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21st Century Socialism is more Harold Wilson than Leon Trotsky.

T’S a new dawn of socialism, says Jeremy Corbyn. The S-word no longer needs to be whispered, according to the Shadow Chancellor John McDonnell. Indeed, it’s now being shouted from the rooftops, mostly by his enemies. The Daily Telegraph described Corbyn’s socialism as “a poisonous doctrine that has killed millions of innocents”.

Seeing Jeremy Corbyn as Joseph Stalin takes some doing. I don’t remember Uncle Joe making jam, cycling or digging an allotment. But the Telegraph says the elements of proletarian dictatorship are there for all to see in Chairman Corbyn’s programme of “nationalisation, centralised state control and a wealth-sapping race to the bottom in the name of equality”

Yet, the extraordinary thing about Jeremy Corbyn’s “21st-century socialism” is how intensely moderate it is. There is none of the class struggle rhetoric that you used to hear from groups like Militant or the Socialist Workers Party. There was no commitment in his speech to redistribution of wealth through the taxation system – no mention of specific wealth taxes or even the 50p tax band, both of which were advocated by Corbyn’s defeated leadership rival, Owen Smith. A £10 an hour minimum wage by 2020 is more than the £9 the Tories are offering, but not much.

The Labour leader’s speech to conference included no mention of Trident or reversing Brexit. A 1.5 per cent increase in corporation tax to fund educational maintenance awards and grants is a modest piece of Robin Hoodery, but Corbyn didn’t promise to abolish university tuition fees. Allowing councils to finance house building by borrowing on the commercial markets against the value of their housing stock is sensible but hardly revolutionary.

Corbyn talked up rail renationalisation, but so did Ed Miliband when he was Labour leader. There was no suggestion that he wanted to place the wider means of production under state ownership, which Gordon Brown advocated in his Red Paper in 1978. Even Corbyn’s talk of borrowing £500bn to invest through a network of regional investment banks has been trimmed back.

Yet, the speech was treated by much of the press and many Labour “moderates” as if it were the Communist Manifesto. In fact, with its emphasis on education, skills and new technology, it’s more like Harold Wilson’s Labour manifesto from 1964. John McDonnell’s “iPad socialism” is an updated version of the “white heat of technological revolution”. Nicola Sturgeon has been following the same ultra-cautious reformist path in Scotland, focused on education, education, education.

I’m not knocking this. You have to start somewhere and given the civil war raging in Labour, Jeremy Corbyn’s main aim was to try to unite the party. He is the first truly socialist, or rather social democratic, leader since Michael Foot, who was also no revolutionary. Corbyn is sincere about restoring full employment, reviving public ownership and closing the wealth gap. But he can afford to be much more radical than he has been in achieving these objectives.

Since Brexit and the Scottish referendum, there has been a sea change in politics, and it’s not just Momentum and the Yes Campaign who have mobilised against austerity. I met a prominent investment banker at a book festival recently who told me, as if it were self-evident, that corporations should be much more highly taxed because they are sitting on vast amounts of cash – some £500bn – that they won’t invest. This Tory voter also forecast that governments were going to have to intervene “massively” in the economy to keep the wheels turning. And now is the time to do it, he said, because the cost of borrowing is so cheap with near negative interest rates.

This heresy is not at all unusual. Commentators like Martin Wolf in the Financial Times have been saying something similar for years. Even Theresa May has been talking about issuing bonds to finance state investment. The axioms of austerity – paying down debt, cutting public spending, living within your means – have departed with the sacked Tory Chancellor, George Osborne. Only the most dogmatic neo-liberals reject the need for a new and more socially responsible economic policy that will address growing divisions in society.

Unfortunately there is a lingering negative group-think in the media and among the political classes which means social democratic policies still meet with an hysterical response. In the 2015 general election campaign, when Nicola Sturgeon advocated increasing borrowing by 0.5 per cent to generate funds for infrastructure investment, she was called the “Red Queen”. Labour politicians like Ed Balls said she was economically illiterate.

The reality is that the UK economy is undergoing structural change, which is producing insecurity of a kind we haven’t really seen since before the Second World War. It is starting to affect all classes bar the relatively rich. The idea of progress – that each generation should be better off than the previous one – is so ingrained in our political consciousness that it has been hard to accept that it has gone into reverse. The generation born in 1980, as the Institute for Fiscal Studies pointed out last week, has half the wealth of those born in the 1970s, who in turn have much less wealth than children of the 1960s. This is largely because these 1980s “millennials”, as they’re called by market researchers, can’t afford houses or pensions and are thrown onto the private sector where ever-rising rents are taking 25-30 per cent of their incomes.

Meanwhile, according to TUC figures, real earnings in the UK fell by over 10 per cent between 2007 and 2015. (They grew by 14 per cent in Germany and 11 per cent in France in the same period.) The Resolution Foundation, led by a former Tory minister, has called on the Conservative conference this week to address the “six million working families” who are struggling even on relatively high incomes. Times are tough and getting tougher.

This isn’t just a whinge by a cosseted “snowflake” generation whose sense of entitlement has got the better of them. It is a new economic reality. And with the combined forces of automation and globalisation squeezing the jobs market as never before – the Bank of England is forecasting that 15 million jobs, mainly white-collar, are at risk in the next 20 years – there isn’t an easy solution to this.

Education is not going to solve the problem of underemployment in an economy where artificial intelligence is taking over many management jobs as well as those of accountants, paralegals and even GPs. Taxation will have to be used to redistribute the wealth that has congealed with the top 1 per cent and 0.1 per cent to prevent the UK falling back into permanent recession. The state will become much more involved, not just in infrastructure and nationalising banks, but in devising things like a universal basic income. We can no longer assume that everyone can or should have a job.

These are huge challenges – a reversal of the neoliberal idea that the market should decide. The market has decided, and as the Bank of England chief economist, Andy Haldane, told the TUC last month, it is replacing people with robots. Politics in coming decades will be about making those robots work for the many and not the few.

About @iainmacwhirter

I'm a columnist for the Herald. Author of "Road to Referendum" and "Disunited Kingdom". Was a BBC TV and radio presenter for 25 years - "Westminster Live" and "Holyrood Live" mainly. Spent time as columnist for The Observer, Guardian, New Statesman. Former Rector of Edinburgh University. Live in Edinburgh and spend a lot of time in the French Pyrenees. Will that do?


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