IN 1929 when the British Labor Party was asked for the second time to form a government it had no majority in the House of Commons. It was the largest single party but it could govern only so long as it retained the support of a considerable number of Liberals. At an early stage in its governmental career Mr. Lloyd George stated, upon behalf of the Liberal Party, that they would not support any measure of socialism. It then became clear that the utmost that Labor could do was to proceed upon reformist lines, similar to, but perhaps rather more bold than, those which the Liberal Party could itself have adopted.

Unfortunately promises of a definitely socialist character had been held out to the supporters of the Party. These had been enshrined in a document which was afterwards often referred to, "Labor and the Nation." It was not so much a program as a collection of proposals of all kinds, varying greatly in importance and in character. Some of them were definitely socialist, others decidedly reformist, and no order of precedence either as to time or importance had been laid down. The supporters of the Party in the House of Commons included persons of all shades of opinion, from the liberal-minded on the one hand to revolutionary socialists of the Independent Labor Party on the other. As time went on it became abundantly clear that the tactic of the Government was not to ride for a fall by introducing definitely socialist measures, but to remain in power as long as possible, carrying through such reformist measures as were possible with Liberal support. Those who desired to see something effective done to meet the deepening crisis of capitalism became more and more discontented, until the Independent Labor Party members formed themselves into a definite attacking group with a view to forcing the pace.

This had little practical effect at the time, as any issue upon which this group were prepared to vote against the Government brought the Liberals and others to the latter's aid. But it was not only in Parliament that discontent was brewing. In the constituencies, too, the keener supporters became more and more disappointed. Socialism had been talked of so much and so long that Party members believed in the reality of their leaders' intentions. The excuse that the Government was in a minority and that it had done more than any previous Government to alleviate the lot of the workers helped hold them in line. But the course of byeelections showed the Government's waning popularity.

It is a common feature with all capitalist governments elected upon a wide franchise that they become progressively less popular the longer they remain in power. The workers who have been given magnificent promises at election time soon begin to realize how hollow and false those promises were. The swing of the pendulum is the necessary corollary to extravagant and impossible electioneering promises. With a socialist party it should have been different. This was something new, and real hopes were entertained of a fundamental change. However, as time progressed, it was realized that nothing new or startling was coming out of Parliament. There seemed little to choose between a Labor Government and a Liberal or Tory Government; all made extravagant promises, none fulfilled them.

The real testing time came in 1931. The financial difficulties in Germany and Austria frightened the City of London, and when a run started on the pound sterling they decided that action must be taken. Some day, no doubt, the true story will be told of the transatlantic telephone conversations which preceded the fall of the Labor Government, but these were of small importance compared to the real issue that was fought out within the cabinet whether consciously or unconsciously. The moment had arrived when reformism had to be abandoned. It had necessarily increased the difficulties of the capitalists with their rapidly contracting markets, and it could no longer be tolerated without the danger of a complete collapse of the whole system. Two paths were open: to allow reaction to take charge and to give up the concessions which had been extracted from capitalism; or to proceed to risk the breakdown while making a rapid change-over to socialism. It was this latter possibility, no doubt, which alarmed the City of London.

Within the cabinet, as all the world knows, there was a division of opinion. Those who subsequently joined the National Government took the view that it was more important to preserve the economic system than to attempt to establish socialism; the rest felt themselves bound by their pledges to the workers, though they had no very definite ideas of how next to proceed. In the result neither the Labor Party nor Parliament was consulted, but a number of the party leaders entered into a coalition with the combined capitalist forces under the guise of a National Government with the obvious intention of saving capitalism.

Within the Trade Union movement and the Labor Party there is a great tradition of loyalty. The leaders who had grown up with the movement were almost idolized; their pictures occupied the place of honor in thousands of working-class homes. It seemed almost impossible to Labor supporters throughout the country that three of these leaders should have joined the enemy, and there was great bewilderment as to the meaning of all that was taking place. After a short sitting of Parliament, during which sundry reactionary emergency steps were taken, the election of the autumn of 1931 was held.

