Why the Tories Lost

The Conservative defeat in this year’s general election is probably the worst suffered by any party since 1931. (The comparison with 1832 is meaningless. The only reliable comparisons are those with elections held under universal suffrage, of which the first was 1929.) Labour, it is true, had a lower proportion of the votes in 1983 and 1987 but on both occasions won significantly more seats. In 1935 Labour won in proportion only a few more seats but had a much larger percentage of the poll. This year the difference between the two parties’ performances was extraordinary. Three hundred and thirteen Labour MPs were elected with more than 50 per cent of the votes cast in their constituencies, 44 (including Tony Blair and John Prescott) were elected with over 70 per cent, and two with over 80 per cent. By contrast, only 14 Conservatives won more than 50 per cent of the votes cast. The most successful Conservative, John Major in Huntingdon, received 55.3 per cent of the vote: the most successful Labour candidate, Mr Benton in Bootle, 82.8 per cent. What is striking is how few MPs from the Conservative heartlands in the suburbanised county constituencies of the South and East Anglia were able to win 50 per cent of the vote.

It has been usual to compare this result with 1945, but the two are not all that similar. Labour probably did better than in 1945 and the Conservatives certainly did worse. Labour won proportionately more seats in 1997 than in 1945 and its lead in votes was larger: in 1945 it was 8.5 per cent ahead of the Conservatives; this year nearly 13 per cent. It did not win as high a proportion of the vote as in 1945, but that is probably misleading. A better index is the size of Labour’s ‘preferred’ vote: what percentage of the voters would vote Labour if they were all required to choose between the Conservative and Labour Parties alone. There must be considerable guesswork in estimating this figure, particularly as many people would probably not wish to choose between the two parties. But if they did, it is likely that about 54.5 per cent of the population would have voted Labour in 1945, and about 56 per cent (or more) in 1997. The 1997 figure has no equal in Labour’s history. There are, moreover, some important differences in the configuration of the Labour vote. In 1945, for example, Labour’s weakest performances in urban Britain were in Greater Liverpool and Greater Glasgow, because sectarianism was still a dynamic element in their politics. In 1997 Labour’s strongest performances in urban Britain were in Greater Liverpool and Greater Glasgow, largely because sectarianism had ceased to be dynamic. And this change is not confined to the working class: everyone in these conurbations is more inclined to vote Labour. There is no evidence that the fall in turnout harmed the Conservatives more than Labour, though it pointed to a wider political disengagement, particularly in safe Labour seats, which the present electoral system does nothing to mitigate.

The extent of the Conservative defeat is unambiguous. They won 48 fewer seats than in 1945 (though, in effect, more than 48, since the 1945 Commons was slightly smaller than the present one) and 8 per cent less of the total vote. There are two reasons for this, apart from the overall swing to Labour. The first is the success of the Liberal Democrats in England. In 1945 its predecessor, the old Liberal Party, won only six seats in England and only 12 altogether – the remainder were in Wales. This year, however, the Liberal Democrats won 34 seats in England; all, with one exception, at the expense of the Conservatives. Furthermore, in 1945 the Liberals and their electorate tended to be more sympathetic to the Conservatives than to Labour. This year the reverse was true. The second reason is the collapse of the Conservatives in Celtic Britain. In 1945, difficult though it is to believe, the Conservatives and their allies won 30 seats in Scotland, four in Wales and eight in Northern Ireland. This year the Conservatives won no seats in Scotland and Wales and they have long since parted company with the Ulster Unionists. The Liberal Democrats and the Celtic fringe thus turned what would in any case have been a heavy defeat into a debacle.

