If Cameron were to declare himself the champion of the free market, and set his face against the type of vindictive and pointless extra regulation in Wall St and Frankfurt, then he could attract some world class talent and make the City grow again. I make a full case in the Daily Telegraph tomorrow.
Now, is Cameron up to it? It would mean going against the prevailing winds – but this is no bad thing if those winds end up putting in Sir Fred Goodwin’s windows. At the last Tory conference, Cameron did precisely this – declaring himself a champion of the free market and being one of about a dozen people, at most, who were being so. This speech should be his template – not just in office, but in opposition too. Defending capitalism means being harsh with those who break the rules, so Cameron’s call for prosecutions in the City are in no way inimical to all this.
My final point: can you name any industry where Britain has a larger comparative advantage than finance? We must turn to finance again, hoping that the City will catch the wind of global finance when it eventually picks up. Learning to love bankers may be politically difficult for Cameron, but it is our best hope for a fast recovery.