Daniel Dieppe: Is Starmer the next Callaghan? | Conservative Home

Daniel Dieppe is a researcher for the think tank Civitas.

Is Sir Keir Starmer the next James Callaghan? On the face of it, that sounds like a ridiculous question. The two men became Labour prime ministers 50 years apart.

Callaghan never won an outright majority, instead inheriting a tiny majority from his predecessor, Harold Wilson. Starmer, on the other hand, won the largest landslide in a generation. While Callaghan represented a working-class constituency in Cardiff, Starmer represents Britain’s chattering classes in North London. These differences, however, mask deep similarities.

Both men took office at a time of serious economic and cultural challenge. Unlike Tony Blair, who governed off the fat bequeathed him by the Tories, Starmer and Callaghan took over from Conservative governments that failed to make Britain a better place. The Tory Government of the 1970s that Callaghan replaced endured five official state of emergencies in four years. Similarly, Starmer followed a flailing government with three prime ministers in two years, a record tax burden, and high immigration.

The problems inherited by both men are essentially the same: powerful economic headwinds, cultural collapse, and broken consensus politics. It’s hard to say who had it worse.

Callaghan, to his credit, tried to solve his problem. In 1976, he told a stunned Labour Party conference that the “cosy world” was gone forever, and a radical new economic approach was needed:

“We used to think that you could spend your way out of a recession, and increase employment by cutting taxes and boosting Government spending. I tell you in all candour that that option no longer exists.”

In short, he called for the end of the post-war consensus. In response, Callaghan was mercilessly attacked by Labour supporters. He received no cheers or standing ovation, like that given to the much more radical Tony Benn a few moments earlier; when Dennis Healey, the chancellor, spoke later that day, he was interrupted by shouts of ‘A Tory policy!’ and ‘resign!’.

The grim reality of the situation was recorded that evening by an extraordinary BBC interview where Callaghan said: “If we were to fall – and I don’t particularly want to make any party political point here – I don’t think another government could succeed. I fear it would lead to totalitarianism of the Left or Right.”

Unfortunately for Callaghan, his new economic policies only succeeded in revitalising the Conservative Party. Milton Friedman, the radical free-market economist, called his speech “one of the most remarkable talks, speeches which any Government leader has ever given.”

Callaghan’s dash to the right gave Margaret Thatcher the clout and political space to radically shift the Tories towards the free market. As one Labour MP put it, monetarism (that is, not spending your way out of recession) was “house-trained by Labour, ready for the Conservatives to turn it into the only instrument of policy.”

His new economic policy, however, failed to save the economy. In 1976, the pound fell seven per cent despite a 15 per cent interest rate. Unemployment remained above one million, and the balance of payments hit £1 billion in the red. Inflation doggedly reached 13 per cent by the end of the decade.

Worse was to come in 1977, as Callaghan headed ‘cap in hand’ to the IMF to ask for a $3.9 billion bailout, the first for an industrialised economy. Austerity measures cut public spending from 46 per cent of GDP in 1975/6 to less than 40 per cent two years later.

Finally the Winter of Discontent, mere months before the 1979 election, saw tonnes of rubbish strewn on the streets, the dead left unburied and millions working days lost from striking. In the end, Callaghan’s political posturing only opened the door to the radical Toryism of the 1980s.

Starmer faces a political consensus as broken as that which faced Callaghan. Britain’s economy simply is not working for most people; real wages have stagnated since 2007; the cost of living has skyrocketed. Perhaps the most damning statistic of economic decline is that far more money is now spent on debt interest payments than on defence.

The country’s problems, however, are also cultural. Less than half of Generation Z are proud to be British, down from 80 per cent twenty years ago. Illegal immigration is forecast to reach nearly 50,000 this year, due to a broken immigration system. There are now over 2000 schools where more than half of pupils do not speak English as their first language. Only a divided society would ever put a schoolgirl adorning a sparkling Union Jack dress in isolation during a cultural celebration day, as happened last week.

Decades of permissive society have led to almost half of teenagers not living with both birth parents, and less than half of adults being married, the lowest rate ever. British children are the most addicted to their phones in the world, wasting on average two hours and seven minutes a day scrolling on TikTok.

Starmer is not the ideal man to end this obviously broken consensus. If anything, he embodies the Blairite consensus of the past 25 years better than anyone else. Starmer is an arch-Europhile, staunch defender of international law above all other moral principles and sound government (see Lord Hermer’s record or the Chagos Islands); typically viewed as a member of the North London lawyerly elite, he believes in almost nothing beyond its shibboleths.

As a result, no-one can take Starmer’s attempts to break the consensus seriously. The abolition of mega-quango NHS England; the largest cut to foreign aid in history; modest cuts to welfare payments; the ‘island of strangers’ speech – all superficially challenge the old Blairite consensus, but were undertaken from an overarching commitment to maintaining it – a disoriented framework for governing.

All Starmer’s posturing achieves, however, is the political validation of Nigel Farage and the right-wing of the Conservative Party. A mass cut to welfare spending, the reform of the quangocracy, and a challenge to absurd levels of immigration does not look nearly as radical in the wake of a Labour prime minister who endorsed similar ideas, but failed to follow them through.

Callaghan was in a similar position. According to historian Phil Tinline, Callaghan was “the embodiment of the consensus.” Benn recorded in his diary on ¹⁵ January 1978: “This is the death of the Labour Party. It believes in nothing anymore, except staying in power.” Today’s Left says much the same of Sir Keir.

Shortly before leaving high office, Callaghan remarked to an aide: “There are times, perhaps every 30 years,” he said, “when there is a sea change in politics. I suspect that there is now such a sea change – and it is for Mrs Thatcher.”

Starmer is in the same boat as Callaghan. Pushed to and fro by the almighty waves of resistance to woke, multiculturalism and the big state, Starmer always seems a rudderless prime minister, even buoyed by the massive majority of 174.

The truth is that there is now another sea change in British politics, aided and abetted by Starmer. But in which direction, and to whose benefit? It went for Thatcher last time; now it is much more uncertain.