Chapter One
The Good Society, Catholic Social Thought and the Politics of the Common Good
The Politics of the Common Good
Blue Labour was born of the desire for transformation and redemption, the very foundation of a good society and the politics of the common good. It was born of a recognition that the existing political economy, the existing system of the welfare state and a dominant financial sector was giving incentives to vice and not virtue, that it was leaving lives untransformed and unredeemed. The task of changing that involves finding another way of talking about the transformation and redemption of our politics, of a new political consensus based upon virtue and vocation, of a strengthening of relationships and society so that we are not dominated by money and public sector managers, so that the City of London and Westminster are not the sole geographical sites of power, and that political and economic liberalism are not the only definers of progress against which all other traditions are viewed as reactionary.
The generation of a new political consensus around the common good is a task of many hands, many different traditions, and we will be required to show an uncharacteristic civility to each other. The Labour, Conservative, Catholic, evangelical and civic republican traditions have not found a decent way of talking to each other, or even among themselves, for quite a time but they are the sources of nutrition out of which a new political consensus will be formed. The reconciliation of estranged interests is fundamental to a good society and to the common good and it is the work of no one institution alone.
The Labour Party has recently spoken a lot about public sector reform, the centrality of relationships, the decentralisation of power, the importance of accountability and participation of people in public life, so that they have some power and responsibility. In this context it is important to recognise that the contours of a new political consensus shared between the Labour and Conservative traditions are almost visible but also that this change will compel us out of our comfort zone. There will have to be coalitions between religious and secular, unions and employers, public and private sector, even Protestant and Catholic so that we can invite our exiled traditions home and have them engage with each other in creating the new institutions, relationships and practices necessary to treasure quality and equality, power and responsibility, virtue and vocation and above all the strange combination of democracy and liberty that distinguishes the English political tradition. Most particularly this concerns resistance to tyranny, understood as an unaccountable single interest that seeks to impose its will on others. The common good is also a retrieval of a political tradition that has served our country well for almost a millennium (the eight-hundredth anniversary of Magna Carta is in 2015), but has fallen into disrepute since 1945. It is time, perhaps, to domesticate the idea of a commonwealth that inspired the Tudor theorists before the Reformation.
It is a quirk of Blue Labour that we are fond of paradox, something that sounds wrong but is right, and in a rationalist, tin-eared and ungenerous Westminster village that has sometimes led us into trouble. Making statements such as tradition shapes modernity, faith will redeem citizenship, trust is the basis of competition, contribution strengthens solidarity, labour power improves competitiveness, decentralisation underpins patriotism can make us sound like highly educated idiots thus giving a new meaning to oxymoron.
Paradox is, however, necessary for understanding the politics of the common good because it will appear that strange people are in alliance, that incompatible ideas are working better together, and that – when these ideas cease to appear paradoxical but obviously right – political consensus change has been achieved. Perhaps the most important paradox is that the old is the new, that in interrogating exiled political traditions we will find the sources of our renewal. We don’t need new policy but a renewed polity which recognises the legitimacy of interests and facilitates their negotiation through renewed institutions that give incentives to virtue rather than incentives to vice. This is the politics of the common good in a nutshell.
What’s Going On? The crisis and the challenge to Conservatives and Labour
In order to give some definition to what a good society might look like as a means of locating the common good it is perhaps best to ask Marvin Gaye’s question of what’s going on before we move to Lenin’s subordinate question of what is to be done. I continue to be shocked by how Leninist our political class has become, how eager to engage in repetitive activity and how unwilling to reflect on where we find ourselves and why.
What’s going on is that society is disintegrating in the face of the state and the market which are characterised by centralisation, concentration and commodification. Ugly words and ugly realities, but I can’t find adequate alternatives. Both the market and the state centralise power in the name of efficiency and justice.
