Witness that in government media briefings rarely are there searching questions from broadcast journalists about how much the measures are costing, who will pay and by what means, what will be the effect on the prospects of a potentially lost generation, on jobs, prosperity and, for that matter, the physical and mental health of the nation as people die of undiagnosed and untreated other diseases.
There is no guarantee of a successful vaccine any time soon, if at all. It is much more likely that the virus will naturally become less deadly, that drugs to combat the symptoms will emerge and that we will learn have to live with the Coronavirus. The history of viruses is thus. I was taking my eleven plus exams and blissfully unaware of Hong Kong flu in 1969 which killed nearly twice as many people in Britain as Coronavirus, especially the young, from a smaller population, but we carried on as normal. But then we didn’t have social media and hundreds of broadcast hours to fill.
This week, Boris Johnson offered us blood, sweat, toil and tiers: in this case tiers 1,2 and 3. Like his biographical hero, Churchill, the PM called on the nation to beat the Coronavirus, as though it were an adversary, when in fact we have declared economic war on ourselves.
We have also witnessed a shamefully opportunistic leader of the opposition take up an economically illiterate position of calling for another national lockdown, when even Labour Mayors in the north are resisting local lockdowns, and the broadcast media drumbeat goes on.
The Prime Minister and Rishi Sunak are right to resist this and now need to put the case strongly. It is also vital that the correct economic policies are adopted in the future.
Britain now has a debt burden of around 120% of GDP as though we have just fought a war, unprecedented since World War 2. While history rarely repeats itself, we can learn from the past and taking Boris’ wartime mantra we must avoid a repeat of our historic experience emerging from that war.
Then Germany emerged with 90% of its machinery, new and intact. It had almost 100% of GDP national debt simply written off. It received free money under the US Marshal Plan which it invested in industrialisation and economic growth. It was not forced to make reparations and spent little money on defence for a decade, as this was guaranteed by the USA and Britain.
By contrast, Britain won the war but as a Pyrrhic victory. Bankrupted by the effort, we lost the peace. The US doctrine from President Wilson onwards was to usurp the empire and the British world system to the benefit of the USA and our weakness at the end of the war provided the opportunity. Britain had to service its massive national debt, pay back US loans, spend 10 per cent of GDP on defending Europe and the West and chose to spend its borrowings on building a welfare state and the NHS, rather than growth and industrial renewal.
This resulted in a basic rate of income tax of 50 per cent and higher rates at eye-watering levels. It also resulted in relative economic decline and a failed political and Mandarin class opting to join the Common Market. We must also avoid the assumption that the USA are our friends, history is much more nuanced on this.
We must avoid this scenario repeating itself as we emerge from the war on Covid. We are in competition with other nations for our future prosperity. It is vital that we avoid further national debt generated by lockdowns which could destroy our prosperity for a generation. At the same time, we should avail ourselves of long-term government debt at historically low rates of interest, and use this to stimulate enterprise and growth and not raise taxes. Only the private sector can generate wealth, the NHS cannot exist without it.
There have been suggestions that the government will need to raise tax by £40 billion. This would lead the country into a doom loop. Borrowing to invest in private enterprise and cut business taxes, not only the important services and tech sectors, but also reindustrialisation so important for the regions and the north, will lead to economic growth and the generation of tax revenues. If this, coupled with QE, results in a competitively devalued currency and a little inflation then so much the better for eliminating debt and stimulating enterprise and wealth creation.
Never has it been more important to stimulate growth, especially for family-owned and/or run businesses who make up the vast majority of the economy and innovation. The multinationals who have deep pockets may find it convenient to have policies that drive out smaller businesses and thus leave them with little competition, but it is enterprise that will provide us with prosperity in the post-Covid, post-Brexit future.
Boris Johnson and Rishi Sunak must drive through an agenda of properly delivering Brexit and of economic growth, thus securing the next election for the Conservative Party.
John Longworth is an entrepreneur and businessman, Chairman of the Independent Business Network and former head of the British Chambers of Commerce and Conservative MEP