Labour leader Jeremy Corbyn's and shadow chancellor John McDonnell's socialist policies ignore economic success story - The City View

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This week we saw the elevation of radical Marxist John McDonnell to the office of shadow chancellor (Source: Getty)

This has been a week of baffling contradictions.

On the one hand, we learnt that wage growth is at its highest since 2009 (at 2.9 per cent) and that the employment rate is at a record high.

On the other, we saw the elevation of radical Marxist John McDonnell to the office of shadow chancellor, promising to make the case for a wave of nationalisations and job-destroying tax hikes.

Read more: Yes, John McDonnell is a joke – but the threat he poses is all too real

What ailment has Labour identified for which the treatment must be unbridled socialism?

Unemployment in the UK is down to 5.5 per cent (the lowest rate since 2008) and there are 43,000 more 18 to 24 year olds in work compared with this time last year.

Around 167,000 more women have moved into full-time work over same period.

Things are, in short, going rather well. And yet a new wave of activists are determined to reopen old wounds, fight old battles, relaunch old campaigns and dress the whole circus up in the language of “the new politics”.

There is nothing new about it, but there will still be elements of Corbynomics that attract popular support.

Read more: Labour leader's statist worldview is public enemy number one

A minimum wage of £10 per hour, money for housing instead of bank bailouts, price caps and jobs for all: There will be plenty of members of the average Question Time audience who will lap this up.

That’s why the Prime Minister was right to say yesterday that the arguments against this kind of economic populism need to be made again.

Let us hope that a new generation of free-market advocates are prepared to heed his call.

When Corbyn talks about printing money to spend on infrastructure, the inflationary dangers of the policy must be made clear.

When he talks about raising corporate tax rates, the ongoing importance of attracting investment must be spelt out.

Corbyn successfully dragged the terms of the Labour leadership debate to the left, and the risk is that he will now do the same with the national conversation.

While there is very little evidence to suggest that the current Labour agenda will prove to be electorally successful, it will be loud and prominent and hard to ignore.

The only meaningful response will be for those who understand the benefits of economic liberty to stand up and make the case afresh.

It’s as important now as it was in the 70s and 80s.

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