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Liam Fox shows David Cameron how to lead the Tories to a historic defeat

11 March 2013

3:27 PM

11 March 2013

3:27 PM

I think it is fair to say that Dr Liam Fox has never been one of David Cameron’s chief chums. The former Defence Secretary has, as Paul Goodman notes, been closer to George Osborne. Be that as it may, his speech today is a fine reminder of Dr Fox’s political limitations. This is the kind of stuff – and the kind of man, frankly – that helps explain why the Conservative party has not won a general election majority since 1992.

Think on that and think on how much Britain has changed these past 21 years and how little the Tory party has. Dr Fox ignored all this, delivering a call to arms like it was 1981 All Over Again. But it is not. According to Fox, however:

The great socialist coup of the last decade was making wealth an embarrassment. It is not. It is the prize for aspiration and hard-work and its side effects are higher tax revenues, more jobs and more investment.

Oh really? This is – and I apologise for using the technical term here – moronic. But what a way to make it seem as though your party really is more concerned with the troubles of the super-wealthy than with the fate of the middle and aspiring-to-be-middle classes. Is Fox really ignorant of the fact that, in real terms, average earnings have been stagnant for a decade? Is he really unaware that this misfortune has not applied to the wealthiest Britons whose remuneration has increased considerably in real terms and vastly more, relatively speaking, than the pay received by Britons on average or below average earnings.

If this reflects a government-sponsored programme designed to shame the wealthy then, blimey, it is even less effective than most government programmes. I see little embarrassment about wealth on the Tory benches anyway. It’s not the actual toffs who are the problem; it’s the grasping and thrusting self-made Tories who sneer that the rest of the country could be just like them if only they were prepared to bloody work hard enough. This, of course, is meretricious twaddle.  These are the Tories who make Mitt Romney look like a political genius.

Strivers vs shirkers? Give me a break. Most people are neither. Most people don’t want to set up a business of their own. Most people just want a decent job, some security, and the promise that government will try and make things a little easier than they used to be. A square deal for the ordinary bloke, so to speak.

So what does Liam Fox talk about? Inheritance tax and capital gains tax! Heckuva way of showing how “in touch” you are! Perhaps the inheritance tax threshold should be increased. But it is difficult to see how the person benefitting from the inheritance has really earned it. It certainly does not seem to require much “hard work” of the sort praised by Dr Fox. Similarly, I doubt scrapping Capital Gains Tax is the kind of policy liable to prove popular or demonstrate this is a government sympathetic to the struggles of the ordinary man or woman.

I suppose the Prime Minister could take Dr Fox’s advice. Perhaps Mr Cameron fancies leading the Tories to an historic defeat.

I continue to think that cutting the rate of income tax payable by the wealthiest Britons was a dreadful political blunder. Perhaps Mr Osborne agreed with Dr Fox, concluding that the rich had suffered embarrassment enough and needed some tea, sympathy and cheering-up.

I wonder about this, however. Consider two contrasting stories today. Felix Salmon has an excellent post demonstrating that, as best it can be understood by the layman, Goldman Sachs really do give the impression of being a thoroughly untrustworthy bunch of people. They appear to have made millions from ripping off their own clients. Goldman bankers, like other City of London types, are Extremely Important People Whom Britain Cannot Afford to Lose. Perhaps this is true but there is something rather craven about admitting it and something worse about celebrating it. The City, meanwhile, seems pretty unembarrassable.

Contrast this with the story told by my friend Neill Harvey-Smith.

My Dad is 60. He has lived in his home since 1982. When he moved in, there was him, my Mum, me and my two sisters in a three-bedroom semi. Now it’s just him. Most of the neighbouring properties, like so many council houses, have been bought up, and the street looks ten times better than when we were growing up. Dad lives in one of the few properties still controlled by a housing association. He doesn’t have a job. He has cancer.

If Dad were a year older, he would be exempt. But as he is (only!) 60, his disposable weekly income stands to fall from £102 to £69. Of that fall, £28 is the reduction in housing benefit – the bedroom tax – and £5 a reduction in council tax benefit. Remember, I agree with you. The bedroom tax is not a tax. But come and discuss the semantics of transfer payments with my Dad.

Indeed. As he notes, the “bedroom tax” might be justifiable if there were a surplus of one bedroom properties into which tenants might move so as to make more efficient use of the housing stock. But there is no such surplus. Many of the people being nudged to move house will not actually move house.

As Neill intimates, this is going to be a disaster for the government:

The government has promised savings that materialise from people staying, and freed up housing that only materialises by them going. Two thirds of the people affected are disabled.

And they have families and friends too, few of whom will be made more likely to vote Conservative by this measure.

As I say, the bedroom tax and the latest scandal at Goldman Sachs seem unconnected. But it tells you far too much that leading Tories get exercised by one but not the other. Worse still, the Tories have positioned themselves as the party of Goldman Sachs and the party of the Bedroom Tax. That’s a double-whammy of stupidity.

What you choose to talk about sends a message of its own that’s quite independent of the content of your talk. Too many Tories seem hopelessly unaware of this. Perhaps Capital Gains Tax is important but time spent talking about it is time spent sending a message to most voters that you’re not as concerned by the issues that affect them as much as you might be.

Similarly, normal people hear whining about the troubles of being rich and wonder what the hell it is the Conservatives are talking about. This has been a pretty good decade in which to be wealthy. The last Labour government were a pretty ineffectual group of class warriors and their replacement by Mr Osborne and Co has not introduced any more rain into the lives of the super-wealthy.

Perhaps Dr Fox thinks such concerns are childish or wimpy. But the contrast between the present mean-spirited Tory traditionalists and more radical conservatives of the past is stark. A little more Teddy Roosevelt might go some way towards helping the party reconnect on economic matters.

Instead we get this tripe about how tough it is to be unusually wealthy. That’s a great way to ensure Ed Miliband becomes Prime Minister. Worse still, the hapless Mr Miliband won’t even need to have earned the keys.



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