RUTH SUNDERLAND: Stop Labour’s socialist anti-Santas
Rachel Reeves entered Number 11 Downing Street this summer thanks to an electorate desperate for change.
It is no pleasure to say that she and her boss, Sir Keir Starmer, have squandered much of the goodwill that accompanied them into office.
A lot of energy was put into convincing companies and the city prior to the elections that the economy was in safe hands.
It is now very difficult to find any of those who were so assiduously courted with a good word to say about Labour.
Darren Jones, principal secretary at the Treasury, followed the Chancellor’s example on Friday by whining about how Labor “inherited crumbling public services and crippled the public finances, leaving a £22 billion black hole.”
These socialist anti-Santas are not just annoying, they damage trust, especially when they add divisive rhetoric praising the public sector over wealth-creating private enterprise.
Fun and games: Rachel Reeves and her boss Sir Keir Starmer have squandered much of the goodwill that accompanied them into office
As the CBI reports today, companies expect a sharp decline in turnover as we enter the new year.
The surveys show that the economy is heading for ‘the worst of all worlds’. Bosses expect inflation to rise, accompanied by reduced production and hiring.
The city is in gloom mode following an exodus of companies from the London stock market and a relative lack of new listings. The IPO of French media company Canal+ last week was a rare exception and even that was a flop.
One in three companies in the so-called go-go AIM market for growth companies is at risk of being taken over next year, according to broker Peel Hunt, which foresees a ‘swarm’ of bidders attracted by rock-bottom prices.
Reeves could do something about this by heeding the call to get rid of stamp duty on share transactions. She has played a deaf ear until now and risks taxing the stock market into extinction.
She delivered a terrible budget, but she was able to give us all a late Christmas present by dropping the duty as soon as possible in 2025.
That could help turn the tide of investors, both large and small, choosing to invest their capital in the US rather than Britain.
On that note, Sir Nigel Wilson, the chairman of Canary Wharf, cites some fascinating figures.
In the early 2000s, Footsie telecom giant Vodafone had a market value of $210 billion, which was 40 times more than Apple at $5 billion. In 2024, Apple was valued at $3.7 trillion, which is more than the entire UK economy and 160 times Vodafone at around $23 billion.
Two other US tech stars, Microsoft and Nvidia, have also been valued at about the same level as Britain’s annual output at various points this year.
Sobering. But there is no inherent reason why our economy should lag behind the US; between 1955 and 2005 it performed in line with real wages, GDP per capita and stock returns.
Unfortunately, the recent trend under Reeves and Starmer is unlikely to reverse.
As a former treasurer of the Conservative party, Michael Spencer is not a neutral party. But it is hard to disagree with him when he told the Mail on Sunday that this is by a wide margin the most socialist government the country has had.
Britain is still a great country with some fantastic assets, including our financial services sector, life sciences, creative industries and more.
But the problem with socialists is, as the old saying goes, that sooner or later they run out of other people’s money.
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