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Stuck in the middle with you

We have recently had a run of posts about the new Conservative Party leader David Cameron. I think it is an understatement of the year to say that we contributors are underwhelmed by the gentleman thus far. The articles triggered off a good deal of commentary, not least from some belligerent self-styled New Labour supporters who openly admitted that Cameron is the most likely heir of the Blairite political tradtion, unlike Chancellor Gordon Brown.

In as much as I understand it aright, Blairism involves a number of elements: competent economic management at the macro level (no repeat of the disasters of yore under Wilson, Callaghan, etc); enthusiasm for blurring the boundaries of business and government; desire to micro-manage personal behaviours (training bad parents to be good parents); an obsession with modernity for its own sake; distrust, and in some cases, open dislike of British history and its tradtions; enthusiasm for transnational progressivism and its institutions such as the European Union and United Nations.

Now like all such things my view simplifies things a bit. But that is pretty much what we have got. We have a fairly reasonable economy – albeit one that has performed sluggishly of late – a fast-rising number of public sector workers; a raft of regulations governing the most minute aspects of personal behaviours, and so forth.

Now to Cameron. I honestly do not know how much of this agenda he supports or whether his recent postures are merely attempts to curry favour with the media and the softer-headed swing voters who vote Liberal Democrat. He may, for all I know, be a devoted Thatcherite looking to pull off the greatest hoax in political history.

My worry is, however, that as politicians fight over the centre ground (an elusive area), a lot of the necessarily radical decisions needed to keep the economy strong, roll back regulations and protect liberty, will not be taken. Quite the opposite. The danger is that we get a sort of Dutch auction in which a Cameronian Tory Party fights to run a corporatist, Big Government model better than its Labour equivalent. And the end-result is the sort of sclerosis we endured in the 60s and 70s.

In any event, I leave this with a fine quote from the Times journalist and economics writer Anatole Kaletsky, who can hardly be characterised as some sort of right-winger, but who is deeply concerned about how our economic vitality could be squashed as politicians fight over some sort of hypothetical “centre ground”.

Suppose first that the Tories are genuine in their sudden enthusiasm for high taxes, rising public spending, anti-elitist education and a totally government-financed health service. Britain then faces European-style paralysis in the years ahead. Not only can we rule out any radical change in the structure or the quality of the public sector, we can also rule out even the possibility of a serious debate on the role or the size of the State.

Just as European voters today are offered no real choice by their parties on issues such as EU integration, economic liberalism and the burden of taxes, the only choice for Britain will be big or bigger government, high or higher taxes and public service bureaucracies managed by Tweedle-Dum or Tweedle-Dee. The three most important growth industries of the 21st-century economy — health, education and pensions — will continue to be monopolised by the public sector. In short, the commanding heights of the economy will be dominated by the Government to an extent that Herbert Morrison could only have dreamt of in 1945.

The long-term results are likely to be the same as they were in the 1950s and 1960s: the British economy will move back into long-term decline, not only because government spending and taxes will rise relentlessly as a share of national income, but even more because what should be the most dynamic industries powering Britain’s future will be run by the State. And whatever the born-again social democrats surrounding Mr Cameron may say about the alleged efficiency of a tax-financed NHS in comparison with the insurance-based models employed in other countries, experience suggests that competition among profit-motivated producers for the custom of price-sensitive consumers always beats the “efficiency” of central planning over time.

10 comments to Stuck in the middle with you

  • GCooper

    Well said, Mr Pearce and good of you to quote Kaletsky – one of the few reasons to read the Nu-Labour house magazine that the Times has become under Murdoch.

  • GCooper, as a Times reader I’m curious what paper it is that you prefer? If you care to recommend one I undertake purchase it on Saturday and read it, open minded.

  • GCooper

    Simon Gibbs writesL

    “GCooper, as a Times reader I’m curious what paper it is that you prefer? If you care to recommend one I undertake purchase it on Saturday and read it, open minded.”

    That’s a very reasonable proposition and I wish I could give you a fittingly reasonable response. Sadly, the newspaper I once would have recommended, the Telegraph, is currently sliding like a greased pig on roller skates down the side of a glass mountain (c. Robert Sheckley, I seem to recall).

    This week it has been running quite possibly its most bizarre series yet – some sort of pseudo-scientific, New Age babble about detoxing. I glanced at one episode and saw it had got to ‘detoxing your soul’.

    No dumbing down, there, then.

    All this, moreover, would be doubly true if you had the misfortune to stumble across a pile of unsold Sunday Telegraphs, the recently appointed editor of which seems unable to decide whether she is editing a serious Right of centre newspaper or a women’s magazine.

    In fact, I’ve been making the journey the other way on Sundays.

    So much for the ‘Right wing domination of printed newspapers’!

  • guy herbert

    … keep the economy strong, roll back regulations and protect liberty…

    Protecting liberty is what we need. The other things are a means and a happy side effect. We should not do things “because they are good for the economy”. Rather a poor freeman dependent on his wits and his neighbours, than a rich slave whose life hangs by his master’s whim.

  • Verity

    I don’t know who Robert Sheckley is, but he has quite a turn of phrase.

