, LSE, Beveridge Papers, 2/b/43/1. Advance Proof of ‘Constitutional Reform’, TCL, RAB/H/67/77. Ibid., RAB/H/67/87. Hansard Parliamentary Debates (Commons), 16 October 1945, vol 414, col 1019. Conference Minutes, 5 October 1946, NUA 2/1/55. Conservative Research Department History, TCL, RAB H/46/20.

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Stanley, it should be noted that Butler and Oliver Lytellton were there too. Little wonder then that the charter, if illustrating the Tories ‘were not going ruthlessly to sweep away all planning irrespective of the circumstances’, still portrayed them as the bastion of freedom against Labour’s regimented, quasiOrwellian, order.78 The political consensus, such as it was, that followed after 1945 was unstable at best. Though, as we saw, historians such as Stuart Ball have portrayed the Butler-Macmillan era Tory Party as a reaction against Baldwinism, there may be cause to revise this somewhat. Certainly, the acceptance by most young Conservatives of the need to secure full employment was a major leap forward, but the method of achieving this was largely left open to debate. Politicians fudge details in the hope of securing the broadest possible coalition of support, there is little new in that. Yet the extent to which Conservatives managed to put aside such differences in the 1950s attests to both their political pragmatism and the knowledge that – with Labour dividing over NHS charges and nuclear policy – power was in their hands scarcely 6  years (1945–51) after it looked like they could be out of office for a generation. There were, of course, flare-ups. Peter Thorneycroft’s resignation in 1958 alongside his minions Enoch Powell and Nigel Birch showed that Second World War-generation Tories were less likely to accept increased governmental expenditure, even if it could reduce unemployment, than their immediate elders. Yet time was on their side. As Margaret Thatcher assumed the Party leadership in 1975, and Hayekian economics became an idée fixe, Thorneycroft and Quintin Hogg once again gained political influence. She, however, would have very different ideas about how to ‘put the people first’ than the Loders, Stanleys and Macmillans, as Kieron O’Hara outlines elsewhere in this volume. Essex Man would assume priority over Stockton poor. All this still matters. In late 2006, the influential Conservative backbench MP Andrew Tyrie published a pamphlet entitled One Nation Again. There, Tyrie linked the policy review then underway as a chance to instigate the fourth flowering of ‘One Nation’ conservatism – with Cameron set to follow in the footsteps of Disraeli in the 1870s, Baldwin in the 1920s and Butler in the 1950s. Such a re-calibration, Tyrie argued through referencing Disraeli’s 1872 Crystal Palace speech, should see a One Nation Tory Party ‘come to terms with a changed social and political landscape’, restore ‘pride in the country’s institutions’ and effect practical measures for the ‘elevation of the condition of 78

Ibid., TCL, RAB/H/46/45.

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the people’.79 He saw much hope in Cameron’s doing so. From 2010 however, many would argue Cameron took the lead in a government enacting brutal and in many cases front loaded spending cuts, one where real wages declined in the first 2 years after the General Election, and where public services were rolled back while the bonuses of highly paid executives (particularly, to much press comment, bankers) continued to rise.80 It is quite accurate, therefore, to cast Cameron as a new Butler: outwardly sympathetic to reform, and in his own way seeking to enact it, but with clear lines in the sand that the state should not cross. Such figures gain much public (and sometimes cross-party) kudos from being distant in tone from, in varying eras, Waldron Smithers or Margaret Thatcher. But there is an underlying connection uniting such Conservatives. It is rare that Tories demand state intervention, certainly compared to their Labour or Liberal counterparts. Yet they also gain much by appearing to be sympathetic to such notions. Unpicking where and how Conservative governments see the state in deed rather than rhetoric – their stance, in short, on Keynes and Hayek – continues to be a challenge for the party itself, its political opponents and the electorate. This paper, in summarising, contextualising and extending arguments in the author’s previous work on Veteran MPs and Conservative Politics in the Aftermath of the Great War, makes the case that ‘One Nation’ Conservative turns have not always been what they seem. Future policy makers of all parties, one hopes, will take note. Fine words butter no parsnips.

79 80

A. Tyrie, One Nation Again (London, 2006), 7. http://www.tuc.org.uk/the_tuc/tuc-20993-f0.cfm

Section Five

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9

The Limits of Power: Conservative Experience and Opportunity The Rt Hon Sir John Major KG CH ACIB

Editor Note: This is the text of an address delivered by Sir John Major at Churchill College, Cambridge, on 26 November 2010, and is included here with kind permission. This year is the 50th Anniversary of Churchill College, which was founded as a Memorial to arguably the greatest man in the history of our Islands. Sir Winston would be proud of this College. Proud that it focuses on science and technology. Proud that it houses the Archives of men and women who have influenced public policy. And proud that his daughter, Lady Soames – my friend, Mary – is not only with us this evening but is an Honorary Fellow of the College. I, too, am proud – that Churchill College has offered a permanent home to my political papers. Most are already here, and those that I’ve held back – personal notes, contemporary thoughts, partial diaries, even poems – will follow in due course. I hope that, taken together, these will add to knowledge, and be of use to historians. Tonight, I want to draw lessons from my own experience, and look to the future. I speak as a politician. Not an ideologue and not a theorist. I became a Conservative over fifty years ago, when I was barely in my teens and living in a multi-occupied, multi-racial house in Brixton. I have never regretted my choice. I don’t claim that every aspect of Conservatism was – or is – to my taste but, taken as a whole, I believe the philosophy offers more choice, more individual liberty, more opportunity and more hope than any other. Some have wondered why a boy with no money, no influence and no family background in politics should become a Conservative. The answer is simple. Socialism told me a benevolent State would help me – eventually. Conservatism

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offered a way up and out of modest circumstances. It told me there were no boundaries. Not everything turned out as I hoped: in politics, as in life, it rarely does. I had hoped my background would enable me to make Conservatism the natural choice for future generations from communities like Brixton. But events took over. When I became Prime Minister, the economy was broken and needed mending. And when it was back to full health – and the way clear to tackle the problems of under-privilege – we lost the election. But, even in failure, there are lessons and I shall try to set them out. Some of what I say may re-write perceived history, but the truth deserves an airing even if it up-ends myth. I shall then turn to the future. Let me set some context. Over the last 60 years, the world has changed at a pace without precedent in human history. Nothing is as it was, nor will be as it is. Instant, accessible and cheap electronic communication has changed the very nature of politics. Direct face-to-face contact with electors is diminishing. Public meetings are out of fashion. Mass membership of political parties is over. Door to door canvassing is falling away. More than ever before, the political message is filtered through the media or, increasingly, the internet. Even soap boxes are out of date. The once hallowed distinction between “news” and “views” has gone. “News” is now part of a sharply competitive entertainment industry: one might call it – “infotainment”. Editors select what is “news” and determine its prominence. They can “run” with a story, or close it down. They may – or may not – be dispassionate. None of this is new. But the scale of it is. Satellite coverage has multiplied the number of channels. Competition has made the media more demanding, more intrusive. Media outlets thrive on drama and sensation and – in its absence – are likely to create it. There’s no point in complaining about this: it’s the world in which we live. And politicians cannot simply blame others for public intolerance towards them. To be elected, they set out promises but – all too often – reality intervenes and the promise falls. Initially, the voter is merely annoyed but, where this re-occurs, they assume the promises were at best foolish, or at worst, fake. Sometimes they were. But, more often than not, it is the unforeseen event that turns an honest intention into a broken promise. Today, every Government is at the mercy of the global market. François Mitterrand – always more of an historian than politician – used to express alarm that the volume and velocity of financial flows were beyond the control of any

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Government. He was right. Sterling’s exit from the ERM taught us that seventeen years ago. Today, the Market is even more powerful. As the Global Market has grown, the influence of Governments has shrunk: even basic policies such as tax must conform to international norms, or investment moves away. The same internationalism is evident in foreign policy. More than ever before governments only share in the solution of common problems after negotiation in a plethora of international bodies. This is frustrating: and one reason why successive British Prime Ministers are less proEuropean when they leave Office, than when they enter it. The uncomfortable truth is that the limits of power for politicians are narrower than many suppose. The modern Head of Government may wish to bestride the political stage like a colossus, but events can reduce him (or her) to no more than a cork bobbing on the waves. But not always. Consider: if Labour hadn’t imploded during the “Winter of Discontent”, would Margaret Thatcher have been able to enact such wideranging reforms in the 1980s? I doubt it. But the Trades Unions had exhausted public patience. And a lurch to the left made Labour unelectable. Out of this chaos, came opportunity. Margaret Thatcher saw her chance and seized it. Even so, she was fortunate. She had a clear cut majority in Parliament. It is far easier to be bold with troops united at your back, than dis-united at your throat. In the 1990s, the number of euro-sceptic MPs exceeded our majority, and made European policy an exhausting daily battle: this battle spilled over beyond matters European. That is why David Cameron was wise to agree a five-year coalition with the Liberal Democrats. It secures a Parliamentary majority, without which the unpopular policies that are now necessary could too easily be blocked. But, even with a working majority, Prime Ministers must bend to reality. Again, let me draw from my own experience. In  1989, Margaret Thatcher and I took Sterling into the Exchange Rate Mechanism. We did so to general acclaim. For 50 years, inflation had bedevilled the UK economy. Two Chancellors, Geoffrey Howe and Nigel Lawson, both believers in the free market – had wished to enter the ERM. Margaret said no. As Chancellor I, too, then advocated entry. Margaret said yes. She did so with her eyes open. She was persuaded by reality. There was no alternative. Prices and mortgages were soaring and we had to bring them down. We entered the Mechanism to do so. This mattered to Margaret. Those for whom

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she most cared – the strivers and hard workers – were among those most hurt by rising prices. And because of my own life experience, it was crucial to me: I knew what life was like when the week lasted longer than the money. That is the evil of inflation. The ERM medicine was acutely painful, but it did drive prices down, and set us on a path to economic well-being that lasted over fifteen years. Let us not forget that Britain began many years of non-inflationary growth in April 1992 – not in May 1997. As we returned to growth, I wished to exit the Mechanism. It had done its work and I’d never thought of it as a stepping stone to economic and monetary union. It was time to leave. But the dilemma was how to do so without ending up with a lower exchange rate and higher inflation. This dilemma was still unresolved when the Market swept Sterling out of the ERM: an economic liberation, but a political disaster that grew to dominate the perception of all we did in Office. After our ejection, the myths began. We had entered at the “wrong rate” said free-market critics, forgetting we entered at the Market rate. Then, early Tory tea-partiers suggested that Douglas Hurd and I had “bullied” Margaret into submission. If they believed that they must have been drinking more than tea. It was widely asserted that this episode had “wrecked our reputation for economic competence”. At the time, such a sentiment had resonance. But critics should pause. The decision I had taken at Maastricht – to opt Sterling out of the Euro – has served Britain well. It was an economic decision based – not on sentiment for Sterling – but on the judgement that diverse economies would not converge and a crisis, one day, would follow. There can surely be no doubt now that my decision has proved to be right – politically and economically. As ever, facts are more potent than the words of critics or supporters. On the day I became Prime Minister, interest rates were 14%, unemployment was soaring, the economy was collapsing, inflation was 9.7% and the tax burden 36.3%. When I left Office, interest rates were 6%, unemployment was falling, the economy was growing healthily, inflation was 2.6% and the tax burden 36.6%. No other Government had passed on such a sound legacy. Yet few acknowledged the turnaround, or credited the Government with it. We Conservatives are to blame. In Government, we should have explained more and assumed less. In Opposition, after 1997, we shouldn’t have let myths take root: but we were demoralised by defeat – and did. This enabled Labour to take credit for the economy we had created, and helped keep us out of Office for thirteen years. This is a lesson that should not be forgotten.

