With two Tory MPs defecting to Ukip, David Cameron is worried. Ukip may get as much as 20% of the UK general election vote next year, though that won’t equal 20% of parliamentary seats. Its views are an extraordinary muddle of working-class populism and neoliberal economics.

A spectre is haunting Britain’s political elite: Ukip. In the European election in May, this insurgent party of rightwing populism humiliatingly defeated all the main parties — not just the governing Conservatives and Liberal Democrats, but the opposition Labour Party, too. No party other than Labour or Conservatives has topped a national election in a century. Ukip’s leader Nigel Farage, who has cultivated a beer-swilling, plain-speaking, man-of-the-people image, had promised a “political earthquake”. And he delivered, winning 27.5% of the votes (1).

Ukip is a complex political phenomenon, and difficult to bracket with France’s National Front or other European parties with a far-right pedigree. Originally founded as the United Kingdom Independence Party in 1993 by a centre-left academic named Alan Sked, it was a single-issue party advocating Britain’s exit from the European Union. Traditional opposition to the European project was never confined to Britain’s radical right. Edward Heath’s Conservative government brought the country into the European Economic Community (EEC) in 1973. Margaret Thatcher — then a cabinet minister — campaigned for Britain’s accession. The left of the Labour Party vociferously opposed the move, believing the EEC was a cold war institution, enshrining capitalist ideas in law and preventing socialist aspirations like nationalisation and industrial activism. After Labour won the 1974 election, it was forced to offer a referendum in which senior Labour figures — including the iconic leftwing leader Tony Benn — agitated for withdrawal. Although the public decisively backed membership, leftwing opponents of the EEC later became dominant within the party and, in its 1983 election manifesto, Labour proposed Britain’s exit.

Thatcher won the election. The experience of Thatcherism changed much, and explains the motivations of Ukip’s current leaders. In 1980s Britain, workers’ rights were rolled back, rapid deindustrialisation devastated working-class communities, and the welfare state was systematically eroded. For many on the left, and the trade union movement, it seemed as though the only hope of progressive legislation came from Brussels. However, the cheerleaders of Thatcherism came to see the European project as a threat to their ambitions. When the European Commission proposed a community charter in the 1980s, guaranteeing protections for trade unions, gender equality and standards for health and safety, Thatcher attacked it as a “socialist charter”. “We have not successfully rolled back the frontiers of the state,” she declared in 1988, “only to see them re-imposed at a European level with a European super-state exercising a new dominance from Brussels.”

A new fault line emerged in Britain’s right: between those supporting EU membership, and the Eurosceptics who wanted far-reaching renegotiation, or even outright exit. When John Major was prime minister, from 1990 to 1997, he faced an assertive revolt within his own party from opponents of the Maastricht Treaty and European institutions. He was engulfed by acrimony, contributing to the Conservatives’ landslide defeat by the now staunchly pro-EU Labour Party under Tony Blair in 1997.

Here is a peculiar thing. The Conservatives’ obsession with the EU crippled their prospects, making them seem out of touch with the concerns of most Britons. When David Cameron assumed the leadership of the party in 2005, he pledged a process of modernisation, abandoning the fixation with issues like the EU in favour of a kinder, more compassionate conservatism. In the years up to the 2010 general election, Cameron’s Conservatives thrived in the opinion polls, unlike his EU-fixated predecessors.

The ‘people’s army’

How has Ukip — with the EU as its key issue — managed to become the third force in British politics, causing extreme discomfort for the others? According to opinion polls, the EU remains a low priority for the average Briton. More surprisingly, research suggests that even 75% of Ukip voters do not include the EU among their top three political issues.

Ukip has created the image of a staunchly anti-establishment party, describing itself as the “people’s army”. Yet Nigel Farage attended Dulwich College, a prestigious private school, and worked in the City as a commodities broker. It is tempting to describe Ukip as British poujadism, but it lacks the petty-bourgeois base of the 1950s French movement. As all the YouGov studies show, Ukip’s voter base is the most working-class of the main parties.

There is a startling political disconnect between the party leadership and its voters. The party describes itself as “libertarian” and its policies are staunchly neoliberal. In the past, Ukip flirted with the idea of a flat tax, an equal income tax that would put supermarket workers and billionaires into the same bracket. Although it has since retreated from that, it still advocates slashing the top rate of tax. It has called for 2m public sector jobs to be cut; suggested cutting employers’ National Insurance contributions, effectively handing bosses a £50bn tax cut; and its deputy leader, Paul Nuttall, has supported privatising the state-run National Health Service.

Ukip’s base has very different leanings. Nearly 80% of Ukip voters support the renationalisation of the energy industry, currently dominated by six deeply unpopular companies making record profits while charging struggling customers ever more. Some 75% want to take the fragmented and expensive railway industry back into public ownership; 66% are committed to a substantial increase in the minimum wage. The majority want to ban zero-hour contracts (which guarantee workers no hours and strip them of basic rights); and half support imposing state controls on private rents. If Ukip’s leaders are hardcore economic neoliberals, its base has strongly left-of-centre economic views (2).

