Speculation about the character of Ukania’s incoming Labour government tends to be projective. For the self-described Marxist Paul Mason, Keir Starmer’s outlook is ‘socialist and internationalist’, for the New Statesman’s George Eaton it is informed by a ‘quiet radicalism’, for the centrist political scientist Steven Fielding it is ‘soft corporatist’, while for the Blue Labourite Maurice Glasman it is ‘profoundly conservative’. Many Starmer loyalists who see what they want to see in his programme will inevitably be deflated by its realization. Among them, the Observer columnist Will Hutton is no stranger to such disappointment. His 1995 bestseller, The State We’re In, surveyed the legacy of Thatcherism—poverty wages, industrial atrophy, societal decay—and presented Tony Blair, a leader ‘explicitly committed to developing a British social democracy’, as a prospective saviour. The book, along with its spin-offs, The State to Come (1997) and The World We’re In (2002), advocated a humane capitalism to replace the acquisitive variety that had taken hold of Britain and America, arguing that the interests of shareholders should be reconciled with those of ‘stakeholders’, meaning society at large.

Hutton outlined the reforms on which this vision depended: constitutional (an elected second chamber, meaningful devolution, proportional representation), economic (tighter regulation of the City, regional investment banks, renationalization of utilities) and social (universal welfare entitlements, state employment schemes, a national insurance fund). Yet upon entering Downing Street, Blair made clear that his priorities lay elsewhere, slashing welfare for single mothers and disabled people while preparing to bomb Iraq. New Labour, remarked Hutton at the turn of the millennium, had decided that ‘discretion was the better part of valour’ and that his advice was not wanted. Now, a quarter century later, history appears to be repeating itself. With Labour once again on the cusp of power, Hutton has written another treatise—passive-aggressively titled This Time No Mistakes—on how to humanize British capitalism. Starmer, he tells us, is a ‘radical who can transform the country’ and ‘launch a progressive revolution’ that will strike the proper balance between collectivism and individualism. All that’s needed is for the party to maintain its unity of purpose and recover its left-liberal philosophical tradition, too often neglected under previous leaderships.

Hutton was born in 1950 in Woolwich, where his father, a former captain in the Royal Artillery, worked at the local munitions factory. He studied economics and sociology at Bristol and received an mba from the European Institute of Business Administration, immersing himself in the writings of Ricardo, Smith and Marshall. Following a stint as an equity broker he became the economics editor at Newsnight and then at the Guardian before ascending to the top of the Observer. A grandee of consultancies and think tanks, Hutton co-chairs a business ethics consortium called ‘The Purposeful Company’ and directs a space technology firm. He spent the 2010s running an Oxford college and has since taken up positions at lse and the Academy of Social Sciences. Although he resents the fact that Blair shunned his advice in favour of an ill-fated alliance with American neoconservatism, Hutton still sees the Labour right as his intellectual home, and believes that the ‘mistakes’ of its last administration can be redeemed by the next one.

Hutton’s new book starts from the premise that commercial enterprise is not about profit maximization. It is about serving a social purpose; surplus is merely a felicitous byproduct. ‘These are truths that the best in business and finance know, but they have to genuflect to a right-wing culture that tries to deny them.’ The opening chapters chart the rise of this culture in the uk and the us, where it unravelled the achievements of Attlee and Roosevelt and set the stage for secular decline. Hutton stresses the common trajectory of the Atlantic powers, whose ‘ideological missteps’ led them away from a healthy post-war settlement into a free-market maelstrom that culminated in the twin horrors of Brexit and Trump. This has left them vulnerable to the civilizational threats of the twenty-first century: the rise of ‘Leninist’ China and ‘neofascist’ Russia, the take-off of ai, the menace of climate change. Luckily, though, Biden has revived the spirit of the New Deal and confronted these crises head-on, using state intervention to trigger massive private investment while standing firm against the West’s antagonists. Starmer is primed to follow suit. But to succeed, warns Hutton, he must articulate a coherent ideological alternative to neoliberalism: a synthesis of ‘New Liberalism (or social liberalism) and social democratic labourism, at whose core is the ethic of socialism’.

Hutton proceeds to trace the lineage of this alternative, starting with Adam Smith—a ‘hidden man of the left’ who championed progressive taxation and public education, recognizing that capitalist development relied on strong collective institutions. On this front, Hutton contends, ‘Britain was a European pioneer’, creating an ‘embryonic social contract’ with the 1597 Poor Law, establishing the Bank of England in 1694 and requiring each of its native companies to ‘declare the purpose for which it was incorporating’, ‘ensuring that capitalism’s private values align, to some extent, with social values’. The problem was that such institutions developed slowly and organically, rather than through any coordinated plan. They were ‘taken as givens’, and their role in driving the Industrial Revolution was neglected. This oversight made the market seem like a miraculously self-regulating system and thereby enabled the creed of laissez faire: a vapid utopianism which had seduced the political establishment by the mid-nineteenth century, creating an economic model that was short of productive investment and excessively reliant on the empire.

Marxism proved to be a useless antidote given its false assumption that capitalism was beset by insoluble contradictions. More promising, in Hutton’s view, were the New Liberal theories of Green, Hobson and Hobhouse, which deepened Smith’s insights by emphasizing the reciprocal relationship between the individual and society: the forms of ‘social action and social ownership’ that underpin accumulation. These thinkers exerted a direct influence on the Liberal governments of 1906–14, which introduced National Insurance, redistributive taxes and educational entitlements as part of an incipient welfare state. Yet their gains were rolled back in the wake of the Great War, when Lloyd George yielded to elite pressure for austerity, discrediting his party and allowing Labour to surpass it. MacDonald likewise relapsed into fiscal orthodoxy at every crucial juncture, practising a ‘defensive moderation’ rather than extending the reformist project. As Liberalism and Labourism betrayed their ideals, Britain opted for the Imperial Preference—‘tariffs behind which monopolies and cartels grew, little stimulus to drive innovation, high profit margins that allowed the financial system to remain disengaged from business’—in lieu of social democracy. Whether in or out of office, the Tories continued to set the national agenda throughout the 1930s.

In the background, though, progressive intellectual currents were advancing. Tawney mapped the coordinates of ‘ethical socialism’—that property must serve a social function and opportunity must be equalized—while Keynes translated the ideas of New Liberalism into practical macroeconomic policy. It took the Second World War to impress these precepts upon the Labour leadership, which began to build a popular and compassionate social order in 1945. Yet here the party made what Hutton sees as two fateful errors. It cast its welfare programme as a socialist endeavour rather than a liberal one, making it an easy target for the anti-communist right; and it ‘did not touch the deep structural weaknesses from which the economy was suffering’, failing to ‘dismantle the imperial defensive system and become a developmental state’.