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New Labour offers lessons, too. In 1997, they gained a huge majority from a supportive public. They could have done anything. But, after eighteen years out of Office, they were determined not to return to Opposition. The public were told what focus groups said they wished to hear. Good news was announced and re announced. Bad news was buried. And the electorate was bribed with its own money. Emerging problems were ignored and are still with us. The general effect was a giant Ponzi Scheme, in which everyone was made to feel better whilst being fleeced. In its own way, it was genius. But it was not serious Government – and those emerging problems are now worse. Yet Labour’s neglect of these has left David Cameron an opportunity similar to the one Margaret Thatcher seized: once again, there is a mood of public tolerance to change. So let me turn to the future. Our national well-being is the work of generations: the Coalition can make progress, but the challenges are so deep they can’t be overcome in five years. Governments often over-estimate what they can do in five years, but under-estimate what can be achieved in twenty years. We need to think – and plan – long-term. This brings me directly to the Coalition Government. Many Tories and Liberals are hostile – or, at least, agnostic – to the Coalition. I approve of it. In present circumstances, it has many attractions: not least that two Parties are more likely to enjoy a tolerant electorate for policies that are painful. Can a Coalition Government succeed? I think so. Coalition, per se, is not a problem. The Conservative Party is, itself, a coalition: a broad Church that is more a way of life than an ideology. To win elections it must attract support from the Centre and, where it can, from the Centre-Left. If it falls into schism, it repels electors. Such internecine warfare scarred my own Premiership, and the leadership in Opposition of my three immediate successors. When the Conservative Party shrinks into itself, it shrivels into un-electability, as it did for some years after 1997. Can the Coalition achieve its purpose in five years? It will be hard pounding but its programme is essential to national well-being and so, if uncompleted, I hope some way can be found to prolong co-operation beyond this Parliament. It may be that a temporary alliance will turn into a mini realignment of politics: after all, in a world that is changing so comprehensively, why should politics not change, too? Neither Party will admit that possibility at present, not least because it would upset their core vote but – if events turn out well for the Coalition – I, for one, would not be surprised at that outcome.

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I seem to recall the Liberal Party was saved as a Parliamentary force in 1951, by the Conservatives not opposing five of its MPs: progressive co-operation is nothing new. It can be done. I am Conservative to the bone but, if it is in the interests of the Country, it may need to be done again. The Coalition has a daunting agenda. They must repair our national finances. Restore economic efficiency. Reconfigure foreign and European policy. Help an under-class which few wish to admit is there. Recognise that, while much of our education system is excellent, all of it is not. Reform an out-of-date welfare system, and face the myriad problems of an ageing population. Nor is that all. Climate change, population growth and the alleviation of poverty will demand attention. So will trouble spots in the arc of uncertainty from Syria to Pakistan. Do not be surprised if politics is in a hyperactive phase for years to come. Some priorities won’t wait. National well-being depends on putting the economy right. So does international influence. And the world won’t stand still while we recover. Governments can’t create wealth. The private sector can. To help them, the Coalition need, within this Parliament, to offer certainty in the tax and regulatory regime. Revisit employment law to create jobs. Lower taxes, and remove obstacles to growth. Tone of voice matters, too: the Government must promote success, and condemn the sour envy and resentment that so often derides it. There is one old truth that should not be forgotten. If the State is too big, the Private Sector will be too small. A smaller State – focused on what it must do and what only it can do – together with a larger private sector is the best way to national prosperity. Some may reject this. They like big Government. Labour policy is to regard any “cuts” as a plot to shrink the State, thus ignoring the inconvenient truth that, had they won the election, they would have been forced to a similar policy. A smaller State is not a devil-take-the-hindmost policy of pandering to the successful and ignoring the fragile. It is, in fact, quite the reverse. We are lost if the private sector doesn’t create jobs and yield tax revenue. We need tax revenue to fund good public services and pay for welfare. If the Government spends taxpayers’ money on what it need not do, it cannot spend money on what does need doing. Anyone who argues against that logic opens up a big gap between themselves and commonsense. Conservatives should not shrink from that debate.

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Nor should they shrink from any debate about how to maximise our national self-interest. In the recent Defence Review it was decided to extend the present life of Trident, but not yet to replace it. Few subjects so exercise Conservatives as national security but I believe this was the right decision. A bigger decision on replacement lies ahead with some unavoidable questions: what is the opportunity cost of Trident in the loss of conventional capability? In what circumstances, and upon whom, is Trident likely to be used? These are uncomfortable questions, but they must be answered before billions are committed. As our military power is reduced, our “soft” power – that is, diplomacy and the ability to achieve our purpose by persuasion – should be increased. David Cameron and William Hague have seized on this point and it is important they pursue it. As a middle-ranking nation, we must make the most of our assets. This means promoting diplomacy, and focusing it rigorously on British priorities. David Cameron’s policy of increasing trade with future economic giants is very much in our national interest. When we export more to Ireland than to China and India, something is wrong. Sustaining overseas aid, as the Government is doing, is a legitimate part of this policy. So is boosting education links and improving overseas broadcasting. We are lucky. We have the enviable gift of our language and culture to build on. Soft power must become an indivisible part of long-term policy, not an occasional add-on. This isn’t altruism: it is vital to our own long-term interests. Our diplomacy is a priceless asset. In the United Kingdom, our most important alliance is, and will remain, with the United States. We are – to echo David Cameron’s phrase – the junior partner. But our diplomatic skills are certainly no less than America’s and – with our historic experience of troubled regions – we should not hesitate to raise our profile. We have often led policy before. In Europe, the Single Market and enlargement were British-led initiatives. The “Safe Havens” for the Kurds policy, which saved hundreds of thousands of Kurdish lives after the first Gulf War, was born in London, created in Europe, promoted through the Commonwealth and imposed in partnership with the United States. We should lead more often. If we do, others may follow. We should not underestimate our influence. And where we have reservations, we should be less ready to follow unquestioningly the lead of the United States. The good partner is not always the pliant partner: sometimes, candid criticism is the best form

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of friendship. Such a stance is not only more appropriate for a Sovereign and Independent nation like Britain, but we delude ourselves if we don’t recognise the inevitability of America looking more and more to the Pacific. They are realists and we must be so too. Robust British diplomacy will help and not harm the Alliance. There is an issue David Cameron and his successors cannot avoid: the character and reputation of Government. Parliament has had some serious setbacks in the last thirty years that have damaged its reputation. There are many reasons for this. One is political funding. The present system is not sustainable. When wealthy individuals make large donations – as they do to every mainstream Party – the suspicion lingers, even where it is wholly unjustified, that some of them seek undue influence over policy, or recognition in some other form. This is unhealthy for politics, and a constant headache for Party Leaders. A cap on donations will one day need to be introduced. Similar reservations apply to funding from special interest groups, notably Trades Unions and business corporations. Limits must be placed on these contributions and – much though I dislike the thought – if that leaves a funding gap, I would rather Parties trimmed their expenditure, or the taxpayer met it, than our political system was perceived, however unfairly, as shady. Greater scrutiny leads to a public awareness of shortcomings among Parliamentarians that may have gone unnoticed in earlier years. There have been too many instances of personal frailty in all political Parties: the most damaging are those that involve financial mis-behaviour. Cash for Questions – which occurred in the 1980s but only emerged to cripple the Government of the 1990s: and Cash for Peerages – which erupted in the last decade – were both pivotal to public alienation, as were the spicy revelations about the expenses claims of Parliamentarians in the Lords and Commons. Of course, the publicity in some cases was unfair, but the reality of criminal prosecutions shows that much was wrong. This dovetails into a bigger problem: alienation of the electorate. The growth of the far right, the fall in voting levels, the declining involvement in politics, and public estrangement from it, all add to the widespread feeling that Parliament is “out of touch” and politicians and public are too far apart. It is easy to see why. People work hard. Pay too much tax. Earn – sometimes a fraction – too much to qualify for social benefits. They fear that if immigration is too high it will cost them their jobs. Better homes seem beyond their means. They worry their children will rack up debt at University.

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These people are not selfish. Or racist. They are worried, some even frightened, by their own circumstances. Often they are economically immobile. They feel trapped. They believe no-one understands. Or cares. The Coalition can offer hope by speaking up and acting for them. It won’t be easy. Dis-enchantment is always greatest in difficult policy areas: immigration levels, sink estates, poor schools, taxation, the division of the welfare cake. The Coalition are addressing some of these problems: in all of them, a frankness and candour about the difficulties – and the time required to cure them – would reassure many who feel alienated from the political elite. It is never a mistake to set out long-term objectives if they give hope. Other objectives should be to tackle the fearsome bureaucracies that bear down on them. The Man in Whitehall or Town Hall does not know best. They are, too often, arrogant in their treatment of the citizen. We should be wary of the individual liberties they crush. Tackle these issues, and the Coalition may hit the political mother-lode. Far more important, they will restore faith in Parliament. In so many areas I welcome the ambitions of the Government. It is fashionable to be pessimistic and to sneer that Britain does not count any more. I profoundly disagree with such cynicism. It is not only cheap – it is wrong. In the last decade I have travelled the world and seen my own Country from afar. I have heard the world’s view of it. And – to that wider world – we do matter. We matter because of our history. Our language. Our law. And we matter because of what we can do – in commerce and industry, in science, in the City. And we matter because of what we are. Our quality as a Partner. Our reputation as an honest broker. Our generous impulse to crisis. Our culture. Our theatre. Our literature. Our tolerant instincts as a Nation. Sometimes, in politics, it is necessary to stand back and take stock. Now is such a moment. Our world has many complexities, but far more opportunities. If we arrange our affairs to take advantage of them, our future can be so much more promising than even the most optimistic can believe. For nearly seven years I was Prime Minister of this Country. I am proud of much of what we did. There are things I regret we did not do. But I was always proud of my Country. Of Great Britain and Northern Ireland. Its history. Its institutions. Its great figures like Winston Churchill, the Founder of this College. I still am: for all its shortcomings, I know of no place in which I would rather have served. And no place I would rather be.

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Neo-Orthodoxy: Conservative Economic Policy in the Twenty-First Century Irwin Stelzer

Editor Note: This is the text of an address delivered by Irwin Stelzer at Churchill College, Cambridge, on 26 November 2010, and is included here with kind permission. It is not easy to set down ideas equally relevant to British and American conservatives. The centre of gravity of American politics is to the right of the centre of gravity of British politics. British conservatives are comfortable with government activism in areas of domestic policy that American conservatives regard as no-fly zones, government-run health care being perhaps the most notable example. As a rough rule of thumb, Americans do not like their federal government to command much more than 20 per cent of national GDP, while in Britain even Margaret Thatcher kept that figure close to 40 per cent. It was only when Gordon Brown appropriated 50 per cent of the nation’s output for government use that the voters decided he had stepped over the hazy line that separates the government from the private sector. Despite these differences, conservatives in Great Britain and the United States have a special relationship: there is a continuous interchange of ideas on key policy issues. British conservative politicians have studied welfare reform in America, and American conservatives are watching with interest as Conservatives in the coalition government attempt to follow Iain DuncanSmith’s lead and adapt American welfare-to-work programmes to the somewhat different circumstances prevailing in Britain. We are also watching with interest, and not a touch of envy as your Parliamentary dictatorship implements what neither our President nor our congress acting alone can attempt – a serious, systematic attack on fiscal deficits.

