Conservative Reader Meet Up

We are hosting the first Conservative Reader Meet Up at 6.30pm on the 21st May at The Ship & Shovel Pub in Trafalgar Square, London. If you’d like to come along to meet other Readers, share ideas about future content and discuss the issues of the day, do come along.

Towering Columns

In The Times, Roger Boyes describes China’s strategy to become the new ‘rational’ lynchpin of the global order.

The Trump armoury includes investing in national champions — he is not leaving that to China — and a readiness to use force at home (in the form of anti-immigrant enforcement) and abroad. The sequencing of recent US military operations against the Iranian nuclear programme, then toppling Venezuela’s China-friendly dictator Nicolás Maduro and then bombing Iran’s regime should be seen as a Wagnerian hell-and-damnation prelude to the Beijing visit.

It has not, of course, shocked and awed Xi. Rather, he smells bombast (as well as bomb-blast) masking weakness. On a philosophical level it saps the US case for being the legitimate point-man for liberal democracy and undermines western cohesion. Hence the procession of western leaders visiting Xi, all eager to make nice. At least six of these recent visitors — Britain, France, Canada, Germany, Finland and South Korea — are formal allies of the United States. Xi will have drawn the conclusion, with a degree of smugness, that these leaders are on the search not just for lucrative contracts but for proximity to a restrained and rational player at a time of global madness. They help him make a point about China’s great power status and America’s retreat from responsibility.

The “madman theory”, a term notably coined by Nixon when he let it be known to the North Vietnamese that he would do literally anything to stop the war, keeps on being played though often with a cynical twist. Henry Kissinger worked it out early (“a madman who is holding a grenade in his hand has a very great bargaining advantage”) but Trump has used it too often against North Korea and Iran. The threat of “civilisational erasure” against Tehran, with its playful hint of genocide, is what shook Xi the most. China would see an open threat to its own cherished civilisation as existential.

For Engelsberg Ideas, David Cowan says we can learn from the national policy of 19th Century Canada about how to survive Great Power politics.

Britain and its European allies are in a situation altogether different to Victorian Canada. Yet in many ways the predicament is similar. Britain is navigating a course between two large entities, namely the EU and the United States, while trying to establish itself as an independent power. The decline of European industry has shown how vulnerable the West has become in the new age of great-power competition. There are undoubtedly strengths, such as British and French membership of the UN Security Council and their nuclear deterrents, as well as the broader institutional strength of NATO. But European hard power must be restored.

They can only do this by regenerating the manufacturing sector. Failure to do this will force Britain and other European middle-ranking powers into a submissive foreign policy that follows the whims of Washington, Beijing and Moscow. But they can realistically follow Macdonald’s example and rebuild themselves as prosperous and sovereign middle-ranking powers. Macron’s decision to expand the French nuclear umbrella and Merz’s rearmament plan are encouraging signs. But there is so much more incredible potential that can be tapped in London, Paris and beyond. It requires a blend of economic nationalism and political moderation.

The current historical moment demands a renewed National Policy. At the heart of Macdonald’s vision was the realisation that national power depended on productive capacity. Canada was able to build its industrial strength and, in turn, make the sovereignty promised by Confederation into a reality. Canada is also an instructive example of successful nation-building that should inform European elites in national capitals as much as in Brussels. Europe must now guard against the immense power of China as the world’s largest manufacturer as well as rebuild its defences against Russia. Navigating between the squabbles of great powers has been done before by middle-ranking powers. It is an art that must be mastered again.

For The Financial Times, Oren Cass argues that America should say ‘no deal’ to China and resist its quest for global economic dominance.

As US President Donald Trump visits China this week, his administration appears torn between the need to decouple and the desire to strike a grand bargain. This is nothing new from America. During the Biden administration, the Commerce and Treasury departments consistently pressed for a more open economic relationship with China while the National Security Council insisted on greater restrictions. Trump has pursued dramatic escalation in some instances and warm conciliation in others. Tariffs on China briefly reached 145 per cent in early 2025 and the White House sought to block sales of even the outdated AI chips that Biden had approved for export.

Less than a year later, Trump was offering chips that Biden would not and suggesting that the US should welcome 600,000 Chinese university students. Biden’s goal was to persuade, cajole or, if necessary, drag China towards increased globalisation and greater international co-operation. Trump believes that China has been “ripping us off” and that through economic coercion he can get a better deal. But the Chinese Communist Party is not possessed of a deeply held liberalism just waiting to be teased out by a US suitor. It is an illiberal regime that sees no advantage in supporting an open global commons. Likewise, China’s heavily protected, state-controlled economy is not an attractive opportunity just waiting to be tapped by American firms.

