Corbyn was foolish to take on nation’s favourite entrepreneur
The business of Britain is business. Voters know that. The Tory party has always known that. Labour, however, had to learn it the hard way during the Eighties. The revival that led to Tony Blair’s election victories started when Neil Kinnock sent John Smith out on the “prawn cocktail” circuit – wining and dining with business to prove that Labour were safe again.
From the election of Kinnock to the defeat of Gordon Brown it seemed as though Labour has not only learnt this lesson but that it had been hardwired. Like so much else about the Labour Party, this started to go wrong when Ed Miliband was leader. He talked about the dangers of predatory capitalism. This was a major error for two reasons. First, he was unable to name any businesses which were either good or bad capitalists. Second, he had profoundly misjudged the public mood. Miliband believed that the global financial crisis had made voters more sceptical about business and willing to countenance anticapitalist measures.
In the event, Labour’s shift to the Left was met by an electorate that moved to the Right and gave the Tories a majority.
As ever, Jeremy Corbyn has decided to double down, indeed treble down, on Ed Miliband’s errors. If voters suspected that Labour were anti business under Ed’s leadership, Corbyn wants to leave them in no doubt at all.
The extraordinary gaffe of “traingate” should have been closed down as quickly as possible with a swift admission of the error and an apology to Virgin Trains. Instead, Corbyn decided to dig a deeper hole for himself by conceding that Virgin were right to say that there had been seats on the train but simultaneously opening a new front by attacking Sir Richard Branson himself.
This ad hominem attack was reckless because Branson is one of the most popular businessmen in Britain – the antidote to Sir Philip Green. Worse, the attack was on the grounds that Branson was a “tax exile” who received subsidies from the taxpayer. The latter allegation was a schoolboy howler – Virgin pays a premium for the privilege of running the East Coast Main Line service. The former was a worse misreading of the public mood than Ed Miliband ever made. Corbyn is attacking Branson for being a successful businessman who has a private island in the Caribbean. Most people don’t resent that, they envy it.
Corbyn’s error is that he thinks the rest of the country is like him and hates successful businesses and the people who run them. For Jeremy, profit is not just a dirty word it is something that should be eliminated. In this he is massively at odds with the public. To listen to Corbyn speak you would think that the public sector is the most important – indeed only – part of the economy. In fact, it is an increasingly small employment sector. Just under six million people work in the public sector. Over 24 million work in the private sector – that is to say, four times as many workers have private sector employers as public sector ones.
The tragedy for business is that while Corbyn stands out for his opposition to enterprise, the political class as a whole are lukewarm in their support for business. Just look at the way the average select committee treats private providers of public services. Even Tory MPs are suspicious of profits, seeing them as in some way having been “stolen” from the public purse, rather than being a fair return on capital, innovation and expertise deployed. And the Government, at least under Cameron and Osborne, thought little of imposing extra burdens on business – like the “living wage” – without making any assessment of costs or impact.
In the face of the economic uncertainty that Brexit brings, there is only one thing of which we can be certain – it will be the private sector that delivers the jobs, growth and wealth that Britain needs. Infrastructure is currently the great cry of Tory ministers and backbenchers looking for a quick economic fix. But the difference between pork-barrelling and economic development is the enterprise unleashed. Politicians don’t create jobs – though they can certainly destroy them; businessmen and women do. In the absence of a Tory government which understands and promotes the case for capitalism, there is an obvious gap in the political market – one that a pragmatic Labour Party could fill. There’s a need for a party that makes the case for a profitable and growing private sector that is a good thing in its own right, not merely a cash cow from which to squeeze tax.
This is why the costs of the fight that Corbyn is picking with Richard Branson are so high. It is not just that Jeremy is abandoning potentially profitable political ground nor that he is positioning himself against success. It is that he is showing himself to be utterly disconnected from and ignorant about the lives of most people in Britain. By attacking the private sector, when he is not simply ignoring it, Corbyn alienates 80pc of the country’s workers.
In terms of winning elections this is a disaster. Labour lost the last general election because it was not trusted on the economy. Corbyn’s approach confirms the worst fears of voters and seals Labour’s electoral fate.
‘Corbyn’s error is that he thinks the rest of the country is like him and hates successful businesses’