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A warning to readers: I am no conservative philosopher. I am merely a practising economist whose theoretical tools have been dulled and bent out of shape by collision with the real world, in which second best reigns.1 This collision with reality has made me less certain than many conservatives on both sides of the ocean seem to be when confronted with policy questions. First, I was never certain that Keynes had it right when his thought was the received wisdom, and I am not now certain that those who believe they are following their master’s advice by attempting to cope with recession by substituting government spending for the demand and investment withdrawn by privatesector players have it right.2 And I am deeply suspicious of people who profess to know what cure for our current economic predicament the ever-pragmatic Keynes would recommend. It is difficult for me to imagine that this brilliant investor, surveying the possibility of further rating downgrades for the debt of your country and mine, would nevertheless recommend spending plans that ignore the probable reaction of the bond market to high and sustained deficits. Equally, I am not certain that free trade, which appeals so much to my conservative, free-market friends, is an unambiguously good idea, or that Adam Smith was wrong when he laid out the circumstances under which a whiff of protectionism is a better idea than rigid adherence to the notion that free trade is in  all circumstances likely to maximise national wealth. Smith thought it necessary ‘to lay some burden upon foreign, for the encouragement of domestick industry . . . when some particular sort of industry is necessary for the defence of the country . . . . [and] when some foreign nation restrains by high duties or prohibitions the importation of some of our manufactures into their country. Revenge in this case naturally dictates retaliation . . . . ’3 Surely, China’s decision to undervalue its yuan provides the sort of threat to US national security that Smith had in mind, since the pile of American IOUs 1

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I take comfort from one economist’s defence of Alfred Marshall, criticized by Joseph Schumpeter and others for being imprecise. ‘Marshall’s reply would probably have been that reality, unlike theory, does not always lend itself to the rigorous categorisations of the pure logician, and that the first duty of the economist is to be faithful to the viscosity and plasticity of the world outside the mind.’ David Reisman, The Economics of Alfred Marshall. London: The Macmillan Press LTD, 1986, 71. ‘. . . Keynes gave little thought to the challenge of limiting government’s role, or of defining its relationship to the market, or of devising institutions that might serve such purposes . . . . He cast aside the moral assumptions of the liberal order. . . ’ . For those thoughts and much more, see James Piereson, ‘The cultural contradictions of J. M. Keynes’, The New Criterion, May 2009. See also, ‘Keynes has been revived because he understood that markets are very often irrational. Unfortunately, few of those who urge that we go back to him seem to have understood why he believed this.’ John Gray, ‘We simply do not know!’ London Review of Books, 19 November 2009, 13. Adam Smith, An Inquiry into the Nature and Causes of the Wealth of Nations. All references are to the edition edited by R. H. Campbell and A. S. Skinner (Oxford: Clarendon Press, 1976), 467–72.

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in the vaults of China’s central bank gives the regime too much power over America foreign policy. Moreover, Smith continues, ‘Humanity may . . . require that freedom of trade be restored only by slow gradation’ lest ‘a great number of people . . . be thrown all at once out of their ordinary employment . . . ’ .4 Besides, Smith was less interested in extending the efficiencies of a pin factory’s division of labour into international dealings than in finding ways to increase the wealth of nations – and it is not at all clear that ‘free trade’, as it must be understood in today’s real world of currency manipulation, barriers to the flow of capital, and restrictions on the free movement of labour across national boundaries, increases the wealth of nations. I think there is much wisdom in Joseph Schumpeter’s emphasis on the role of creative destruction, but am not certain how to treat the externalities – the costs imposed on society – associated with that special form of creativity. The great man himself worried ‘. . . about the social costs involved in destroying existing structures . . . ’5 After all, the beneficiaries of the creative gale are different from those who have seen the value of their assets, and their jobs, destroyed. This is not to say that we should try to prevent the gale from hitting our shores; rather, it is to suggest that policymaking does not stop, indeed, merely begins, when the gale blows through some industry. For if we do not ameliorate the impact of change on innocent bystanders (I exclude rapacious unions from that category), opposition to change, the lifeblood of a capitalist economy, will multiply. I was never certain that monetarism is the panacea that Margaret Thatcher’s conservative admirers contend it is as they labour to define a variety of ‘M’s that compete for the attention of those trying to measure the money supply. But neither am I certain that all things considered (especially the alternatives), we can safely ignore it as a tool to manage economic cycles. I am not certain that shouts of ‘second best’ should cause economists to pack their kits and consider themselves disqualified from advising on policy. Rather, I am persuaded by historian Gertrude Himmelfarb that ‘the attempt to realise the unrealisable is likely to be pernicious . . . . The best . . . may be an invitation to the worst. The perils of utopianism are by now all too familiar’.6 Second best is 4 5

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Ibid., 469. Joseph A. Schumpeter, ‘Science and Ideology’, American Economic Review, March 1949, reprinted in Richard V. Clemence (ed.), Essays on Entrepreneurship, Innovations, Business Cycles, and the Evolution of Capitalism (New Brunswick and London: Transaction Publishers, 1997), 273. Schumpeter made this remark in a section of the paper attacking those who would break up large companies in the interests of preserving competition. ‘In Praise of the Second-Best’, Standpoint, May 2009.

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messy, but realizable; first best is neat and somewhere between unattainable and dangerously Utopian. Most of all, I am not certain that many conservatives’ fear of ‘unintended consequences’ is a reason to leave market power and market imperfections free from government intervention, for several reasons. Adam Smith’s ‘invisible hand’ describes how merchants and others, pursuing private gain, produce the unintended consequence of benefits for the nation.7 And lovers of free markets have always applauded those particular unintended consequences, in good part because they are unintended. Not all unintended consequences are also undesirable. We have to recognize that only utopians believe they can devise policies that will not have unintended consequences. Such consequences are risks practical men know are a cost to be lived with if policy changes are to be made. As Irving Kristol long ago pointed out, it is a ‘utopian fantasy’ to think that we can ‘eliminate all of . . . [capitalism’s] costs while preserving all its benefits’.8 Nor can we set as our policy goal what R. H. Coase called ‘a system which lives in the minds of economists but not on earth’.9 So we have to do our best, and if the unintended consequences prove also to be undesirable, do what we can to ameliorate their effect. In short, if conservatives are to play an active role in policymaking, we will have to have modest goals and be willing to admit error and make changes when we get it wrong, when the undesirable unintended consequences outweigh the intended. There is nothing wrong with sweeping after oneself. That is only one reason that I do not live in terror of policies that of necessity require government action. Another, pointed out by Himmelfarb, is that government has a role to play in legitimizing and de-legitimizing certain behaviour10 – a good reason why conservatives’ knees cannot jerk in negative reaction to any new government initiative, as liberals’ knees spasm when there is talk of cutting any programme other than national defence. Example: government in my country and in yours is attempting, with some success, to delegitimize some aspects of bankers’

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‘Smith and his circle loved the paradoxes of unintended consequences.’ James Buchan, Adam Smith and the Pursuit of Perfect Liberty (London: Profile Books, 2006), 110. Irving Kristol, ‘Adam Smith and the Spirit of Capitalism’, in Neoconservatism: The Autobiography of an Idea (New York: The Free Press, 1995), 258–99. R. H. Coase, ‘The Institutional Structure of Production’, in Essays on Economics and Economists (Chicago: The University of Chicago Press, 1994), 5. See Gertrude Himmelfarb, The De-moralization of Society: From Victorian Values to Modern Values (London: Institute of Economic Affairs, 1995), espec. ‘Epilogue’, 221–7.

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compensation. Conservatives should not be upset at these efforts, because the abuse at which they are aimed is clear, the behaviour being targeted, has the potential of bringing market capitalism into disrepute, and causing severe macroeconomic disruptions, and the alternative is extending the long arm of the government into bank board rooms, where it will in the long run do more harm than good. Perhaps more important, the effort to deligitimize bankers’ behaviour has some important positive externalities, well understood by Adam Smith: “. . . Beside all the bad effects to the country in general . . . resulting from a high rate of profit; there is one more fatal, perhaps, than all these put together, but which, if we may judge from experience, is inseparably connected with it. The high rate of profit seems every where to destroy the parsimony which in other circumstances is natural to the character of the merchant. . . . If his employer is attentive and parsimonious, the workman is very likely to be so too; but if the master is dissolute and disorderly, the servant . . . will shape his life too according to the example which he sets him . . . The capital of the country, instead of increasing, gradually dwindles away . . . ” .11

In urging conservatives to abandon government-is-evil,12 I will at times follow the suggestion of James Buchanan, who has this advice for those interested in stimulating thought, ‘In a brief treatment it is helpful to make bold charges against ideas or positions taken by leading figures.’13 I mean no disrespect for the great proponents of limited action, at least in the economic sphere. Indeed, I remain a devotee of much of what Adam Smith and others had to teach, what I consider to be the great orthodoxies. But they lived in a society that no longer exists. Adam Smith wrote at a time when shame was a brake on economic behaviour, when transactions often occurred between parties for whom reputational capital – a concept difficult to grasp in many political circles – was their most important asset.14 That was then, this is now. 11 12

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Wealth of Nations, 612. I confine myself, of course, to economic policy, leaving the important questions surrounding social policy to others, where conservatives’ need to review their positions is equally great. ‘. . . Familiar conservative responses to social problems are inadequate to the present situation. It is not enough to say that if only the failed welfare policies are abandoned and the resources of the free market released, economic growth and incentives will break the cycle of dependency and produce stable families.’ Gertrude Himmelfarb, The De-moralization of Society: From Victorian Values to Modern Values (New York: Alfred A. Knopf, Inc, 1995), 246. James M. Buchanan, What Should Economists Do? (Indianapolis: Liberty Fund, 1979), 20. ‘[Adam Smith], that amiable, decent genius simply could not imagine a world in which traditional moral certainties could be effectively challenged and repudiated.’ Irving Kristol, speech at the American Enterprise Institute.

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We cannot merely wave our copies of The Wealth of Nations at those who would expand the role of government and expect that act to have the force of waving a cross at a vampire. Changing times and standards of personal behaviour are not the only reasons we need to adapt our orthodoxies. Markets, too, have changed. Smith could rely on more-or-less well-functioning markets, cleansed of a few non-trivial imperfections, to increase the wealth of nations, and preserve the existing order. We are in a different circumstance: we cannot rely only on markets as they now function to preserve capitalism. We live in a world of too-big-to-fail, trade union interventions that distort labour markets, multinational companies forced to adopt suboptimal operating methods in order to adhere to the laws and customs of several countries, currency manipulation, and a host of factors that drive us from the world of economic theory into the world of second best. Those of us who regard ourselves as conservatives and admire Adam Smith should attempt to create what we might call a neo-orthodoxy, a new capitalism rooted in old verities adapted to the way we live now. Indeed, it is imperative that we undertake the task now for, as University of Chicago Professor of Entrepreneurship and Finance Luigi Zingales has recently put it, ‘The nature of the [current] crisis, and of the government’s response, now threaten to undermine the public’s sense of the fairness, justice, and legitimacy of democratic capitalism.’15 None of this is to be insensitive to Milton Friedman’s warning that ‘the bulk of the intellectual community almost automatically favours any expansion of government power so long as it is advertised as a way to protect individuals from big bad corporations, relieve poverty, protect the environment, or promote “equality”’.16 That is a trap we must avoid. Start with an undeniable fact: capitalism has been unrivalled in its ability to produce material well-being, and to distribute those goods and services more widely than any other system with which societies have experimented. ‘The bourgeoisie,’ noted Karl Marx and his fox-hunting sidekick, Friedrich Engels,17

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Luigi Zingales, ‘Capitalism After the Crisis’, National Affairs, Number 1, Fall 2009, 22. The Chamber of Commerce’s $100 million campaign to extol the virtues of free markets will not mention ‘capitalism’ or ‘risk taking’ because focus groups found those words ‘universally problematic’, according to Chamber spokeswoman Tita Freeman. BUSINESSWEEK, 17 August 2009. In his introduction to F. A. Hayek, The Road to Serfdom (Chicago: The University of Chicago Press, 1994 edition), xv–xvi. Tristram Hunt, Marx’s General: The Revolutionary Life of Friedrich Engels (New York: Metropolitan Books, 2010).