In the late 1940s, many who harboured utopian theories of world government were sure that integrating Stalin’s Soviet Union into their plans could work. Those who opposed US involvement in conflicts overseas saw the end of the second world war as the perfect time to withdraw. Neither course would have been wise.

For The Critic, Christopher Snowden describes how our command and control capitalism is throttling the economy.

This is not just a story of bad laws and unintended consequences. It is not about the suffocating levels of regulation in every area of economic life, although much could be said about that. This is something different and, I think, new for this country. An activist state is systematically coercing the private sector in the pursuit of a range of social engineering goals, all of which are implicitly assumed to be more important than the economy. It is a form of central planning, albeit with a patchwork of different plans rather than one overarching goal. Some of them have explicit targets. Net Zero by 2050 is the best known of them, but there is also the plan to go “smokefree” by 2030, to “phase out” petrol and diesel cars by the same year, and to decarbonise the electricity grid by 2035.

To meet such targets, recent governments have tightened their grip on the private sector. At the softer end of the scale, they require businesses to make commitments to political goals before they can produce anything. The Procurement Act (2023) contains various “social value” requirements that oblige firms bidding for public contracts to demonstrate progress on Net Zero, diversity, apprenticeships and so on. Developers are forced to add solar panels to all new builds and make a certain proportion of their houses “affordable” (who is buying the rest?). The planning conditions for the new runway at Gatwick include the stipulation that at least 54 per cent of passengers must use public transport to get to and from the airport, a strangely specific demand for something that a builder cannot control.

At the harder end, the government makes threats and delivers punishment beatings. In a fully socialist system, state-owned motor companies would simply stop producing the internal combustion engine in 2035 and politicians would take the blame. In Britain’s command economy, the Zero Emission Vehicle Mandate requires manufacturers to sell a certain number of electric cars. The mandatory number rises each year and companies face fines of up to £15,000 for each petrol or diesel vehicle above their quota. Similarly, when he decided that there would be no new gas boilers in Britain by 2035, Johnson introduced fines for companies which failed to sell enough heat pumps. Again, there was a target: 600,000 new heat pumps a year by 2028.

In The Telegraph, Ambrose Evans-Pritchard says that our nimble approach on nuclear fusion shows we do not need to re-join the EU.

In short, the UK has created a fusion ecosystem in concert with the Americans that is now reaching critical take-off. It is becoming a fusion superpower in its own right. Would this have happened under the inertia of EU membership and faced with endless squabbling over the division of spoils?

Fusion is not a minor matter or a technological luxury. The global energy and economic system will be changed forever the day that the first megawatt from a fusion reactor hits the grid at a competitive cost. The rewards will be immense. It is unfashionable to credit Boris Johnson or Sir Keir Starmer for anything in our petulant society but both deserve a few hurrahs for this at least.

There may be many compelling reasons for the UK to tie its fate closer to the EU – or, indeed, to rejoin – but please stop telling me that higher economic growth is one of them. Listening to insular Labour backbenchers bleating piously about a Europe that exists only in their heads is worse than enduring the hideous noise of fingernails on a blackboard.

For The Times, Paul Goodman says that we must get tougher on our enemies at home in a new insecure age.

Ministers have promised to scale up the government’s specialist disruptions unit to detect, expose and counter extremist influence across the UK. But a more systematic approach is required, modelled on the education reforms introduced by the Conservatives, developed by Labour, continued by the Coalition and preserved in essentials to this day. Just as Ofsted was put in place to monitor school standards, so a new counterextremism regime should be established based on inspections, fines and enhanced rights to sue.

The universities and the arts were identified as problem areas in a Downing Street seminar last week. Are Jewish students being harassed while university authorities turn a blind eye? Widen the Office for Students’ inspections remit, fine the institutions concerned and, if necessary, hold vice-chancellors and principals personally liable. Are artists subject to silent boycotts by venues? Let a new ombudsman investigate.

The Best Value regime, which requires local authorities to seek continuous improvement, should include councils’ response to antisemitism. An “extremism duty”, modelled on the “Prevent duty”, is required for prisons where Islamist gangs, in some cases, rule the roost. Above all, the Charity Commission needs new powers to suspend trustees and shut down charities, with funding barred from specific states, organisations, groups and individuals approved by parliament. An inspections regime wouldn’t be a cure-all. Nothing can substitute for effective border control, swifter prosecutions and deportations where necessary. The government promises to keep foreign preachers of hate out of Britain. It should also act against those who are already here: the time has come for some speakers in mosques to be prosecuted for stirring up religious hatred and incitement.

