During the terminal months of Theresa May’s zombie regime, a group of senior Conservatives launched a top-secret operation, which they code-named “Project Arse” – a title chosen, according to one leading conspirator, “so that everyone knows who we’re talking about”. Like most recent Tory plans, it failed, and the “arse” in question, a man Frankie Boyle once described as “a cross between a brain injury and an unmade bed”, is now Prime Minister.

Boris Johnson may win this election; regardless, the Conservative Party is in deep crisis. The proximate trigger for this is of course Brexit, long championed by those David Cameron referred to as “swivel-eyed loons” and “closet racists” inside and outside of the party he once led. This previously fringe position is now the animating force of the Conservatives, tying their raw political survival to a course of action opposed by the great majority of the capitalist class it has for so long been their job to represent.

Why has this historic dislocation occurred, and how deep is the crisis? To fully grasp its severity and scale – and why it may differ from comparable episodes in the past – we have to understand the role of the party within the British political system across its multiple stages of evolution. In the words of Edward Heath:

“The historic role of the Conservative Party is to use the leverage of its political and diplomatic skills to create a fresh balance between the different elements within the state at those times when, for one reason or another, their imbalance threatens to disrupt the orderly development of society.”[1]

Heath included organised labour as “an element within the state”, reflecting the post-war model of statist capitalism that entered into crisis during his premiership. But this role of “balancing” divergent elements had long been played by the party, not least between different factions of a changing ruling class.

As Nigel Harris explains in the introduction to his 1972 book, Competition and the Corporate Society,

“the Conservatives, once they had freed themselves from a specific Tory identification with the squires of England, sought to make themselves the political voice of the elite groups of British society. Since industrial Britain was in a process of almost continuous change, different elite groups struggled to positions of pre-eminence, while others declined. To make itself the voice of the new was a precondition for Conservative survival.”[2]

This role of mediating between different elite interests, while retaining a “facility for disentangling itself from temporary association with any one group”,[3] has made the Conservative Party supremely suited to the role of state managers. This is reflected by its remarkable political dominance over the course of multiple, fundamental shifts in the social, political, and economic history of the United Kingdom. In adapting to these changes and exercising such a hold over the British state, the Conservatives may reasonably claim to be the most successful and reliable political instrument ever created by the ruling class of a core capitalist economy.

The other side of this relationship is that a crisis in the Conservatives reflects a transitional phase in British and global capitalism, to which the party is struggling to adapt, or more seriously a crisis in capitalism itself which is escaping effective political management in a more general sense. This is confirmed by history and by the obvious fact that the party’s present crisis coincides with and is closely related to the general crisis of world capitalism in its neoliberal phase.

This period, commonly associated with a political crisis for the left, has in the long-term caused severe problems for the Conservatives as a broad centre-right party. More specifically, the hollowing out of state capacity and competence under neoliberalism precludes the careful statecraft and long-term accumulation strategies once considered the hallmarks of Tory rule. Secondly, the ruling class itself has undergone a process of recomposition and fragmentation, gradually undermining the once organic relationship between capital and its hitherto impeccably reliable political representatives.

None of this makes electoral success in the near future impossible, or even particularly improbable. But it does suggest that, if the Conservative Party emerges from its present crisis, it will do so fundamentally transformed.

The Conservative Party, the State, and Neoliberalism

Consider, first, the Conservatives’ role as state managers. To quote Neil Davidson, since the 1970s “neoliberal regimes have increasingly abandoned any attempt to arrive at an overarching understanding of what the conditions for growth might be, other than the supposed need for lowering taxation and regulation and raising labour flexibility”[4]; this is evidenced by the abandonment of policy instruments which once allowed governments to intervene directly in the economy: the abolition of exchange controls, the setting of interest rates by an independent Bank of England, the subordination of state budgets to apparently objective measures of fiscal responsibility.

The growing inability and/or unwillingness of state managers to do other than satisfy the immediate demands of the wealthy reflects the transition from what Wolfgang Streeck terms “the tax state” to “the debt state”. This shift, he explains, “marks a new stage in the relationship between capitalism and democracy, in which capital exercises its political influence not only indirectly (by investing or not investing in national economies) but also directly (by financing or not financing the state itself).”[5] The servicing of debt and the maintenance of favourable credit ratings, rather than any broader economic development, thereby become the overriding objectives of governance.

