People are losing faith in capitalism. Ten years on from the financial crisis, there is a continuing backlash which fuelled Jeremy Corbyn’s surprising electoral performance. In their anger and frustration with capitalism, ordinary people, especially the young, are starting to be attracted to socialism once again.
Many of the people who voted a few weeks ago weren’t even born when socialism drove Britain to the brink with financial bankruptcy, rampant inflation, and paralysing strikes. It is no longer good enough for Conservatives to point to a largely forgotten past to prove their point. They need to make the case for capitalism from first principles. This requires teacher-politicians who can say why capitalism is worth conserving. It just so happens that one of the party’s greatest teacher-politicians was also a populist who turned back the tide of socialism, namely Margaret Thatcher.
Much like Corbyn's candidacy in the Labour leadership election, Thatcher was not supposed to win the contest to succeed Ted Heath. As the middle-class daughter of a grocer, Thatcher was an outsider, excluded by the upper echelons of her party because of her gender. Thatcher’s victory has gone down in history as a “peasants revolt” due to her support from backbench MPs who defied the patrician elite which had traditionally run the party.
The economic philosophy Thatcher championed was also a rebellion against an establishment which insisted on clinging onto the failed policies of the post-war consensus. When she made the case for capitalism, Thatcher wasn’t speaking for the corporate interests. She was speaking for a free market populism, of how capitalism can empower the people as wealth creators and property owners. The genius of Thatcher was her ability to translate this capitalist message into the language of everyday struggles experienced by ordinary people.
For Thatcher, fiscal responsibility was a statement of how taxpayers should be trusted to run their own lives, and spend their own hard-earned money, free from interfering elites in Westminster. Cutting taxes and spending did not just boost economic growth and revenue, it was also moral. This argument was put in simple and effective terms which ordinary people across the country could understand. Thatcher believed “Everyone has to live on a budget, the government has to live within a budget, and our good housekeeping has made our economy sound and strong”.
Another enduring legacy of Thatcher’s free market populism was the “property-owning democracy”. Thatcher introduced the Right to Buy scheme and advert campaigns, such as “Tell Sid”, to promote the privatisation of utilities and industries. The result was a substantial increase in the number of homeowners and shareholders in Britain. Economic power would be transferred from the state to ordinary people. It was a seismic shift in the British economy which rewarded aspiration and provided opportunities in a way which socialism can never match.
The free-market revolution of the 1980s restored economic prosperity to the country after the decline and decay of the 1970s. But the fall of the Berlin Wall has ushered in an economy with fewer opportunities, and more problems for ordinary people. Multinational corporations easily avoid paying taxes and “too big to fail” banks are bailed out for crashing the economy. People are working longer hours for less money, less likely to own a home, and face a rising cost of living. The problem is cronyism, a capitalism which is undermined by the relationship between big business and big government.
Theresa May has acknowledged these problems during her tenure as Prime Minister, and attempted to use state interventionism to build her own brand of populism. But it failed to win a convincing victory against Corbyn’s socialism at the ballot box. As Conservatives reconsider their mission and their policies, it would be worthwhile to examine how Thatcher’s free market populism succeeded in restoring Britain’s prosperity and pride. It is the Conservative party's best chance of creating the next generation of capitalists.
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The loss of her parliamentary majority has fundamentally changed Theresa May’s mission as Prime Minister. For the next two years, May will try to fight tooth and nail to fulfil Vote Leave's promise to take back control. Whether or not she makes it beyond this year’s party conference is a different matter, but May is determined to carry on.
May’s major Bills in her first (and almost certainly her last) Queen’s Speech are all related to Brexit. This was always going to be the case given the need to pass the Bills before March 2019 when Britain formally exits the EU. May is sticking by her Lancaster House speech. British sovereignty will return over trade, immigration, laws, territorial waters, agriculture, nuclear safeguards, and international sanctions. This is all in line with the government’s plan to leave the customs union and the single market.
