AH Challenge: Progressive Deregulation in the US & UK

As someone who comes from the 'North Atlantic Anglo-American' perspective of recent economic history, it has always struck me as strange and fascinating to read how Australia and New Zealand pushed through neoliberal market reforms under ostensibly centre-left social democratic Labor governments (My knowledge of Hawke-Keating is considerably greater than 'Rogernomics,' but as I understand the trends were generally analogous in NZ).

My own reading of it is, coloured as it is by my own political biases, is that Bob Hawke and Paul Keating were able to do for Australia, what Ronald Reagan did to America and what Margaret Thatcher did to Great Britain (that is they were able to revitalize moribund, industrial economies through free market deregulation and integration into the globalized economy, creating in their place dynamic & competitive modern economies & financial sectors) without creating too much inequality, and without also catalyzing the forces of 'dog-whistle populism & Christian fundamentalism' in the case of the Reagan Republicans, and traumatic class warfare in the case of Thatcher.

The reason I would say this is that the Australian (& NZ) middle class appear to be a lot stronger and seem to have more sustainable economic prospects than their American and British counterparts; with as these articles state 50% real wage increase in AUS compared to the stagnant trends in the US:

"In the 80s and 90s, the Hawke-Keating governments turned policy orthodoxy on its head and deregulated the product, capital and labour markets. The reforms were driven by pragmatism and necessity, not ideology. And the benefits to the Australian economy are enduring. Keating, despite some claims to the contrary, remains in the embrace of those policies. “The deregulation optimised the economic opportunities for Australia and produced 25 years of continuous economic growth, a massive increase in personal wealth and a 50 per cent increase in real wages, with low levels of unemployment and inflation,” he says. “The policies worked a treat." Source

Meanwhile in the US:
"Though productivity (defined as the output of goods and services per hours worked) grew by about 74 percent between 1973 and 2013, compensation for workers grew at a much slower rate of only 9 percent during the same time period, according to data from the Economic Policy Institute." Source

Basically, as I see it, the Oceanians were able to do free markets but get away with the most socially inclusive outcomes possible. Of course, some of the nastiness came in the form of Pauline Hanson and a little bit of it from the Howard Liberals, but by and large the record of AUS & NZ looks a lot better than the US & UK.

My AH challenge would be to come up with a scenario where the US & UK pursue 'progressive deregulation' under centre-left governments akin to what happened down under. My own best bet would be Robert F. Kennedy or perhaps a second Carter term in place of Reagan, and someone like Roy Jenkins at the head of the SDP in place of Thatcher. But feel free to go in any direction within these general parameters and be as detailed or not as you'd like.
 
Have deregulation be focused on small enterprises as a distributist measure - essentially taxing conglomerates and industry leaders via retained regulation while using sliding scales of compliance for small to medium businesses.

For example, with environmental issues, a small company's manufacturing plant may be dirtier than a state of the art megacorp plant, but the small company may have most of its employees nearby in a less congested area (saving on auto pollution) and there wouldn't be the enormous pollution and disruption caused by moving across the country as much.

Or in the financial world, you get Sarbabes-Oxley's sliding scale on steroids, with more teeth on huge companies and compliance subsidies for smaller enterprises. It would also likely involve much more robust antitrust enforcement, again, against the big guys.
 
It worked considerably less well in New Zealand for various reasons, not least that Roger went a bit mental after being cooped up in the Treasury for three years.

For this to happen in Britain (and we have to remember that Wilson closed more mines than Thatcher did, so it would be a mistake to say that it all went to shit from 1979 on) you need the key people to be neither doctrinaire left-wingers nor union men - so Healey winning the leadership election of 79 and entering Downing Street in 83 isn't as obvious a solution as you might think. The best bets would be people like Jenkins and Owen and Edmund Dell, and even Tony Benn if he stopped courting the membership and carried on with his development as Postmaster General.

Come to think of it, Benn wouldn't be a bad pick for a Lange analogue.

So you can either do it with Labour getting back in at the 82/3 election and carrying on Thatcher's work, or alternatively have Thorpe make a deal with Heath in 1974, allowing a new Labour broom in at the next election, just in time for Friedman to win the hearts of Finance Ministers the world over.
 
Have deregulation be focused on small enterprises as a distributist measure - essentially taxing conglomerates and industry leaders via retained regulation while using sliding scales of compliance for small to medium businesses.

