Don’t be fooled by the Tories’ Big Government rhetoric
Ben Houchen shows the Conservatives are still wedded to free markets
Just prior to viewing UnHerd’s interview with the freshly re-elected Conservative mayor of Tees Valley, Ben Houchen, I had (fun-loving guy that I am) been watching an old Channel 4 documentary filmed during the 1982 party conference season.
A contribution from a speaker at the Tory gathering was, looking back from this distance at least, quite astonishing. He called for the abolition of job centres, arguing that it was the duty of the jobless themselves — over three million of them at that point — to find work, with no assistance from the state. Perhaps he was riffing off the then employment secretary, Norman Tebbit’s, infamous comment the previous year about how his unemployed father had “got on his bike and looked for work”.
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The contrast with the language coming from today’s Conservative Party couldn’t be more stark. No present-day Tory, whatever their private view, would dare stand up at the party’s annual conference and display such contempt towards the unemployed.
The messaging is now all about ‘jobs’, ‘levelling-up’ and using the power of the state to improve people’s lives. It goes a long way to explaining why the Conservatives have knocked so many chunks out of Labour’s red wall. They have understood that there exists in such places sizeable numbers of voters who are entirely approving of a healthy dose of economic interventionism. Coupled with the disdain felt by these voters for the identity politics and wokery that have captured the modern Left, the Tories have been handed an open goal.
Ben Houchen stormed home with 73% of the vote. In his UnHerd interview, he unsurprisingly waxed lyrical about the Tories’ new approach and how it is paying dividends electorally and economically in the north-east.
As always in politics, however, the reality may end up not matching the rhetoric. For all his talk of using the power of his office to intervene in the task of job-creation and his support for such concepts as public-private partnership, Houchen displayed some of the contradictions that still lurk beneath the surface in the Tory party. While he took the local airport into public ownership to save it from closure, he plainly cannot wait to flog it off again.
Neither could he hide his admiration for freeports — “the most free market policy this government has come up with … I think the whole of the UK should be a freeport” — or, for that matter, Milton Friedman, the inspiration for so much of the “rolling back the frontiers of the state” economic agenda pursued by Margaret Thatcher.
In truth, the Tories’ pinstriped, free trade fundamentalist wing never went away, and many among them will be distinctly uncomfortable with the party’s turn — ostensibly, at least — towards big government interventionism.
Where Houchen incontestably gets it right is on the question of the cultural divide that now exists between a “very insular, inward-looking, navel-gazing” Labour Party and its one-time core vote in areas like his. “There’s absolutely a huge disconnect with the Labour Party to areas like Teesside … They don’t understand why local people feel English or patriotic about the armed forces.” True enough. Though as Houchen himself accepts, these voters merely “lent” their votes to the Tories and “will very easily not vote for us again” if his party doesn’t fulfil its promises.
Whether or not the red wall turns blue for more than a few fleeting years will depend on whether Houchen and his colleagues are seen to have repaid the trust these voters placed in them.
A free market allows suppliers to compete to win business from all of us. We pick the suppliers who do it best. That’s democracy; every. single. day. That’s why the Left hate it. They want to choose for us what our allowance for the day will be, and for us to kiss their back sides in gratitude.
But it doesn’t allow workers to pick which business to work for in aggregate, because there is no public employer of last resort.
People have to get hired to eat. Businesses only need to hire if there is a profit to be had. Which is why we have a systemic shortage of jobs – 3,500,000 without work that want it, and only 500,000 vacancies. That’s a five out of six lack of jobs.
It is this power asymmetry that explains why the ‘free market’ doesn’t really exist. ‘No deal’ isn’t an option. Correct that and businesses will have to compete – for both customers and labour, which then drives forward productivity and automation. Learning to do more with less.
No more bailout for failing businesses because ‘what about the jobs’.
No more cheap labour and suppression of the labour share of output.
We can turn competition up to 11. Those businesses that increase their capital depth and productivity will survive. Those that don’t will die.
If you want a free market, everybody has to be able to walk away from it and come back when there is a better offer on the table.
So let’s create one and transition the furlough scheme to true full employment. Let’s see what a truly free market can achieve. One permanently free of the threat of unemployment.
Well your dream seems to have come true in the US, where millions are refusing to take available jobs because the govt is paying them so much in Covid relief etc.
In March, the US government sent a one-time $1400 stimulus check to 90 million Americans, most of whom have few to no savings while it is notoriously hard to receive unemployment benefits. Hardly a welfare culture.
You’ve been watching too much FOX Murdoch media lies.
I am a huge proponent of universal basic income. A €1000 monthly unconditional allowance would change the lives of most working-class and middle-class people.