Some tweaks have been made to May’s Brexit plan. The government’s tone on Brexit has softened as the Queen’s Speech made a commitment to “secure the best possible deal as the country leaves the European Union” and “build the widest possible consensus on the country’s future outside the European Union.” Despite the toned down rhetoric, Brexiteers will loudly support May for fear of a leadership contest leading to a new “soft Brexit” Conservative leader or triggering an election in which Labour wins a majority.
This will be a two-year long legislative slugfest which exposes divisions across the two main parties over Brexit. Although both the Conservatives and Labour pledged to leave the single market and customs union in their manifestos, there will be resistance from the backbench MPs opposed to what they call a “hard Brexit”, including the Tory awkward squad led by Anna Soubry and Nicky Morgan, and at least 34 Labour MPs. The House of Lords and the Scottish Parliament also have the power to derail the Brexit Bills.
As a lifelong Eurosceptic, how far will Jeremy Corbyn go in collaborating with the Conservatives to implement Brexit? Since the election campaign ended, Corbyn and the Shadow Chancellor, John McDonnell, have repeated their manifesto pledge to honour the Brexit result. Attempting to thwart Brexit, by for example blocking the Repeal Bill, could risk the wrath of their pro-Brexit working-class supporters who left UKIP for Labour two weeks ago.
Domestic policy in the Queen's Speech was an entirely different affair. For the past year, May has been crafting her analysis of how the failures of the political class led to the Brexit result and what can be done to correct these failings. The manifesto which addressed these problems and formed the basis of May’s mandate for change has now been shredded. With the loss of a majority, and the bandwidth being consumed by Brexit, this is unavoidable. Policies such as grammar schools, the so-called “dementia tax”, and cuts to pensioner benefits will not see the light of day.
But while the details of Mayism have been changed, the general direction of travel has not. Measures were announced to put an industrial startegy into action through technical education reform and infrastructure investment, inject fairness into markets such as energy and housing, tackle social problems related to domestic violence and mental health, and respond to the challenges of extremism and terrorism. These are all worthy, if unambitious, proposals to help improve the country and keep the flame of Mayism alive during and beyond the Brexit process.
Conservatism is at a crossroads. Instead of witnessing the beginning of a Tory renaissance under a Mayite revolution, Conservatives are questioning whether or not their party even has a future. The Spectator has declared this moment as “The dying of the right”. It is an existential crisis which May is not capable of resolving in light of her failed election gamble. But May could, perhaps successfully, steady the party through the Brexit process and be remembered as an honourable, albeit flawed, Prime Minister.
Theresa May came to power with a clear vision for modern Britain. The Conservatives appeared to have found a leader who recognised and understood the barriers to success for many in British society.
May and, her Chief of Staff, Nick Timothy’s agenda for economic and social reform would build “the world’s great meritocracy – a country where everyone has a fair chance to go as far as their talent and their hard work will allow”. It is a message of empowerment for everyone regardless of their class, age, gender, race or sexuality, and was a fundamental theme in the Conservative manifesto. But it was never included in the election campaign message. One of the many mistakes made. The party needed a positive message of aspiration and opportunity to inspire voters.
Speaking for those who are “just about managing” is also becoming an electoral necessity due to the changing nature of the Conservative party’s support. This year the Conservative party gained its highest level of C2DE (working-class) support since 1979 with an astonishing 12-point increase on its 2015 performance, and Labour leading by only four-points. Conservatives led among people with no qualifications by 17-points, whereas Labour had a 15-point lead with graduates.
There is also an interesting story to tell in the Midlands and the North of England. The Conservatives won five Labour strongholds which voted heavily for Leave; Mansfield, Middlesbrough South and East Cleveland, North East Derbyshire, Stoke-on-Trent South, and Walsall North. Copeland was also held by the Conservatives, which they gained in a sensational by-election a few months ago. There were swings to the Conservatives across seats in the North East and the Midlands. To the surprise of many in last month’s local elections, the Conservatives won the West Midlands and Tees Valley mayoralties.
