It is all too easy to confuse wealth creation with wealth itself. As Conservatives we must be staunch defenders of wealth creation, although this does not mean we should automatically defend inherited privilege and unearned wealth.
Like many of my fellow Conservative colleagues, I am becoming increasingly alarmed at the level of anti-business rhetoric emanating not just from the media, but from too many other MPs. In times of austerity we must be especially careful not to be drawn into the left-wing trap of lambasting successful business owners, leaders and entrepreneurs with the divisive and flawed politics of envy.
We all want to see the jobs created and incomes generated that will lift us out of the current economic mess. The last government left our country on the brink of bankruptcy with the biggest debt and deficit in our peacetime history. We cannot repair the damage by striking out at those people who are in a position to put things right. The question is how to get those people with the money, and an appetite for risk and hard work, to invest their cash and effort into UK businesses.
The media narrative often underpins the politics of envy by suggesting that high rewards for entrepreneurs and profitable businesses are part of the problem rather than part of the solution. But we must celebrate profits made in Britain. The bigger the profits made, the louder the cheer should be. These profits are invested to create new jobs, paid in taxes to subsidize the rest of society and returned as dividends to pensioners through their pension funds.
Financiers, bankers, private equity investors and hedge fund managers can supply the money-flows needed to revitalize UK businesses. If they are encouraged to operate in an appropriately regulated and competitive market, these are the very people with the resources on hand to instantly boost investment and economic growth. So it is doubly disappointing when some of our political class continue to fall prey to the same lazy narrative, which excuses government failure to set the right regulatory framework, and persists with the mantra that rewards for success are somehow morally questionable.
If we want to reduce income tax for low and middle income earners and provide decent public services for the least able, we must encourage business investment. Small and medium sized businesses provide 59% of our private sector jobs. They also pay 53% of business taxes. We should be urging rewards for success and we must value those highly profitable businesses that are, self-evidently, doing things well. On the flip side, if we are to get value-for-money from our public services we must spend taxpayers’ money wisely. We must be more than willing to employ the expertise of effective consultants, rather than stereotype them as a group of scoundrels on the make.
Underlying these negative attitudes to wealth creators is a dangerous tendency to “groupism”. The public is often led to believe that all bankers are to blame for the financial crisis, although the vast majority played by the rules; profitable businesses are selfish, even though they create jobs and pay the taxes we need; and consultants are parasites, when they are employed in improving public services and saving taxpayers’ money.
As Conservatives we must call time on these divisive and self-defeating attitudes. The 2012 Budget went some way to ensuring that Britain is open for business, but we must go further in openly welcoming the energy, determination and drive demonstrated by our private business culture, so that overseas investors will not be deterred.
I look forward to the day when we live in a Britain where our political leaders unashamedly welcome aspiration and applaud big profits and rewards for success. Thriving and vibrant British businesses are the only way for us to emerge from our dire economic circumstances. We must be unapologetic in saying so. It may be unfashionable to value the work of wealth creators, it is better than the alternative of mass unemployment and soaring taxes for low and middle income families.