Monday , July 24 2017

The British Labour Party’s zombie manifesto

If this were, say, 1974, nobody would have batted an eye at the British Labour Party’s election manifesto. But in 2017, a program of renationalization, tax hikes, wage caps and other radically socialist fare isn’t just outdated and impractical; it’s painfully beside the point. This call to return the U.K. to an era of economic dysfunction comes at the country’s most vulnerable moment in decades, with Brexit negotiations looming.
You might say, Why worry? Opinion polls put the Conservatives way ahead of Labour, so it doesn’t matter what Labour says it would do in power. Actually, it does matter.
Britain needs an effective opposition — and if Labour won’t hold the government to account, nobody will. Instead of making the case for 1970s-style socialism, Labour’s leader, Jeremy Corbyn, should be arguing that he, not Prime Minister Theresa May, will better manage the Brexit negotiations and build a close and cooperative future relationship with the European Union.
Granted, the manifesto does have one or two smart things to say on Europe. For instance, it underlines the importance of retaining the benefits of the EU’s single market (though it doesn’t say much about that how to do that). It rightly argues that the question of residence rights for EU citizens in the U.K. should have been settled before the Article 50 exit process was triggered — that it’s both wrong and bad tactics to try to use the status of those migrants as a bargaining chip.
The problem is that such particles of wisdom on Europe are overwhelmed by an old-school Labour catechism of nationalization, workers’ rights, free higher education, higher taxes, more public spending, and increased public control of the economy.
By way of illustration, consider this: The manifesto says the government would use its buying power to force companies under government contract to “move towards” paying their highest-paid executives no more than 20 times the wages of the lowest-paid. If the minimum wage were raised to 10 pounds an hour, as Labour also proposes, the corresponding ceiling for top executive pay would be roughly 400,000 pounds a year. The idea is too far from reality to take seriously: Its only purpose is to announce that old Labour is back.
Britain is one of the world’s most vibrant economies and draws investment from all over the world. Brexit jeopardizes that success, and Corbyn is right to criticize the government’s approach. But a party dedicated to the kind of archaic dirigisme set forth in this program cannot plausibly present itself as the economy’s champion.
Tony Blair revived the party’s fortunes in the 1990s by introducing Labour to real-world economics, and he went on to win three consecutive general elections. With Brexit bearing down, it’s little short of a disaster that today’s Labour Party is intent on turning back the clock. —Bloomberg

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