For The Telegraph, Sherelle Jacobs argues the country is beginning to rebel against big budget welfare socialism.

Blaenau Gwent – the poster child of benefit-addicted Britain – has started to rebel against its fate. This should send a powerful message to Labour. With the welfare bill set to exceed tax income by the end of the decade, benefit dependency is the single greatest challenge facing the country. Yet Keir Starmer looks set to leave office without even attempting to grapple with it. The reason that no senior Labour politician is willing to put their head above the parapet is that the party’s MPs are convinced that they have a moral obligation to protect the benefits of the vulnerable. But the shifting mood in places like Blaenau Gwent suggests that this view is sentimental and out of touch.

It is true that the people of Blaenau Gwent do not particularly blame or resent those among them living on benefits. But there is a growing understanding that welfare socialism is horrifically damaging to the very people it aims to help.

Places like Blaenau Gwent are often labelled the shame of Britain. But spending time there this week as the Labour leadership psychodrama unfolded, it struck me that it is Westminster that has become the stain on the nation. If there’s one thing people need to understand through the current chaos, it is that Britain itself isn’t broken; it is being failed by an embarrassing excuse for a political class.

Subscribe now

Wonky Thinking

On his Substack, Rian Whitton lays out how we have been doing industrial strategy wrong and that we cannot just focus on supply-side reforms, but need to ensure that we build up British businesses that are able to be effective partners for industrial renewal. This means policies that effectively target and support critical industries and retain domestic capability.

British industrial policy fails partly because it tries to promise everything to everyone. Decarbonisation gets mixed with regional redistribution, which gets mixed with job creation, which gets mixed with desires to be an innovation superpower in the most speculative technologies, with quantum computing being a clear example. What never gets defined is what size the industrial economy should be, how much growth can be expected, or what share of employment and output manufacturing should represent. We have a panoply of desires with no clear mission.

Instead, small amounts of money are spread thinly across the country, with little willingness to make difficult decisions about where industry should actually be concentrated. Because Britain’s housing market is so constrained, policymakers rarely even consider large-scale internal migration towards productive industrial regions. Instead, struggling areas receive scattered subsidies with no broader strategy behind them.

The UK also misses another key component of industrial policy. It only works in the context of a wider political economy. In Taiwan, China, Japan, Germany and Sweden, industrial policy is directed through a partnership, implied or otherwise, between the government and powerful domestic industrial conglomerates. In many cases, the industrial elite of those countries have power and political influence far exceeding that of British billionaires. The Wallenbergs of Sweden, the myriad industrial foundations in Germany, the keiretsu and the chaebols all continue to wield significant influence.

Industrial policy is often seen as an alternative to markets and the power of the wealthy. The truth is that successful industrial policy is historically a compromise between the wealthy and their societies; you are given government support, protection and priority, and in return, you invest domestically and think beyond immediate shareholder returns. To some, this is a grubby relationship, but we already accept it on a small scale, whether it’s Anthony Bamford’s donations or the government supporting Jim Ratcliffe.

Britain no longer has many large, domestically owned industrial firms capable of competing globally. Our car industry is now almost entirely foreign-owned. This may help headline productivity figures, but foreign firms generally prioritise their home markets and domestic supply chains. So to summarise, much of our industrial policy is flawed. However, it is also worth noting that supply-side reform has already been enacted, and the more ambitious elements of it are politically contentious.

New research by the Energy Institute at Haas by Lucas Davis has found that the shale gas revolution has saved the US economy nearly $5 billion since 2007 through providing cheaper energy and reducing dependence on more expensive imports. The paper demonstrates the importance to the economy of securing domestically produced supply of energy.

It may seem like a distant memory now, but back in the mid 2000s, U.S. natural gas production had been flat for a decade, and the U.S. was importing liquefied natural gas (LNG), with plans to import much more. As of February 2007, for example, there were four additional U.S. LNG import terminals under construction and another 10 U.S. LNG import terminals had received approval from FERC.

