A noticeable feature of Murphy's political trajectory after his expulsion from the Communist Party was his growing distance from the working-class movement in which he had earlier played such a prominent role. Thus, as a member of the Socialist League's national leadership, he found himself amidst a predominantly public school and university educated group of people. Amongst the 23 people who served as national council members between 1932 and 1937 there were two Etonians, three Wykehamists, and one old Harrovian. At least nine had been at Oxford or Cambridge, and four at London University. The formal education of only two, one of whom was Murphy, ended at elementary level.Ironically, despite the fact the Labour Party had a primarily working-class membership, Murphy now mixed in a social milieu which was less than ideally suited to the task of enticing the labour movement from its inherent suspicion of left-wing middle-class intellectuals.

In addition, Murphy increasingly began to write for, and closely associate with, a number of liberal reformist journals which were linked to different middle-class groups and individuals. There was Adelphi, which was owned by John Middleton Murry who espoused a form of Christian communism and who grouped around him a number of young writers with a ‘synthesis of aestheticism, post-Impressionism, Nietzsche, D. H. Lawrence and socialism’. As well as writing for the journal, Murphy became particularly friendly with its editor, Sir Richard Rees, whom Murphy's wife Molly described as ‘a typical representative of the English intelligentsia, a pacifist and well-dressed gentleman’. There was also New Britain, a journal connected with a Bosnian Serb intellectual, Dimitrije Mitrionovic, who set up a national organisation known as the New Britain Movement (NBM) that operated between 1933 and 1934. It called for personal alliance (individuals consciously entering into unity with others to achieve a new unity), Monetary Reform, Industrial Guilds (which would run and control industry), the Three Fold State (separate parliamentary ‘houses’ for politics, economics and culture), and the Federation of Western Nations. In addition, there was the House of Industry League, a successor body to the NBM, which formed in 1936. It sought collective ownership of industry in an Economic Chamber, to be known as the ‘House of Industry’, representatively based on national Industrial Guilds.