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‘during its rule of scarce one hundred years, has created more massive and more colossal productive forces than have all preceding generations together.’18 Marx and Engels had it right. But not about how the results of this achievement would be distributed. The ‘poor’ in the remaining communist paradises have living standards that are truly appalling, and those in capitalist countries live better than do most of the middle classes in socialist economies, and far better than those in the kleptocratic economies of Africa and the Middle East, despite the vast natural resources of both of those regions. And the so-called Brics19 – Brazil, Russia, India and China – have a long, arduous path to travel to duplicate the living standards produced by capitalist economies and prove that centrally managed (Russia, China) or bureaucrat-heavy (India) economies can indeed duplicate the performance of the American economy, at the same time maximizing the scope of individual freedom.20 China, with a per capita GDP one-seventh of the US level and its families’ consumption of goods and services one-fourteenth that of American households,21 is already running into serious limits to its growth from its failure to internalize a host of environmental externalities, its inefficient allocation of capital by bureaucrats, banks with balance sheets laden with dicey assets,22 and the inflation-inducing effects of its trade policy. And India is struggling, not entirely successfully, to untangle itself from the corruption, regulations and the bureaucracy that represent the worst of the legacy left by Great Britain. As for Russia, its corruption-ridden economy lumbers forward only because it has been blessed with enormous natural resources; there is little sign that its crony socialism can morph into a vibrant twenty-first-century economy capable of attracting much-needed foreign capital and technical know-how, as President Medvedev repeatedly takes the risk of pointing out. The negative effects of too much government in other countries, and Milton Friedman’s appropriate warning about the ‘intellectual community’s’ love affair 18

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Karl Marx and Friedrich Engels, The Communist Manifesto (London: Penguin Classics, 2002), 224–5. The term was invented by Goldman Sachs to describe countries containing some 40 per cent of the world’s population, and is not universally regarded as a grouping useful for analytical purposes. Recall Irving Kristol’s remark, ‘In the United States, where liberal democracy is not merely a form of government but also a “way of life,” capitalism and democracy have been organically linked.’ ‘Corporate Capitalism in America’, in Neoconservatism: The Autobiography of an Idea (New York: The Free Press, 1995), 211. Arthur Kroeber, ‘5 Myths about China’s economic power’, The Washington Post, 11 April 2010. A ‘growing issue is the one of ballooning bad debts in China; . . . unknown levels of distressed public debt; . . . it would not be surprising to see heavy credit losses at some point in the future . . . ’ . Merrill Lynch Wealth Management, Issue 199, 11 July 2011.

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with big government, do not mean that there is no role for a conservative government beyond cutting spending and taxes, important as those can sometimes be. I would suggest five: fostering competition, regulating where necessary, internalizing externalities, offsetting or correcting other market failures and ensuring that the results of the system are deemed to be equitable. 1. Government has an obligation to foster and preserve competition.23 Competition performs both an economic and a social function. It forces firms to vie for consumer favour by offering better and better products at lower and lower prices. And it preserves an open economic system, in which incumbents are prevented from blocking the entry of upward thrusting newcomers, thereby contributing to social mobility.24 In practice, this means the vigorous prosecution of criminal cartels; the prevention of the use of exclusionary tactics such as predatory pricing and full-line forcing; and the refusal to allow mergers, the effect of which may be substantially to lessen competition. Surely, conservatives can recognize that only the government can perform these chores. I recognize that those who fear government intervention in markets have a point when they argue that it is often difficult to distinguish between hard competition and predatory behaviour. I would suggest that the difficulty of making such a distinction exists more in the minds of academic critics of the antitrust laws than in the minds of those who have actually undertaken the task, armed by facts in a specific situation. If we do not preserve competition, we do not preserve markets – instead we invite the clumsy hand of the regulator to replace the invisible hand. Hayek saw that once monopoly power is acquired, ‘the only alternative to a return to competition is the control of the monopolies by the state – a control which, if it is to be made effective, must become progressively more complete and more detailed . . . . Capitalist organisers of monopolies . . . are . . . short-sighted . . . in believing that they will be allowed not only to create but also for any length of time to run such a system.’25 Indeed, Hayek goes on to argue that even if direct 23

24

25

Smith used the phrase ‘perfect liberty in commercial relations’, which he held was essential to the attainment of ‘natural prices’, the level to which competition was always driving them. Two scholars have noted, ‘One might even go so far as to assert (as John Stuart Mill did much later) that it is on the concept of competition that any specific claim that political economy might have to scientific status ultimately rests . . . ’ . Murray Milgate and Shannon C. Stimson, After Adam Smith: A Century of Transformation in Politics and Political Economy (Princeton and Oxford: Princeton University Press, 2009), 81. John H. Shenefield and Irwin M. Stelzer, The Antitrust Laws: A Primer (Washington: The AEI Press, 2001) (fourth edition), 10–14. Op. cit., 47 and 214.

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control of monopolies results in a deterioration of the quality of service, ‘this would be a small price to pay for an effective check on the powers of monopoly’.26 Better, surely, wherever possible to root out monopoly power than to live with these inefficiencies. More important, if we do not preserve competition, we foreclose oppor­ tunities for thrusting newcomers to challenge existing institutions27 and to introduce new technologies.28 Most radical innovations are developed and, with help, commercialized by individual entrepreneurs, unencumbered by the fear of making existing, sunk capital obsolete. By one estimate, these entrepreneurial innovators account for 65 per cent of long-run growth.29 In the real world, these innovators are heavily dependent at some early stage – after they have gobbled up their own savings and those of family members and a few friends – on venture capitalists, known to all who solicit their support as VCs. And the first questions these hard-headed and well-informed investors ask is, ‘How will the incumbent respond? Will such as Microsoft or Intel, both with dominant market positions, be permitted to engage in predatory pricing, or coerce customers into refusing to try a new product, or distributors from handling it?’ In the absence of vigorous antitrust enforcement, the answers to these questions will be ‘Yes’, and the VCs will zip their wallets. Schumpeter’s gale of creative destruction will blow harmlessly out to sea. Policymakers in Britain, who more often than not are comfortable with and favour establishment businessmen, should take this warning seriously as they try to figure out why their country does not have as vigorous a venture capital sector as it needs. Even more important to the survival of capitalism, these artificial barriers to entry, if unchallenged, will prevent many fledgling entrepreneurs from climbing the income and social ladders. And it is just such mobility that, in my country at least, has historically minimized the sort of attack on capitalism by ‘have nots’ on ‘haves’ that characterize other societies. 26

27

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29

Ibid., 217. Hayek adds, ‘Personally, I should much prefer to have to put up with some such inefficiency than have organised monopoly control my way of life.’ ‘A more vigorous antitrust regime will create winners as well as losers. If done well – admittedly a big if – the result could be a more competitive economy that allows smaller, newer firms a fairer shout against sluggish monopolies.’ The Economist, 12 December 2009. ‘Capitalism calls not only for freedom of enterprise, but for rules and policies that allow for freedom of entry, that facilitate access to financial resources for newcomers, and that maintain a level playing field among competitors.’ Luigi Zingales, loc.cit., 23. Robert E. Litan, ‘Innovation and the World Economy’, the second annual Rocco Martina Lecture on innovation, 4 December 2009.

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Current conservative orthodoxy – ‘all markets are contestable, it is impossible to tell tough from predatory competition, no one can predict the competitive impact of a merger with certainty’ – is nihilism, not economic policy. Worse still, it is bad social policy. It is also an all-or-nothing policy: by never finding a trade practice that impedes the operation of market forces, it invites government to choose between hands-off and hands-on, between preserving competition and then allowing market forces free rein, and, alternatively, directly regulating a market. Governments will most often prefer the latter. 2. Government has a role to play in regulating sectors of the economy where effective competition is not possible. There are far fewer ‘natural monopolies’30 – and it is important to use that term with precision – than we once thought there to be, but some remain: transmission of electric power over long distances, and distribution of natural gas under the streets of major cities are two such that come to mind. In those cases, where competition cannot be relied upon to produce prices that reflect the cost of serving the consumer and to drive innovation, and where entry is impossible or sufficiently difficult to make it an ineffective threat to incumbents during the time frame relevant to policymakers, we need regulation – a system of ‘direct governmental prescription of major aspects of their [the regulated companies’] structure and economic performance’31 that seeks to mimic absent competition. Whether we conservatives like it or not, such direct regulation is at times necessary. Thanks to technology, industries capable of withstanding the howling gales of creative destruction are fewer than ever, but they do exist, often, alas, created by the government. Sooner or later, those areas attract regulation. Yes, there are grey areas, where it is difficult to tell whether regulation is more likely to enhance monopoly power than to control it, the principal ones these days being some segments of the telecommunications industry. And yes, regulation in effect creates a government of men, not laws, as administrators leap to fill the gaps left by legislators too timid to draft bills that clearly define the scope of the regulation they are mandating. And yes, there is a danger that regulation will become a tool used by powerful incumbents to create barriers to entry. Large firms have access to lawyers, 30

31

This is not a term to be used loosely. It refers to ‘a monopoly that arises because a single firm can supply a good or service to an entire market at a smaller cost than could two or more firms.’ N. Gregory Mankiw, Principles of Economics. Thomson Southwestern, third edition, 832. Alfred E. Kahn, The Economics of Regulation Principles and Institutions (Cambridge, MA: The MIT Press, 1988 edition), 3.

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consultants and lobbyists that smaller potential challengers cannot afford. So, the opposition of large incumbents to regulation is often tongue-in-cheek: they know they can win in the hearing and court rooms what small newcomers might win in the marketplace if that were where the battle were joined. And yes, there is always a danger that the regulators will see their task as preserving the financial integrity of entities that should be consigned to the dustbin of history. This is not because regulators are corrupt as that term is usually understood. Rather, the risk is that the regulator sees the regulated entities as clients, to be preserved so that they can continue to render service in the traditional manner, and at traditional costs, give or take a percentage point or two. But no one ever said that policymaking is easy: the main thing is to keep the goal clearly in mind. That goal: competition wherever possible, using the anti-trust laws to prevent anti-competitive practices and mergers that threaten competition; regulation where competition is insufficiently robust and likely to remain so. I suggest that this neo-orthodoxy is preferable to the new conservative orthodoxy of just saying ‘no’ when any regulation of economic activity is proposed. 3. Government has an obligation to see to it that the social costs of private production and consumption decisions are internalized – borne by those who create those costs. That most often means taxing those externalities so that the consumer bears the full cost of his consumption. First, taxation is less susceptible to government failure than is regulation, which builds permanent, self-sustaining bureaucracies. Surely, given the choice, conservatives will prefer pollution taxes that confront consumers with the total cost of their consumption to regulation by bureaucracy, especially if the taxes are made revenue-neutral by reducing taxes on incomes and jobs by a like amount. Better to tax ‘bads’ than ‘goods’ – pollution rather than jobs. Second, conservatives should be the last to countenance consumption or production that imposes private costs on society. That is why taxation of externalities is another example of the uses of neo-orthodoxy. Instead of railing against government regulation and any new taxes – the current conservative orthodoxy – revert to neo-orthodoxy. Identify externalities, measure them as best we can, impose taxes to force internalization of these costs, with a consequent reduction in the magnitude of those costs as prices that fully reflect the costs of production perform their rationing function.

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Once again, making policy to conform with neo-orthodox principles is not easy. Just as there are externalities associated with the problems in the property market – innocent bystanders in Spain, Ireland and America, to mention a few countries afflicted with huge excess capacity, stricken construction industries and banks holding duff IOUs – there are also uninternalized social benefits:32 the purchaser of a home confers benefits not only on him or her self, but also on society. The substantial externalities associated with home ownership include improved school performance, greater civic participation and lower crime rates. These benefits are not fully included by the buyer in the price he is willing to pay. So, the market produces too low a rate of home ownership, justifying government intervention to subsidize home ownership.33 If that is true, then society is indeed well served when government intervenes to subsidize home ownership in a market that undervalues such ownership by failing to internalize the positive externalities associated with home ownership. Surely, the presence of such externalities is the reason extending home ownership has been a long-time goal of conservatives, most recently Margaret Thatcher and George W. Bush. This is not to ignore Judge Richard Posner’s point that some of the negative externalities of home ownership in suburban areas – traffic congestion and carbon emissions, to which I would add reduced labour mobility – must also be factored into any cost: benefit analysis.34 Rather, it is to suggest that conservatives cannot content themselves with indiscriminate attacks on the failed institutions that now dominate the mortgage markets or with attacks on the concept of housing subsidies. These attacks are often somewhere between intellectually slovenly and merely ideological. Instead, we have to decide whether there are indeed externalities, measure them as best we can so that the cost of any subsidies do not wildly exceed their benefits, and develop institutions to distribute those subsidies in an optimal manner. These are empirical questions, worthy of conservatives’ attention. 4. Government intervention is sometimes necessary to offset other instances of market failure. I recognize that attempts to correct market failure often

32

33

34

See Thomas Sowell, Basic Economics: A Citizen’s Guide to the Economy (New York: Basic Books, 2004), 286–8. William B. Shew and Irwin M. Stelzer, ‘GSEs and the Benefits of Home Ownership’, prepared pursuant to a grant from Freddie Mac, mimeo, December 2006. Richard A. Posner, A Failure of Capitalism (Chicago: The University of Chicago Press, 2009), 296.