Coupled with a very strict migration policy, this would reverse the power relationship between workers and their corporate lords.
Where will the £600bn come from each year?
People who work of course…
Thats about £700 per month. JSA is £75 plus rent/mortgage plus council tax so probably a single unemployed person already gets that amount. The unemployed who lose out are couples who get about £100 per week plus other benefits -so they would do better.
well this aged well
Which is why we have a systemic shortage of jobs – 3,500,000 without work that want it, and only 500,000 vacancies. That’s a five out of six lack of jobs.
That sounds good on paper but in practice, a free market economy inexorably reverts to some form of feudalism. Thanks to the magic of mergers and acquisitions, every market ends up being dominated by a few mega-corporations which in turn use their dominant position to jack up prices and fleece consumers.
Thanks to their strong lobbying powers, corporate elites are able to capture the State, and public institutions are subverted to serve private profit.
In the name of free markets, corporate elites demand privatization when the economy is doing well, so they can acquire assets, but in hard times, predators cast themselves as too big to fail and use their political power to get protection from the state, even getting the government into debt to ensure their survival.
In other words, socialism for the rich and capitalism for the poor
The Free Market mantra has one major flaw, it does not account for our very twisted human nature. Thomas Hobbes considered humans to be naturally vainglorious and so seek to dominate others, hence the need for a strong government able to keep everyone — and especially the powerful — in check.
This is the plague of our age. All across Western Europe, many voters like myself — who are economically progressive but socially conservative — find themselves stuck in political limbo.
I feel exactly the same, Noah.
It’s sort of inevitable that even if political culture changes over time, it won’ t do it all at once, isn’t it?
But there is nothing inherent in conservatism, historically, that says it’s not interested in big projects, or spending, or interventions in the economy. The Conservative Party, and certainly conservatism, did not just begin to exist in 1975.
I think there is a sense of some of that last forty years of fiscal thinking that is no longer taken so much for granted among conservatives throughout the west. Certainly looking at things like protectionism or building up of national capacities and industries is not entirely compatible with the globalist free-marketism of many recent conservatives. Concerns about movement of labour which at the moment are being most heard by conservatives are opposed to the principles of globalist capitalism (though not traditional conservatism going back for a much longer period of time, or leftism for that matter.) I even read an article recently about a program for housing the homeless, in a very conservative North American city, where the mayor said it just made fiscal sense to do this as it ultimately cost the state more to deal with a large homeless population.
I have watched the interview and have to say was very impressed with Houchen. He was very up front about the airport saying if it failed it wouldn’t be saved but added that he’d told the people of Tees Valley that this was the case. With regards to freeports, managing to get a large company such as GE to build a manufacturing site on the freeport was also impressive. What ever his free market sensibilities, Houchen seems to be doing his best to give the people of Tees Valley a better future.
Free Trade Fundamentalism? Really? Free trade has brought more prosperity, more freedom, increased health, education and a better quality of life to billions around the world.
People generally do not want the government telling them how to live their lives, they want to be left alone. Yes, a government should create the conditions for trade to flourish and then generally leave it alone with simple and effective regulation. That is what the Conservatives usually represent. the last year has been different for obvious reasons.
The reasons the Conservatives continue to survive and flourish is that they can change to changing circumstances but the core philosophy remains.
An interesting viewpoint and one more reason I’d like to see Unherd post a few extended essays on how to achieve greater economic equality post-pandemic without bankrupting future generations by printing massive amounts of money. Economics seems to be a topic Unherd avoids except in 500-word ‘idea’ pieces.
Could Ben explain why Labour won the nearby North Tyneside mayoralty election?
Except that Thatcher increased the size of government. True she privatised some stuff but she definitely created bigger government that actually implements policy. The tories like big government probably as much as labour.
Google ‘Teesside regeneration’
No one is being fooled.
Currently the economic consensus is on productivity gains, growth towards net zero and reducing spatial inequalities with the Left favouring State Welfarism in balance with Corporate Welfarism alongside global Wokeism and the Right favouring Corporate Welfarism in balance with State Welfarism alongside national ecological rationality.
Something like that anyway.
However, this consensus needs to be contextualised within reducing surplus carbon energy which is simultaneously in a direct relationship with prosperity and an inverse relationship with carbon emissions within the context of human population growth.
It sounds complicated because it is. We are entering an unprecedented period in the history of the human species and grandstanding cultural dogma which discriminates on the basis of race, ethnicity, colour, sex and gender or a nondescript Socialist State that does not take into consideration surplus energy economics is not exactly the best way to prepare ourselves culturally or economically for a crisis ridden future.
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