Medha Gupta British Politics First Draft Consensus The Rise and Fall of the Attlee Settlement Throughout

the British political history since 1945, one word has stood out as meaningful, especially for the twenty years it was enacted, consensus. It is a much usedsome would say abusedword in British Politics, it is an example of a term that originated outside party political discourse and then became absorbed into it.1 R. Heffernan argues that, at root, consensus politics reflect a dominant set of ideas, and that such ideas structure political and policy agendas in a variety of ways, most notably by diagnosing political and economic problems and prescribing policy solutions. By providing policy makers with a compass, not necessarily a road map, dominant ideas create the constraining framework that fashions consensus politics.2 The crux of consensus politics is a reflection of societal times, and provides a guiding tool for policy support, particularly when there is dissent in government. It does not tell policy makers what to do, but merely provides a way for them to create and enact policy that reflects this consensus and guide of the times. This term became part of the political vernacular after Paul Addisons book The Road to 1945 was published in 1975. Addison posited that since the First World War until 1975 there were two distinct periods in the 20th century. He labeled them respectively the Baldwin consensus, and the Attlee consensus. This did not mean that Stanley Baldwin and/or Clement Attlee singlehandedly created a set of Kavanagh, D., & Morris, P. (1989). Consensus Politics. Oxford, UK: Blackwell Publisher. 2 Heffernan, R. (2002). The Possible as the Art of Politics: Understanding Consensus Politics. Political Studies , 50 (4), 742-760.
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principles and strategies by which British Politics was organized; the ideas was rather that each symbolized and became the focus of a set of ideas and conventions about the nature and scope of politicaland particularly governmental activity. They represented, in other words, a set of governing assumptions and expectations.3 This reflects the initial definition of consensus politics, and serves to demonstrate the full repercussions of such a type of government. After World War II, Britain went through much financial hardship, and a very difficult transitory process filled with disquiet and chaos. The two major parties, Labour and Conservative were both divided around the idea of ownership, primarily property. In addition, there was a huge disparity in class structure that fraught society. Structural constraint theory is right to highlight limited elbow room, but overemphasizes economic determinants of policy, while undervaluing disagreement over ideas and sheer poor judgment. The nettle of Europe was just not grasped, and the foreign office failed to convince governments, and perhaps itself, of the death of the imperial and national economy. 4 Post-War consensus, the consensus espoused by that of the Attlee government, is a way of organizing the years of 1947-1951, and placing them into one economic category. This does not mean that Attlees own personal policies and belief system played a huge role, but it merely signifies the economic continuity adopted by the succeeding governments until the end of this time. So if the term consensus is to be used to describe significant aspects of British politics in the period after 1945, it is important to be clear about the sense in which Kavanagh, D., & Morris, P. (1989). Consensus Politics. Oxford, UK: Blackwell Publisher. 4 Butler, A. (1993). The end of post-war consensus: Reflections on the scholarly uses of political rhetoric. Political Quarterly , 64 (4), 435-447.
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the word is being employed. Broadly speaking, it is used in two senses, apart from the agreement on political institution and procedures.5 Keynesian theory, at large, is the central tenet of this consensus. Keynesian techniques of economic management reconciled political control over the economy with political freedom. This was the great choice of the inter-war yearsplanning versus freedom, both in the political and economic sectors. Keynes was the genius who reconciled freedom with planning, by curbing the risks and uncertainties of the market. As a tool of economic management Keynesianism lent itself to Labour and Conservative interpretations. And it worked. Large-scale unemployment disappeared from western societies for the 30 years after the war.6 There was a prevalence of state sponsored economies that were engendered by the Keynesian movement, particularly the creation of the welfare state. This economic model serves as an example of the economic continuity that the Attlee consensus adopted. Keynesian economics argues that decisions made in the private sector can lead to inefficient outcomes macro economically. Thus, the public sector usually responds to these actively including actions in monetary policy by the central bank and actions by fiscal policy by the government to stabilize output over business cycles. The Keynesian economic theory posits that a stable government should be run by a mixed economy, mostly in the private sector but the government and public sector should have a significant role. These ideas became accepted widely after the Second World War and up until the early 1970s. Butler, A. (1993). The end of post-war consensus: Reflections on the scholarly uses of political rhetoric. Political Quarterly , 64 (4), 435-447. 6 Kavanagh, D. (1985). Whatever Happened to Consensus Politics? Political Studies , 529-546.
