Is this election really about Brexit?

Strangely I don’t think it is.  All the big parties are currently heading for the same destination EU-wise.  The Brexit Party won’t be able to change that.  Johnson’s Brexit is no such thing, but few realise.  The issue of Brexit is settled – for now.

Other more traditional left/right issues can come to the fore.

The battle for Brexit can only proceed once the Tories have a majority.   If it’s a big enough majority (but not too big), Conservative no deal rebels might be able to stop Johnson’s botched Withdrawal Agreement and Britain will still stand a chance.  The real Brexit battle must wait til after the election.  Tory rebels and allies inside Labour are our only hope.  Who knows?  If Boris faces a big enough eurosceptic rebel group, he might find it easier to switch to no deal himself.  Before the next chapter in the Brexit battle can commence,  however, first Labour and Lib Dem must be soundly defeated.

John Redwood, a Conservative MP who favours no deal over Boris’ botch up, writes –

The polls and betting suggest the choice is between a Conservative led majority government or a Corbyn Labour led minority government. There is a large divide between what Labour is offering and what the Conservatives propose.

Labour’s approach is  based on  large increases in taxes and borrowing, to finance a large expansion of the state. In particular they want to nationalise large swathes of the utility sector with discounted  compensation to existing owners, and wish to take 10% stakes in quoted companies.

The Conservative approach is likely to be based on the controlled increases in public spending on heath, education and the police they have announced, with some tax cuts to come. I would like to see the 1% of GDP stimulus from this combination that I have been arguing for.

We know from past experience at home and present experience abroad that the Labour high tax high spend high borrowing strategy will miscarry. Taxing the successful, hard working and prudent more will send some of them abroad and others will be less motivated to grow their businesses and create more jobs. Excessive borrowing by the state can crowd out credit for business and for individuals to buy assets for themselves. The Labour leadership have admired some latin American countries like Venezuela in the past for their generous expansion of welfare and state spending, only to see the misery economic collapse creates. Well intentioned socialism often ends up creating shortages in the shops,  a balance of payments and overseas borrowing crisis, and more poverty as businesses pull out and jobs are destroyed.

Conservative and Coalition economic policy since 2010 has stabilised a badly damaged economy and has created conditions for many more jobs including full time and better paid jobs to  be created. Inflation has stayed under good control, productivity has been disappointing and real wage growth like much of the rest of the advanced world weak. Banks are now stronger and debts under better control.

The right things to do  now are to pursue policies that can help lift productivity and therefore real wages at a faster pace, to ease conditions sensibly without alarming international investors.

 

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