Then shale gas happened. Advances in hydraulic fracturing and horizontal drilling opened up vast new areas to development and dramatically increased U.S. natural gas production. Figure 1 plots monthly U.S. natural gas production. Since Daniel Yergin and Robert Ineson wrote about “America’s Natural Gas Revolution” in the Wall Street Journal in November 2009, U.S. natural gas production has approximately doubled, driven overwhelmingly by shale gas. Along the way, the United States went from being a net importer of natural gas to the world’s largest exporter. The United States has been the world’s largest LNG exporter since 2022, and in 2025, the United States exported 9 billion Mcf of natural gas.

This paper calculates how much shale gas has saved U.S. natural gas consumers. We first compare natural gas prices in the United States, Europe, and Japan. Prices diverged sharply in 2007, just as shale gas was accelerating. The paper then uses these price differ ences, together with information about U.S. natural gas consumption, to calculate various measures of savings. The paper finds that U.S. natural gas consumers have saved $4.5-$5.3 trillion since 2007, equivalent to $237-$276 billion annually.3 Incorporating demand elasticity the savings are $164-$189 billion annually. These large savings reflect that the U.S. natural gas market is very large.

U.S. natural gas consumers now use 30 billion Mcf of natural gas annually. Combine this high level of consumption with price differences that have averaged $9-$11 per Mcf, and it makes sense that the savings from shale gas would be very large. The paper then examines the pattern of savings across sectors and geography. Natural gas consumers include electric power, industrial, residential, and commercial. We find that 38% of savings went to electric power customers, with 30%, 19%, and 13% for industrial, residential, and commercial customers, respectively. In terms of geography, Texas has saved more than any other state, and Louisiana has saved the most per capita.

Subscribe now

Podcasts of the Week

On The Critic Show this week, Graham Stewart, Henry Hill and Tom Jones debate whether “Britain is done” through a combination of unsustainable welfare spending and a lack of an alternative vision.

OUTPOST

What has become of Britain?

May marks the beginning of summer, and this month Tom, Henry and Graham are here to talk you through May’s edition of The Critic, leading with the question of whether Britain has any vision left…

Listen now

14 days ago · 7 likes · Outpost

Subscribe now

Quick Links

DWP has increased welfare payments for polygamous households.

Henry Jackson finds that 574 ‘sectarian candidates’ were elected councillors last week.

New Energy Independence Bill will ban new oil and gas drilling in the North Sea.

Implosion of Market Financial Solutions costs UK and US lenders over £1bn.

Historic British business Tate and Lyle subject to £2.7bn US takeover bid.

The Royal Household’s grant is to be cut by the government.

The Prime Minister faces leadership challenge from Mayor of Greater Manchester.

Conservative Reader Meet Up

We are hosting the first Conservative Reader Meet Up at 6.30pm on the 21st May at The Ship & Shovel Pub in Trafalgar Square, London. If you’d like to come along to meet other Readers, share ideas about future content and discuss the issues of the day, do come along.

Towering Columns

For The Telegraph, Sherelle Jacobs argues that London no longer offers a clear route to a better life for the young.

But now that dream has lost its sheen. The American dream is based on a promise that if you work hard, you’ll make it. The London variation promises those who are willing to put up with high rents, stress and crowds, the prize of better career opportunities and a more exciting life. But this compact is breaking down.

Londoners on higher wages used to have more disposable income than their fellow Britons to splash on fun and fine things. But surging rents have terminated this advantage. When housing costs are factored in, the average London household income is now estimated to be lower than that outside the capital.

A generation ago, settling down in London was a perfectly reasonable lifestyle choice. Things have changed. Almost 60 per cent owned their home in 1991; today that is down to around 45 per cent. Everything from expensive childcare to family-unfriendly homes is creating a hostile environment for those planning to settle down. Career prospects for strivers are dwindling. As AI slashes the graduate job market by a third, it is more difficult than ever to get one’s foot in the door.

In Conservative Home, Arthur Reynolds writes that higher taxes and costs for pubs risk cutting off a route into work and skills for many young people.

Both Gordon Ramsay and Marco Pierre White grew up on council estates, and a number of young people who walked into our pub from humble beginnings have gone on to achieve great things. A lad who started washing dishes at 16 – incredibly shy and unsure where he wanted to go in life – is now the Head Chef at a Michelin-starred restaurant, attending glamorous award ceremonies and hanging out with the country’s best chefs.

I was studying for my A-Levels when he turned up, dreaming of university and the bright lights of the city: he’ll make more money as a great cook, and make more people happy, than I ever will tapping away behind a desk.

