This meeting of the Forum set out to examine the key aspects of the Liberal Party's relationship with the trade unions. The first paper by Dr Alastair Reid, Fellow of Girton College, Cambridge and Visiting Professor of History and Policy at King's College London, revisited the years when the Liberals and the unions worked closely together. The second paper focusing on the contemporary Liberal Party/trade union relationship, was given by Baroness Susan Kramer, formerly Liberal MP for Richmond Park and Shadow Transport Secretary.
Dr Alastair Reid
Alastair began by recalling that when Billy Hayes talked about the Labour Party and the unions at a previous meeting of the Forum, he said that the New Labour 'project' had seen the problem of the 20th century in terms of a split between the Labour Party and the Liberal Party allowing Conservative domination of government; and had seen the answer as building a closer political alliance between Labour and the Liberals by removing trade unions from the equation. He tended to agree with this definition of the problem, but had long thought the answer was to bring Labour and the Liberals together around an enthusiasm for trade unionism. Given the wide gap there has been between the unions and the Liberal Party since 1945, this may sound absurd, so he wanted to go back to the late-19th and early-20th centuries when the links had been much closer to explore how that could have happened.
To talk of close links between trade unions and the Liberal Party in the late-19th century is not new, but until recently most historians have assumed that this was a big mistake on the part of the unions. Sidney and Beatrice Webb, the Fabian Society intellectuals, for example, argued that the Liberals showed their true nature by failing to reform union law adequately in 1871 and then refusing to improve it despite sustained trade union pressure. Meanwhile, although the unions objected to this particular failing, their demands for land ownership, home ownership and self-governing workshops indicated their broader conversion to 'the economic Individualism which at this time dominated the Liberal Party' and thus their capitulation to 'middle-class views' (History of Trade Unionism (1894), 1911 edn p.354-5), whereas for the Webbs, of course, the only genuine 'working-class view' would have been the collective ownership of the means of production under the control of a scientifically-informed central state. In Alastair's view, the Webbs were 'Clause IV socialists', and their views about what others were doing are coming to be seen as remarkably dogmatic.
Thus, on the first of these key points, historians would generally now agree that the main problem the unions faced under the law at the time was not the inadequacy of Liberal governments but the stubborn insistence of the common law judges on bringing legal concepts designed for quite different purposes into labour law cases. When the Liberals' 1871 legislation attempted to prevent this, and also to protect union funds and permit peaceful picketing, the judges simply continued to behave as if the new statutes did not exist. The ensuing trade union campaign of pressure came to fruition after a surprise election victory of the Conservatives with Disraeli as Prime Minister, so, as the government of the day, they often got the credit for the improved legislation of 1875. However, more careful research has revealed that the key clauses in the Conservative act were a result of Liberal amendments, especially from Robert Lowe MP and A. J. Mundella MP. So the Webbs' account of this issue was profoundly misleading: relations between the unions and the Liberals were not always smooth, but the unions usually got what they wanted in the end and, just as in the case of the Labour Party a hundred years later, had good reason to regard the Liberal Party of the time as 'their' party.
On the second of these key points, it is important to appreciate that British liberalism was ceasing to be based on individualist assumptions at the very time the Webbs were writing. It is true that liberalism had originated in the seventeenth century as a reaction against the 'divine right of kings' by arguing for what might be called the 'divine rights of the individual', though these were more usually phrased in terms of 'natural rights', seen for example in such notable thinkers as John Locke. But even for those sympathetic to the aims of liberalism this began to seem rather abstract, as the origin of these rights could not be observed. So there began, particularly under the influence of David Hume and other Scottish sceptics, a more historical approach culminating in John Stuart Mill's argument in On Liberty that the justification for individual freedom was that it was useful to society: societies without diversity and individuality could be seen to stagnate. So then the focus was not on 'the rights of the individual' but on a utilitarian assessment of 'what is useful' and 'what works' for the majority. Moreover, at around the same time, ideas were being introduced from continental Europe about the importance of voluntary associations as intermediate institutions between individuals and the state. French liberal thinkers, long confronted with a very strong central state, were keen to strengthen checks and balances against it, and Tocqueville saw the voluntary associations springing up in modern urban society as a valuable new addition to the repertoire: resisting or even replacing state intervention. German thinkers, not always liberals, confronted with the absence of any unified political authority, were keen to build up a national culture, and Hegel saw intermediate institutions as a valuable new forum for the education of individuals into a broader understanding of their interdependence with others: making a vital contribution to their willingness to consider themselves as citizens of a larger state. So by the late-nineteenth century, liberal thought had not only moved on to a new foundation in collective concerns but was even developing some very strong arguments which could be used to give a particular importance to trade unions. Alastair emphasised, then, that the evolving nature of liberalism was misrepresented by many leading socialist intellectuals at that time.
