Lord Frost counters Gove: we need more individualism to grow and prosper

Lord Frost responds to Michael Gove's quest for community

I have every sympathy with the aims Michael Gove sets out in his essay of 3 July. Indeed, no-one sensible on the Right or the Left is going to disagree that in an ideal world we would have a more successful economy, reduced inequality between regions, an end to polarisation and the promotion of group rights, and a “patriotic renewal”. The issue is rather how do we deliver those things - and whether the means suggested are likely to do so. There, I fear that Michael’s essay is all too representative of an establishment worldview which sounds attractive, but which concedes too much to social democracy and statism, and which cannot therefore, in real life, deliver on the aspirations of our voters. 

His argument is underpinned by three propositions, all of which I fear are incorrect.

First, Michael argues that “underlying all the problems and challenges we face today is a quest for community”. This seems to me suspect. Is the Ukraine war, and the need to spend properly on defence as a result, the result of a “quest for community”? Do we have low productivity and growth, a poorly performing health service, a faltering energy production and distribution system, five million people on out of work benefits, and the highest level of tax and spend for 70 years because our communities are insufficiently strong? No. Indeed, one could, and indeed I would, argue that we have those things precisely because we have too often prioritised social concerns over the economic, favouring pain-free solutions paid for by government rather than difficult choices. As a result, our underlying problem has got worse: we now have an underperforming economy which cannot support the public spending superstructure resting on it, which is growing too slowly, and which is not giving increased living standards to our citizens. 

Second, Michael’s piece does not pass the ideological Turing test, that of correctly characterising his opponents’ views. He criticises the proponents of “right liberalism” or “libertarianism” as favouring “radical individual freedom and self-realisation”, a culture of “dutiless rights” and self-enrichment. But I personally don’t know anyone who holds these views - in the Conservative Party anyway, though they could perhaps be considered to characterise the outer fringes of the gender and trans rights movement. They certainly aren’t true of free marketeers I know, all of whom are at pains to underline that markets work best within a well-understood legal order and nation-state community. 

Moreover, if Conservatives start to sound like Dave Spart, always denouncing neoliberals and big multinationals, we are just sawing off the branch on which we are sitting – and a flimsy branch it is nowadays. We are just encouraging the strange, yet all too widespread, belief that we have lived through twenty years of wild free markets and neoliberalism, a minimal state in which the poor go to the wall, rather than the reality, which is that we live in a high-spending interventionist social democracy.  

Third, the vision is essentially unpolitical. Michael speaks approvingly of a conservative tradition which is “pragmatic, empirical, rooted in reason and respectful of human nature”. Again, no-one will disagree with that. But I suggest these are not really exclusively conservative virtues. To what purpose do we hold our pragmatism and empiricism? What sort of society are we trying to create with them? There is a certain sort of Conservative who speaks huffily of “ideology”, as if an ideology is some sort of dangerous foreign idea not to be found in the British version of conservatism. Yet an ideology is very important: it guides us in the decisions we take, enables us to paint a picture of the kind of good society to which we aspire, and stops us getting entirely lost about what it is we’re trying to achieve when we’re in government. If we are only about pragmatism and empiricism, communities and institutions, we come close to saying we exist just to hold power, to run the system better than our opponents, but not really to do anything. A lot of Conservatives do think that. But it is not enough.

So, I would argue that a Conservatism which is capable of persuading voters nowadays cannot only be about rural idylls and gentle density, about stability and community, important as all those things are. It must also be about maintaining an economy in Britain which is growing and making people richer, and hence a political economy which promotes and sustains this nation of the United Kingdom while at the same time ensuring we can deal with the change and churn necessary to generate prosperity. And it must ensure that we are always seeking to create and support self-reliant individuals, capable of action and resilient to setbacks, not people who depend on government support in every area of their lives and falter without it. Successful and prosperous individuals are the basis for a successful country and an effective government. The equation does not work the other way round. 