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result in the even greater damage caused by government failure.35 Market failure is often in the eye of the beholder, and when the beholder is a government official or an American liberal, he or she sees it everywhere as justification for some government expanding, pet programme. Those who would deny patients freedom of choice see market failure in what they call ‘information asymmetry’ – the doctor knows more than the patient. From which it is a short jump to turning treatment decisions over to government bureaucrats rather than to doctors and patients, the doctors not being sensitive to ‘best practice’ and economic considerations, the patients not being wise enough to determine his own trade-off between the pain of treatment and a longer life, on the one hand, and a dignified shuffle off this mortal coil. Or between limping and undergoing the pain of having a new knee or hip installed. But the danger of excessive reliance on market failure arguments and the ubiquity of government failure are reasons for caution, for reluctance to introduce new government programmes, but not an excuse for policy paralysis. The slope might be slippery, but down the road of reform we must travel. The market failure I refer to is the systemic failure created by flawed incentive systems and sub-optimal industry structures. Consider, first the problematic incentive systems that contributed to the threat to the entire financial system, and forced your government and mine to act, not because it was certainly right to do so, but because the risk of doing nothing exceeded the risk of doing something that might in the end prove to have been unnecessary or even harmful. We know that many banks had no incentive to avoid risky loans, since they knew they were ‘too big to fail’. We know that bank executives had incentives to maximize short-term profits, and did so by securitizing the mortgages of homeowners who had little prospect of repaying their loans, on the theory that bundling together a great load of risky paper reduces risk, but more importantly, in the full knowledge that the resultant bonuses are now, and the ruin of purchasers of this paper and those who insured it, comes later. We know that rating agencies, their oligopoly protected by government regulation, and paid by issuers and then only when deals went forward, had incentives to sprinkle the holy water of triple-A ratings on undeserving securities, a form of grade inflation  that would curl the hair even of today’s university administrators. 35

‘. . . The fact that markets are prone to sometimes spectacular failure does not mean that governments are immune to it . . . . The public sector is subjected to all sorts of perverse incentives.’ ‘Leviathan stirs again’, The Economist, 23 January 2010. See also Sowell, op.cit., 300.

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We know, too, that politicians had every incentive to keep the party going, as it is difficult to imagine a social programme that does not please some constituency. All of this results in the socialization of losses while profits remain privatized, leaving us with three choices: the status quo, comprehensive regulation and getting the incentives right. The status quo seems unacceptable. For one thing, voters won’t tolerate it: they have had enough of bankers who have lent imprudently, and then passed the bill to the taxpayer; who created exotic financial instruments they did not understand and that involve so much leverage that at some point the government inherited a load of debt or had to pump equity into troubled banks. It is difficult to deny that bankers’ bonuses have been something more than a reward for skill, hard work and risk-taking as the latter term is ordinarily understood – they have been rewards for winning one-way bets, hardly what conservative free-market enthusiasts should be prepared to defend. For another, the status quo is not an option because the concept of ‘moral hazard’ has leapt from the textbooks to the front pages. This incentive to repeat or emulate past bad behaviour because those who have engaged in it were saved from any negative consequences of their behaviour36 contributed to the collapse of Lehman Brothers, whose CEO felt that what was good enough for bailed-out Bear Stearns was good enough for him – a new entitlement. We will never know whether Dick Fuld, Lehman’s boss, would have accepted an offer to buy and save Lehman Brothers were he not waiting for a Bear Stearns-style bail-out. He didn’t receive an acceptable one, the rescue didn’t arrive and all hell broke loose in financial markets. If we accept that voters will not tolerate a repeat of past remedies, and that moral hazard is more than a theoretical problem, we can move from the option of doing nothing to option two: unleash an army of regulators to regulate behaviour in the hope that day-to-day regulation can offset skewed incentives and a flawed industry structure. In my view, sending a swarm of risk-averse regulators to look over the shoulders and pore over the books of investment bankers, loan officers and others involved in allocating capital is not the way to revive what Keynes called the ‘animal spirits’ that contribute so much to the success of entrepreneurial capitalism. Besides, that detailed audit-based regulation just won’t work in the fast-moving, complicated financial sector, peopled by 36

‘Bailing out failing firms deemed “too big to fail” [creates] an incentive for corporate giantism and financial irresponsibility (which go hand in hand because the difficulty of controlling subordinates grows with the size of an organisation.’ Posner, op.cit., 237.

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executives schooled in gaming whatever regulatory system lawmakers devise. Information asymmetry – the banks have a lot more information than their regulators can possibly have – makes the regulators’ job somewhere between extraordinarily difficult and impossible. Fortunately, there is a third way: the government can put in place incentives designed to elicit behaviour less likely to produce systemic mayhem. Get the incentives right, and much good will follow, and less government interven­ tion – some, but less – will be required. For example, regulators can force bankers to retain a modest stake in any asset-backed securities (bundles of residential mortgages, student loans, auto loans) they repackage and sell on to investors, and not be allowed to hedge against that risk.37 Rating agencies can be required to take a portion of their fees in the securities they rate. A portion of bankers’ compensation can take the form of a long-term stake in the banks’ profitability,38 and bankers’ bonuses can be subjected to clawbacks if the loans they make eventually go sour. All of these means of aligning incentives with socially desirable behaviour create problems of their own, as conservatives rush to point out. But all have advantages over a system that encourages behaviour that can create the enormous costs associated with massive disruption or collapse of the financial system. Instead of complaining about government intrusions in the market place, it would better serve the interests of the preservation of support for capitalism if conservatives would develop and promote methods of getting incentives right. But there is more to market failure than skewed incentives. Since confession is good for the soul, or so I am advised by experts in the area of soul-keeping, we conservatives are obliged to begin with a confession that the system of corporate governance characteristic of the capitalist system is seriously flawed. At minimum it is suboptimal, and at worst a serious failure. The corporate governance system has failed to relate executive rewards to performance, allowing executives on whose watch mighty companies have been laid low to go off to sunlit golf courses with multi-million dollar bonuses in hand. It failed to allocate capital efficiently, putting a premium on size and associated CEO aggrandisement rather than return on capital, encouraging mergers that 37

38

Jennifer Hughes, ‘Lenders face crucial reforms’, Financial Times, 8 April 2010. This would put an end to the ‘originate to distribute’ model. Frederick Tung, Professor of Law and Business at the Emory Law School suggests ‘that bankers be paid in part with their banks’ public subordinated debt securities. Market pricing of this debt will be particularly sensitive to downside risk at the bank.’ ‘Pay for Banker Performance: Structuring Executive Compensation for Risk Regulation’, 13 March 2010. http://ssrn.com/abstract1546229

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reduced rather than enhanced efficiency and caused declines in profitability and the value of shareholder values. It failed to provide equitable treatment of small investors, who are virtually powerless to control the managers of their firms, and whose only recourse very often is to sell at a loss – a problem compounded by the fact that fund-management companies still seem reluctant, although less so than in the past, to use their power to depose directors who approve exorbitant compensation packages.39 The consequences are: a loss of faith in the underlying fairness of the capitalist system and an increase in the cost of capital as investors’ suspicions make them more reluctant to entrust their savings to corporate managers who often ignore their fiduciary obligations. The root of the problem was identified over 70 years ago by Adolf Berle and Gardiner Means – the separation of the control of large corporations from their ownership creates what economists call a principal-agent problem. ‘Under such conditions control may be held by the directors or titular managers who can employ the proxy machinery to become a self-perpetuating body, even though as a group they own but a small fraction of the stock outstanding . . . . The separation of ownership from control produces a condition where the interests of the owner and of ultimate manager may, and often do, diverge . . . ’ .40 This problem was addressed with some success by the Sarbanes-Oxley law, which has gone part of the way to forcing directors to be independent of, rather than chums of a corporation’s managers.41 And by rules to make voting for directors less certain to produce re-election. Both government interventions were opposed by most conservatives, perhaps in the hope, which is not without some support from newly active pension funds, that the principal-agent problem is being addressed by the market, as institutional investors awaken from their long sleep and begin making the power of their massive share holdings felt. That would be a respectable reason for opposition, as would fear that increasing the accountability of directors might result in excessively risk-averse behaviour. But in the present circumstances, those arguments are overwhelmed by the ugly anecdotes of corporate excess. Besides, I suspect that opposition by 39 40

41

‘Critics Say Funds Should Do More to Police Corporate Pay’, The Wall Street Journal, 5 April 2010. Adolf A. Berle and Gardiner C. Means, The Modern Corporation And Private Property. Original published in 1932 by Harcourt, Brace & World, Inc., reproduced by Transaction Publishers in New Brunswick, New Jersey, 2002, 6–7. A comprehensive survey of the literature can be found in Renée B. Adams, Benjamin E. Hermalin, and Michael S. Weisbach, ‘The Role of Directors in Corporate Governance: A Conceptual Framework and Survey’, Journal of Economic Literature, Vol. 48, No. 1, March 2010.

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conservatives has deeper and less rational roots: mention government incursions into the boardrooms and the knees of some conservatives jerk as uncontrollably as do the knees of liberals and libertarians when government incursions into the bedroom are mooted. This principal-agent problem is not only of significance to the shareholders of major corporations, but it also has a macroeconomic effect. In what some have taken to be a mea culpa, former Fed Chairman Alan Greenspan told congress, ‘I made a mistake in presuming that the self-interest of organisations, specifically banks and others, was such that they were best capable of protecting their own shareholders and their equity in the firms.’ That mistake was rooted in Greenspan’s failure to recall the work of Berle and Means – that the financial interests of managers of many banks, pension funds and other financial institutions, at least as they perceived those interests, were not congruent with those of their shareholders. The managers were willing to take risks with the long-term viability of their institutions in pursuit of short-term gains – bonuses.42 In the end, many were wrong, and lost large portions of their own fortunes, although few face penury. But others left ruined or almost-ruined institutions with handsome golden goodbyes, conferred on them by directors whose first priority was not the shareholders whose interests they were elected – actually, de facto appointed by those same CEOs – to protect, but preservation of the reputation for forgiveness that enhanced the prospects of future board appointments. Given the atmosphere created by these failures of governance and manage­ ment, conservatives must balance their antipathy to government intervention against the demonstrated need for reforms. There is no reason for conservatives not to support higher capital requirements for banks, or even some sort of rainyday insurance fund,43 even though that means lower profits, a small price to pay to avoid a repeat of the recent chaos in the financial sector. There is no reason not to support greater consumer protection from banks that think nothing of charging for ‘free’ services, and imposing retroactive increases in interest rates on bank credit cards, even if these reforms drive up interest rates: at least the cost would be transparent to the customer, and full information is surely a conservative goal. There is no reason to oppose measures that make it easier for shareholders to rid themselves of underperforming directors, as greater control of an enterprise by its owners must surely be acceptable to conservatives. 42

43

‘All along the “agency” chain, concern about performance has been translated into focus on shortterm returns’. Stiglitz, op.cit., 13. Beware, of course, of the moral hazard created by such a fund.