During the few weeks preceding the election the parliamentary Labor Party, which still remained as a strong opposition, feverishly busied itself with working out a new policy. It was obvious that the whole circumstances had changed, and the definitely socialist elements in the party insisted upon the necessity for a decisively socialist program. Shortly before the election the party held its annual conference at Scarborough and the statement that the whole policy of gradualism had been finally abandoned was greeted with immense cheering. Indeed, in the first flush of the realization of the altered circumstances a much more advanced policy was adopted, but it was hastily put together with little time for consideration. In the result, many candidates did not appreciate its implications; many different interpretations of it were put forward from the party platforms; and every opportunity was given to the National Government supporters to mislead the electors as to its meaning and content.

When Lord Snowden, still then Mr. Philip Snowden, announced over the wireless that the very policy which he himself had approved in "Labor and the Nation" was "bolshevism run mad" it was hardly to be wondered at that the electorate became frightened. The Prime Minister waved million-mark notes at his audiences and explained the fate that would overtake the poor if the wicked socialists, amongst whom he himself had been numbered but a few weeks earlier, were to be returned to power. In this confusion and panic the wonder is not that so few Labor members were returned, but that so large a vote was cast for an ill-digested but distinctly socialist program. Over six million electors stood by the Labor Party, but owing to the combination of all the capitalist elements in a united front of Tories, Liberals and so-called National Labor less than 50 Labor members were returned.

Disillusionment set in. The undignified squabbles that ensued in Parliament between members of the late Labor Cabinet who now found themselves keen antagonists did nothing to improve the situation. Apathy and despondency permeated the party and the question was constantly asked at meetings: How can we know that our present leaders will not desert us as our former leaders have done? This was a cry from the heart of the movement and no mere superficial argument. It became obvious that a much more fully considered statement of policy must be formulated as the basis for propaganda and as a platform for the next election.

During the ensuing year the Independent Labor Party, which had drifted further and further away from the main party, definitely severed its connection and constituted itself a rival organization. In the process it was itself split in half between those who were in favor of disaffiliating and those who believed it wiser to stay within the movement and assist in making it definitely socialist in its policy. There had also been started a new body within the Labor movement, the Society for Socialist Inquiry and Propaganda (S.S.I.P.) which had met with considerable success amongst left-wing elements of the party. Arrangements were now made to bring together those of its elements which had desired to remain affiliated and the members of S.S.I.P. At a conference held at Leicester immediately before the 1932 Labor Party Conference the Socialist League was formed out of these elements, with the late Frank Wise as chairman. In Scotland a corresponding body, the Scottish Socialist Party, was formed. Both the Socialist League and the new Scottish Party obtained affiliation to the Labor Party, though not without some heartburnings on the part of several members of the National Executive of the Labor Party.

Before the Leicester conference it had become apparent that the more right-wing elements in the party were beginning to get nervous of any too decisively socialist proposals. At Leicester, the executive -- which was considerably more on the right than the floor of the conference -- was defeated on the issue of the nationalization of the joint stock banks. This was an important matter in itself, but even more important as showing the trend of thought within the movement. Since that time many things have happened in Europe and America, and these have had their effect upon thought and plans within the party.

Economic nationalism has made headway in all directions and in the field of international policy there have been growing difficulties and tension. But apart from all this there have been the attempts by various nations to work out a political means of solving their internal economic difficulties. The continued economic crisis in capitalism has rendered these efforts more desperate or more extreme. The three most outstanding experiments which have engaged the attention of the Labor Party are those in Russia, Germany and the United States of America.

Russia has been proceeding steadily with her experiment in communism and, judged in the light of the difficulties of other countries, has met with a very considerable degree of success. She has at last succeeded in bringing in the peasant population as co-adventurers in the new state, perhaps the greatest accomplishment of the whole revolution. The standards of life are low in Russia when compared with western Europe or America, though not when compared with Tsarist Russia. This low standard, however, has been largely self-imposed, in order that as large a volume of productive energy as possible might be devoted to capital goods and -- alas! -- to munitions of war. With Japan as a neighbor, and with the rape of China before her eyes, Russia felt herself forced to arm, and to arm heavily.

