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THE PARADOXES OF POWER Reviewed by Rodney Atkinson Sir Alfred Shermans' book The Paradoxes of Power is both inspiring and depressing. Inspiring because he does not put a foot wrong in his lucid exposition of that powerful synthesis of British Conservative philosophy and classical liberal economics which produced from his pen crystal clear policy advice to the embryo Thatcher regime in the 1970s and the early years of Government in the1980s. Depressing because, as he rightly asserts, in many ways we are back where we started, as a new sclerosis of growing Statism, corporatism and eurofederalism are once again eating away at individual freedom, economic prosperity, democracy and British constitutional sovereignty. As Sherman writes in his introduction he saw Margaret Thatcher's "stint as party leader and Prime Minister as an interlude because what followed was largely a return to what had gone before". Needless to say this reverse is due at least as much to the disastrous Major/Clarke/Heseltine period as to the Blair regime! Although the book was written before the new leader of the Conservative Party emerged at the end of 2005, Sherman is, I know, as worried as other Conservatives that David Cameron (appointing Clarke, Gummer and other corporatists and crypto social democats to leading positions in policy formation) has not learned the lessons of the post Thatcher collapse. "By turning their backs on her, Conservatives cut themselves off from their own history" he writes. Indeed I would suggest the position is even more serious electorally because the millions of voters who sustained Margaret Thatcher came from all classes and all parties and none because she understood how to put into "words on the street" the philosophical and policy insights of Sherman, Joseph and others. It was she who attracted the massed ranks of the Conservative working class, the skilled, the entrepreneurs, the shopkeepers and the housewife who have always made up the vast majority of the Conservative vote and who can see in the pseudo intellectual corporatists and technocrats (at best) nothing and (at worst) the opposite of Conservatism. As Lord Tebbit writes in the preface to the book "None of us were simply economic liberals and Sherman is emphatic that family and civilised values are the foundation on which the nation and its economy are built." Sherman himself wrote for a Keith Joseph speech: "Our party is older than capitalism, our area of concern is the whole of public life". It is of course those very values which in the past attracted the British people, regardless of class, to Conservatism and why those like Kenneth Clarke who attack tradition, nationhood, sovereignty and "right wing policies" are not Conservatives at all. They chose Conservatism as a personal professional vehicle - and a vehicle whose natural direction they are more likely to frustrate from within. For Conservatism is not about left or right wing ideas but about freedom, the individual, families, communities, the rule of law, entrepeneurial capital and, above all, nationhood. Those who value these organic structures of society require therefore no authoritarian structures of the State with its corporatist bureaucratic top down elites. That is why Conservatives are on the left of politics, challenging centralised and supranational power structures - as the left challenged the once almighty monarch. The dirigistes and corporatists who captured the Conservative Party under Heath and Major (and are back in power today) are of course on the extreme right. The characters of Sir Alfred Sherman and Margaret Thatcher and their personal backgrounds were, to my mind, as critical in their development of successful policies as were their intellects. Sherman rightly admires the success of a lady who "…without family connections, oratorical
skills, intellectual standing or Equally Sherman himself, born of modest circumstances to a Jewish family in the East End of London went to a state school in Hackney, not a public school in the shires! He was also an outsider, not least because his superb intellect was nurtured by the rigour of his critical Marxist studies and a wide experience of European history and languages (he fought in the Spanish civil war, speaks fluent Spanish and is a Balkans expert). During the Second World War he learned Arabic and gained "useful insights into the Moslem mind set". This erudite internationalism did not sit easily in a Conservative Party where who you were was paramount and where a common sense reality was the only philosophy! It is interesting in this context to read Sherman's grounds for rejecting Marxism - firstly that the Communist dream was "a self-deception beyond repair" and secondly that "socio-economic processes had an autonomy of their own which could be influenced…………but only within the limits set by the nature of the social process". No wonder Sherman arrived at British Conservatism. He could never have embraced the corporatist Conservatism of continental Europe, nor the "third way" intellectual bankruptcy of British Liberals, Social Democrats or Labour Fabians. The third of the ground breaking triumvirate, the perpetually agonising Sir Keith Joseph, was also not of the city or the civil service or landed gentry but of a highly successful entrepreneurial family from Leeds (Bovis). Nevertheless he was educated at Harrow and Oxford and politics for him "was not a career but a vocation" writes Sherman. Sherman was allied to Joseph from the late 1960s and encouraged his "kicking over the traces" but he later