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There is no reason for conservatives to oppose efforts to align private and public interests, by reviewing the executive compensation programmes, especially of financial institutions that benefit from government financial support – take the King’s shilling and be the King’s man. There is no reason to oppose regulations that would prevent the likes of Goldman Sachs from urging its customers to buy financial products that it is at the same time shorting for its own account, if charges that it has done so are borne out.44 There is no reason to oppose confining banks that take depositors’ money and have an implicit government guarantee of their continued existence, from risking those deposits with proprietary trading, as Sir John Vickers’ Independent Commission on Banking is proposing. And there is no reason to avoid altering the structure of the banking and finance industries so that financial risk-taking takes place in a sector in which failure is an option, and its costs borne by those who make wrong guesses. 5. Government has an obligation to attempt to make certain that capitalism produces results that are believed by the great bulk of the body politic to be fair, or just, and therefore is sustainable in the long term. The trick is to accomplish this while recognizing that ‘Inequality of wealth and incomes is an essential feature of the market economy’.45 And by keeping in mind John Selden’s warning of more than one hundred years ago: Equity is a roguish thing. For Law we have a measure, know what to trust to; Equity is according to the conscience of him that is Chancellor, and as that is larger or narrower, so is Equity. ’T is all one as if they should make the standard for the measure we call a “foot” a Chancellor’s foot; what an uncertain measure would this be! One Chancellor has a long foot, another a short foot, a third an indifferent foot. ’Tis the same thing in the Chancellor’s conscience.46

So warned, conservatives who want to retain the advantages of a market economy must find some answer to the outrage that has resulted from the current recession and the unequal sharing of its burdens. Otherwise, governments will have a blank check to expand programmes aimed at reducing inequality, rather

44

45

46

See ‘The Financial Crisis Inquiry Report’, Final Report of the National Commission on the Causes of the Financial and Economic Crisis in the United States, January 2011. Ludwig von Mises, ‘Inequality of Wealth and Incomes’, in Economic Freedom and Interventionism: An anthology of Articles and Essays (Indianapolis: Liberty Fund, 1990). The Table Talk of John Selden, edited and with an introduction and notes by Samuel Harvey Reynolds (Oxford: Clarendon Press, 1892), 61.

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than focussing on inequity. Those programmes inevitably will reduce incentives to work and risk-taking more than is necessary to meet reasonable standards of equity. The public believes that Wall Street and the City were saved at the expense of, respectively, Main Street and the man on the Clapham omnibus. The argument that saving the financial system was essential to the health of all participants in the economy just isn’t persuading the mass of the electorate. This is not the place to wade into the welter of statistics on income and wealth inequality: that is best left to competing experts who believe that the issue can be resolved one way or the other by mere data. In my view, conservatives cannot come to grips with those who argue that the capitalist system is producing unacceptable inequality until we understand the effect of the confluence of globalization and the imperfections of the compensation systems of our major corporate and financial institutions.47 Let me explain. Globalization means that some one billion relatively low-paid workers have entered the international labour market. These workers, whose living standards and wage requirements have only now begun to inch up from subsistence levels, compete directly with more highly paid low-skilled workers in developed, capitalist economies, and with some higher-skilled workers who produce everything from automobiles to electronic goods. This new competition threatens the jobs, or at minimum places downward pressure on the wage rates of workers who have played the game we asked them to play – work hard, educate your children, pay taxes. These workers’ only sin is to be in the wrong workplace at the wrong time in the economic history of the world; the plight of such people was of great concern to Adam Smith. No society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable. It is but equity, besides, that they who feed, cloath and lodge the whole body of the people, should have such a share of the produce of their own labour as to be themselves tolerably well fed, cloathed and lodged.48

True, these workers’ plight is due in part to labour-market rigidities imposed by labour unions and by politicians eager to substitute their notions of appropriate

47

48

The following several paragraphs draw on my ‘The New Capitalism’, a pamphlet published in October, 2008 by the Hudson Institute. The Wealth of Nations, 96. See also Amartya Sen, ‘Capitalism Beyond the Crisis’, The New York Review of Books, 25 February 2008, 27: ‘It is also worth mentioning . . . his [Smith’s] . . . overwhelming concern – and worry – about the fate of the poor and the disadvantaged’.

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wages for those that would otherwise prevail in the market, and in part to failures of our educational systems. But equally true is the fact that the flip side of these workers’ problems is enormous benefits to consumers. But where is it written that the interests of consumers take precedence over those of producers, especially when trade patterns are distorted by a communist government’s decision to keep the value of its currency artificially low in order to create jobs in its own country? Meanwhile, the very same globalization that is sapping the bargaining power and the real incomes of some workers is increasing the value of many in the managerial class. A deal-maker can make millions arranging mergers between his domestic clients; he can make hundreds of millions arranging deals across national boundaries. Globalization permits the CEO of an international company to spread his talents over millions more in assets and thousands more employees, and demand to be compensated accordingly. These forces alone explain the emergence of a dissatisfied, hard-put-upon working class and an increasingly affluent managerial and entrepreneurial class in your country and in mine. No matter that these same forces are raising more people out of poverty, more quickly, than at any time in recorded history. That should be unambiguously good news, but regrettably it is not, at least not to workers in the developed economies. As the Chinese masses get richer, as the Indian masses hone the skills that are enabling them to thrive in a high-tech world, they, too, want decent food, and cars instead of bicycles. Add this new demand for food and fuel to existing demand, and prices rise, to the consternation of consumers in already-wealthy countries who previously faced no such competition for resources. And because the response of supply to such demand pressures is far from instantaneous (especially in oil markets dominated by an international cartel and in food markets dominated by politically powerful farmers who restrict output and benefit from artificial price supports), prices rise more than a little. Throw the relatively stagnant real incomes of many workers into the mix, and unhappiness with the way markets are working in the new, globalized world mounts. That pressure on the legitimacy of capitalism is increased by tales of executive compensation unrelated to performance. Americans are not an envious lot: we have always believed that we can get a bigger slice of the pie because the pie will always be bigger. Few begrudge Warren Buffett his billions, earned by shrewd investing. Or Bill Gates his billions, earned by creating a great company that has changed the way the world does business, consumers shop and children play.

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Few even begrudge risk-taking entrepreneurs their billions, despite their rather flamboyant lifestyles – at least not those who risk penury and do not benefit from government support such as preferential access to credit or strange quirks in the income tax system such as those that have enriched some private equity entrepreneurs. But when CEOs manage to wreck the companies over which they preside, and nevertheless depart with millions in bonuses, the results of a market-based, capitalist system of income distribution become increasingly difficult to defend. Never mind that the recent failure of the rising tide to raise the boats of everyday workers might be due to a temporary and unsustainable increase in the premium-accorded skills and education. Somehow, a tide that fails to raise workers’ rowboats, but seems to lift the yachts on which failed CEOs cruise into the future, offends voters’ sense of fairness. The result is that the entire system of income distribution loses its popular support – or at least enough of that support to justify government policies to reorder the distribution of incomes. So much for an explanation of why conservatives, who have long opposed government measures to make incomes more equal – properly so – have to devote efforts to improving the process by which income distribution is determined if they are to head off a further move from equality of opportunity to equality of result. We have to avoid confining ourselves to what James Buchanan calls ‘the piddling trivialities that occupy modern economists’,49 and instead battle to restore the acceptability of the capitalist income distribution system. We can support efforts to remove from the tax system special features (such as deductibility of mortgages on second homes, in America, and treatment of some forms of hedge fund income in both of our countries) that unduly benefit high earners with no net benefit to the overall economy. We can offer empirical support for the notion that when redistribution reduces the incentive of those who produce the wealth that is being redistributed to, I assume, the deserving poor, it is certain to produce more misery than happiness. We can likewise demonstrate that redistribution in some of its forms can create incentives to the antisocial and self-destructive behaviour described by Charles Murray,50 and sap the initiative and dignity of its supposed beneficiaries, and therefore can hardly be defended

49

50

James M. Buchanan, ‘Methods and Morals in Economics’, in What Should Economists Do? Indianapolis: Liberty Fund, 216. Losing Ground: American Social Policy, 1950–1980 (New York: Basic Books, 1984).

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on ethical grounds. Lastly, we can also show that when the cost and complexity of the redistributive mechanisms, such as the UK benefits system, exceeds the understanding of all save (or perhaps including) government bureaucrats, the process is doomed to fail. This is a harder course than merely repeating opposition to government programmes on vague, ideological grounds, but it is necessary if we are not to forfeit the policy-making initiative to redistributionists for whom differences in skill, risk-taking and work effort are irrelevant. There you have it: a neo-orthodox programme drawing on the teachings and analyses conservatives have always favoured, adapted to our present circumstances: ●

●

●

●

●

●●

Vigorous enforcement of competition laws to preserve a dynamic economy and social mobility; Regulation of enterprises with significant monopoly power that is more than transient; Internalization of externalities, using revenue-neutral taxes if necessary; Programmes to correct for other instances of market failure by increasing the power of enterprise owners to control their companies; Creation of incentives for corporate and financial-sector behaviour that align private and public interests and attack the causes of dissatisfaction with the distributional consequences of market capitalism; Restructuring of the financial sector to eliminate one-way betting, and the socialization of losses.

I have no illusions: ●●

●

51

Policies to preserve competition can, in the wrong hands, morph into mindless attacks on successful big businesses and truly pro-competitive practices. Regulation of monopolies where they are inevitable can result in regulatory capture or protection of those monopolies by regulators with a stake in their survival, and worse still, the substitution of the uncertainty of administrative interpretation for what we normally consider the rule of law.51 This problem has not been thoroughly explored in the context of regulation. But it is no minor matter since the industries subject to direct regulation are key infrastructure industries such as energy and telecommunications, and since (at least when it comes to entire economies) existence of the rule of law is an important contributor to economic growth. See Robert J. Barro, Determinants of Economic Growth: A Cross-Country Empirical Study (Cambridge, MA and London: The MIT Press, 1997), espec., 28.

228 ●

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Recognizing externalities and coping with them through taxation or other forms of internalization can open the door to unwise subsidy or tax policies. Recognizing that attempting to deal with market failure can open the door to interventionists who see such failure wherever they look, and to government failure. Restructuring the financial services industry and attempting to improve corporate governance can lead to costly paperwork and risk aversion by corporate leaders. Attempts to create a more equitable capitalism can easily be perverted into programmes for a more equal society Most of all, I am aware that there are always unintended consequences.

But awareness of the problems associated with what I have called neo-orthodox policies cannot be allowed to produce policy paralysis. There is a crying need for a vigorous defence of reformed, market-based capitalism. In part because the recession was brought on by what critics see as ‘financial capitalism’, in part because capitalist countries are seen as nations rattling their begging bowls before cash-rich rulers of centrally directed economies and in part because of the success of China in so far avoiding the worst of the recent upheaval in financial markets, market capitalism no longer captures the imagination of the world’s policymakers, as it did after Margaret Thatcher’s privatization programme brought Britain back from the brink of secular stagnation, and Ronald Reagan’s policies produced ‘Morning in America’ and the collapse of the Soviet Union. Tony Tan, chairman of the Government of Singapore Investment Group, one of the oldest and largest sovereign wealth funds with over $100 billion under management, told a recent gathering of leaders of the financial sector in Davos that Asian and other emerging market countries are reappraising whether they should rely on a ‘system of free markets and minimal regulation, and large dependence on financial institutions and minimum interference from the state . . . . State capitalism, interference by the state, has served [some countries] well’.52 It is up to conservatives to see to it that the performance of market capitalism once again outstrips that of rival forms of economic organization. Let me conclude on a cheery note. In  1835, Tocqueville wrote, ‘The great privilege of the Americans is therefore not only to be more enlightened than 52

‘Asian Banks told to seize unique chance’, Financial Times, 30–31 January 2010.

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others, but to have the ability to make repairable mistakes.’53 We have in the past ‘repaired’ the economic mistakes that brought on the Great Depression by adopting some of the reforms instituted by Franklin Roosevelt, and the cultural mistakes by eventually ending institutionalized racial discrimination, just as Margaret Thatcher ‘repaired’ the failing British economy. It is particularly important that those of us who believe that conservative doctrines, modernized but true to the underlying principles set forth by Adam Smith and others, hold the key to prosperity and freedom, take up the fight against attacks on market capitalism. Unless we correct the recently revealed imperfections, using a coherent set of neo-orthodox principles, we are in serious danger of being unable effectively to oppose massive intervention to eliminate every perceived market failure, and prevent incentive-stifling redistribution. We cannot sit back and wish we were in a world in which bankers are once again loved, regulations are being rolled back and taxes are coming down. R. H. Coase had it right: A better approach would seem to be to start our analysis with a situation approximating that which actually exists, to examine the effects of a proposed policy change and to attempt to decide whether the new situation would be, in total, better than the original one. In this way, conclusions for policy would have some relevance to the actual situation.54

I have tried to suggest such a basis, one that might be applied to a variety of policy issues, as a starting point for discussion, in the hope that we conservatives can avoid the alternative – opposition for the sake of opposition, with no constructive alternatives on offer.

