1960s >> 1964 >> no-717-may-1964

City & Labour Party

It is a popular misconception that a Labour victory in the Autumn will be bad for the capitalist class; that production, investment, and so on, will be less profitable and that business will, therefore, be in the doldrums.

It is true that the City generally prefers a Conservative government, but this is not to say that their professed fear of a Labour government is sensible. Business men, after all, are as capable of misjudgement as anyone else. And, anyway, there are plenty of industrial and commercial tycoons who support the Labour Party.

Robert Heller, the Business Editor of The Observer, has polled what he calls “influential City men” on their reactions to a possible Labour government. He reported the comments of seven of them an April 12th last.

Two of them thought that a Labour victory would be bad for business; two thought that it would have little or no effect. The other three thought that the policies of a future Labour administration would depend upon the conditions under which it took power—in particular, on the size of its majority.

Three said that investment was being held back by the prospect of a Labour government. The other four said that this prospect was having no real effect on investment.

One thought that the Stock Exchange had not adequately discounted the risks of a Labour victory—had not, in other words, sufficiently rearranged its interests so that they will remain just as profitable when Labour policies are in action. One gave no opinion on this question, but the other five were of the opinion that whatever risk there may be had been adequately discounted.

What this means is that the attitude which the capitalists are adopting to the prospect of a future Labour government is much as we might expect. Some Labour policies, they think, may be bad for some types of business. In the same way, some of them probably think that some policies of the Conservative government have been bad—the R.P.M. Bill, the attempt to join the Common. Market, and so on.

But, as Robert Heller comments: —

“With certain extremely forthright exceptions, they don’t regard the prospect as very dreadful. . . . Some top boardroom names not only hope but expect to carry on business as usual. (Under a Labour government).”

A Wilson administration may bring some superficial differences in the overall pattern of commercial, industrial and investment affairs.

But the City still expects to be able to carry on and to show some nice profits for the shareholders.

And the City is right.

Because under a Labour government capitalism will still be there.

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