Fifty years ago Friedrich Hayek published an essay called The Intellectuals and Socialism. It reads curiously today, because it is so despairing about the future of liberal capitalism. Hayek thought that modern society had produced too many intellectual generalists (academics in the humanities, journalists, teachers, publicists)-people who "purveyed second- hand ideas... but are usually amateurs so far as the substance of what they convey is concerned."
The great Austrian-born economist had a mordant view of these people: "It is the absence of direct responsibility for practical affairs and the consequent absence of first-hand knowledge of them which distinguishes the typical intellectual." He also thought that they had, as a class, got hold of the wrong end of the economic stick: "Their peculiar propensities manifest themselves in making shibboleths of abstractions... the most powerful of these general ideas which have shaped political developments in recent times is the ideal of material equality."
Nevertheless, Hayek did not think that intellectuals needed to be wholly lost to the politics of the right. He proposed building an intellectual cadre which would espouse "a truly radical liberalism which does not spare the susceptibilities of the mighty... and which does not confine itself to what today seems politically possible... Free trade and freedom of opportunity are ideals which may still arouse the imagination of large numbers... If we can regain that belief in the power of ideas the battle is not lost."
We now know that Hayek's plea was brilliantly successful. Antony Fisher, a former fighter pilot who introduced battery chicken farming to Britain, read Hayek and followed his advice. In 1955, he set up the Institute of Economic Affairs, the first of several right-wing think-tanks which provided Margaret Thatcher, in opposition and in government, with an intellectual framework for her mission. Neo-liberal ideas passed deeply into the British political classes' bloodstream; as the Conservative MP Oliver Letwin recently wrote in his pamphlet (for Politeia) entitled Civilised Conservatism: "Thatcherite Conservatives in this country made more progress towards free markets, and made more convincing attacks on socialism than in any other western liberal democracy. The attacks were so effective that socialism went further underground in this country than in any other."
Thatcherism stimulated no opposition of comparable force. None could be created. "More socialism" had limited appeal; it caused the Labour party to split, and almost reduced it to third party status. A revival of corporatism was unconvincing, given the low status of the unions and lack of interest of the big corporations. The economic terrain was Conservative; and for all the many ideas, projects, plans and wheezes which left intellectuals came up with in the 1980s and 1990s, this remained the case on the eve of Labour's election victory-as two of the left's leading intellectuals have recently attested. Stuart Hall, former professor of sociology at the Open University, noted in a recent essay that "the left was not in good shape when New Labour took office." David Marquand, head of Mansfield College, Oxford, admits that "the ideas which were pulsing around in the 1980s and 1990s, like stakeholding, were not complete. It would be too much to say that New Labour should simply have put them into legislation. The ideas were Keynes in 1930 not 1935." Thus the first alternative to Thatcherism-New Labour-arose from a more or less explicit recognition that the neo-liberal arguments had carried the day in the macroeconomy. There was no new revisionist consensus.
New Labour has been like a modern couple who delight in buying a sturdy Victorian house, but then knock down walls, strip the wood, expose the brickwork, make more space and let in more light. In so doing they transform the look of the place, but preserve its solid foundations. Implicit in this is the loss of a grand narrative-rather as the modern couple opt for the familiarity and cosiness of a Victorian house, rejecting the stark modernism of 20th-century architecture which, for all its failings, was an alternative architectural narrative. The orthodox management of the economy is taken for granted: low inflation, low budget deficits, low pay rises. There is no attempt to reshape a "modern" corporatism. "There is no question," says Matthew Taylor, who was Labour's assistant general secretary for policy and now heads the Institute for Public Policy Research, "that the new economics sidesteps the old debates. There are still important debates to be had, but not of the grand kind."