53

54

Alexis de Tocqueville, Democracy in America. Translated and edited by Harvey C. Mansfield and Delba Winthrop (Chicago and London: Chicago University Press, 2000), 216. R. H. Coase, ‘The Problem of Social Cost’, The Journal of Law and Economics, Vol. III, October 1960, 43.

Conclusion – Where Next? Bradley W. Hart and Richard Carr

The Conservative Party has been and will likely remain a decisive force in British politics. To its advocates, it has offered stable, reassuring leadership of the nation at times where liberal or socialist alternative have proved unattractive, incompetent or both. To its critics, it has retarded progressive politics in the UK, divided elements of the voting public (and particularly the working class) against one another and has been responsible for regressive legislation across whole swathes of social and economic policy. Yet, for all the debate, a betting man or woman would clearly have done well to have put any stake on the Tories emerging victorious in a given election over the past century, as this volume has shown. As Stuart Ball has illustrated, Conservatives and the party itself has sought to remain grounded in the practical realities of the day. This is in part because, as Alan Macleod notes, even those loose ideals it does hold have to play out in the sometimes-dirty nature of the political game. Given such flexibility, it is perhaps not surprising that it has been the party of numerous contradictions – and Robert Saunders makes a powerful case for Conservative rhetorical use of ‘democracy’ actually emerging from its opposite: the prospect of, as they saw it, illegitimate action by an executive not possessing a mandate to legislate on Irish Home Rule. Similarly, Steven Howell’s examination of how Conservatives have engaged with local government both ideologically and pragmatically adds a valuable and oft-neglected perspective on the juncture between political ideas and their implementation. The relationship between Conservatives and other parties remains interesting as well. The propensity of both liberalism and the Liberal Party to be subsumed within a Conservative agenda (or coalition) is very much a theme of the past century or so given voice in the chapters by Kieron O’Hara and Chris Wrigley. Whereas Labour’s fundamental belief in the state renders either a formal or ideological coalition between it and the Conservatives unlikely save in times

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of wartime necessity, an understanding between Liberalism and Conservatism goes beyond Clegg and Cameron. Those such as Roy Hattersley who see the divergence between the two main progressive parties – Labour and the Liberal Democrats – as a tragedy to be rectified as soon as possible (the hung Parliament of 2010 representing an opportunity for a ‘new radical dawn’) perhaps have a point, but within the Liberal Party there will be always those of an Orange Book (a 2004 collection of essays written by several Lib Dem ministers in the 2010 government) slant – who, like the Tories, place much faith in the market as societal arbiter.1 John Major’s 2010 speech at Churchill College, which served as the keynote to the conference from which this volume emerged, certainly may speak to such ears.

The state of the party The Conservative Party has often been one where stereotypes have been levelled, not inaccurately, of being elitist, stuffy and out of touch with contemporary Britain. There is certainly something in this – though David Cameron’s attempts to broaden (or de-toxify) the Tory talent pool had some impact. In  2010, 54 per cent of Conservative MPs had been to public school, compared to 64 per cent and 60 per cent in 2001 and 2005 respectively (the UK average being 7%).2 Future analyses of the 2010 coalition negotiations may indeed wish to dwell on the near 40 per cent, including Nick Clegg, of Liberal Democrat MPs who attended similar fee-paying institutions. Clubbiness can die hard. While then, the modern Tory Party is not quite so middle and upper class as in decades past (in the 1950s and 1960s, 7, sometimes 8 in 10 of its MPs had been to public school and a majority of its parliamentary party elected in each election from 1951 to 1974 had been to Oxford or Cambridge universities), it has some way to go to modernize. David Cameron’s much vaunted 2006 ‘A-List’ of candidates – an attempt by Conservative Central Office (prompted by the leader) to advance the prospects of minority candidates – met with mixed success: with women like Louise Mensch winning both a parliamentary seat and political prominence, 1

2

See Hattersley’s article in the Guardian, 11 May 2010. P. Marshall and D. Laws, The Orange Book: Reclaiming Liberalism (London, 2004). Essay titles included ‘Harnessing the market to achieve environmental goals.’ All stats in this section from the House of Commons Research Paper 12/43, 7 August 2012.

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but high-profile black, minority and ethnic (BME) candidates including Shaun Bailey losing out. Less than 4 per cent of Tory MPs in 2010 were from a BME background, with Labour recording some 6 per cent. Both figures represent marginal improvements on recent trends (0% and 3% in  2001, respectively), but still lag behind a BME population of some 8 per cent in 2001, and estimated to approach 20 per cent by 2020. If the Tory Party is to maintain its ‘national’ appeal – which has run through the homely rhetoric of Baldwin to the Union Jack strewn days of Falklands-era Thatcher – it will need to do more here. That surely cannot involve simply parachuting in media-friendly candidates who help to soften the Tory image, but has to see a fundamental re-examination of what modern Britain is, and how Conservatism can make a dynamic contribution to that. It cannot, in other words, involve mere tokenism, but has to involve Conservative governments and the Conservative Party offering further opportunities for women and ethnic minorities to break through the glass ceilings that bedevil British politics. That 90 MPs elected in  2010 came from a political career previously also exacerbates such inertia, and it should also be noted that Labour – partly a result of a long period of office, and thus an accumulation of parliamentary researchers, special advisers and party appointees – contributed more to this figure (52 to 31) than the Conservatives did. Our politics will not change if our politicians do not. After the 2012 Presidential election – where a narrow focus on the older white voter cost Mitt Romney dearly against an opponent, Barack Obama, who won significant support in Latino and African American communities – such a lesson may be of value to American conservatives as well. Some of the anti-Conservative stereotypes, indeed, are actually common across UK politics, and here the Tory Party is almost a victim of its own success. The image of Conservatism being elderly and decrepit is certainly not borne out by a finite analysis of parliamentary cohorts. In 14 of the 16 General Elections held since 1951, the Conservative parliamentary party has been on average younger than its Labour counterpart. Interestingly, even Tony Blair’s New Labour had an average age of 48 for its MPs in 1997, scarcely much lower than the parliamentary Conservative Party (average age of 50) its ruthlessly efficient public relations machine managed to portray as completely out of touch. Explanations for the embarrassing dancing seen in the newsreels of the early hours of 2 May 1997 may lie here. Then again, the performance of the youthful Cameron, Clegg and Osborne after the 2010 General Election might suggest that a bit of experience sometimes goes a long way.

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Gaining office Prior to that election, the public were faced with a choice between Gordon Brown and David Cameron. The Conservatives, rather effectively, suggested Brown’s lengthy (1997–2007) term as Chancellor of the Exchequer denoted responsibility for the worldwide economic slump from 2007/8 onwards. Having presided over an economy where a Labour government was, to quote a threetime minister, ‘intensely relaxed’ over people getting ‘filthy rich’, and where levels of household borrowing had doubled over 10 years, there was something in this, even if it played down the positive effects of the Brownite economy pre 2007/8 – record low levels of long-term unemployment, the introduction of a minimum wage and stable, if varied by sector growth in national GDP.3 Yet if New Labour’s alleged kowtowing to the interests of the City of London was indeed a legitimate criticism, it was disingenuous in the extreme for the Conservative Party to be the ones making it. The then-Shadow Chancellor George Osborne’s stance prior to the crash had been, far from urging him to rein in the City, to criticize Brown for not deregulating the financial sector enough. His reaction to the crash – as Chancellor Darling and Prime Minister Brown swiftly nationalized banks to prevent wider economic contagion – was to hedge, criticizing the government’s handling of the crisis while agreeing with the proposals to prop up the banks. Brown was routinely mocked by Tory MPs in the Commons for a slip of the tongue in late 2008 when he claimed that the British government ‘helped save the world’ with its actions on the crash. He was labelled as negative and unlikeable when offering a gloomy TV debate performance prior to the 2010 election which starkly warned viewers that ‘in eight days time David Cameron could be Prime Minister, supported by Nick Clegg’. Yet, on both, he was not far off. The Cameron-Clegg administration would indeed come to pass, cutting public services and expenditure savagely in an attempt to eliminate Britain’s £167bn deficit in the course of a single parliament. Two years in, they were forced to admit that this would not be possible, and, as late as July 2012, the British economy was producing 0.2 per cent less than it had at the end of Brown’s tenure. Paul Krugman’s 2008 endorsement of Brown – that he had led and the rest of the world had followed in engineering the global economic recovery that was beginning to bed in by May 2010 – which had triggered the phrase 3

Daily Mail, 31 August 2010.

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the then  PM had bastardized to much derision, perhaps began to look more poignant in retrospect. Brown may have cut a rather odd figure on occasions – prior to the 2010 TV debates, he spent hours trying to convince advisers that bizarre comments such as ‘where’s the meat in the pie, David?’ would play well with the public – but his diagnosis of the solution to the crisis, slower deficit reduction and continued public investment to prop up the economy, was proven largely correct after the sober reality of an Osborne-led economy began to bite.4 That there was not a more popular figure in charge was, no doubt, a fault of both Brown himself and his surrounding advisers. But that, once presented with Brown, Cameron and Clegg, the British public voted, in essence, for an administration led by the latter two – the positive Conservative performance in the polls was no secret, and Clegg had more or less pledged to back the larger party – should not be ignored either. Under Cameron and Osborne, a crisis of the market and of the private sector was successfully turned into a crisis of government and the need to cut the public sector. On whatever side of the political divide one sits, that was quite an achievement. For all Tony Blair and Harold Wilson made their own contributions to this field – and early comparisons of them to Clinton and Kennedy sometimes rung a little oddly – it is perhaps in the successful selling of the Conservative message that the Tories have made their most telling impact on the body politic.

Coalition politics In portraying the previous government as incompetent – building, no doubt, on errors it had committed – they opened up a space where committing to roll back the state per se was given something of an electoral mandate. Nick Clegg and Vince Cable had more ambitious plans for public investment – and interesting ideas in their 2010 manifesto surrounding mansion and financial transaction taxes to raise revenue for such spending – but, like every Liberal leader since Lloyd George, they were nowhere close to leading a government on their own. The more laissez-faire aspects of their manifesto were combined with that of their Tory counterparts, and while the Liberal Democrats occasionally kicked up a fuss, they took their place in a government trebling student tuition fees 4

A. Rawnsley, The End of the Party: The Rise and Fall of New Labour (London, 2010), 719. Thanks to Pete Cherns for pointing out this bizarre episode.

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(alienating many of their protest vote supporters in one fell swoop), going much further in privatizing the NHS than Labour’s forays in the late 1990s and early 2000s, and, most painfully, attempting (unsuccessfully) to eliminate the deficit by 2015/16. If British Liberalism has long been divided between social democrats (Lloyd George, Shirley Williams and Charles Kennedy) and those who look more towards the free market (Herbert Samuel, David Laws and Nick Clegg), then even had the Lib Dem tally of 57 of the 2010 election split roughly down the middle between these two groups, this was still enough to give a parliamentary majority to the Coalition. In reality, nearly all the Lib Dem MPs in the 2010 coalition have remained compliant at the time of the writing. The defence of both Coalition partners became pure mathematics. A Conservative government placing much stock on the UK Government’s credit rating with the major agencies needed to evidence that it was stable and could last a full term in office. Lacking a parliamentary majority, this meant some kind of deal with the Lib Dems, or to go back to a country which had deemed it less unattractive than Labour, but not fully deserving of unseating an unpopular Prime Minister. For the Lib Dems, an alliance with Labour and some combination of parties in the Celtic Fringe was scarcely likely to hold for a parliamentary term, notwithstanding the accusations of keeping Labour in office after its having being rejected by the electorate that would have followed. Any attempt to hedge between these extremes, it was often suggested, would have produced a minority Conservative government in the short term to be followed by a sweeping Tory victory in a snap autumn 2010 election. The situation facing Clegg in the days after the election was not easy. However, his decision to join a fully fledged Coalition and extract only minor concessions from his Conservative partners produced the worst of both worlds: assuming the blame for much of what the government did while actually having very little control of the policy process. Possibly that mattered little on a day-to-day basis. The two Lib Dem members of ‘the Quad’ of ministers taking the major decisions over the Coalition’s economic policy – Clegg and Danny Alexander, George Osborne’s immediate deputy at the Treasury – were Orange Book liberals par excellence (Clegg contributing an essay to that publication), and frequent bonhomie in the joint public appearances of Cameron and Clegg suggested an easy working relationship. Occasional briefing from the offices of disgruntled ministers and cries in the wilderness from the Lib Dem left or Tory right were fairly small beer. Despite, or rather because of, negative ratings in the polls, the Tories and Lib Dems appear, at the time of writing, bound together until a 2015 election, or something close to it. Where

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Clegg and his ideological bedfellows end up at that point is difficult to predict. As Chris Wrigley’s chapter in this volume makes clear, however, that election is unlikely to be good news for British Liberalism. Given the precedents outlined in this volume – an ability to roll with the punches of war, armed strife in Northern Ireland, major changes in the consti­ tutional relationship between Britain and Europe, opposition from the trade unions, and others – it is likely that the Conservative Party will be in a better position to respond to the challenges that will arise in the coming years. Whether that constitutes a good thing for the British people is not this volume’s intention to judge. But both Conservative advocates and their opponents may gain much from a reconsideration of the past, and we welcome further debate on some of the enduring themes this volume has explored.

