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12 May 2017

The useless rich, the Tories’ futile energy “cap”, and an honourable way out for Corbyn

Peter Wilby's First Thoughts.

By Peter Wilby

This strange general election campaign has become not about who wins but about whether Jeremy Corbyn will stay on as Labour leader after his seemingly inevitable defeat. His supporters point out that Clement Attlee, Hugh Gaitskell, Harold Wilson and Neil Kinnock carried on after losing in 1951, 1959, 1970 and 1987, respectively. All except Gaitskell, who died in 1963, fought the next general election.

Most of those comparisons are flawed. Both Attlee and Wilson had won two general elections before they were defeated and in 1951, though the electoral system delivered a Tory majority of 17, Labour got what is still the highest vote share (48.8 per cent) and the highest number of votes (nearly 14 million) in its history. (Oh, happy days!)

Kinnock, campaigning against an incumbent Tory government during an economic boom, substantially increased Labour’s vote share from its historic low four years earlier. The only legitimate comparison is with Gaitskell, who, after nearly four years as leader, presided over a sharp fall in Labour’s vote. But he, too, faced a pre-election boom and an opponent, Harold Macmillan, who could plausibly tell voters, “You’ve never had it so good” – a campaign slogan unavailable to Theresa May.

Corbyn should announce now that he will step down if Labour does not form the next government. The danger of his present position – “I was elected leader of this party and I will stay leader of this party,” he told BuzzFeed this month – is that many Labour supporters will withhold their votes to ensure that Corbyn has no excuses for hanging on. Making it clear that he will fall on his sword, blaming nobody but himself for defeat, will show that he is the honourable, principled and straightforward man he is supposed to be. A spin doctor should tell him that. Step forward, Seumas Milne.

Power games

In 2013, when Ed Miliband proposed an energy price freeze, the Tories said that he needed lessons in economics. Now, they propose a “cap” on prices that amounts to the same thing. The Tories were right the first time. Energy companies can only compete on price; they cannot compete on the quality of gas and electricity they provide. They make unprofitable offers of low prices to new customers in the hope that inertia or ignorance persuades those customers to stay on when prices rise. Savvy folk take advantage, switching frequently. Many don’t. They are “ripped off”, providing shareholders with dividends and subsidising the savvy switchers. There are no rewards for customer loyalty, though there would be if everybody kept changing supplier.

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All markets work this way when providers cannot entice customers with significant differences in the “product”: banking, insurance and credit cards are other examples. If governments set prices, the market cannot function. The alternative is renationalisation, which I support (and so, according to opinion polls, do two-thirds of the public).

Everyday millionaires

This year’s Sunday Times Rich List assures us that the wealthy are just like the rest of us, only with a few more zeros on their bank statements. They worry about their work-life balance, agonise over how much to give their children and fret about losing their fortunes. “When I hear Britain’s wealthiest people talk,” confides Robert Watts, the list’s compiler, “I feel I could be having a conversation heard in countless ­offices, coffee bars or at school gates across the country.” Fancy that.

And fancy, too, that some multimillionaires make money from “humdrum goods and services”, such as vegetables, eggs, soft toys, pet food, yoghurt and even loo rolls. In other words, it’s possible to get on the Rich List, albeit usually its lower echelons, by making or selling things that people want or need. But, of the 1,000 wealthiest people based in the UK, 164 made their money wholly or mainly from property (against 53 who made it from “construction” and therefore presumably put up buildings as opposed to buying, selling and collecting rent from them), 101 from finance and 45 from hedge funds. Add those whose sources of wealth are listed as inheritance, investment or foreign exchange and you reach about a third of the total who seem not to have done anything socially useful.

That’s without counting the 12 who made their pile solely from the gambling industry.

Can’t stand it

It had not occurred to me that royalty would retire, even in their mid-nineties. True, their work, if it can be called that, involves standing about a lot, but I am sure nobody would mind if they sat down when they launched ships, opened factories and inquired of commoners if they had come far.

I wasn’t alone in my surprise at the news of Prince Philip’s retirement next autumn. The currency markets, hearing that royal staff from around the country had been summoned to a meeting at Buckingham Palace and told only that it didn’t concern anybody’s health, panicked and sold off the pound. Did the traders think that the Queen would announce that the royal family was heading off to Canada because Theresa May was about to nuke Brussels?

Status anxiety

Here in Loughton, Essex, where I live quietly and unfashionably, the local amenity society warns that our road is about to be stripped of its “townscape merit” status. No, I hadn’t heard of it, either. Nor do I know what it means, or why we are being downgraded.

Given that every adjacent road is part of a conservation area – which, as fully paid-up members of the middle classes know, has immense snob value – I suppose ours is a sort of consolation prize. My wife is worried that our curtains may have been found in some way wanting. I think it’s the windows put in by those new people down the road. In these uncertain times, one must hang grimly on to whatever status one has, however modest. I shall fight the loss.

This article appears in the 10 May 2017 issue of the New Statesman, Why the Tories keep winning