The Bear’s Lair: British Tories revert to bad habits

Since the time of Sir Robert Peel (Prime Minister 1834-35, 1841-46) the British Conservative party has been notorious for its inability to conserve anything worthwhile, let alone to restore anything that its opponents had dismantled. For a few years in the 1980s, it appeared that Margaret Thatcher, while imperfect on several issues, had reversed this tendency, and was making Britain a country in which a free market conservative might reasonably want to live. Alas, her ouster in 1990 led to a rapid reversal of many of her policies, and the recent Conservative governments since 2010 have followed the traditions of the Quisling 1945-75 period rather than those of Thatcher herself.

It is not quite fair to blame all “Conservative” governments for destroying the interests of their supporters. Even Peel’s administration of 1841-46 introduced the Income Tax, a balancing of the tax system that ensured that financial capitalists paid their fair share of taxes, before destroying its voter base with the Repeal of the Corn Laws. Disraeli’s governments had little to recommend them – his urban-oriented Second Reform Bill of 1867 did not give Conservatives even a short-term electoral advantage, while his economic state socialism, taking the new industries of telegraph, telephones, tramways and electric power into state or municipal administration, ensured that state ineptitude would transform these emerging growth industries into nationalized dinosaurs.

However, Salisbury’s Third Reform Bill of 1884, negotiated with the Gladstone government to enfranchise the agricultural laborers who had been so cruelly treated by the Corn Laws abolition, finally restored the Constitutional balance between the parties that had been disrupted by the Whigs’ 1832 gerrymander. Then his governments of 1885, 1886-92 and 1895-1902 were in domestic and foreign policy a huge improvement on what had gone before. Alas, their jingoism and colonial adventurism led to Britain becoming overextended militarily, while Salisbury’s failure to introduce an “Imperial Preference” tariff, after steep tariffs elsewhere had made the Peel/Gladstone free trade dream a self-destructive nightmare, condemned Britain to long-term economic decline.

After 1900 the Conservative party’s performance got worse, rather than better with one notable exception. Joseph Chamberlain in 1903 finally convinced the party that a system of Imperial Preference was needed, but the ineffable Arthur Balfour blocked the initiative and then handed power over to the Liberals for more than a decade. Stanley Baldwin mishandled the tariff issue again in the 1920s, and it was only in 1932 that Neville Chamberlain, probably the best Conservative party leader of the 20th century, signed the Ottawa Imperial Preference tariff agreements and ushered in half a decade of unprecedented growth and prosperity – alas, to run into the brick wall of World War II.

World War II and the Clement Attlee Labor government had the inevitable effect of bloating the public sector and raising tax rates to extortionate levels of over 90%. When the Conservatives returned to power in 1951, they could have set the economy free, abolishing exchange controls, escaping from the hugely damaging exchange rate and tariff restrictions that had been forced on Britain by Maynard Keynes at the 1944 Bretton Woods Conference, and bringing top rates of tax down to less confiscatory levels. They did none of these things, missing out on the “ROBOT” floating exchange rate scheme in 1952, for example, The archetypal statesman of the period was Harold Macmillan, a man described by his devoted nanny as a “dangerous Pink” who in 1938 had recommended abolishing the Stock Exchange. Edward Heath’s 1970 government promised much, but its delivery was even worse, as it imposed price controls, over-expanded the money supply and caved in to the miners. As of 1975, Britain’s future appeared one of irretrievable decline.

Margaret Thatcher’s 11 years in office appeared to offer a reversal of this decline, but in the event the policy reversal she led was both partial and temporary. No historian, she anchored her policies to the William Gladstone who had been the hero of her Liberal father rather than to the solider foundation of the 1760-1830 Tory governments whose policies brought the Industrial Revolution. Her “reform” of the City of London, for example, was in the circumstances an unconditional surrender to Wall Street’s ugly behemoths, destroying an independent British merchant bank business that had flourished to the immense benefit of the British economy for at least 200 years. (You can date its inception squarely to Barings’ financing of the American War in 1782, but there is also a case to be made that the first merchant bank was the Hollow Sword Blade Company, which appears to have provided the venture capital for Thomas Newcomen’s “Atmospheric Engine” in 1715.)

