By Mert Kul, Editor-In-Chief
As the dust settles from the long overdue exile of Boris Johnson from Downing Street, unarguably its most remorseless, narcissistic and debauched occupant, it is natural to feel a combined sense of relief and optimism at the prospect of a new leader taking office. This is a common response shared by many, a result of the chronic mismatch between the often-frustrating stasis or outright disaster that has preceded us and the seeming vast possibilities of the office to, at least in theory, effect real lasting change for the better.
It goes without saying that this optimism is almost always misplaced, and will never be more so than during the upcoming Conservative leadership contest where, whoever takes the reigns, the chances are that we will see another move towards a discredited Thatcherite free market agenda.
Even if for entirely populist reasons, Johnson presided over a significantly larger role for the state within the British economy, where those forced to choose between eating and heating could expect to see some significant relief during the cost-of-living crisis, even if only for the purpose of buying their votes.
The current contenders for the leadership are also engaged in an auction for votes, but of a far narrower electorate made up first of fellow Conservative MPs and then the 100,000 or so party members, almost universally old, white, and wealthy. Thus, the initial leadership pitches dominating the news rounds exist in a sort of alternate reality, obsessing on the issue of tax cuts which will mainly favour tory middle classes and corporations while totally divorced from the priorities of the wider public suffering spiralling inflation. A return to traditional fiscal discipline will invariably mean these giveaways will be taken back in the form of punishing spending cuts to the welfare state and frontline public services.
Quite how all this will square with the incumbent Tory mantra of ‘levelling up the country’ remains to be seen. Even under the current regime, the substance has struggled to match the stated ambition with the Resolution Foundation arguing that ‘the scale of change required goes far beyond anything currently being contemplated.’ To simply half the productivity gap between Manchester and London alone, Manchester would need half a million more workers, an 11% increase in its share of graduates and to mobilise tens of billions of pounds in investment from both the public and private sector.
The German example has demonstrated the true scale of a national levelling up programme, with around €2tn (£1.7tn) spent between 1991 to 2014 on rebalancing regional inequalities between east and west after reunification. That averages out at around £71bn per annum and still the job remains incomplete.
In contrast, the most recent spending review earmarked a tiny fraction of that sum for levelling up, with the most significant interventions, the Levelling Up Fund and the Shared Prosperity Fund, totalling just £7.4bn of funding by 2024/25. It is hard to see how any of the candidates would commit further resources to the project, consigning the levelling up agenda to the scrapheap of past vapid tory slogans such as David Cameron’s ‘Big Society’ and George Osbourne’s ‘Northern Powerhouse.’
This of course presupposes that any of the current crop of Tory hopefuls wish to see the country levelled up in any meaningful sense in the first place. In practice at least, it has been the inverse. Take the current strike action in response to the cost-of-living crisis, an issue that will dominate the inbox of any new PM until the next election, and probably beyond.
Indeed, it is one of the few pursuits both the current administration and the leadership contenders appear to share; choosing to level down British workers in the face of demands for wages to keep pace with prices. If anything, any new leader will simply confirm age old suspicions about the supposed compassion of One-Nation Conservatism.
Having talked of ‘taking back control’ after Brexit, supposedly in support of workers outcompeted and displaced by the arrival of low wage labour from Eastern Europe, ministers have now openly supported moves to ban workers from selected key industries from striking while introducing legislation to allow companies to hire agency workers to substitute for staff who strike anywhere else, something even Margaret Thatcher refrained from doing. Instead of setting a higher standard for workers in less organised industries to aspire to, the Tories have chosen to punish those fortunate enough to be protected by strong unions while pitting workers in the state subsidised and private sectors against each other. Nadhim Zahawi and Grant Schapps, both contenders for the leadership, have particular form on this, the former calling potential strikes by teachers demanding above inflation pay increases after years of real term cuts ‘unforgivable’ and the latter the main backer of the anti-union legislation curtailing the right to strike.
Moves to legally constrain strike action have been the usual recourse for many Tory MPs and corporate lobbyists whenever their agenda of spending cuts and weakening workers’ rights have cut too close to the bone, such as when the Coalition came to power in 2010. Many of the MPs now running for leader were either key figures within that government or among its strongest backbench cheerleaders.
The most common justification for pay restraint among the low and moderately paid, avoiding a catastrophic ‘wage-price spiral’ of the 1970s, also demonstrates an elasticity with reality that the characters of George Orwell’s 1984 would wince at.
Given what has predominantly driven prices is not exorbitant wage growth but the global supply chain crisis caused by Covid lockdowns and exacerbated in the energy market by the War in Ukraine, this is not only a myth but also one they don’t appear to believe in themselves. The government has so far refused to release minutes of a meeting, involving both Boris Johnson and then Chancellor now leadership favourite Rishi Sunak, where they discussed lifting the current restraints on bankers’ bonuses above the limit of 200% of base pay. In any case, nor the government or its wannabe leaders have come out against huge rises in executive pay seen across Britain’s biggest companies, where the pay ratio between the median employee to FTSE 100 chief executive pay ratio recently rose to 1:81, up from 1:75 in 2019. They have instead unanimously agreed to cut their taxes now or soon, with the obvious impact this would all have on exacerbating inflationary pressures seemingly a secondary concern.
Whoever the Prime Minister is on September 5th, the political direction of the country is clearer than ever. After two years where the world was turned upside down and government had no choice but to respond with unprecedented interventions, the Conservative Party is determined to ensure that we return to business as usual.
