IN “ATLAS SHRUGGED”, published 60 years ago this October, Ayn Rand asked what would happen if society’s most talented businesspeople got so fed up with being taxed, regulated and otherwise messed about by government that they went on strike. Innovation would cease. The economy would stagnate. And government, starved of easy pickings, would become more bullying.

The world’s fifth-largest economy is in the early stages of its own experiment with driving Atlas crazy. Since the Thatcher revolution of the 1980s Britain has been one of the most open and business-friendly large economies. It is the biggest recipient of foreign direct investment in Europe. It ranks seventh in the World Bank’s index of ease of doing business. It has the world’s most liberal corporate-takeover rules.

Britain continues to benefit from this regime. Unemployment has hit a 42-year low, at 4.4%. Google is preparing to build a campus for 5,000 employees in London’s King’s Cross district. But the settlement is under assault from two directions. The Conservative Party is negotiating Britain’s departure from the European Union, disrupting long-established flows of trade, talent and capital. Meanwhile, the main opposition party is led by a hard-leftist who wants to consign Thatcherism to the dustbin of history.

Brexit is already beginning to damage Britain’s most globalised industry, finance. Most big investment banks have shifted some people and operations to the continent as a hedge. A trickle could become a flood when the City realises that the EU is unlikely to allow Britain to have its cake and eat it. Oliver Wyman, a consultancy, predicts that up to 75,000 finance jobs, or 7% of the total, will leave if Britain loses easy access to the single market. EY, another consultancy, puts the figure at 83,000. Demand for London houses costing over £2m ($2.6m) is beginning to sag, while the market for such homes in Paris and Frankfurt sizzles.

The Brexit effect is extending to a range of other industries, from talent-intensive ones, where people can decide where to work, to capital-intensive ones, where companies are loth to make investments if they are uncertain about the future. The number of foreign graduates seeking jobs in Britain has fallen by 12% since the referendum, according to LinkedIn, a professional networking site. Investment in the car industry this year is on track to be less than half its level in 2016, and a quarter that in 2015.

Many Brexiteers regard temporary disruption as a price worth paying, for the reasons that Rand laid out in “Atlas Shrugged”. The EU is a giant bureaucracy that is more interested in regulating yesterday’s industries than inventing the future, they argue. Britain’s best chance of flourishing is to turn itself into a European Singapore and attract mobile industries.

An inspiring vision, perhaps, but it suffers from several problems. The first is that the EU is unlikely to allow a Singapore to form on its borders. Britain will face a choice between playing by European rules and getting access to European markets, or creating its own rules and being denied access to those markets. The second is that the cost of disruption could be very considerable indeed. Britain has a current-account deficit of around 3% of GDP. It also has an unusually large “gross” balance-sheet because it is a global hub for banks and holding-companies. This makes it sensitive to panics resulting from disruptions in the Brexit talks (such as one side walking out in a huff) or, worse, from Britain crashing out without a deal. The third and most important problem is the likely next prime minister. Where Singapore had Lee Kuan Yew, Britain will have Jeremy Bernard Corbyn.

Mr Corbyn stands on the verge of power. The Tory party is so demented that some members are rallying behind Jacob Rees-Mogg, a pantomime toff, to succeed Theresa May. There is little chance that Mr Corbyn would moderate his hard-leftism in government. He has been banging the same drums for 30 years, and is surrounded by fellow-travellers such as John McDonnell, his shadow chancellor, and Seumas Milne, his chief strategist, whose biggest disagreement is over whether Stalin or Trotsky is the greater inspiration. He is supported by snarling activists in the Momentum campaigning group and the Unite trade union.

The last straw

His election is likely to lead to the biggest test of strength between global markets and a sovereign government since François Mitterrand proposed an extensive programme of nationalisation on his election to the French presidency in 1981. Mitterrand was forced to back down, but Mr Corbyn may well hold out for longer. His politics are a deeper red than Mitterrand’s. He believes that change comes through conflict rather than consensus, so will expect the markets and media to tell him he is ruining the country: that’s what the reactionary establishment does. As heavily indebted renters, his young supporters may not mind surging inflation and crashing property prices.

The combined result of Brexit and Corbyn could be the dystopia that Rand warned about: a stagnant society driven by resentment of the successful. The flight of talent will not only have a knock-on effect on the wider economy, as high earners who would have spent money in London or Leeds start moving to Paris or Frankfurt. It will also reduce the state’s revenues, since the top 1% of earners pay almost 30% of income tax and the top 10% pay nearly 60%. Mr Corbyn seems to think that all he need do is to ask “the rich” to pay “a little bit more” and everything will be fine. But why would successful people put up with higher taxes, particularly if they follow on the heels of Brexit-related uncertainty and disruption? As Luke Johnson, a serial entrepreneur, points out, the world is full of places where Britain’s Atlases would be welcome, from neighbouring countries like France, which is courting London’s bankers and tech workers, to emerging markets such as Dubai and Singapore. When Atlas shrugs, the whole of Albion suffers.

Economist.com/blogs/bagehot