A consensus on the macroeconomy is not all. Jack Straw is no longer opposed to private prisons, nor does he quail at increasing the population of all prisons. No privatisation has been reversed, and new ones are planned. The private sector is as keenly wooed as it was under successive Conservative governments. New Labour conforms to Francis Fukuyama's prediction that politics after the end of history would be rather dull. There is as little clash of the political tectonic plates as possible; and the clashing of tectonic plates is what political intellectuals get excited about. So how are they fitting themselves to New Labour, as it approaches its third victory conference and still seems set to govern deep into the new millennium?
they were supposed to fit in very well. No government-in-preparation has been so explicit about its desire to involve the Academy and the intelligentsia. And as he prepared for power, Tony Blair was regarded by many on the intellectual left with approval-even if, sometimes, of a condescending kind (Gordon Brown was seen as the real brains and closet radical). Martin Jacques, former editor of Marxism Today, praised Blair lavishly in a magazine profile after he was elected party leader. Roy Jenkins, chancellor of Oxford University, gave Blair enthusiastic endorsement. The founder of the constitutional pressure group Charter 88, Anthony Barnett, told me that he thought Blair was a genuine radical committed to a programme of fundamental constitutional change, and that the left was wrong to cavil.
But that did not last. Most intellectuals of the left now dissociate themselves from New Labour and especially from the Third Way-its efforts to create a political philosophy-of which most speak with scorn. The hopes of New Labour in opposition-that it could create a penumbra of pro-Labour scholars who would feed in ideas-have collapsed; while the hopes of the Academy, that New Labour would reach out to them in new ways, have been dashed. Both sides speak ill of each other, often in public.
The particular institutional failure has been Nexus, an on-line network of scholars brought together in the mid-1990s to provide policy advice and constructive criticism for the leadership. It was heavily patronised by Downing Street policy aides; it held seminars in many universities and had two seminars at No. 10 with Blair. It now has no more than a shadow existence. In part this was bad luck: David Sainsbury had promised backing for it, but following attacks on his retail group for benefiting from his closeness to Labour-he is now a government minister-he drew back. Nexus's main organiser, David Halpern of Cambridge, had to withdraw for personal reasons. Halpern says: "Nexus tried to combine two functions: one was to further the debate on the Third Way; the other was to develop evidence-based policy research and analysis. We didn't have funding for either."
But the larger reason why Nexus didn't work and will not be tried again is that most of the New Labour policy intellectuals believe academics are no longer useful to the government-except as experts in specialist fields of, say, health economics or information technology. In such fields, the ministries and No. 10 use them a great deal (defence academics were used extensively in last year's defence review). But they don't want to debate big political ideas with them.
Speaking anonymously, one No. 10 policy aide said that "at one level, in specific areas, armies of academics are coming in and out as never before. Thatcher didn't do as much as we are doing, I am sure. For Blair's Beveridge lecture on welfare we had a large number of academics writing background papers-including some, like Ruth Lister, who have been highly critical. The Social Exclusion Unit's report drew on a lot of scholarly work. But in political philosophy it has been a failure. The Third Way debate was launched in the hope that intellectuals would get excited about it; but they have responded by saying it's pointless."
Charles Leadbeater, a writer on policy and technology who has advised the government on a range of issues, is even more dismissive about academics. "The nature of academic life means that academics don't think comprehensively enough. They are trapped in their own research agendas. There used to be a seamless web between Oxbridge, the elite intellectuals, Whitehall and government; but now intellectuals are by no means the main source of ideas." Tom Bentley, who took over as director of the think-tank Demos when Geoff Mulgan, its founding director, went into No. 10's policy unit after the election, agrees: "Look at the way knowledge is created across society. The most dynamic sectors are not in academia, so the old closed relationship between governments and academic elites is being blown open." Halpern is more sympathetic to the working patterns of his academic colleagues, but makes a similar point: "Academics like doing their own thing: they're not good at understanding political pressures. And the new Research Assessment Exercise has made a difference; academics are busier filling their research quotas. It's a disincentive against getting involved in other areas."
Leading university-based intellectuals will continue to pass through No. 10-several, for example, will be delivering lectures there this autumn on "challenges of the new millennium." But many of the most favoured thinkers are practical men and women. David Potter, founder and chairman of Psion Computers, began a talk to a No.10 seminar in May: "I am not an economist and I shall not take an academic approach." He went on to say that British universities, although "excellent" in basic research, were "way behind in their thinking." He cited the example of Stanford alumni "who have created businesses with a current value of over one trillion dollars."
