After the devastating defeat on the hands of the conservatives in 1979, the torn Labour party had to go through a series of changes to reassert its internal structure and organization. From the Bennite Challenge that redressed and centralized the power of decision making inside the party to the rejection of nationalization and crushing the revolutionary left, these shifts in Labour policies acted only as stepping stones for Tony Blair towards a ‘ New Labour’. It was in his term that the Labour party change of ideology finally crystalized to create an ideological, social, and economic contrast with Old Labour.
The first key difference between Old and New Labour is the change of ideology. The Labour party was founded on socialist values as an opposition to the liberal values of the conservatives. These values were stated in Clause IV of the party’s manifesto of election in 1918 and continued to be the backbone of the post-war policies of the party.
This socialist ideology worked well in attracting voters during the post-war decades. However, after the Winter of Discontent 1978, it had grown stale in the eyes of the British for they no longer trusted the party. The New Labour had to sell its manifesto with a new brand to regain the people’s trust.
Therefore, Blair and other modernizers rejected Clause IV and decided to try another electoral appeal. They adopted an ideology that tempered the individualism of neo-liberalism with traditional ethical socialist values in an attempt to appease and attract voters.
The change of the party’s ideology has begotten a change in social policies as well. The Old Labour attempted to lay the foundation for a more caring and egalitarian society through the implementation of large welfare and the reduction of unemployment. They adapted collectivism for the advancement of working class. They also had unions to defend the rights of the poor.
In contrast, the New Labour attempted to reconstruct the state with more democracy and individual responsibility based on self-help as a way to eradicate dependency. They implemented a smaller welfare state based on “hand up, not hand out”. They believe that the individual and the community should exist for each other’s benefits. This highly reflects the effect of the liberal -Thatcherite values on the New Labour.
The most important key difference between the Old and New Labour lies within the change of economic policies. The old Labour believed in a social oriented economic policy. They implemented Keynesian policies to face recession, which of course required state intervention. They nationalized the key industries, increased spending on the public sector, and lowered the taxes.
New Labour however believes in a more liberal-socialist economy. They combine neo-liberal economic with social ethics. This means they support the free market and the privatization of industry that is based on equality, fraternity, self-improvement and moral rectitude.
To sum up, political parties evolve and change their ideologies to match the evolvement and the change of the voters. The Labour party is not different. Probably they still maintain their old values and only use new ways to achieve them.