regretted that Joseph too easily fell victim to the civil service and vested interests when radical political change was necessary. Sherman notes that after election victory in 1970 Joseph initially "returned to the bosom of party orthodoxy. Our meetings slowed to a halt". Nevertheless Joseph recognised that he himself only really became a Conservative in 1974! (Collection of Speeches called Reversing the Trend) not least due to his acknowledgment of "Alfred Sherman's economic education of me"! (He should have perhaps written "philosophical-economic education of me" for Sherman's economic insights arise out of his philosophical erudition). It was these three "outsiders" who (with the IEA, Adam Smith Institute and a minority of us in the Conservative Bow Group) sought to teach the Conservative Party, (the party led by the shires, the land owners and the leading financial families) the virtues of free enterprise, economic change, competition and the wisdom of the market place. By emphasising such liberal pillars in place of the dirigisme of "the right kind of chap" the fundamental decency of Conservative virtues was not to be abandoned. Since the demise of the old Liberal Party, the great successful synthesis in British party politics was the fusion of the Conservative values of family stability, property rights, personal morality and the defence of the realm with the Liberal virtues of individualism, free trade, entrepreneurship and social emancipation (as opposed to social control!). The great leaps forward for the Conservative Party have accompanied the embrace of the Liberal virtues - but firmly based on solid social Conservatism. It was Margaret Thatcher, guided by the wise Alfred Sherman, who was responsible for their greatest leap forward in the 20th century. Indeed so powerful was that combination that it propelled Prime Minister Blair's into the 21st century. In other words for Conservatives the "change" and the "modernising" which worked was the Thatcher revolution and the attempts today to dress up a return to its opposite as "change" and "modernising" are doomed to abject failure. Those who embrace what I call the Portillo Fallacy (that the Conservative Party can combine economic liberalism with social liberalism and still gain Conservative votes) should join the social democrats for Conservatives they certainly are not. Such logic has already broken up the Conservative Classical Liberal synthesis, for liberals would shrink from their illogical combination of social licence and State authoritariansim. Indeed we see daily on the streets of Britain (as alcohol and drug fuelled licence are countered by big brother cameras and a politicised police force) that social licence and State authoritarianism are mutually dependent characteristics of a decadent society. It is David Cameron's assertion (supported as he is by those very politicians - Major, Heseltine, Clarke, Dorrell, Curry, Gummer etc who led the Party to its greatest defeat in 100 years) that Thatcherite Conservatism is no longer relevant (or at least no longer critical). But Sherman rightly asserts that: Thatcherism appears to have runs its course, though Indeed reading of Sherman's incisive analyses and policy prescriptions of the 1970s and 1980s it is quite clear that the job was at best half accomplished and even that which was accomplished has been considerably undone, partly by Majorite weakness partly by Blairite Statism - but under both regimes by an alien continental corporatism. Sherman even questions the extent of the Thatcherite revolution when he points out that in 1955 the State accounted for 25% of GDP while even after 18 years of Thatcherite market economics in 1997 the proportion stood at 40%. "There are probably still more Marxists in Oxford
than in Moscow, The State sector has indeed survived to continue its dominance, having replaced its spending on loss making nationalised industries with increased spending on wasteful State education and the ludicrous nationalised sickness service. The State (Fabian socialists and Blairites have recognised) can have far more power by manipulating private companies, taxing individuals, regulating industry and passing the costs of regulation onto the regulated (rather than raising overt taxes to pay for it). They also recognised that in legislating for the politically correct and intimidating their opponents with (highly selective) "discrimination" laws opposition could be muted. And how useful to have socialist and corporatist power enter through the back door of the European Commission's dictats, regulation and the European Court. And how much better to register the unemployed as being State employees (up 800,000 since 1997) where State propaganda can more easily categorise the useless as useful. "National and Religious questions" writes Sherman "transcend economics as major historical forces…These lessons have been comprehensively unlearned. Conservatives shirked such questions". Today we see the consequences as Muslims carry banners in London calling for the beheading, massacre and annihilation of "Infidels" and praising the London and New York bombers while the Conservative Party sees no logical end to mass immigration. The logical consequence of mass immigration is of course colonisation, not integration but the Conservative Party today sees immigration as a means of serving the perceived need of British corporations for more labour. In other words the corporatist need is greater than the national interest. No wonder the Conservative Party signed away democratic nationhood at Rome and Maastricht and is today unelectable. In the early Thatcher years it was indeed Alfred Sherman who saw more clearly than anyone that a fundamental cause of Conservative decline was that: "In the post war period what was left of Christianity