One thing the two elections have in common, however, is that their results were both unexpected. Hardly anyone thought Labour would win in 1945, and while many thought Labour would win this year, hardly anyone predicted (at least publicly) the landslide, though in both cases everything we knew pointed to that outcome. Every opinion poll, every local government election, every Euro-election, every Parliamentary by-election indicated this year’s result. And not just the overall result: they exactly prefigured where the swing to Labour would be greatest, even those constituencies, like Bristol West (William Waldegrave’s seat), where Labour would come from third place to win. Why were we so ready to discount this overwhelming weight of evidence? The obvious answer is 1992 – once bitten twice shy. That is a good reason; but there are, I think, two better ones. The first is that the ‘idea’ which lies behind Thatcherite and post-Thatcherite Conservatism has triumphed. It is not merely the triumph of the market. The way we think about and describe the world, the vocabulary we use, particularly in public life, has been transformed in the last twenty years. This vocabulary might be self-parodying or absurd – and often is – but it now has no competitor. It has thus been difficult for us even to imagine that the political vehicle of this victorious ideology – precisely because of its victory – could itself be defeated. It is here that 1997 differs most from 1945. Although people were surprised by Labour’s win in 1945, they knew that the ‘idea’ with which Labour was most associated had already won: the election simply brought Parliament into line with the mood of the country. In 1997 we can apparently rely on no such explanation.

The second reason is that the Conservative Party was never meant to be defeated. No other party in recent British history has worked so hard to ensure that it created a political system which could not be overturned. The colossal edifice created over the last 18 years was designed to exclude all political competition – partly by persuading people that no other party was legitimate or competent to govern, and partly by restructuring the electorate and the system of government so as to exclude the competition. Most of us were aware of this system and the way it operated – the 1992 election was a spectacular example – and were right to be impressed by it. Less obvious, however, was the instability which finally brought it down on 1 May.

The Conservative defeat was the result not of the ERM fiasco – that was merely the occasion – but of longer-term tensions within both the Party’s ideology and the country’s political system which in the end ground its hegemony to bits. When Mrs Thatcher came to power in 1979 she was an old-fashioned deflationist; her ‘monetarism’ had no theoretical basis but served only to justify low levels of government expenditure. Furthermore, the deflationary rhetoric – cut taxes, promote ‘real’ jobs, curb unions, eliminate waste, encourage thrift and hard work – was an essential element of her kind of Conservatism. Mrs Thatcher not only believed it, she assumed that the electorate did so as well. The first years of her government were based, therefore, on the assumption that a deflationary rhetoric and accompanying policies would by themselves mobilise the electorate. This was not the case. It is often said as an example of Mrs Thatcher’s ‘courage’ that she was prepared to risk unpopularity, even lose an election, to preserve her principles. She would have been an odd sort of politician were it so. She was determined to win, but her government found that the only way it could make deflationary Conservatism acceptable to the electorate was to encourage an increasingly inflationary boom. This was Thatcher’s First Paradox: her government had to follow policies which were simultaneously deflationary and inflationary. More than anything else it was this paradox which drove Thatcherite Conservatism as a political system off the rails.

Such a fundamental political contradiction could not but undermine the Government’s overall consistency of purpose. But the same was true at the level of rhetoric. Rhetorically, Mrs Thatcher and her ministers could not decide whether Conservatism should be ‘productionist’ or ‘consumptionist’. At its outset, the Government was ‘productionist’, as it was deflationary. The aim of policy was to rehabilitate the British economy, particularly its manufacturing sector. That was to be done by the old-fashioned virtues: saving, hard work, a restoration of managerial authority, a recognition that you cannot have something for nothing. But the old-fashioned virtues went the same way as deflation, and for the same reason: they were not very popular. The Government’s recourse was a ‘consumptionist’ boom made possible for a time by the receipts from North Sea oil. This was the Second Paradox: a ‘productionist’ rhetoric was made acceptable to the electorate by a consumption boom which violated all the old-fashioned virtues. So long as you were in the right place at the right time, you could have whatever you wanted with a minimum of effort – which is how most of us will remember the Eighties. In practice, moreover, it was easier to encourage consumption than the old-fashioned virtues, and the notion of citizen as consumer fitted well with an ideology which attempted to depoliticise politics and transform the existing relation between the citizen and society: the citizen was to become a client, a customer, a purchaser – everything but a citizen. Even so, the boom of the late Eighties which Nigel Lawson let rip (and which was once called an economic miracle) was defended on ‘productionist’ grounds, though only one thing was clear about the boom: that the British economy, far from being transformed, did not have the productive capacity to sustain it.

