That is why the Labour leadership election is probably the most important in British politics for a generation. The victor can define the next political era as surely as Wilson did in the 1960s or Thatcher in the 1980s. He or she will face a Conservative Party struggling with a crisis that goes far deeper than a few quarters of negative economic growth.
Two years ago, J K Galbraith wrote a book called The Culture of Contentment. The 'economically and socially fortunate', he argued, had become the electoral majority. Grown fat on post- war economic growth, cushioned by state services and subsidies, they would always vote for the status quo. The losers - an underclass, rather than a proletariat, trapped mainly in the inner cities - would lack the political strength to achieve change. Right-wing parties thus became the natural governing parties while left-wing parties would attain power only by embracing broadly conservative principles. It now looks as if that thesis was flawed and that, in Britain and America at least, it works better as an explanation of politics between, roughly, 1952 and 1992 than it will as an explanation of the next 40 years.
The flaw was that the new middle-class masses have not remained contented. Instead, the culture has turned into one of anxiety and insecurity. Middle-class life was not just a matter of money in the pocket, but also of expecting more money in future. The conventional career - with its annual pay increments, its clear promotion ladder, its job security - is in steep decline. The big corporations and banks are hugely reducing the numbers of managers. A Mori poll of the middle-classes (the advertisers' ABC1 categories), published in the Sunday Times last week, found that nearly 1 in 4 had experienced unemployment or redundancy in their immediate family in the past few years. And as many as 35 per cent feared losing their jobs in the next 12 months.
The Tories' dilemma is not just that they have presided over this profound social change - which threatens to make middle- class lives almost as insecure as most working-class lives have always been - but that they have celebrated it. We should strive for more competition, more efficiency, less regulation, less corporate fat. That is the Tory message - with some justice, given the need to compete in global markets. But, far from trying to soften the effects, ministers are extending market disciplines into new areas, such as education, health and the Civil Service. There is worse. The guiding light of Conservative economic policy has been the conquest of inflation. Now, at enormous cost, it is all but conquered, though to hear the Chancellor and the Governor of the Bank of England, you would never think so. Yet many people looked to inflation to ease the excessive mortgage debts incurred in the late 1980s. Other Tory policies, such as limiting mortgage interest tax relief, have helped to depress the housing market.
The combination of job insecurity and static house prices could be deadly for the Tories. All the aspects of middle-class life that the Tories have wanted to encourage - private education, private health insurance, private pension schemes - require long-term financial commitment and, therefore, the certainties of future income and capital. Lacking these, the middle-classes turn back to state services and find them sadly eroded: under-funded schools, the NHS in turmoil, the old-age pension barely above subsistence level. There lies the golden opportunity for (most probably) Tony Blair. The danger is that he tries too much to trim his agenda to that of the 1980s; far from being enamoured of such words as 'market' and 'choice', electors are likely soon to find them as repulsive as 'nationalisation' used to be.Reuse content