The Great British Breakup: the Blair years

Theresa May once famously said “Brexit means Brexit.”

Unfortunately, as we’ve moved away from those comparably halcyon days of July 2016, it’s become more and more evident that no one – least of all Theresa May – has any idea what that actually means.

Now, with just under a week until we’re set to leave, a withdrawal agreement that appears to be dead in the water after two historic votes in the Commons, and seemingly no option of bringing it back for a third vote, it’s looking increasingly likely that we might just accidentally crash out of the EU.

So how did we get here? In this series – which began with the Thatcher years – I try and figure that out. This week, we pick up where we left off in 1997: the year Labour finally grab power after 16 years in opposition, led by a certain Tony Blair. There’s a chance to make good on the mistakes of the past, which starts well, but then pretty much everyone fucks up. The country proves that it’s still absolutely great at racism, some weird people get really into fish, and then the world’s economy gets trollied and pisses all over itself.

Cool Britannia

1997 was the year that would change everything –  at least, that’s how it seemed at the time. In the early hours of May 2, at London’s Royal Festival Hall, Tony Blair – the first Labour Prime Minister to win an election in 18 years – asked: “A new dawn has broken, has it not?”.

To a certain extent, yes, it had. The trouble was, once that sun had risen, it appeared to bear a striking similarity to the one before it.

Tony Blair’s legacy is, putting it diplomatically, mixed at best. On the one hand, the introduction of a National Minimum Wage, a Human Rights Act, and national programmes to eradicate poverty – including working tax credits and the Educational Maintenance Allowance, which provided government assistance to those on low incomes in work or education – mean the Blair Government was one of the most transformative in living history. It manifestly changed the lives of millions of the poorest people in the country for the better. So far, so good.

Unfortunately, Blair also started an illegal war which saw the death, injury or displacement of millions and the destabilisation of an entire region, whilst also buying into, and expanding on, Thatcher’s damaging economic policies.

“One of the key cornerstones of New Labour was the decision not to change the fundamentals of Thatcherite economics,” says Ellie Mae O’Hagan, journalist and author of forthcoming book Collapse. “In his book, The Blair Revolution, which lays out the ideals of Blairism, Peter Mandelson argues that the strategy ‘is to move forward from where Thatcher left off, rather than dismantle every last thing she did.’ Thatcher had changed the soul of the country, and these politicians argued that it was impossible to win elections without accepting that.”

Years of electoral defeat at the hands of the Tories led to a radical shift within the Labour party under Blair. The removal of Party’s Clause IV (a clause committing Labour to the nationalisation of industry) and the adoption of “a third way” (a political school of thought which generally considers itself to be socially liberal and economically conservative) saw the ground laid for the greatest sell-off of public assets in history – starting with the NHS.

“On its own terms, the New Labour project was phenomenally successful,” adds O’Hagan. “One of its most outstanding successes was the way it became a kind of event horizon of ideology. In the years between 1997 and 2008, it dominated politics to the extent that there didn’t seem to be anything else outside of it. The fact that voters continued to elect Labour MPs even after the Iraq war is perhaps evidence of this.”

However, this entrenchment of Thatcherism within the fabric of our society would later come back into play in a big way (spoiler: Crash, Austerity, Crisis, Brexit).   

Immigration and the rise of hostility 

After Blair took office, throughout the late ’90s and early ’00’s, immigration found itself on the political map as a central issue. In 1997, net migration to the UK was around 48,000. In 1998, it jumped to 140,000, and hasn’t fallen below 100,000 since. It was something that Blair would continue to grapple with, leading to the mass expansion of detention centres and the introduction of deportation charter flights in 2001.

Either way, it became a defining issue in British politics. The Conservatives, continuing to struggle against the New Labour machine, made it central to their 2005 election campaign, erecting billboards across the country which stated: “It’s not racist to talk about immigration”. Blair, going toe-to-toe, gave a speech promising stricter border controls, and the implementation of an “Australian points-based system” (something which mercifully never quite came to fruition). It has, however, remained a hot topic issue ever since.

In recent years, immigration has become increasingly weaponised, to varying degrees of success – particularly in relation to the Hostile Environment and the Leave campaign in 2016.

The signing of the Lisbon Treaty

While all this was going on, Brussels was busy pissing everyone off. In 2004, a consolidating constitution was proposed, which would have replaced existing EU treaties with a single text, creating a much closer political union between member states. The constitution – and what many saw as the gradual creep towards a federalised Europe – was deeply unpopular in numerous camps.

Prime Minister of the day Tony Blair flipped and flopped around on the issue but finally promised a referendum on the text, owing to its controversial nature. But after voters in France and the Netherlands rejected it, the constitution was never ratified and our referendum was cancelled.

A few years later, most of the substantive parts of the constitution appeared in the new Lisbon Treaty, including the creation of a European ‘President’ and a ‘Foreign Minister’. There were widespread concerns that these new roles could usurp and undermine the ability of sovereign states to conduct their own foreign affairs.

