The strange death of the business vote

To those of us who grew up in the 70s and 80s, there’s something odd about politics now. It’s that no main party is, or seems to want to be, the “party of business”.

What I mean is that back then, the Tories were emphatically on the side of business, exemplified by Thatcher’s union-bashing and talk of “management’s right to manage”. In the 90s Labour – first under John Smith and then under Blair – devoted immense effort to trying to get business onside via the prawn cocktail offensive.

Elections then were won and lost by chasing the business vote.

Things have changed. In taking the UK out of the EU against the wishes of most major companies, the Tories can no longer claim to be the party of business. And Theresa May’s talk of getting “tough on irresponsible behaviour in big business” and of “unscrupulous bosses” suggests little desire to become so.

You might think this presents Labour with an open goal. It would be easy to present policies such as a national investment bank, more infrastructure spending and anti-austerity as being pro-business.

But there seems little desire to do this. Why not?

A good reason is that political parties should not be pro-business. Pro-business policies can often protect incumbent firms at the expense of consumers. Governments should instead promote competition, which denies businessmen an easy life and high profits.

What’s more, some “business interests” are in fact a desire for unjustifiable power. Kalecki pointed out back in 1943 that businesses opposed sensible fiscal policy because it made employment less dependent upon business “confidence”, thus removing a source of capitalist power. The point broadens. Some businesses are opposed to worker directors and some employment rights not because they are inefficient but because they undermine their power.  

No political party is, or should be, the party of Mike Ashley or Philip Green.

But there’s something else. Voters chose Brexit despite knowing that it was against the wishes of most major businesses. Brexit wasn’t just a vote against political and intellectual elites, but against business elites too. Perhaps, then – in sharp contrast to the 80s and 90s – being on the side of business is no longer a vote-winner.

In theory, this could be a very good thing, as it might facilitate policies that are pro-market and egalitarian. I fear, instead, though that it might simply lead to a populist pandering to grievances.

Comments

[pablopatito]

"Pro-business policies can often protect incumbent firms at the expense of consumers."

Couldn't that be a good thing when the incumbent firms are foreign? For example, policies to promote British IT companies or British film & television companies may mainly be at the expense of US companies.

[Stuart]

Aren't you conflating business with 'big business'. We can be confident that most small businesses supported Brexit.

[Carol]

Stuart:
"We can be confident that most small businesses supported Brexit."

Please explain with some sort of data.

[Mark]

I think the era of pro-business politicians ended when big business detached itself from SMEs, micro-businesses and even their win shareholders.

Politicians realise that hollowed-out, offshore-domiciled rent-seeking management teams in the banks and multinationals are hated not only by the left but by the vast majority of Tories, whose interests as small business owners and shareholders are served by reining in the egregious behaviour of the megacorps and those that lead them.

[Boursin]

The fact is that there was constantly a plurality for Remain among small business owners.

Federation of Small Businesses poll, September 2015: 47% Remain - 41% Leave

YouGov poll, November 2015: 47% Remain - 42% Leave

TNS poll, May 2016: 38% Remain - 37% Leave

etc.

[BCFG]

I think we could say business was slightly in favour of remain, and the vote went slightly in favour of leave.

The idea that political parties are no longer pro business is an illusion I think. An illusion brought about by the complete victory of pro business friendly policies over the last 30 years.

The unions have been smashed and since the new draconian legislation smashed some more.

So business is living in a pro business environment and political parties do not have to be overtly business friendly, (though contrary to what you say they still are) because they have delivered almost everything business wants!

And where Theresa May is concerned actions will speak louder than words, and given her actions so far I see nothing to suggest any shift in Tory policy that would favour those at the bottom. Of course we will still get the usual guff about hard working families being rewarded.

As I have said before the left should challenge this glorification of 'hard work' and instead point out that most development over the history of humanity has tended to reduce the burden of work, and that those who work hard are probably not the best at finding the most efficient ways of working. A hard working society is a sign of a decline in productivity.

Rather than hard work let the left be the champions of quality work.

[BCFG]

I think we could say business was slightly in favour of remain, and the vote went slightly in favour of leave.

The idea that political parties are no longer pro business is an illusion I think. An illusion brought about by the complete victory of pro business friendly policies over the last 30 years.

The unions have been smashed and since the new draconian legislation smashed some more.

So business is living in a pro business environment and political parties do not have to be overtly business friendly, (though contrary to what you say they still are) because they have delivered almost everything business wants!

And where Theresa May is concerned actions will speak louder than words, and given her actions so far I see nothing to suggest any shift in Tory policy that would favour those at the bottom. Of course we will still get the usual guff about hard working families being rewarded.

As I have said before the left should challenge this glorification of 'hard work' and instead point out that most development over the history of humanity has tended to reduce the burden of work, and that those who work hard are probably not the best at finding the most efficient ways of working. A hard working society is a sign of a decline in productivity.