Another who began as a teenage waitress went on to become a hostess on luxury yachts – living a life many could only dream of. Some have travelled the world as private chefs, others have stayed local, using their skills to command good wages (many a chef earns more than their employers) and get on the property ladder. Without pubs, and the opportunities they offer, none of this could have happened. In their determination to squeeze every ounce of tax from them, Labour risks breaking an industry that offers a lifeline to thousands of young people who know the classroom isn’t for them.

In The Critic, Fred de Fossard argues that new rules raise risk creating a legacy of fewer jobs and homes for the young.

That is the sad reality of an overregulated economy: small and medium-sized businesses are squeezed out of existence, many unable to shoulder the burden of complying with new laws. Those who do remain in the market have to take a number of steps to reduce their risk. For example, if a landlord is unable to terminate a tenancy or increase the rent at the end of a contract, it is likely that the overall rate of rent will increase to mitigate this. There are already reports of prospective tenants being vetted for their character and financial circumstances before securing a room to rent. These are undoubtedly unpleasant things to go through, especially for young people at the start of their working lives. But if the law imposes huge new risks and costs on landlords, it should be expected that these costs are eventually passed onto tenants.

A flexible labour market and a flexible rental market are two fundamental components of a market economy. They are also vital for young people who want to start working and start building independent lives of their own. A meme has swept X called “Londonmaxxing” recently. In some respects, this is a charming online tribute to London as a place to live, to eat and drink, to innovate and to work. It has become especially popular among those who are bullish on London’s future AI economy. It is a nice idea. But if the people who make Londonmaxxing a reality cannot either find a job in the city or a room to rent, there will be nobody to max out what the city has to offer. The Employment Rights Act and the Renters Rights Act will erode the flexibility which makes economic activity and prosperity possible, and we will all pay the price. For some, the bill is arriving in their letterbox already.

For The Telegraph, James Johnson argues that Zack Polanski’s poor approval ratings set the Green Party up as a radical non-mainstream force.

But what if that is not the Green Party’s goal? A fall in mainstream support might not hurt Polanski if the real aim is to be an insurgent radical-Left party that can win, say, 50 seats. In fact, it may even help his cause. For there is a phalanx of radical-Left voters, making up around 15 per cent of the voting public, who will quite like what he says.

In a YouGov poll last year, Green voters were the least likely to favour custodial sentences for a number of crimes. For a criminal who attacks someone with a knife, they favoured a shorter prison sentence than any other party’s supporters.

The Greens’ position may also appeal to a significant number of British Muslim voters, one in four of whom in key population centres around the UK are planning to vote for the party at the next general election. One reason is their position on the conflict in Gaza, a bigger driver of vote for British Muslims than the economy.

A recent Policy Exchange poll with JL Partners found that one in four British Muslim voters had a positive view of Hamas. As many as four in 10 British Muslims believe the Jews have too much power in society, and almost half support banning all Israel-built technology from the National Health Service.

On Substack, Neil O’Brien argues that high asset prices mask weak public finances and that when conditions shift, the state will have less room to respond.

At Spring Statement Reeves got a £5bn windfall from assumptions about CGT increasing, which helped offset some of the extra spending she has announced since the Autumn.

Some of the growth is from Reeves’ own tax increases (like the family farm tax and family business tax) - and some from an assumption that the assets she is taxing will keep on going up, while frozen thresholds for IHT and stamp duty drag more and more into paying. (This is “fiscal drag.”)

That’s why Reeves will be keeping her fingers crossed for increases in asset prices - if anything happens to them her numbers will start to unravel in a big way. This is a kind of “fiscal fragility”.

This isn’t just inflation - these taxes are also increasing as a share of GDP. Stamp duties have long been about 0.5% of GDP, but are going up about half that again to 0.77%. Having been in a range of 0.15 to 0.25% GDP over recent decades inheritance tax is forecast to increase to 0.40%. The three taxes taken together will have gone up by about three quarters of a percent of GDP from 2024 to 2030/31.

For The Telegraph, Guy Dampier argues the current framing of migration understates its impact and this misleads the public.

Critics have raised concerns. Freezing out the courts won’t necessarily prevent them from challenging these measures, which could cause delays even if Parliament exercises its sovereignty. To remove the numbers promised requires a tenfold increase in the detention estate and very little operational friction. In many cases those who arrive illegally destroy their identity documentation, making it hard to work out where they are from. Even when we know, their home countries may refuse to take them back.

These are not insurmountable problems, however. Visa sanctions will encourage recalcitrant countries to take back their nationals. Those whose origin cannot be identified can still be removed to a third-party country, the threat of which may be enough to encourage them to leave or seek a voluntary return, as many have done in the United States. Building more detention estate rapidly is perfectly feasible when the NHS was able to build a 4,000-bed Nightingale Hospital in just nine days.

