At this time when it is natural to reflect on the state of the nation, some readers might be forgiven for feeling the “Roaring Twenties” are proving something of an anticlimax, thus far. (Not that the 1920s – in Britain as opposed to America – were up to much either. We kept having all those strikes.) Three years ago, it all seemed so promising, with a bold and optimistic Prime Minister embracing a new era of Global Britain. Progress remains distinctly sluggish.
For those of us who regard free enterprise as the means of national salvation, the brief premiership of Liz Truss proved a false dawn. It has surely set back our cause. Though plenty of alibis can be offered.
One is that the problem was her reluctance to signal a reduction in state spending – this case is set out by one of her comrades, Simon Clarke MP, in The Critic. This was of particular importance, given the need to offset the huge spending increase she announced with the Energy Price Guarantee.
Another case is that if she had been given the chance to persevere, the political and economic turbulence would have abated and the tax cuts announced in the Mini Budget would have delivered the promised growth and increased revenue for the Exchequer.
Then there is the case that she was unfairly blamed for the failings of others – notably the Bank of England and Rishi Sunak, who should be blamed for the Quantitative Easing that led to increased inflation and inevitably higher interest rates too.
Finally, it could be argued that her downfall was not due to her philosophy but her personality. A lack of deftness in managing colleagues. A timidity in facing Parliament and the media when she needed to come out fighting.
Perhaps there was a bit of all these factors. But let’s face it, the result was a bodge-up. It has left free marketeers at a low ebb. I remember Ralph Harris, the founder of the Institute of Economic Affairs, remarking that he despaired when Enoch Powell gave the “Rivers of Blood” speech in 1968. Powell was the most eloquent and unapologetic champion of economic freedom in Parliament. Harris felt that Powell’s outspoken views on race would tarnish his views on economics. That it would set back the cause. Albeit in a very different way, has Truss not queered the pitch for the rest of us seeking to make the case for a smaller state?
I don’t think we should give up just yet. Sunak may emerge as a lucky Prime Minister. The price of wholesale natural gas has been falling pretty dramatically in recent weeks. That should help the public finances and allow room for some of the tax increases to be eased.
2023 could be the year that we finally do grasp the opportunities of Brexit – in a way that might not make the front pages or the airwaves. Greg Hands, the Minister for Trade Policy, has written for this site about the importance of our joining the Comprehensive and Progressive Agreement for Trans Pacific Partnership. Then we have the changes to Solvency II to liberate the insurance industry from the shackles of EU regulation. These are the sort of changes that combine being immensely tedious and greatly enhancing our economic prospects. They will play to the Prime Minister’s strength – with him devouring the details of such reforms in a way that not all his predecessors would have had the capacity for. He will grapple with the complexity so you don’t have to.
Very well. Let us suppose the economic forecasters are confounded – which has happened often enough in the past. What if the economy performs more strongly than many expect? The economy was doing well in 1997 but it was not enough to secure a fifth consecutive Conservative election victory. Would it next year? Probably not on its own. The NHS will need to be reformed – simply pouring money into it has proved futile. Some technological breakthroughs offer a slither of hope. If we are to secure our borders it will probably mean withdrawing from the European Convention on Human Rights – something which would surely mean a Parliamentary rebellion and perhaps one or two Ministerial resignations. Sunak is more capable than Sir Keir Starmer but where is the Conservative policy offer for the future? It is imperative for the Conservatives to restore their credentials as the party of home ownership.
Public opinion is volatile. The Conservatives found this out to their cost in the 2017 General Election. Voters are much more erratic than they used to be. When I was canvassing 40 years ago, one would find a strong tendency of all those in a household to vote the same way; also voting the same way as last time. Politics was tribal. Often people voted according to class, skin colour, how their family had always voted. This unconditional voting is much less normal. We are all floating voters now. That is healthy in a democracy. Yet it makes predictions trickier.
Defeatism can become self fulfilling. But the Conservatives are not yet at that stage. The nation can recover if the right choices are made. The reward could then be the Conservative Party’s electoral prospects.
Happy New Year.