Many businesspeople will have paid little attention to this week’s Labour conference, or viewed the various speeches with a sense of detached bemusement. Labour’s pledge to ban fracking? Their promise to raise the minimum wage to £10? Surely things like this will never happen because Corbyn’s Labour will never get elected? Perhaps businesses should worry purely about what the government is doing.
At one level, that is true. It is what the government says and does that really matters. They are in control of the entire political agenda. But Labour’s demise will still have serious implications for businesses – and not in the way they might think.
In trying to anticipate political action, businesses need to put themselves in the shoes of government and party strategists. In doing so, they need to think about public opinion above everything else.
Corbyn’s Labour are fast losing votes to Ukip in their Northern heartlands. Older, hard-working Labour voters want “fair taxes” and high levels of public spending, but they also want border control, basic patriotism and a welfare system that rewards hard work. Labour are not interested in these cultural issues, while Ukip offers the lot – which explains their rise.
But Tory strategists will believe this fracturing of Labour support – and the shift in voting towards small-c conservatives – offers them hope to break into the North properly for the first time in a generation.
Tories know, of course, that they have been locked out for good reason. The deregulation of the economy in the 1980s and 1990s was necessary but it was painful and many parts of the North of England, as well as Scotland and Wales, suffered badly. They will therefore be thinking hard about the sorts of economic policies that will attract Labour voters or make them think that the Tories have changed – along with the sort of cultural policies that Ukip offers.
Strange as it might seem, the decline of Labour might therefore end up dragging the Tories to the left, as they go after Northern votes. I have written in City A.M. before about what a more interventionist industrial strategy might look like, with the prospect of more spending on infrastructure and education, and tax breaks for startups and businesses that might relocate to less economically developed areas.
But on a national level, the Tories must surely be thinking about policies that might play a similar role in changing the way hostile areas think about them. Whether any of these come to fruition is open to question, but you can be sure that political strategists will be looking at policies that might worry businesses: an even higher minimum wage; higher personal taxes on the very top earners; a further crackdown on corporate tax planning; greater protection for part-time workers; more guarantees on pension rights; and more rights in the workplace generally.
Those that doubt a Tory government would push ahead with any vaguely similar agenda should ask themselves a simple question: what matters more, political purity or political power? For most political strategists and politicians, that is not even a serious question. When it comes to it, the Tories will do what it takes to steal Labour votes and to destroy the party as we know it.