Lord Vaizey sees the light

Geoffrey Hawthorn

  • In Breach of Promise by John Vaizey
    Weidenfeld, 150 pp, £9.95, September 1983, ISBN 0 297 78288 6

Vaizey has no doubt at all. ‘They were the best.’ Hugh Gaitskell, Iain Macleod, Richard Titmuss, Anthony Crosland and Edward Boyle. They were all ‘clever, honest, admirable and honourable’. They were all, except Boyle, who was at school at the time, affected by the slump. They were all excited by the political changes and administrative advances of the war. Four of them entered the Commons soon after. They were all convinced that with Keynes, Beveridge, most of Whitehall, Transport House and even Smith Square behind them, they could do something towards a more decent society. They did not, of course, all always agree. ‘Crap merchant,’ said Crosland to Titmuss at Vaizey’s own wedding. But they were all radicals, and they were all, in Vaizey’s view, wrong. They ‘lacked the power to rethink fundamentally’. That would have required them, ‘perhaps’, ‘to approach questions from the right and not’, as they all did, ‘from the left’.

Perhaps. For what is among many other things unclear in this shoddy little book is exactly where the right is. Vaizey gestures, of course, at the market. He points to something called ‘High Toryism’, from which he thinks Macleod was seduced by craven conciliators at the Ministry of Labour. He alludes to schools, to the virtues of Eton and to the vices of others, like Winchester, which reproduced in Gaitskell its ‘upper-servant mentality’. He even approvingly quotes Oakeshott, on whose ‘boundless and bottomless’ (and exceedingly banal) ‘sea there is neither harbour for shelter nor floor for anchorage, neither starting place nor appointed destination’: the object can only be to whistle familiar ditties and stay afloat. This is plainly mish-mash, scarcely a position. We might wish for a little more than well-schooled rulers spitting and whistling while the crew line up to hew and draw water. But who were these five men? What did they believe? What did they manage to do? And if they had done it better, or done something else, would we now be where we are, in the place in which by the last common consent we would rather not be?

They could scarcely have been more different. Macleod was an organised romantic. He made a profession of cards, fought in France, and used a leave on Lewis to create a constituency association to nominate him for the Western Isles. He eventually reached the House from western Enfield, and when Churchill heard him beat Bevan on the floor with facts, was at once propelled into Health. The two Labour men were disorderly puritans. Gaitskell taught economics at University College in the 1930s, went into the Ministry of Economic Warfare in 1939, followed Hugh Dalton to the Board of Trade, and came out to win South Leeds. He succeeded Attlee and with passionate bad judgment proceeded to divide the party and lose two elections. His delight was to dance to Victor Sylvester. Crosland fought in the Mediterranean, decided to be the new Eduard Bernstein, returned to Oxford to finish his degree, taught economics too for a time and was elected from South Gloucestershire in 1950. He published The Future of Socialism in 1956, was elected from Grimsby in 1959, and worked an increasingly rebarbative and lonely way through Education, Trade and Local Government. In 1974 he was given Environment and, later, the Foreign Office. His delights were more racy than Gaitskell’s. But he kept them more effectively apart from his politics.

Boyle and Titmuss were different again, like each other only, if at all, in being altogether more mystical and restrained. Boyle, Vaizey relates at embarrassing length, was a baronet with means who had been to Eton. Titmuss sold insurance at the door and had left his elementary school almost as soon as he could. Boyle seems almost to have backed into politics: once there, and especially at Education, was at odds with the larger part of his party. He was a bachelor and an insomniac, read widely, liked late romantic French music, and eventually resigned to be vice-chancellor at Leeds. He, alone of the five, was always convinced that he had nothing to say. He even wrote six Reith Lectures and then withdrew them. Titmuss did have something to say, and knew it, but he never went into politics at all. He was commissioned by Hancock to write the official history of social policy during the war, and as soon as this appeared, in 1950, the one lively volume in a very dull set, he was given the new chair in the new subject of social administration at the LSE. There, he trained staff for the state services and from his smoky height, pressed the view that housing, health, education and certain sorts of insurance should be conferred as rights and not given a price. In private he was domestic, in what Vaizey calls ‘the better end’ of Acton.

If these five men, as Vaizey claims, had ‘shaped a generation’, the generation would have had no shape at all. It shaped them. The 1930s had convinced almost everyone that high unemployment and no insurance against it could not again be allowed: Gaitskell was persuaded by the Swedish economists, Ohlin and Lindahl, that the state itself should invest to raise output and so stimulate further investment. He was also swayed by a version of Lerner’s rule and by his friend Evan Durbin. If assets were more evenly spread, there would be more private demand, firms would adjust their output to it, and we could have socialism without undue direction. After the war, he in stead accepted what had come to be thought of as Keynesianism and assumed, as Macleod, Crosland, Boyle and even the Treasury were later to do, that government spending (if not, as Keynes himself had optimistically thought, lower taxation too) could raise demand and output without undue inflation. But in between, he had worked in Whitehall.

This experience was decisive, for Gaitskell, for others, and above all for the larger part of the post-war Civil Service. Although Britain did not win the war, it came out on the winning side, and to try to make it do so, the Government had instituted an unparalleled degree of direction. In rationing, it even created a workable new currency. Only the Japanese, who had started such policies in the 1920s, had ever managed anything like it. But no one knew that in 1945, or at least no one cared to, and it was Britain which impressed. It impressed the new internationalists, who were advised by our economists to plan new economies. It certainly impressed those, like Gaitskell, who had managed it. It was, as Vaizey might say, Winchester’s finest hour. It seemed natural to prolong it into the peace.

