Casino capitalism has its attractions, but is not a game one should encourage young families with no financial reserves to play.

Yet the Government’s Help to Buy scheme is an invitation to enter the casino that is the British property market. It is more than possible that David Cameron and George Osborne will lure hard-working families of slender means into a gamble which for some will end in disaster.

What happens when interest rates go up, or house prices fall, or indeed both of those things? Will borrowers who were able, thanks to the Government’s offer to guarantee 15 per cent of a loan, to obtain 95 per cent mortgages, still be able to cope?

The Government’s response is to deny that a property bubble is developing. Kris Hopkins, the Housing Minister, said in the Panorama programme on Monday night, The Great House Price Bubble?: “We’ve seen nothing yet to suggest there is anything going anywhere near a bubble.”

Hopkins could be right. Only when we know what happens next will we be able to says with any certainty what is happening now. Tony Lloyd, head of policy at Shelter, agrees that “we cannot definitively say we’re now in a bubble”.

But given the way the British property market has behaved in recent decades, it would be absurd to claim there will not be another bubble. And Lloyd reminded me of two laws: “1. Every bubble bursts. 2. Intelligent people always say it won’t burst.”

Gordon Brown is an intelligent person who came to believe, or at least assert, that he had abolished boom and bust. Cameron and Osborne are intelligent people who believe, or at least assert, that their Help to Buy scheme will not further inflate a bubble which will in due course explode, with ruinous consequences for some participants.

Tory backbenchers are in private less reticent. “We call it Help to Vote,” one of them says. They compare what is happening now to the Barber boom set off by the Budget of March 1972. Exports and business investment are currently at disappointing levels. The Chancellor has instead launched a credit boom, aided and abetted by the cheap money policy of Mark Carney, Osborne’s appointment as Governor of the Bank of England.

Interest rates are at their lowest for 300 years. Whatever the obliging Carney may say and do in the five years he has consented to serve, they will not stay at that rate indefinitely. At some point, mortgages will become much more expensive, and we shall see whether lenders have taken a sufficiently cautious view of what the new borrowers brought in to the market by Help to Buy can afford.

Few if any economists have a good word to say for Help to Buy. It is a transparently political scheme. In the words of one Tory: “If we don’t do it, Miliband will toast us.”

The aim is to win the general election of May 2015 by showing that it is the Conservatives who are on the side of ordinary people who yearn to own their own homes. As Cameron, or one of his staff, said with unconscious condescension in an article for Monday’s Sun:

“Help to Buy is helping those people who I always knew it would — the people I’ve had front and centre in my mind from the start. It’s helping people like you, Sun readers. It’s helping hardworking people in our country who want to get on in life. Responsible people who work hard, put in the hours and can afford a mortgage — but can’t afford sky-high deposits. People like Kayleigh and Chris who I met a few weeks back. They both had good jobs, and had saved for several years, but still they couldn’t afford the deposit for a house. Now with Help to Buy, they are looking forward to their first Christmas together in their new home.Unbelievably, there are people who actually oppose Help to Buy and don’t want people like Kayleigh and Chris to get on. I’ll let you guess who they are. Yes, the same old Labour party.”

But many Conservatives oppose Help to Buy too. We think the way to help Kayleigh and Chris is to build many more houses. Instead of inducing Kayleigh and Chris to take out a perilously large loan, which will have the effect of giving public subsidy to high prices, we want to make houses cheaper, which as Mark Wallace pointed out on this site on Monday, means increasing the supply.  Socialist planning must yield to Tory freedom.

The idea of a property-owning democracy was developed as an answer to socialism. It is most closely associated with Anthony Eden, underlay Harold Macmillan’s achievement of building 300,000 house a year after the Conservative victory of 1951, and was carried forward with brilliant success in the sale of council houses under Margaret Thatcher after the Conservative victory of 1979.

The phrase was coined by Eden’s friend Noel Skelton, Unionist MP for Perth, in a series of pieces for the Spectator and then in a book, Constructive Conservatism, published in 1924.

