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  • Andrew O'Brien

The greatest pro-growth policy available is to restore the British constitution

Why did the Industrial Revolution take place in Britain, rather than France or, centuries earlier, in China? This has been one of the great debates in economics over the past fifty years.

Some say that Britain’s advantage goes back to the Black Death and the relatively high cost of labour which encouraged labour-saving innovations and industrialisation. It was better to build your business around machinery and coal, if you could, rather than expensive people. Others say that it was the emergence of Enlightenment ideas, what Joel Mokyr has called the ‘culture of growth’, a belief that we could bend the world to the desires of humanity.

However, the Black Death was not a uniquely British phenomena and the Enlightenment was just as strong (if not stronger according to some) in France or Germany, than it was in Britain. So why here, and not there?

Those who lived through the growing industrialisation of Britain were in no doubt why it took place in Britain. Our constitution.

Writing in the 1750s in his essay Of the Protestant Succession, David Hume was clear that since a “parliamentary establishment” was put into place:

“Public liberty, with internal peace and order, has flourished almost without interruption: Trade and manufacturers, and agriculture, have encreased: The arts, and sciences, and philosophy, have been cultivated…And the glory of the nation has spread itself all over Europe; derived equally from our progress in the arts of peace, and from valour and success in war. So long and so glorious a period no nation almost can boast of: Nor is there another instance in the whole history of mankind, that so many millions of people have, during such a space of time, been held together, in a manner so free, so rational, and so suitable to the dignity of human nature.”

This hyperbolic description of the impact of the Glorious Revolution of 1689 is often dismissed as the “Whig theory of history”, but Hume was no Whig. For him, and Edmund Burke, the result was more a happy accident of history than the predestined march of progress advocated by historians such as Macaulay. What bound a diverse group of thinkers such as Hume, Burke and Macaulay together was a belief in the importance of the British constitution to economic success.

The importance of political institutions has again come to the fore in the literature, particularly the recent great dilogy of Francis Fukuyama on The Origins of Political Order and Political Order and Decay as well as the Acemoglu and Robinson’s books Why Nations Fail and The Narrow Corridor.

Over the course of the 20th Century, it was the Conservative Party that repeatedly sought to defend the constitution against innovations that threatened to undermine it recognising its importance. In 1997, the Conservative Party’s manifesto warned that “alone in Europe, the history of the United Kingdom has been one of stability and security; We owe much of that to the strength and stability of our constitution – the institutions, laws and traditions that bind us together as a nation.” It went on to add that “radical changes that alter the whole character of our constitutional balance could unravel what generations of our predecessors have created.”

Even as late as 2010, the Conservatives promised to oppose the “constitutional vandalism” of the Labour years. Yet in truth, the Conservative Party has seemingly given up on its role as defender of the Constitution, and seeing constitution policy as a tool of political management.

Repeated referendums, a tool dismissed by generations of British politicians, have undermined our Parliamentary Democracy. Whenever a great issue of controversy ensues, it is far too easy for proponents to simply call for a referendum because that has become our constitutional precedent. Issues as diverse as proportional representation, the future of the NHS and Net Zero have seen calls for referenda. All this encouraged division, rather than debate and compromise. How can the Conservative Party resist calls for referenda, when it has often been their most prominent advocate?

On the House of Lords, the Conservative Party seemingly has no position. As recently as 2015, the Conservative Party still saw “a strong case for introducing an elected element into our second chamber”. In 2019, the Conservatives promised a Constitution, Democracy and Rights Commission to look into this issue, but nothing has emerged. The Party has packed the Lords with donors that has further undermined its credibility but has also given up making the argument for why it is necessary.

The only thing that the Conservatives have come out strongly in favour of in recent years has been maintaining first past the post in elections, although this too is coming under threat. Labour Conference’s decision to back proportional representation now means that all the major parties, bar the Conservatives, are pushing for voting reform. A form of PR is now a distinct possibility.

Judicial activism, that scourge of US politics, has been rising in the UK. Rather than respecting the primacy of Parliament, campaigners now seek to go around it.

Perhaps the greatest damage has been to Cabinet Government. The principle of Cabinet Government, even if it is only imperfectly implemented, has been critical to our constitution.

The central idea is that the Prime Minister is not a President but must carry with him his colleagues in Cabinet and be bound by collective responsibility. In essence, it is better to have twenty-one heads in the room debating a problem and coming together on a solution, than to rely on one. In general, Cabinet meetings have, over time, become less frequent (now once a week compared to several times a week) and shorter. The composition of Cabinet has also been undermined, rather than a representation of all the ‘factions’ or ‘wings’ of governing MPs, it has become merely a loyalist clique. This has undermined the essential characteristics of British government, debate and decisiveness. There is little debate and because the Cabinet is often ‘cut off’ from its own MPs, it is often not decisive because it cannot bring backbenchers with it.

This may all seem like abstract theory, but increasingly we see political and policy paralysis. The government is increasingly unable to get its business through. Reforming public or private institutions has become almost impossible because the constitution does not work. In the long run, it is not individual policies that determine the health of an economy, but the institutions that govern it. Restoring the British constitution is the greatest ‘pro-growth’ policy that the Conservatives could embrace in 2023.

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