Maybe I’m getting soft in my old age, but I sometimes feel like the Left gets a bit mean about Tony Blair on occasion. Sure, he had a strange fetish for ID cards and big authoritarian databases, and there was that whole dubious invasion of Iraq thing to contend with. But his government also introduced the minimum wage and the human rights act, invested in public services, pulled the NHS out of its post-Thatcher dive…. This country has had many worse governments. It has one now.
But there is one area of public policy in which the Blair government failed utterly – perhaps because it didn’t see it as an area for public policy at all. Housebuilding, Blair always seemed to think, was one of those areas where the government’s main job was to get out of the way of the market. The market enthusiastically agreed, and proceeded to build a whole fraction of the homes Britain needed.
The entirely unforeseen and impossible to predict consequence of all this was that house prices soared, far faster than the wages of the people buying them. Between 1997 and 2007, UK house prices rose by an average of 21 per cent a year. Wages, it’s fair to say, didn’t follow.
So, Blair’s legacy on housing is a disaster, a mass transfer of wealth from poor young people to rich old ones. That’s not the sort of legacy any government wants – and so, I imagine, the former PM probably feels pretty bad about it.
Anyway. On Monday, the Guardian reported that the Blairs now own a £27m property empire containing 37 different properties. They own an £8.5m Georgian townhouse in Connaught Square (that’s more than doubled in value since they bought it in 2004). They own a £750,000 country home out in Buckinghamshire (I mean, we all like to get out of London sometimes, right?).
The Blairs, to be fair, aren’t keeping all this wealth to themselves, but are redistributing some of it. Specifically, they’re redistributing it to their children, three of whom have names on the deeds of their own central London properties worth upwards of £1m. Eldest son Euan is also a director of Oldbury Residential, a buy-to-let company with 27 homes in Greater Manchester, which he co-owns with his mother, Cherie. His younger brother Leo doesn’t yet seem to own any real estate, in prime central London or otherwise. He’s only 15, though, so there’s still time.
To be fair to the Blairs, they’re only doing what many other families have done. Buy-to-let homes have become the asset class of choice for the well-to-do baby boomer, for the very good reason that returns on most other forms of investment have been rubbish. And, as the bubble has inflated, more and more affluent parents have felt it’s their duty to pass the wealth down to their kids. It’s rational. It’s natural, even.
But there are two problems with this argument. One is that, however inadvertently, Tony Blair was one of the architects of the housing crisis in which we now find ourselves and of all the problems that flow from it. I don’t think that was deliberate – but he is nonetheless profiting from a crisis that he helped to create, and that’s a pretty big black mark against any leader’s record.
The other problem with dismissing the Blair property empire as normal, middle class behaviour writ large is that it downplays quite how damaging the buy-to-let boom actually is. It isn’t simply that it’s crowded first-time-buyers out of the market, though that hasn’t helped. It’s that it’s created an entire class of people who have a financial interest in keeping rents as high, and housing regulations as weak, as possible.
Landlords tend to be older and richer than their tenants; they’re also more likely to stay in a constituency, and more likely to vote while they’re there. All those things make it far easier for the former group to get their voices heard than the latter.
As if that weren’t enough, nearly a third of MPs are landlords too, and while most no doubt think they do their best to hear both sides of the argument before legislating, they will nonetheless find it much easier to grasp the arguments against stronger tenant rights than the ones in favour of it. People are generally remarkably adept at seeing the moral case for their own financial self-interest.
The government of Tony Blair helped create the buy-to-let class. Now, he is its prophet, its talisman, its patient zero. Yes, the Blairs are only doing what any other rich, middle class family would do. That is precisely the problem.
Jonn Elledge edits CityMetric and tweets as @jonnelledge.This article is from the CityMetric archive: some formatting and images may not be present.