The strange death of conservatism

The pattern of politics has changed. In the post-war era, most countries had a “conservative” party in one form or the other, and a “social democratic” party (although sometimes with a communist party on their left). But the conservative parties have now transformed into something new and disturbing.

Broadly speaking, the conservative parties represented the interests of business and the social democratic party campaigned for workers. The conservative parties had different names — Republicans in America, Christian Democrats in continental Europe — but they tended to accept the broad basis of the post-war welfare state.

The emergence of Thatcherism and Reaganism in the 1980s was a change, but not a complete reversal. They believed in lower taxes and less regulation. But they did not dismantle key parts of the welfare state, like the National Health Service (in Britain) or Medicare, Medicaid and Social Security in the US.

What united Thatcher and Reagan was their glorification of businesses and entrepreneurs. These people, the public were told, would create jobs and prosperity if only they were free to do so.

Leap forward to today, however, and there is a clear gap between business and conservatives on some issues. Business is generally in favour of liberal rules on immigration, as it wants to attract both skilled workers from abroad and the low-skilled in areas like agriculture and restaurants where it can be hard to recruit domestic staff. Business wants trade to be as free as possible as it depends on global supply chains in which goods, and their components, are transported across borders many times.

But the modern conservative parties have become hostile to immigration and far less enthusiastic about free trade. In the US protectionism has been a Democrat issue since the 1980s. But the Republicans have sat by while Donald Trump has imposed tariffs on close allies, as well as on China. In Britain, the business lobby has made it very clear that it is opposed to a “hard” or “no deal” Brexit. However, the Conservative party is held hostage by its rightwing ideologues and may end up allowing such an outcome to occur.

Of course, the conservative parties on both sides of the Atlantic are still happy to offer business low-tax and low-regulation policies they crave, and that will be enough for some. But the gap between business and politicians is real. It can be seen in the emergence of “woke capitalism” where companies like Nike and Gillette are targeting their adverts at younger consumers, and the millennials they want to recruit. That puts them at odds with the Republican party.

More fundamentally, conservative parties are no longer very “conservative”. Donald Trump has remade the Republican party in his image and is a disruptive force. In France, Emmanuel Macron came from nowhere to take over the centre-right. And in Britain the government is overthrowing the last 45 years of co-operation with Europe, a policy that the Conservative party itself championed.

This represents a search for votes. Being a pro-business party is no longer sufficiently popular, in the wake of financial crisis; business has not delivered the economic growth voters desire. Radical change looks popular; hence the term “populist”.

But it is a Faustian bargain on both sides. Conservatives have banged on for 30 years about the need to listen to the private sector; now the likes of Boris Johnson are saying “F*** business.” That makes it much harder for conservatives to oppose left-wing demands for higher taxes on the corporate sector. And to the extent that business still funds conservative parties, they may come to regret it. They may get some concessions on regulation but if that comes at the price of complete disruption to their international trading activities, it will not be worth it.

Economist columnist, opinions generally my own, typos always my fault. Author of Paper Promises, The Last Vote and The Money Machine

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