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In 1944 Keynes warned Hayek, the economist, about the dangers that individual liberties faced posed by planning and collectivism. He wrote that it would be more secure if those carrying it out are rightly oriented in their own minds and hearts to the moral issue.7 Beveridge and Keynes both believed in the authority of the government and believed in the benevolence of the state served by the elite. They did not, by any means, desire any anti-authoritarian government to replace the power system. The upper level civil service officers who also supported the welfare state mainly supported Beveridge and Keynes. They both used this and formed a social democratic package, and formed a middle ground of government. It was neither, like the United States, free market capitalist, and it was also not completely socialist. This model of the economy succeeded for one major reason, the success of the British in the war. The government had taken an active role in society during the war, and since it was so successful, public opinion decreed this to be an important facet of the government. They believed that post-war, the government and society should be similarly guided. They also believed strongly that the cooperation by businesses and unions was absolutely necessary for the post-war British government. It is fair to claim that many of the ruling ideas on which the consensus rested were elitist. Like the Fabians, Beveridge and Keynes were paternalistic and technocratic, believing in the rule of expertise and the importance of basing policy on evidence and research.8 The policies were non-party based also, seeking to find a common ground between the Labour and the Conservatives, a way for both parties Kavanagh, D., & Morris, P. (1989). Consensus Politics. Oxford, UK: Blackwell Publisher. 8 Kavanagh, D., & Morris, P. (1989). Consensus Politics. Oxford, UK: Blackwell Publisher.
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to co-exist with one another, and it did not, in and of itself, lend to any particular partisanship. Policies, in this time, were forced to converge between multiple governments. Many different facets of the consensus attached to public opinion, and politicians feared that the electorate would not be happy with parties that moved too sharply from them. The middle ground was an idea developed by the consensus, which was accepted by the electorate. This tradition of making policy meant that any governmental party would have to listen and accommodate the claims brought forth by major businesses and trade unions. Another facet of these policies was the civil service; they would be allocated the same deference showed to businesses and trade unions. These policies also had a certain amount of interdependence, Full employment would ease the demands on the welfare budget and enhance the bargaining position of the unions; provision of welfare was a means of gaining trade union acceptance of wage restraint; state intervention in the economy was important as a means of regulating demand. The ideas of Keynes and Beveridge legitimized a large public sector, state spending, state provision of welfare and active government.9 The concept of having a close to zero percent unemployment rate was the driving factor of the economic model, and the idea was that it would help itself out, one thing would lead to another and the economy would basically run itself with the help of the government guiding where the money would go. Creation of jobs would lead to more spending which would lead to more money being

Kavanagh, D., & Morris, P. (1989). Consensus Politics. Oxford, UK: Blackwell Publisher.
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pumped into the economy which would then lead to creating jobs and thus the circle would continue. The Attlee consensus accepted this economic model and used it for the next few decades until the massive inflation hit in the 1970s and this policy had to be revoked. The Attlee settlement covers the first formative period of British Politics from 1945-1951, the period of the first majority Labour Governments. In the first periodthe main planks of what has been called the post-war political consensus were laid down. That period has been seen in the history books as representing the triumph of collectivist ideas and of the Labour Party and the working class identified with them.10 In sum, the Attlee governments believed strongly that a transformation of society was necessary if they ever wanted to eradicate poverty. They wanted, more than anything else, to redistribute part of this strategy. They believed, for themselves, that poverty was not actually a technical problem that could be ameliorated simply by administrative reforms. Rather, it was seen as an inevitable outcome of the operation on an intrinsically unfair economic and social system. Accordingly, the best solution to this and all problems afflicting the nation was the creation of a socialist society.11 The two parties did not disagree on much. They only disagreed on the why and the how of state sponsored activities and their managing, but they both agreed that the state should control then. All of the governments then agreed that a level of management was not only desirable, but also necessary. They also agreed that Kavanagh, D., & Morris, P. (1989). Consensus Politics. Oxford, UK: Blackwell Publisher. 11 Kavanagh, D., & Morris, P. (1989). Consensus Politics. Oxford, UK: Blackwell Publisher.
