The New Few, By Ferdinand Mount

An intellectual father of the 'Big Society' flays the misdeeds of the oligarchy - then lets them off the hook.

Who invented the "Big Society"? I suggest Ferdinand Mount. While our MPs couldn't be seen for dust, his 2004 book Mind the Gap reintroduced class as a political category. Ahead of its time, it confronted the benign take on globalisation dominant in Westminster. The book was a shout out against the "cold indifference" of contemporary capitalism; the disrespect afforded to those who fall on the wrong side of the new class divide. Its focus was on the economically and culturally dis-invented – "the tribes who live in the dark". A brilliant book, it signalled a new readiness from the right to confront the realities of social rupture, well before the music stopped and Bear Stearns went to Chapter 11 insolvency.

Within the text we can identify the building-blocks for the "Red Tory" Phillip Blond, and the rise of the Cameroons. Mount argued we must "rebuild the little platoons". The faith communities would be critical in delivering welfare; we need to see greater reciprocity and employee share ownership, localism and community control of the state. We should, in later parlance, "recapitalise the poor" through asset transfers - land and housing, school and health vouchers, in order to help the victims in the new "downer" class.

Here the causes of inequality lie at the feet of the welfare state. It crowds out working-class respect, fraternity and civics; community cohesion, duty and obligation. Ceteris paribus, we confront these inequalities once we reduce the power of the state.

The tragic consequence of this viewpoint is played out today in the collapse of the "Big Society". To quote Richard Sennett, "the local community, like the colony, is stripped of wealth, then told to make up for that lack by its own efforts".

Mount stands as a key figure in the political game-change of the past decade. The left embraced a dystopian "winner takes all" version of capitalist modernity in which the human values of commitment and loyalty were subordinated to anonymous market forces. The right returned to the social arena and tacitly broke with the cold economic liberalism of Thatcher; a return to localism, family and solidarity.

The writer has links to David Cameron, above and beyond mapping the "Big Society". Cousin Mary is mother of the PM. The two men share the same route map through Eton and Oxford, and the contacts that propel both into the Conservative Research Department and posts in government. Mount became head of Margaret Thatcher's Policy Unit and, later, a political journalist.

He remains a significant writer of fiction, befitting the nephew of Anthony Powell; he is a baronet and former editor of the TLS. His 2008 autobiography Cold Cream is both understated yet also a relentless exercise in name dropping. It's a brilliant career, but one which hardly constituted a struggle: "my only avenue of survival was personal recommendation". Intriguingly, for such a creature of class and patronage, his recent work turns to the nature of the capitalist beast.

The New Few develops the framework of Mind the Gap, specifically a heat-map of our new economic elites. Surveying the inequalities of modern Britain, Mount admits bewilderment. Trickle-down promised so much more; what happened to the rising tide lifting all boats? He sees the twin problems – both a detached elite and underclass, and a seemingly impenetrable centralisation - as the consequence of modern, rampant oligarchy. This was what Thatcherism lost sight of "in the heat and smoke of that long and powerful battle", and Blair's New Jerusalem left untouched.

The New Few then races through some corrosive examples. The still-shocking £9bn HSBC takeover of sub-prime vultures Household, culminating in £53bn set-aside to sweep up this folly; the "festering morass of bad debts" that was HBOS; vainglorious Fred the Shred, and many more. The central concern is the arbitrary power of the CEO and decline of the active shareholder, interlocked with the rise of the fund manager with their top-slice off every transaction: a "croupier's take". In short, there was systemic collusion between the two dominant groups. "One set of oligarchs- the fund managers - approve the size of salaries, bonuses and pension pots for another set of oligarchs - the CEOs, board members and senior managers".

Why so little appetite to confront these excesses? Mount identifies three basic reasons- or excuses, or illusions - that sustain the system. "The market is always right"; "big is beautiful", and "complexity equals progress": they echo the dominance of neo-liberalism, of a system too big to fail, due to the sheer complexity of financial products with no appreciation of moral hazard. A brief history of oligarchy follows, and the forces that shape it: war, technology, bureaucracy, forms of ideology - the links between money and power.

Part Two offers a coruscating analysis of how political elites have emasculated democratic structures to facilitate oligarchy. Checks and balances have gone - at conferences, or over candidate selection - in favour of the party head office. Declining membership and turnout follow, as does the stripping-away of local government and decline of the parochial: the loss of that "freestanding quality". Regulation from the centre appears all-pervasive. An inverse relationship between the empty Commons and a rise in "sofa government" culminates in a "dodgy dossier" and war.

The final section is entitled "Waking Up" and identifies the "little epiphanies" that might constitute change. An argument has started- not least by Ed Miliband - both on the moral aspect of and practical remedies to the present crisis. The book continues to bounce along, but then it falls off a cliff. The Coalition government becomes "the most interesting political event I have witnessed"; possibly a "new world symphony". The Coalition Agreement transcends individual manifestos. What is on offer is "the distribution of power to the many, the taming of the oligarchs". Really?

Mount's book is a brilliant attempt to import rigour and coherence; indeed, the case is better made than by anyone in the current administration. Yet can he really be suggesting across the City, within our hollowed-out party structures, across Whitehall and Westminster, that the Coalition is embarked on a systematic assault on power elites and oligarchy in defence of the little guy? It doesn't look like that from my advice centre in East London.

The man behind the Big Society has attempted to write the Bible for the Coalition. It demands respect and has to be read. I strongly agree that there is "a sense that society has lost its recognisable moral shape, and with it, its legitimacy". But it is because of this that people will demand more, so much more, than what is currently on offer.

Jon Cruddas is Labour MP for Dagenham & Rainham