20 April 2018

Is anyone fooled by John McDonnell’s charm offensive?

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In 2013, John McDonnell said of the financial crisis and the ensuing recession, “I’m honest with people: I’m a Marxist. This is a classic crisis of the economy – a classic capitalist crisis. I’ve been waiting for this for a generation . . . Christ’s sake don’t waste it.”

This week, the same man hosted a Labour Party financial services conference at Bloomberg’s London headquarters and, in today’s Times writes: “we recognise the value of Britain’s financial services and when we go into government there will be a seat at the table in policy-making and deliver for the sector.”

To get from the first statement to the second, one of two theories about the man who wants to run the British economy must be true.

The first is that McDonnell has been on a long ideological journey in the last five years. According to this theory, though he once cited “the fundamental Marxist writers of Marx, Lenin and Trotsky” as the most significant influences on his thinking, that is no longer the case. He now recognises the merits of market-based capitalism in general, and that system’s apotheosis – the financial services industry – in particular.

The second is that his overtures to the City are a con. That John McDonnell still thinks all the flawed, disproven and at times repugnant things he has always thought but that he is trying hard to sound as innocuous as possible to maximise his chances of getting his hands on the controls.

Given that McDonnell has never made any public claims to have changed his mind on any fundamental political or economic question, theory number two is significantly more plausible than theory number one.

Even the Shadow Chancellor’s closest allies come close to admitting it. In a recent profile of McDonnell in the Financial Times, Diane Abbott said he “has done his best to transform himself into a friendly, bank-manager-type figure, which, if you know John McDonnell as well as I do, is . . . interesting.”

To McDonnell’s credit, he and his aides know what inoffensiveness looks like in 2018. His Times piece is so stuffed with political platitudes that it comes close to parody.

He writes: “Tech companies are moving into the sector and China is emerging as a leading player. But these changes are poorly understood by the public and the risk is that without securing public trust they will fail to deliver on their promise.” These words could have been come from more or less anyone in Westminster: an MP of any affiliation, a researcher at pretty much any think tank, a participant in yet another panel discussion on the challenges and opportunities of fintech.

It seems hard to believe that any of this will work. The City surely sees through it, recognising the Shadow Chancellor as the threat to their livelihoods that he so obviously is. The worry, however, is that the same may not be true for the rest of the country.

McDonnell cozying up to bankers may be as preposterous as a fox asking for votes from chickens. But Labour’s broader economic platform, which was summarised by the Shadow Chancellor at Bloomberg yesterday as “a vision of society based upon a prosperous economy, but an economy that’s economically and environmentally sustainable, and where that prosperity is shared by all”, sounds plausible enough.

The job of Labour’s opponents in Parliament and elsewhere is to make clear the threat disguised by these bland soundbites.

Doing so means explaining that Labour sees the economy as nothing more than a pile of money waiting to be spent. That the Shadow Chancellor’s worldview has no room in it for any of the tried and tested ingredients for growth and prosperity. And that, for all their talk of fairness, Labour’s mismanagement of the economy would hit the poorest hardest.

There are moments when these messages look like they are getting across. The most recent example was Shadow Business Secretary Rebecca Long-Bailey’s failure to name a single company that supports Labour’s nationalisation plans when put on the spot by Conservative MP James Heappey in the House of Commons on Wednesday.

But those who recognise the threat posed by John McDonnell have mostly done a bad job of communicating the seriousness of the risk. Two things make this a difficult task. The first is that so many cried wolf about “Red Ed” Miliband when he proposed action on energy bills that is now Conservative government policy. The second is that arguing against John McDonnell and Jeremy Corbyn can often come across as denying the existence of economic and social problems that are undoubtedly there.

If there is anything to learn from McDonnell’s charm offensive it is that the mask will not slip all by itself. McDonnell will remain a “friendly bank-manager-type figure” in the eyes of millions of voters as long as the Conservatives fail to demonstrate, with actions as well as words, the stark difference between the economic visions offered by Britain’s two major parties.

Oliver Wiseman is Editor of CapX.