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Home Opinion A real version of mutualism for the left

A real version of mutualism for the left

Michael Stephenson - 12 October 2010


Forged in the values of the left, and with a long and considerable track record of success, mutualism is an idea whose time has come back

In recent years mutualism has become one of the most badly-used expressions in political debate.

On the right, it has been both exploited for short term political gain by the Conservatives and manipulated to fit in with an under-defined and amorphous idea of social enterprise that encompasses everything from benevolent corporate citizenry to the unrealistic elevation of the voluntary sector to the apparent role of key delivery agent for the bulk of the welfare state.

On the left it has been thrust into the limelight as the “next stage” for Labour yet has never been truly recognised for its central place in the philosophy and history of the labour movement nor given sufficient prominence in Labour’s narrative.

What we need now, therefore, is a clear working definition of mutualism that acknowledges its legitimate place on the left of politics, recognises the political circumstances of the right’s hijack of the term and provides practical ideas for Labour as it rebuilds both its organisation and its policy offer to the nation.

I say this with a profound sense of duty as the general secretary of the Co-operative Party, the organisation which more than any other, has held the ideological torch for mutualism for more than 90 years.

We have consistently advanced the idea of mutualism through every one of our manifestos and we have dutifully played the role of Labour’s sister party through thick and thin.

It was therefore particularly galling to witness David Cameron use the spurious “Big Society” as an election campaign theme when Labour’s Manifesto included 24 specific co-operative and mutual policy ideas drawn from the Co-operative Party.

Labour should have been bolder in using mutualism as a unifying theme of its manifesto and an antidote to the shallow opportunism of the Tories yet Cameron was able to somehow convince the population that their commitment to mutualism was both genuine and long held.

To compound that problem, now that the election is lost, some on the left have fallen for the trap of denouncing the Tory/LibDem "big society" as simply a stalking horse for cuts to public services.

The Co-operative Party sees this differently.  The "big society" is actually a much more insidious version of Thatcherism in that it places undue pressure on volunteers or staff to run public services and offers no hope of state assistance if those services fail to make a profit or remain viable.

Without a clear mutual governance structure that retains them as community assets in which all members of that community (service users and staff) have a say in how they are run, those services become vulnerable to either collapse or the intervention of a private sector provider.

It is Thatcherism disguised as mutualism.
The challenge for the left is to see this betrayal of mutualism in terms of its biggest progressive policy offer.

And here is Labour’s biggest disadvantage in claiming mutualism as its own. Despite an historic array of co-operative and mutual policies in the Blair/Brown years which saw an unprecedented handback of power to the people, comparatively few voters associated Labour in government with mutualism.

Foundation Trust Hospitals, co-operative trust schools, football supporter trusts and the biggest ever overhaul of the regulations governing the co-operative sector are all concrete examples of how mutualism became reality under Labour yet despite this decade-long record of achievement, the case was not made with sufficient clarity or force to ensure that no Tory tanks could be parked on the lawn of mutuality.

This is in part due to the mis-understanding of mutualism which had its roots in the early history of socialism in this country.

In the 19th century the development of the left was characterised not only by the statist theories of Marxist ideology and the growth of trade unionism but by the particularly and uniquely British idea of co-operatives, friendly societies and other bodies that were progressive in orientation but placed co-operative organisations rather than the state at the heart of left wing ideology.

This home grown version of socialism promoted the idea that people could come together to meet their common economic, social and cultural needs and aspirations through jointly-owned and democratically-controlled enterprises. 

Yet over time Labour turned its back on this practical and successful view of socialism and increasingly embraced a statist approach that by the end of the 20th century had become obsolete and contributed to its poor electoral performance.

By taking this mis-step, the British left missed an early opportunity to reconcile socialism with individual aspiration and the effective marriage of a genuine mixed economy with social justice.

The Labour Party would learn that lesson by 1997 yet even the New Labour experiment was in some ways a missed opportunity.

Although it ushered in an impressive range of co-operative and mutual policies as outlined above, Labour could have been much bolder in extending the mutual principle in areas such as housing, health, energy and social care.

Mutualism, the idea that neither the state nor the market should be the natural default position of our public services, was so obviously consistent with the aims and values of New Labour, and as has been frequently observed, should have been the next logical step in the evolution of New Labour and its programme of investment and reform.

Further, there were institutions in the public sector such as the BBC and Network Rail that were ripe for mutualisation but were instead subjected to reforms that neither put them in the hands of the people that use them nor delivered the quality of service that those users could rightfully expect.

And some other well-merited plans for mutualisation, for example British Waterways, came too late in Labour’s term in office to guarantee that they would be successfully completed before the Tories came in to unravel them.

So what can Labour do now to get this mutual vehicle back on the road?

First, it needs to embrace some specific policy ideas that exemplify the fact that mutualism is a progressive set of ideas and something alien to the central beliefs of Conservative ideology.  An ideal example of that would be the expansion of mutual housing.

A whole generation of people have been excluded from the dream of home ownership by the fluctuations of the mortgage market.

It is clear that conventional methods of increasing affordable housing supply through either mortgages from high street banks or council housing will never fully meet demand.  A radical mutual housing solution based on the use of Community Land Trusts would make sure many people could take a real step on the property ladder and by using a mutual solution those most in need would benefit the most.

Second, it needs to advance policies that show its traditional supporters that it is on their side on the issues that matter.  The best example of this would be the re-mutualisation of Northern Rock, one of the failed banks that was de-mutualised thanks to Tory legislation.

Mutuals are owned and controlled by their customers. They have been more responsible and better for savers and society than shareholder-owned banks. By re-mutualising Northern Rock Labour would signal to its supporters that it wants the economy to be about people not just profit.

The Tories and Lib Dems have already signalled that they would sell Northern Rock to an existing bank rather than return it to the mutual sector.  This is a once in a lifetime opportunity to undo the damage the Tories did to our building societies and inject some much need mutuality in the financial services sector.

Third, it needs to promote policies that give a mutual slant to the landmark initiatives that it brought in between 1997 and 2010.  Voters need to be reminded that New Labour did actually introduce reforms that changed our country for the better despite the bleatings of the Tory press.

The best example of this would be an unmistakably New Labour reform such as SureStart.

The expansion of mutual Sure Start centres would send a strong signal about Labour’s continuing legacy and provide tangible evidence of its capacity to renew its agenda while remaining true to its progressive and reforming instincts.

Fourth, it needs to be robust in telling other parts of the Labour movement that mutualism is a legitimate and valued part of the Labour tradition.  Trade unions, socialist societies and the membership of the party need to understand that mutualism and the institutions that promote it like the Co-operative Party, are not some estranged member of the family.  They have been at the heart of the movement for more than 150 years and have contributed ideas, resources and elected representatives to the Labour cause for decades.

Fifth, and most importantly, it needs to never lose sight of the fact that mutualism is a reconciliation of the traditional values of the labour movement and the imperative for modernisation that characterised the most electorally successful period in Labour’s history. 

If socialism is the successful marriage of ideas and organisation then there is no better example of that marriage than mutualism.

Forged in the values of the left, based on practical action which empowers the dispossessed and with a long and considerable track record of success, mutualism is an idea whose time has come back. 

Labour need to recognise that and make it a permanent feature of what it stands for.

Michael Stephenson is general secretary of the Co-operative Party

This is a contribution to Policy Network's work on Globalisation and Governance.

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The Policy Network Observatory promotes critical debate and reflection on progressive politics. It is centre-left orientated but determinedly challenges social democracy. It is pro-European but restlessly questions EU institutions and practices.

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