For example, with environmental issues, a small company's manufacturing plant may be dirtier than a state of the art megacorp plant, but the small company may have most of its employees nearby in a less congested area (saving on auto pollution) and there wouldn't be the enormous pollution and disruption caused by moving across the country as much.

Or in the financial world, you get Sarbabes-Oxley's sliding scale on steroids, with more teeth on huge companies and compliance subsidies for smaller enterprises. It would also likely involve much more robust antitrust enforcement, again, against the big guys.

These kinds of policies appear to gel with Elizabeth Warren-style Jeffersonian left-wing, market populism (as described below) but I wonder who in the US could have implemented it in the 1970s & 80s, and what trajectory American liberalism would have taken in relation to the party coalitions & post-New Deal realignments? Would the Dems have kept working-class whites/ethnics along with blacks & other minorities, plus a progressive portion of business? How do Republicans react? Do they go the way of Buchanan/Trump and attempt to continue the poaching of working class whites from the Democrats, but through economic nationalism in opposition to their opponents' cosmopolite neoliberalism, sort of like what's happening today but two decades ago.

It would be interesting to see a presidential contest between a pro-market Democrat and a Keynesian Republican (an American analogue of the Australian election of 1983 between Hawke & Fraser). Maybe a Jerry Brown/Jimmy Carter vs. Charles Matthias/John V. Lindsay ticket in '76 or '80? Or alternatively a pro-market Democrat versus a paleoconservative nationalist Republican later on, say Bill Clinton vs. Pat Buchanan in '92?

"A raw, moralistic conception of fairness—that people shouldn’t get screwed—would become the basis for her crusading. Although she shares Bernie Sanders’s contempt for Wall Street, she doesn’t share his democratic socialism. “I love markets—I believe in markets!” she told me. What drives her to rage is when bankers conspire with government regulators to subvert markets and rig the game. Over the years, she has claimed that it was a romantic view of capitalism that drew her to the Republican Party—and then the party’s infidelity to market principles drove her from it." (Source)

It worked considerably less well in New Zealand for various reasons, not least that Roger went a bit mental after being cooped up in the Treasury for three years.

For this to happen in Britain (and we have to remember that Wilson closed more mines than Thatcher did, so it would be a mistake to say that it all went to shit from 1979 on) you need the key people to be neither doctrinaire left-wingers nor union men - so Healey winning the leadership election of 79 and entering Downing Street in 83 isn't as obvious a solution as you might think. The best bets would be people like Jenkins and Owen and Edmund Dell, and even Tony Benn if he stopped courting the membership and carried on with his development as Postmaster General.

Come to think of it, Benn wouldn't be a bad pick for a Lange analogue.

So you can either do it with Labour getting back in at the 82/3 election and carrying on Thatcher's work, or alternatively have Thorpe make a deal with Heath in 1974, allowing a new Labour broom in at the next election, just in time for Friedman to win the hearts of Finance Ministers the world over.

Jenkins and Owen would seem to be the most plausible candidates.

In your Benn-Lange analogy, who can be the Roger Douglas-type Chancellor and would a raging socialist like AWB even tolerate it?

Imagine the UK having Bob Hawke-style 'Economic Summits' with labour and capital sitting together hashing things out rather than miners rioting in the streets. A very different rendition of 1980s Britain indeed.
 
Jenkins and Owen would seem to be the most plausible candidates.

In your Benn-Lange analogy, who can be the Roger Douglas-type Chancellor and would a raging socialist like AWB even tolerate it?

Imagine the UK having Bob Hawke-style 'Economic Summits' with labour and capital sitting together hashing things out rather than fighting it out on the streets. A very different re
That's the thing, Wedgie didn't become a 'raging socialist' until after he had left the Wilson Government, so a mid 70s PoD could make him a downright centrist leader.

I think Dell would be the best faceless Douglas analogy, but others work as well.
 
So far as the UK goes you aren't going to get much in the way of deregulation of any kind from Labour if the unions are setting the party's agenda to the extent they did in the 1970s. So you would have to go back earlier and give In Place of Strife a chance. But that's tricky because if Callaghan hadn't made himself the unions' standard-bearer in 1969, someone else would have. (Of course Callaghan eventually came a cropper precisely because of the union movement he'd championed; not much gratitude in politics, though there is sometimes a certain rough justice.)
 
My understanding is that most of what happened under Keating was fairly peculiar to Oz economic management. I mean, one of the hallmarks of his time as treasurer is that epitome of peak 1970s UK politics, voluntary wage restraint from the unions!

Even Sunny Jim found that one difficult over here.

