For the third time in six years, the Conservative Party is choosing a new British prime minister. The melodrama of Boris Johnson’s premiership proved a distraction from the problems the country faces: a stagnant economy, a degraded public realm, poor productivity and a disunited kingdom.
The Conservative leadership contest is superficially most notable for its admirable ethnic diversity. The parents of Kemi Badenoch, Suella Braverman, Rehman Chishti, Sajid Javid, Rishi Sunak and Nadhim Zahawi came to the UK from Nigeria, Kenya, Mauritius, Pakistan, India and Iraq, and their families have thrived here. As our columnist Tomiwa Owolade writes on page 11, just as the Tories had the first Jewish prime minister and the first female prime minister, so they are likely to have the first black or brown prime minister. For Labour, which prides itself on its progressive self-image but has never had a female or non-white leader, this is cause for reflection.
The Conservative candidates’ ethnic diversity, however, is not matched by their ideological diversity. Rather than advancing a new vision for the country, they are returning to outdated orthodoxies: tax cuts, deregulation, a smaller state and limited government.
The former chancellor Mr Javid and former health secretary Jeremy Hunt, for instance, have proposed cutting corporation tax from 19 per cent to 15 per cent (rather than raising it to 25 per cent, as Mr Sunak planned when he was the pandemic chancellor). But there is no evidence that the £34bn cost of this policy would be justified by higher economic growth.
Between 2011 and 2018, when UK corporation tax was reduced from 28 per cent to 19 per cent, there was only one year when the cost of the tax cut was matched by the increase in business investment. Germany, France and the US (all of which have higher corporate tax rates) have consistently outperformed the UK on this measure. The biggest obstacle facing firms is not excessive taxation but – as no Tory candidate will say – the consequences of Brexit, as well as other long-term economic trends.
Other Conservatives, such as the Foreign Secretary, Liz Truss, and the new Chancellor, Mr Zahawi, have proposed reversing the National Insurance rise or cutting income tax. These measures would, at least, benefit low- and middle-earners, but they do not amount to a vision for reviving living standards, let alone the economy.
The UK’s most urgent problems – dismal economic productivity, enfeebled public services, dilapidated infrastructure, skills shortages – require not tax cuts but investment. For a period, the Conservatives appeared to understand this. In the early phase of her premiership, under the influence of her post-liberal chief ideologue Nick Timothy, Theresa May pushed back against the libertarians, speaking of the “good that government can do” and championing industrial strategy. Pragmatic and non-ideological, Mr Johnson embraced “levelling up” in an attempt to narrow the UK’s regional disparities.
Rhetoric was never matched by reality, but rather than recognising as much, the Tory candidates have dispensed with a communitarian approach altogether. Conservative prime ministers from Harold Macmillan to Ted Heath have promoted a central economic role for the state; in Europe, Gaullists and Christian Democrats have embraced interventionism. But there is no Tory candidate in the present contest who represents this tradition.
Mr Sunak offers little beyond a kind of Silicon Valley tech determinism mixed with fiscal conservatism. The UK should aim to reduce its national debt, which stands at 95.8 per cent of GDP, but the best long-term means of doing so is through improved productivity. The UK needs a plan for growth, not one for austerity. Mr Sunak’s vision – the pain of spending cuts followed by the pleasure of tax cuts – is profoundly limited and arid.
The official task facing Tory candidates is to win over their party’s MPs and then its mostly elderly members. It is perhaps unsurprising that they are more concerned with brandishing their right-wing credentials than addressing Britain’s deeper problems. Yet the winner will not only become Conservative leader but prime minister.
After the misrule of Mr Johnson, the UK is in desperate need of political, economic and moral renewal. At present, there is no reason to believe that the next Conservative leader will provide it.
[ See also: The Tories’ new nightmare, by Andrew Marr ]
This article appears in the 13 Jul 2022 issue of the New Statesman, The Selfish Giant