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Gove will bring Big Business to heel

The justice secretary understands the need to reform capitalism.

I have had the privilege during the past three years of working closely with Michael Gove. As lead non-executive at the Department of Education when he was secretary of state, I saw a man of prodigious energy, who was not only brimming with ideas but had the organisational skills and attention to detail to turn those ideas into reality. This is a rare combination, whether in business or politics.

When Gove moved to the Department of Justice, we saw him repeat the process. Driven by a belief in the capacity of each individual for personal redemption, he has brought the same energy to prison reform as to education. He has also harnessed business brains to redesign the prison estate, releasing hundreds of millions of pounds for the exchequer.

At the launch of his leadership bid on Friday we heard him extend his reforming vision to the full canvas of public policy. And perhaps most striking were his thoughts about the reform of capitalism.

Capitalism in the 21st century has become increasingly detached from its moral moorings. Democracies (whether in the US or Europe) have been suborned by the lobbying power of Big Business; executive pay has been detached from performance due to the agency problem at the heart of corporate governance; and the workings of quantitative easing have turned global monetary policy into an instrument for making the rich richer.

With hindsight, it seems almost unthinkable that big American banks, such as Goldman Sachs, JPMorgan and Citigroup should have made sizeable corporation donations to one side of the argument in a referendum in a foreign country. But the fact that they did shows just how far the world of Davos man is out of touch with the concerns and circumstances of the ordinary voter. One of the lessons of the Remain campaign is that Big Business is neither in touch with nor respected by the wider public.

The time is right for reform of capitalism and that reform cannot be carried out by parties of the left who do not understand how wealth is created and whose attitudes to capitalism range from an uncritical love-in (New Labour) to undiscerning hostility (Ed Milliband and Jeremy Corbyn).

The reform of capitalism has to be carried out by a Conservative Party which understands both the the benefits and limitations of markets.

Gove set out the foundations of such a programme in his leadership speech. One of his great political heroes is Theodore Roosevelt, the American president who is perhaps best known for taking on and breaking up the big monopolies in oil, railroads and steel. Roosevelt may not have been popular with Rockefeller but he was certainly popular with the American people.

It is interesting to speculate how Theodore Roosevelt would have voted in the Tory leadership elections. One of his most famous quotations provides a clue.

“It is not the critic who counts; not the man who points out how the strong man stumbles, or where the doer of deeds could have done them better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs, who comes short again and again, because there is no effort without error and shortcoming; but who does actually strive to do the deeds; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best knows in the end the triumph of high achievement, and who at the worst, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who neither know victory nor defeat.”

I think Theodore Roosevelt would be supporting Michael Gove.

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