The Conservative Party is politically and intellectually exhausted. This summer’s leadership contest has only confirmed as much.
Britain has profound problems: falling living standards, overwhelmed public services and a broken constitution. But rather than grappling with these issues, the Tories have embraced a parodic form of Thatcherism.
Liz Truss’s principal proposal is to cut taxes by more than £30bn, which includes abandoning the planned corporation tax rise from 19 to 25 per cent. Yet there is no reason to believe this would lead to the economic renaissance that she promises. Rather than stimulating business investment, past corporation tax cuts have been squandered on shareholder dividends.
Rishi Sunak has denounced his opponent’s plan as economically reckless, but this is a difference of degree rather than kind. The former chancellor has also vowed to cut taxes once inflation and the national debt have fallen. Ms Truss and Mr Sunak merely offer variations on the same dogmatic, free-market theme.
[See also: Thatchermania won’t save the Conservative Party]
There is, of course, a case for reducing taxes on the low-paid at a time of surging inflation. But to believe that the UK’s main problem is its tax burden is a profound misdiagnosis. The reason Britain has fallen further behind competitors such as the US and Germany over the past decade is its parlous productivity growth (output per hour rose by just 0.7 per cent between 2009 and 2019). Investment in skills and infrastructure, not poorly targeted tax cuts, is the best remedy.
At one time, the Conservatives appeared to understand this. When she became prime minister, Theresa May vowed to address the UK’s “burning injustices” and, for a period, Boris Johnson championed “levelling up” as a means of reducing regional inequality. But Ms Truss and Mr Sunak show no interest in translating such rhetoric into reality.
In other respects, too, the candidates do not represent the choice this country deserves after three years of Mr Johnson. Unlike earlier Tory leadership candidates, such as Jeremy Hunt and Tom Tugendhat, both served in Mr Johnson’s cabinet. They are irrevocably tainted by the man who so debased political and public life. Indeed, Ms Truss has unashamedly offered herself as Mr Johnson’s ideological successor.
Both candidates are also ardent Brexiteers – Mr Sunak by conviction, Ms Truss by conversion – but they have learnt the wrong lessons from the Leave vote. Rather than an appeal for ultra-Thatcherism, Brexit reflected the public desire for a more protective state as well as a new political and economic settlement.
[See also: A fatal attraction]
After the Conservatives won their biggest parliamentary majority since 1987 at the 2019 general election on a crude pledge to get “Brexit done”, many anticipated a new era of Tory hegemony. But the party’s grip on power is precarious. The decline has been rapid.
For the UK’s opposition parties, this is an unexpected opportunity. At no time since the Conservatives returned to office in 2010 has their defeat been more conceivable.
As we have argued before, Labour, the Liberal Democrats and the Greens should embrace tactical voting as a means of dislodging the Tories. But rather than waiting to be gifted power, the opposition needs a programme worthy of these times. The UK needs transformative economic, social and constitutional renewal. This should include electoral reform, the abolition of the House of Lords and more devolution from Westminster to the nations and to the regions of England.
Ever since the 2008 financial crisis ended the long post-Cold War era of ideological consensus, voters have issued a series of warnings: the 2014 Scottish independence referendum, Ukip’s surge at the 2015 general election, the SNP’s dominance at Holyrood, the 2016 Brexit vote, the rise of Corbynism, the hung parliament of 2017. Rather than addressing the root cause of this discontent, Mr Johnson offered a succession of populist distractions – and his project inevitably unravelled.
Now Mr Sunak and Ms Truss summon the chimera of market prosperity and a shrunken state, raising yet more false hopes. The British electorate deserves far better. But in an era of mediocre leadership, does any politician have the courage – and the vision – to break Britain’s impasse?
[See also: Nadine Dorries and the earrings of power]
This article appears in the 27 Jul 2022 issue of the New Statesman, Summer Special