British trade unionists were not misguided, then, in finding the Liberal Party a useful ally over key issues of labour law and also in finding the tradition of liberal political thought a congenial one for representing their own interests. This produced a strong 'popular liberal' or 'radical liberal' tradition which continued into the early years of the Labour Party, some of the characteristic features of which may still be suggestive for policy makers today.
One of the key features of this tradition was its opposition between the productive classes who created real wealth and the parasites who creamed off a surplus through unearned income. Thus though the craft unions' clashed with their employers in such areas as the Clyde, Tyne and Wear and struck over pay and conditions, these would have been viewed by Liberal trade unionists as 'local difficulties' in comparison with the gulf between both sides in industry on the one hand and the parasitic landlords and bankers on the other. The most long-standing targets were, of course, landlords who came to the fore once again during the First World War when escalating food prices were seen as bringing them excessive profits and the reform of land ownership came back to the centre of the radical agenda: with municipal farms, cooperative farms and small holdings the preferred model, rather than nationalisation. This was linked closely with ideas about cooperative wholesale and retail societies as the main means of distribution, and as a result Labour's first manifesto as a fully independent party in 1918 revolved around a democratic foreign policy and land reform, and its ideal social order was frequently referred to as 'the Cooperative Commonwealth'. Then, in the interwar years, the focus switched to another long-standing target, the banks, owned by the 'finance kings' and 'money lords' who were seen as making excessive profits from uncertainty, market fluctuations and financial panics. Thus when a craft unionist such as John Hill, a national leader of the Boilermakers and an active member not only of the Labour Party but also of the Independent Labour Party, talked about 'capitalism', he meant not industrial employers but bankers, and he proposed in his annual report to his members for 1930 that: 'labour and management must change the system, and instead of being the tools of finance, they must become the hirers of capital.'
Another key feature of this tradition was its emphasis on non-interventionism and the devolution of decision making to the lowest possible level. In domestic policy this led to an opposition to any government interference in industrial relations and a preference for strong trade unions looking after their own interests in adversarial bargaining with their employers. Liberal-Labour opposition in the 1890s to such socialist demands as the statutory eight-hour day and the nationalisation of industry was not the product of satisfaction with the status quo, but rather of a different strategy for change: above all through local restrictions on the supply of skilled labour to keep up wages and build up independent bargaining power. In foreign policy it led to a consistent opposition to intervention in the affairs of other peoples even in the name of promoting liberty and democracy: for these could only come about through action from below, while military intervention would be likely to kill far more members of the ordinary population than it would autocrats. John Hill was a strong opponent of WW1 and of militarists like Lord Milner who were more intent on taking liberty away in Britain rather than giving it to Germany. For, as a result of long experience, these British labour radicals clearly understood that military action abroad was usually associated with restrictions on liberty at home, with citizens' rights and trade unionists' rights being constantly eroded in the name of democracy and freedom.
From this brief outline it can be seen that the liberal strand in trade-union politics continued long after the replacement of the Liberals by Labour as the main progressive party, and it still has many significant echoes today. Alastair hoped that bringing out the roots and the characteristics of this tradition more systematically and placing specific demands in a longer intellectual tradition would help both with Labour's ongoing search for a clearer identity and with the exploration of possible areas of cooperation between Labour and the Liberals in the future.
Discussion
There followed a lively and far-reaching discussion.
The first contributor was critical, arguing that the account of the Webbs caricatured them as Marxists; emphasising that most of the large manufacturing employers were hostile to trade unions; insisting that the Liberal Party of the period was unsympathetic to trade union rights; and suggesting that the growing role of the state in the early-twentieth century was positive for the unions and was seen by many of them to be so.
However, others were more persuaded by Alastair's case. One contributor supported his account of the Webbs' position. Both their History of Trade Unions and Industrial Democracy favoured a centralist approach to regulating industrial relations and the provision of welfare benefits. The Webbs were not into 'civil society', seeing it as a bad substitute for the state; for their priority in an era of catastrophic poverty was with outcomes rather than processes, i.e. to raise the standards of the lowest paid.
Another contributor thought the paper did give us pause for thought about the interplay of Liberal, Labour and trade union philosophies. The Taff Vale judgement of 1901 may be said to have triggered the wholesale union switch to funding the Labour Representation Committee, enabling a strong contingent of Labour MPs to emerge which championed the unions' demand for restoration of their legal protections. However, it was a majority Liberal government which passed the historic Trade Disputes Act 1906, suggesting a serious regard for trade union demands. Meanwhile, the Miners' Federation, with a dozen or so sponsored Lib-Lab MPs, remained allied to the Liberal Party until 1911, indicating a deep affinity with liberalism in some industries and regions.
