‘Entrepreneur in politics’: how many aspirants for power – most recently Silvio Berlusconi, Ross Perot and Michael Heseltine – have traded under that description. On the basis of a successful business record, they have claimed to be equipped to perform startling political feats – cutting through red tape, banging heads together, turning the country round, getting us on the move again. But is business like politics? What can the businessman contribute, and what are his disadvantages? Joseph Chamberlain’s extraordinary career is one good source of answers to those questions.
Peter Marsh’s biography is the fifth substantial one in thirty years, but justifies itself on the grounds that it is the first to cover Chamberlain’s whole career in a single volume and to give adequate weight to his business background. Marsh has sought to be comprehensive and fair-minded, and it has taken him ‘more than a dozen years’ and a third of a million words – not an approach designed to communicate Chamberlain’s presence and panache. But the book has a marvellous story to tell, and an intelligent thesis about the impact of Chamberlain’s business experience on his political practice. Chamberlain was the first man consistently to apply the mentality of a successful industrialist to party organisation and the marketing of policy. He was attuned to the potential of the mass market, the benefits of innovative presentation and the necessity for continuous economic expansion in a way that his landed contemporaries were not. Yet, Marsh concludes, he failed to achieve the ends to which these novelties were means. The book’s message is simple: that Chamberlain’s methods and temperament were a fatal disqualification for achieving the political goals which he desperately sought.
Born into a fairly affluent and hard-headed Unitarian family in 1836, Chamberlain made enough money from screw-manufacturing to retire from it in 1874 with a comfortable annuity. One key to his business success was his aggressive, masterful personality, demonic when threatened or challenged, and motivated largely by resentment at the social dominance of the landed classes. A second was timing: his business prospered in the boom of the 1860s, thanks not least to the Opportunities in Continental markets opened up by the numerous free trade treaties of the first half of the decade. The Franco-Prussian War also helped; then he withdrew, just before a bad depression hit the metallurgical trades in the mid-1870s. A third key was a hunger for expansion, and the vision and marketing skill necessary to feed it. He forced out rivals and created a virtual monopoly by expanding his control over the chain of production, by great attention to the varying needs of his different markets, by efficient discounting arrangements, and by appreciating the benefits of a well-paid, skilled and educated workforce.
Chamberlain’s business career points up the negative and positive attributes that he was to transfer to the political arena. His major shortcoming was his combativeness. He was an entrepreneur, not a manager – indeed, he left business largely because he was bored with it. His mental turmoil and bitterness was exacerbated by the death of two young wives in childbirth, which destroyed the little spiritual comfort that his austere brand of Unitarianism had ever given him. Avowedly puzzled about the purpose of existence, he was driven on by the psychological need to pit himself against all comers. Gentlemen considered Chamberlain’s judgment and character unreliable. Sir Edward Grey called him ‘a dangerous man, because being very masterful, impulsive and sanguine, he always believes he can get through a tight place by pushing’. It was his personality, more than his ideas, which really threatened the traditions of Victorian politics.
On the other hand, he had a wonderful talent for sizing up a situation, for appreciating a market’s changing character and needs, and for exploiting it. Like many other rational, practical Unitarians in provincial centres, he was a keen student of the local social economy; he saw that the future would belong to larger factories such as his own, dependent on and benefiting from an orderly and healthy workforce, and that there was room for a new social politics to respond to this. In common with many large-scale, intelligent employers of his generation, Chamberlain recognised the benefits of persuading labour to co-operate with capital. Workmen’s search for high and stable wages was legitimate; employers should work with trade unions and accept arbitration of disputes, because this would improve factory discipline. Chamberlain granted a nine-hour day in his own business in 1872. Similarly, he saw the importance of raising educational standards; a city-wide system of free education would benefit production, allow business to pay high wages, reduce pauperism and give more men the chance to improve themselves.
His first foray into politics, like all his subsequent ones, vividly displayed both sides of his character. He joined and quickly imposed his personality on the National Education League, an organisation formed in 1869 by Birmingham employers and Dissenting ministers in order to lobby Parliament for local authorities to be made to provide free, unsectarian education. He led the League in a crusade against the 1870 Education Act, criticising its friendliness to the Church and its lack of system. He sought to tap trade-union enthusiasm for the League. Surely, after the great extension of the franchise in 1867, collective power of this sort could be harnessed for mutual benefit in politics as well as business? He adopted a radical perspective – rather than that of fussy middle-class Dissenting moderates – in pushing the League into a policy of limiting rate support to secular education. And he added the union demand for the legalisation of peaceful picketing to his agenda. The result was that middle England, already jittery about the possible consequences of franchise extension, arose in horror at the threat that the League posed to religion, property and order; its by-election campaigns against official Liberal candidates were failures; Chamberlain’s association with secularism and union muscle (and republicanism, for good measure) prevented him from winning a Parliamentary seat at Sheffield in 1874; and the charge of unsoundness by association helped the Liberal Party to its first general election defeat for 33 years. This was hardly a propitious start to Chamberlain’s political career.