Austerity regimes exemplify the resulting strategic malaise: very lucrative for the very rich, but as a response to crisis there is little historical evidence that such pro-cyclical fiscal contraction is an effective way of stimulating long-term growth. Lacking the ability to conceive of any viable and stable accumulation strategy, the Conservatives are instead blown between a series of wildly contradictory and purely tactical ideological positions: Cameron’s initial pledge to match Labour spending, following by years of insistence on the necessity of cuts; Theresa May’s doomed flirtation with a half-baked Christian Democratic “Red Tory” authoritarianism, followed by Boris Johnson’s incoherent melange of One Nationism and disaster capital.

The rapid adoption and disposal of this succession of pseudo-strategies not only reflects a disintegration of collective purpose and understanding, but creates an environment in which figures like Johnson can thrive: his only speciality is in chronic, slap-dash short-termism and the reflexive bluster of unprincipled, inbred class arrogance. The party has at least elected a leader who truly reflects its state of being.

Beyond the growing ineptitude of political state managers, the bureaucracy has also steadily declined. The civil service is now half the size as that inherited by Margaret Thatcher. Entire departments associated with economic management have been abolished; once vast institutional knowledge and expertise has been decimated.

Nowhere is this clearer than in the tortuous process of negotiating Brexit. The “impact reports” on the implications of Brexit on various sectors are horrifically lazy cut-and-paste jobs, of which the government is rightly embarrassed, while it is painfully clear that the British state simply lacks the personnel and expertise to negotiate or even comprehend such a wide-ranging economic realignment as leaving the European Union will entail. In the words of David Edgerton:

“the state can no longer undertake the radical planning and intervention that might make Brexit work. That would require not only an expert state, but one closely aligned with business. The preparations would by now be very visible at both technical and political levels…Brexit is a promise without a plan.”[6]

According to this reading, the Brexit debacle is a particularly acute demonstration of the inability of state managers to set a strategic direction for capital in a moment of crisis, a consequence of the delegation of such competencies under neoliberalism to either the private sector or multinational institutions like the EU itself – part of a much wider-ranging technocratic, post-political regime of governance, described so well by Peter Mair in Ruling the Void.[7]

This, of course, is not a problem only for the Conservatives. But, given that party’s exceptionally close association with the British state, and its historic use of the latter to weld divergent elite interests into a coherent political programme, this decline of state capacity and competence poses severe problems for their long-term revival as a party of the entire ruling class able to construct stable hegemonic blocs.

The Recomposition of the Ruling Class

A second long-term consequence of neoliberalism has been a radical recomposition of the ruling class itself. Historically, the British elite – regardless of its changing personnel and marked shifts in evolution – has been an exceptionally well integrated social group. That internal cohesion has now gone.

A basic marker of this shift is the great and rising proportion of foreign ownership of capital on the London Stock Exchange. From under 4% in 1981, this had risen to around 40% by 2010. In 2014, for the first time in history, foreign investors held more direct investment assets in the UK than British capitalists owned abroad: rather than a centre for exporting capital across the globe, the City now provides a low-regulation environment for attracting it from abroad.[8]

While such trends are not unique to the UK, they are unusually advanced: as early as 1990, the ratio of foreign investment to GDP was 21.2% in Britain against an 8.1% average for developed economies, with nearly a third of the 100 largest firms foreign-owned, no “national champions” to speak of, and a Sunday Times Rich List dominated by wealthy foreigners seeking a tax haven.

The difficulty that this posed for the Conservative Party was seen as far back as the early seventies by Nigel Harris. Three years before Thatcher had even been elected party leader, he wrote:

“[The Tories] are again seeking to straddle the increasing gap between an old declining segment of business and a new rising one. But this time, the rising sector is part of a world beyond Britain’s boundaries. And the declining sector constitutes ‘Britain’, part of a heritage Conservatives are supposed to conserve. The leap from a party of small and large national business to one of international companies would be one of the most agile transformations of all for the Conservatives, for it would involve the dissolution of the British national State on which the Conservatives have been for so long dependent. Yet for many Conservatives there seems to be no viable alternative: either internationalisation or suicide.”[9]