It is the tragedy of the conservative tradition since Burke that they have been unable to comprehend that the market centralises power, concentrates wealth and commodifies human beings and their environment. It has led to unaccountable power and the crash of 2008, that long-forgotten moment of clarity when the banks received the biggest subsidy in our national history, which was indicative of how dependent we had become on an avaricious and volatile banking sector with no alternative source of value in our economy. There has been a decimation of our regional banking system: not one of the demutualised building societies still exists as an autonomous institution. Northern Rock, Bradford and Bingley, Halifax, the Midland Bank, all dissolved into the City of London and the big six. Without constraints capital turns to oligopoly.
Equally important for the conservative tradition is that capital, through its pursuit of maximum return on investment, exerts tremendous pressure to turn human beings and their natural environment into commodities that are available at a price in fluctuating markets. Unless there are countervailing institutions with genuine power that can resist this there will be the systematic demoralisation and deceit that led to the financial crash. Without institutions such as families, churches, the army, universities, vocational colleges, professional associations and schools, that are founded upon a non-pecuniary definition of the good, that promote character, honesty, loyalty, skill and faithfulness, that create virtue and incentives to virtue there will be no space between the individual maximiser and the external aggregator, the market and the state. There will be no society at all.
The Big Society foundered on its inability to understand tradition and institutions as embodiments of the good, as countervailing forces to vice. It put all its eggs into the volunteering basket and the message got scrambled. That is the challenge of the common good. It is time for the conservative tradition to recognise the weaknesses as well as the strengths of the market that manifest themselves in poverty wages, usurious interest rates, the disintegration of skills and the subordination of character to the temptations of cheating and greed. There is a need to rediscover the virtue of institutions, local tradition and relationships rather than an exclusive concern with maximisation of returns and quarterly balance sheets. Our economy has been voided of value and fuelled by debt. A good society and a common good requires a change towards value and vocation.
This leads to the challenge to Labour and its uncritical turn to state administration and public spending as a default orthodoxy. In an almost exact parallel to the degradation of what is noble in the conservative tradition, Labour has, at times, been unable to understand how the state can undermine responsibility, agency and participation; that redistribution without reciprocity is just another form of domination and leaves its recipients untransformed. The Labour movement was born in opposition to the free market economy and the Poor Law State and under New Labour, it seems that we forgot both. I have received an astonishing degree of abuse for suggesting that the biggest mistake was the 1945 government – centralising, dominated by public sector managers and impervious to the traditions of labour and their organisations.
Germany went a different way after the war, building its approach around Catholic Social Thought and a form of social democracy that was social and democratic. It embraced subsidiarity and federalism in its politics, a radical form of decentralisation that enabled responsibility and power to be exerted at a local level. It endowed and established regional and sectoral banks that were constrained not to lend outside their region. They developed a partnership model between capital and labour in its corporate governance system that allowed for cooperation and conflict in the negotiation of interests and they retrieved a conception of vocation in their labour market entry that allowed for the preservation of status and skill and the reproduction of knowledge. Family, place and work were all recognised and honoured in a way that they have not been in England since 1945. We won the war, but have lost the peace.
The Good Society and the politics of the common good need to look soberly at vice and virtue and how to give incentives to the latter and not the former, as has been the case until now. Labour needs to repent of its exclusive reliance on an administrative state and the redistribution of money often through transfers to the private sector. Relationships, responsibility and reciprocity should be the guiding principles of welfare reform where contribution plays a central role in the renewal of solidarity.
1945, 1979 and 1997 were all false dawns that led to centralisation and demoralisation in our polity. We have an economy built around debt, a stagnation in wages, a deficit that refuses to shrink, a disaffection with politics, a degradation of previously trusted institutions amidst a backdrop of a generally subdued howl of powerless outrage. That is the background that frames the discussion of what needs to be done.
Catholic Social Thought
There is no more reasonable tradition from which to begin an analysis of the strengths and weaknesses of the Big Society and no more fertile terrain out of which to begin to fashion a politics of the common good than Catholic Social Thought. It provides durable materials, appropriate practices and profound insights in a synthesis that can challenge and defeat the combination of economic and political liberalism that has subordinated diversity to homogeneity, institutional mediation to individualised care packages, vocational training to transferrable skills and neglected entirely the conditions necessary for flourishing markets and democracy. Above all, it offers a system that challenges the debt and demoralisation that are the twin characteristics of the prevailing economy. It preserves and renews an approach which places institutions and tradition as necessary aspects of modern life and combines this with a robust and subtle conception of vocation, virtue and value, which are the missing practices in our economy and state.
