Most of us instinctively think of the Tories as the party that promotes capitalists' interests. But is this true?
In the day job, I point out that fiscal austerity, along with Cameron's apparent desire to see a fall in household debt, would both be bad for profits (except under unlikely conditions). This poses the question: if Tory policies threaten to depress profits, how can we say that the Tories are the party of capitalism?
One answer might be that they'd like to be the party of capitalism, but are also the stupid party, and so are incapable of seeing that capitalists' interests require - at least temporarily - a looser fiscal policy.
Another possibility is that they are playing a longer game. They believe that fiscal austerity will weaken workers' bargaining power (pdf) and so permit higher profit margins. But this runs into the objection that if austerity weakens aggregate demand we might have high profit margins but a low output-capital ratio and so a low profit rate - which is not obviously in capitalists' interests.
Yet another answer would be Kalecki's famous one - that governments must renounce activist fiscal policy in order to maintain capitalists' power in the longer-term by ensuring that the economy remains dependent upon business "confidence."
All these answers have a common problem. They render the claim that "the Tories are the party of capitalists" untestable. Pretty much any policy that seems to jeopardize capitalists' near-term interests can be explained away either as stupidity or as being in capitalists' longer-term interests.This poses the question: what evidence would disconfirm the claim that the Tories are the party of capitalism? Unless this can be answered, the claim loses any empirical interest.