British politics is still undergoing a realignment, and class is becoming less of an indicator of how people will vote. May and Timothy saw how the Conservatives are gaining working-class support and have an opportunity to flip seats which have been held by Labour for decades. But many working-class voters who had left Labour for UKIP decided to back Corbyn instead. Breaking through in Labour’s heartlands will require more hard work to be done by the Conservatives.
Today’s Queen’s Speech is rightly focused on the process of implementing Brexit, but it is still disappointing to see how many of May and Timothy’s policies have been discarded, especially the grammar schools policy. This should not stop Conservatives from continuing to explore Mayite ideas and policies. Rob Halfon has already set out his proposals for turning the Conservatives into a modern workers’ party, and his departure from government is disappointing at such a crucial time.
Instead of retreating to an ideological comfort zone, the Conservatives should learn from the best Mayism has to offer. That means saving May’s idea of a great meritocracy which spreads opportunity to working-class voters left behind by globalisation. If the Conservatives continue to be seen as the “party of the rich”, then the party will struggle to win a majority. The centre of gravity is shifting in British politics and the Conservatives must exploit it for maximum advantage. This means Mayism continues to be a vital and desirable idea.
Ever since the exit poll flashed on television screens across the country, speculation has been rife as to who will succeed Theresa May as Prime Minister and leader of the Conservative party. May now serves at the pleasure of the Cabinet and is stabilising the new minority government as Brexit negotiations begin. For now, Conservative ministers and MPs insist May will stay as leader for the long-run. But calls for a leadership election are growing in the centre-right press, especially after the clumsy response to the Grenfell Tower fire.
Even if May does remain in office to oversee the next two years of Brexit negotiations, there will be a constant stream of stories about who her successor will be, and there is already a clear field of candidates. Commentators understandably focus on the personality traits of politicians when judging their suitability for high office, but principles and ideology matter as well. Each candidate would mean different things for the future of Conservatism and Brexit at a moment when British politics is in flux.
Among the ground troops of the parliamentary Conservative party, there are two broad camps; the Tory right and the Tory mainstream. The Tory right has a serious and credible candidate with David Davis who has impressed many during his tenure as Brexit Secretary. Brexiteers trust him to implement the Brexit blueprint set out in May’s Lancaster House speech, more so than any of the other candidates. As a free-marketeer and civil libertarian, Davis would make the economic liberals and libertarians in the party very happy indeed. Davis’s humble background also makes him attractive as a Conservative in the Thatcherite tradition. The only risk is that Davis as leader could be interpreted by the electorate as a step back to the pre-Cameron era of the “nasty party”.
As for the Tory mainstream, the centrist wing of the party, there is a weaker and more fragmented field of candidates. Nicky Morgan and Jeremy Hunt are well known to harbour ambitions for the top job. They lack the seniority or support enjoyed by their rivals but could still throw their hats into the ring. Philip Hammond is the big beast in this camp who could stand for the leadership. This is very much the home of Tory Remainers who want to see a “soft Brexit” which puts jobs and growth before controls on immigration, and Hammond has consistently been their spokesman in the Cabinet. The risk of Hammond as leader would be a large-scale Brexit backlash from Leave voters in the next election.
Then there are the Tory modernisers, the officer class which ran the party under David Cameron. There is a divide within this camp over Brexit between the Osbornites and Borisites. George Osborne is no longer in Parliament but he still has an influential network of allies which he cultivated during his time as Chancellor. The most formidable of these allies is Amber Rudd, the Home Secretary, who had a “good war” during the election campaign and has been a strong advocate for Tory Remainers in Cabinet. But Boris Johnson, the Foreign Secretary, is attractive to many Tories as the populist who led the Vote Leave campaign to victory with a positive, liberal case for Brexit. Since his return to Cabinet, Michael Gove could become a kingmaker between Rudd and Boris. Despite their differences on Brexit, both candidates would return the party to the liberal Conservatism of the Cameron-era.
