Experts say British politics are undergoing a post-neoliberal shift. They are wrong
Shortly before the 1979 general election, Labor Prime Minister Jim Callaghan warned of a “radical change in policy” in favor of Margaret Thatcher’s anti-social agenda. There is today a lot of speculation of a similar “philosophical shift” from the anti-state and neoliberal policies of the past decade, a enhanced view by last month’s budget.
The last century has already seen two tectonic reversals in the government of philosophy. The first was the post-1945 social democratic experience and the second was the Thatcherite counterrevolution of the early 1980s. It is this second type of politics that experts say is on the way out.
There is no doubt that COVID-19 has had a galvanizing impact on the role of government, with elements of the pro-market and anti-state rulebook being torn apart in favor of an unprecedented, in peacetime, state response to support jobs and incomes, and an increase in public spending and tax levels. But do these changes herald a more fundamental change of direction or a simple political adjustment, a temporary and pragmatic response to a national crisis? As Robert E Lucas, one of Chicago’s post-1980s market revolution high priests, observed, “We are all Keynesians in a tug-of-war.”
There is no better litmus test of whether we are ready for a new governance paradigm and a better post-COVID society than what is happening to deep-rooted British society. to divide. Over the past four decades, rising inequalities have been accompanied by a doubling of the poverty rate. If a post-Thatcherite or post-neoliberal change were to occur now, we would expect to see clear steps to counter these trends in inequality and poverty.
A key element in a more effective fight against poverty must be a major restructuring of the benefit system. Next year is the 80th anniversary of Beveridge 1942 Report, yet at least three of its five giants – misery, ignorance and misery – have not yet been abolished. Despite a slight change to the universal credit system in last month’s budget, Britain’s social security system is still petty, uneven and punitive. In some ways, the dark shadow of Victorian “poor law”, more anti-poor than anti-poverty, remains a key driver of modern social policy. The number of people applying for social assistance is still lower than in most other European countries, while in the last decade more than five million state sanctions were imposed on benefit claimants, two-thirds of whom were left with no income. At one point, the Ministry of Work and Pensions was impose more fines through local employment centers than the traditional court system.