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government to some extent should own industry, but it is here that the disagreements become more noticeable. The Labour party argued that the government should hold more control over these state sponsored activities, while Conservatives did not believe that the government should have as much.12 This period was also very important because it led to the founding of the tenets of the Labour party and collectivism. The Labour party of the Attlee consensus believed in several things: the mixed economy, full employment, conciliation of the trade unions, welfare, and the retreat from empire. The mixed economy refers to the ownership that the public sector and the private sector controls. The public sector owns and maintains basic utilities and the government has an active role in managing the economy in pursuit of certain social and economic objectives.13 Basically the state would hold control over a certain number of industries, and the rest of the economy would follow certain guidelines that were laid down by the government. This active role of the state, as I mentioned earlier, was the result of immense success during the war. Full employment refers to the government trying to run the economy at a very low unemployment level; the only ones left unemployed would be students and those who are unhirable. In line with Keynesian ideas, In line with Keynesian ideas, governments accepted the duty of managing demand as a means of producing full employment. The policy succeeded. Compared to the double digit unemployment figures of the 1930s, the level did not exceed an average of 3 per cent in any full year Butler, A. (1993). The end of post-war consensus: Reflections on the scholarly uses of political rhetoric. Political Quarterly , 64 (4), 435-447. 13 Kavanagh, D., & Morris, P. (1989). Consensus Politics. Oxford, UK: Blackwell Publisher.
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between 1948 and 1970.14 This, in turn, would provide the economy with more money, while creating the circular structure of the economy. The conciliation of the trade unions was an important factor, because since the Labour party was so focused on labor and unions, and their target constituency was the working class, it was unbelievably important to appease them and make sure that they can work with the government. Appeasement would also lead to an easier time for the government to create jobs. Trade unions were accepted as an estate of the realm in wartime, not least because their cooperation was required for the war effort. After the war their bargaining position was helped by full employment and the enhanced consultative status they were granted by Labour and then by succeeding Conservative governments.15 The emergence of the welfare state was linked to the Beveridge report [in] 1942 on Social Insurance and Allied Services. This proposed that existing schemes of welfare support be consolidated to provide a universal national scheme. In 1945 and 1946 legislation provided for family allowances, sickness benefits, and national assistance. In 1948 the national Health Service was established to provide treatment free, as of right.16 This is a particularly important tenet of the Attlee consensus, as it is one of the prevailing components of the British government even today. The National Health Service throughout the Kingdom is a very important component of

Kavanagh, D., & Morris, P. (1989). Consensus Politics. Oxford, UK: Blackwell Publisher. 15 Kavanagh, D., & Morris, P. (1989). Consensus Politics. Oxford, UK: Blackwell Publisher. 16 Kavanagh, D., & Morris, P. (1989). Consensus Politics. Oxford, UK: Blackwell Publisher.
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the government and absolutely demonstrated the capabilities of the Keynesian model of economics. Britains role as a nuclear power and the subsequent membership of the Atlantic Alliance was a key part of the government. At the end of the war Britain was the only imperial and West European state with the status of a world power. Between 1945 and 1951 the Labour Government began a process of disengagement from empire, starting with the grant of independence to India and Pakistan in 1947, and promoted the idea of the Commonwealth, an association of equal states. It also helped to create the American-led Atlantic Alliance and started to develop at independent nuclear deterrent. Membership of European economic and political institutions was not at this time on the political agenda but became so in the 1960s. Questions of defense posture and possible membership of the new European Community caused significant diversion in the Labour Party and, to a lesser degree, within the Conservatives. Yet these questions did not, apart from the period of Hugh Gaitskill's leadership of the Labour Party, cause difficulties for the leadership of either party.17 These policy goals formed a social democracy, as mentioned earlier, it did not go to either extreme, but merely served as a guide, or a compass for government to help society realize its full potential.

Kavanagh, D., & Morris, P. (1989). Consensus Politics. Oxford, UK: Blackwell Publisher.
