Why Vince Cable is no Marxist

The Business Secretary’s arguments owe more to Adam Smith than they do to Karl Marx.

The Lib Dem conference has so far produced few memorable speeches, but Vince Cable's widely trailed address should prove an exception. He will warn that the current system "takes no prisoners and kills competition where it can" and that markets are "often irrational and rigged", and he will promise to shine a "harsh light into the murky world of corporate behaviour".

Inevitably, the free-market right has interpreted Cable's speech as an attack not on unfettered markets, but on capitalism tout court. Richard Lambert of the CBI criticised Cable's "odd" and "emotional" language, and Lambert's predecessor Digby Jones accused the Business Secretary of "rabble-rousing".

Yet Cable's arguments owe more to Adam Smith than they do to Karl Marx. His words reflect the centuries-old awareness that the free market is not synonymous with competition, or with the public interest.

As Smith, that great apostle of capitalism, argued:

The interest of the dealers, in any particular branch and trade or manufactures, is always in some respects different from, and even opposite to, that of the public.

Which now looks like a rather prescient comment on the British banking sector. Elsewhere, on the self-interested nature of industry, he pointed out:

Our merchants and master-manufacturers complain much of the bad effects of high wages in raising the price of their goods both at home and abroad. They say nothing concerning the bad effects of high profits. They are silent in regard to the pernicious effects of their own gains. They complain only of those of other people.

What Cable's critics are too intellectually barren to acknowledge is that there are alternatives to the finance-dominated, Anglo-Saxon model beyond that of state socialism. The Swedes do capitalism, the Americans do capitalism, the French do capitalism, even the Chinese do capitalism. But they all do it in very different ways.

When Richard Lambert sneers that it "will be interesting to hear [Cable's] ideas for an alternative", he fails to acknowledge this reality. But at least some of our political class may be about to.

UPDATE: Cable left in his attack on capitalism, but added a reference to Adam Smith that wasn't in the text last night. Perhaps the Business Secretary read The Staggers over breakfast?

His words: "Capitalism takes no prisoners and kills competition where it can, as Adam Smith explained over 200 years ago."

George Eaton is political editor of the New Statesman.

Ukip's Nigel Farage and Paul Nuttall. Photo: Getty
Show Hide image

Is the general election 2017 the end of Ukip?

Ukip led the way to Brexit, but now the party is on less than 10 per cent in the polls. 

Ukip could be finished. Ukip has only ever had two MPs, but it held an outside influence on politics: without it, we’d probably never have had the EU referendum. But Brexit has turned Ukip into a single-issue party without an issue. Ukip’s sole remaining MP, Douglas Carswell, left the party in March 2017, and told Sky News’ Adam Boulton that there was “no point” to the party anymore. 

Not everyone in Ukip has given up, though: Nigel Farage told Peston on Sunday that Ukip “will survive”, and current leader Paul Nuttall will be contesting a seat this year. But Ukip is standing in fewer constituencies than last time thanks to a shortage of both money and people. Who benefits if Ukip is finished? It’s likely to be the Tories. 

Is Ukip finished? 

What are Ukip's poll ratings?

Ukip’s poll ratings peaked in June 2016 at 16 per cent. Since the leave campaign’s success, that has steadily declined so that Ukip is going into the 2017 general election on 4 per cent, according to the latest polls. If the polls can be trusted, that’s a serious collapse.

Can Ukip get anymore MPs?

In the 2015 general election Ukip contested nearly every seat and got 13 per cent of the vote, making it the third biggest party (although is only returned one MP). Now Ukip is reportedly struggling to find candidates and could stand in as few as 100 seats. Ukip leader Paul Nuttall will stand in Boston and Skegness, but both ex-leader Nigel Farage and donor Arron Banks have ruled themselves out of running this time.

How many members does Ukip have?

Ukip’s membership declined from 45,994 at the 2015 general election to 39,000 in 2016. That’s a worrying sign for any political party, which relies on grassroots memberships to put in the campaigning legwork.

What does Ukip's decline mean for Labour and the Conservatives? 

The rise of Ukip took votes from both the Conservatives and Labour, with a nationalist message that appealed to disaffected voters from both right and left. But the decline of Ukip only seems to be helping the Conservatives. Stephen Bush has written about how in Wales voting Ukip seems to have been a gateway drug for traditional Labour voters who are now backing the mainstream right; so the voters Ukip took from the Conservatives are reverting to the Conservatives, and the ones they took from Labour are transferring to the Conservatives too.

Ukip might be finished as an electoral force, but its influence on the rest of British politics will be felt for many years yet. 

0800 7318496