That is a tougher prospectus than the one we have pushed in recent years. But it is necessary. It is necessary because something important, and rather little commented upon, has happened in British politics in the last few years. For the first time since the formation of the Labour Party over a hundred years ago, the better off you are, the more likely you are to support Labour. The Labour Party has become the party of the well-off – particularly, of course, of the governing classes, the public sector nomenklatura, the university lecturers, the civil servants, the lawyers, but also increasingly of parts of multinational business and the City, and not just the HR directors and the sustainability coordinators. Broadly it is the party of those who liked the pre-2016 settlement and didn’t want it to change. The reverse is true of Conservative voters - and this, of course, is what is meant by the realignment, the incipient 2017 and completed 2019 coalitions that changed the focus of Conservatism.

Those who voted for the Conservative Party in 2019 were to a large extent those who voted Leave in 2016. Self-evidently, they wanted change. They wanted things to be shaken up and the country to be different - not only geographically, where Michael is right to point to levelling up as a key political cause, but also politically and economically. In this, of course, they are not alone. The young, those paying off student debt or despairing of buying a house, also wanted economic change, but drew a different conclusion: not Conservatism, but Corbyn. Corbynism has failed them. Conservatism should not be doing the same but trying to appeal to them and tapping into the spirit of change. Whether you are white van man frustrated by IR35 and ULEZ, or the impoverished university graduate living in a crumbling shared house, you both want things to be different.

That is why the Conservative Party has no choice but tap into that spirit of change if it wants to build durable coalitions to win. That is the logic of Brexit and the 2019 election victory. It has to win by delivering better outcomes for those who want better lives. And we know how that is done: it is by releasing the power of the market, of experimentation and of ideas, of allowing individuals to have more choice over their own lives and money, and more power to create and accumulate wealth to give them economic security. If that is seeing “citizens as consumers”, then I’m all for it. Choose freedom.

I’m afraid this is fundamentally different to the vision in Michael’s essay. Too many people in the Conservative Party seem to have come to believe that Hayek is wrong, that knowledge in the market is not decentralised and collectively unobtainable, and that it is perfectly possible to run an active state big government economy as long as sensible Conservatives are directing it. It is a fallacy, it has been proven to be a fallacy everywhere it has been tried, yet the temptation always remains. The means may differ, but the aims are the same. Yes, we may reject the 1970s’ vision of funnelling subsidies to disadvantaged areas, but the outcomes will be different if we just do the same thing by regulation and direction. In this vision, the state knows best how to “put capital to work”, what kind of production to invest in, how to join up domestic supply chains, what sort of skills the economy needs, how to “ensure R&D investment can secure a return everywhere”, and much more. But does anyone think the British state we actually have, in London or devolved, is capable of doing any such thing - particularly if it is trying to achieve all these things without disrupting communities, in a spirt of empiricism and pragmatism? The much more likely outcome is the one we have now: an undynamic economy, growing slowly or not at all, in which social conflict and group rights become more marked not less, as everyone sees advantage in getting themselves designated as part of a disadvantaged minority and everyone struggles for a bigger share of a fixed cake.  

There is only one way we are going to deliver the changed country our voters, actual and potential, rightly need. Get tax and spend down. Get taxes down even further in disadvantaged areas and create more investment zones and freeports. Get the cost of living down by ending unproductive green subsidies. Start tackling the massive waste of everyone’s resources in the NHS. End high levels of migration so there is a private interest in investing in skills. And seriously reform planning and build more houses, including on the green belt - and much, much more. 

There’s no way round this. We can have state-directed stagnation, or we can have a new economy that actually grows and gives people economic power over their own lives. Faced with that choice, there is only one that our country can make. The sooner we face up to it, and get on with it, the better.

Lord Frost was Chief Negotiator for exiting the European Union and then a Cabinet minister under the Boris Johnson government from 2019 to 2021. A former diplomat, he was appointed to the House of Lords in 2020.