ritain's Labour Party wins a 4th landslide victory! In an astonishing turnaround in political fortune, the unthinkable six months ago, happened. How? After trailing the Conservative Party in the opinion polls for over a year, Labour broke free with a combination of good luck, global thinking and centre-left led grassroots organisation.
For democratic socialists at the heart of the process, it began with Prime Minister Gordon Brown's response to the banking crisis in October 2008. Instead of letting British banks go to the wall, he ordered a massive tax-payer funded bailout.
Leaders of the world's leading economies couldn't halt the major squeeze on global and domestic credit, and an inevitable recession. But it would have been much worse if Brown had slavishly followed the Americans 18-months previously. They had let Wall Street investment banker, Lehman Brothers go into administration. Brown proved that being a Labour Prime Minister does not mean surrendering sovereignty to Washington. This was in sharp and deliberate contrast to Tony Blair.
While Labour's political opponents remained locked in their domestic bunkers, Brown strode the world. He knew his Labour history. Each Labour government throughout the last century was punctuated by a loss of confidence in its economic and financial competences in the City and, latterly, world markets. In the period from the early 1970s, neo-liberalism dominated government, and mainstream political party thinking. Who would have imagined that the world would lose confidence in the banking system and that, paradoxically, a British Labour Prime Minister would be praised around the globe for bailing them out to avoid a deep depression?
So a plan was devised to break free from the twin tyrannies that have blocked the road to socialism throughout the 20th century. As signs of economic recovery emerged, Labour flickered in the polls, narrowing the gap with its opponents. If votes were to be garnered, the Party needed to act decisively. Fifteen months after the bail-out, British-based bankers were choking on their prawn cocktails. Their employers were to be taxed at a punitive rate of 50% on the value of any form of bonus. This was despite dire warnings of an exodus of bankers from, er.bankers. The super-bank bonus tax announced by Britain's Chancellor of the Exchequer Alistair Darling on 9th December 2009 signalled the start of an international campaign coordinated by Brown to ignite a real bonfire of the vanities. The super-bank bonus tax was a marker, not a source of much additional tax revenue.
Far more significant was the paradigm shift from neo-liberalism. Self-styled 'masters of the universe' have a debt to society. Having led the way by bailing out the bankers, Brown sought recompense. In much the same way as the 'polluter pays', Brown established a 'profligate pay' principle. Grappling with the fat-cat culture was going to take generations of political education. Rather than indulge in gesture politics and nationalise the banks, Brown was persuaded to back a global financial transactions tax. This is commonly after its originator, US economics Nobel Prize winner, James Tobin. It offered the scope to bring the global financial services sector into the tax net, generating billions of dollars of new fiscal revenue. Brown saw it. The cost of saving the British, and possibly the world, financial system would finally be borne by the people who triggered the crisis, not low-paid and middle income workers.
The political potency of this idea fired the imagination of new campaigners in the Labour Party. They devised a political narrative and rolling campaign to convert populist opposition to the 'fat-cat' culture, and clamour for greening the planet, into votes for Labour. It enabled Labour to reconnect with its core support and middle-class coalition on whom it had depended for its electoral success in 1997, 2001 and 2005.
In an unprecedented display of unity the splintered factions of the Labour Party's centre left from Compass to the Labour Representation Committee, together with affiliated trade unions and socialist societies, regrouped in a Coalition for Labour Victory. Their common electoral strategy also paved the way for major Party reform following the unexpected result. Brown volunteered to stand for re-election as Labour Party leader to set the seal on party renewal. In a flourish another step to reverse the command and control culture under New Labour leader Tony Blair was taken. A values-driven transformation in Labour's electoral fortunes was under way.