The two paradoxes had two ‘solutions’: the first was the recession of 1990-3, from which neither the Conservative Party nor the electorate has yet recovered; the second was the fatal decision to enter the ERM at the highest rate against the mark. This decision tells us much about the nature of Mrs Thatcher’s leadership of the Conservative Party. Her political instincts warned her that in directing such a fragile instrument as the British economy the Government needed full freedom of manoeuvre. But she was also a deflationist and the object of entering the ERM at the rate of 2.95 marks to the pound was undoubtedly deflationary. More important, the notion that membership of the ERM would show that we were ‘serious’ about inflation was held by preponderant opinion in the Conservative Party, the Treasury, the City and the press. Whatever she thought privately, there was no question of her being able to resist. The whole episode suggests that Mrs Thatcher’s authority was always exaggerated. She remained leader of the Party so long as her leadership was acceptable to the institutions and opinions which matter in the Conservative Party. When her leadership became unacceptable, because too risky, she was removed.

Sterling’s brief membership of the ERM was undoubtedly a disaster for the Conservative Party, not only because the pound was humiliatingly driven out, but because no one, not a minister, not a civil servant, not an ‘adviser’, accepted responsibility for what had happened. Protecting the system was now what mattered most: to resign would be to admit error, and that would reflect badly on the system. This was not forgotten by the electorate: witness Norman Lamont’s fate at the hands of the vengeful tactical voters of Harrogate. A hard fate perhaps, since he was one of those least keen on the ERM and one of those most happy when we left. It is only a pity that he spent such a sizable proportion of the national treasure trying to keep us in. The ERM affair had one other obvious consequence: it almost obliterated the widely-held view that the Conservative Party was ‘competent’ in a way other parties were not. This, in itself, might have been retrievable had it not been for the extent to which the Conservative hegemony was further undermined by three other irreparable contradictions in policy, similar to those which took us in and out of the ERM.

The first was privatisation. There was a strong ‘efficiency’ argument for privatisation and a number of the state-owned concerns were unquestionably ripe for private ownership. Many members of the Government, not least Mrs Thatcher and her successor, believed in privatisation on ideological grounds and the argument of efficiency was the one they most often employed. Had this been the only argument they employed, privatisation might not have had such malign consequences for them. Unfortunately, they also believed that privatisation was a way of attaching ever larger proportions of the electorate to the Conservative Party. So was born that craze of the Eighties, ‘popular capitalism’. Popular capitalism was to be to the Conservatives as council housing was to Labour. It was to establish a huge clientele wedded to the Conservative Party by its ownership of shares in privatised state assets. To ensure that the clients purchased shares these assets were often underpriced and, in fact, shareholders lost as citizens and taxpayers as much as they gained as shareholders. But that was not a calculation most popular capitalists were expected to make. Furthermore, shareholding was to effect an intellectual conversion: to make people instinctively anti-socialist and hostile to the Labour Party.

In the long term, though probably not in the short, the attempt to create a popular capitalism failed. For one thing, popular capitalism and dynamic capitalism are almost antithetical. You cannot have both, though the Government would not admit it. For another, most people sold their shares almost immediately, with the result that the number of individual shareholders is today scarcely higher than it was in 1979. The real beneficiaries of privatisation have been the large institutions like pension funds – and their managers, though immensely powerful, do not have many votes. What developed was a ‘culture of privatisation’ which the Government largely created but in the end could not curb. Its most obvious manifestation was a general climate of enrichissezvous which affected much of the population but which in particular involved huge transfers to the bankers, lawyers, consultants and ‘advisers’ who handled the privatisation programmes. Significant elements of the British upper middle class not only did extraordinarily well out of privatisation: they had an interest in continuing privatisation. These transfers actually represented large payments by the taxpayer (to the extent that taxpayers were the original ‘owners’ of the privatised assets), though it was some time before this was understood.