Thatcher liked intellectuals of the right; she needed their fierce and divisive passions, their compulsive battling with enemies and their belief in the force of ideas; she believed, in her own way, in grand narratives. New Labour, by contrast, does not need such intellectuals; the cadre of thinkers it is attracting and is seeking to create are not "big thinkers" in either the socialist or Thatcherite sense. They are highly directed ideas people-what economist Paul Krugman calls policy entrepreneurs. Mark Leonard, the 25-year-old director of the newly founded Foreign Policy Centre, is seen (by foes of New Labour) as a stereotypical New Labour intellectual-brashly and ahistorically writing about "rebranding Britain." He says that "the problem for the big public intellectuals is that New Labour operates a pic 'n' mix approach. The disillusioned people like Will Hutton [editor-in-chief of the Observer] weren't comfortable with this because they wanted to be taken seriously. But people are dropped very quickly. And picked up very quickly."
The three men who, in the 1980s, were the most influential shapers of left-intellectual apprehensions of Thatcherism and who, for a period, were a real source of influence on the Labour party, have all expressed their contempt for New Labour. The historian Eric Hobsbawm, the sociologist Stuart Hall and the writer Martin Jacques were respectively the two star writers and the editor of Marxism Today, the Communist party's monthly journal, whose Marxist revisionism helped Neil Kinnock claw away from the Trotskyist-Bennite swamp in which Labour almost drowned. Jacques had been briefly enthusiastic about Blair, but after New Labour had been in office for 18 months, he convened a gathering of some 50 academics and commentators to dissect its failings. The meeting was remarkable for a set-piece confrontation between Geoff Mulgan, a former Marxism Today contributor, now a Blair aide, and Hall and Hobsbawm. Mulgan harshly criticised the two for failing to provide an adequate account of the shift in politics which had happened since the end of the Thatcherite era. In an article he wrote for a special issue of Marxism Today, he accused them of "woolly logic," "idiosyncratic" and "absurd" assertions, "sweeping, abstract generalisations" and ended with a dismissal of leftist academics worthy of Hayek: "Reading the Marxists... you sense the cloying atmosphere of the seminar room. Political ideas are discussed in the same way that one might discuss Mayan architecture or medieval history. Society is viewed from the outside, without any sense of membership or responsibility... It is no longer enough for arguments to be interesting or eloquent: they also have to be realistic and practical."
That writers working in the Marxist tradition should be repelled by a social democratic government (even if they dispute that it is so) is not, in the end, surprising. But among the big public intellectuals who are not of the right, few have endorsed New Labour and all have tended increasingly to scepticism. Michael Ignatieff, who made a plea in Prospect two years ago for more independent intellectuals to "rescue knowledge from the closed language games of specialists," has warned more recently (in the London Review of Books) that the Third Way could degenerate into "using liberal (leftist) rhetoric to recruit the votes of the poor to win office and then using fiscal conservatism to betray them in power."
Similarly, Ralf Dahrendorf, the former director of the LSE, who for three decades has been at the centre of the nexus between political and academic life, sits as a Liberal Democrat peer in the Lords. He is an extreme sceptic on the Third Way. But both Ignatieff and Dahrendorf are more engaged with an international than a domestic agenda. Indeed, the decline of big domestic divides now means that the most important debates are in the international arena, especially as globalisation brings down the barriers between the two. In Britain it is arguments for and against further European integration which will arouse the most intellectual passion in the next few years.
An even more significant sceptic is David Marquand, the most important social democratic scholar in the country. He has been a Labour MP, an aide to Roy Jenkins when the latter was president of the European commission, a founder of the SDP in the early 1980s and a politics professor. His books-The Unprincipled Society, The Progressive Dilemma and The New Reckoning-all grapple with change and what it means for the left. There is not much of the cloying atmosphere of the seminar room about him; nor of Marxism. But he finds himself singing in a dissenting chapel rather than in a church he no longer believes to be broad.
