Over the Christmas week, CapX is republishing its favourite pieces from the past year. This was first published on September 27.
Jeremy Corbyn opened his speech to the Labour Party conference – after the chants of “Oh, Jeremy Corbyn!” had finally, finally died down – with a genuinely moving story.
He told the audience about Margaret Bondfield, a 19th-century teenage shop assistant from Brighton who was so shocked by the working conditions she saw around her that she risked her job to become a trade unionist. She rose through the movement to become assistant general secretary while still in her twenties, seconded the motion that created what would become the Labour Party – and ended up as Britain’s first female privy counsellor and Cabinet minister.
What Corbyn left out, as Mark Wallace points out, was what happened next. In 1931, the British economy had been plunged into crisis by the Wall Street Crash and Great Depression. The independent May review (no relation to Theresa, as far as I’m aware) recommended harsh cuts in unemployment benefits in order to balance the books. As labour minister Bondfield was, to the horror of Labour backbenchers, prepared to agree – but Cabinet as a whole could not.
Corbyn kicks off with praise for Margaret Bondfield – oddly doesn't mention as Minister of Labour she backed cutting welfare in a recession.
— Mark Wallace (@wallaceme) September 27, 2017
Ramsay MacDonald formed an emergency National Government to push the cuts through; the Labour Party was decimated at the subsequent election; and Bondfield lost her seat, castigated as a traitor by her own side. (The reason that the Ministry of Labour became the Department for Employment in 1968 was that Barbara Castle did not want to be associated with Bondfield, even via her job title.)
Bondfield, in other words, is an emblem of Labour’s long history as the kind of crusading party that Corbyn believes in – and has, remarkably, persuaded so many others to believe in. Yet she is also a totem of the party’s equally long tradition of prudence and financial responsibility – and, indeed, of its activists’ long history of resentment towards those who prioritise the latter over the former.
And this dichotomy reflects where Corbyn and his party are today. In the opening sections of his speech, as he landed punch after punch on the Conservative government – mocking May’s “strong and stable” slogan, the “coalition of chaos” around her Cabinet table, the state of the Brexit negotiations, the “magic money tree” found during the DUP negotiations, the Government’s series of U-turns – Corbyn looked unbeatable.
Yet during the interminable second half of the speech – what Gaby Hinsliff of the Guardian cruelly but accurately labelled “the Light Ramble Through Areas Of General Interest To Me phase which all Corbyn’s speeches reach eventually” – he looked unelectable.
As with John McDonnell on Monday, Corbyn’s speech contained all manner of contradictions. There were promises of a surge in housebuilding, but also to impose rent controls – something almost every economist thinks is an absolutely terrible idea (see for example this by Paul Krugman) – and give tenants and leaseholders a veto over local redevelopment efforts.
There was powerful condemnation of abuse “of anybody by anybody”. This from a leader who has tried to ignore the rampant anti-Semitism within his party; whose team told Labour Friends of Israel he was too tired to attend their party, even though he went to three others that night; and whose winged monkeys were simultaneously whipping up a hate campaign against Laura Kuenssberg of the BBC based on fake news.
Yet the most important thing about Corbyn’s speech was, in fact, its consistency. It consistently set out a vision in which both economy and society must be shaped and guided – planned and managed – by the state.
Labour had, he said, “developed a new model of economic management to replace the failed dogmas of neo-liberalism”. This would “transform our economy with a new and dynamic role for the public sector, particularly where the private sector has so evidently failed”. He then went on to talk about the water companies – which even the staunchest Conservative wouldn’t defend. But the implication was that the private sector as a whole has failed – the same private sector which has created 3.5 million jobs since 2010.
This is Corbyn’s “new common sense about the direction our country should take”. To “rebuild and invest in our economy, with a publicly-owned engine of sustainable growth, driven by national and regional investment banks, to generate good jobs and prosperity in every region and nation.”
For government to take “a more active role in restructuring our economy”. “To take back our utilities into public ownership to put them at the service of our people and our economy and stop the public being ripped off.” To “mobilise public investment to create wealth and good jobs” via a “National Investment Bank” and “Transformation Fund”.
The Tory approach to the economy, said Corbyn, is “extractive” rather than “entrepreneurial”: “It’s all about driving down wages, services and standards… [making] as much money as quickly as possible, with government not as the servant of the people but of global corporations”. Grenfell Tower, he argued, is the “tragic monument” of this “degraded regime”. (Apparently abuse of anybody by anybody is bad, but using the dead to score political points is just fine.)
At times, this commitment to state direction became downright laughable. Automation, said Corbyn, was “a threat in the hands of the greedy, but it’s a huge opportunity if it’s managed in the interests of society as a whole. We won’t reap the full rewards of these great technological advances if they’re monopolised to pile up profits for a few.”
The solution? Technological advances should be “publicly managed – to share the benefits – [and] be the gateway for a new settlement between work and leisure”.
But it is not just the robots that must be supervised by the state. “The huge shift of employment that will take place under the impact of automation must be planned and managed. It demands the reskilling of millions of people. Only Labour will deliver that.”
All this may be attractive to Corbyn’s young supporters. But if you are a businessman – if you dream of starting your own firm, or even if you just work in one – what are you being offered?
It was telling that despite deriding the Tories’ claim to speak for the entrepreneurs, Corbyn did not actually use the word himself. In his world, to get things done, you don’t start a company – you empower the state.
In fact, if you go through the entirety of the speech – all 5,965 words of it – you will find precious few references to business, almost all of them slighting. On immigration, he growled that “it isn’t migrants who drive down wages and conditions but the worst bosses” (in collusion with a Conservative government, of course). The entire Labour programme can be funded, he wrongly insisted, by “asking the richest and the largest corporations to start paying their fair share”. Corporate boardrooms, he said, “must be held accountable for their actions”.
Elsewhere, he said that he has met business groups – one of just three times the word “business” appears in the speech – but largely to tell them that “we are going to ask big business to pay a bit more tax” (that’s the second time). Oh, and that business must be “accountable to the public” (the third).
As for the “natural monopolies” that Labour is going to expropriate – at a price dictated by Parliament – they will be placed in “democratically accountable public ownership… with new participatory forms of management”. Which sounds positively Chavista.
None of this should be surprising. Corbyn is, as I’ve written before, a man who believes that the free market is not an engine of prosperity, but a fraud perpetrated on the world.
“Free market capitalism,” he has written, “cannot provide for everyone, or sustain the natural world. Its very imperative is of ever hastening exploitation of all resources including people, and it needs armies and weapons to secure those supplies.”
Faced with the shiny-faced Corbynite hordes, it can be tempting to despair. But even as he proclaims himself ready for government, the joy of Corbyn is that his position is so hostile to enterprise and entrepreneurialism, so focused on rebuilding the socialist state of his 1970s imagination, that he offers all manner of ammunition to his enemies.
Unlike Margaret Bondfield, he has yet to learn – will never learn – to compromise with reality. And that, for those of us who oppose him, is why there is still hope.