The Red Tory: an economic vandal?
Today, former Conservative adviser Rupert Darwall takes Phillip Blond’s “reinvention” of British Conservatism to task for failing to understand how markets operate. Darwall takes the baton from Kieron O’Hara, who yesterday sought to rescue liberals like Adam Smith from the naughty step upon which Blond’s cover story had placed them.
For all the eloquence and colour of Blond’s arguments, his proposals would make the oncoming recession worse than it is already doomed to be, argues Darwall. The economy would be smaller, living standards lower and taxes higher. And breaking up Tesco would be a piece of “economic vandalism” sure to create headaches for a future Conservative government.
Darwall’s article is the second in a series that we will be running this week that take issue with Blond’s bold call for a new “Red” direction for Toryism. Later in the week we will have David Green, director of Civitas, and Catherine Fieschi, former director of Demos, weighing in on the debate. All articles will be free to read online, and as always we’d love to hear your views.
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I think Darwall’s probably right to criticise Philip Blond’s ‘red toryism’ on the grounds that simply going smaller and more local would be going unacceptably backwards. Of course it would dramatically reduce economic productivity which is (broadly) a good thing.
But attacking government intervention on the grounds that markets are “made up of constantly adapting chains of mutually advantageous exchange between buyer and seller” seems odd. Clearly, not all exchanges are mutually advantageous; Americans who defaulted on sub-prime mortgages haven’t, for example, been advantaged. If I buy a bad apple from a Tesco, the exchange hasn’t benefitted me at all. I’ve lost out.
And sometimes this situation is made worse by size and centralisation. Like when I have to drive to the nearest Tesco because it’s the only nearby place I can buy clotted cream, only to realise on returning that I’ve spent more on petrol than the cream was worth to me. Yes, this happens because of my short-sightedness. But short-sightedness is part of the economy too.
When it comes to banks, localism doesn’t seem like the answer, for the reasons given by Darwall. But organisations that build good relationships with their customers and with each other certainly do. This may well mean finding ways of dispersing capital, since it’s hard to build good relationships when you’ve got too hierarchical a structure. If achieving this requires heavy-handed government intervention to prevent ‘bad’ exchanges, perhaps that’s not so bad.
One of the many paradoxes in the Red Tory argument is that it inveighs against the evils of the interventionist state but requires that intervention in order to sustain its localist vision
of political economy. Personally I am in favour of expanding the role – and number – of local Post Offices because in small towns and rural areas , they provide an important service.
But Darwall is absolutely right – this has nothing to do with any strategy for dealing with the recession or the impact of globalisation ….
No ideal of liberalism can support the cataclysmic collapse of personal wealth % held by us bottom 50% as described by Blond.A modicum of personal discretionary capital is essential to full personal freedom today.
However, the chance of social mobility within a more equal society is a freedom which Blond fails to recognise as such. There are probably are some niches which are unworrying to be locked into; there are certainly some others where a chance of change is essential to the freedom of those willing to strive.PW