Marquand has been invited to discussions with New Labour aides and to a seminar with Tony Blair in No.10 last year; yet he has become scornful. "The government doesn't seem to want to get engaged in fundamental discussions. Its effort to draw on people from the Academy is largely window dressing. It wants people to agree with it. Blair-I hope this isn't snobbish-is a typical lawyer. Particularly an Oxford lawyer. The guys who do law here are narrow. It's not like Harvard where they're encouraged to go into jurisprudence and think about the world.
"One doesn't want to be nostalgic, but it is quite different from previous Labour governments. Wilson was not seriously interested in ideas, but he took a brilliant first and was part of a culture which made him think he should be. And in his cabinets he had Roy Jenkins, Denis Healey, Richard Crossman and Tony Crosland, all of whom were men of substantial intellectual gifts." Marquand emphasises the distinction-made by many-between Blair and Brown: "The only person in Blair's cabinet who matches these men is Gordon Brown. I talked to him once after a lecture I gave for Charter 88 on constitutional change. He wanted to talk on late into the night, much later than I did. Brown wants to be engaged with everything, from close detail to abstract ideas. I think I recognise in him a formidable intellect." Matthew Taylor at IPPR puts it a little differently: "Blair's account of politics is more influenced by sociology; Brown's by political philosophy. In a Brown speech you will usually find historical references to people in the movement; in Blair you will find a more focused effort to clear the ground for the new values New Labour wishes to espouse. This was most brilliantly done in opposition; in a speech he gave on the same day Gordon was talking about endogenous growth, Blair redefined politics. He said you didn't need to be for management or for unions, but for success for all in a company through partnership. You didn't need to be for low or high tax, but for tax which was fair or unfair. He took the struggle out and made those who insisted on struggle into extremists. Many political intellectuals don't like that."
In others-and to an extent in Marquand-the capture of Brown as an intellectual is also recruitment of him into the ranks of solid social democracy, away from the embrace of a No. 10 more interested in spin, appeasement of the Daily Mail, and new technology. Marquand praises Brown because he showed himself serious about the constitution-a seriousness he sees as lacking in Blair. In an article in the June issue of Prospect, Marquand says that devolution will "unravel" if Blair does not face up to the contradiction between a "populist" and "pluralist" conception of constitutional reform. In a passage as critical of Blair as any of the Marxists, he wrote: "New Labour won control of the party by using 'the people'-in the shape of opinion poll findings-as a stick to beat their own activists; and the habit is hard to break... When institutions are in disarray, when norms point in different directions, when the old constitution has become a messy jumble of bits and pieces, the simplest way to cut through the resulting contradictions is to appeal directly to the sovereign people, over the heads of such intermediaries as remain... Today's populists need not rely on intuition. They can find out, with a fair degree of accuracy, what the people want (or think they want) to hear, and they can trim their messages accordingly. The focus group becomes a surrogate for Rousseau's General Will. The leader's claim to embody the sovereign people acquires a specious plausibility."
This is extraordinarily harsh; Marquand is saying that New Labour constructs a "people" whose assent it manages to the deliberate destruction of intermediate institutions (some of which, like the Scots parliament, it has created). He is no less hard on the Third Way. He says that the one scholar of high reputation who has shown enthusiasm for the Third Way-Anthony Giddens, director of the LSE-had made a bad mistake in doing so: "I don't want to get into a tirade against Tony Giddens, whom I personally like very much; let me only say that I think his work on the Third Way is far below his own high standards.
"I think there was a lot of interesting debate in the late 1980s and early 1990s in reaction to Thatcherism. It was not Old Labour, it was trying to find a new form of social democracy or social liberalism, taking account of the changes in society. It was inchoate but fruitful-I am thinking of the work of the Dahrendorf Commission on Wealth Creation, of John Gray's writings on social democracy, of Will Hutton's book on stakeholding, The State We're In, which John Kay took on, of Gordon Borrie's report on Social Justice. This was a theme of intellectual inquiry which really was a Third Way; but the contemporary debate implies that Blair descended from heaven and everything that went before-all that work-is for the rubbish heap."