I think you can junk any idea of Labour going down a sort of quasi-Thatcherite route. Even the SDP weren't, in any real sense, Thatcherite. The right of Labour wouldn't - couldn't - have aped Thatcher, not by a long chalk. If the UK had transitioned to an alternate mode of economic management I think it would have been a very incremental thing, and would have been what was called back in the day a 'social market' economy.

The ALP is a completely different thing to UK Labour, not just another breed, pretty much an entire species. The core of what happened in the UK isn't 'deregulation' in any case, it's the UK moving beyond the power of King Union.
 
The key point of difference between the Australian experience and the New Zealand experience is that the former was consultative, pragmatic, and not a complete violation of what the ALP stood for (Hawke and Keating are not personae non grata). The latter was, to coin a phrase, Jonestown-level batshit crazy. Note though that New Zealand Labour's Thatcherism did not extend to the labour market and unions - they restored compulsory union membership, amongst other things. It was the subsequent National Government that destroyed the unions.

To get a replication of New Zealand:

  • You need the previous conservative government to be control-freak interventionists, keen on raising the drawbridge to the outside world. Note also that Muldoon had a sort of odd "worthy opponent" thing going with the unions - they didn't like each other, but they respected each other. Quite different from Heath. Perhaps if Enoch Powell had somehow embraced Peter Shore-type economics?
  • The above is very important, because it provided the excuse for Rogernomics. If New Zealand Labour had won 1978 or 1981, or if the National Party caucus had rolled Muldoon for Talboys in 1980, New Zealand's 1980s would have been less extreme.
  • You need some affable figurehead with enough charisma to keep the left of the party in line at least temporarily.
  • You need the parliamentary party to be infiltrated sufficiently with neoliberals that the wider party struggles to fight back.
 
So far as the UK goes you aren't going to get much in the way of deregulation of any kind from Labour if the unions are setting the party's agenda to the extent they did in the 1970s. So you would have to go back earlier and give In Place of Strife a chance. But that's tricky because if Callaghan hadn't made himself the unions' standard-bearer in 1969, someone else would have. (Of course Callaghan eventually came a cropper precisely because of the union movement he'd championed; not much gratitude in politics, though there is sometimes a certain rough justice.)
OK, in this scenario, Castle & Wilson turn In Place of Strife into law; fractured Labour hands power to Heath's Conservatives for the next two elections, significantly moderated (though not yet militant free) Labour comes back in '79 under... Callaghan? With Jenkins/Owen/Dell as Chancellor? But at this point, what would have been the course of the previous ten years of British and Union politics post-IPOS?

My understanding is that most of what happened under Keating was fairly peculiar to Oz economic management. I mean, one of the hallmarks of his time as treasurer is that epitome of peak 1970s UK politics, voluntary wage restraint from the unions!

Even Sunny Jim found that one difficult over here.

I think you can junk any idea of Labour going down a sort of quasi-Thatcherite route. Even the SDP weren't, in any real sense, Thatcherite. The right of Labour wouldn't - couldn't - have aped Thatcher, not by a long chalk. If the UK had transitioned to an alternate mode of economic management I think it would have been a very incremental thing, and would have been what was called back in the day a 'social market' economy.

The ALP is a completely different thing to UK Labour, not just another breed, pretty much an entire species. The core of what happened in the UK isn't 'deregulation' in any case, it's the UK moving beyond the power of King Union.
I understand that but an underlying premise of this thread is that there was enough objective economic commonalities/emerging neoliberal consensus among the late industrialized economies of the West so that whoever happened to end up in power would have had to pursue some measure or another of deregulation. Of course it mattered who and which side of politics was undertaking the reforms, enough so, as the OP states, that you get noticeably different kinds, degrees and inflections of deregulation with significant divergences in social/cultural outcomes two to three decades later, even if within the same parameters of neoliberal free market ideology. The greatest example of this from OTL, even more than Hawke-Keating & Rogernomics, was of course the great socialist tribune, President Mitterand of France, who came into office promising a return to the golden age of industrial social democracy and who left a decade and a half later, having presided over the modernization of the French economy in the direction of free markets and European/global integration. Someone like Roy Jenkins or David Owen under a moderated Labour or an ascendant SDP doing the same for Britain looks less implausible in light of what actually happened across the Channel.