Meanwhile, Beveridge, understandably impressed by the Soviet example, had proposed a practicable scheme of social insurance. Before the war was over, the coalition government had produced Education and Family Allowance Acts, and Attlee’s went on to produce some more. Titmuss’s history confirmed the conviction that what had in the war itself been an unlegislated and indeed wildly improvised set of remarkably co-ordinated services had kept the country going. He thus justified what Lord Woolton had begun in the Reconstruction Committee, what Butler and Bevan and others had done, and with the popular support that all this had, he helped persuade politicians that the provisions should be secured and even extended.

Gaitskell and Crosland, the radical rationalists, were very actively convinced. The Future of Socialism made that clear. It also pointed to some of the difficulties: Vaizey, who has since abandoned such convictions himself and is made forgetful by righteous vanity, does not concede as much. Macleod, ambitious, realistic, and briefed by Woolton’s Conservative Research Department, just accepted. By the time that Boyle went to the Treasury as Economic Secretary in 1955, it was the going wisdom. The Economist called it the Butskellite consensus. To different degrees, and after very various amounts of reflection, all five men did believe that it was possible to manage the economy and improve the society. But in this, suggests Vaizey, they all expected too much. This is not what politics is for.

They certainly had their problems. As Chancellor, Gaitskell instituted a ludicrous plan for defence and decided to pay for it by charging for prescriptions. Churchill cancelled the plan within the year but Gaitskell had divided his party for ten. That was almost certainly not necessary. It took Wilson and Marcia Falkender to put it, for a time, together again. At Health, Macleod was a success, too much so for Vaizey’s taste, because he let dental assistants scale teeth, built more hospitals, and secured acceptance for the Guillebaud Report. In this, Brian Abel-Smith, one of Tit-muss’s protégés from the LSE, had recommended that budgetary control of spending be replaced by the ratchet of national income accounting. But at the Colonial Office, Macleod had to push through majority rule for several new African states. He angered the whites and the Marquis of Salisbury, who stood up in the Lords and called him too clever by half. Relief at home at this time was intermittent, Vaizey reports, since poor Mrs Macleod had to cook for the ‘cannibals’. Nevertheless, Macleod was the most successful of the four politicians. Boyle and Crosland both gathered ill-will at Education, trying to effect the re-organisation of the secondary schools. Crosland did some characteristically clever and constructive work on housing at Environment, which Vaizey does not mention, but he was denied the Treasury, which he wanted, and died in the Foreign Office, which he hated. These were all the ordinary fortunes of power in broadly-based parties. If any of these men expected too much of politics, they did not show it. And to say that they were all doctrinaire social democrats, dazzled by the dogmas of social science, is silly. They believed in good briefing, hard work and piecemeal reform. They were precisely the pragmatists that Vaizey thinks they should have been.

Nevertheless, one does not have to have been at Eton or Winchester or even a not-so-smart school like Fettes to see that they, and the generation they shaped, have brought things now to a pretty pass. One just has to read what Vaizey says. The working class may once have been warm and wonderful, but council estates are now full of ‘yobbos’. New hospitals are ‘white elephants’. Public education ‘institutionalises ignorance’. Trade unionists are ‘bibulous’. There has of course been the Falklands. ‘At last’, although as this book appears the time is fast receding, ‘we can hold our heads up.’ But we could have done better and done so much sooner.

We could have seen that the upswing in the Western economies from the early 1940s to the late 1960s was yet another mysterious Kondratieff wave. We could have sensed the presence of North Sea oil and not worried about ‘the difficulties of the occasional British deficit’. We need never have intervened in the economy at all. Yet we should also have had an incomes policy much sooner than we tried to do, we should have raised the status of business, and we should have stamped on seditious shop stewards. We should have had an investment policy as well, although even Vaizey sees that in a period of fast technical change and shifting trade, we might not have known quite what it could be. With such prescience and unprecedented power we could, just, have recovered. This, one infers, is what politics is for.

Even as hindsight, let alone on Vaizey’s own premises, this is clearly incoherent. It implies at least two quite opposed possibilities. The first is a kind of Keynesianism, but pace Vaizey, a Keynesianism more thoroughgoing, more doctrinaire, in some ways much closer to the source, than anything tried here in the post-war years. This accepts the need for some restraint on incomes and for directed investment too. But it sees that if the restraint is to work and the investment to pay, assets may have to be redistributed, taxation lowered, protection imposed, and the City of London given a brisk farewell. It is what is now being proposed for the Labour Left. It is what can be described as the course to North Korea. There, it works wonderfully, not least because the Koreans themselves do. It does, of course, have its own horrible history. It also has its political price. It cannot be what Vaizey would have liked.

The other possibility is an economy with no name, and once again much tougher than we have yet seen. This insists on the benefits of freed exchange but accepts that costs have to be curtailed. Yet because it also accepts that most costs cannot be, and because it knows that money cannot for ever be kept tight, it turns in the end to earnings. Earners cannot be allowed to bargain in the market, and so have to be restrained, if necessary by force. It is what Chicago proposed to Chile, and there, at least, it has been a complete disaster. The Chileans have paid their price for nothing. Yet it might be what Vaizey has in mind.

It is certainly consistent with what he says. Whether it really is what he has in mind is more difficult to say, if only because there is so little evidence that he has anything left in his mind at all. In any event, he might agree that each of the two extremes is too extreme, that no one has yet devised a practicable alternative, that even Macleod would not have bet on the date of the next Kondratieff wave, and that we are by default returned to muddling through. The difference merely is that whereas Vaizey, like the present government, muddles through with vapid and vicious nostrums, the men he so hollowly mourns did so with decency and attention to the facts.