Index Adams, Gerry  102 Addison, Christopher  168 Ahern, Bertie  103 Amery, Leo  109, 111, 116–19, 122–8, 130 Anglo-Irish Agreement (1985)  100–1 Anglo-Irish Treaty (1921)  82, 92 Asquith, Herbert  67, 70, 78, 89, 158, 166 Atkins, Humphrey  98–9 Attlee, Clement  5, 107, 189 Bailey, Shaun  232 Baldwin, Stanley  4, 16, 26, 31, 65, 82, 109, 114, 145, 173, 179–81, 183–4, 189–90, 193, 232 Balfour, Arthur  30, 77, 87, 137, 144, 154, 158 Bevan, Aneurin  182 Beveridge, William  177, 186, 188, 190–2 Beveridge Report  31, 35, 42, 185, 190 Bevin, Ernest  107 ‘Big Bang’, The  57–60 Big Green Society, The  147–8 Big Society  1–2, 133–5, 144, 146, 148, 175 Birch, Nigel  43 Black Minority Ethnic (BME) candidates  232 Blair, Tony  103, 132, 140, 232, 234 Blond, Philip  1 Bloody Sunday (1972)  94–5 Blum, Leon  126–7 Bonar Law, Andrew  66, 69, 76, 78–9, 88–90, 159, 162, 171, 174 Bonham Carter, Violet  155–6 Boothby, Robert  176, 181–2 Braine, Bernard  14 Bretton Woods  43 Briand Plan (1929)  110, 121–2 British Coal  57 British Steel  55 Brown, Gordon  1–2, 148, 206, 233

Burke, Edmund  3–4, 20, 27, 48, 188 Bush, George H. W.  44 Bush, George W.  217 Business rates  138, 140 Butler, R. A. (Rab)  37, 123, 178, 183–9, 191, 193 Butskell(ism)  185 Cable, Vince  1, 8, 234 Cameron, David  1, 83, 132, 141, 143, 145, 154, 174–6, 194, 201, 203, 231–3 Capitalism, outcomes of  223–7 Carington, Peter (Lord Carrington)  ix, 48, 56 Carson, Sir Edward  79, 88–90, 159, 162, 174 Cecil, Lord Hugh  15–16, 69, 77 Cecil, Lord Robert  119 Chamberlain, Austen  74, 85–6, 90, 118 Chamberlain, Joseph  135, 137, 149, 154, 156–7, 174 Chamberlain, Neville  5, 137, 180 Cherns, Pete  234 China  207–8, 212, 228 Church of England  58, 188 Churchill, Sir Winston  5, 65–6, 78, 107, 109, 113, 126–8, 131, 154–6, 159–60, 162, 173, 187 City of London  198, 233 Clegg, Nick  1, 8, 10, 163, 231–6 Clinton, Bill  234 Coalition Agreement (2010)  142 Committee (1922)  36 competition, preservation of  213 constitution (Britain)  34, 65–83 Coudenhove-Kalergi, Richard  108–32 county councils, creation of  135 credit rating (agencies)  207, 235 Croft, Henry Page  159–61, 169 Cromwell, Oliver  77 Curragh Mutiny  89

238

Index

Davies, Clement  155 De Gaulle, Charles  131 Democratic Party (United States)  124, 232 Disraeli, Benjamin  26, 30, 157, 174, 193 Duff Cooper, Alfred  109, 116, 123 Easter Rising  91 Eden, Anthony  5, 35, 124, 182 Einstein, Albert  113 Erskine-Hill, Alexander  36 Europe, British relations with  107–32 European Economic Community  131 European Union (EU)  125, 132 Falklands War  46, 99 fascism  21, 113 Faulkner, Brian  95 financial crisis (2008)  233–4 Freud, Sigmund  114 Friedman, Milton  39, 43–7, 56, 211–12 Gascoyne-Cecil, Robert (Lord Salisbury)  70, 85–7 Geddes Axe, The  168 General Election (UK)  (1892) 156, (1895) 76, 157, (1900) 69, (1906) 68, 87, (1910) 68, 74, 87–8, 161, (1918) 92, 116, 158, 160, 162, (1922) 163, 166, 174, (1923) 37, (1924) 112, (1929) 173, 180, (1931) 145, 172, 180, (1945) 35, 37, 42, 60, 129, 154–5, 176, 192, (1951) 156, (1970) 94, 136, (1974) 97, 138, 153, (1979) 50, 98, (1983) 46, (1992) 101, (1997) 198, 200, (2001) 132, 231, (2005) 104, 231, (2010) 1, 83, 231–5 General Strike (1926)  179 Gilmour, Ian  21, 51, 54 Gladstone, William  85, 161, 174 Glasman, Maurice  133, 148 Good Friday Agreement (1998)  84, 101, 104 Government Communications Headquarters (GCHQ)  57 Greenspan, Alan  222 Grigg, Edward  124, 131

Hague, William  132, 203 Hague Congress (1948)  110, 126, 128, 130 Hailsham, Lord see Hogg, Quintin Hayek, Friedrich  39, 42–4, 178, 188–9, 194 Heath, Edward (Ted)  26, 43–4, 46, 48, 57, 94, 96–7, 101, 131, 136, 143, 153 Henderson, Arthur  118, 173, 180 Heseltine, Michael  48, 52, 136, 149, 156 Hinchingbrooke, Viscount  178, 185–6, 192 Hitler, Adolf  113, 120 Hogg, Quintin (Lord Hailsham)  16, 48, 50, 175–6, 184, 187, 190–1, 194 Home Rule (Ireland) see Ireland House of Lords  27, 70–4, 87–8, 190 Howard, Michael  136 Howe, Geoffrey  199 Huhne, Chris  1 Hurd, Douglas  200 India  33, 212, 225 International Monetary Fund (IMF)  47, 54 International Pan-European Union (PEU)  110, 123, 125 Intervention to correct market failure  217–23 Ireland  6–7, 65–104, 203, 230 Irish National Liberation Army (INLA)  98 Irish Republican Army (IRA)  92, 103 Jenkinson, Robert  1 Joseph, Keith  46, 49, 60–1 Joynson Hicks, William  160 Kennedy, Charles  10, 235 Kessler, Harry  108 Keynes, John Maynard  37, 43, 49, 177–8, 182–3, 189, 192, 194, 207 Keynesianism see Keynes, John Maynard Keyserling, Herman Graf  108 Khaki Election (1900, 1918)  5 Kinnock, Neil  132 Krugman, Paul  233

Index Labour Party  1, 4, 35, 37, 65, 75, 110, 115, 128–30, 132–3, 136, 140, 143, 148–9, 153–5, 160–6, 168–9, 174–9, 182, 184–5, 188–9, 192–4, 199–202, 230–5 Lawson, Nigel  58–60, 199 Layfield Committee  138 Layton, Walter (Lord Layton)  109–11, 129 League of Nations  115, 119 League of Nations Union (LNU)  108–9 Liberal Democrats  1, 146, 149, 154–5, 157, 175, 199, 201–2, 231, 234–5, 237 Liberal Party  30, 35, 66, 68–74, 85–7, 119, 124, 129–30, 153–74, 179, 187, 192, 194, 202, 230–1, 234, 237 liberalism  41–2, 56 Liverpool, Lord see Jenkinson, Robert Lloyd George, David  10, 21, 37, 73, 92, 154, 158–63, 165–6, 169–70, 174, 180, 182, 235 local government  7, 133–50 Local Government Act  (1888) 135, (1972) 136, (1929) 137, (1948) 137, (1958) 138 Localis (think tank)  141 Loder, John  180–2 Loftus, Pierse  30 Lytellton, Oliver  177, 184, 193 MacDonald, Ramsay  110, 131, 153, 172 MacFadyean, Andrew  109, 113, 119–24, 130 Maclean, Donald  168, 172 Macmillan, Harold  5, 37, 43–4, 55, 109, 116, 128, 176, 180–1, 183, 186, 189, 192 Major, Sir John  8, 103, 132–3, 143, 175, 231 Marxism  18, 21–2, 211–12 Maude, Angus  44, 49 Mensch, Louise  231 Miliband, Ed  148 Monetarism see Friedman, Milton Mosley, Oswald  180, 182–3 Mussolini, Benito  113, 117, 182 National Citizenship Service  146 National Health Service (NHS)  1–2, 39, 143

239

Neave, Airey  97–8 New York University (NYU)  125 Nott, John  156 nudge thinking  147 Obama, Barack  232 Orange book liberalism  231 Osborne, George  232, 235 Paisley, Ian  98 Parliament Act  73–4, 78, 81 Parnell, Charles Stewart  85, 87 Peel, Robert  26–7 planning system  142 Poll Tax  139 Powell, Enoch  42–3, 94, 189, 193 Presidential Election (US)  (2012) 232 Prior, Jim  98–9 production, social costs of  216–17 Provisional Irish Republican Army (PIRA)  93, 95, 97 Pym, Francis  46, 57 Rees, Merlyn  107 regulation to ensure competition  216–17 Republican Party (United States)  124 Rhodesia  49 Right to Buy  175 Road to Serfdom, The see Hayek, Friedrich Romney, Mitt  232 Roosevelt, Franklin Delano  124, 229 Rustecki, Dominic  147 Salisbury, Lord  144, 156–7 Samuel, Herbert  172–3, 235 Sandys, Duncan  118, 126 Schacht, Hjalmar  113 Shakespeare, Tom  140 Shakespeare-Simpson-Thomson model  141 Simon, John  154–5 Sinn Féin  92, 98, 100–2, 158 Skelton, Archibald Noel  25, 176 Smith, Adam  41, 209–11, 224, 229 Smith, F. E.  161, 173 socialism  18–19, 22, 73, 127 Soviet Union  46, 49, 111, 127 Stanley, Oliver  176, 180–1, 193

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Index

strikes see unions Sunningdale Agreement  96–7, 100 Tax Increment Financing  1, 148 Thatcher, Margaret  1, 6, 22, 30, 35, 37–61, 65, 97–102, 132–3, 143, 175, 194, 199–200, 206, 208, 217, 228–9, 232 Thatcherism see Thatcher, Margaret think tanks  61, 141 Thomson, Alex  141 Thorneycroft, Peter  43, 193 Troubles, The  93–103 Tyrie, Andrew  193 UK Independence Party (UKIP)  132 Ulster  65–83 Ulster Volunteers  66, 77, 79 Union of Soviet Socialist Republics (USSR) see Soviet Union

Unionism/Unionists  68–9, 81, 86–8, 91–2, 94, 97, 100, 104 unions  54–7, 204 United States  34, 100, 115, 123, 203, 206, 212 Vansittart, Robert  113 Wales  75 Walker, Peter  48 welfare state  24, 177 ‘Wets’  45–50, 98 Whigs (Britain)  2, 85 Whitelaw, William  45, 48, 51–61, 95 Wilson, Harold  43, 66, 84, 93–4, 234 World War I  4, 119, 178, 180, 182 World War II  5, 7, 23, 29, 35, 42, 122–6, 134, 137, 143, 149, 161, 175–92 Younger, George  163

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