Monday, November 07, 2011

A follow-up to New Labour and poverty reduction

I got a fair-amount of e-mail in response to my recent post on New Labour and poverty reduction. One correspondent from Britain was the admirable Peter Ryley (who blogs at Fat Man on a Keyboard). Our brief e-mail exchange is posted below, with his permission.

PR: The book is quoted as being about raising "the absolute living standards of the least well-off." Welcome though this was (unlike today), the critics of New Labour attacked its neglect of the relative living standards of the poor - in other words, equality. The argument of people like Wilkinson and Pickett is that equality - relative living standards - is as, if not more, important than absolute poverty once you reach an adequate level of subsistence.

JW: Yes and no, though there's a lot of truth in that, too. The analytical distinction between improving the condition of the poorest and reducing overall inequality in the society is important, and New Labour was (to borrow some old metaphors from T.H. Marshall) more interested in raising the floor than remodeling the overall structure. Nevertheless, we should recognize what the Blair/Brown governments did accomplish in terms of poverty reduction, which was not of trivial significance (if one considers the alternatives).

PR: Yes agreed. My main criticism of New Labour was precisely captured by Marshall's metaphor. The house in question is a model of political economy. Thatcher's abandonment of the post-war consensus to move into a new building reversed the post-war trend towards greater economic equality. It was felt that there was a conflict between efficiency and equality. Labour had long been the party that represented an alternative building, an evolving version of the post-war consensus. New Labour changed the party's role from being builders into home improvers. The house we were in certainly needed doing up and that was more than welcome. But I was always critical of this policy of accommodation as I felt that the new house was jerry-built and its foundations were subsiding. The old mansion next door was remarkably robust by comparison and I wanted us to move back in. In short, I thought they were improving the wrong house. We are living through the consequences of that structural failure, especially in Greece today. So the need to think in terms of alternative models of political economy has never been greater.

Hard to argue with that last point. —Jeff Weintraub

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