From liberal collectivism to neoliberal individualism: labour relations in Britain

Britain as a stronghold of economic liberalism

As I argued in the preceding chapter, it makes sense, in the context of an incorporated comparison concerned with processes of deindustrialization, to zoom in on Western Europe and examine different national cases that reflect the variegation of global capitalism. Britain bears hallmarks of a liberal market economy. Accordingly, the institutions characterizing the British political economy reflect the assumption that the market mechanism allocates resources efficiently: the regulation of the financial sector is comparably ‘light’ (see Gallas, 2010; Tooze, 2018); for- profit, private sector companies and public– private partnerships play an important role in delivering public services (Flinders, 2005; Gallas, 2016: 241– 2); and economic inequality is higher than in the other Western European countries.

Indeed, economic liberalism has deep roots in the country. Paired with colonialism and imperialism, it was a prominent feature of government policy in the age of the British empire in the 19th century. Back then, leading politicians had been promoting the erection of a ‘world market’ based on ‘free trade’ (Arrighi, 1994: 47– 58; Gallas, 2008: 283; 2016: 76, 134– 5). After the Second World War, economic and social policy shifted. Under the postwar settlement between capital and labour, full employment and benefits were traded for union acquiescence. A welfare state was erected, and successive governments started to experiment with Keynesianism and corporatism. But in reaction to a deep crisis of the British political economy and a wave of rank-and-file militancy on the side of organized labour, leading politicians re- embraced, from the mid- 1970s onwards, ‘free market’ ideas. Ever since, the country has been at the forefront of efforts to promote neoliberalism. Governments have been fostering financialization, competition, private ownership of corporations and transnationalization – and have attempted to insulate the economy from interventions from popular, subaltern forces. Today, the country is deeply integrated in global financial networks; indeed, the City of London is not just the centre of the national economy but also one of the hubs of global finance (see Gallas, 2010; 2013; 2016).