Nick Clegg is being worrying illiberal on executive pay

Nick Clegg is one of the most instinctively, intuitively, genetically liberal people I have ever had the pleasure to meet. That is why I was surprised, and indeed disappointed, when I heard him talking about limiting pay at the top of the private sector. He told Andrew Marr:

“I believe that people should be well paid if they succeed. What I abhor is people who get paid bucket loads of cash in difficult times for failure.”

This is not quite the hyperbolic nonsense that some Liberal Democrat MPs like to indulge in, but it still makes me a bit uncomfortable, and I am not entirely sure that it is liberal.

I’m hugely in favour of transparency, breaking up closed shops across all sectors, and rewarding success, that is true liberal, free marker economics. Empowering shareholders also seems entirely proper and sensible. Furthermore, Clegg is right to say “we’ve been quite tough on unsustainable, unaffordable things in the public sector.” However, the point is that the public sector is the part of the economy that is directly controlled by the government, that by definition creates very little growth or wealth. In my opinion government has very little right to try and dictate the remuneration levels private enterprises offer their executives.

The Deputy Prime Minister has made it clear that the government will not be setting pay levels (he’s thankfully not gone completely bonkers,) but does seem to be hinting at pay-ratios as one possible proposal, which is quite simply anti-meritocratic. Clegg’s point is that some executives in the private sector are being rewarded despite not bringing success to the companies they lead, but this generalised nonsense, and give the comments a distinct anti-success feeling. They actually sound horribly Miliband-esque, a sentence I’d never thought I’d write about Nick Clegg. Liberals should be unashamedly pro-success, not guilt tripping those at the top, and using dog-whistle rhetoric to try and win back a set of voters and members who probably aren’t there anymore, and who aren’t that liberal anyway.

Similar sentiments were banded out by Business Secretary Vince Cable, who will deal with the review and any subsequent legislation, in his conference speech:

“What Liberal Democrats should focus on are the vast disparities in wealth – much of it in inflated property and land prices artificially generated by the boom of the last decade.”

What is artificial, Saint Vince, is government wonks deciding that a CEO can only be paid 20 times more than their cleaner.

I’ll say it over an over – Liberals should be focussing on improving conditions at the bottom, not sopping to the left and attacking the top. We should want everyone to be richer and more successful.

It is  sadly the type of thing I have come to expect from Cable now, but I expected better form Nick Clegg. I hope the moves don’t go beyond greater boardroom transparency and shareholder influence, and we that we indulge this rhetoric no longer.