Vince Cable today insisted he is the right man to slash red tape despite his reputation as a leftwinger.
In a speech to Cass Business School, the Lib Dem Business Secretary moved to dispel doubts about his suitability to lead the Department for Business Innovation and Skills, saying he was a free trader, a firm believer in open markets and fully in agreement that present levels of bureaucracy are excessive.
However, Cable, whose party was behind the controversial plans to substantially increase capital gains tax, qualified his comments, saying that he believed the market economy had a responsibility “to spread wealth around” and, reaffirming his determination to clamp down on tax avoidance, “not concentrate it at the top or siphon it off to tax havens.”
Continuing, he added: “A [market economy] should be a place where value and reward are transparently linked. I think that it has to be a route to social justice as well as economic efficiency.”
Different approach
Opening the speech with a joke – “well, the first thing you may have noticed is that I am not Peter Mandelson – for one thing, I am a better dancer” – the MP for Twickenham signalled that a very different approach to that of his predecessor was required now that the fiscal stimulus of the last two years was being reined in.
I am a liberal. I am a free trader. I believe in open markets. Anyone who doubts the clarity and consistency of my views should look up my writing on trade policy from the 70s, attacking protectionism
Vince Cable addresses the Cass Business School
“The basic reality is simple: government is no longer in a position to promote growth through fiscal stimulus,” he told the audience. “Private consumers are debt-laden. Growth will have to come from the business sector. It will need to come from trade.
“And of course that means making this country a good place to do business. Where it’s easy to start a business or invest from abroad. Where regulation is proportionate (and there is less of it than now.) Where starting an enterprise or creating a job – even just one job – is genuinely valued by society.”
Cable, a Labour Party member untill joining the SDP in 1982, said there were considerable misconceptions about his views, amplified and distorted by certain sections of the media, he added.
“I sometimes find myself described in the unfriendly press as some kind of socialist,” said Cable. “They should refer back to the Orange Book I co-authored with David Laws six years ago,” he added, referring to the book which promoted market-based solutions to social problems.
“I am a liberal. I am a free trader. I believe in open markets. Anyone who doubts the clarity and consistency of my views should look up my writing on trade policy from the 70s, attacking protectionism.
“I think the WTO is a good thing, not a neoliberal conspiracy, and I will be pushing hard to get the Doha world trade round revived this year and next.”
Cable, who was reported to prefer a Lib-Lab coalition until he belatedly realised the arythmetic rendered it impractical and unwise, insisted there was nothing incongruous about his prominent role in a centrist coalition with the Tories by highlighting his former role as Esso's chief economist. He does not “have a philosophical problem with big business,” he insisted. “I spent years working for one – a big, controversial oil company no less – and I’m proud of the world-class managers and engineers I worked alongside.”
The recalibration of policy positions entailed in the coalition's establishment has inevitably caused many of those involved discomfit. Jeremy Paxman, always one to identify and target a weakness, recently implied that Cable had jettisoned his position on delaying cuts purely to win power. The Business Secretary replied that he'd simply changed his mind based on the eruption of the eurozone crisis and fresh, gloomy advice from the Governor of the Bank of England, Mervyn King.
Fine line
However, Cable has certainly not had a damascene conversion to a hard-right pro-business agenda. He insisted that making Britain “a good place to do business” again sometimes “means standing up to business. Arguing for more competition instead of cosy cartels. Arguing for better protection for consumers from shady practice. Rejecting special pleading.”
The Business Secretary trod the fine line between supporting business’s interests and those of its employees and wider society, saying that “being pro-enterprise, pro-trade and competition doesn’t just mean being the voice of business.”
Evoking the words of free-market philosopher Adam Smith, he illustrated why improving society and promoting free enterprise are not mutually exclusive: “'The interest of the producer ought to be attended to, only so far as it may be necessary for promoting that of the consumer’. And the consumer is all of us.
“Smith – and this is often forgotten – also argued trenchantly that successful capitalism rested on a sense of morality, not on unfettered greed.
“So I see my role as weighing the needs of small businesses and big businesses, sole traders and multinationals, the City and regional manufacturing. The short against the long term. Getting the right balance.”
Cable also reaffirmed his well known feelings about the role played by the banks in the world's recent economic travails. He struck a chord with much of the electorate during the election campaign with populist diatribes against City speculators and huge bonuses awarded to what he labelled “pin-striped Scargills”, the bankers bailed out to the tune of billions by the taxpayer.
