When Labour began the first day of the election campaign with the launch of its business manifesto and a full-page ad in the FT warning of the dangers to firms of EU withdrawal there was bemusement from some. Why not the more salient issues of the NHS and living standards? (On which the party leads the Tories.) One explanation, as I noted yesterday, was that by framing itself as a friend of business, Labour was hoping to limit the damage from future hostile interventions by bosses.
That inevitable assault has begun even earlier than expected. Today’s Telegraph features a letter signed by more than 100 business leaders supporting the government’s economic approach and warning that a “change in course” (i.e. a Labour administration) would “threaten jobs and deter investment”. In response, George Osborne proclaimed this morning: “An intervention on this scale and with this clarity from Britain’s business leaders is unprecedented in any recent general election.”
The political dividend, however, is likely to be smaller than he hopes. In the post-crash era, voters regard big business with greater scepticism and even hostility. Two-thirds of the public, including half of Conservative supporters want the next government to take a tougher stance and there is overwhelming support for the Labour policies most often described as “anti-business”, such as a 50p income tax rate, a mansion tax, a freeze on energy prices and stricter banking regulation. Nor are the political preferences of company heads as electorally decisive as often implied. As one shadow cabinet minister recently pointed out to me, when Tony Blair won in 1997 he did so without the support of a single FTSE 100 boss (a photo opp with Richard Branson was the best he could manage).
Yet if there is no cause for panic, Labour knows that there is none for indifference either. Today’s contretemps is at best a distraction from the party’s announcement on zero-hours contract and at worst a moment that will reinforce the belief that the party cannot be trusted to manage the economy. Voters may be sceptical of business but most also regard it as an indispensable guarantor of national prosperity; its opinions carry weight. As Douglas Alexander recently told the Guardian in reference to the Scottish referendum: “Don’t discount the capacity of business still to have influence in the business square. It’s naive to think it does not matter at all. Economic credibility remains key. Business attitudes mattered in a way that some people had not fully expected before the campaign. The nationalists went into the campaign with an ill-thought through economic policy and currency policy, and it fell apart under the scrutiny of the electorate and business. Labour learned that lesson in 1992 and many elections prior to that so we will not be making that mistake next year.” And the party cannot argue that business opinion matters on Monday (when it quoted Siemens and SCM Direct on the dangers of EU withdrawal) and then argue that it doesn’t on Wednesday.
But the glee with which many Conservatives have greeted today’s intervention reflects their political myopia. If Labour needs to worry about appearing anti-business, the Tories need to worry about appearing anti-worker. The impression (and sometimes the reality) that the party is merely the political wing of the City of London, incapable of representing all classes, is the biggest obstacle to it winning again. There was a time when David Cameron seemed to recognise this. He became the first Conservative leader in more than a decade to meet the then TUC general secretary Brendan Barber and even appointed a union emissary, the former Labour MEP Richard Balfe, to spearhead secret negotiations. But he soon reverted to Thatcherite type. The smart proposal from Tory campaign group Renewal to offer free party membership to trade union members was ignored; Cameron is happier attacking them as “a threat to the economy”. (One wonders whether an anti-Conservative letter from 100 trade unionists would inspire similar levels of coverage.)
Rather than repeatedly assailing Labour as “anti-business”, the Tories would be wiser to spend their time convincing the public that they are not anti-worker. That so few seem capable or willing of doing so is further evidence of why they are in no state to win a majority.
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