From philosophy teacher to politician tipped as a future Tory leader

Theresa May has just about survived another Conservative conference but the vultures are still circling and the Brexiteers say she’s on borrowed time.

Some think May will be out as soon as the Brexit negotiations have concluded and her replacement will once again have to patch up the rift over Europe that has plagued the Tories for decades.

Will we see a re-run of Boris Johnson versus Michael Gove, who took each other out in the last leadership battle in an unseemly political murder-suicide, or a bid by Jacob Rees-Mogg who appears to want to take Britain back beyond 1973 to 1873 or even further?

Or will the next leader be drawn from further down the Tory ranks, a philosopher king with a pragmatic foot in both camps?

In 2013, when David Cameron was still socking it to Nicola Sturgeon as the champion of the British Union, the right-leaning Spectator was already thinking about who could replace him when he finally fulfilled his ambition to (ahem!) lead the country into the 2020 election.

Bruce Anderson, the former political editor who tipped Cameron for leader as far back as 2003, singled out former philosophy teacher Jesse Norman as a future leader.

He was just a lowly Hereford MP at the time, with a few weighty tomes in his academic bibliography including Compassionate Conservatism which was published in 2006 and was regarded as a blueprint for the Cameron government.

In the intervening time, Norman has been elevated to a junior minister for roads, local transport and devolution, and he has just published his latest philosophical treatise on renowned Scottish thinker Adam Smith.

But for a man who thinks so deeply, his thoughts on a future leadership bid are far from philosophical.

“The proposition is not one I have given much thought to,” he told Holyrood on a recent trip to Edinburgh to promote his new book. Really?

“The answer to the question is, um, er, occasionally it gets said, and occasionally the thought occurs to me when I’m sitting in the bath wondering how I would do things differently, but the moment never lasts very long and, you know, it’s hard to imagine.”

His ‘not quite no’ is coupled with a polite refusal to weigh himself against another hotly tipped contender, Ruth Davidson, whose own ‘not quite no’ has recently evolved into ‘not right now’.

Tories seeking their unifying white knight may have to give Norman a bit longer to ruminate in the bath, but in the meantime he has plenty of ideas on how to run a country.

However, his brand of ‘Compassionate Conservatism’ will be anathema to the left-wing majority in the Scottish Parliament, where the Conservatives are still a bit of a cult band despite their growing influence.

According to Norman, austerity is sensible, tuition fees are progressive, the youth are more empowered than ever and automation will set the working man free.

“It’s a mistake to think that there is any conflict between compassion and austerity,” says Norman, and one can almost hear Scotland’s socialist sodality cry out in anguish.

“Compassionate Conservatism is not about increasing the amount of money the state spends. Austerity is, broadly speaking, a sensible reaction to a period in which government had massively overspent. Blair and Brown were running significant budget deficits at a time of significant economic growth, exactly the point when you should be putting money away for the down cycle.

“German Wolfgang Schäuble famously said, ‘You call it austerity, we call it sensible financial management’. Austerity was just a political term for moving money back to a sensible level.

“Tuition fees have been socially progressive. More kids go to university from poor and black and minority ethnic backgrounds. People who oppose it have to explain why they want fewer poor kids and fewer BME kids to go to university. Look at the higher education sector in Scotland, where fewer less well-off kids are going to university and university is becoming increasingly dominated by foreign students. If the Scottish Government opposes both of those things, why do they have a policy that creates it?”

Norman positively bristles when presented with the mainstream opinion in Scotland — particularly within the SNP — that tuition fees rob today’s youth of opportunities enjoyed by their parents who also benefited from cheap housing and generous pensions.

“I don’t accept the idea of generational warfare,” says Norman.

“I don’t think the older generation has been taking decisions designed to impoverish their children or grandchildren. Very often they spend all their time thinking about how they can support their grandchildren.

“Young people today have opportunities that would have been unimaginable to people growing up in the 1950s or 60s. If you’d told them you could take a holiday in the south of Spain for a few hundred quid, that would have been regarded as outlandish. If you gave them a phone which could do an astonishing range of things, it would have been regarded as magical. Rothschild, the richest man in the world in the 19th century, died of a tooth abscess which could have been cured by a £5 antibiotic today.

“The idea that previous generations had it better is simply not true.

“Many people in their 20s and 30s will probably live to 100, with an extended happy life and a greater amount of leisure, and that creates a world of incredible opportunity and possibility, not generational warfare.

“Ask yourself the question — at what time of history would you rather have been born other than today?”

Sensing his indignation at questions he may not be regularly exposed to in Herefordshire, but form part of the daily cuisine at Holyrood, I throw him a bone and admit I do value my iLife.

As a teenager, all of my weekly pocket money went on 10-track CD albums and single movie DVDs at £5-£10 a time, plus the ever-increasing cover prices of NME and Melody Maker, while today nearly every movie, song and rock review ever produced are available for a relatively small monthly subscription.

However, this has come at the cost of well publicised hardship for professional musicians while serious music journalism is a shadow of its 20th-century heyday with the demise of NME and other music magazines.

As more and more commodities become digitised and the production of physical goods is handed over to robots, manufacturing jobs will go the same way, forcing engineers and assembly line workers to retrain, retire or take redundancy.

Which brings us round to Adam Smith, the focus of Norman’s most recent work, whose book The Wealth of Nations studied the rise of machines and assembly lines in the early days of the Industrial Revolution and their impact on the distribution of wealth.

“Automation has been happening for over 250 years because machines can be more productive than humans at given tasks,” says Norman.

“Hopefully, they create more prosperity if [production] is guided and managed well to give people more leisure time to pursue the things that give them a sense of joy, achievement and meaning.

“I think Adam Smith would dispute the idea that more automation means the end of the work.

