Ed’s bid to bring back socialism

Are voters becoming disillusioned with Labour's vision of a more socialist Britain? Emily Hohler reports.

"Ed Miliband is as good as his word," says Dominic Lawson in The Sunday Times. When asked, on the eve of the last Labour annual conference, "When will you bring back socialism?", he replied: "That's what we're doing, sir."

Since then, he has "amply justified that retort", first with his pledge to freeze energy prices and last week, with a commitment to cap prices in the rental market.

Miliband's manifesto also includes control of payday lending, intervention in foreign takeovers and the possible re-nationalisation of Britain's railways.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up

At the weekend, a policy document advocating a crackdown on "drinking, smoking and eating junk food" was leaked, forcing Labour to insist it was not official party policy, says Peter Dominiczak in The Daily Telegraph. Each of these proposals has flaws, but "when taken together their real danger becomes clear", says The Times. "Miliband believes it is possible to regulate our way to prosperity."

If people are finding things too expensive or wages too low, he will "use the state to do something about it". But, as history tells us, state control leads to more state control.

Take energy. Since the price charged by energy firms can't be separated from their investment policy, "it is hard to intervene in one area without intervening in the other".

As for wages, a big reason why policies to control incomes usually accompany policies to control prices is that the prices an industry charges are closely linked to what it can afford to pay its workers.

Labour's aim seems to be to "get business to pay for its social policy through the hidden taxation of price control and, perhaps, wage control.Yet, in the end, the cost is still borne by individual consumers and workers, this being a basic principle of tax and regulation policy."

The best way to make the UK prosper is to allow people to trade competitively and to have sensible regulatory regimes.

Miliband is a bit like Gollum in The Lord of the Rings, says Boris Johnson in The Daily Telegraph. He's afraid of the light, and as the sun starts to shine on the UK economy, he seeks out darkness, the bad bits, to draw attention to himself. This is "what we might call Miliband's toadstool strategy to shelter beneath some umbrageous and poisonous fungus and croak whatever Lefty nonsense comes into his head".

Miliband's arguments are popular at first, but theydon't stand up to scrutiny. People realise that if energy prices were frozen, companies wouldn't be able to "invest in the new kit that would enable them to hold down costs".

They can see that rent controls will stop investors from building new houses and expanding the rental sector, and discourage landlords from renting out properties.No wonder the polls continue to narrow.

A weekend poll had the Tories one point ahead in the south of England for the first time since Ed Miliband has been leader. As the economy brightens, "the Miligoblin is losing his last habitat".

Emily Hohler

Emily has extensive experience in the world of journalism. She has worked on MoneyWeek for more than 20 years as a former assistant editor and writer. Emily has previously worked on titles including The Times as a Deputy Features Editor, Commissioning Editor at The Independent Sunday Review, The Daily Telegraph, and she spent three years at women's lifestyle magazine Marie Claire as a features writer for three years, early on in her career. 

On MoneyWeek, Emily’s coverage includes Brexit and global markets such as Russia and China. Aside from her writing, Emily is a Nutritional Therapist and she runs her own business called Root Branch Nutrition in Oxfordshire, where she offers consultations and workshops on nutrition and health.