Skelton saw that the Conservatives after the First World War could not respond to the rise of left-wing ideas and of Labour simply by defending the status quo.  D.R.Thorpe quotes, in his admirable biography of Alec Douglas-Home, what Skelton wrote:

“The basic institution is, today, democracy. It can be stabilised and maintained by being founded on property owning…there is, in truth, no other way…To develop in Britain a property-owning democracy – that, it is submitted, is at once the fundamental task of Conservatism and an objective for the nation consonant with its character and with the natural evolution of its life. That is Conservatism’s true answer to Socialism.”

An ambitious programme of house-building was needed to make the answer work, and Skelton in his address to the electors of Perth praised what Neville Chamberlain had achieved as Minister of Housing and Health in the Conservative Government of 1924-29: “The building of some 930,000 houses in the last four and a half years is a world record and has greatly relieved the Housing shortage in our cities.”

Skelton was a progressive, or what would now be called a moderniser. But modernity did not for him mean condemning people to a lifetime of crushing debt. Nor did he or anyone else pretend that home ownership was either possible or desirable for everyone. As Lord Lexden, the Conservative Party’s official historian, puts it:

“The post-war Tory vision of a nationwide property-owning democracy included a strong, socially responsible private rented sector to cater for those who were not ready to take on full home ownership, or who preferred to own shares rather than houses, an approach strongly advocated by ‘ Bobbety’ Salisbury who rebuked Eden for defining the term too narrowly. Macmillan agreed. “ We have got the houses up,” he said in 1955, “now we must get more private landlords.” Enoch Powell as junior housing minister swept away rent controls that hampered the market. When is this government going to display the imagination needed to implement one of the greatest of all Tory principles properly instead of driving the less well off into more debt?”

Fraser Nelson, editor of the Spectator, observes in a justly ferocious blog that Help to Buy alarms “any sane economic forecaster old enough to remember George W Bush’s sub-prime disaster or Brown’s debt bubble”, and goes on to quote this magnificent denunciation by Albert Edwards, head global strategist at Société Générale:

“Why are houses too expensive in the UK? Too much debt. So what is George Osborne’s solution for first-time buyers unable to afford housing? Why, arrange for a government-guaranteed scheme to burden our young people with even more debt! Why don’t we call this policy by the name it really is, namely the indentured servitude of our young people. I believe it truly is a moronic policy that stands head and shoulders above most of the stupid economic policies I have seen implemented during my 30 years in this business.”

There is something profoundly unconservative about burdening people with such a level of debt. I am not entirely averse to casino capitalism: it possesses a dynamism not often found in the more sober German way of doing things. But when I returned to London from Berlin in February 2000, I could not help noticing that a mad speculative boom was in progress, which any fool could see was going to end in tears, though nobody could say when.

Boris Johnson was at that time editor of the Spectator, but it was his wonderful deputy, Stuart Reid, who was perhaps most keen on the piece about London, headlined “A City of Spivs and Speculators”, which I wrote while still able to see the place with the eyes of a new arrival:

“The Germans are profoundly suspicious of Anglo-Saxon capitalism. They see it as unstable, fixated on short-term gain, ruthless in its disregard of the weak, a casino where reckless gamblers make fortunes overnight and honest toil counts for nothing. For them a free marketeer is a man who knows the price of everything and the value of nothing. Anarchic spivs and speculators rule the roost, people so blinded by the pursuit of profit that they are incapable of acknowledging any other obligation, whether to long-term employees and partners or to society and the environment.”

This does not fit Cameron and Osborne. They do feel a sense of obligation, including the obligation to help ordinary people to buy a house. But their behaviour makes it look as if the description fits them, for they hope to attain this goal by encouraging people of modest means to play in our national property casino, having bought the necessary chips on tick.

This is a very unhealthy thing to do, and suggests they have lost sight of what a property-owning democracy ought to be like.

Just as banking ought, for normal people, to be an unexciting activity presided over by respectable bank managers, so the market in domestic property should be as staid and stable as we can make it. When one buys a house, one should not suppose one is taking part in a get-rich-quick scheme. If spivs and speculators want to engage in that sort of behaviour, let them do so somewhere else.  For the Government to lure people on average earnings into that kind of thing is not just bad economics. It is immoral.