Mr Blair's Arnold Goodman Charity Lecture in London made clear his belief that many so-called 'radicals' who resisted change were conservatives with a small 'c' who risked Labour losing the next election.
The indictment of traditionalists who believe the party only needs to reinforce its previous message more strongly came as Mr Blair insisted that Labour had to create support based on community principles, not just class or outdated economic ideas.
The speech took as read Labour's commitment to redistributing wealth to provide employment and training opportunities, a free health service and decent state education, concentrating on the ideology that would persuade people to vote for it in place of post-Thatcherite Conservatism.
As social change had come about, he said, support for Labour had declined from more than 50 per cent in 1951 to just under 27 per cent in 1983. It had lost four elections. There was a theory that Labour lost because it was 'not sufficiently 'bold' or 'radical', standing up for its principles against the Tories.' But the simple reason was society had changed and Labour had not changed sufficiently with it.
'Precisely because socialists worked to change society, people became more educated, prosperous, prepared to question and demand. But it has a natural political consequence.'
Mr Blair insisted that 'modernisation' was not about destroying the left's essential ideology, but about retrieving its most basic belief - that people were 'members of a community and society that owe obligations to one another as much as to themselves and depend on each other, in part at least, to succeed'.
The remarks came, though not by design, on the day Transport and General Workers' Union conference delegates delivered their most unreconstructed attack on John Smith's 'one member, one vote' proposals, which Mr Blair supports strongly. There were cries of 'rubbish' when Mr Smith mentioned 'modernising' to them on Wednesday. Yesterday, Labour MPs were decried for going to university, or being 'yuppies'.
Mr Blair said 'modernisation' was not just creating a modern party organisation but a programme for a modern society, economy and constitution. 'The issue is not whether to be 'radical' or not, but what being 'radical' means in today's world.
'Labour does need a clear identity, based on principle. But the identity should be one for the modern world, not a throwback to a romanticised view of the past.'
Equating 'community' - meaning, Mr Blair said, mutuality of interest and obligation beyond narrow self-interest - with socialism is a recurring theme on the 'modernising' wing of the party. But Mr Blair appeared to go further in trying to consign to history what he views as damaging beliefs about a command economy that served its purpose in a different era. ' 'Intervention' or 'planning' become identified as state control. 'Market competition' becomes synonymous with greed.'
In the sphere of crime and social disorder, the left had tended to undervalue individual responsibility and the right had ignored the influence of social conditions.
Economically, the new relationship between society and the individual called for the creation of a genuine partnership between the public and private sector, while in public services the emphasis should be not on who provides, but on what was provided.
'We should open up the issue of how public services are funded, how we raise money and how we spend it; and how we link tax and spending more clearly to the objectives the public want. In fighting poverty, the aim is not to maintain dependency on the state, but to create the conditions for people to escape it,' he said.Reuse content