was appropriated by He persuaded Margaret Thatcher to take a stand, but he was disappointed with the lack of press and political follow up. "Blair eventually exploited the vacuum, but he did not fill it" Sherman remarks. As I noted at the outset Paradoxes of Power is depressing for the Conservative intelligentsia because even when a radical Government gained power in 1979 with cross party support in the country and a clear task to perform, so little was achieved. The quality of the average Minister was massively lower than the best and many Ministers either sabotaged Conservatism or were too weak either intellectually or in personality to oppose and win against the parasitic State and its empire. Like other classic civil service compromises between socialism and freedom the Stalinist NHS was endowed with a new pseudo managerial tear of bureaucrats - they are with us still, some 36 yeas later. "Other parts of the empire ran on as before, expanding the welfariat and its shepherds" notes Sherman. As someone who was writing much political economy of a classical liberal and Conservative nature during the 1980s and occasionally advising ministers I am struck by how similar my analyses outside Government were mirrored by Sherman who was far more on the inside. His warnings about Joseph using the word "social market" - "a German neologism which meant everything and hence nothing" was of course a warning against the corporatist form of Conservatism so beloved of continental Christian Democrats. I think it was Arthur Seldon the co founder with Ralph Harris of the IEA who remarked that if you put the word "social" before any idea it negated it. A social market is not a market, social justice is not justice and most things "social" serve the politician and the State, not the individual and society. The joy of reading Paradoxes of Power is the historical and philosophical depth of Alfred Sherman's analysis of even the most pragmatic political issue. On the inexorable growth of State spending: "The growth of State expenditure in Britain actually owes little to socialists. Lloyd George and his allies played a major part in it. Like Bismarck…they saw statism as an instrument for progress and an expedient for taking the wind out of socialist sails, unaware that its ultimate effect could turn out to be the exact opposite. Karl Marx had no illusions about the state as oppressor (but)….. Marxists Leninists ignored it with disastrous results" This was also the dangerous role played by Keynesians who like Marxists took the supposed nostrums of their role model and turned it into something different. On State education Sherman has another continental allusion: (it) dates back to the 1860s and owed its inspiration
to Prussia (in line with The Conservatives and Labour Parties shared 97% of the votes between them in the 1950 general election and 75% in 1974. In 2005 it was some 45%. As Sherman points out the one consistent process since 1945 has been the growth of the State and the increased power of politicians, who in turn have become less and less qualified by experience in the real world. Sherman has rightly had much to say, as an ideas man outside Government, about the civil service. He notes how Keith Joseph was so often defeated by them (shipbuilding and Education being two examples) and notes how a few brave advisers (he mentions the Labour adviser to Wilson and Callaghan, Lord Donoughue) had tried to stop the "revolving door" whereby civil servants and ministers would retire and work for the companies they had previously dealt with in Government. With the examples of Peter Walker at British Gas and David Mellor at the BBC I myself eventually succeeded in persuading the Committee on Standards in Public Life that the concept of "contingent corruption" should be accepted as a problem. In other words just because there was a delay between a civil servant or minister rendering a service when in office and receiving payment or position after leaving Government did not detract from its unacceptability. Sherman rightly suggests that the 19th century Northcote Parkinson reforms of the civil service "created a professional civil service appointed through competitive examination…creating a caste insulated from the values and concerns of professional communities, generating its own…modus operandi". In fact today we have created another layer of State paid civil servants - called politicians - of whom the same could be said. This might explain Sherman's remark: "Conservative Ministers are traditionally passive
and leave their civil If this is the case for Conservatives how more compliant are socialists in the obedience to the State which they so admire and which has given them such personal largesse. Democracy will only have a chance when democratic representatives have the same lives - and therefore the same interests - as those they claim to represent. What strikes one about Sherman's discussion of the targeted frustration and sabotage of the Thatcher revolution from within the Tory Party was the ubiquitous Chris Patten and at various stages, Michael Portillo. As a typically Catholic continental corporatist, Patten would have been more at home with Shirley Williams in the SPD than with Conservatives in the Conservative Party (except that the latter offered a more remunerative career). Patten's speeches as a European Union Commissioner to the European Parliament