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Only Free Markets and Popular Conservatism Can Help the World’s Poorest: Daniel Hannan

By: Daniel Raisbeck - @DanielRaisbeck - Jun 6, 2017, 12:25 pm

Daniel Hannan, Conservative Member of the European Parliament for Southeast England, author, and leading Brexiteer, told the PanAm Post that only free markets and popular conservatism can help the world’s poorest in the 21st century. Speaking at Conservatives International‘s first regional conference in Miami on May 26 and 27, Hannan explained that this new global alliance of conservatives and free marketeers, which he founded, “is about taking the conservative message and the free market message to the places where the majority of human beings live and vote.”

The Case for Popular Capitalism

He added that although 70% of people on the planet can’t afford a washing machine, “we’ve been very slow at making an argument of popular conservatism that will appeal to that vast majority of human beings in terms that will resonate with them.”

Popular conservatism can succeed because “the biggest beneficiaries of free trade are poor people in poor countries.” Nevertheless, Hannan explains that many “notionally right-of-center parties in Latin America and all over the world really don’t think that you can win this argument” in favor of free markets. “So you have this sort of oligarchic conservatism, which of course never really wins. We should be offering them something better.”

For Hannan, the neo-Marxist surge in developed countries led by Jeremy Corbyn in Britain, Bernie Sanders in the US, and Podemos in Spain is “a delayed response to the financial crisis of 2008. After the fall of the Berlin Wall, socialism looked as if it was completely finished. It was an ideology confined to a few lunatics on the very edge of politics.” But after the financial crash of 2008, the Marxist analysis that the free market is a racket “began to look as though it had a kernel of truth,” particularly because governments were bailing out industries, “wealthy bankers and bondholders” with taxpayer money.

In Latin America, Hannan states, the “leftist populist surge” came a decade earlier, but “the underlying reason wasn’t so different; it was the idea that the capitalist system wasn’t for everybody, that it had turned into an oligarchy, into a cronyist system where the people already in power were able to entrench their position at the expense of everybody else.

However, “if we are 100% honest with ourselves, there was some validity to that criticism in the 1990’s. There had been a broad failure of parties that called themselves right-of-center around the region. This is why we need to do better.”

And free marketeers need to do better because Marx clearly was wrong. “You could argue that he was ultimately responsible for the ideology that killed 100 million human beings, which is a record that nobody else gets close to. But he was also just wrong in all the predictions he made,” starting with “his basic contention that the rich would get richer and the poor would get poorer is just not true. Capitalism has enlarged the middle class wherever it’s been practiced and has raised the living standards of the poorest people.”

Redistributive populism is therefore doomed to failure. Hannan points out that “the populists fail ultimately in their own terms because they cause the most impoverishment to the people who voted for them in the first place. In particular economic protectionism, which always ends up in cartels and raising prices, hits the poorest people, because they have to spend the highest percentage of their income in buying basic commodities. So they are always the first victims. And you can see this very vividly in Venezuela.”

The dismal outcome of 21st Century Socialism in Latin America “creates an opening again for something different” from conservatives. “And it would be tragic if we just came out with the same, weak, oligarchic conservatism that was corporatist and was genuinely aligned with big banks and big business… You have to offer people a popular conservatism based on opportunity, based on cheaper prices, based on anti-corruption, fewer government officials… People get that message. Even if they have limited education, everyone gets that more government officials means less opportunity for them.”

The British General Election

As for the current campaign in Great Britain ahead of Thursday’s general election, Hannan thinks that although Prime Minister Theresa May “is coming from the center-left of the party on economic issues” and her manifesto does not make the case for “a further radical rolling back of state power,” “a lot of things that were done 30 years ago by Margaret Thatcher are now uncontentious,” so that some of the current Conservative Party’s policies are “well to the libertarian right” of Thatcher in 1979.

While some recent polls suggest that a far left Labour Party under Jeremy Corbyn has significantly cut May’s initial lead, which had many pundits predicting a landslide Tory victory some weeks ago, Hannan insists that Corbyn “is not just literally a Chavista,” but that “he regrets the outcome of the Cold War.” Corbyn, says Hannan, “cannot bring himself to aportion moral blame to the IRA, or Hezbollah, or Hamas, or even Daesh (Islamic State), because he thinks it’s always the fault of western foreign policy.”

This is why Hannan thinks that, despite some negative results in certain opinion polls, May and the Conservatives are on course for “a comfortable working majority” which the Prime Minister does not have now, since the Conservatives have “a fragile majority” of 10 MP’s.

Making a Success of Brexit Means More Trade for Latin America

It is particularly important for May to obtain a stronger mandate ahead of the Brexit negotiations with the European Union, Hannan states, especially because “she understands that the worst possible thing would be to try to implement Brexit in a half-hearted way.” Although May supported Remain during the referendum campaign in 2016, as Prime Minister she has embraced Brexit and sought “to make a success of it.”

As to what a successful Brexit will mean for free markets, Hannan mentions the example of trade relations between the UK and Argentina. “We were Argentina’s biggest market until we joined the EU… That came to an end in 1973 and it was disastrous for the Argentine economy and contributed to political instability of that country. There’s absolutely no downside to either of us if we can restore a genuinely open free trade agreement. It is absurd that we’re paying tariffs on Argentine wine. Where are the Malbec vineyards in the south of England that we’re trying to protect?”

“There are opportunities here for everyone. If we can have a good trade deal with Mercosur, it benefits everyone,” while the EU maintains its protectionist policies in agriculture at the expense of other continents.

Daniel Raisbeck Daniel Raisbeck

Daniel Raisbeck is the PanAm Post's Chief Editor. He ran for Mayor of Bogotá in 2015 as an independent candidate. Follow him @DanielRaisbeck.