Privatisation on this scale, something no other country has attempted, swept up the Government and the country’s senior managerial classes into a kind of euphoria. Not only were top marginal tax rates reduced to what were, by our standards, unimaginably low levels; all the customary constraints on executive pay were abandoned, with the directors of the newly-privatised industries in the van. There is no doubt that this behaviour was deeply offensive to much of the electorate, even to those who had been a little euphoric themselves. It was partly that, as time went on, they were antagonised by changes in the distribution of taxation which markedly disfavoured them; even more perhaps, a strong distaste developed for the money-grubbing of the country’s economic élites – a sense of money not being earned, of people helping themselves to public assets. It seems clear that to many the last stages of Conservative government must have seemed, as was said of Napoleon III’s rule, not so much a regime as a racket. Major was genuinely dismayed at the behaviour of the boardrooms, but by now the Conservatives were in no position to stop it.

This did them great harm. We have long known that working-class Conservative voters – traditionally the Party’s largest single constituency – have reasoned not just that the Conservatives were more fit to govern than anyone else but that they were more willing to guarantee ‘fairness’. Unlike the Labour Party, which promoted vested interests (such as trade unions) at the expense of the wider community, the Conservatives stood for balance – they held the ring to ensure that no one interest became dominant. This was no doubt a naive view, but plausible; and historically the Conservatives have been careful to ensure that it remained plausible. After 1979, however, they could not and did not do so. ‘Fairness’ was part of the system they repudiated, since ‘fairness’, a pre-occupation with the distribution of wealth rather than its accumulation, was one of those things which had brought Britain to its knees. As a result, the Thatcher and Major Governments were increasingly seen, even by the most naive, as ‘unfair’. Just as the Left of the Labour Party in the early Eighties insisted on jettisoning those Labour traditions most acceptable to the electorate, so the Conservatives abandoned that prudence which was essential to their electoral success.

The 1997 election was the first in which the consequences of privatisation had become fully apparent. In 1992 the behaviour of the bosses of the privatised utilities and of the boardrooms more generally was not really an issue. Nor were the failings of the utilities. In the last five years, however, their failings have, if anything, been exaggerated in the public mind. In the old days people did not expect all that much from them because their managers received, so to speak, pay appropriate to the job. Today, when their operations are almost certainly more efficient, their peccadilloes are magnified in proportion to the incomes of their senior managers. Nor in 1992 was ‘sleaze’ among politicians much of an issue – the word was rarely used. This year it was an issue even though the received wisdom during the campaign was that the electorate was not much moved. But the electorate clearly was very much moved, and it is a measure of the isolation of the country’s political leaders that they did not see it.

The second of these contradictions was rhetorical and ideological. The ultimate ambition of Thatcherism was the restoration of authority to the country’s sovereign institutions – which in practice meant the Cabinet and the central bureaucracy. Its impulse was therefore authoritarian and anti-democratic. But Mrs Thatcher was unwilling to put it in those terms. Just as she was obliged to legitimate deflation by inflation, so she felt it necessary to justify authoritarian government by the rhetoric of ‘openness’ and ‘accountability’. She never intended, of course, that openness was to apply to the executive – quite the reverse. Openness and accountability were to be imposed on things she did not like. It was inevitable, however, that the Government and the Conservative Party would eventually be judged by the same criteria since Conservative leaders had never and could never publicly exempt the central government from what were supposed to be universal norms. Major got the worst of both worlds: he was unable to surround the doings of his Party with secrecy but got no credit for openness since his heart was seemingly not in it. The Government’s behaviour towards the Scott Report was the best but not the only example of this.

