Clause IV at 100

A century after it was introduced, it’s time to renew Labour’s commitment to a socialist economy.

Illustration by Phil Wrigglesworth

It was labour’s totemic article of faith, a paragraph which sustained the morale of party activists in politically barren times, infusing them with hope for a socialist future. A century ago, the Labour Party adopted Clause IV of its Constitution, which committed it to a historic mission: ‘To secure for the workers by hand or by brain the full fruits of their industry and the most equitable distribution thereof that may be possible upon the basis of the common ownership of the means of production, distribution and exchange, and the best obtainable system of popular administration and control of each industry or service.’

Labour had not been born as a socialist party, unlike the German Social Democrats, Spanish Socialist Workers Party or the French Section of the Workers’ International. But here was a statement of intent: Labour did not exist to administer capitalism, but to construct a new society.

The architects of the original Clause IV were far from revolutionary Marxists: Sydney Webb was a gradualist Fabian, while Arthur Henderson was Minister without Portfolio in the Conservative-dominated wartime government. But none could ignore the growing tumult around them. As Clause IV was being drafted, Bolshevism was on the brink of triumph in the Russian Empire and the revolutionary left seemed to be on the rise across Europe. In Britain itself, strike action had been escalating before the First World War, triggering growing panic in elite circles. Warships were sent down the Mersey, and Winston Churchill deployed soldiers to fire on striking Welsh miners.

Though unrest subsided when millions of British men were sent to fight on the continent, trade union membership more than trebled from 2.6 million in 1918 to nearly 8 million by 1919. Even as war continued to rage in 1918, strike action soared: 6 million working days were lost to industrial action. By the end of the year, even the Metropolitan Police had gone on strike.

Fabian Beginnings

Clause IV was not so much an attempt to capture this mounting disillusionment as to divert it. The British Government sent Henderson to Russia in the spring of 1917 — before the October Revolution — in the hope that he would persuade non-Bolshevik socialists to remain committed to the war. The trip clarified, in his own mind, the need to win the battle with the revolutionary left for working-class support. With Clause iv, Labour could now claim to be a non-revolutionary vehicle for socialism. But Clause IV was always a fudge, falling someway short of the radical demands of its day.

In a prominent example, instead of committing to workers’ democratic control of nationalised industries — as trade unions like the Miners’ Federation argued for — it aspired to the ‘best obtainable system of popular administration and control.’ When Labour formed a minority government in 1929 and Herbert Morrison — one of the leaders of the party’s right — became Minister of Transport, legislation for the integration and public ownership of London’s transport revealed the blueprint of what was to come. There would be no democratic control: instead, it would be run by appointed managers.

When Clement Attlee’s Labour won a landslide victory in 1945, Morrison was the architect of the new government’s nationalisation programme. The model chosen was the public corporation: no democratic participation by either workers or service users, and the old managers kept their jobs. Disillusionment with nationalisation soon set in. After the party’s third election defeat in 1959, Labour’s leader Hugh Gaitskell abortively attempted to abandon Clause IV, arguing that it was anachronistic and unrealistic. He was defeated, and Clause IV was inscribed on Labour membership cards thereafter.

But the Labour left recognised that the dream of Clause IV was not being realised. Tony Benn — the left’s figurehead from the 1970s onwards — declared that public corporations needed to be transformed ‘into expressions of our socialist purpose,’ adding that ‘policies and institutions must serve the people and not become their masters.’ In a direct challenge to Morrison’s model, he championed democratisation for nationalised industries. Under pressure from its left, in February 1974 Labour presented its most radical manifesto ever to the country, committing the party to ‘socialise existing nationalised industries’ and ‘take steps to make the management of existing nationalised industries more responsible to the workers in the industry and more responsive to their consumers’ needs.’