Philip Gould, the pollster whose attention to Labour's image makes him anathema to many intellectuals, would categorise Marquand and others with the "progressive elitists" who he believes have dominated the left for far too long. And New Labour has a series of defences against their attacks. One is that the Third Way, although unpopular with the British intelligentsia, runs well abroad. This is clearly true; Blair is by far the most popular European leader on the continent (and in the US); he is seen to embody something new and fresh. The new generation of centre-left leaders have set up a regular series of "Third Way summits" to talk through ideas. There is much self-congratulatory vacuity in the transcripts of these meetings. But the leaders-the Washington summit in April had Blair, Clinton, Schr?der, Massimo d'Alema of Italy and Wim Kok of the Netherlands-are all groping for a new political synthesis to meet common problems. Clinton expressed it thus: "The question that any political party that purports to represent ordinary citizens must answer is: how do you make the most of the possibilities of the global information economy and still preserve the social contract? What can governments do to help make sure that every responsible citizen has a chance to succeed in the global economy? And how can we discharge our responsibilities as leaders of wealthy countries, to put a human face on the global economy?"
Second, at least some New Labour ministers find the Third Way a useful political and intellectual tool. Calum MacDonald, who was until the last reshuffle the housing minister in the Scottish Office (a function now handled by the Scottish parliament), says: "I read Marquand and took a lot from him: he did a lot to help set out the terrain in the 1980s. But he doesn't tell me what to do as Scottish housing minister. For that I went to experts, many of them academics. They were crucial in turning my mind in new directions.
"But I always thought that the Third Way was what I was doing; I needed it as a kind of backbone to my actions. I was working at finding solutions to housing problems which were no longer relying on simple council ownership, but were not simply private. It was non-state, but collective. There was no script. To have an intellectual backdrop like the Third Way, even one not fully worked out, meant you could drive things through. It gave me intellectual bearings- otherwise it's easy to get lost in the minutiae and the safe ways to do things suggested by the civil service."
For Giddens, the Third Way is a framework for trying to think through the issues which globalisation thrusts into every sphere of life, even the most intimate-and the implications of this relentless pressure on social democratic values (Giddens insists that his version of the Third Way is social democratic). "Of course there must be more attention given to social justice-but the context within which you achieve it is changing. So you must try to modernise systems of social security and health in tune with the trends of the global economy. And you can get results; for example, inequality in the US is now starting to decline."
New Labour's dislike of the old approaches stems from the belief that most left intellectuals and nearly all academics do not understand what the stakes are, and do not grasp that without radical action, Britain will slip further and further behind the US. In an essay in Foreign Affairs in 1996, Joseph S Nye, Jr. and William Owens, respectively the dean of Harvard's Kennedy School and the former vice-chairman of the joint chiefs of staff, defined in three opening sentences the problem which faces every country except the US: "Knowledge more than ever before, is power. The one country that best can lead the information revolution will be more powerful than any other. For the foreseeable future, that country is the US."
Technologically, the US is where it is at. It is also where it is at in mass culture, science, social experimentation and high employment. Its stock market boom may end soon, but its economic strength is built on more than a rising stock market. The US is overpoweringly competent in the technologies which are shaping our societies. This is an article of faith for most New Labour thinkers. The issue of how to deal with knowledge is one of their core concerns and the main reason for their impatience with the Academy. Charles Leadbeater-whose 1999 book, Living on Thin Air, was endorsed on its dust jacket by the prime minister, by Peter Mandelson, by John Browne, chief executive of BP Amoco and by Rosabeth Moss Kanter of Harvard Business School-is a leader in the project of "wising up" New Labour and the government. Leadbeater is regarded by most of the Academy and the public intellectuals as far below the salt.
