Tuesday, June 24, 2014

My review of The Orange Book from 2004

Today CentreForum organised an event to mark the 10th anniversary of the publication of The Orange Book. Thinking Liberal was there, and I gather there will soon be videos from the event on Youtube.

I am so old that I reviewed The Orange Book for Liberator when it came out - you can find the whole issue, which also includes articles on it by David Laws and Simon Titley, on the magazine's website.

You will see that I had more time for the ideas in the book than many in Liberator circles, but remember that this review was written after seven years of Labour government with many more in prospect.

Following today's event on Twitter, I saw a hedge-fund manager calling for strikes by people working in public services to be banned from striking. As so often when listening to economic liberal theorists, I wondered who precisely they thought would vote for their ideas.

Anyway, here is my review from 2004.

Orange blossom

Smelling faintly of brimstone, The Orange Book: Reclaiming Liberalism has arrived. If you get past the ugly front cover, you will find that The Orange Book consists of ten essays by prominent Liberal Democrats and a carefully worded foreword by Charles Kennedy: “Not all of the ideas … are existing party policy, but all are compatible with our Liberal heritage.”

That heritage is the concern of the first contribution as David Laws looks at the various strands of liberalism: personal, political, economic and social. He is particularly interested in economic liberalism and the way that  modern liberals seem embarrassed by it. The reason, I would argue, is that for most of the twentieth century liberalism was in decline and socialism was seen as the ideology of the future. It was not surprising that some liberals concluded that the way to prove that liberalism was still relevant was to show that it had anticipated socialism or was really a form of socialism too. So it was that we never mentioned free trade but missed no opportunity to refer to Keynes and Beveridge. The Conservatives' discovery of free-market economics in the 1970s only encouraged this trend.

Laws looks at the party's economic thinking, concluding that “economic liberalism has waxed and waned within the party over the past fifty years, reflecting on the whole the state of contemporary political debate, rather than long-held and cherished Liberal convictions". He is particularly good on the Alliance years: "Liberals and Social Democrats were merely left arguing lamely that the boundary between the public and private sectors should be left undisturbed, wherever it happened to be at the time."

Laws applies his enthusiasm for economic liberalism in a later essay on health, calling for the replacement of the National Health Service by a national health insurance scheme. He envisages a combination of public, private and voluntary providers, with people either choosing to use a state insurance scheme funded by a health tax on their income or joining an independent scheme. Such is the status of the NHS that any criticism of it is seen as near blasphemous, yet the ideas Laws puts forward operate in many Western European states which are every bit as civilised as Britain and which enjoy better health than we do. Nor is it ridiculous to ask whether the NHS can continue indefinitely as it is presently constituted if scientific innovation continues but people remain no keener to pay higher taxes to fund the resulting increased costs.

Other essays in The Orange Book will not raise the reader's temperature so much. Among them,  Paul Marshall writes on pensions, Susan Kramer on using market mechanisms to achieve environmental goals and Chris Huhne on global governance. In what is in many ways the most impressive piece in the book, Huhne concludes that globalisation promises great benefits but that international institutions must be reformed to allow them to operate effectively in a changed political and economic landscape.

Nick Clegg will alarm some readers by calling for powers over social and agricultural policy to be taken from European institutions and restored to national governments, but in reality his essay marks an advance in the party's thinking on Europe. Throughout those long years when people made unkind jokes about telephone boxes and bar stools, the argument that Liberal  members deployed to show that their party was still relevant was that it had been the first to advocate British membership of the Common Market. And in many ways we are still refighting the 1975 referendum campaign. We are happier defending that membership than we are recognising that we have been "in Europe" for more than 30 years (and are going to remain there) and then moving on to examine our views about how the European project should be developing.

Clegg argues that EU powers have developed in a lopsided way. He asks why the EU possesses detailed legislation on the design of a buses, the use of seatbelts in cars and noise levels in the workplace yet "remains invisible as an entity in the UN, ineffective in promoting peace in the Middle East, toothless in tackling international crime and terrorism". Being in favour of Europe is no longer enough: we have to decide what sort of Europe we want. Clegg's formulation is compelling: "the EU must only act if there is a clear cross-border issue at stake, or when collective EU action brings obvious benefits to all member states that they would not be able to secure on their own".

