Red Ed's Back With a Vengeance

After more than an hour of listening to Ed Miliband we now know the answer to the big question. Just what would he do if he became Prime Minister? Would he tackle the deficit with the iron discipline he's previously promised? Would he ensure Britain is well placed to win the global race? In short, no. But he will keep his shirt on whilst on holiday, so that's alright then.

After more than an hour of listening to Ed Miliband we now know the answer to the big question. Just what would he do if he became Prime Minister?

Would he tackle the deficit with the iron discipline he's previously promised?

Would he ensure Britain is well placed to win the global race?

Would he really help hard working people by keeping interest rates and mortgage payments down?

In short, no. But he will keep his shirt on whilst on holiday, so that's alright then.

In his speech on Tuesday Miliband cemented his role as Red Ed by performing a revival of the socialist classics; no real mention of the need to control spending (just 54 words out of 7,000), policies that show no understanding of business, the introduction of price controls, and an end to property rights.

On business rates - there's no doubt that some businesses are struggling with rates. That's why this government extended small business rate relief for the last three years, helping more than 500,000 business and taking a third of a million businesses out of paying rates all together.

But Miliband's plan to increase corporation tax on larger firms in order to pay for a rates reduction for the smallest is clearly not the way to go about helping our recovery.

On hearing about it this morning the IoD said that "It's a dangerous move for Labour to risk our business-friendly environment in this way". Why? Because the staged reduction in corporation tax announced by the Chancellor, sets an important direction of travel and confirms that we are open for business. It encourages businesses to relocate to the UK and ensures those that are already here, stay here, hiring new staff and contributing to the exchequer.

As always with a headline grabbing policy the devil is in the detail. In the case of this policy the devil appears to be that many high growth small and medium sized companies will be caught in paying extra corporation tax. Those companies earning a profit of £300,000 or more may sound large, but in reality they're not. This won't be a tax on mega corporations to pay for micro businesses, it will be a tax on job creators and high growth companies. The British Chamber of Commerce probably put it best when they said: "Labour must realise that you can't rob Peter to pay Paul."

In terms of business policy though, perhaps most worrying for me was Miliband's critique of the Global Race. Criticising the Government's language may have made for a catchy bit of call and response and a pithy one liner, but Miliband's suggestion that deep down he doesn't believe that we're in a global race is deeply worrying for the future of our country. Coupled with their position on Syria this suggests to me that Red Ed believes more in isolationism and retrenchment than Britain taking it's rightful place at the centre of the world's economy.

Then there's the other headline chasing announcement of a freeze in energy bills. A wonderful sounding policy, with no detail behind it at all. How will it be paid for, how will they force it to happen, and what does it mean for investment in our energy infrastructure are just three of many questions that so far have no answers.

And it's clear that on this subject Labour have failed to do their home work. Immediately after the speech Caroline Flint, Shadow Energy Secretary (so someone who should know how this will work), was interviewed by Andrew Neil and not only couldn't explain it, but had no idea what had happened in California when price controls were introduced. Luckily for us, Andrew never asks a question he doesn't know the answer to, so was able to inform her that the result was shortages and blackouts. Why wouldn't that happen here as well?

But for the true socialist Ed's speech had the ultimate policy, the end of property rights.

In Government Labour saw house building fall to it's lowest level since the war, but if we let them back into Number 10 they'll magically build 200,000 new houses a year, apparently by confiscating people's land and presumably giving it to someone else to build on.

Now, I don't disagree that we need to do all we can to get building going on stalled sites and land that developers have banked, but this policy isn't how we do it. Last year I suggested a derelict and vacant land levy to solve this issue, but the socialist utopia of Red Ed's Britain doesn't believe in nudging people to do the right thing. In Red Ed's Britain if you disagree with what the state thinks you should do with your land then it simply won't be yours anymore. An "elegant" policy solution to a tricky problem.

So that's Ed's vision for Britain, energy shortages, businesses relocating overseas and the State taking away your property. To paraphrase Ed, I think Britain can do a bit better than that.

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