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The Pursuit of Economic Dynamism

  • David Coates

Abstract

From the outset, the New Labour government put economic growth at the centre of its concerns, and rightly so. For leading ministers knew well enough that the sustained growth of the economy as a whole, and the enhanced international competitiveness of its leading companies, were vital prerequisites to the successful implementation of the full sweep of the party’s manifesto commitments. Certainly they were well aware as they entered office that, without sustained economic growth, they would be unable to put clear water between themselves and the Conservatives. They would be unable to ‘switch spending from economic failure to investment’,1 as they liked to put it. They knew too that they would not be able to increase the volume of social expenditure, while freezing personal tax rates as they had promised, unless they could somehow trigger a rising tide of economic output. They were presumably also aware that, down the line, they would not even be able to guarantee New Labour’s own re-election unless they had by then produced an economic ‘feel-good factor’ in the party’s voting base, of the kind that had so cruelly eluded John Major. Since that re-election was indeed a dominant policy concern of the New Labour leadership from the outset, it was no surprise that once in office, the Chancellor, Gordon Brown, regularly described ‘the Government’s central objectives’ as the achievement of ‘high and stable levels of growth and employment, and sustainable public services, built from a platform of long-term stability’.2

Keywords

Public Spending Child Poverty European Monetary Union Labour Government Lone Parent 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Notes

  1. 1.
    Labour Party, New Labour: Because Britain Deserves Better, London, Labour Party, 1997, p. 11.Google Scholar
  2. 13.
    Tony Blair, The Third Way: New Politics for the New Century, London, Fabian Society, 1998, p. 8.Google Scholar
  3. 14.
    Labour Party, New Labour: New Life for Britain, London, Labour Party, 1996, p. 12.Google Scholar
  4. 16.
    Gordon Brown, ‘The conditions for full employment’, The Mais Lecture, City University, London, 19 October 1999.Google Scholar
  5. 17.
    Not least James Naughtie’s The Rivals, London, Fourth Estate, 2002, and Andrew Rawnsley, Servants of the People: The Inside Story of New Labour, London, Hamish Hamilton, 2000.Google Scholar
  6. 23.
    Because of space constraints, this is not part of our story here, but it is an important part of the overall New Labour one. The impressive work of Clare Short, and now Hilary Benn, and the sustained effort of Gordon Brown to both ease the burden of debt on the poorest of Third World countries and to bring the UK aid budget up to 0.7% of GDP, are among the finer parts of the New Labour record. It is notable in this regard that in the 2004 Comprehensive Spending Review the Department of Overseas Development saw its budget increased by more than 9% a year between 2005 and 2008 when other departmental budgets were being constrained. Periodically, the Prime Minister also joined in: with a messianic statement on world justice to the 2001 party conference, and with the 2004 Commission for Africa. The Blair touch here smacked of liberal imperialism. The Brown initiatives seemed more like global Keynesianism. The role of the UK at the World Trade Organization (WTO) and International Labour Organization (ILO) has yet to be charted fully, and needs to be. On the downside of the Prime Minister’s propensity for liberal imperialism and unanchored moralizing in foreign affairs, see D. Coates and J. Krieger’s Blair’s War, Cambridge, Polity Press, 2004. For a sympathetic but ultimately critical account of the early stages of Brown and Short’s foreign aid policy,Google Scholar
  7. see R. Dixon and P. Williams, ‘Tough on debt, tough on the causes of debt? New Labour’s Third Way foreign policy’, British Journal of Politics and International Relations, vol. 3(2), 2001, pp. 150–72.CrossRefGoogle Scholar
  8. 28.
    Gordon Brown, ‘Modernizing the British economy: the New Mission Treasury’: speech to the Institute for Fiscal Studies, 27 May 1999.Google Scholar
  9. 38.
    For a very comprehensive exposition of the thinking behind these initial policy moves, by two of their key architects, see Ed Balls and Gus O’Donnell, Reforming Britain’s Economic and Financial Policy: Towards Greater Economic Stability, Basingstoke, Palgrave, 2002. For two views of the adequacy of it all,Google Scholar
  10. see M. Artis and M. Sawyer, ‘The economic analysis of the Third Way’, New Political Economy, vol. 6(2), 2001, pp. 255–78, andCrossRefGoogle Scholar
  11. S. Buckler and D. Dolowitz, ‘Can fair be efficient? New Labour, social liberalism and British economic policy’, New Political Economy, vol. 9(1), 2004, pp. 23–38.CrossRefGoogle Scholar
  12. 41.
    On this, see N. Carter, ‘Whither (or wither) the euro? Labour and the single currency’, Politics vol. 23(1), 2003, pp. 1–9.CrossRefGoogle Scholar
  13. 42.
    W. Keegan, The Prudence of Mr. Gordon Brown, London, John Wiley, 2003, p. 286.Google Scholar
  14. 43.
    Figures from R. Brooks, Pay and the Public Sector Workforce, London, IPPR, 2004, p. 2.Google Scholar
  15. 64.
    David Blunkett, ‘Cutting-edge jobs programe works twice as fast’, DfES Press Release, 28 February 2001.Google Scholar

Copyright information

© David Coates 2005

Authors and Affiliations

  • David Coates
    • 1
  1. 1.Wake Forest UniversityUSA

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