“Smith decries the ‘mental mutilation of repetitive piecework’. When all people ever do is make pins then their minds are undermined, which is why he supported universal education for men and women.”

However, Norman insists Smith would be sceptical about one of the plans to redistribute the wealth of automation — proposed by the SNP and others — through a universal basic income.

How will people earn money to buy the cars and computers produced by robots when all production has been automated, with just a handful of Elon Musk-style megalomaniacs manning the on/off switch?

“Adam Smith would probably say people would find interesting ways to continue to work and fill their lives with meaning which amounts to work,” says Norman.

“He would worry about the economic incentives being set by a universal income. Would people still have the economic incentives to create value if they knew they would receive a high universal basic income whatever happens?

“He would also worry about the cost and how the burden of the cost would be distributed across the economy. Smith does not merely see things in economic terms but also in social and cultural terms. In many ways, a welfare state does provide a universal basic income, so we’re really talking about an income set significantly higher than the current income levels and that would create some of the incentives that I have described.

“Smith’s view would be that the rise of the technology platforms is absolutely a cause for concern, because it can be a form of crony capitalism.

“That is why his work is so appropriate today because many of these markets do look like they’re being manipulated or subjected to crony capitalism — insiders having privileges and advantages versus outsiders, managers not doing what the shareholders want and getting too close to government, rent extraction, using position to generate profits that are higher than market returns and all of the lobbying of government that comes with that.

“There is an asymmetry between the masters and the workers and that is why legislation should favour the workers, and that means potentially, meaningful and higher wages.

“And of course, he specifically says that in labour negotiations between the diverse and dispersed mass of workers and individual masters of companies. He said legislation should always favour the worker because they have intrinsic disadvantages. That is an egalitarian system.”

Norman knows the value of abandoning well-remunerated work to pursue something more spiritually fulfilling, after he ditched a job on Wall Street to run a charity in Eastern Europe in the dying days of Soviet communism. But he is no huckster turned hipster, for he eventually returned to banking after the fall of the Berlin Wall when he realised these newly liberated economies did not want a hand out but a hand up.

“I have found myself stepping away from things that, by the world’s standards, were incredibly remunerative and important but which I didn’t think were important,” says Norman.

“I started on Wall Street in 1987 and I first went out to Eastern Europe in 1988, going on to run a charity giving away educational medical textbooks.

“We had no idea the Berlin Wall was coming down but it all kicked off in the summer of 1989 and it was an extraordinary moment, because if you had been in Eastern Europe before the wall came down, you had 1,000 times more credibility. Virtually no westerners had been so I had a brief period of working with a small group of people and really affecting change.

“By 1991, I realised what Poland, Hungary and Czechoslovakia needed was not philanthropy but access to western finance, investment and advice so I went to work for Barclays in 1991, lived in Prague for a year and ran a big fund investing in Czech voucher privatisation.

“By 1997, I didn’t think the banking business had a great deal of life left in it so I went off to study philosophy.”

Norman was elected to parliament in 2010 and was handed a seat on the Treasury Committee which was scrutinising the recent financial crash, examining how banks were cleaning up their act, how the regulators were behaving, and how this all impacted on the British economy.

But like most bankers, he does not know — or will not say — where he thinks the next financial crash will come from.

“I don’t think we’re ever going to get exactly the same banking crisis,” he said.

“It is fascinating looking back to Adam Smith’s analysis of the Ayr Bank Crisis of 1772, which was the same kind of general phenomenon, over-leverage leading to a run on the bank and ultimately financial collapse.

“You’re going to see those kinds of recurring patterns, but where it exactly breaks out is hard to predict.

“Part of the problem at the moment is that people worry that you have this shadow banking sector, pools of capital that are underregulated, and they may be the source of the problem.

“What is fascinating about many of the problems we have — it was true in 2008 and previously — is they often have similar kinds of behaviour associated with them, exuberance in the markets, over-leverage, too much emphasis on property lending. Adam Smith offers a corrective to that.”

Unsurprisingly, the one thing Norman is absolutely clear about is that the antidote to the next financial crisis does not lie in the ideological socialism espoused by Jeremy Corbyn and his Shadow Chancellor John McDonnell.

“I have no idea what Jeremy Corbyn thinks or doesn’t think, but there clearly are elements of political parties in Britain that do idealise communism, Stalinism or stronger forms of socialism that tend in that direction, but they really have no idea what they are wishing for,” he says.

“I wish I could take them back with me to Poland or Hungary in the 1980s and show them just how people were forced to live under those circumstances and show them the inequality of a party structure that was able to enjoy many of the benefits of western culture that the ordinary mass of humans were not able to.”

He believes the break-up of the Soviet Union was good for its constituent states but — and this won’t come as any surprise either — he does not believe the break-up of the United Kingdom would be good for its constituent nations.

“I don’t think there is a case for a second Scottish referendum, the commitment was it was going to be once in a generation,” he says.

He is also sceptical about the value of a second Brexit referendum, but in a sign of his possible potential as a future unifying force, he is remarkably diplomatic about the direction that Brexit is heading.

He acknowledges that a ‘no-deal’ Brexit “would have significant short-term economic negative consequences”, but he politely refuses to trash talk the arch-Brexiteers who are dragging Britain towards the cliff edge and has equal scorn for both Leave and Remain.

“Both campaigns were shockingly badly conducted and I don’t think the subsequent debate has been particularly enlightening either,” he said.

“There are three difficulties with a second Brexit referendum: it’s not clear it would produce a decisive result; it’s impossible to see how we would get the legislation through before we withdraw; and there doesn’t seem to be any parliamentary support for it.

“I think a second referendum, whatever people think about the merits of the matter, is a dead letter.” •

Adam Smith: What He Thought, And Why It Matters by Jesse Norman is out now.