Under Jeremy Corbyn's leadership, the British Labour Party - equivalent of the U.S. Democratic Party - has moved back to the far-left vision that defined its policies in the 1970s. Rejecting the neo-liberal leadership of its most electorally successful former leader, Tony Blair, Corbyn's Labour Party now supports higher taxes, much higher spending, and a vast nationalization program.
Personally, I believe this vision is utterly idiotic. But that's just me. What's more interesting is what happened this week, when we got an insight into the internal Labour Party tensions over Corbyn's agenda. It came via a debate hosted by Novara Media (a pro-Corbyn media outlet). The debate featured Blair's former top staffer, John McTernan, and Grace Blakeley, an economics analyst for Novara. To McTernan and Blakeley's credit, they were respectful and debated in good humor.
Still, the most interesting takeaway from the debate was just how far ideologically divorced the two sides of the Labour Party have become. One good example of this came when McTernan lamented Corbyn's pursuit of legislation that would require mid-large size companies to give 10 percent of their profits and board seats to their employees. McTernan noted that the 10 percent profit sharing plan is a de facto tax on corporate revenues (which is bad for people and the economy). From my perspective another problem with putting individual employees on a corporate board is that those officials would understandably be more predisposed to increase near-term compensation rather than investing in the company.
Blakeley responded to these points by suggesting that the problem with corporate taxes is that they promote capital flight. That's true. But Blakeley then suggested that the best response to this challenge is not to lower taxes towards greater competitiveness, but to seek global laws that reflect a "need for limits on capital mobility." Blakeley added that she believes a great weakness of the capitalist system is its flexible provision of credit. As I say, the dichotomy between this kind of socialism and Britain's existing neo-liberal economic order is striking. Still, Blakeley and Corbyn's argument has its fair share of hypocrisy. After all, they have no problem with expansive government deficit spending in place of private credit! And that hypocrisy reflects the far-left's utter disdain not simply for a capitalist order that they believe is too unequal, but for the capitalist order per se.
But this is an opportunity for conservatives. Because it offers us ripe ground to talk about how capitalism and not socialism has made lives all around the world much wealthier, much longer, and much happier. Although he's a center-leftist not a conservative, McTernan's criticism of Blakeley was spot on here: he noted that her and Corbyn's ideas would foster a "siege economy." Fortunately British companies are already explaining how privatization benefits consumers more than nationalization.
Ultimately, this was a good debate that rose beyond the normal partisan rancor that now defines western politics. But it was also a debate in which McTernan came out on top. Time will prove as much. Because whether Corbyn fails to enter power or one day leads the British government and inevitably sinks Britain's economy, McTernan's warnings will offer a template for Labour's future political recovery. Anyway, you can watch a video of the debate below.