The key point of difference between the Australian experience and the New Zealand experience is that the former was consultative, pragmatic, and not a complete violation of what the ALP stood for (Hawke and Keating are not personae non grata). The latter was, to coin a phrase, Jonestown-level batshit crazy. Note though that New Zealand Labour's Thatcherism did not extend to the labour market and unions - they restored compulsory union membership, amongst other things. It was the subsequent National Government that destroyed the unions.

To get a replication of New Zealand:

  • You need the previous conservative government to be control-freak interventionists, keen on raising the drawbridge to the outside world. Note also that Muldoon had a sort of odd "worthy opponent" thing going with the unions - they didn't like each other, but they respected each other. Quite different from Heath. Perhaps if Enoch Powell had somehow embraced Peter Shore-type economics?
  • The above is very important, because it provided the excuse for Rogernomics. If New Zealand Labour had won 1978 or 1981, or if the National Party caucus had rolled Muldoon for Talboys in 1980, New Zealand's 1980s would have been less extreme.
  • You need some affable figurehead with enough charisma to keep the left of the party in line at least temporarily.
  • You need the parliamentary party to be infiltrated sufficiently with neoliberals that the wider party struggles to fight back.
How about helping me fill in the blanks? PM Enoch with Shore-type economics seems implausible given that the former was a diehard free marketeer. Does anyone in the Conservative Party of the 1970s fit the bill of 'control-freak interventionists'? In line with the above scenario, 'affable' brings to mind Sunny Jim and the neoliberal infiltration of Labour could commence at the behest of what in OTL became the SDP-wing, while the party fights a civil war between the moderates and the militants in the opposition benches of the 70s?
 
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How about helping me fill in the blanks? PM Enoch with Shore-type economics seems implausible given that the latter was a diehard free marketeer. Does anyone in the Conservative Party of the 1970s fit the bill of 'control-freak interventionists'? In line with the above scenario, 'affable' brings to mind Sunny Jim and the neoliberal infiltration of Labour could commence at the behest of what in OTL became the SDP-wing, while the party fights a civil war between the moderates and the militants in the opposition benches of the 70s?

That's the thing - I am honestly stuck at coming up with a British Muldoon analogy. You can find people who have his social views, or his economic views, but not both at the same time (hence the sort of weird Powell-meets-Shore approximation). The US comes closer with Nixon, but even that doesn't quite capture it.

Callaghan was simply too experienced and too connected to the party's working class base to be a Lange - Callaghan was Old Labour Right, whereas Lange was middle-class liberal with a conscience and an extraordinary speaking ability, but little actual political nous. As suggested above, a Tony Benn who doesn't swing Left might actually be a better candidate. Bonus points if Benn's Government keeps the Left onside by adopting unilateral nuclear disarmament and other progressive social policies*, while deregulating and privatising.

*Remember that another thing about the 1980s New Zealand Labour Government was that it was socially liberal as well as economically liberal, the polar opposite of Muldoonian conservatism.
 
I understand that but an underlying premise of this thread is that there was enough objective economic commonalities/emerging neoliberal consensus among the late industrialized economies of the West so that whoever happened to end up in power would have had to pursue some measure or another of deregulation. Of course it mattered who and which side of politics was undertaking the reforms, enough so, as the OP states, that you get noticeably different kinds, degrees and inflections of deregulation with significant divergences in social/cultural outcomes two to three decades later, even if within the same parameters of neoliberal free market ideology. The greatest example of this from OTL, even more than Hawke-Keating & Rogernomics, was of course the great socialist tribune, President Mitterand of France, who came into office promising a return to the golden age of industrial social democracy and who left a decade and a half later, having presided over the modernization of the French economy in the direction of free markets and European/global integration. Someone like Roy Jenkins or David Owen under a moderated Labour or an ascendant SDP doing the same for Britain looks less implausible in light of what actually happened across the Channel.

I think you're making a mistake in mixing up Mitterand with all this. I just don't recognise his program as compatible with this sort of neoliberal dialectic thing you've got going on in this argument. Sure, he swung away from the Common Programme, but that was pretty extreme stuff anyway to me; he went from an attempt at command Socialism, the sort of thing Tony Benn et al advocated in Britain, to continental Social Democracy, not to anything really easily intelligible in a Hawke-style, still less Rogernomics way. In so far as there were minor deviations, from what I remember they came from the Chirac and Balladur governments. But the two experiences are really divergent, as I say, I just don't get where you're coming from on this one.

Also, as I said in the earlier post, deregulation in the sense I would primarily associate the term is not in itself the central factor in the Thatcher transformation, which also leads me to believe you're putting too much undue stress on the Australian and New Zealand experiences echoing at a global level.

