The Labour Party and the Capitalist Firm, c. 1950-1970

One of the most profound challenges facing the Labour party in the post-war period was its ability to understand and make policy to reform the private sector. Before the Attlee government, Labour had little to say on this issue, but that government's experience exposed the dangerous ‘vacuum’ this involved. In the 1950s the nature of the capitalist firm ranked alongside the alleged ‘embourgoisement’ of the working class as an issue framing Labour's ideological and policy debate. The centrality of this issue reflected the fact that understanding the firm was inextricably linked to a raft of broader arguments within the Left about the nature of modern capitalism. The benign view of the corporation that flowed from the revisionist wing of the party was challenged by the ‘declinist’ politics of the 1960s, and in office after 1964 Labour pursued a modernizing agenda which centrally involved seeking to shape the behaviour of the private sector in order to deliver the higher economic growth that Labour so much desired. The failure of this growth to materialize led to great disillusion across the party about the policies pursued by the Wilson government, and this in turn led to a fundamental rethink of policy that was to underpin the radical agenda of the party in the 1970s.