Germany has witnessed a revolution of reaction. Social democracy, which had a chance of converting the economic system in 1918, did not take that opportunity. Instead, a reformist policy was followed and economic power was left in capitalist hands. The load of foreign debt resulting from the war and the perpetuation of capitalism, to some extent forced upon Germany by capitalist nations who looked to her for reparations and debt payments, led to the breakdown of her industrial and financial structure. There was no remedy that could save capitalism which could be applied with democratic consent, so democracy was swept aside and its place taken by a dictatorship financed and supported by big business. The social democratic and trade union movements of Germany had been looked upon as the most influential and stable in the world. When they were wiped out in the course of a few days it came as a far greater shock to the Labor Party than similar events in Italy had been. Ominous, too, was the growth of this extreme form of capitalism. It was no longer an isolated experiment in a comparatively distant country, but rather a growing world movement the first evidences of which were becoming apparent in our own country.

In the United States of America, President Roosevelt has staged the greatest experiment ever made in liberalism. With tremendous courage and determination he has set himself the task of saving capitalism, if such salvation is possible. This idea naturally appealed to the more right-wing elements of the Labor Party; in fact, the experiment was hailed from some labor platforms as full of hope. It was not until the succession of strikes showed that the American trade unionists were not wholly satisfied with the development of the situation that doubt crept into the minds of even the most right-wing supporters of the Labor Party. The socialist element in the party frankly stated from the outset that, however admirable and courageous the experiment might be, it was bound to fail unless the President was prepared to assume the economic power in the state and utilize it to terminate the chaotic injustices of capitalism by reorganizing the industrial life of the country upon a socialist basis. That view I held and still hold; it was reinforced by the conversations which I had when in the United States last spring.

At a later date came the tragedy of the Austrian social-democrats. It had for long been a commonplace in labor speeches to hear descriptions of the marvellous post-war developments in Vienna. The houses, schools, hospitals and social amenities for the workers in the Austrian capital were constantly held up as examples of what socialism might do for a great city. When the administrators and supporters of this régime were forced against their will to defend their work and their party by force of arms against the fascism of Dollfuss, and were mown down in their attempt to protect social-democracy, the effect amongst the workers in England was profound. One of the last citadels of social-democracy on the continent of Europe had fallen a victim to the rising tide of fascism.

At first the tendency in the Labor Party was to disregard fascism as a serious danger in England. That sort of violent action might suit foreigners but it would never appeal to the Englishman with his tradition for tolerance and constitutionalism. There was a tendency, which the socialists in the party attempted to combat, to look upon this new phenomenon as something purely political rather than as the outcome of the economic difficulties of capitalism. When it became evident that fascism not only could be started but had been started in England the necessity for dealing with this new menace was generally acknowledged. But how? The right wing, like the Liberals, believed in stressing insistence upon democracy as an end in itself. The left wing took the view that some more effective and realistic program of action must be put forward if fascism's superficially attractive appeal was to be defeated. While agreeing that the militarization of politics must be stopped, they placed far more emphasis upon a bold policy of out-and-out socialism as a means of keeping the younger people especially out of the reach of the fascists.

The English press has tried very hard to build up an antagonism between the Labor Party and the Socialist League, but with peculiarly little success. The Socialist League represents definitely some of the more left-wing elements within the Labor Party. It is not in any sense a rival party. It neither puts forward candidates nor nominates candidates for local or parliamentary elections; in fact it is prohibited from so doing by its constitution. It does, however, seek within the Labor Party to propagate ideas that are completely socialist and to influence the party in the direction of more advanced policies.