Undeterred, he turned to municipal reform in Birmingham. Becoming mayor in 1873, he persuaded ratepayers to agree to buy the local gas companies, so that their profits could fund a proper water supply for the town, yet keep rates low. His other big idea was the massive redevelopment of the city centre, with a view to increasing long-term commercial prospects and so providing money to erect decent housing to replace the appalling slums the development would remove. The benefits took years to materialise. Nonetheless, Chamberlain’s high-profile appeal generated enough cross-class civic pride to allow his organisation to dominate the town’s politics and to form a regional power-base unique in British public life.
This middle and working-class base was an excellent springboard for national politics, into which Chamberlain now dived. He aimed to apply the example of Birmingham to Westminster: to replace propertied effeteness with popularly-backed efficiency. His National Liberal Federation of 1877 was an attempt to harness the potential of large-scale constituency organisation and use it to force an agenda of collective improvement through Parliament. The aim was to increase social solidarity and hence national efficiency, partly by legislative reform for communal benefit and partly by the act of participation itself. Government was to become ‘the organised expression of the wishes and the wants of the people’. Chamberlain’s timing was perfect: at the dawn of urban democracy, awestruck Liberals tended to exaggerate the coherence and purposefulness of the new electorate. His claim to be the interpreter of these voters’ views propelled him into cabinet astonishingly quickly, in 1880, as President of the Board of Trade. He next marketed himself as the best man to communicate with the millions of voters who would be enfranchised in 1885. He threatened to carry all before him, to dictate the future direction of Liberalism.
It all went wrong with terrifying speed, however. His hostility to aristocracy caused his first miscalculation. He thought that the obstacle to implementing his social politics was the Liberal peerage: in fact, it was the self-satisfied middle classes, who had long had more power over the content of Liberalism than Chamberlain recognised, and who quickly became alarmed by his rhetoric and activity. At the Board of Trade, he antagonised laissez-faire shipowners and railway magnates, who in return obstructed his reforms. Then his high-profile speeches at the 1885 election, which talked of property paying ‘ransom’ for its security, and of Church disestablishment, alienated middle-class voters and lost the Liberals their majority. His reputation as the great interpreter of the electorate’s feelings was battered. He had failed to find a workable social programme. Though he toyed with the social issue for the rest of his life, he was never to discover how to rally the nation in the way he had rallied Birmingham.
Chamberlain’s other, worse mistake followed from this stalemate in domestic reform. He had been offered the Board of Trade in 1880 because middle-class conservatism meant he could do little damage there. He soon realised that, if he was to assert himself against the Liberal leadership, he would have to interfere in its special sphere, the government of the Empire, and introduce the notion of mass politics there too. His solution to the problems of Egypt and Ireland was to extend representative institutions. This had the triple merit of annoying the Whigs, adding to his radical reputation, and – he thought – of promoting efficiency, since he genuinely believed that the representative bodies would be dominated by hard-headed local entrepreneurs anxious to defend commercial interests and hence the British connection. Cairo and Cork were to be new Birminghams. But Chamberlain’s interference was unwise. First, it made Irish and Egyptian affairs even more intractable and politically damaging in the early 1880s than they already were. Second, it weakened Chamberlain’s support, because the international scramble for Africa aroused his competitive instincts and alerted him to the need for Imperial defence, thus exposing him to charges of opportunism and betrayal from radicals who had believed he was a Little Englander and nationalist sympathiser. Third, it infuriated Gladstone, who had an arriviste’s loathing for Chamberlain’s ungentlemanly assertiveness and was determined to nip his social politics in the bud. When Chamberlain asked for the Colonies on the formation of the 1886 government, Gladstone retorted witheringly, ‘Oh, a Secretary of State!’ and gave him the Local Government Board instead, cutting his junior’s salary for good measure. When Gladstone introduced his Irish Home Rule scheme. Chamberlain saw it as a personal challenge, which in part it was. Angry at his treatment, and convincing himself that Home Rule would not appeal to the new electors, he impulsively resigned from the Cabinet. Blindly believing in the superiority of new-style mass organisation over the traditional notion of loyalty to the leader, he then played for the highest stakes – and lost. Overestimating his power over the NLF, he thought that his withdrawal of support from Gladstone would force the old man to retract and retire. Instead, Gladstone called an election on Home Rule and rallied most of the Liberal Party behind him. Chamberlain was out in the cold, shunned by most of his erstwhile radical supporters and yoked with the Unionist Whigs whom he had spent the last five years abusing.
