Labour Don't Understand Markets: No 94

Saturday, February 28, 2009

Labour Don't Understand Markets: No 94

Iain Dale 12:02 AM

One of the predictable consequences of the banking crisis has been the spectacle of Labour MPs reverting to type in their slavering hostility to the market economy. Brown's Labour Party has largely kept its anti-capitalism beliefs hidden but now they've been set free (who needs Clause 4 now bruvvers?), the current state of the economy has brought those deep seated and hidden in the darkest places, anti-market views, bubbling to the surface.

Last week witnessed one small example of the Government caving into the anti-market brigade; a consultation from Andy Burnham’s department proposing a clamp down on people re-selling tickets.

It could have been worse. Thankfully, the Government ruled out a complete ban on the re-sale of tickets. But overall, the document exposes Labour’s failure to understand the basic principles of market economics, its default preference for regulation and its ‘we know what is best for you’ attitude.

Here is a typical example; Labour ministers want to introduce a “voluntary” (now where have we heard that before) ban on ticket touting for major events like the FA Cup and Grand National. All that will achieve is to make it impossible for legitimate fans to sell unwanted tickets. EBay and other ‘online’ market places argue that you can be sure it won’t stop street touts – instead, they’ll have the market all to themselves and will line their pockets.

What this sorry episode reveals is that Labour still doesn’t understand the basic rules of supply and demand. Pretty worrying when you consider that Andy Burnham’s last job was at the Treasury…but I suppose he knows that if his beloved Everton ever get to a final he will be given a ticket - well as long as they do it this season or perhaps next.