Since Thatcher left in 1990, the Conservative party has echoed with feeble promises to stick to her much better governance, but those promises have been belied by the party’s actions. Taxes have been raised, again and again, both at an individual and a corporate level, while the Bank of England has held interest rates artificially low, a policy so un-Tory it most resembles the old Soviet GOSPLAN. Even given the fabulous opportunity of the 2016 Brexit vote, which promised to liberate Britain once and for all from the deadening socialism of the EU, successive Tory leaders have bottled the opportunity.

We should not have expected better from the feeble leftist Theresa May, so most blame should go to Boris Johnson, who managed to win the essential 2019 General Election, then prevented the economic surge that should have followed with an idiotic commitment to the Marxist folly of “net zero,” a two-year diversion into draconian and unnecessary Covid restrictions, and an orgy of public spending on such follies as the HS2 train, the world’s least viable infrastructure project.

It is however in immigration that the Conservative betrayal of its supporters has been most egregious and its damage to the long-term well-being of the British people most extreme. The United Kingdom, already very overcrowded at its 1950 population of 50.2 million (at which time it had innumerable “safety valve” colonization possibilities in the Dominions, where colonists could remain among a predominantly British population) has allowed its population to increase to nearly 70 million, with the increase accelerating since 2000. Even the legal portion of this increase, by bringing lower-wage workers into the British market, has depressed the living standards of the domestic population, so that today Britain, which in 1950 had the highest living standards in Europe, now has a GDP per capita below the EU average, despite having had until recently lower taxes and fewer regulations than the economically flaccid EU norm.

It is fair to blame the explosion of illegal immigration since 2000 partly on the Tony Blair government, signing up to foreign wokie treaties and courts that made it difficult to expel the unwanted immigrants. However, Conservatives have had almost 13 years to remedy these problems, promising continually to do so, and have completely failed. As a result, the majority of the British population have had a diversity imposed upon them that they did not want. Now, if the Scottish National Party elects its front-runner as leader and Scotland votes for independence, even those intrepid Scots with tartan kilts and no underwear will simply replace a squishy Indian prime minister by a Marxist Pakistani one, surely not the dream of William Wallace!

One can dream, but no more than that, of the Conservative party replacing its utterly unsatisfactory post-1830 leaders with the nonpareil leadership shown by Granville Leveson-Gower, William Pitt and Robert Banks Jenkinson in the 1760-1830 period, that led Britain to global domination in prosperity, innovation and geopolitical power. There is no reason to believe such a transformation impossible; the Reform Act of 1832 did not liquidate intelligent Tories, it merely gerrymandered them out of power. If Conservative Campaign Headquarters has its power over selection of MPs stripped, then the 650 constituency associations can each select their local MPs, as was the system before 1871, and with the barriers against non-woke Conservatives removed, some of them will select candidates that are both top quality and truly original minds (such people get blocked by CCHQ under the current system, and therefore often do not enter politics at all.) With a much better quality of MP, the chance of electing a truly capable leader from among those MPs would be far higher. At the very least, the disasters of future John Majors and Theresa Mays would be eliminated.

In summary, the squishiness and left-deviationism that has been such a feature of post-2010 Conservative governments is not new, it is merely a return to a long and dishonorable tradition that now stretches back nearly 200 years. As a Conservative, I like tradition – but there are limits!


(The Bear’s Lair is a weekly column that is intended to appear each Monday, an appropriately gloomy day of the week. Its rationale is that the proportion of “sell” recommendations put out by Wall Street houses remains far below that of “buy” recommendations. Accordingly, investors have an excess of positive information and very little negative information. The column thus takes the ursine view of life and the market, in the hope that it may be usefully different from what investors see elsewhere.)