The policy of the Labor Party is laid down at its annual conferences upon the basis of reports and programs submitted by the National Executive. At the 1933 conference held at Hastings the party marked time. It was felt that the moment had not arrived when it was necessary to dissolve the compromise between gradualism and socialism. Since that time a number of fresh policy reports have been produced and an attempt has been made to recapitulate the whole program of the party in a document entitled "For Socialism and Peace" which is being submitted to the conference at Southport in the first week of October 1934.

The National Government has now been in office for three years. There must, in normal circumstances, be a general election not later than the autumn of 1936. It is possible that by necessity or for tactical reasons the Government may call an election sooner, and it is therefore generally agreed that after this year it will be too late for the Labor Party to make any major alterations in its election program. It is essential that the propaganda for the party should proceed from October next until the general election upon the basis of a final policy statement authorized by the party in conference. It will therefore be necessary at the Southport conference for a decision to be arrived at upon the major issue: gradualism or socialism? Exactly how this issue will come up is not material; but it must be presented to the conference and upon it the conference must decide.

When it is analyzed this issue appears more a question of tactic than of political or economic beliefs.

Undoubtedly the growth of non-manual workers, particularly in the managerial, technical and clerical grades of industry, together with the great extension of largely unorganized labor in the distributive trades, has added a new problem to those which must be considered by any social-democratic party. Every member of the Labor Party is in agreement with the insistence upon the use of the machinery of democracy to bring about the economic change to socialism. To use that machinery an electoral majority must be gained. Two questions thus arise for decision. First, should the attempt be made -- at all cost -- to obtain that majority as soon as possible? Second, how can such a majority be gained? Upon both these points there are wide differences of opinion between the right and left wings of the party.

The right wing take the view that even at the risk of delaying socialism it is necessary to get a majority at the earliest possible moment. They are therefore prepared to modify the program in the direction of gradualism to the extent necessary to enable them to obtain the maximum support from radicals and progressives. They stress the disarmament and humanitarian sides of the peace and war problem in preference to the economic aspect. The program gives the impression of a definite though comparatively short reformist period before any serious attempt is made to deal fundamentally by socialist measures with the economic situation. Their position is somewhat akin to that of so many Americans who think that there would be a better chance for socialism if it were disguised under another name and the central feature of the socialization of the means of production were omitted from the program!

The left wing, on the other hand, insist upon telling the people frankly that certain definite things must be done immediately if it is to be possible to bring about the economic change democratically. They are prepared to take the risk of waiting, if necessary, until a sufficient body of electors can be convinced of the necessity for a socialist program. They realize fully the importance of middle-class support but believe that if the case is presented to these voters properly they will be prepared to follow the bolder and more logical lead.[i]

The decision taken by the Labor Party Conference upon this issue will no doubt profoundly affect for good or ill the party's electoral chances. At the present moment it is probably fairly accurate to say that the party could count upon over 8 million votes in the country. At the 1931 election it obtained rather over 6 million, while in 1929 its vote reached the peak figure of 8,362,000. To obtain a clear working majority in Parliament it is reckoned that 15 million votes would be required. Can the Labor Party add 7 million votes before the next general election? To that question no one can give an answer. If the present general economic situation continues up to the next election it is fairly certain that the 8 million votes will be to some extent increased; beyond that it is useless to speculate. There is no doubt that the effect of the virtual extinction of the Liberal Party has been to make it more difficult for the Labor Party to get a parliamentary majority. The combined capitalist vote will defeat the Labor vote in a number of areas where in 1929 the Labor candidate was elected because of a split capitalist vote. On the other hand, in quite a number of rural and "backward" areas there has been a remarkable growth of socialist opinion in the last few years; but it is doubtful whether this can do more at the next election than create large Labor minorities.

If the present slight boom in trade flattens out, as it appears to be doing, and another decline then sets in before the next general election, the number of those who are prepared for a radical change of system might be increased. The National Government have had a perfectly free hand to try every capitalist device for saving our existing economic system. They have tried them all, and are now thrown back upon a reliance on an improvement in international trade. There is at present no sign of any such marked improvement in this direction as would assist them to a considerable expansion of exports.

