Faced with Theresa May and Jeremy Corbyn, what will free market liberals do now?

The Prime Minister knows that her capitalist opponents have nowhere else to go. 

NS

Sign Up

Get the New Statesman's Morning Call email.

The biggest victim of the conference season was liberalism. In different ways, both Theresa May and Jeremy Corbyn set themselves against this once triumphant ideology. May promised economic interventionism and stringent controls on immigration. Corbyn offered “socialism for the 21st century” and denounced the “so-called free market system”.

Former Labour and Conservative leaders, such as Tony Blair and David Cameron, were often described as “liberals”. May and Corbyn could never be. To the delight of their grassroots, both have reasserted their parties’ traditional ideologies: conservatism and socialism.

Classical liberals feel increasingly homeless. Adam Smith Institute director Sam Bowman ordered May to “abandon her ideological attachment to interventionist economic policies, look at the evidence and accept that it tells us that markets, not the state, are the solution to our problems.”

What of the alternatives? Liberal Democrat leader Tim Farron declared during the Tory conference: “The Lib Dems are the free market, free trade, pro-business party”. But with only eight MPs (the same number as Northern Ireland’s DUP) they struggle to be taken seriously. Farron’s left-leaning reputation makes him an awkward champion of business.

Ukip, Britain’s third party by votes, is a leaderless shambles. When it stabilises, it is likely to embrace interventionism in search of Labour defectors. The Greens, some of whose European counterparts are libertarian in nature, are committed to socialist economics.

Who should free marketeers vote for? As May knows, most will stand by the Conservatives. Corbyn’s radicalism (and the EU referendum result) gives her licence to pursue a more statist agenda. The protests from business and libertarian think-tanks will likely satisfy her.

By their own logic, May’s liberal opponents should wait for her to fail. Some expect her rhetoric to be unmatched by policies (yesterday’s speech offered few concrete prescriptions - though she has time). Others believe that her “anti-business” stances, combined with single market withdrawal, will prove economically ruinous. At this moment, May’s internal Tory opponents, most notably the Osbornites, could scent blood.

But other free marketeers have responded more pragmatically. “The government is a bit more interventionist than I would be,” James Cleverly MP told me. “But we live in a democracy where we need buy-in from the British people for our policy agenda. What we’re seeing globally is people who feel that free market capitalism is not working for them and they are smashing up the shop. I don’t fancy this particular shop being smashed up.”

To revolting liberals, May’s riposte will be that capitalism needs saving from itself.

George Eaton is assistant editor of the New Statesman.