The Mandelson scandal exploded at the worst possible moment for Labour’s leadership. Already losing support among working-class voters, MPs and ministers, Keir Starmer’s government now faces public anger over why he appointed Peter Mandelson as ambassador to Washington despite his known links to Jeffrey Epstein and his record of forced resignations from government.
For all the leadership’s talk of ‘integrity’ and ‘professionalism’, the crisis has exposed the grip of a layer of political fixers whose loyalties lie not with the working class but with capital, the state and their own networks of influence.
Labour Together, the right-wing party faction that organised Starmer’s leadership campaign, won support on pledges designed to reassure Jeremy Corbyn’s base. Through Morgan McSweeney, it shaped the Starmer project until McSweeney’s resignation in February. Mandelson was not an outsider to that world, but one of its central figures.
Court politician
Mandelson’s rise was inseparable from Labour’s transformation in the 1980s and 1990s. As one of New Labour’s chief architects, he helped adapt the party to a Thatcherite world of deindustrialisation, financialisation and defeated, increasingly bureaucratised trade unions.
The abandonment of Clause IV, which had formally pledged Labour to common ownership of the means of production, the embrace of finance capital and the subordination of working-class interests to electoral strategy were conscious decisions. The layer around Tony Blair remade Labour as a party less reliant on organised labour and more acceptable to British capital than the crisis-ridden Tories.
Mandelson’s role was central. A master of media manipulation and internal discipline, he functioned as a political courtier: a fixer who aligned the party with the needs of the ruling class while neutralising opposition inside its ranks. His nickname, the ‘Prince of Darkness’, captured the opaque, unaccountable character of his power.
His scandals are often presented as personal failings. In reality, they reveal something systemic. His first resignation in 1998, over an undeclared loan from Geoffrey Robinson, and his second in 2001, in the Hinduja passport affair, were expressions of a politics embedded in elite networks, where access, favour and influence are the currency of power.
The fact that he returned each time to positions of authority demonstrates the moral and ideological bankruptcy of the Labour right. To them, Mandelson was too useful to discard. His skills in managing the intersection between government, business and the media are indispensable to a party committed to administering capitalism.
His return to government in 2008, at the height of the global financial crisis, underlined his real function. As Business Secretary, he did not represent a break with the casino economy that had crashed. He became a leading defender of the Brown government’s rescue of British capitalism: a rescue that socialised losses while preserving the system.
This was New Labour’s project in its purest form: the use of state power not to transform society, but to defend capital in times of crisis. Mandelson’s advisory roles, consultancy work and connections with oligarchs and corporate elites always blurred the line between public service and private gain.
From Corbyn to Starmer
Keir Starmer’s ascent to the Labour leadership was, from the standpoint of the Labour right, a decisive victory over Corbynism. Jeremy Corbyn mobilised hundreds of thousands who wanted a break with austerity, inequality and war, even if that potential was never realised.
For figures like Mandelson, the priority was to steer Labour back to Blairism. He was central to Labour’s internal opposition to Corbyn, telling the Guardian in 2017: ‘I work every single day in some small way to bring forward the end of his tenure in office.’
That meant reasserting Labour’s role, in Blair’s phrase, as a ‘party of government’: disciplined, pro-business and safe in the eyes of the ruling class. The purge of the left, the marginalisation of Corbyn’s supporters and the rehabilitation of New Labour figures were all part of the same project.
But the restoration came at a cost. Corbynism, whatever its limitations, expressed a deep social crisis and a widespread rejection of austerity, inequality and war. Starmer has neither the intention nor the capacity to address those demands. Instead, he has tried to suppress them.
Labour’s electoral victory was therefore less an endorsement of Starmer’s vision than the product of the fragmentation of the Tory vote, including its haemorrhage to right-wing populism. Labour was handed a parliamentary majority without a corresponding surge in popular enthusiasm.
Starmer’s net favourability now sits at minus 46, according to YouGov. Without a programme capable of addressing the cost of living crisis, ongoing wars or the discontent driving political volatility, the government’s support is extremely fragile.
Labour Together represents the consolidation of a right-wing leadership committed to continuity with Blairism and partnership with business. Its task is not to improve society, but to stabilise capitalism under conditions of mounting crisis.
Yet here lies the contradiction. New Labour’s methods were developed in a period of relative economic stability and political consensus. Today’s conditions are far more volatile. The old formula no longer works.
The Washington job
Mandelson’s appointment as ambassador to Washington was not a normal diplomatic posting but a political appointment, and a clear signal that Starmer intended to follow the New Labour blueprint.
His role was to manage relations with the world’s dominant imperialist power and the second Trump administration: reassuring investors, strengthening strategic ties and limiting the damage from Washington’s protectionism and unpredictability. The logic was clear. Mandelson’s attraction was precisely that he moved in elite networks. The problem was that those networks included Epstein.
Mandelson’s association with Epstein points to the social milieu in which he operated: circles defined by extreme wealth, privilege and a profound lack of accountability. For a party that claims to stand for equality and justice, such connections are politically toxic. They are the by-product of a strategy that integrates Labour into the highest levels of capitalist society.
Labour’s leadership is trying to govern with the tools of a previous era, relying on figures whose methods are increasingly out of step with the mood of society. The result is a party in government but not in control: beset by crises, losing support to Reform, the Greens and the nationalists, and increasingly unable to command legitimacy.
A party that rejects class struggle in favour of electoral management, that seeks the approval of capital rather than its overthrow, will inevitably produce and depend on political operators of the Mandelson type.
Blairism strained the central contradiction of the Labour Party—resting on the working class while delivering the bosses’ agenda—to breaking point. Starmerism continues the same trajectory under less stable conditions and with diminishing returns.
For a class-struggle party
For socialists, the lesson is not to demand a ‘cleaner’ or more ethical Labour Party, nor simply to call, as John McDonnell has, for its democracy to be ‘restored’. The problem is structural. The task is to resolve the contradiction in favour of the working class by breaking Labour’s grip on it.
Labour’s crisis reflects a deeper crisis of representation. The working class is searching for answers in a period of intensifying economic and political instability. Corbynism expressed that search but failed to break with Labour’s pro-capitalist programme. Starmerism responded by trying to close it down altogether.
As Labour loses its ability to absorb and deflect opposition, new political forms will emerge to the left and the right. The task for communists is to intervene in that process and fight for an independent, democratic and revolutionary working-class party that can challenge both Labour’s failures and the danger of reaction.