There is developing in this country the same conflict between the agriculturist and the industrialist which is such a potent factor in the American situation. In England the form which it has assumed at the moment is a strong urge from the agricultural interests to modify the terms of the Ottawa Agreements, and the trade agreement with the Argentine, which they allege are permitting dumping of agricultural produce from the Dominions and the Argentine upon the home market, to the detriment of the English farmer. This is, of course, a common factor in capitalist countries where the private interests of the profit-earners of industry, agriculture and finance constantly find themselves in opposition. There is no solution for such a difficulty within capitalism, except by a compromise of some sort or another.

At the moment the National Government is dealing with the situation by subsidies. The British farmer has already been completely freed from local taxation and has had large subsidies given to him upon his wheat, sugar beet, dairy products and meat. To offset this policy it has been necessary to offer a subsidy to British shipping due to the falling off of cargoes. For a time, no doubt, this wholesale granting of relief to producers of various kinds, who do not get the indirect assistance of tariffs, will be popular. Subsidies will no doubt buy many votes; but in the long run they can provide no cure for the evil from which we suffer. It may, however, have a considerable effect at the next election in one of two ways. The industrial workers as consumers may increasingly resent the increase in the cost of living brought about by this policy; and the agricultural workers will no doubt find that they get little or no share of the subsidies. This should lead to a growing unpopularity of the Government. On the other hand, there will be created for a time a spurious air of prosperity in the rural constituencies, little understood by the workers, and loudly claimed by the Government as the beginning of the solution of their difficulties. It is not possible to foretell which of these two influences will be the stronger.

There is one final factor of great importance and that is the question of peace or war. Capitalism inevitably drifts towards war: economic nationalism is the precursor of economic rivalries which are the root cause of war. In times of difficulty the war spirit of capitalism grows with its fears, and it finds too a great solace in the argument that the manufacture of munitions creates employment. It is forgotten that the manufacture of many really useful commodities would equally create employment! In Great Britain the National Government has changed its policy on disarmament and has now definitely adopted a policy of rearmament, which will probably accelerate as time passes.

It was claimed in the first instance that the tariff policy and economic nationalism were measures of a transitory nature, but now they have become an integral and all pervading part of the Government's policy. Similarly the rearmament program which is now stated to be small and tentative will no doubt grow and become a more and more important factor in the Government's international policy. The same people who pressed for and obtained the former are now pressing for and will obtain the latter. This will create a good deal of employment in certain areas where depression of trade has become almost chronic, and may produce the appearance of a considerable revival in trade.

Although the workers desire peace, yet the offer of employment and the false cry of national safety will be a great temptation to them to believe that the National Government's action is justified. No doubt the Government will conduct a terrorist program to frighten and intimidate the voters on this question. Speaking in the House of Commons on July 30, on the Labor Party's vote of censure on increased air armaments, Sir John Simon indicated this line of propaganda when he said: "I cannot help thinking that there are some crowded towns in the Midlands and in the North, constituencies which voted without distinction of party for the return to this House of Honorable Members sitting in different places to support the National Government, towns at present quite open and unprovided against the possibility of air attack, which will be much interested to see how their faithful representatives comport themselves on this occasion."

How far such arguments -- if they can be dignified by that term -- will affect the electoral situation it is not possible to say, but it does not appear unlikely that the National Government will attempt to fight the next election partly upon the basis of their usual scare statements as to socialism and partly upon a war panic. It is of course the intention of the Labor Party to educate and inform the electorate so that they may not be stampeded by such scares. Fortunately it is always far easier to raise a panic cry against the Government than against the opposition.

Reviewing the whole situation, of which I have been able to give only the barest outline here, it seems reasonable to expect that, unless something unforeseen occurs, there should be no very great difference in strength between the socialist and capitalist parties in the next Parliament.

[i] See such books as G. D. H. Cole's "The Intelligent Man's Guide through World Chaos," G. G. Mitcheson's "The First Worker's Government," and the author's "Why This Socialism?" (all published by Victor Gollancz, London).

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