In articulating the necessity of a balance of power between interests within institutions which pursue internal goods, Catholic Social Thought offers the possibility of a common good which is not an aggregate of prevailing interests, or a median point between conflicting views, but a negotiated ethical position that is built upon institutions, interests and practices in which the balance between tension and cooperation is always alive. It is redemptive but anti-utopian in that it views relationship, tradition and vocation as constitutive of a meaningful life but does not posit a world in which negotiation and tensions between interests have been overcome.
The fundamental insight is that while both a market economy based upon private property and price-setting markets, and a state based upon the rule of law and its enforcement are seen as necessary and a condition of justice and prosperity, they are also seen as a profound threat to a fulfilled human life and as sources of power that can dominate people. The tragic paradox of Catholic Social Thought is that while there is no alternative to capitalism, capitalism is no alternative. Also, while there is no alternative to the state, statism is no alternative for it is also, potentially, a collectivist instrument of oppression that can overrule and subordinate traditional institutions, which uphold a non-pecuniary good. The double paradox was resolved by a commitment to the strengthening of that which all forms of progressive social science insisted was doomed, namely society. Society, through the development of institutions built around the preservation and nurturing of status, solidarity and subsidiarity, of reciprocity and responsibility, could mediate the logic of both state and market which was to subordinate all self-organised societal institutions to their mutual sovereignty. Democratic decentralisation played a constitutive role in the formation of Christian Democracy as a political movement. This is a radically different idea to that of the Big Society and is, in fact, far more constitutive of the Labour tradition.
It was the threat to the possibility of a moral personality, of the dignity of the individual that led to the politics of the common good that would distinguish Catholic Social Thought, and the threat came from both capitalism and statism. The threat can be summarised as commodification in terms of capitalism, and collectivisation in terms of the state. Commodification refers to the process through which something that is not produced for sale in the market, human beings and nature for example, a body or a forest, are turned into tradable commodities with a price. The logic of capitalism is to achieve the highest possible rate of return on investment, which asserts a relentless pressure to create commodity markets in labour and land. In the 1830s in Britain vocational status and customary practice were subordinated to freehold title and clearing markets in the economy. Vocational traditions upheld by institutions and land holdings held by custom were viewed as an impediment to justice and efficiency. They were abolished in an alliance between the state and the market that imposed the dispossession of enclosures and the exploitation of industrialisation. The understanding of the way in which capital has a tendency to centralise ownership is well understood within the tradition and was institutionally mediated by the generation of local banks bound by trust to region or sector.
The state, through the demand of impartial administration, also generates an imperative to homogenise procedure and undermine relationships through its collectivist logic. The state can destroy those institutions of the body politic that allow reciprocity and responsibility to be strengthened if it is the exclusive instrument of delivery.
Catholic Social Thought, in other words, argued that those things held to be impossible under conditions of modernity – a sense of place and of human-scale institutions that was pursued through subsidiarity, a continued emphasis on vocation and vocational education and the pursuit of a balance of interests on the boards of companies and welfare institutions – preserved a sense of status that interfered with the prerogatives of capital and its managers from the point of view of classical economic theory and class consciousness for Marxists. A common good underpinned by a diverse range of decentralised democratic institutions embedded in the economy was the distinctive Catholic response to the twin perils of the state and the market, commodification and collectivisation. This was summarised under the heading of solidarity in which a common good was forged through common institutions that were diverse and decentralised in form.
It was Lamennais, a Catholic intellectual and activist who founded the journal L’Avenir in Paris in the 1830s, and not Marx who first coined the phrase ‘proletariat’ to refer to a class without status, assets or power and asserted the importance of mediating institutions that could preserve a sense of honour, skill and belonging in a dehumanised world, which was also a disenchanted, secular and rationalised world. Further, and most importantly of all, Catholic Social Thought remained faithful to a theory of labour value, labour understood in terms of experience, skill and expertise, rather than simply physical energy and time, that was held to be anachronistic and antithetical to the division of labour and managerial rationalism. Catholic Social Theory wagered everything on the relevance and strengthening of that which was held to be rationally impossible and it won. Further, its victory belongs to reason.
