Free market capitalism, as any school economics student would tell you, is what it says it is. It is about a free market in good, services and capital and labour. Free market capitalism is about the free movement of products and services and money and workers. Any measures that impede such movement are constraints upon freedom and would have been deemed by neo-liberal writers such as Milton Friedman as being anti-capitalist.
Constraints upon the free market were proposed in 1976 in the Alternative Economic Strategy written by Tony Benn, the Secretary of State for Industry. A leading Left-wing politician he proposed Britain adopt the model of a “siege economy” in order to facilitate its economic revival.
Benn argued for what he believed to be a real Labour policy which he believed would include a policy of “saving jobs, a vigorous micro-investment programme, import control, control of the banks and insurance companies, control of export, of capital, higher taxation of the rich, and Britain leaving the Common Market.” In his diaries, Tony Benn wrote of his proposals as “the protectionist course which is the one I have consistently recommended for two and a half years . . . protectionism is a perfectly respectable course of action. It is compatible with our strategy. You withdraw behind walls and reconstruct and re-emerge.”
Withdrawal from Europe, constraints on the free market, protection of British industries, these were the proposed responses from the Left to the loss of jobs and decline of living standards among people of working-class communities.
Four decades later, the Left remained an anti-European Union/pro-Brexit constituency. The EU was perceived as a neo-liberal organisation. The free movement of goods and services and capital and labour enabled companies to locate in cheap regions and sell throughout the Union; it enabled them to employ labour from wherever workers were the cheapest. The bargaining power of the trade unions was eroded; traditional industries were lost; companies avoided taxes in Britain by registering in jurisdictions where they paid less.
The Left believed departing from the EU would enable British workers to re-establish their bargaining power, enable trade unions to recover their leverage. Measures to inhibit the free movement of labour would inhibit the capacity of companies to find cheap alternatives to British workers.
The controls on migrant labour proposed by the Home Secretary, Priti Patel, are a fulfilment of the aspirations of the Left. Without a pool of cheap labour upon which to call, employers will be forced to pay higher wages.
The next step will be to inhibit the free movement of goods and so protect British industries. Tony Benn would be pleased.