Noticeably, there is no faction of Mayites ready to back a candidate who shares May’s vision for a communitarian conservatism which charts a middle way between globalism and nationalism. May’s manifesto is being torn up and Nick Timothy’s ideas discredited because of the disappointing election result. There were certainly mistakes made in the manifesto and the election campaign, but there is much in Mayism which can help the Conservatives prosper in the future.
The next Conservative leader faces a difficult electoral challenge. He or she will have to reach out to the working-class Leavers, middle-class Remainers, public sector workers, and young people who fuelled the Labour surge. Falling back on old ideological templates will not help. Brexit has reshaped the political landscape and the Conservatives will have to adapt in order to survive. Conservatives cannot wait until a leadership election to discuss the party’s future. The conversation will have to start now and could very well decide whether the party has a future as a majority party.
London suffered another devastating blow with the Grenfell Tower fire. The horrifying loss of life and the justified anger of the local community has been shamelessly exploited by Jeremy Corbyn and the hard-left to score political points against the government. But the Conservatives are now at risk of losing one of the most important elements of the party’s identity; compassionate conservatism.
After eight long years in opposition, David Cameron made it his mission to restore the Conservatives’ credentials as a party of compassion. As a “Modern, Compassionate Conservative”, Cameron emphasised the need to protect public services, support greater tolerance, and increase international aid. Compassion became a defining theme across the wider conservative movement. Iain Duncan Smith and the Centre for Social Justice provided conservative solutions to the root causes of poverty, and Tim Montgomerie supported the philosophy of compassionate conservatism on Conservative Home.
This wasn’t a cheap soundbite or a triumph of style over substance. It was an extraordinary rebirth of the party’s One Nation tradition of social reform. Cameron was passionate about fixing Britain’s “broken society”. Before he became Prime Minister, Cameron said “I'm going to be as radical a social reformer as Mrs Thatcher was an economic reformer.” Cameron stayed true to his word and oversaw major education and welfare reforms which have helped raise standards in schools and boost job creation. A few months before his resignation, Cameron also outlined a positive vision for tackling poverty with his Life Chances agenda. By using Conservative solutions to help the most vulnerable in society, the party was able to make itself more appealing to voters.
When Theresa May came to office, much of this agenda was side-lined and the Life Chances strategy was shelved. May wants to use the One Nation tradition to focus on helping the “just about managing”, the working-class voters who have been left behind by globalization and voted to leave the EU. It is certainly right that the Conservatives should champion blue-collar voters and shed its image as the “party of the rich”. But during the election campaign, the party forgot to talk about helping the poorest in society, and left the manifesto open to attack by Labour.
As the party licks its wounds and prepares for the next election, Conservatives should assemble a full spectrum agenda for social reform which brings the best of Cameronism and the best of Mayism into synthesis. The party can and should make life better for working-class voters as well as helping the poor. Only with a credible and broad agenda for social reform can the Conservatives hope to take the fight to Labour and prove that outdated socialist policies simply do not work.
Renewing the party’s commitment to compassion is also about our values as Conservatives. We have to show that Conservatism is not about materialism or self-interest, but about responsibility and caring for the common good. For almost two hundred years, the party has produced social reformers with moral fervour. Lord Shaftesbury, Richard Cross, Joseph Chamberlain, and Rab Butler are just some of the great reformers who helped make the One Nation tradition. Compassion has always been part of the fabric of Conservatism.
Corbyn has the advantage now because many voters believe he is leading the more moral party. But it is not enough for Conservatives to point out the ugliness of the hard-left. Conservatives need to show they have a compassionate agenda to heal the divisions in our society, as well as a moral philosophy which values the weak and the vulnerable. People should be able to feel that voting Conservative is a vote for a better and more compassionate country.
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The Conservative party has a youth problem. This isn’t news. Party strategists have long ignored young voters as they are unlikely to actually turn up on polling day, unlike the elderly. But the young have finally made their voice heard.