    The Sunday Telegraph has turned into a woman’s lifestyle and cooking magazine and the opinion pages have been chopped off. There used to be six or seven really interesting political commentaries by professional observers, but who wants to read silly old political opinions when real people just want to find out where to detox (as your body can’t do it for itself), where to go for the best Mayan rebirthing experiences, the most sensational Italian olive oil – or is it Spanish! Read our olive oil experts’ revealing comparisons! Fun facelifts! Tips on finding a beautiful old house to convert into a barn!

    Unless Sarah Sands sadly agrees to trudge round the back of the shed in this season’s most exciting faux leather boots with a bottle of whiskey (is Scotch whiskey still the best? Or are the Japanese now roaming in the gloaming as the Loch Ness Monsters of the whisky lake?) and an illegally held firearm, the Torygraph is over. Like the Tories, come to think of it.

  • Johnathan

    I am afraid the Telegraph has lost its way. I am not too bothered by lots of guff about de-tox. This is January, people are still mourning George Best (RIP) and worrying about their own livers. Roll on February.

  • pommygranate


    You are far too generous in your assessment of Labour’ economic management.

    They inherited a wonderful position. Defeated unions, a devalued and free-floating currency, a fiscal surplus, no major pension problems, a strong economy, a recently revived housing market, and a government take of the nations’ wealth at well under 40%.

    Their first two economic decisions, ensuring the Bank of England’s independence and keeping a lid on spending were well received.

    However, since then Labour has not introduced a single measure that has increased the prosperity of this country. Quite the opposite, they have raided the piggy bank in a quite egregious manner.

  • HJHJ

    The second of the papargraphs you quote from Anatole Kaletsky is particularly interesting and tight on the ball. We keep hearing that NuLabour accepts and even supports the capitalist/enterprise economy and has moved away from ‘picking winners’ and trying to run industries itself. I have long thought that this is rubbish – not only is it running ever expanding (but decreasingly efficient) parts of our economy but it also controls the prospects of much of the private sector due to the ever-increasing spend of the public sector on commissioning goods and services from the private sector. This spending is not driven by market forces and therefore the efficient allocaton of resources (one of the prime drivers of a cpaitalist economy) is being lost.

    Meanwhile the ‘true’ private sector (i.e. that which doesn’t have the public sector as a customer) is squeezed by higher taxes to pay for the govt spending and the higher interest rates and uncompetitive exchange rate caused by the need to control largely public sector-generated inflation. The ballooning trade deficit is damning evidence of this (I know that many people point to the larger US trade deficit, but the fact is that NuLabour started with a trade surplus and the deficit has deteriorated much faster here. The US economy has also grown much faster than ours – a fast-growing economy with a trade deficit is one thing, a slow growing economy with a trade deficit is quite another).

    On the Cameron front, we can only hope that he is playing a long game. Whilst committing to the government-guaranteed supply of public services, he may be planning radical changes to the current government-run supply side. If the supply side can be liberalised (e.g. a myriad of independent, competing suppliers to an NHS that is purely a commissioning body) then this will set us up well for an eventual reform of the funding and commissioning of such services and perhaps the abolition of the NHS and state education system. While we don’t have multiple competing suppliers already in place it would be difficult to effectively introduce a well functioning market system quickly and effectively anyway, as we saw in the case of the railways. I hope this is what he plans.

  • Derek Buxton

    We thought Howard was the answer but look how badly he let us down, now Cameron has already reversed several things he promised so do not hold your breath. I have tried to find out from his office just what he means by social justice but no reply. He is against grammar schools which were without doubt the greatest contribution to social mobility and education at least until Butler put a time bomb under them. Great Britain…R I P

  • Paul Marks

    I think Johnathan would agree that Labour (after the first couple of years) has meant an explosion of government spending and much greater (and more complex) taxation.

    Regualtions (thanks to the E.U.) have also vastly increased.

    I think we can rest assured that Mr Cameron will carry on the above tradition.

    Peter Oborne (or however I should spell his name) says in the Spectator that Mr Cameron is the heir of the great Conservative party Prime Minister Dizzy.

    I agree – but then I think Ben Dizzy did more harm to Britain than any other 19th century Prime Minster.

    The 1875 Act compelling local government to take on about 40 new functions (which had been optional before). The other 1875 Act which tried to put trade unions above the law of contract. The council house Acts, and slum clearence Acts (little used at the time, putting setting bad precidents.

    And, of course, the increase in taxation. Certainly it was small – income tax was less than 2% in 1874 and due for abolition (Dizzy promised to get rid of it). But then he started the trend of the increase in government spending and the chance to fulfill Gladstone’s dream and abolish income tax was lost.

    Then there is the petty corruption (such as the choice to keep imposing Turkish taxation on a certain island in the Med after we took it over in 1878, the money going to certain financial interests in London – this island was given a grudge against us and British troops were dying there as late as the 1950’s).

    Or the general imperialism – or as Mr Cameron’s friends in the Henry Jackson society would say “the speading of our values”.

    Peter O. can have Dizzy and Cameron – I want no part of either of them.

    Still that is all history. And (as Johnathan knows) we live in a Blair-Cameron history free zone now.