A more detailed measure of declining elite cohesion can be found by comparing current networks of interlocking directorships and major shareholdings with historical patterns. A study of these linkages in the British economy between 1904 and 2003 found that since the 1980s:

“Forms of corporatist concentration and relatively high levels of national economic co-ordination have given way to more ‘disarticulated’ national economies with internally fragmented structures.”[10]

Particularly key to pre-neoliberal corporate interlinkage was “a core elite of mutually connected people, centred on the banks, who dominate[d]the big boards and comprise[d]the leading edge of business decision-making”.[11] This “inner circle” constituted the so-called “gentlemanly capitalists” of the City ­– to whom Thatcher took a sledgehammer when pushing through the financial reforms known as the “Big Bang”.[12] In so doing, she inadvertently smashed the economic group which had played a central role in reproducing elite cohesion at the national level.

As the ruling class has changed, so has its relationship to the Conservatives. Over 70% of Thatcher’s first cabinet were corporate directors, collectively serving on the boards of 475 companies.[13] A 1966 survey similarly found that “243 Tory MPs held 290 positions of chairman, deputy chairman, or managing director of enterprises” and only twelve had no recorded outside interests.[14]

These connections were reinforced by the dominance of a handful of public schools and elite universities in the backgrounds of Conservative politicians and businessmen (for they were almost all men) alike: 94% of all Conservative cabinet ministers between 1925 and 1955 were educated at private schools, slightly falling to 83% by 1983. Over three quarters of company directors born between 1920 and 1939 – that is, the post-war business elite – attended private schools, and this dominance was likewise seen throughout the civil service, the military officer class, directors of the BBC, and many other institutions and sectors.[15]

The British elite thus not only shared a common class position, but were bonded by established processes of collective socialisation. The Conservative Party served a particular function within this nexus, with a mass national membership and deep social roots. Writing in the New Statesman, Ferdinand Mount reminisced about a survey he carried out for the Conservative Research Department in the early 1960s regarding the state of the party as a membership organisation. He toured the country and, in his words:

“met with the support of every local business owner worth his salt. There they were…with waistcoats and watch chains: wool merchants in Bradford, steel men in Swansea, carpet makers in Kidderminster, fireworks manufacturers in Halifax.”[16]

The party, with its national network of cheap pubs and elite clubs, provided a shared environment in which the socially conservative worker could identify with the local bourgeoisie, and the owners of small and medium capital themselves could rub shoulders, greet one another with secret handshakes, exercise influence and envisage their own progress to greater prosperity. Such a party did not require formal structures of internal democracy to mediate between local and national, large and small capitals. Through this deep and wide social embeddedness, the Conservatives were able to arrive at the approximation of a general class interest and, financed by the Empire, secure broad social consent for its programmes.

While the ruling class obviously still exists and exercises enormous power, that shared social world is gone. A clear minority of company directors and CEOs, and a slight minority of even Conservative MPs, now attended private schools or Oxbridge. Corporate elites no longer specialise in any particular sector: instead, an overwhelming majority study accountancy, business management and the like. Their only expertise is fomenting in constant, chaotic change: mergers, downsizing, the immediate maximisation of shareholder value, takeovers, and restructures.[17]

Where this elite intersect directly with the Conservative Party, it is no longer as captains of industry, but as representatives of those sections of capital least suited to taking any kind of broad strategic view and, perhaps not incidentally, most in favour of a hard Brexit: witness Johnson’s “government of all the lobbyists”, whose skill sets lie precisely in attempting to further reduce state managers’ room for strategic manoeuvre.[18] They are fittingly led by Johnson, whose only “professional” experience outside politics is as a fiction writer for right-wing newspapers, and whose only skill appears to be the deployment of a reflexive class arrogance that commentators apparently misread as something they call “charisma”.