had a sneering anti-British tone rather at odds with his Privy Council Oath of Allegiance but totally compatible with his Axis Powers audience. No wonder the Conservative Research Department under Patten was always at daggers drawn with real Conservatism at the Centre for Policy Studies. Michael Portillo ("I feel more than half Spanish") also seemed a political outsider: "..Portillo was actively engaged in Patten's anti-Thatcherism before his subsequent evolutions, first to enthusiastic ultra-Thatcherism then to "inclusivity" and finally internal opposition under William Hague and Iain Duncan Smith." Although Portillo seemed to be making a last minute extravagant gesture of support to Margaret Thatcher on the eve of her downfall he was as responsible as any for her predicament since, as a junior minister under Heseltine, he promoted the "Community Charge" or Poll Tax as it became known, despite being warned in detail by this author of its fundamental structural flaws (ie not distinguishing between redistributive taxes and charges for local services). There is hardly a succinct Sherman analysis of political economic significance from the 1970s to the 1990s which was not attacked by the all party Establishment and the Chris Patten/Shirley Williams corporatists - but which was eventually vindicated. From the subsidies for the coal and steel industries to the mass immigrations occasioned by subsidising the textile industry to the Poll Tax, British Leyland or the Tory nationalisation of the shipbuilding industry, from the bureaucratisation of the NHS to the sabotaging of a true Conservative education policy. Some of these lessons have been apparently learned but so many disastrous policies are returning under new guises. "Politics generally lags behind life" writes Sherman. Equally apt for his thesis that a democratic and progressive interlude is now followed by a longer period of decline might be summed in up Santayana's dictum that "those who forget history are condemned to re-live it". To take one example: "The intellectual quality of the Robbins report (1963) may be judged by its thesis that the success of the Soviet economy could be explained primarily by the number of graduates at a time when Soviet economic failure was manifest to all true believers" And yet here we are 43 years later (after the collapse of the Soviet Union, the recognition of the intellectual bankruptcy of communism and the failure of the state in western democracies to deliver either social or economic prosperity) with a Blairite Government promoting a production line system of higher education with a State "target" of 50% of school leavers becoming graduates. Even the Cameron Conservative Party will not allow the supremely successful grammar school model to flourish and expand and insists that "State" services, including education, are "Public" services. Sherman notes that the classical liberal/Conservative "counter revolution" of the 1970s and 1980s required intellectual "revolutionaries" "but the Conservative MPs, grandees, grey suits and organisation men were far from revolutionary" - indeed they were equally far from being intellectuals, even those with first class minds. But like a persistent but tiny minority of Conservatives have recognised for a long time Sherman rightly pinpoints the professional politician, the consultant and the PR functionaries as the new driving force in the British political class: "Loyalty was replaced by self interested calculation". "Often these individuals began as student politicians
and progressed as Ironically this massive injection of State financed "professionalism" into the body politic (completely contradicting the purpose of democracy as a challenge to the State) was not matched in the Tory Party by a professional approach to finding, paying and retaining the best advisers. Sir Alfred was poorly treated, working for long hours, often unremunerated, in a basement office until he, literally, at length emerged into the light! That other great intellectual contributor to Thatcherite success, Sir Alan Walters, was forced to return to his employer in the United States in order to secure his pension, leaving the Prime Minister undefended against the corporatist and monetary machinations of Lawson and Major's disastrous experiments with "shadowing the Deutschmark" (inflation out of control) and the ERM (unemployment 3 million). How much cheaper for the country or the Tory Party to have given Sir Alan a generous pension and saved us the consequences of his absence. Without Sir Alfred Sherman the "Thatcher interlude" would not have been so successful - and Brown and Blair would not have had for so long the resources to fritter away nor the rational structures to ossify. So what of the Blair-Brown future? Sherman sees Blair as "lacking both ideas and beliefs…his telegenic image may have swung votes but he has not changed minds…his actions have accelerated a loss of trust between the public and political leaders" As a result Sherman sees the public mood as "defensive, plebeian, anti-authority yet authoritarian". Blair seems to recognise this by his emphasis on education and "respect" but no one has contributed more than he to the creation of the society which he recognises as dangerous and the polity which is powerless to reform it. And surely few analysts predicted the consequences of Conservative and Labour failure more accurately than Sir Alfred Sherman, as all parties abandon the principles of that supremely successful "interlude" of which he was a chief architect. Rodney Atkinson
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