Behind the success

Ukip prospered because of the anti-immigration backlash, widespread alienation with the political elite, and the failure of the left to provide a coherent alternative that resonates with the broader population.

The anti-immigration backlash has been gathering pace for years. In the 2009 European election, out of 15m votes, nearly one million were for the neo-fascist BNP (British National Party). But Farage keeps a careful distance from the BNP, banning its members from joining, and has done the same with Marine Le Pen’s National Front, which he has refused to do deals with in the European Parliament. Hostility goes far beyond the hard right fringes, though. According to surveys, 75% of Britons want to reduce immigration (3). It is routinely chosen by those polled as one of the main issues before the 2015 general election.

The backlash is particularly intense because of worsening economic and social insecurities. The fall in British living standards long predates the collapse of Lehman Brothers: from 2004, the real wages of the bottom half began to stagnate, and for those in the bottom third, they began to fall even as companies posted record profits, because of the weakness of the trade unions, race-to-the-bottom globalisation and a poor minimum wage (4). At the same time, middle-income secure jobs were stripped, leaving an hourglass economy, with professional jobs at the top, and an expanding service sector with low pay and job insecurity. There is also a worsening housing crisis, as successive governments failed to replace council housing sold off from the 1980s, leaving millions on social housing waiting lists.

With these social and economic grievances left to fester — and no strong left to articulate them — anti-immigration sentiment filled the vacuum. The tabloid media and mainstream politicians made immigrants a convenient scapegoat for falling wages, the lack of secure jobs and the housing crisis. Areas with higher rates of youth unemployment actually had lower rates of immigration, yet in towns and cities such as Hartlepool, Middlesborough, Knowsley, Blackpool and Hull (5), where there are only small non-white or immigrant populations, foreigners were blamed for many ills.

Often, communities with the lowest numbers of immigrants are gripped by this backlash. In this year’s European election (6), Ukip did poorly in London and Liverpool — communities that share the same problems, but are far more mixed: interaction with immigrants and Britons from different ethnic backgrounds helped defuse hostility.

‘Take back control of our country’

The EU issue and immigration have become fused. Ukip makes the case that, because of the EU’s open borders, cheap labour is flooding Britain, particularly from eastern Europe. A Ukip campaign poster read: “26 million people in Europe are looking for work. And whose jobs are they after?” A giant hand points out, asking people to “Take back control of our country”. Farage has suggested that Londoners were concerned about Romanian families moving in next door.

According to conventional wisdom, Ukip should be a hopeless cause, since Britain has a first-past-the-post electoral system that places formidable obstacles in the way of small parties hoping to break into the political mainstream. For Ukip, support is disparately spread across the country rather than concentrated in any single constituency. Ukip could win 20% of the votes in a general election and still only win a couple of parliamentary seats.

But as the election approaches, the Conservatives are panicking. Their fear is that Ukip will drain their support, delivering power to Labour and its leader, Ed Miliband. About 20% of voters (7) who opted for the Tories in 2010 have now defected to Ukip. And Ukip has attracted the support of more than 10% of Labour voters, too. The political elite is thought of as out of touch, professionalised, and selfish, especially after the 2009 scandal about MPs’ wide abuse of parliamentary expenses.

There have been many attempts to raid Ukip’s territory. In January 2013 David Cameron promised to hold a referendum on Britain’s EU membership if the Tories won the 2015 election. The government sent messages to ethnically mixed communities urging illegal immigrants to “go home” (usually a racist phrase). Labour and Conservatives have competed over anti-immigration measures, including curtailing benefits for newcomers.

This has played into Ukip’s hands, helping to keep the political debate on terms it is comfortable with. It was widely predicted that Ukip support would subside after the European election, but polls now put it between 12% and 20%. The Conservative backbench MP Douglas Carswell stunned his colleagues by defecting to Ukip in August, triggering a by-election he is all but guaranteed to win. And on 27 September a second Tory MP, Mark Reckless, announced his own defection to Ukip.

In Scotland, Ukip’s appeal has been more limited: frustration at social and economic insecurities fuelled support for the independence movement, which won 44.7% of the votes in the 18 September referendum (see So is that it?).

Ukip is also an indictment of the left. In England, Ed Miliband’s Labour leadership has failed to offer a coherent alternative to Conservative austerity or to inspire the working-class that forms its traditional base. No other leftwing party has managed to achieve any sizeable breakthrough or provide progressive leadership for the disaffected. With British workers enduring the longest fall in living standards since the 1870s, the social and economic insecurities behind Ukip won’t go away. With no alternative, Ukip thrives, despites advocating policies that will shovel more wealth into the bank accounts of Britain’s booming rich.