This process of elite recomposition has severely undermined the organic links which once bound an exceptionally cohesive ruling class to its political representatives. The shock of Brexit has revealed that, for all its near unchallenged recent influence, large, highly international capital is unable to discipline and stabilise the Conservative Party at its moment of crisis, and has itself become highly fragmented. To quote Bob Jessop:

“The state has been unable to act in an effective dirigiste, corporatist, liberal (or, more recently, neo-liberal) manner. Muddling through on a week-by-week basis while trying different grand strategies is its modus operandi…And surprisingly, given how significant Brexit is for the prospects of business and finance, it has taken two years for major commercial, industrial, and financial interests to articulate their positions in public. In part, this reflects the fact that the Balkanisation of the UK economy means that there is no significant national or comprador bourgeoisie that could benefit from Brexit and that the multiple international linkages of capital also block a coherent stance…there is no collective voice of capital.”[19]

The previously tight integration of state and capital, and what we might summarise as the former’s loss of “relative autonomy” under neoliberalism, has given way to a sudden and sharp unmooring, triggered by a political miscalculation by the once trusted party of the ruling class. Lacking the ability to formulate anything resembling a strategic response, all the Conservatives find in this new space is more rope to hang themselves with.

The Unravelling of Conservative Power

Both the ditching of the post-war settlement in favour of neoliberalism and the associated pivot towards European integration were driven by the Conservative Party in response to the crisis of social-democratic, national capitalism. These were rational responses, which correctly identified and adapted to pre-existing, ascendant tendencies and, for a while, more or less effectively managed Britain’s relative decline as an economic power.

Yet the long-term consequences of this reorientation have undermined the ability of state managers to govern strategically, while eroding the once exceptional class solidarity of the British elite and severing its hitherto deep, inbred connection to the Conservative Party.

Meanwhile, the geographical unevenness of neoliberal development, in concentrating wealth in the Southern regions of England, has also seen the Conservative Party retreat to its historic heartlands. Exiled from power during the Blair years, the party clung desperately to its decimated membership and receding support. In doing so, it fostered a petit-bourgeois, “populist” nationalism incipiently hostile to large, international capital, precisely at the moment when the instruments of government through which it might seek a measure of independence from such forces had been cast aside.

As this hostility grew, the previously solid Conservative coalition between large and small capital began to disintegrate. A quarter of small- and medium-sized business owners voted UKIP in the 2014 European elections, with only a very slight majority supporting membership in 2016; over 20% of Conservative members now view big business as exploitative of common people. Rather than alienated northern workers, it was this embittered southern middle class, animated by perceptions of personal and national decline, which primarily drove the Brexit vote.[20]

Precisely as its remaining base began to break from the capitalist class proper, the Conservative Party chose to empower them with a minimal level of internal democracy, allowing the rank-and-file to elect the leader and thus directly influence policy for the first time. Setting itself against the interests of large capital thereby became the price for securing the overriding priority of raw political survival; the vote to leave the European Union both sharpened this internal party contradiction and elevated it to the level of the British state itself, without offering any clear means of resolution.

The squeezed and embittered petit-bourgeois and middle-class layer that railed in the Tory base through their years in the political wilderness has been joined by a minority section of finance capital, primarily hedge-funds with little real connection to the UK economy, chaffing against the threat of tighter regulation at the European level in the aftermath of the 2008 crash.[21]

Brexit is seen as an opportunity to re-assemble something close to the Conservatives’ traditional social base, winning sections of working- and middle-class support in Northern England, even if the rest of the Union seems lost. But the re-heated One Nationism through which the party aims to achieve this reconstitution, with Johnson promising to return rates of government spending to levels last seen in the 1970s, is incompatible with the agenda of the extreme Thatcherite Brexit elite and their international backers.

The Conservatives may still win this election; they might even successfully reinvent themselves, as they have done in the past, and avert what seems likes unavoidable collapse. But, lacking the social, institutional, intellectual and economic assets which allowed the party to emerge from previous crises, any reincarnation is likely to be unstable, improvised, and increasingly reliant on the tactical deployment of a socially combustible, xenophobic authoritarianism to hold itself together. Unlike Thatcher, Johnson has little besides such “psychological compensation” to offer his base: the council houses have been sold, the national companies privatised, the North Sea oil money squandered on tax cuts. Bigotry, Boris will eventually find, doesn’t pay the bills.

The issues faced by the Conservatives are not unique, even if their form is specific to the ways in which the party has been historically constituted and is presently unravelling. At heart, these problems illustrate the diminishing strategic options available to all political managers of neoliberal capitalism and their inability to chart a path out of the slump, let alone effect any global economic reorganisation comparable to those which followed previous world crises. The long and increasingly grotesque Conservative decline is one of many morbid symptoms of this impasse, portending the future that awaits us if no alternative is found.