Both state and market were held to be necessary and wicked, capable of exploitation and oppression as well as justice and prosperity, and in that tension Catholic Social Thought has generated a unique gift to the modern world: a balanced view. There is not only a distinction to be made between society and the state, but also between society and the market economy, and most importantly, finance capital. It is impossible as well as wrong to have two contradictory systems, one based upon unmediated collectivism and the other upon unfettered individualism. Catholic Social Thought, through the idea of mediation and subsidiarity, represents interests through democratic institutions in the economy and the welfare system thus giving substance to the notion of society, making it not only bigger but more robust and less open to being preyed upon by the state and the market and their mutual desire for unfettered efficiency through the exclusion of institutions.
The reintroduction of institutional mediation is the task of a contemporary statecraft that seeks to generate a common good. The combination of finance capital and public administration, the market and the state, the public–private partnership, which has been the dominant driver of employment and growth over the past 30 years, has not generated very much energy or goodness. Of the £1.3 trillion lent by banks in the British economy between 1997 and 2007, 84 per cent was in mortgages and financial services. The practical predicament we confront is that in the combination of household debt and debt held by our financial institutions we are indeed a world leader and this ‘competitive advantage’ has been building for a long time. Private indebtedness was the most recent method by which we borrowed against our future to serve the present and it has reached its limit.
The theoretical predicament is that on their own, neither a Keynesian nor a neoclassical approach has the conceptual means of understanding the importance of institutions; of vocation, virtue and value in generating competitive advantage, reciprocity as the foundation of good practice and the importance of long-term relationships between capital, labour and place in generating growth and innovation. Catholic Social Thought gives us both a plausible explanation of crisis and a genuine alternative that can guide action.
The assumption that globalisation required transferrable skills and not vocational speciality, that tradition and local practice were to be superseded by rationalised administration and production was mistaken. The denuding of the country and its people of their institutional and productive inheritance by the higher rates of returns found in the City of London, and then the vulnerability of those gains to speculative loss, is the story we confronted in 2008. Further, the practice of relationships, reciprocity and responsibility were not present. The money managers of the financial sector functioned, within the corporate governance of firms, without oversight or accountability. Organised interests within the speciality and expertise of the firm are a far stronger basis for accountability than accountants and absentee and disorganised shareholders.
For the Catholic anthropology that underpins the theory that we are fallen and capable of both sin and grace and the balance between them is given by human relationships and human-scale institutions within which a balance of power prevails, where the individual proclivity to cheat and lie is tempered by an interest in long-term stable relationships based upon trust, mutual interest and oversight. Redemption is not a unilateral exercise but is, of necessity, relational. The corporation, corporatism, the body politic that animates the discussion of association within the tradition is not dominated by the mind alone but made up of various parts, dependent but undominated.
In Pope Leo XIII’s encyclical Rerum Novarum of 1891 this is captured by the idea of one hand washing the other, of the conflict and cooperation required for the common good, between organised interests within common institutions. There can be no account of the crisis of capitalism that does not refer to the failure of corporate governance within the financial sector, the lack of virtue and value present within it, the excessive self-regard and the perversity of its incentive structure that allowed the money managers to function outside of all constraint so that risk-taking became a synonym for recklessness and innovation a toxic cocktail of greed and deceit.
The answer is not new and better forms of regulation, but a reconstitution of corporate governance based upon a balance of interest in which there are incentives to virtue. Such incentives can engage with the organisation of interests and the priority of long-term stable faithful relationships in the economy rather than the faithless promiscuity that is the inevitable outcome of undomesticated capitalism. Perhaps the most startling conclusion that Catholic Social Thought leads us to is that having pursued bad for 300 years as a means of achieving good, it might not be such a bad idea to pursue the good more directly.