At the centre of the Thatcher-Major Conservative Party’s ideology lay a profound ambiguity of purpose which in retrospect will probably seem its most interesting feature. One powerful impulse behind Thatcherism was the notion of the new start. The old social system with its carefully graded hierarchies and political reticence, its apparent reluctance to disturb vested interests, its overall ‘wetness’, was held to have failed the country and demeaned its status in the world. This gave Thatcherism a distinctly critical edge, a willingness to think and say radical things about our existing social arrangements. Mrs Thatcher, after all, described what she was doing as a ‘revolution’. For some, the revolution excited hopes of a thoroughgoing democratic reconstruction. But Thatcherism was also genuinely reactionary: it wished to restore legitimacy to the old hierarchies. Mrs Thatcher was herself hostile to many of the democratic changes that had occurred in her lifetime – largely because they were associated with ‘socialism’. She thus created three hereditary peers (though only one had a male heir) and would, one suspects, have created more had she had the nerve; she and her successor were adamant in their defence of the hereditary House of Lords; the first act of the classless John Major was to bestow a baronetcy on Denis Thatcher, a title most people had forgotten existed; both scattered political knighthoods around with profusion, and not just to keep the backbenchers docile; the Thatcherite Conservative Party has been exceptionally reluctant to curb the privileges of the Royal Family; they have done all they could to prop up the independent schools and denigrate the state sector; they reversed the Conservatives’ flirtation with Scottish devolution and defended the Union to the point of lunacy. By adopting the rhetoric of revolution and the new start Thatcher and Major thus did grave damage to the system they inherited and wished to restore, and incidentally did much to promote a democratic politics. Yet because their ambitions were fundamentally reactionary they were inevitably unable to exploit them. The unintended beneficiaries were Tony Blair and Paddy Ashdown. Yet again the Conservatives had the worst of both worlds.

What Thatcher and (especially) Major wanted to establish was a modernising democracy based on a mobile and meritocratic middle class who would provide the Conservative Party with an unassailable social base. They failed, as their predecessors in the Thirties and Fifties who wanted the same had failed, because their chosen instrument, the Conservative Party, was remarkably unsuited to the task, and because, in the end, their fear and dislike of ‘socialism’ and a politicised working class much exceeded their contempt for the traditional ruling class. The result was that the Conservative Party could only promote a mutilated form of democracy and the field was left to the Labour Party. Whether Labour can rise to the occasion is an unanswerable question.

The third contradiction was in economic policy. One of the basic assumptions of Thatcherism was that the British managerial classes could be freed from artificially imposed constraints and so restored to international competitiveness. The miracle was seen as coming from within ourselves. There were some improvements but the overall outcome was undoubtedly disappointing: much of the managerial class, it turned out, was inherently uncompetitive. The Government was therefore increasingly inclined to put its wager on inward investment: success came to be measured by the quantity of overseas investment in Britain. And this investment was thought to depend on ‘flexible’ labour markets and low labour costs. The pervasive sense of insecurity that was obviously a factor in the fall of the Conservative Government was one result, a sense which turned to anger when it became plain that low labour costs stopped at the boardroom. Nor did the Conservatives reflect on the curious evolution of their original endeavour. When Mrs Thatcher took office her aim was to transform Britain against the rest of the world: when Mr Major left it the most avowed achievement of his government was to provide cheap labour for foreign businessmen.