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The decline of the Attlee consensus was the result of a terrible economy in the 1970s where inflation was high, and to make anything work, the pound had to be consistently devalued. At one point, there was a slow moving economic and political decline, and it is hard to pinpoint exactly where this occurred. There was a growing awareness of Britains loss of international influence, reflected in the Suez fiasco in 1956 and in the application to join the European Community in 1961. There was also awareness that other West European states were achieving much faster rates of economic growth18 These events gradually led to confidence being lost in the Attlee consensus, and pretty soon, there was a desire to change models, as unfortunately, the Keynesian model was broken and would no longer work. Gradually the stroke of ideas and policies identified with the post-war consensus came to be regarded as part of the problem. From being the exemplar of stable representative democracy, indeed the exporter of institutions, Britain was widely regarded as a country on the verge of political breakdown, and pretty soon, a new government would have to come in its place.19 In 1979, Margaret Thatcher came into power, and decided to change everything around. In 1981, amidst allegations made by Edward Heath, that she was abandoning consensus said, for me, consensus seems to be the process of abandoning all beliefs, principles, values and policies. Her negative reaction to the word consensus can be attributed to the fact that the consensus mainly protected values that she wanted to get rid of and move Kavanagh, D. (1985). Whatever Happened to Consensus Politics? Political Studies , 529-546. 19 Fry, G. K. (1984). THE DEVELOPMENT OF THE THATCHER GOVERNMENT'S 'GRAND STRATEGY' FOR THE CIVIL SERVICE: A PUBLIC POLICY PERSPECTIVE. Public Administration , 62 (3), 322-225.
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along from.20 She had inherited a government that had a civil service that was highly unionized, where the non-industrial part had grown exponentially during the Keynesian era, and where the Civil Service department actually ended up having its own central personnel department presiding over arrangements, whereby civil servants, while normally enjoying security of tenure, in principle had their salary scales primarily based on 'fair comparisons' with outside pay, together with indexlinked pensions. With inflation rampant and with unemployment rising too, and in a political context in which 'where will the money come from?' was once again a pertinent question to ask, what were seen as the service's cozy pay and promotion system and privileges were bound to be targets for an 'economizing' Government.21 She brought about the second era of change resulting because of a collapsing model of government. She dismissed much of the Attlee consensus, and this new government actually ended up bringing ideas to the free market. Mrs. Thatcher was the first party leader to campaign on a platform of breaking with both aspects of the post-war consensus policy style and particular policies. Her administrations have produced something of a revolution not only in British politics but also in the Conservative Party. She has frequently attacked the consensus and identified it with shabby compromises or ducking necessary tough decisions. She knows, of course, that the term has become a code word used by those criticizing herself. But she also wishes to make her own ideas prevail; the collectivist, egalitarian values of 1945 Kavanagh, D. (1985). Whatever Happened to Consensus Politics? Political Studies , 529-546. 21 Fry, G. K. (1984). THE DEVELOPMENT OF THE THATCHER GOVERNMENT'S 'GRAND STRATEGY' FOR THE CIVIL SERVICE: A PUBLIC POLICY PERSPECTIVE. Public Administration , 62 (3), 322-225.
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should be replaced by those of individualism and freedom. She prepared a speech where she compared herself with biblical prophets of the Old testament, and she asserted that they did not say Brothers, I want a consensus. They said: This is my faith. This is what I passionately believe. If you believe it too, then come with me.22 She viewed Political convictions and principles as inconsistent with a consensus style of governing. While there was a post war consensus that was remarkably important, there were also several limitations of the agreement and continuity with this form of government, which became evident as the circular model stopped working. Since the consensus model is so intricate to begin with, if any one thing stops working, the entire system falls apart. While there were many things that did survive past the accepted time frame of the Attlee Consensus, the collectivism and the Keynesian model that it espoused, unfortunately did not manage to survive. Regardless of the global economic recession, it still probably would not have survived as it was so fragile and depended on so much to begin with.

Kavanagh, D., & Morris, P. (1989). Consensus Politics. Oxford, UK: Blackwell Publisher.
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Bibliography Butler, A. (1993). The end of post-war consensus: Reflections on the scholarly uses of political rhetoric. Political Quarterly , 64 (4), 435-447. Fry, G. K. (1984). THE DEVELOPMENT OF THE THATCHER GOVERNMENT'S 'GRAND STRATEGY' FOR THE CIVIL SERVICE: A PUBLIC POLICY PERSPECTIVE. Public Administration , 62 (3), 322-225. Heffernan, R. (2002). The Possible as the Art of Politics: Understanding Consensus Politics. Political Studies , 50 (4), 742-760. Kavanagh, D. (1985). Whatever Happened to Consensus Politics? Political Studies , 529-546. Kavanagh, D., & Morris, P. (1989). Consensus Politics. Oxford, UK: Blackwell Publisher. Page, R. M. (2008). Towards a 'red' and pleasant land? The attack on poverty and the pursuit of social justice in the Attlee era, 1945-51. Benefits: The Journal of Poverty and Social Justice , 16 (2), 133-142.