To judge by recent newspaper headlines, something is going wrong with the British version of capitalism. There are two related items on the charge sheet. One is that companies are exploiting their customers in order to maximise short-term profits. The other is that this preoccupation with financial performance is holding back needed investment and helping to turn Britain into a low-skill, low-wage economy.
Consider the evidence. This week, first the Archbishop of Canterbury and then a former Conservative prime minister accused the energy companies of profiteering by pushing up prices at an unjustified pace. Making the case for a one-off windfall tax on the sector, Sir John Major said that “governments should exist to protect people, not institutions”. Continue reading »