There was to be no way back into the Liberal Party, and in any case Chamberlain’s bitter temper forced him into unrelenting opposition to Gladstone. The Liberal Unionists’ alliance with the Conservatives grew progressively stronger. But what an outcome for Chamberlain! Two things were blindingly obvious about his new situation: the notion of a domestic social programme was dead, and he would never be prime minister. He could not become a Conservative in politics or a member of the social élite; required by his new circumstances to endure visits to country houses, he cut an incongruously provincial figure playing tennis in a closely-buttoned black frock-coat and top hat. His priority had to be to keep his core business afloat – to preserve his Midlands power-base. This was a canny move because it suggested that he had a popular following unparalleled elsewhere in the Unionist alliance, and thus was a man to be reckoned with. Paradoxically, though, this meant taking those fussy Dissenters’ scruples seriously and trying to block the most constructive piece of legislation the Unionist Governments ever passed, the 1902 Education Act.
It took Chamberlain nearly a decade after 1886 to find his political feet again, and to realise that there was a greater goal than instilling social solidarity into a city or a nation: instilling it into an empire. German and American competition persuaded him of the urgent necessity of this; as always, Chamberlain was impelled to action by the threat of rivalry. But the Empire card was also politically attractive: it rationalised his opposition to Home Rule; it gave him a real point of contact with grassroots Conservatives; and it offered a better solution to unemployment, by siphoning off surplus labour at home, than any domestic legislation he had thought of. Salisbury, more phlegmatic than Gladstone, allowed him to be Colonial Secretary in 1895. Chamberlain exploited the patriotism kindled by the Diamond Jubilee and the mass media to promote a climate of apparently genuine popular support for Britain’s Imperial mission. And he applied a businessman’s logic to colonial development, arguing for investment in railway construction and applied science.
Once more he went too far. Egged on by Rhodes and Milner, he was confident that Southern Africa could be bound to Britain, that a war to subjugate the Boers could be won without real long-term cost, and that victory might lay foundations for a constructive Imperial policy. He underestimated the strength and feeling Of Boer resistance; the war’s messy progress dealt a severe blow to British self-confidence. Meanwhile, the Treasury had blocked most of his ideas for colonial economic development, while his forays into international diplomacy, advocating an understanding with Germany in order to help keep trade routes open, were snubbed at home and abroad. Once again, the bile rose within Chamberlain. Sharing, in intensified form, the general post-war concern for Imperial security and economic competitiveness, and angered by the continuing complacency at the top of the Conservative Party, he launched ‘one last battle for a united Empire’ in 1903, proposing a scheme of Imperial preference behind tariff walls erected against foreign imports. Britain would take cheap foodstuffs and raw materials from the colonies, which would provide a ready market for her manufactured products.
Chamberlain rushed obsessively into this, with insufficient preparation. Never mind that the City and many businesses (his own included) benefited from the free-trade system; that the mature colonies did not want to be a dumping-ground for British exports; that to impose taxes on non-colonial food imports might well be electoral suicide. The great evil, in Chamberlain’s eyes, was lethargy; the great prize was a living, united empire capable of dominating the world. Victory would make him in reality what he already was in appearance, the first minister of the Empire, leaving Balfour the short straw of the domestic premiership. In 1903, in a pact with Balfour, he willingly resigned from the Cabinet in order that party unity might be preserved at Cabinet level, while he led a crusade for tariff reform in the constituencies. True to his lifelong creed, he planned to win by gaining control of party organisation. The result was an unappealing combination of drift and civil war within Unionism, followed by rout at the 1906 election. Chamberlain then suffered a severe stroke. Having always demanded submission from the womenfolk in his family circle, he was now reduced to dependence on them, asserting himself only by impotent sarcasm about the inadequacies of their cold veal pies. He had kept his children in his masterful shadow; now poor Austen, the eldest, was expected to take up the cudgels for tariff reform. He was a failure. He had the monocle, he had the orchid, but he lacked the dynamism and self-belief. The cause of tariff reform and closer Imperial unity waned; that of Home Rule revived. Chamberlain died in 1914 after eight twilight years, knowing that his life’s work had been undone and – almost as bad – that his political heir had turned into an effete gentleman.
Lord Esher said of Chamberlain that, ‘clever as he is, he has never learnt the self-restraint which everyone learns at a great public school or university.’ This was his Achilles’ heel. Politics requires compromise and a cool head under pressure – one reason aristocrats were good at it. Chamberlain promised to destroy their primacy by asserting superior insight drawn from ‘the real world’, but in fact could not tailor his ideas to circumstances. He claimed to bring efficiency into politics; but he spent more time on presentation than on practical constructive thought. He promised regeneration of each enterprise with which he was associated; but he rarely fulfilled the promise. One may be censorious and argue that his career testifies to the vanity of political ambition, but this is a bank manager’s view, and something must be said on the other side. Chamberlain put on a great show which, wherever he took it, made a very large number of people feel part of a successful community. That, not efficiency and competence in management, is the highest function of the politician. Chamberlain’s presentational skill was the basis of that rare achievement. Perhaps it is here that the entrepreneur can contribute most to politics. Success in this field can excuse many rash moves and the lack of ‘a safe pair of hands’. In its triumphs and failures. Chamberlain’s career is an object lesson for Presidents of the Board of Trade everywhere.