Rather than hard work let the left be the champions of quality work.

[B.L. Zebub]

@Chris

"Things have changed."

I am not sure that is as straightforward as you believe.

Take the Brexit referendum for example: one could say the Tory mainstream opposed it, even if they didn't say so, because they were pandering to the "business vote".

At any rate, much more important is this: why, do you think, have things changed?

[chris]

@ BCFG - Yes, the general environment is pro-business. My point is merely that political parties now no longer feel the need to say they are.
@ Mr Zebub, that's a good qn. It might be part of the general populist turn, the long-term effect of stagnant incomes and inequality. It might be an effect of secular stagnation in another way. In the UK now the highest-profile businessmen are not admired entrepreneurs but the likes of Green and Ashley - predators rather than producers. These might have tarnished the reputation of all business people.

[Bonnemort]

"Governments should instead promote competition, which denies businessmen an easy life and high profits."

Instead, we hear from the Economist class

"Governments should instead promote labour competition, which denies workers an easy life and high wages."

[Blissex]

«Instead, we hear from the Economist class

"Governments should instead promote labour competition, which denies workers an easy life and high wages."»

That is very popular with manager and property rentiers small and big.

My most recent "understanding" of neoliberalism is that it is the doctrine that all economics problems can be solved with lower wages and bigger property prices, and therefore both lower wager and bigger property prices are a solution, not a problem.

There are many petty and large rentiers who love neoliberalism.

[Blissex]

«the highest-profile businessmen are not admired entrepreneurs but the likes of Green and Ashley - predators rather than producers. These might have tarnished the reputation of all business people»

I am not so sure that the many rentiers who benefit from lower wages and less secure and harder work for the bottomost 50% of the workforce, such as cheaper gardeners, carers, handymen, couriers, shop assistants look upon Green and Ashley as other than "heroes of wealth creation".

"Zero hour contracts" for example are obviously quite popular with the direct and indirect beneficiaries.

What many in the middle classes think is that people in the bottomost 50% of income are predatory lazy bolshie exploitative parasites and Green and Ashley are doing well to teach them the value of working harder for less money.

[Blissex]

«promote labour competition, which denies workers an easy life and high wages»

As to this, do people who read this high-minded blog really realize how utterly desperate are low-middle wage immigrant and native workers to hang on to their Sports Direct/Amazon/barista "careers"? Some data points:

* A woman delivered a baby in the toilets of Sports Direct to avoid being sacked for poor attendance.

* "baristas" are expected to find their own replacement when sick by asking colleagues to cover, or else they get sacked.

* I live in an area with a lot of eastern european immigrants, and I got from the landlord agent an email advertising (expensive!) insurance that pays the rent in case of illness, to avoid the worry of being thrown out and becoming homeless while sick.

* I have seen several adverts on bus stops and the London underground for "medicines" to suppress symptoms of illness with a caption like "helps you keep your job by working through your illness".

There is always a queue outside of people even more desperate to replace "shirkers" and "troublemakers".

Just in London and surrounding area there are millions of people working in those conditions and hot-bunking beds in bedsits in slum-like properties.

As J Robinson wrote the only thing worse than working in a sweatshop is not working even in a sweatshop.

[Blissex]

«or else they get sacked»

BTW this is quite an inaccurate description of course: "shirkers" and "troublemakers" on zero hour contracts don't get actually sacked, they are just never called again to work.

That has the advantage that they then are not formally unemployed, and this saves time and money to their employer and middle class taxpayers. Everybody wins! :-)

[aragon]

Ha-Joon Chang on pro-business polices.

https://www.theguardian.com/commentisfree/2015/mar/03/pro-business-tax-avoidance-market-rigging

Neoliberalism is business or at least big business run rampant, everyting benefits the rent seeker, or controller of assets.

Privatisation, fiscal austerity, de-regulation, free-trade, reductions in government spending.
(Mass immigration to reduce labour rates etc).

The result stagnant and falling wages and loss of worker protection, yes to the point that immigrants hot-bedding, have the advantage over locals, who require high standards of housing (requiring more rent or mortgages) and might have dependents in the UK.

My solution to zero hour contracts: Double the standard rate, for anyone on a zero hours contracts, if you want flexibility it costs double. Business chooses, fixed contracts or pay double rates for flexibility. Just a thought.

[aragon]

For the record

The argument that Socialism needs to be cold eyed or practical.

No socialism needs to take back the ground, it has conceded to neo-liberalism, we need fundamental change not cosmetic tweaks. And that is cold eyed and practical.

[Metatone]

Brexit largely backed by a small coterie of extremely wealth donors. Banks, the hedgie who bankrolled Gove etc. But those donors now so wealthy that they matter more than the large swathe of business.

Of course, the other reality is that Brexit camp dominated by utopian freetraders. Expect Liam Fox's deals to be heavily in favour of US corporations, etc.