There are some who believe that Blair’s promise of a referendum still stood. He disagreed, stating in an interview with the Financial Times in April 2007: “if it’s not a constitutional treaty, so that it alters the basic relationship between Europe and the member states, then there isn’t the same case for a referendum.”

Shortly after, he left office and was replaced by Gordon Brown. Brown tactically dodged the question by hopping on a plane on his tod and signing the treaty on behalf of the UK, pissing off pretty much everyone.

Much ado about Nemo

But, before we go any further, we need to talk about fish.

A lot of people – Nigel Farage, Michael Gove, Boris Johnson, Jacob Rees Mogg – seem to have quite the obsession with fish; or, more specifically, the common fisheries policy (CFP). The CFP refers to an EU wide fishing policy which implements quotas on different member states fishing industries, and has proven to be quite controversial.

The issue comes when you consider the notion of borders, the resources within them, and the inherent nonchalance of fish. While it is true that there are plenty of fish in the sea, they are, unfortunately, finite in number. Moreover, the fish show an almost wanton disregard for the arbitrary lines we draw around each country denoting sovereign states. In order to combat this – to ensure fair distribution of those resources – the EU implemented a common fisheries policy, ensuring that everyone gets fair crack at the fish. Essentially, the CPF is in place to stop a situation where one country can sweep up all of the fish stock, because the shoal has decided to swim on one side of an imaginary line on that particular day. It is controversial because it’s seen as emblematic of a bloated European Union, overreaching and dictating our domestic affairs.

Despite the relatively small nature of the industry – Griffin Carpenter of New Economics Foundation estimates the numbers of fishers to be around 12,000 compared to something like manufacturing which employs around 2.6 million people – few issues better symbolise the politics of Britain’s exit from the EU than fisheries. As Carpenter puts in his paper Not in the Same Boat: “Fisheries policy, it has been claimed, is a visible and visceral area where the UK can ‘take back control.’’

And finally, the crash

Anyway: Gordon Brown. Chancellor of the Exchequer for 10 years, he once famously proclaimed that he’d put an end to the “old boom and bust” system of capitalism, in which peaks and troughs in the economy were an accepted norm.  

Shortly after he took office in 2007, the Subprime Mortgage Crisis fired the starting pistol for a collapse of the worldwide banking and financial system, with several banks going into public ownership in order to avoid complete fiscal Armageddon. Grace Blakeley of New Statesman explains that the crisis was born of ‘securitisation’.

“Banks in the US had lent consumers huge amounts of money for mortgages from the 1980s onwards – private debt skyrocketed, and house prices increased. Some of these loans were made to creditworthy borrowers, some to subprime borrowers who would be unable to afford the repayments if their circumstances changed.”

“Banks then took the loans they had made to consumers and turned them into financial securities that could be traded on financial markets. This involved taking loads of loans of varying quality and blending them together into a package that could be sold on. This allowed the banks to disguise risk – by putting good mortgages in packages with bad – and increase the amount they were able to lend; because rather than waiting for people to repay their mortgages, they could sell the mortgages and use the proceeds to make more money now. The securities were either sold to investors or loaned to other banks in exchange for cash that could be used to make more mortgages.”

As house prices stopped rising, and people started to default on their mortgage, investors began to shit themselves. No one was buying the securities, banks couldn’t access cash and became insolvent, and the economy took a nosedive. After years of relative economic stability, boom and bust was back.

“The crisis was as seismic as a world war in terms of the effect it had on politics, but the response was to simply patch up the current system and continue as though it had simply been a blip,” O’Hagan explains. “By the time the financial crisis happened, most of our political institutions had become colonised by people who shared the same ideology as New Labour. As a result, they were not able to conceive of ways out of the crisis outside of the system that had caused it. In the intervening years, bits have started to fall off this system that has been loosely held together – and I think it is only in the last couple of years we have started to see it begin to fall apart.”

“It led to the Great Recession,” adds Blakely, on the collapse that followed the crisis: “There was a collapse in global growth, trade, and financial flows; masses of insolvencies; massive increases in public debt due to bank bailouts, falling taxes and rising spending, which led to public spending cuts in many places and a sovereign debt crisis in the eurozone.”

And with that, as the world’s economies collapsed. On top of proving the catalyst for the kind of inequality and division that would characterise British society for the coming years, it also opened the door to a certain David Cameron. Remember him?

Next up on The Great British Breakup:  

The economy is in the shit. Parliament is hung. The Lib Dems sell out. The Tories launch the single biggest assault on the working classes in living memory. It kicks off in the Middle East and then in the med. There’s a referendum in Scotland that the establishment wins, so then a referendum on the EU is promised and everyone totally loses the plot. Also, Labour carves itself a gravestone, and people are somehow shocked to find out that most of the country’s politicians are on the fiddle.

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