by Dan Hitchens
Thursday, 8
December 2022
Debate
07:00

Keir Starmer has sold out to the City

Labour's leader may have cured his party's money problems — but at what cost?
by Dan Hitchens
Credit: Getty

Another week, another corporate shindig for Sir Keir Starmer. Today, somewhere amid Canary Wharf’s gleaming towers, the Labour leader and his shadow cabinet colleagues will be centre stage at “a full-day conference for business leaders”, Private Eye reports. The main sponsors are HSBC and the energy company SSE; also helping out with the costs are a couple of lobbying firms. Well, when you start driving many of Labour’s most passionate activists out of the party, you need all the cash you can get.

That said, Labour’s money troubles may soon be a thing of the past. Starmer’s reconciliation with big business, and in particular with the City of London, is well underway. “Private parties have been thrown for Starmer and deputy leader Angela Rayner in many of London’s prestigious neighbourhoods,” Bloomberg reported recently, while “City solicitor Ian Rosenblatt […] said that Labour was now collecting money hand over fist from business people.”


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Starmer’s public comments — on trans issues, trade unions, Brexit, immigration, nationalisation — tend to be composed of fudge, self-contradiction and ambiguity. But look at who he is courting and the direction of travel is clear. We are witnessing a sort of corporate takeover of the Labour Party.

The party’s conference this year, the Financial Times noted, was overrun with “gaggles of besuited lobbyists”. The New Statesman’s Kevin Maguire, attending a conference event for “City slickers”, suggested that the most significant development of the Starmer era might be the emergence of “Bankers for Labour”. Indeed, Starmer bragged that the conference had raised a record-breaking £1m from firms paying to run stalls. One of them was Deliveroo; gig economy firms, which you might naively assume are the antithesis of Labour’s philosophy, are increasingly entangled with the party, employing ex-staffers and donating event tickets worth thousands of pounds. Elsewhere, corporate lobbyists are being seconded to work in the offices of shadow cabinet members.

The innocent explanation for all this is that a Labour administration will have to govern for everyone, and so it ought to extend a Blair-like welcome to business and entrepreneurship. The City may not be perfect, but it is our economic powerhouse, keeping the pound strong, taxes flowing and a lot of people employed. A serious, grown-up government will invest in skills, industry and housebuilding, rather than picking fights with the country’s most successful firms.

And here is the less innocent explanation: that Starmer is uprooting any possibility of genuine economic reform. When he and his City spokeswoman Tulip Siddiq tell City AM that financial services have an exciting future if they can break away from “prescriptive” regulations, he is signalling that he wants more of the same. More London dominance, even if it syphons off money and energy from the rest of the country. More brain drain, whereby the smartest graduates are hoovered up by City firms. More private equity raids on British businesses, and more hollowing-out of crucial sectors like social care and council services through dubious profit-making schemes. More financialisation of land, even as the housing crisis deepens. More dodgy services for oligarchs, all while Britain’s role as an “everything haven” casts an increasingly sickly light over our national life. More risk-taking, despite what happened in 2008.

The best-case scenario for a Starmer government was outlined here a few months ago by Adrian Pabst: a Blue Labour administration, “economically radical and socially moderate”. But to be socially moderate would require standing up to the woke activists who, experience suggests, tend to get their way. As for economic radicalism, it may have just gone under in the chilly waters of Canary Wharf.

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Walter Marvell
Walter Marvell
1 month ago

Shame on the tawdry grubby businessmen who give credence to the absurb idea that this Labour Party would encourage enterprise and the private sector. It is all putrid hot air. Rachel & Keir are Mr & Mrs Potemkin. Just look at their few risible ‘policies’. She is most proud of encouraging windfall taxes – well thanks for screwing our North Sea gas industry in an emergency with 75% tax. 90% of the manifesto is blank or Green Guff. Then she lashes out at private schools and non doms. Anyone spot a theme here? Even as they woo our business elite Labour cannot mask its pathological class envy and aversion to wealth creation. The author is right to call out the fact that they will- like Blair – probably leave the City cash cow alone. The party of the Blob will of course let the ghastly vast Technocracy carry on ruling us. But he is naive to suggest that their social policies and wokery will be benign. Like the rest of our failed British Establishment Labour are hardcore ideologues who hold fundamentalist deranged views on race gender equality and climate. The pursuit of these ‘higher laws’ has seen and will see more suppression of natural justice, freedom of speech. Their cultural wars will be really nasty. Just look at the SNP to get a flavour of the nightmare ahead if these limp Tory-Socialist do not recover and fight for us against a party with not one business exec within its ranks, just unionists, students, lawyers, politicos, nurses and other representatives of the public sector.

Stuart Sutherland
Stuart Sutherland
1 month ago

Just “Blairism” spelt with an S!

AC Harper
AC Harper
1 month ago

An iron rule of politics perhaps? No matter where you want to go politically you first have to govern in the real world.

Mike F
Mike F
1 month ago

But if they don’t hammer corporates and entrepreneurs, including their “friends” in the City, how will they fund double digit pay rises for all Public Sector workers?

The money won’t come from VAT on independent schools, that will more likely actually cost money as buyers are priced out and move their children to the state sector, or tax on Non-Doms, who will certainly move their Dom elsewhere.

I don’t blame the City for cosying up to Starmer – he is almost certainly going to be the next Prime Minister – but they must know that he is going to hit them hard.