Jeremy Corbyn reached out to the young and inspired them. They are still the least likely age group to vote, but there was a healthy increase on their turnout in 2015 with 57% of 18 to 19 year olds and 59% of 20 to 24 year olds turning out to vote last week. Only 19% and 22% of these age groups voted for the Conservatives. The Conservatives have become a party for the asset-rich elderly with dwindling support from the young.
The young are among those left behind by the current economy. Many young people struggle to pay off their student debts, find a job, get onto the property ladder, start a family. This means it takes longer for the young to settle into adult life. Labour’s manifesto made unrealistic promises to the young like scrapping tuition fees, but the Conservatives’ manifesto did not even try to win them over.
Healing the divide between the generations has become a pressing necessity for Conservatives. As the party which believes in a “property-owning democracy”, the Conservatives are well placed to offer realistic and popular solutions. Noel Skelton MP first coined this term in 1923 as part of his vision for a “Constructive Conservatism” which could elevate the economic wellbeing of the people. Conservatives can carry on Skelton’s ideas by tapping into young people’s aspirations and helping them become homeowners and savers. If the Conservatives fail to extend property-ownership to the young, then they will not have a future as a majority party.
Not only does the Conservative party need to produce popular policies for the young, it also has to communicate with them more effectively. In an age when Twitter helped Donald Trump win the Presidency, the power of digital media can no longer be dismissed as trivial. Even with the power of the right-wing paper press, the Conservatives failed to win a majority, while Labour nimbly used social media platforms like Snapchat and Facebook to engage with young voters. In Scotland, Ruth Davidson proved that Conservatives can be social media savvy and electorally popular. Unlocking the potential of digital media is now essential in our democracy and crucial for attracting young voters to the party.
As well as energising young supporters online, the Conservatives need to mobilise them on the ground. With the help of Momentum, Labour was able to send armies of young grassroots activists to key seats. The Conservatives’ recent experiences with young activists has been more bleak. Ever since a major bullying scandal which was exposed by the tragic suicide of Elliott Johnson in 2015, the party has ceased to have a functioning national youth wing. Lessons have to be learnt from what went wrong with Conservative Future so the party can create a safe environment in which young activists can make new friendships and support their ideals.
Even if young voters do not turn out in higher numbers for the next election, the Conservative party’s future depends on winning over the young. Conservatism cannot afford to lose an entire generation to socialism. In a democracy, Conservatism also has a duty to speak for all of the people of the country. That means healing the intergenerational divide in Britain and galvanising a new generation of young Conservatives.
As the dust begins to settle, Conservatives have already started to look at why they lost their majority last week. One powerful narrative which has begun to take form is the argument that seven years of austerity have led to public sector workers being left behind while the economy continued to grow.
George Freeman MP, Chairman of the Conservative Policy Forum, believes that the Labour surge was driven in part by “a massive vote by public service professionals (doctors, nurses, teachers, even the police) fed up at the prospect of indefinite austerity”. In an interview with Panorama, between losing his seat and becoming Downing Street’s new Chief of Staff, Gavin Barwell recalled an encounter with a teacher in his constituency who said “you know I understand the need for a pay freeze for a few years to deal with the deficit but you're now asking for that to go on potentially for 10 or 11 years and that's too much.”
The election campaign brought these issues into sharp focus. In the past several months, the NHS suffered its worst winter crisis since 2004, the social care system reached a breaking point, and cuts to police numbers were blamed for the three recent terror attacks. This was not helped by a manifesto which promised to cut pensioner benefits and scrap free school lunches. Voters were not satisfied by the Conservatives’ miserly offer of prolonged austerity and economic competence.
Despite the fascinating ideas outlined in the manifesto’s introduction, there was no “retail offer” to compete with Labour, few policies for Conservative activists to brag about to voters. There were certainly mature, grown-up policies to help the country face the “five giant challenges” of our time. But it did not say how a Conservative government would make voters and their families better off. For all the gimmickry of the 2015 manifesto, it at least told voters clearly how they would benefit from a Conservative majority government.
