Rishi Sunak hasn’t yet grasped the secret of how Mrs Thatcher inspired Britain to strive

The Prime Minister believes sincerely in the free market, but that is not enough to restore growth to an economy lacking in opportunity

On Thursday, on this page, Sir James Dyson created a stir. Britain’s most successful living entrepreneur/inventor made an anguished plea to revive our national understanding of the relationship between tax rates, enterprise and growth. He accused the Government of moving in the wrong direction, interfering too much “in the belief that penalising the private sector is a free win at the ballot box”.

The following day, speaking in Lancashire, Rishi Sunak justified not cutting taxes. “You’re not idiots,” the Prime Minister told his audience, “you know what’s happened.” He pointed to the shocks of Covid and the war in Ukraine. He had to get a grip on the public finances and inflation, he said: the tax cuts he desired must wait.

Both men are making good points. Sir James is clearly correct that the growth of big government, tax and regulation is working against economic growth. Mr Sunak is justified in worrying about wobbly public finances and high inflation. But it is the Prime Minister, not Sir James, who is missing something important.

Earlier this week, on a Whatsapp group of which I am a member, someone posted a short clip of Margaret Thatcher addressing the Conservative Party conference in 1983. For some reason, it was subtitled in Spanish, and rounded off by Verdi’s Chorus of the Hebrew Slaves, which made it seem more universal.

It contained many of Mrs T’s favourite verities, such as “There is no such thing as public money: there is only taxpayers’ money” and “You do not grow richer by ordering another cheque book from the bank.” But what is striking about the speech – as well as its high level of close, consecutive argument backed by main verbs, absent from public life since the coming of Tony Blair – is the coherence of its political and economic account about what her government was trying to do. Forty years on, it resonates.

Mrs Thatcher was speaking, remember, after a severe recession which critics thought her first administration had created unnecessarily. Because of the crisis of inflation and public spending which she faced when she first came into office in 1979, she had controversially decided, in 1981, to put up taxes in a recession.

Two years later – and after victory in the Falklands War – she had nevertheless won the general election with an overall majority of 144. Economic recovery was visible. She felt vindicated at the ballot box.

Addressing the faithful, she drew on our country’s past – what Sir James this week called “an illustrious history of enterprise and innovation” – to explain how economic pessimism had consistently been proved wrong: “There is always a temptation to believe that the dynamism of the past will be exhausted and that the best we can hope for is to share out the work we have already got… That is not how our fathers and grandfathers transformed the standard of living in the Western world. They did not… scan the horizon for the upturn. They were the upturn.”

It followed, she added, that government could not itself create prosperity: it could provide the right framework for people to do so. She felt she could boast: “Visions … have to be worked for, consistently, unswervingly. We have set a true course – a course that is right for the character of Britain, right for the people of Britain and right for the future of Britain.”

There are holes to be picked in the Thatcher story of success. She did not cut the total tax burden as much as she implied and, towards the end, she let inflation creep back.

Nevertheless, she did accomplish something very important in economics and politics – making millions of people feel that they could achieve more with their lives. These included trade union members who recovered democratic rights against their Left-wing bosses, council tenants who could now buy their homes, workers who could buy shares in privatised industries, and young, enterprising people for whom setting up their own business became an exciting possibility.

That sense of promise began to decline under Tony Blair, slid badly under Gordon Brown and has never fully revived. The renewed (if vague) hopefulness which Boris Johnson brought to the subject in 2019 was dashed by Covid.

Since then, Tory ministers have been teetering around like recovering patients, the only exception being Liz Truss, who ran away from the low-growth convalescent home, only to find that she was not yet ready for life outside.

I do not doubt Rishi Sunak’s sincere belief in a free-market economy, or his technical grasp of the issues, but I do notice his temperamental aversion to boldness. He appears to lack a Thatcher-like trust in the innate capacities of the many and feel instead a very Wykehamist deference to the few, especially high officials, economists and central bankers.

This makes him a careful steward of public money (which, after Boris, we certainly need). Mrs Thatcher herself, in that 1983 speech, reiterated how important financial prudence always is. But there are a couple of problems.

The first is that Mr Sunak finds it difficult to put himself in the shoes of the young potential entrepreneur (which are usually less elegant than his own). If you are thinking of setting up a business today, can you have much sense that the authorities are on your side? What with rising national taxes, business rates and interest rates; planning permissions, regulatory burdens, net-zero restrictions; the endless ramifications of the Equality Act and the capture of businesses by woke HR departments, you look in vain for ways through the thicket.

Yes, Mr Sunak seems a decent, intelligent man. You would be pleased to have him as your accountant, but he is not the sort who shares your dreams and fights for your lifechances.

The state of policy is so strange, too. There is much talk of “green jobs”, for example. Some are being produced, but if I were entering that field of business, I would suffer from what the owners of electric vehicles call “range anxiety”. Like an EV that cannot find a charging point, would my enterprise grind to a halt if the subsidy or price regime changed?

If I were starting out, I might conclude that I would be safer as a civil servant, working from home and guaranteed a secure and substantial pension, retiring at least five years earlier than my private-sector counterparts. If I were an older worker, I might slide quietly into part-time consultancy and spend more time in the garden. Apart from the Covid period itself, the sense of opportunity in Britain has not been so low since 1979.

The second effect is political. With Brexit achieved (more or less), the specific reasons for voting Conservative are now few. Ask yourself the classic opinion poll question about which party is best for the interests of you and your family. On what issues do Mr Sunak’s Tories retain a definite advantage? Can you any longer answer that one with confidence?

In recent weeks, Sir Keir Starmer has been working hard to blur any remaining unwelcome distinctions. It was he, not the Prime Minister, at Davos this week. He is talking to business and is edging away from woke issues and towards fluttering Union flags. As Mr Sunak hems himself in by refusing tax cuts, perhaps Sir Keir should beach the Conservatives by promising tax cuts to business and, as Tony Blair did before coming to power in 1997, commit to no increase in the top rate of income tax.

She managed to accomplish something very important in economics and politics – making millions of people feel that they could achieve more with their lives