Over on the website of the Financial Times, director of the liberal Centre Forum think-tank, Julian Astle, argues in his response to the budget that the route to medium- to long-term sustainable economic growth will be the “patient application of liberal economic principles”, not only by the Chancellor but also by the business secretary, Vince Cable.
What does this mean? Julian explains:
This means clearing the way for growth through labour market flexibility, liberalising our overly restrictive planning laws and protecting businesses (particularly small businesses) from unnecessary and burdensome regulation. The chancellor has sought to do exactly this today.
A liberal approach, however, is also about government intervening sparingly to address market failures: to promote investment in low-carbon technologies, to protect investment in high-return infrastructure projects, to nurture science, technology and innovation and to raise the skills base. Again, the chancellor made several welcome announcements – on a single carbon floor price, the Green Investment Bank, on science funding, technical colleges and apprenticeships – but their benefits will only become apparent in 2020, not 2011.
The danger comes when the coalition allows populism to trump its liberalism. It has done this, for instance, by imposing an unwise, arbitrary cap on immigration. Liberal Democrats have won important behind-the-scenes battles to mitigate its effects (such as the decision not to scrap the post-study work routes for foreign graduates) but those victories only go to underline the main point: that in pursuit of growth, the coalition’s best ideas are its liberal ideas.
You can read Julian’s whole article here (registration required).
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5 Comments
I have to admit I do not like some of the things that are done under the name of liberalism as described in the article. We already have “flexible” Labour markets. Flexible means it is easier to get sacked, which in itself does not seem very liberal to me, quite the reverse. Germany has more rigid employment laws, and for now is performing very well economically. Maybe companies should take more care over who they employ in the first place?
“liberalising our overly restrictive planning laws” means taking powers away from local authorities, which does not fit in well with our supposed belief in localism. If people do not want “restrictive planning laws” they should vote for it.
I tell you what would be a really good idea. Propose these policies at Lib Dem conference and lets see whether we think this is liberal or not!
@Geoffrey Payne
‘Flexible means it is easier to get sacked, which in itself does not seem very liberal to me, quite the reverse. Maybe companies should take more care over who they employ in the first place?’
You’d rather someone never be given the chance to prove themselves in a job than to try, fail, and move on more easily to something different?
Geoffrey Payne – I take it you have not come across Hartz IV?
“Maybe companies should take more care over who they employ in the first place?”
That would make it a lot harder for anyone to get hired in the first place. Especially the young and the long-term unemployed.
Yes, sure, we can make Britain an employers’ paradise by making it easier to hire and fire, scrapping planning restrictions, and cutting back the sort of “onerous bureaucracy” that keeps workers safe and prevents environmental pollution. All these things will help to attract employers to Britain and boost our economy – at the expense of other countries. Other countries, that is, who believe in what the Liberal Democrats used to stand for.