As the Conservatives begin to rethink their approach towards austerity, it is important to remember that fiscal responsibility is a fundamental Tory principle. Abandoning this principle would be a major surrender to Jeremy Corbyn in the battle of ideas. The national debt stands at a staggering £1.9 trillion and 86% of GDP. This is a burden which millennials will have to help pay off for most of their adult lives. If Conservatives start to oppose all spending cuts, then it is hard to see how the government can keep borrowing and debt under control.
Instead, Conservatives should look at reconfiguring the deficit reduction programme so the burden does not fall disproportionately on hardworking people, especially public sector workers. This year, their wages were cut in real terms due to the pay freeze and creeping inflation. By 2020, average public sector pay could be £1,700 lower than in 2010. The economy might be growing, but this is clearly not being felt by everyone. As an opening move, the Conservatives could increase the cap on public sector pay. The burden of spending cuts needs to move away from the workers who keep our public services running.
In her first party conference speech as Prime Minister, Theresa May declared “we are the party of workers.” Last week’s election results proved that Conservatives still have their work cut out for them. Austerity is necessary, but it has to be implemented in a way which protects workers, the “just about managing”. If the Conservatives want to truly become a party of workers, then that must mean embracing public sector workers.
“For myself, I am an optimist — it does not seem to be much use being anything else.” – Sir Winston Churchill
Hope is an election winner. Politicians who promise a positive vision for the future are often election winners. Last week, Ruth Davidson led an extraordinary Tory revival in Scotland, and Jeremy Corbyn rallied an impressive youth vote. A couple of days ago, Emmanuel Macron won a stunning landslide in the first round of the French parliamentary election. Voters clearly do not just look to their leaders for competence. They look for optimism.
Conservatives sometimes fail to remember this lesson. Realism and pragmatism run deep in the party’s history, sometimes pessimism and fatalism have come through too often. The sober and grown-up approach taken by Theresa May failed to inspire and cost her majority as a result. In some ways, the Conservative campaign was downright off-putting. The constant negativity and sloganeering produced a dreary campaign by a party which did not offer hope.
This has not always been so. Sir Winston Churchill, the Conservative party’s greatest leader, was a bastion of hope during Britain’s darkest hour. Churchill’s memory does not just endure because of his achievements, but also because of his endless capacity to inspire. Margaret Thatcher also spoke to a country in crisis and promised to stop managed decline and restore national pride. The genius of Churchill and Thatcher can never be replicated, but that should not stop Conservatives from putting optimism at the heart of their party’s identity.
David Cameron tried to bring some optimism back to the Conservative party. In his 2006 party conference speech, Cameron famously said “Let optimism beat pessimism, let sunshine win the day.” It is easy for people to mock Cameron’s “hug a husky” and “hug a hoodie” moments during his efforts to make Conservatism more appealing. But what he was trying to do was important. Conservatism cannot endure if it cannot win hearts and minds, if people cannot be proud about the fact that they are Conservatives.
With morale in the Conservative party so low after hopes for a landslide victory were so dramatically dashed last week, the need for optimism cannot be overstated. The country stands at an historic turning point. Brexit promises tremendous opportunities for a more confident and independent Britain. The challenges presented by the party running a minority government remain real and serious, but they can be overcome.
Over the past year, the government established a plan for Brexit which would honour the Brexit result, namely to leave the single market and the customs union. But this plan needs to be sold not just to the British people, it also needs to be attractive to our European friends and allies. An excellent way to kick off Brexit negotiations on the right foot, and appeal to Remain voters, would be to unilaterally grant the right to stay for EU citizens in Britain. The government’s rhetoric should embrace Britain’s cultural links with European nations, and make it perfectly clear that to support Brexit is not to be anti-European.
Difficult times await Britain, but we need to keep believing in the best of our country and its people. It is time for the Conservatives to rediscover their optimism and push forward with a plan for Brexit which shows that our best days are still ahead of us.