I would agree that something close to the Mitterand experience could have happened in Britain, but I don't think the Mitterand experience was what you actually think it was in being a bedfellow of what went on elsewhere. What you're really asking for is a means of achieving a sort of British social market/'mixed economy', which would be a totally different thing from OTL Thatcherism, which is the core of the kind of global 'deregulation' phenomenon you describe as it manifested in Britain. What you're asking for without being cognisant of it is a British course away from anything like historical 80s 'deregulation' in Britain. I mean - that would be a step away from the post-war British economic consensus, but not enormously, not in a way that would obviously make it compatible with the kind of approaches you've described.

If what you really want is an exact analogue of what Mrs Thatcher did, coming from any kind of left-wing position, then as I said, it's just not going to happen because what Mrs Thatcher did was so fundamentally at variance with the existing political establishment and political culture in all parties, including her own. Thatcherism was not the most likely phenomenon to win out even within the Conservatives; her way of thinking within Labour was not even ultra-marginal, it was really just absolutely off the map. Again, to be honest I think you're working too closely off the Australian and New Zealand experiences and expecting it to be easily replicated elsewhere.
 
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I think you're making a mistake in mixing up Mitterand with all this. I just don't recognise his program as compatible with this sort of neoliberal dialectic thing you've got going on in this argument. Sure, he swung away from the Common Programme, but that was pretty extreme stuff anyway to me; he went from an attempt at command Socialism, the sort of thing Tony Benn et al advocated in Britain, to continental Social Democracy, not to anything really easily intelligible in a Hawke-style, still less Rogernomics way. In so far as there were minor deviations, from what I remember they came from the Chirac and Balladur governments. But the two experiences are really divergent, as I say, I just don't get where you're coming from on this one.

Also, as I said in the earlier post, deregulation in the sense I would primarily associate the term is not in itself the central factor in the Thatcher transformation, which also leads me to believe you're putting too much undue stress on the Australian and New Zealand experiences echoing at a global level.

I would agree that something close to the Mitterand experience could have happened in Britain, but I don't think the Mitterand experience was what you actually think it was in being a bedfellow of what went on elsewhere. What you're really asking for is a means of achieving a sort of British social market/'mixed economy', which would be a totally different thing from OTL Thatcherism, which is the core of the kind of global 'deregulation' phenomenon you describe as it manifested in Britain. What you're asking for without being cognisant of it is a British course away from anything like historical 80s 'deregulation' in Britain. I mean - that would be a step away from the post-war British economic consensus, but not enormously, not in a way that would obviously make it compatible with the kind of approaches you've described.

If what you really want is an exact analogue of what Mrs Thatcher did, coming from any kind of left-wing position, then as I said, it's just not going to happen because what Mrs Thatcher did was so fundamentally at variance with the existing political establishment and political culture in all parties, including her own. Thatcherism was not the most likely phenomenon to win out even within the Conservatives; her way of thinking within Labour was not even ultra-marginal, it was really just absolutely off the map. Again, to be honest I think you're working too closely off the Australian and New Zealand experiences and expecting it to be easily replicated elsewhere.

Sorry for the delayed reply. I understand that no general label for the complex, global order market-oriented economic transformations of the 1980's can suffice, I simply chose 'deregulation' as opposed to 'neoliberalism' or 'free market fundamentalism' what have you, simply because all the other terms are similarly problematic, and that the distinct national contexts and flavours existing in the countries here discussed would prevent any measure of exactitude in the analogies I'm asking for. The distance traveled by Britain from Thatcher to Blair is greater than that between Mitterrand and now, the beginning of the Macron era all the more can be said when you take in the American and Oceanian examples. All I am asking for are rough counterfactual analogies that would reproduce in broad terms the notion of left-wing socialist/social democratic governments implementing market reforms - that as I said in the OP, seem stranger than fiction from someone brought up in the largely self-referential 'North Atlantic Anglo-American' economic worldview, and the hard left-right/capitalist-socialist rhetorical dichotomies prevalent therein.

Deregulation actually pretty much started under Carter:

(1) Trucking deregulation: https://en.wikipedia.org/wiki/Motor_Carrier_Act_of_1980

(2) Airline deregulation: https://en.wikipedia.org/wiki/Airline_Deregulation_Act

See also https://en.wikipedia.org/wiki/Alfred_E._Kahn
Yes, I understand and that is why I posited a second Carter term as a possible scenario in the OP.

Also, any more American scenarios out there?
 
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