Politics and business are, contrary to popular conspiracy opinion, actually not the best of friends. That’s incredibly obvious today, after the Brexit Secretary went out of his way to chastise the boss of John Lewis on BBC Radio 4’s Today programme, after the business blamed a fall in profits on Brexit. Whether he’s right or wrong on the specifics is for market analysts to argue. What’s remarkable though is that it shows up a growing split between the “party of business”, and the companies that employ millions up and down the country.
Most of the time, politicians like to say that they want to change the world. A lot of the time, the largest businesses are not the keenest advocates of upending the status quo. Consumers want products that are good quality at a good price – they’re willing to trade their hard-earned cash and create value in the process. They want, as far as possible, to not be ripped off.
Politicians want that too. The incentive in a democracy is obvious: if constituents think their elected official is doing nothing about the hardships they face then they will boot them out.
Sometimes politicians forget, though, that their own actions can lead businesses to charge above the odds. It’s far easier to blame others for your own failings and your own inaction. It’s not unique to politicians of course. We’ve all been there: it was Mick that made you have that extra pint; if Dan hadn’t distracted me I’d have met my deadline.
Politicians just do it more publicly. Easier to blame the land bankers for a housing crisis than realise the only reason builders keep a reserve of permissions is because they can never guarantee the politics of planning in our absurdly restrictive market. Easier to bash the energy companies and slap on a price cap than realise it’s government guaranteed prices for suppliers that are passed to consumers as higher prices.
What’s so depressing about both of these examples is that they come from the Conservative Party, one which has traditionally managed to bridge the gap between the consumer and the business community quite well. It was the party that promoted owning your own business as a practical and moral good.
Tories of the free market tradition went further. For them, the free market allowed businesses that supported churn and change to get ahead, not just the giant established players. It is, as Liz Truss said her speech to the LSE in June, the market that allows those with maverick spirit to “break down monopolies, hierarchies and outdated practices” and create a force that “destroys barriers, and erodes inequality”.
Now look, I’m the first to say that the Conservative Party should be pro-market and not pro-business per se. But there is a difference between telling corporatists that they should get out of the business of putting up barriers to competition and saying “fuck business” altogether.
That particular outburst from the backbench MP for Uxbridge and South Ruislip showed parts of the Conservative Party have come a long way from the days their conference banners read “freedom, opportunity, family, enterprise, ownership”. Tories used to be proud to boast that those overthrowing literal communists in Warsaw and Budapest copied their slogans. Why walk away from that legacy?
Government should set clear, concise, and intelligible rules. Companies can then meet our demands under them. Those that do not, fail.
What I think businesses are trying desperately to say to the government right now though is that they are staring down the possibility of not knowing what the rules are in just under 200 days.
When you’re a company with contracts that extend years into the future, finding out that they’re worth less than the paper that they’re written on is not a profitable outlook. They would be failing their shareholders if they did not point out that a potential culling of profit is not in their interests.
What’s staggering is that all this has let the most left-wing opposition in recent memory claim to be on the side of business continuity. A party whose shadow chancellor has called for a register of property, for property to be requisitioned, for nationalisations, and for prices of appropriated assets to be set by politicians. It is, quite frankly, remarkable that businesses see all of that and think that John McDonnell and the current Labour party still might be a better bet.
Businesses do remember that it is the Tories that reduced corporation taxes – but they also remember it was they who introduced new interfering insurance taxes and sugar levies. They will know who they’re going to blame if all their contracts in Europe go Pete Tong.
Matt Kilcoyne is head of communications at the Adam Smith Institute, the free market neoliberal thinktank.