Friday 22 November 2019 6:00 am

This election is a battle Labour does not deserve to win

In 2004, the US chat show host Oprah Winfrey gave away a brand new car to each member of her studio audience. It was badged as an act of unparalleled generosity — though, as is the way of these things, the reality was more complicated.

Gift taxes hit recipients hard — and the cars themselves were given away not by the talk show host, but by Pontiac.

Read more: City urges rethink over Labour’s ‘hostile’ manifesto

Voters in the UK should learn the lesson of Oprah’s audience: if something seems too good to be true, it probably is.

Labour’s manifesto is the most radical document put to an electorate in Britain’s modern political history.

Its promises are eye-catching as well as eye-watering. Free broadband, cheap utilities, lower rent, less work, more pay, higher pensions, free education and jobs for all.

Jeremy Corbyn calls this “investment on a scale you’ve never seen before”. We call it socialism — and it fails wherever it rears its head.

Like the studio giveaway, the small print reveals the problem, and in this case it isn’t an amusing postscript but an economic programme that would be utterly ruinous. Most of Corbyn’s policies announced in yesterday’s manifesto are popular.

If asked whether you’d like better and cheaper goods and services, people tend to say yes. It is now down to the Tories, and all those who refuse to be beguiled by this largesse, to explain why the cumulative impact of Labour’s ideas would undermine our economic foundations and imperil the futures of the very people they wish to help.

The Tories will not campaign in defence of traders hit by a financial transactions tax and Boris will not begin his manifesto speech by defending investors in startups which, under Corbyn’s plans, would be pummeled by radically higher capital gains tax.

But it is beyond doubt that Labour’s regulatory burdens, asset seizures and corporate taxes would have a detrimental effect on the City’s attractiveness and competitiveness — and that will have an impact on the wider economy.

Labour’s plan is for higher taxes, stultifying state control, open hostility to employers and a borrowing binge. This is not how successful economies are run.

Corbyn revels in division; he rails against fat cats, greedy landlords, billionaires, bad bosses and the press.

Read more: John McDonnell defends Labour’s election tax plans

It is now time for the Tories to define their own dividing lines: making a clear case for how they would facilitate a dynamic, equitable and growing economy, not the command and control socialism presented yesterday.

The stakes are high and the battle is only going to intensify. It is a battle that Labour deserves to lose.

Main image: Getty

City A.M.'s opinion pages are a place for thought-provoking views and debate. These views are not necessarily shared by City A.M.