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5 June 2019updated 08 Jun 2021 8:30am

Conservatives must reaffirm the power of state intervention

By David Skelton

At his political peak, Harold Macmillan gave a speech to the 1958 Conservative Party Conference asserting that his form of conservatism had won the day and that laissez-faire economics had been dispatched to the ideological wilderness. The then prime minister suggested that his political opponents were living “either in the past or in a world of make-believe. The pure doctrine of laissez-faire and absolute free trade; the nationalisation of all the means of production, distribution and exchange – these were the cries of my boyhood. What a musty period flavour they have now. How utterly out of touch all this is with the problems and opportunities of today.”

In Macmillan’s terms, the “world of make-believe” is all too present in today’s political discourse, whether it’s from arch-libertarians, who think the state can answer none of the questions our society faces, or hard-left socialists, who feel that the state can answer all of these questions. Both are simplistic, utopian worldviews and both are ill-suited to the needs of the day.

This election could well mark the beginning of the end for these utopian political philosophies, as both collide with economic reality and political arithmetic. The Conservatives’ welcome announcement of reformed state aid rules suggests that Johnson’s Tories will not be governed by hyper-libertarianism and that his government is open to the use of the state where necessary.

If the MRP YouGov model (which showed a 68-seat Tory majority) is anywhere near accurate, Labour’s vote is likely to fracture in former heartlands, where voters are tired of being mocked, ignored or taken for granted by both parties. Some polls have given the Tories a lead of up to 20 points among working-class voters. If seats as traditionally Labour as Bishop Auckland and Leigh do end up voting Tory, that should give Labour much pause for thought. It should also prompt the Conservatives to start thinking about how to turn what could be a passing affair into a longer-term relationship.

The challenge for them is not just to overcome decades of cultural hostility to Tories in the so-called “red wall”, but also to consider how a partial shift, based on support for Brexit and hostility to Jeremy Corbyn, becomes a lasting realignment. To do this, modern conservatives must move well beyond utopian libertarianism and remember the depth of conservative philosophy, which understands the importance of the role of the state. Only by doing so can they genuinely tackle the country’s problems and the underlying causes of the Brexit vote, which saw Middlesbrough vote Leave by 30 per cent, Durham by 15 per cent and Sunderland by 23 per cent. 

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Conservatism is, after all, a multi-layered and complex philosophy — an entirely different philosophical creature to the simplistic sloganeering of much of the libertarian right and socialist left. And a crucial part of this philosophy is an active and important role for the state.

Though some on the right deride this approach as “Milibandism”, a commitment to thoughtful government intervention lies deep within the Conservative tradition. Benjamin Disraeli’s totemic Crystal Palace speech in 1872 made the case for social reform and state activism with the aim of “elevating the condition of the people”. As Rab Butler pointed out, this has been part of the Tory tradition since Bolingbroke in the 18th century. Conservative peer Hugh Cecil went as far as arguing that “modern Conservatism inherits the traditions of Toryism, which are favourable to the activity and authority of the state.”

Reviving a Tory theory of the state matters more than ever today — recognising the importance of the market economy to wealth creation but also the power of the state in providing infrastructure and ensuring that nobody is left behind. Tories also understand that an unfettered market, like unfettered identity politics, will cause a more atomised society, with a negative impact on things that conservatives hold dear, such as community and family.

Conservatives should understand that mobility and freedom cannot always be dominant. Concepts such as community, security and belonging are equally important. The state should play its role in reviving the economy of towns across the country not only so that the economy can be rebalanced, but also so that the only measure of success isn’t the kind of economic mobility that means leaving your community behind.

Some argue that merely rolling back the state will allow a hundred flowers of capitalism to bloom. In places such as my home town of Consett, once a proud steel-working town but now both “post-industrial” and “left behind”, such state-shredding talk is little more than fantasy. Consett is emblematic of towns across the country, from places still reeling from the loss of a once-dominant industry to once-buoyant seaside towns suffering from a decline in domestic tourism.

Consett is also, to many people’s surprise, being talked of as a Tory target at this election. What is clear is that there is no real appetite for state-shrinking libertarianism in the kind of Leave seats that Tories must win and then retain. Instead, a One Nation platform should seek to ensure that the economy works as well for towns like Consett and Blackpool as it does for the City of London.  

These forgotten towns are all suffering from a concentration of jobs that are generally low-skilled and low-paid. The towns are hamstrung by poor infrastructure and a dwindling of community facilities. The scale of these divisions is shown by the fact that Gross Value Added per head is almost £50,000 in London and as low as £16,000 in County Durham. Productivity in regions like the North East also lags well behind the national average. There’s no evidence that an approach that simply lets the market rip will do anything other than make existing problems worse. Without an active government taking measures around infrastructure, skills and community investment, any measures purely rolling back the state will merely cause existing disparities to widen even further. 

The truth is that forgotten towns like Consett need both more market and more state. They need a more dynamic private sector-led economy, but that isn’t going to be achieved without an active and intelligent state. That’s why I propose a radical series of One Nation measures in my recently published book Little Platoons. The goal of these measures is to achieve a skills-based reindustrialisation of long-forgotten towns, including devolving powers to local communities and giving them the power to do whatever it takes to attract investment and create economic renewal through new and transformative “prosperity hubs”.

I argue that the UK needs a programme of national reconstruction, with the goal of ensuring that our long-forgotten towns have world-class infrastructure, including long-neglected transport links between towns. A One Nation approach should also involve a revival of the emphasis on skills that helped drive these towns to their industrial peak in the first place, with a revolution in vocational education and a drive to increase research and development spending in our towns. This economic transformation should be overseen by a cabinet minister with the sole responsibility of narrowing regional economic divides.

This election could mark an important crossroads for British politics, with many once safe Labour towns potentially voting Tory. If Conservatives are to make this shift a lasting realignment, they must deliver an economic transformation that goes beyond just delivering Brexit. 

That means making One Nation more than just a slogan and remembering that it represents an important political tradition. That tradition is more important now than ever, with decades of political neglect of many parts of the country meaning that we’re now painfully close to Disraeli’s “two nations between whom there is no discourse and no sympathy”. Laissez-faire liberalism is not going to heal this two-nation divide and nor is one-dimensional state socialism. Instead, the Conservatives should prioritise a One Nation agenda that revives long-forgotten local economies and reinvigorates local communities. 

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