Labour and the Good Society
It will come as no surprise that it comes down to Labour in the end. The important and original work by Bishop von Ketteler in Mainz in the 1860s and then developed by Pope Leo XIII in Rerum Novarum and developed so profoundly since then was the link established between the Catholic theory of the person, of personality and the institutional arrangements required for the reciprocal development of personality and association organised around the idea that work is transformative of both nature and self. ‘By your sweat shall ye live’ is our fallen fate. The priority of the value of labour over capital is central to this thesis. In Laborem Exercens Pope John Paul II wrote that
Man is a person, that is to say a subjective being capable of acting in a planned and rational way, capable of deciding about himself and with a tendency to self-realisation. As a person man is the subject of work […] these act to realise his humanity, to fulfil a calling to be a person that is his by reason of his humanity […]. Labour is a primary efficient cause, while capital, the whole collection of means of production, remains a mere instrument or instrumental cause.
It will also come as no surprise that I argue that the distinction between predatory and productive capital is central to the position. This has two fundamental components. The first is to assert the ethical rejection of usury, the use of money to prey upon the vulnerability of the poor. This can only be understood if money is conceived as a power. In London Citizens we used to talk about ‘living wage’ and an interest rate cap of 20 per cent as the floor and the ceiling of the common house. Earning enough to feed your family and limiting the damage of debt is central to preserving a human order. Faith and citizenship are mutual traditions and not, ultimately, antagonistic. The living wage and an interest rate are examples of the state laying down a simple limit, not of regulation but of balance. The second component is to recognise, following the crash, that unconstrained financial capital does not lead to efficiency or growth but severed from practices that tie it to relationships and place generates a volatile nihilism that leads us to where we are: isolated, powerless and disappointed, abandoned without vocation and value before the demands of an unrepayable debt.
The lack of appreciation of the impact of deregulated markets on stable patterns of association, family life and traditions is one that goes back to Burke and has not been resolved through the Big Society. It is hard to engage in public life if you have to work two jobs because you are not paid enough to live. There seems to be no conceptual means for understanding the inequality of power within the market itself. In terms of its political economy, the Big Society is nowhere.
The same critique applies to welfare reform. A move needs to be made from a dualistic structure of public and private towards a Trinitarian structure. Any public institution is made up of three components: funders, users and workers. The state has interests, in justice and avoiding corruption, in the pursuit of wider and integrated forms of social policy but it should not be dominant and should have a third of the seats of the board on any public institution. Similarly, the workforce is a necessary aspect of the good of an institution and necessary for effective delivery. The workforce should, therefore, have a third of the seats on the board that decides strategy and delivery. Similarly, users need responsibility and power in the delivery of service and should not be passive recipients but actively structure the content of delivery. The domination of any single interest is to be avoided if we are to be faithful to the tradition.
So, for example, I argue that Labour’s response to free schools should not be to dismiss the power of parents in school governance but to bring that into relationship with teachers and funders in an institution that is committed to the common good. The same is true of hospitals and care homes. Relationships, reciprocity and responsibility are the key terms and are central to the Catholic Social Thought tradition as concerns the balance of power and interests in institutions. It is historically proven self-governing institutions, such as Cambridge University, with its endowments, trusts, college system and chaplains and the Catholic Church with its myriad decentralised orders, churches and institutions that can resist the domination of the state and the market and which, potentially, are allies in doing so.
A good society is based upon a balance of interests rather than the domination of any single interest. It is underpinned by a sense that your own interests are served if there is a sense that it is tied up with the well-being of others. A sense of shared fate that can generate sacrifice and solidarity. This is not a natural condition but is generated and sustained by a range of institutions that support the good. A good society is also a human-scale and humane society, where people can participate in having some power over their lives through working with others. We used to call it democratic politics, but I am sure we can work on the language.
The first condition of a good society is that power is decentralised so that a sense of place is restored, in which people can earn and belong to specific institutions and localities. Subsidiarity, the exercise of power at the lowest level possible commensurate with the performance of its function, which has its counterpart in federalism within the republican tradition, is a necessary condition of redistributing power and responsibility.
