Corbyn's people, circa 1984.

Photographer: Steve Eason/Hulton Archive/Getty Images

Advice for the New Old Left

Clive Crook is a Bloomberg View columnist and writes editorials on economics, finance and politics. He was chief Washington commentator for the Financial Times, a correspondent and editor for the Economist and a senior editor at the Atlantic. He previously served as an official in the British finance ministry and the Government Economic Service.
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Left-wing economics needn't be stupid, says Chris Giles of the Financial Times in a recent column. A left-of-center program could be both practical and coherent. You might still disagree with such a program -- but not because it's economically illiterate or bound to fail on its own terms.

That's the problem with Corbynomics, according to Giles. The policies of Jeremy Corbyn, the old-fashioned socialist on course to be elected leader of the U.K.'s Labour Party, are wrong not because they're left-wing, but because they're delusional. Corbyn assumes "vast untapped pools of free money," says Giles. There aren't enough rich people willing to stay put and pay punitive taxes; they can't be made to pay for all the good things Corbyn wants to do.

So what does Giles suggest? A new left-wing realism, he says, ought to stress two things. First, an assault on "the property rights that most impede prosperity" (notably, planning rules that create an artificial scarcity of land). Second, a forthright commitment, in the Nordic manner, to finance better services and additional redistribution with higher taxes on many middle-class voters as well as on the rich.

Such a program would indeed be more honest and more credible than Corbyn's. However, I wouldn't give much for its electoral chances. Giles himself calls it "possibly not all that popular." That could be a problem: It's better if political platforms are popular.

Perhaps I can help. The left's main problem isn't lack of credibility. Voters already expect their taxes to be higher under left-wing governments than under conservative ones, and the left is unlikely to get much credit merely for confirming this in advance. If anything, the left's main problem is too much credibility. It promises to build a new and better society, and voters are worried that it might actually try. 

The left's real challenge isn't to be more credible but to make its promises a bit more appealing. To that end, I've a suggestion of my own. To be both coherent and electable, the left needs to learn to love -- or at any rate respect -- markets.

You heard me. A modern party of the left doesn't need to be anti-capitalist. Concern for social justice, equality of opportunity and even (up to a point) equality of outcome don't require a belief in the innate wickedness of capitalism. An understanding that markets sometimes fail, requiring cautious regulation or other intervention, doesn't require you to think that profit is wrong. You can grasp the concept of public goods without denying that the market is a phenomenally powerful way to discover what people want and how to supply it at least cost.

You get no sense of this from listening to Jeremy Corbyn -- or, for that matter, Bernie Sanders. In their view, capitalist excesses aren't the exception: They express the system's essential nature. Markets don't require the occasional careful tweak. They need to be dethroned, directed, and in many cases dismantled. That conviction is held with such passion that, for many on today's left, the means matter as much as the ends. Seizing economic control is what counts.

Tony Blair and Bill Clinton both understood the need to detach left-of-center politics from its anti-market, anti-business lineage. They were right not just on the merits but also as a matter of political strategy: They got elected and, in large measure, shifted policy as intended. Today's left in both the U.S. and the U.K. sees those accommodations as betrayals, and is committed to undoing them.

Even what you might call the hard left -- defined in terms of goals rather than methods -- would make more progress if it could only come to terms with markets. For instance, income redistribution on a much larger scale than Blair or Clinton ever contemplated is consistent with a willing dependence on the market mechanism.

Imagine much more generous employment subsidies, even an entitlement to a basic citizen's income, financed from a simple progressive tax system shorn of other deductions and exemptions, together with higher taxes on inheritance. For good measure, add a part-privatized public pension system that gave everybody a stake in rising profits. Such a system could easily be far more egalitarian than the current U.S. tax code -- yet simpler, and in that sense less interventionist and more market-friendly.

A party that follows Giles's advice, saying it's unimpressed with property rights and intent on raising taxes to pay for good works, would leave voters wondering where it will stop. The fatal weakness of today's new old left is that it rarely seems interested in answering that question. If capitalism is evil at the core, why would you stop until you've replaced it with something you think is better?

Most voters do want fairness and compassion, but they don't want unlimited government. For the left to get elected, let alone rule competently, it needs a declaration of limits -- an antidote to the utopianism and hyperactivity to which it is constantly drawn, and that voters rightly find unsettling. Genuine regard for market forces would give the left this crucial limiting principle.

A measured regard for markets, competition, globalization and all their works, however ample the justification, seems too much to ask of Corbyn and his people. But in due course a more electorally purposeful left might manage a plausible impression of respect. That would be better than nothing. Who knows, if they expressed that often enough, they might start to believe it. Then they might begin to draw in centrists like me. At that point, there would be no stopping them.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

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