The nation that gave the world Adam Smith, the father of modern economics and champion of the invisible hand, now finds itself shackled by a peculiar hybrid: a capitalist command economy. It is neither the free-market neoliberalism decried by the Left nor the outright socialism feared by the Right. Private ownership persists, profits are still chased, and corporations remain nominally independent. Yet the state's grip on economic life has tightened to levels unseen since the pre-Thatcher era. Targets, mandates, price controls, fines, and social engineering directives dictate what businesses can produce, sell, and how they must operate. The market's signals are drowned out by bureaucratic commands.
Christopher Snowdon's recent essay in The Critic captures this drift with precision. Britain's government controls the price of gas, electricity, water, bus and train tickets. In parts of the country, even alcohol pricing falls under state influence. The minimum wage has ballooned from roughly half the average wage in 2010 to two-thirds today. Listed companies face "comply or explain" quotas for female board members. Industry leaders are hauled before ministers for lectures on phantom "price gouging." Supermarkets are told where to display products, car manufacturers fined for selling too many petrol vehicles, and landlords subjected to stealth rent controls through tribunals that redefine "market rate" according to political notions of fairness.
This is not accidental over-regulation. It is a deliberate model. Governments, Conservative and Labour alike, have embraced grand visions of Net Zero by 2050, smokefree generation by 2030, the phase-out of petrol and diesel cars, decarbonised electricity by 2035, and halving childhood obesity. Achieving these without nationalising industries requires a softer form of command: private firms bear the costs and risks while politicians claim credit for moral progress. The Zero Emission Vehicle Mandate forces manufacturers to hit rising EV sales quotas or pay £15,000 fines per excess combustion-engine car. Heat pump targets come with penalties. Procurement rules demand "social value" commitments on diversity, apprenticeships, and emissions. Developers must install solar panels and deliver "affordable" housing.
The Equality Act's "equal value" provisions have produced grotesque outcomes, with activist judges and lawyers equating warehouse work to retail roles, threatening supermarkets with billion-pound payouts. Supply and demand? Dismissed as "so-called" market rates in court. Tribunals and checklists replace the voluntary agreements that once set wages and conditions.
The irony is bitter. Britain pioneered the critique of central planning. Smith warned against the conceit of statesmen who imagine they can arrange society like pieces on a chessboard. Yet today's politicians issue Soviet-style targets while outsourcing the execution, and the blame, to the private sector. Why nationalise and accept responsibility for failure when you can regulate, mandate, and fine? Power without responsibility is the ultimate political luxury. As Snowdon notes, this gives the Left perpetual villains ("greedy corporations") to justify ever more controls, even as true free enterprise withers.
The post-Thatcher settlement has been hollowed out. High taxes and public spending near wartime levels are only part of the story. The deeper rot is the substitution of political planning for market discovery. Rent controls by another name, energy price caps that began as temporary measures and became permanent, boardroom quotas, advertising and display bans, sales quotas dressed up as environmentalism or public health. Each intervention distorts incentives, raises costs, and crowds out genuine innovation. Businesses spend more time navigating compliance than competing on quality and price.
Adam Smith's Britain understood that wealth emerges from the spontaneous order of free individuals pursuing their own ends. The current model inverts this: an activist state assumes its social, environmental, and egalitarian goals trump economic logic. Delivery failures, slow growth, stagnant productivity, energy insecurity, housing shortages, are then blamed on "unbridled capitalism," the very force that has been systematically leashed.
This hybrid system offers the worst of both worlds: the inefficiencies of command without the full transparency and accountability of ownership. It breeds cronyism, as firms lobby for exemptions or subsidies to meet arbitrary targets. It stifles the risk-taking and creative destruction that drove Britain's historic ascent. And it erodes public trust, as citizens sense the rules no longer reward merit or voluntary exchange but political obedience.
Reversing this slide demands more than tax cuts or minor deregulation. It requires a cultural and intellectual recommitment to the principles Smith articulated: humility about what governments can know and achieve, trust in dispersed knowledge and voluntary cooperation, and the courage to let markets allocate resources even when the outcomes offend elite sensibilities. Without that, Britain will continue its slow descent, private enterprise in name, directed economy in practice, proving that even the birthplace of classical liberalism is not immune to the oldest temptation of rulers: the socialist desire to command rather than serve.
https://thecritic.co.uk/on-britain-as-a-capitalist-command-economy/