Business realism must find new and resonant voice amid Brexit delusions, writes Jonathan Todd
Both the libertarian right and the Bennite left see their utopias through the kaleidoscope of Britain’s exit from the European Union. They cannot both be right. The damage to the United Kingdom’s trade and fiscal positions that is likely to accompany hard Brexit is weak ground upon which to build the big state that the Bennites seek. Naïve and doctrinaire libertarians are, therefore, more likely to find their utopia waiting for them at the bottom of the Brexit cliff. But – like all utopias – it would not work out.
The realist beat that is supposed to sustain conservative hearts should soundly shun utopian delusions. ‘To be conservative’, wrote philosopher Michael Oakeshott in the same year that Tony Crosland published The Future of Socialism, ‘is to prefer the familiar to the unknown, to prefer the tried to the untried, fact to mystery, the actual to the possible, the limited to the unbounded, the near to the distant, the sufficient to the superabundant, the convenient to the perfect, present laughter to utopian bliss.’
The Conservative and Unionist party is neither conservative nor unionist. It has rejected Oakeshott and, in doing so, imperilled the union, due to Brexit’s rapid reheating of the ‘Irish question’, with the ‘Scottish question’ simmering.
This party is also supposed to be the party of business but is no longer so. Investment is the motor of business; confidence in the future is the driver of investment; uncertainty about the future kills confidence; and Brexit has opened such a wild Pandora’s box of uncertainty that both libertarians and Bennites think that the future belongs to them. And the UK can provide no certainty about the terms upon which we will trade with the rest of the world in little over a year.
You do not need to be an expert in supply chain management to know that such uncertainty will harm business operations and investment. A passing familiarity with the common sense that, we were told, guides conservatism would suffice. Unfortunately, amid the fog of Brexit, sense is less common than it always was, and almost entirely alien to the parliamentary Conservative party.
We are – to paraphrase former chancellor Ken Clarke, whose imperious speech in the House of Commons during the article 50 debate will be remembered down the years – following the rabbit down the hole and emerging in a Wonderland where certain business basics have been forgotten: that it is impossible for the UK to secure better trading terms with continental Europe outside the single market and the customs union; that the UK’s economic fortunes, due to the hard facts of geography, are more bound to our ability to trade successfully with the continent than any other jurisdiction; that cut adrift from the continent we are much less attractive to ruthless trade negotiators seeking to bring their businesses to as many customers as possible, deep-pocketed investors eyeing European-wide operations, and dynamic immigrants keen to make the most of their talents.
These business basics urgently need to be reasserted. There are those, on both right and left, who suggest that only after Brexit, with sober reflection, will the British come to their senses. With sense meaning different things to right and left. Alas, revolution – which is what Brexit is – begets revolution, not considered contemplation.
‘The Tories’ agonies over Brexit,’ recently claimed the Bagehot column in the Economist, ‘not only make it more likely that the next prime minister will be a hard-leftist who blames Britain’s problems on the machinations of international capital. They also make it more likely that the prime minister after that will be a rightist who blames the country’s problems on the machinations of closet Remoaners and Eurocrats.’
Brexit risks spiralling extremism, hardening division, and collapsing trust. This country has not just, in the foolhardy terms of Michael Gove, had enough of experts. It has had enough of business-as-usual business – with the Brexit warnings of Stuart Rose, ex-Marks & Spencer boss and prominent ‘Remain’ advocate, falling on as many deaf ears as almost the entire economist profession. Economists and business leaders are suffering a lack of cut-through; Brexiteers are deaf to Remainers and vice versa; no one trusts one another – except, perhaps, our social media echo chambers, confirming our biases, and accelerating the spirals of extremism and division.
Business helps no one by speaking in forked tongues. Which is what Vauxhall offers when they cut 400 jobs at Ellesmere Port and insist this has nothing to do with Brexit, while also commenting that, ‘the company will be in a position to consider future investments … once [they have] enough visibility on the future trading relationship with the EU.’
Brexit is both a symptom of and contributor to the contemporary crisis of trust that Rachel Botsman explores in her latest book. A new world order is, she argues, emerging: we might have lost faith in institutions and leaders, but millions of people travel in cars with total strangers, exchange digital currencies, or find themselves trusting a bot. Botsman sees this as the age of ‘distributed trust’, a paradigm shift driven by innovative technologies that are rewriting the rules of an all-too-human relationship. Her message is that if we are to benefit from this radical shift, we must understand the mechanics of how trust is built, managed, lost and repaired in the digital age.
Living out values of hard work, honesty, and dependability is crucial to thriving on platforms like Airbnb, TaskRabbit and Uber. ‘Ratings crystallise hard-won reputations,’ writes Gavin Kelly of the Resolution Foundation, ‘they are the passport to future earning power … The more important ratings are to a worker’s prospects, the more tied they are likely to be to the platform where they first got established … Workers, like consumers, need data portability. It should be a guiding regulatory lodestar.’
The EU – in a further illustration that the floor on workers’ rights will be much higher inside, rather than outside, this union – is taking steps to regulate for such portability. Whether we ultimately do leave the EU or not, the UK should move in the same direction. Such regulation will tie the fortunes of freelancers most firmly not to any particular platform but to their ability to deliver upon their values.
The time has come for larger businesses to also be led, and be seen to be led, by their values. The pro-immigration advertising campaign of Jigsaw, the fashion company, is an illustration of what this might entail. It is not just London mayor Sadiq Khan who should be saying that ‘London is open’. If business values, both in bottom-line and corporate responsibility senses, the openness, tolerance and diversity that the EU has helped the UK forge and prosper from, these values should be more boldly woven into business activity.
Typically, we think of politicians being motivated by values and business people by money. But values-driven business makes more commercial sense than ever, while Brexit has placed a heightened premium on political ability to make financial sums add up. Wise politicians know that staying in the single market will help the UK on this front. However, a different reality will only be constructed if, amid an unprecedented era of ‘distributed trust’, trust between business leaders and their workers and consumers can be adequately salvaged for the cautions of leaders to be recognised in a way that they were not during the referendum.
All changed, changed utterly. And, yet, not changed at all. People still want what they have always wanted, what they wanted before the financial crisis of 2007-08, before the jump into the unknown of 23 June 2016, before social media skewed perceptions. Someone to love, somewhere to live, somewhere to work, and something to hope for. They have just recalibrated how they think these things will be brought about and the information that they draw upon to form these judgments. They are, though, sadly mistaken if they continue to believe that life outside the single market will be more hospitable to their aspirations.
Brexit is bigger than those dreams. It is bigger, too, than Theresa May; it consumes her premiership as it did those of Margaret Thatcher, John Major and David Cameron. Brexit is bigger than the Conservative party; this insatiable destruction will come to damage the career prospects not only of Tory prime ministers but Tory members of parliament seeking re-election. It risks being bigger than Britain, leaving us permanently diminished and poorer, unless we quickly change direction. Which requires the successful communication of some long-standing business realities in a very much non-business-as-usual context.
The political prize that rides alongside this communication is to benefit from association with all that the Conservatives have abandoned: reverence for the union, including the Good Friday agreement; veneration for that which is worth conserving, not least a union that has done more for peace and economic advancement than anything preceding it on our benighted continent; and respect for the economic and social contribution of business, without which we would never have the employment, economic growth, and taxation necessary to sustain a 21st century state, whether Bennite or more socially democratic both in its cognisance of government, as well as market, failure and fiscal realism.
Jonathan Todd is a contributing editor of Progress and works as chief economist at BOP Consulting. He tweets at @Jonathan_Todd
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