Previous articles have challenged some views prevalent among our ex-Tory members on matters economic, arguing that in our battle for improvements we need to give the state a greater role, as we would in any other national crisis (which we are in, albeit long drawn-out) and not simply rely on ‘the markets’: they have not been delivering. We need to drop the pretence that ‘libertarianism’ is not primarily code for free-market ideology, and realise working people will not vote for it once they understand what it means – they stagnate, the rich get richer. We need to embrace the progressive principle for direct taxation, drastically reduce our absurdly voluminous tax code and enforce it properly. We also need to do a lot more to support industries struggling against imports based on the cheapest of labour. With these principles we can build an economic policy designed to get us away from Tory orthodoxy and on to a more realistic footing. Liberal economics has failed, and not just because of its ‘heirling’, globalisation. We must now do whatever is necessary, both to win the vote and to start improving our nation’s prospects.
If the Government has been hitting the reverse gear on Osbornian policies, with Mr Hammond’s autumn statement and now Mrs May’s conversion to intervention (not that she will do very much, as usual) our own UKIP Thatcherites should acknowledge this will put us on even more of a limb – which will be sawn off before we know it. There is no future for us trying to out-Tory Toryism. Mr Balls was essentially right. With global interest rates at historic lows and likely to stay that way, we should be borrowing to invest in our infrastructure and improve our skills and productivity.
And increase the annual deficit and accumulated national debt even more?! Yes. The debt is now so high at upwards of £2 trillion that a bit more hardly makes any difference, whilst we would start to make serious inroads on both if we got a grip on household debt and the perpetual bubble that is the UK housing market, and got manufacturing going again. We are all for reducing the national debt, but we should take a longer view than Mr Osborne, who signally failed his targets anyway. What sort of a country is it that closes its public libraries, or will not look after its old people properly? ‘Austerity’ is just another Tory con! They like to accuse UKIP of wanting to return to the 1950s, when in terms of the proportion of state spend their plans would have us go back to the 1930s. Their obsession is to ‘roll back the state’, because that is the sine qua non of free-market economics. If we want to rely on the French and Chinese to build our nuclear power stations, keep voting Tory. Britain can do better than that. There is plenty of money in this country, plenty of skilled and willing hands. We just need to organise them, and start, in this year of revolutions, to think and do things differently.
On trade, we should seek free trade agreements with our friends but not shirk the need for some protection where necessary. There will almost certainly have to be reciprocal tariffs with the EU. With China especially, which takes an elastic view of WTO rules, we should grasp the nettle most strongly. We cannot break the rules but we can opt out where the national interest demands. The aim must be to start repatriating manufacturing jobs in key industries, at least sufficiently to meet domestic demand, to keep our farmers on the land, to re-balance the economy and reduce dependence on our 80% service sector. Banks should be cut to size and the City of London thereafter left to fend for itself, with no more bank bail-outs.
Creation of a national investment bank, possibly based on RBS (still largely owned by the taxpayer) would give businesses large and small the funding they need for capital investment and training, and reduce our dependence on foreign investment, which should be subject to a rule of reciprocity. The wherewithal will come from a patriotic public, major savings from the skewed priorities of previous governments, and a reformed tax system where rates reflect ability to pay, with a total crackdown on avoidance and evasion.
A proper industrial strategy would also rebalance the economy regionally, based on halting population flows to the south-east and restoring prosperity to the rest of the country. The priority for new road and rail would be within the north and not with its connections to the South-East. After decades of incompetence and cowardice, energy infrastructure is an even higher priority: any hard winter in the next few years could see power failures. The main effort should be on nuclear power. The NHS and social care have to be properly funded. Local authorities too must get what they need to deliver essential services, and their funding formulae reformed to give transparency and equality. We must build many more houses, but not on green fields, and take steps to reduce the great pressure on property prices in the south-east, primarily by barring sales within the M25 to non-UK citizens and imposing rent controls, to give our young people access to affordable accommodation. And of course we must reduce demand for housing and services by greatly reducing immigration.
Improvements are not going to come overnight. There would be many difficulties, not least threats from inflation, speculation against the pound, retaliation from trading partners, less availability of foreign-made goods and at higher prices. Other countries will be in the same position, however, and we must look to our friends and the longer term. To survive and prosper we must have, to use a markets term, a major correction. We cannot go on with this dependency culture any longer: we must give our ill-served and long-suffering people some hope.
Do we want to win – or not?