"I think that people like Marquand, Will Hutton and John Gray don't give credit to the enormous creative force of the knowledge economy. They also don't see its democratic aspect-everyone is involved, or getting involved in it. The task is to create institutions and systems to allow people to cope with this new economy-not to take them back to a comfortable world which intellectuals imagine existed," he says. In Living on Thin Air, Leadbeater dismisses more swathes of intellectuals-including Francis Fukuyama and the communitarian writer Amitai Etzioni-for having a backward-looking view of what constitutes trust, locating it in a "pre-modern account of trust in settled communities." Leadbeater sees trust as also existing in shallow relationships between, for example, a car repairer and his customer or a department store and consumers. He adds: "Too much trust can be bad for you. High-trust, long-term relationships do not always lead to improved efficiency." His model is no longer Sweden or Germany it is Silicon Valley: "the closest thing to an economy which is both innovative and open while being capable of generating high degrees of cooperation and trust."
Concentration on knowledge and its uses has displaced the search for a pact with the intelligentsia. David Halpern says that the failure of Nexus has seeded two different initiatives: the New Policy Network, run by Mark Leonard from the Foreign Policy Centre, which is a networking of Third Way-ers across Europe; and, more concretely, a sustained effort within the Cabinet Office to apply evidence, research and analysis to policy-making and governance. The project, still in its early stages, is being overseen by Ronald Amann, formerly the director of the Economic and Social Research Council. Halpern says: "It's a tricky thing to do. All government departments have their own policy networks, but there has to be some way of integrating them. The effort is to set up a kind of hub to do research into issues and get to understand the international dimension and experience. For example, if you want to sort out transport you get real evidence from other countries and apply that evidence to policy."
This work, if successful, will complete the replacement of the political intellectual-and a good thing too, New Labourites would say. But there is a lingering doubt; a kind of whisper along the corridors of power. It is the debate which has not happened-or has happened only in fits and starts. It is the old "ideal of material equality" which Hayek saw as so pernicious. It may have changed its spots in the past 50 years but it has not gone away. When Leadbeater commends Silicon Valley, he adds immediately that "it has a weak civic culture and it is a highly unequal society." He worries that his book is "perhaps a bit too Panglossian." The anonymous Downing Street aide says that "we won't be able to escape the inegalitarian consequences of policies," but then adds "nor should we." Matthew Taylor at IPPR says: "We must go back to the idea of what is a good society. The problem with some of New Labour is that it implies that you do not need to make trade-offs. It's hegemonic-we represent everybody-everyone who doesn't see that is an extremist. But intellectual endeavour is all about trade-offs." Taylor takes a bit of paper and draws a pyramid. At the base, he writes "reality"; at the apex, "values." In between, he says, "we have to put connecting rods. The job for intellectuals is to make the connections."
When I asked the Downing Street aide what work coming out of the think-tanks had been most useful to him, he replied: "The pamphlet on waste disposal from Demos." I thought for a moment he was joking, but he was wholly serious. Reading it, I saw what he meant: the author, Robin Murray, has in studying waste disposal produced ideas, a strategy, and a critique, not of the government's political philosophy, but of the way the administration works.
"Joining up government" is one of the big projects of New Labour: Amann's work in the cabinet office is part of it. It is a good example of the divide that has opened up between the thinking core of New Labour and the left intelligentsia and parts of the Academy. The first has ceased to find the old arguments about the economic/social base of interest. Accepting the macroeconomic consensus means accepting the inegalitarian outcomes as facts of life which can be alleviated for those at the bottom of the pile mainly by supply-side measures such as better education and fewer barriers to employment. The left intellectuals continue to insist that the structures of the base must change and that the gap between haves and have-nots, not merely the condition of the have-nots, remains at the heart of politics.
New Labour's big ideas are at the level of superstructure, not base. It wants to reinvent ways of doing things, including encouraging people to do things for themselves. It wants to help people grasp the implications of the knowledge economy. It believes that most intellectuals are of little value in this process-they no longer know how to think, do not understand the nature of media democracy and have not adjusted to the "end of history." For their part, the left intellectuals think that New Labour no longer knows what its values are-it has become an unappealing mix of media manipulation, policy detail and waffly futurism; a geopolitical fashion victim. In the third year of Tony Blair, the divide is widening.