We need to return citizenship to the city and cease talking about its national meaning. We are subjects of the Crown, but emphasise that citizenship is civic status, it is natural to cities. Self-governing cities with embedded universities, vocational colleges, banks, parliaments and budgets that are governed by their citizens are part of that. We can imagine, for example, the City of London, with its mayor, guildhall, livery companies and aldermen representing all of London, in which all Londoners are citizens and where the democratically elected mayor lives in Mansion House and the Guildhall is London’s Parliament. The old is the new.
Renewed country hundreds with power and control over the countryside is its complement. People require institutional expression of their interests and the power to act in the world to pursue those interests. The flooding in the West Country in 2014 speaks of a lack of local power over their shared needs and a centralised power that had other concerns. Dredging rivers should be part of the local calendar and fulfilled by local people upholding their responsibility and duty to the good. In specific institutional terms the common good can be pursued through the corporate governance of all schools and hospitals consisting of one-third funder, one-third user and one-third workforce: the three constituent parts of any institutions who negotiate a common good and hold each other to account. So in any school a third of the seats on the governing body would be held by the funder, whether that be the state or the local authority, a third by parents and a third by the teachers.
This is linked to a recognition of work, and most particularly of vocation as a central aspect of the preservation of value, whether that is understood in the determination of price or by the ethics of the person who embodies the vocation. The importance of work and the work ethic is something that should be at the heart of the Labour Party: labour is constitutive of our humanity in terms of childbirth and family life, the transformation of things through skilful action, the meaning of going to work.
It is vital that the vocation of teaching is restored, but where is the institution that upholds the tradition, the practice and the craft of teaching and enforces it within the sector? There is none. That is why we need to establish a college of teaching run by teachers, for teachers, to restore the vocation from the conditions of proletarianisation that have been imposed by a coalition between government and the teaching unions since the war. The consequences of pursuing decentralisation, vocation and a common good in education are surprising. It requires different pathways at 14 and a new respect for a vocation that leads to an apprenticeship in a specific skill. It requires labour market reform that gives to plumbers the same market status as dentists and accountants. It requires a substantive reform of higher education which could involve turning half our universities into vocational colleges run and funded by a partnership between local business, unions, and civic institutions that employ local people such as hospitals and universities and city governments. The generation of mutual interests where there is now estrangement is one way of conceptualising this. Renewing vocation is another.
The common good will also be carried by the need for new financial institutions and the problem of debt. Pope Francis called usury the way that the rich prey upon the problems of the poor, and that is the case when Barclays lend to the Money Shop at 7 per cent and they begin their lending at 5,500 per cent. The Pope has spoken out, and Archbishop Justin has also led courageously on this issue and wishes to build an alternative banking system through the credit unions.
Guy Opperman is helping set up a community bank in Hexham. Unite is supporting the establishment of the Bank of Salford, bound to lend within Salford, and has consolidated the credit union funds; the local authority is putting its payroll through it and it is taking deposits from local people. A politics of the common good would reconcile the churches and trade unions in upholding a status of the person through building institutions that serve the interests of the poor. The unions would redefine themselves as having a civic function within society rather than an exclusive concern with the party and the state. The Church would fulfil its calling as an embodiment of the good. The bank would lend to local businesses who have suffered from the disintegration of local banking systems and the lack of affordable credit. Businesses, unions, churches, mosques, local authorities, all seeking a common good through the sharing of resources and local leadership and initiative. Participation, enterprise and a renewed sense of solidarity are the results of building local institutions together, which is another way of talking about the politics of the common good.
When I see Justin Welby speaking alongside Len McCluskey in the shared pursuit of the good of the city I will know that the agenda is really taking form. The future should be shocking and full of surprises.
Conclusion
The new consensus, built around the common good, will be pro-business and pro-worker, it will be patriotic and localist, it will be based on lower tax but higher participation, a balance of interests that facilitate negotiation. One of the paradoxes I mentioned at the beginning of this essay was that tension is necessary to reach a common good, we have to learn to stay in the room and represent our interests and explore how they can be reconciled with others. The fundamental insight is that we cannot do it alone. We need relationships, institutions and other people to fulfil ourselves.