How far changes in the Labour Party assisted the Conservative collapse is hard to assess. Obviously a Labour Party of 1983 vintage was unacceptable to the electorate. Here the role of Neil Kinnock is crucial. He could talk the language of the Left and so was able to make the Party see sense. He also rescued the Party electorally at a moment when it might have ceded its second place to the old Alliance. By 1992 Labour had largely recovered the ground lost since 1979, though Kinnock never got much credit for this. Labour owes one other debt to him: he lost the 1992 election – one of the few pieces of genuine good luck the Labour Party has ever had. Tony Blair’s part is open to several interpretations. One is that he was the icing on the cake, that he reduced to zero the apparent risks of voting Labour. There is truth in this, but it is not the whole truth. His personality and manner were clearly attractive to people, and that mobilised some voters who were attracted neither by Kinnock nor by John Smith. Possibly more important, however, was New Labour’s attraction for women voters. Not widely noticed, except by the Labour Party, was the most remarkable feature of the election: that the proportion of women who voted Labour was almost identical to that of men. The importance of this to Labour cannot be exaggerated. Historically, Labour has been much less successful than the Conservatives in mobilising women voters; and the Conservatives have been more successful in mobilising women than Labour has been in mobilising men. The reason for the Conservatives’ success after 1951, for example, was that their lead among women exceeded Labour’s lead among men. But all British parties are vulnerable somewhere: the Liberal Democrats found it difficult to find a stable social and regional base; Labour has been overdependent on unionised males who work in heavy industry; and the Conservatives overdependent on women voters politically conditioned by circumstances which are rapidly disappearing. By breaking decisively with the political culture of the trade unions, with the masculine aggression and exclusivity which many women – not least working-class women – have found very off-putting, Blair made the Labour Party much more acceptable to women voters – a fact that could have profound implications.

This story has many lessons for both major parties, but a couple stand out. Before the election I suggested that the ‘tabloid culture’ to which the Conservatives, and Labour to some extent, slavishly capitulated was weaker than they thought. The election does not necessarily confirm this view but certainly lends it support. The electorate proved wholly indifferent to the race, gender, marital status or sexual orientation of Labour candidates, even where these were thought to be an issue. And the attempt by some Conservatives to work up an anti-immigration vote was a miserable failure: perhaps not surprising in a country to which there is now almost no primary migration – something they might have remembered. Aligned to the apparent weakness of tabloidism is the Conservative Party’s collapse among the ‘educated classes’. The great majority of those with university degrees no longer vote Conservative. Whole professions – lawyers, doctors, teachers (at all levels) research scientists (public and private), for example – which were once predominantly or significantly Conservative are now Labour-Liberal Democrat (and more Labour than Liberal Democrat): a change almost as important as the change in the women’s vote. It is important because the ‘educated class’ is growing faster than any other and is by training or inclination hostile to the Conservative Party’s traditional ‘tabloid culture’. Furthermore, some of these professions, like doctors and lawyers, have great social influence. The persistent opposition of the BMA, for instance, to the Government’s reforms of the NHS did great harm to the Conservative Party – and will do the same to Labour if the Blair Government abandons Labour’s traditional policies towards the NHS. If the Conservative Party (and Labour) accept that tabloidism is not invincible then the country might in future be spared some of the more shameful episodes of the last few years – like Michael Howard’s tenure of the Home Office – and the Conservative Party could regain some of its traditional support.

The other lesson both parties will be reluctant to learn. The size of the Conservative defeat suggests that the electorate was much more fed up with the system than New Labour thought it was. As Seumas Milne pointed out here (LRB, 5 June), the British electorate remains stubbornly attached to the welfare state and public provision. Indeed, throughout the English-speaking world, where market politics has been most successful, such politics has always been more of an affair of the political and economic élites than of the wider electorate. Everywhere unmandated politicians forced through programmes which the electorate had willy-nilly to swallow. In New Zealand, where the electorate has swallowed more than anywhere else, a popular revolt forced through a change in the electoral system (from first-past-the-post) precisely to stop politicians doing this. In so far as New Labour’s policies were dictated by extreme caution, the Government almost certainly has more freedom than it expected. Both the results and the exit polls strongly imply that voters do want more money spent and are even resigned to the extra taxation which might be necessary. On their side, the Conservatives must learn that the attempt to follow simultaneously self-contradictory policies – to legitimise a ‘revolution’ by anything but revolutionary means – must fail. Nor is it possible indefinitely to convince people that society is as the Conservative Party describes it. Reality will reassert itself and has a habit of doing so in nasty ways – it can lose you your seat and even the leadership of your party, or in the case of Michael Portillo, both. The election of William Hague to the Conservative leadership, though doubtless in part a result of personal animosities, does not, however, suggest that the Conservatives are ready to learn those lessons.