A Labour Manifesto to Move Markets
It’s a two-horse race to rule Britannia in December’s snap UK election. Labour left is up against Tory right, and under lights yesterday, Jeremy Corbyn unveiled Labour’s election manifesto. Depending on your market exposure, it’s either 105 pages of hope, hilarity, or horror!
Those trading Britain’s FTSE 100 stock exchange fear Corby would only withdraw, rather than deposit value economically as Prime Minister, but you wouldn’t know if given the smiles at Labour’s party conference yesterday. There were splendid promises of spending £75 billion on new council homes, smaller school class sizes, free broadband, and even 3,000 new bus routes. What’s not to like? Ambitious plans are exactly what the Labour party is all about!
The Invstr community, however, has read the small print. Tax relief for entrepreneurs would be scrapped, companies would struggle to hedge currency risk (despite Labour’s promised renegotiation of a Brexit deal that would make the pound more volatile), and corporation tax would go from European lows of 19% up to 27%. Budding investors shooting their shot have clearly been thrown under the bus, but that’s exactly what the Labour party is all about!
The biggest ownership grab since World War 2 is also in the manifesto, with the country’s energy grid, mail, rail, and water industries set to be nationalized. That could sting, and a nation of shopkeepers is asking questions about plans to raise the living wage to £10 per hour, too. Every new winner creates a new loser somewhere!
Corbyn is hailing all this as part of a “radical” pitch that promises “real change for the many, not the few.” It’s “radical,” alright, but equally radical will be its funding! Tax hikes? You betcha, and not just on businesses! Anyone labeled as a “banker, billionaire, or member of the establishment,” will foot this bill. Many bankers and billionaires in opposition claim that by Labour’s definition, that’ll encompass folks who aren’t really bankers or billionaires at all, but hey, that’s exactly what the Labour party is all about!
How will Boris Johnson’s Conservatives answer back? The ball is in BoJo’s court!