Post-war British democratic socialism has tended to define itself in relation to the changing nature of the capitalism in which it has been embedded. In the period from 1945 to the early 1970s that capitalism was of an organized or managed kind. It was a capitalism that had emerged chastened from the trauma of the inter-war period. Bretton Woods, Keynes and Beveridge were all embraced with greater or lesser enthusiasm and market forces constrained, channelled and sometimes abrogated in ways that opened up space for the articulation and pursuit of democratic socialist programmes. In large measure that space was occupied by Keynesian social democracy, with its pursuit of full employment, its commitment to redistribution, its extension of social welfare provision and its adherence to the notion of a mixed economy.

In the 1970s the demise of Bretton Woods, the onset of stagflation, the re-emergence of mass unemployment, the seeming inefficacy of Keynesian instruments of macroeconomic management and the increasingly self-confident iteration of a free market ideology combined to usher in a different kind of capitalism – a disorganized capitalism no longer informed by a belief in the need for the state to pursue an equilibrating and redistributive role if it was to survive. The Anglo-American capitalist model had never been as ethically, structurally, institutionally or culturally constrained as its Nordic, Rhenish or Japanese variants, but the economic crisis of the 1970s allowed it to cast off most of what had previously restrained it. And that in turn demanded a radical reconfiguration of the political economy of democratic socialism.