Tribune leader, 5 June 1992
“To secure for the workers by hand or by brain the full fruits of their industry and the most equitable dis­tribution thereof that may be possible upon the basis of the common owner­ship of the means of production, distri­bution and exchange, and the best ob­tainable system of popular administra­tion and control of each industry and service.”
Clause Four part four of the Labour Party constitution was not the most ele­gantly phrased statement of political in­tent even When Sydney Webb formulated it in 1918: today, its language seems not just clumsy and vague but archaic.
But it does make two points very clearly. First, Labour is a party of redis­tribution: it does not believe that the in­equalities of wealth thrown up by capi­talism are acceptable. Secondly, Labour is a party of common ownership: it does not believe that the means of produc­tion, distribution and exchange should be owned by a small minority of people.
It is the latter point that has been most controversial since the mid-fifties, when many “revisionists’* on the Labour right concluded that the party’s com­mitment to common ownership – seen essentially as nationalisation – had been rendered obsolete by the Keynesian rev­olution in macro-economic manage­ment. With progressive taxation and an expansion of the welfare state funded by growth, they argued, a “mixed” economy could now deliver all that Labour wanted.
After the election defeat of 1959, Hugh Gaitskell decided that Clause Four had to go as a symbol of the party’s willingness to march with the times. He was de­feated by party conference, of course, and Clause Four stayed – but ever since it has been honoured largely in the breach, particularly when Labour has been in government. Since the mid-eighties Labour has spurned promises of nationalisation even when in opposi­tion.
One reason is simply that nationalisation has grown ever more unpopular among voters for most of the past 40 years. During the sixties and seventies, the nationalised industries came in­creasingly to be seen as bureaucratic, unresponsive and inefficient. The fierce hostility to nationalisation articulated by Margaret Thatcher’s Tories struck a rich seam of popular feeling. By the late eighties, with the collapse of the economies of “actually existing social­ism” and the palpable Improvement in the quality of service from the utilities privatised by the Thatcher govern­ments, nationalisation was virtually unsaleable.
But this is not the whole story. A deep­er reason for Labour’s move away from nationalisation has been a growing scepticism about its usefulness as a tool of economic policy. Today, there is widespread Labour support for the idea that the main public utilities (gas, wa­ter, electricity), the communications in­frastructure (railways, roads, telecom­munications) and perhaps energy (coal, oil) should be controlled, if not wholly owned, by the state. Most are natural monopolies, some are inherently unprof­itable yet necessary, and all need to be carefully planned in the interests of all.
But few would insist that traditional nationalisation is necessarily the best model for these industries, and virtually no one believes that an extension of na­tionalisation much beyond this infrastructural base would be effective in se­curing Labour’s goals of increased in­vestment in manufacturing, sustained growth and improvements in efficiency. Indeed, there is a consensus at the top of the party that Labour’s advocacy of such an extension of nationalisation would actually undermine the credibili­ty of its macro-economic policies be­cause it would scare off multinational corporations from doing business in Britain.
So should Clause Four at last be con­signed to the dustbin of history? If it could be interpreted only as a call for ever-increasing nationalisation on the model adopted by Labour between 1945 and 1951, the answer would be “yes”. But nationalisation is not the only form of common ownership – and whatever the limits on Labour’s aspirations to nation­alise, there should be no doubt about the continuing relevance of the project of extending other types of common ownership.
Producer co-operatives and other forms of employee ownership are em­powering, with huge advantages over traditional privately owned firms even in capitalist terms: they could play a massively increased role in the British economy. There are also strong argu­ments for extending the co-operative sector in housing and for expanding mu­nicipal ownership, particularly in trans­port. A self-managed, non-bureaucratic common ownership should be at the centre of Labour’s vision. Clause Four is not the millstone round the party’s neck that its detractors claim.
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