Economic crisis 1: Wales needs radical transformation

We should all welcome the advent of Gorwel, the new ‘centre-right think tank’ to Wales if only for the novelty value. Wales is economically on the rack and things are going to get a whole lot worse. So contestation between left and right, so normal and healthy elsewhere but so lacking in suffocatingly social democratic (if broke) Wales, is a positive development.

Of course, there was a time when Wales had a vigorous if eccentric radical right. And it is typical of a-historical modern Wales that no-one in this debate has pointed out yet that having a right wing intellectual force in Wales is not that novel. Saunders Lewis’s Plaid Cymru was clearly part of the European Right in the 1920s and 1930s and self-consciously so. Lewis himself despised modern, industrial, protestant, increasingly English-speaking, social democratic Wales and saw the problem as having its origins in the separation of Wales from Catholic Europe. 

Tomorrow: Offa’s Gap In Part 2 of this debate we publish Offa’s Gap: Roots and Remedies of the Welsh Growth Collapse, by Adam Price, former Plaid MP for Carmarthen East and Dinefwr, and now co-chair of the party’s new Economic Commission which is being launched today.

His contempt for modern Wales led him into dark territory, still never fully or honestly acknowledged, in a Wales so suffused with social democratic values that it is literally unthinkable for a Welsh politician to have been as radically right wing as Lewis actually was. “Hitler knows that Wales is a nation,” screamed an editorial written by Lewis in the Plaid paper, Y Ddraig Goch just after the Fuhrer had mentioned positively the burning of the bombing school in Lleyn at a Nuremburg Rally in the late 1930s (I kid you not).

Lewis aligned Plaid with the far right in the European civil war as it was just about to burst into world conflagration in 1939. Throughout the 1930s Plaid supported the dictators who crushed democracy along with the Left – Salazar, Franco, Mussolini and Hitler. Plaid may have favoured the Catholic reactionaries over the atheists in that list, but that never stopped them showing sympathy to all of them.

And when it came to the Second World War the official position of the Welsh Nationalists was that Wales had no quarrel with Hitler. They supported Vichy against the Resistance. If you’d read the Plaid newspaper in the 1930s you wouldn’t be surprised at their stance because they’d argued for some time that Jewish financiers were behind the war momentum in England and France. Lewis had conventional Rightist views on Jews by the way: having previously denounced Lenin as a Jew, he saw Jews as the embodiment of the modernity he fought against. How Lewis got away with his anti-Semitism in post-war Wales is a mystery and every time I have raised it I have been rebuked. 

Yet the evidence is overwhelming. Read what he wrote in the 1930s. Read what his opponents were saying about him at the time. He was fingered as a fascist from early on by his peers but that level of understanding and historical memory was lost in the 1960s. Although Gwynfor Evans may have opposed the War from a pacifist perspective – though he was not averse to giving protection to a Breton nationalist collaborator after the war, on the run from French justice – this was certainly not Saunders Lewis’s position. Lewis was a fellow traveller of the Axis powers and so was his Party under his leadership.

I mention all this not to vilify Lewis, though he did have some unpleasant views. Lewis was a serious if exotic person who raised issues of fundamental importance. He was no British style Conservative. He was what has been termed a ‘Revolutionary of the Right’, like many who returned from the First World War disillusioned with bourgeois democracy and the old guard who ran it. His spirit was closer to the Marxists and Communists than to anyone else – though, of course, he saw them as the real enemy of civilisation. And, despite his ‘nationalism’, like them he felt himself to be part of a wider European movement. Like them, too, he was no democrat.

Of course, being closer to the Catholic wing of European Reaction meant that, in fact, Lewis had little positive to say about capitalism. It’s a Communist myth that fascists everywhere were on the side of Big Capital against the workers. Hitler made a tactical alliance with German big business. However, for every Hitler there was a Salazar or a Franco who saw in capitalism just another form of anti-social modernity. So Lewis was no supporter of Hayekian, neo-liberal economic views. He would have regarded such economics as just another form of godless materialism.

Apart from his influence over the non- and indeed anti-parliamentary methods of the Welsh Language Society, Lewis was too exotic a bloom to take root in Wales. His Welsh Rightism was a dead end. But then so was Welsh Leftism of course.

Neither had much useful to say about the most important event to hit modern Wales: the crisis of the economy after 1921 when the world’s first industrial nation became the world’s first welfare nation, a fate that it never fully escaped during intermittent boom years and which the current recession will confirm.

This Wales has a GDP that’s 74 per cent (and falling) of the UK average, has so many places which have struggled for generations to provide even a bare majority with jobs, and loses 50,000 young people a year to economic emigration. Our population has stagnated for almost a century, having previously seen the fastest growth of any region in the UK. We are poor. We do not need not hand-outs, but rather hand-ups. We need that best of anti-poverty campaigns – a wealth generation campaign. 

The complete failure of devolved government in Wales to develop any kind of economic strategy needs a more considered analysis than is afforded by an essay of this kind. But then the complete failure of any university department in Wales to fill the gap is also worthy of review. Add to this the failure of any political party in Wales to develop an alternative economic strategy – and the space for Gorwel is clearly there. The need to develop this economic thinking is certainly there. I add: while the IWA has done some good work I feel that it has dissipated its effort in too many directions.

Essentially, the task for any such thinking is about how to make Wales wealthier. Everything else is a detail. In the modern era, beyond welfarist thinking or crude neo-classical economics, this means working out what the role of government in and for Wales is in creating effective markets and enabling competitive and productive enterprises to emerge.

The Welsh political class has recently got itself obsessed about getting hold of ever-greater power for the National Assembly without actually seeming to know what they would do with it. Gorwel and the IWA need to work on the agenda of how we use what powers Wales has now to achieve a radical economic transformation over the next 25 years. Nothing else matters.

My worry already about Gorwel, apart from not having serious resource to make a serious contribution, is that it won’t be radical enough. Whatever one thinks about the Institute for Economic Affairs it was fearless and changed the UK fundamentally as a result. That’s what Gorwel needs to aspire to for Wales, otherwise there is no point.

Last point. While Saunders Lewis had nothing to say of any importance about the economic regeneration of Wales – his call for a return to medieval guilds and an agrarian economy bounced off modern Welsh reality for good reasons – his radicalism and fighting spirit had something going for them. Wales needed revolutionising whether from the Right or the Left. Instead it got welfarism and palliatives. In contemporary terms we got neither the Washington Consensus (radical anti-state) nor the new Beijing Consensus (radical use of state). We got the consensus of the graveyard. Someone needs to smash this consensus in Wales – and it matters less that it comes from the Right or the Left than that it comes from somewhere.