Capitalism is the only way, UK finance minister says in challenge to Labor

British finance minister Philip Hammond defended capitalism as the only route to prosperity on Oct. 2 in an attempt to counter the opposition Labor Party’s increasingly popular vision for a more centrally-controlled economy.

Hammond is due to speak at the annual conference of his Conservative Party, seen as a chance for Prime Minister Theresa May’s government to try to repair relations with the party’s grassroots after a botched election in June.

Divided over Brexit and losing public support to a resurgent Labor led by socialist Jeremy Corbyn, May is leading a fragile minority government.

Ahead of his speech to party activists, Hammond, finance minister for the center-right party since July 2016, talked up the merits of a free-market economy.

“It isn’t a coincidence that every country in the world, apart from North Korea, Venezuela, Zimbabwe and Cuba have adopted the market economy system that we operate here,” Hammond told ITV.

“It’s happened because it is almost universally recognized that this is the way to advance nations, to get people’s living standards up, to create jobs and sustainable progress, to support public services.”

That view has been challenged by Labor, who last week at their own party conference fleshed out plans for a wide scale nationalization of Britain’s infrastructure, higher government spending, and more taxation and control over the banking sector.

Hammond’s words echo those of May, who last week issued her own defense of capitalism - a sign of growing concern about the threat

Labor poses to the pro-business orthodoxy that has underpinned British economic policy since Margaret Thatcher’s reforms in the 1980s.

“As this model comes under renewed assault, we must not be afraid to defend it,” he will say.

“Our economy is not broken: it is fundamentally strong.”

Last month rating agency Moody’s downgraded Britain’s credit rating, saying the government’s plans to bring down its debt load had been knocked off course and Brexit would weigh on the economy.

The Conservatives will pledge 400 million pounds ($535 million) of additional road and rail spending, but Labor said the plans did not go far enough.

“Hammond just wants to continue with the seven years of Tory economic failure that has seen the level of investment in our country fall behind many of our international competitors,” Labor’s finance policy chief John McDonnell said.