But this was to be the high watermark of the demand to democratise. In the first election of 1974 Labour gained seats but failed to win an overall majority. By the second election of that year, its radical commitment was purged from the manifesto. It proved to be a fateful decision. In 1975 Margaret Thatcher became the leader of the Conservative Party, bringing with her a deep ideological zeal for privatisation. The failure to give the public a sense of ownership and accountability over nationalised industry proved to be a major advantage in her offensive. ‘What earthly sense is it,’ she would ask, ‘that families should have a millionth share in some nationalised industry which is indifferent to their needs and wishes?’

Clause IV Moments

Labour emerged from its ‘wilderness years’ under Thatcher with Tony Blair as leader. Blair succeeded where Gaitskell had failed by scrapping Clause IV in 1994, enjoying far more favourable political circumstances. The collapse of the Soviet bloc had unleashed a wave of capitalist triumphalism. Across the world, Communist parties collapsed, socialist parties shifted to the right, and liberation movements such as the African National Congress resigned themselves to a neoliberal political economy. The crippling of the British labour movement, particularly following the defeat of the miners in 1985, reinforced Thatcher’s refrain that ‘there is no alternative’.

The market, it seemed, had won a final victory, and all that was left for politics was to manage its excesses. It was under these circumstances that Tony Blair’s New Labour set about constructing a new party in which decision-making was insulated as much as possible from popular pressure. Recognising that Clause IV served to raise the expectations of the grassroots and thus exert unhelpful pressure on the leadership, he set about undoing it. ‘The gap between our stated aims and policies in government fed the constant charge of betrayal,’ he declared in 1995, ‘the view that … the leadership was too timid to tread the real path to true socialism.’ The new Clause IV was a pale imitation of its predecessor, offering no specific commitment to socialist policies. Even its collectivist appeal — ‘by the strength of our common endeavour we achieve more than we achieve alone’ — is tempered further down by a commitment ‘to the enterprise of the market and the rigour of competition.’

Two decades on, and capitalism’s triumph appears far less permanent. The financial crisis of 2008 has been followed by a decade of economic stagnation and political turmoil. Where the market was once associated with efficiency and modernity, today it is just as easily associated with avarice and fragility. The self-evident failure of privatised utilities has led to overwhelming support for public ownership: according to a poll by one right-wing think tank, 83 percent support nationalising water, and around three-quarters back reversing the privatisation of electricity, gas, and the railways. In such a context, Labour’s constitutional commitment to market economics is anachronistic. The case for re-evaluating the architecture of the economy, for embracing democracy and common ownership, is once again compelling.

Now that Corbynism has secured both the leadership and the party apparatus, there is an opportunity for Labour to write a new mission statement. But that does not mean a return to the wording of the old Clause IV. We should be inspired by the socialist commitments of the past — such as our first 1974 manifesto, which pledged to bring about ‘a fundamental and irreversible shift in the balance of power and wealth in favour of working people and their families.’ But a Clause IV for today must resonate with our supporters as the original did 100 years ago, as a compelling vision of a future in which the control of our lives is wrested back from the propertied elite.

It should affirm socialism as the extension of democracy to every part of society: not just the political realm, but the economy and the workplace too. To achieve this, it should commit to democratic control of industry, utilities, and services by workers, consumers, service users, and communities. It should commit the party to throw off not only the shackles of class, but of any injustice which diminishes and degrades people, declaring Labour’s central mission as the elimination of all forms of exploitation and oppression from society. It should concern itself not only with work but with life, committing to maximise the leisure time of workers and asserting the universal right to creative expression and intellectual development. And it should commit to a sustainable economy that defends humanity and the planet from the threats posed by climate change.

Such a statement would correspond to our moment of history just as Tony Blair’s reforms corresponded to his. It would affirm Labour’s current political shift not as an accident or an aberration, but as a realignment made necessary by the crisis of capitalism. It would say that in an era where wages stagnate, wealth concentrates, and growth is anaemic, the fundamental architecture of the economy must be open to debate once again. It would insist that the decline of the liberal centre and the rise of the radical right should be met not with despair, but with the confidence of a socialist vision of the future.

A century after the party adopted the first Clause IV, it is time for Labour to make clear that it is here not to tinker with a broken system but to build a new society altogether.