It was also pointed out that it while it had indeed been a Liberal trade union official, Walter Osborne of the Railwayworkers, who challenged the union political levy and affiliation of unions to the Labour Party, the campaign to reverse the Osborne Judgement of 1909 depended on a sympathetic response from a Liberal government. Even though the terms of its repeal and replacement by the Trade Union Act of 1913, were not all that the unions wanted, it was generally seen as a pro-union measure with ballots and individual 'opt-outs'.
This theme was also taken up from a different angle in another contribution. For pride in their skills and abilities to improve themselves and their families made many workers feel good about themselves, and the early trade union banners, with their 'defence not defiance' slogans, also showed aspirations to make a contribution to society rather than blow it up. So why didn't closer affiliation between Liberal Party and unions survive? It was suggested that this was because the Independent Labour Party's ideas about redistributing income appealed more to unions from the 1890s onwards. Moreover, the economic divide was important, and the Liberals' failure to put up working class candidates limited their appeal on a class basis.
Response
Alastair emphasised that it was important to remember that in the UK socialism did not emerge from the unions, but was a middle-class idea brought from outside the movement. The mainstream of trade union political thought, based on the distinction between the productive classes and those on unearned incomes, was to cooperate with employers and to go after the bankers and landlords. Yes, there was lots of industrial conflict with employers, but this did not flow through in most unions' attitudes as a conflict with capitalist society as a whole. Close affiliation between unions and the Liberals had worked for 50 years, just about the same length of time as the heyday of the unions' relationship with Labour. This earlier epoch in labour history, in which the main trade union rights had been established, has been obscured and needs revisiting.
What about redistribution? Liberal trade unionists much preferred to achieve this through local collective bargaining, not through the central state, which could equally well choose to worsen conditions. A similar, mainly craft union perspective, remained an important strand in the development of the new Labour Party, which remained in many philosophic respects a liberal party. From 1900-1918, it functioned under the Liberal umbrella and until 1931 still pursued many Liberal-type policies. The story of how we got to what Tony Blair labelled 'Old Labour' was not one of class and socialism emerging from trade unionism, but rather was the result of wider events such as WW1, the interwar depression and WW2. And even after those events led to a rise in socialist rhetoric, a fundamental paradox remained in the minds of trade unionists: between the appeal of state intervention and a continuing commitment to free collective bargaining.
Baroness Susan Kramer
She found the previous historical discussion 'absolutely fascinating' and very helpful for her. As regards the trade unions and the Liberal Democrats today, there isn't a relationship. There is an Association of Lib Dem trade unionists, but it is not a very active body or as influential on party policy as other associated groups. Charles Kennedy MP addressed the TUC in 2001-2, but that seemed more to make the Labour Party feel uncomfortable. Danny Alexander, also addressed the GMB's conference. However, these contacts were superficial and there have been no serious engagements since Tony Blair and Paddy Ashdown's 1997 discussions about a 'Third Way Agenda', after Blair had ditched Labour's Clause IV. That Blair 'crush' ended after Labour's landslide election victory, though he seemed disappointed that he couldn't bring in 'Paddy' to his government. In 2010, Lords Adonis and Mandelson saw the election as an opportunity for coalition, but most Labour figures were very hostile. The maths was probably impossible anyway but many Lib Dems were troubled that the party was not in conversation with Labour. What was the union role in all that?
The Lib Dems rely for their funding more on middle class parts of society, those reasonably well off but not lots of spare cash, ones. She didn't see trade unionists aligning themselves with these groups, a nexus that includes such civil society groups as community activists, local charities, social enterprise etc.
On the question of 'economic liberalism' versus 'social liberalism', the Lib Dems are remarkably unwhipped, coming together on particular policies or pieces of legislation, in contrast to deriving policy from discussing political philosophy in the abstract.
The Lib Dem perception of unions is that they are so deeply in Labour camp, there would not be a lot of profit in having discussions. It seemed it would be a big use of time for little return. They view trade unions also as very autocratic bodies, a feature which grates against their own democratic instincts. They are not viewed as genuinely democratic, but as struggling to engage with their membership from the top down and not representing their members' views well.
All the same, there should be common ground between the Lib Dems and trade unions on a lot of policies. In the first place there is Vince Cable's attempt to limit Tory instincts to reduce workers' rights, and his pressure instead for new paternity provisions, expansion of flexible working, and the extension of free childcare, but the unions seem uninterested. Similarly the Lib Dems are keen on mutuals, cooperative structures and employee share ownership but this runs dead against the union agenda. as we saw recently with the restructuring of Royal Mail. The Coalition were proposing at least 10% of the shares be given to Post Office workers in a mutual structure. Some union members were quite interested, and 'old line postal worker union folk' in the Lords seemed keen, but the CWU and the other unions were very hostile, holding meetings in the Commons to oppose the legislation. The Labour Front Bench was very uncomfortable.