Vince Cable also has things to say about Europe, notably that "the CAP is an economic, environmental and moral disaster". In arguing this he is, of course, quite correct. It is, though, worth pointing out that British farmers were being subsidised 30 years before we signed up to the Common Agricultural Policy. Advocating free trade in agriculture would mean taking on this powerful interest group whether we were in the EU or not. In any case, Cable's contribution is not an anti-Europe rant but an appealing exploration of the tensions between free trade and social justice. He comes to the conclusion that government intervention often does more harm than good, making trade barriers seem something akin to the old nuclear arms race – they impoverish us all nations but they do not trust one another sufficiently to do away with them.

Which brings us to Mark Oaten. His almost tangible ambition gives him an unrivalled ability to get up the noses of  people in the party, but successful political parties are full of ambitious young men, so we had better get used to the breed. In any case, though he is a little too eager to be thought "tough" his essay here is sensible, calling for a stronger emphasis on education in prison and revealing that 95 per cent of prisoners need help with basic literacy. This surely suggests there is something seriously wrong with out schools if young people can emerge unable to read or write after 11 years of compulsory schooling, and also emphasises the missing chapter in The Orange Book – one on education.

Ed Davey's essay is easier to disagree with. He calls for liberals to embrace localism, yet his vision of local government is not attractive. He puts much emphasis on people's lack of respect for councils, yet where this exists it is can be put down to badly run bodies or ones run by the left of the Labour Party, and in both cases people are showing an increasing willingness to vote those responsible out. Davey wants to see fewer local councillors and to have them paid a salary, yet he does not consider the danger that this will distance local politicians from the people they represent and worsen the problem he sets out to solve.

Though there is little about it here, Davey is an enthusiast for regional government, even to the extent of backing John Prescott's version of it. This has little to do with local accountability – members of the new London authority have larger constituencies than MPs do – and much more to do with forcing through large-scale public projects like housing schemes and  motorways. Local government should be more diverse, more spiky and more local than that.

And then there is Steve Webb. Webb argues that liberals should not take a laissez-faire approach to the family, yet his views are not as ground-breaking as he seems to think. With the exception of a pamphlet I published last year, I cannot recall any Liberal Democrat questioning the move, rapidly accelerated under this government, towards more state intervention in family life. Certainly, none of the 64 references in his essay point the reader towards a dissident view.

Webb offers an apocalyptic view: our children are suffering more mental health problems than ever before,  they are starting school unable to talk or listen, they are turning to drink. What is strange is that this view is supported only by references to surveys and magazine articles. As an MP Webb must regularly meet all sorts of people who work for children, yet nowhere does he mention them. Basing his arguments on their testimony would have made for a more interesting essay – and quite possibly a very different one too. As it is, his work reads like a collection of press cuttings; it may be no coincidence, that Webb is the only person in the book to make his research assistant the joint author of his paper.

The answer to our predicament, Webb argues, lies in massive state intervention, delivered through the voluntary sector. He lists a number of schemes with approval, but it is hard to judge them because we have no direct knowledge of them. What is more worrying is that there is no sign that Webb has direct knowledge of them either. Again, he relies upon published references and gives no sign that he has met the people whose work he is praising. And,  while liberals will favour government support for the voluntary sector, its essence lies in the personal qualities of those who work in it and its local nature. Any attempt to roll out a scheme nationally will inevitably tend to reduce it to a trite formula that fails to reproduce the unique characteristics that made the original model work.

Somewhere in Webb's essay is the ghost of a more interesting, more personal contribution. One senses that he really sees our salvation as lying in a revival of marriage – he spends a couple of pages convincing himself that welfare benefits do not encourage young women to have babies out of marriage – and a greater role for religion. It is a shame that Webb did not write that other essay, because it might have offered the beginnings of an interesting critique of free-market economics. The traditional criticism of it is the Marxist one that capitalism will impoverish the workers, but we know by now that this is not true. A more subtle critique is the conservative, communitarian one which sees the free market as hollowing out important social institutions and acting as more of a destructive than a creative force.

Webb's essay as it stands, however, turns our idea of what constitutes virtue on its head. A healthy society sees it as residing locally – in the family and friendship and in strong local communities – and is distrustful of national government because it is distant and anonymous. To Webb, however, virtue resides in the state and in the professionals and volunteers whom it licenses, while families and individuals are weak and morally suspect.

The best thing about liberal economics is that is trusts the individual citizens. Socialists see them  as dupes of advertisers and victims of rapacious bosses, but liberals take a more confident view. Webb risks sneaking this patronising view back into the picture under the label of "social liberalism". He lends The Orange Book an authoritarian tone that may remind the reader of Larry Elliott's observation that the Thatcher years set capital free but left people more constrained than before.

So there you have The Orange Book or The Orange Part. Criticise it by all means, but if you do so from a "radical" position do please use arguments that go beyond warmed up labourism.

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