Nick Clegg has recently attracted considerable attention for suggesting that each citizen on the electoral register should receive a free allocation of the shares held by the government in the part-nationalised banks Lloyds and RBS.
The proposal is merely the latest iteration of an idea that has received a good deal of attention in recent times. The most obvious source for Clegg’s proposal is a pamphlet written by Liberal Democrat MP Stephen Williams, but both George Osborne and the ‘Red Tory’ Phillip Blond have made similar suggestions the last eighteen months. In truth the proposal is merely the latest example of a long Liberal tradition of advocating wider ownership. My research into the politics of property-ownership indicates that Liberals and Liberal Democrats – like many Conservatives – have strong distributist instincts.
An early manifestation of these instincts can be found in the Liberal Party’s 1938 report, Ownership For All. Written largely by Elliott Dodds and Arthur Seldon (later to find fame as Editorial Director of the IEA) the report sought to reassert classical liberal principles and emphasised the central importance of widely diffused private property for a liberal society and an efficient economy. The report contended not only would the diffusion of property lead to a rapid improvement in productive efficiency, but the decentralisation of power and responsibility would also increase personal liberty and independence.
In his summary Dodds attacked both the Conservative and Labour parties for their belief that property should be concentrated (respectively, in the hands of the few and the hands of the state); by contrast, the Liberal view was that property is ‘like muck – only good when it is spread’.
A more direct comparison with today’s proposals can be seen in ideas that surfaced in the late 1970s and early 1980s. Faced with the question of what to do with the revenues generated by North Sea oil, many Liberals seized on an idea floated by Samuel Brittan and Barry Riley in The Financial Times. Later expanded and reissued as a pamphlet in the party’s Unservile State series, A People’s Stake In North Sea Oil proposed to use the windfall from the extraction of the oil to give everyone on the electoral register a marketable capital account. Such a policy guaranteed genuine ownership for all and would, said Brittan, represent a ‘giant stride towards a genuine people’s capitalism’.
However, few if any of these proposals were ever brought to fruition. This interest in the wider diffusion of property has largely coincided with a prolonged period in the electoral wilderness. Being in coalition at a time when there is a considerable public asset to dispose of therefore gives the Liberal Democrats a unique opportunity to make their dreams of wider ownership a reality – it will be fascinating to see whether they can seize it.