Other policies where the potential for common ground between the Lib Dems and the unions has not been realised would include: enabling the 'third sector' to raise money more easily; reviving manufacturing as part of a regionally-balanced economy, not just south east and service industry focused; reform of the House of Lords; investment in infrastructure and housing; reform of the banking system; apprenticeships and youth employment; and cutting income tax for low earners.
The Lib Dems are a small and overstretched party: very few of their leading politicians are not in government office, and most of their MPs are under constant pressure from highly-educated and vocal constituencies. So, while individual ministers will talk to trade union representatives when it is a part of their specific brief, she was not quite sure how they could take forward any more general dialogue with the unions.
Discussion
There was general appreciation for the frank and open way in which Susan Kramer (SK) had spoken, though it was also felt that her perceptions of the unions didn't always penetrate very deeply. She was reminded that many unions are not affiliated to the Labour Party and that some were heavily involved in local community activities e.g. the steel union ('Community') which runs training programmes, and banking union Accord. Similarly, some of the smaller affiliates were unhappy with the state of the TUC in which two or three of the huge affiliates over-dominate. She might find that some of these would be happy to develop a better relationship with the Lib Dems around the agenda she had outlined.
SK explained that part of their problem in taking up such opportunities was that the Lib Dem HQ is small and overstretched, particularly since the loss of the 'Short' frontbench and 'Houghton' funding had hit their research and other resources hard. In a ministerial capacity, some Lib Dems do engage with unions, e.g with the teaching unions on education measures.
A more critical view of the Lib Dems was that they had no understanding or knowledge of the trade union movement - its rules and cultures. There is a lack of any engagement at any level, even with TUC. There is a tendency to adopt media caricatures of the main trade unions e.g. her remarks about the CWU. Perhaps more Lib Dems should attend more union conferences to hear their debates and see their delegates making policy. This would give a better understanding of their point of view.
Trade unions are vitally interested in employment and they see their memberships haemorrhaging due to unemployment. They find it hard to understand why Liberals stay in coalition with the Tories, which is contributing so much to that situation. As long as this continues it is difficult to see what basis there could be for an alliance between Labour and the Lib Dems and the influence on some government policy areas mentioned seem minor by comparison. The Lib Dems look likely to come fourth in elections after UKIP.
SK saw that hostile contribution as epitomising the Lib Dems relationship with the unions. As they see it, the union people who come to meetings tend not to be senior or representative figures, just public affairs people and so there is little dialogue. Invitations are not forthcoming from the TUC and its leadership seems uninterested in having any dialogue with them. Yes, they ought to be engaging with smaller unions but their scarce resources prevent them doing more. As regards the next election, she believed that a more far-sighted Ed Milliband won't wish to see too many Lib Dem seats being lost as that might simply enable the Tories to achieve a majority.
Another felt that the reason for the poor dialogue was due to the party system, which exaggerates differences and erects personal and ideological barriers to sensible cooperation on issues of mutual interest. All political parties are to blame for this. Union activists who are heavily influenced by the Labour Party on political and wider social issues are unlikely to give serious consideration to other parties' rationale for apparently hostile policies. However, the onus is on Lib Dem leaders to try harder and reach out to trade unionists given their historic affinities and the fact that there are over 6 million trade unionists, still the largest voluntary associations in our society. The difficult representative role which active trade union officials play at work should be better recognised as a major contribution to civil society. This comes back to Alastair's point that any future alliance should be around an enthusiasm for these finer features of trade unionism.
SK Did not want to overdo the hostility, but felt it required 'two to tango'. How many trade unionists went to Clegg's launch of the Nuttall Report on Employee Ownership?
To which the response was that employees don't believe they need to gain a stake by buying shares - in fact working for an employer is seen as their primary stake in the business. The Lib Dems need to realise that there are different and valid ideas about such matters.
SK Yes, the Lib Dems view of industrial democracy diverges from the trade union view, but if unions were the representation channel through shares, there might be unhelpful tensions transmitted to the boards of companies. The union role therefore deals with a different set of issues.
The issue of worker bonuses was also raised but there was not time to go into this whole important area in greater detail.
In his overall response, Alastair said that he felt that the wider events to which he had already referred viz., WW1 &2 and the interwar depression, had changed the British party system so much and led to the decline of liberalism, the Liberal Party, the churches and non-conformity. The erosion of those forces also explains why there isn't more dialogue. Susan responded, reiterating how much she had enjoyed the exchanges and learnt quite a bit from them. She would be taking a positive message to her party, that this relationship should not be neglected, though resources are an issue. She hadn't wanted to suggest that there isn't dialogue in specific issues e.g. health and education, restructuring government etc., but this is more on a policy by policy basis than as a general open relationship.
The Chair thanked Baroness Susan Kramer for her frankness and both speakers for their most stimulating input to this part ofHistory & Policy's examination of the role of trade unions and the political parties.
James Moher and Alastair Reid
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