Such a large volume of removals will upset some, as mass deportations have in the USA. It has to be remembered, however, that this is a necessity. If it were not for mass breaches of our borders, then mass deportations would not be necessary. Any politician unwilling to do so is in effect saying that they will condone illegal arrivals, as well as the costs and crime that go with that. Only a rigorous response will create a deterrent capable of ending mass attempts to enter the country illegally.

In The Times, Juliet Samuel argues that we should copy the Gulf states in their approach towards Islamism.

I reject the dissolution of my tradition and I reject Brenton’s suggestion. Instead, I suggest, given that Islam is now an enduring feature of British civic society, we ought to study the way modern, functional, Muslim countries stamp out its pathological variants. The governments of Morocco, the UAE and Jordan, for example, all deploy some combination of mosque and imam licensing, theological guidelines and sermon vetting. The UAE, which no longer funds students coming to Britain because of the risk of campus radicalisation, even regulates donations and study sessions.

You might ask how such practices are consistent with hard-won British freedom of religion. Manifestly, they are not. The tussle between state and religion in Islamic countries has not generated the same settlement as in Christian countries and there is no reason why we should have expected it to.

We have to develop a new way of policing ideology in our country, one that is more sophisticated and interventionist, which roots out, and where possible, deports, promoters of strife and the networks that enable them, yet which preserves as many of our liberal norms as possible. As a minimum first step, we should urgently stop importing and naturalising people who harbour ideologies we don’t want.

Subscribe now

Wonky Thinking

Policy Exchange has published a new report which examines the new emerging trend in British politics of ‘Islamopopulism’. JL Partners polling surveyed over 1,000 British Muslims and found differing views from the rest of Britain’s population on issues like gender segregation, Gaza, and the presence of dogs in public spaces.

In addition to populist movements of the right and left, Britain faces a growing populist movement among its four million Muslims. This highvoting faith group, once 80 per cent Labour, is turning in far greater numbers to alternative candidates across a range of parties who are willing to issue a communal appeal. Among Muslim voters of Asian origin, Labour’s vote share dropped by 28 percentage points between the 2019 and 2024 general elections – a remarkable fall in five years1 – and, as our polling shows, is set to fall further. Four independent candidates were elected to Parliament in 2024. Others missed out only narrowly. Many hundreds more are standing at this month’s local council elections.

While less secular and more communal “independent” candidates are the movement’s most prominent standard-bearers, Islamopopulism is also finding a home in the Green Party and Your Party. And two new, interlinked national bodies, The Muslim Vote (TMV) and Vote Palestine, have arrived on the scene. These seek to direct Muslim voters to the candidates most able to “punish,” in TMV’s words, Labour and the Conservatives. At the recent Gorton byelection, in a seat nearly 30 per cent Muslim, TMV backed the Greens and no independent Muslim candidate stood. The Greens won with a significant Muslim vote.

Policy Exchange’s programme is dedicated to understanding Islamopopulism: its goals, its methods and from where it draws its supporters. Such scrutiny has hitherto been turned upon right- and leftpopulism, but to a much lesser degree on Islamopopulism. What does Islamopopulism want? How far does it fit the classic populist template? How much does it reflect the actual views of British Muslims? Are the independent candidates really independent, or are they working together? Is TMV a “Muslim Momentum,” a central organising body akin to the Jeremy Corbyn fan club? What links has the movement to Islamism and other movements hostile to democratic values? What are the issues, values and policies they are seeking to advance, and how far do they align with the views of the majority in this country?’

Subscribe now

Podcast of the Week

In The Spectator’s Quite Right! podcast, Michael Gove and Madeleine Grant discuss the increasing normalisation of antisemitism in Britain, and how populist forces on the left of British politics seek to exploit this for their own gain.

Subscribe now

Quick Links

Chief Executive of South East Water quits after supply chain issues.

Chief of organisation funded by Arts Council shares Golders Green conspiracy.

Britain pays Norway £20bn a year for North Sea oil and gas.

Chinese spies attempt to silent dissidents in Britain.

Nurse who lied about qualifications ordered to pay back £278.

Starmer pledges to stay on as PM after Labour defeats in local elections.

Conservative Reader Meet Up

We are hosting the first Conservative Reader Meet Up at 6.30pm on the 21st May at The Ship & Shovel Pub in Trafalgar Square, London. If you’d like to come along to meet other Readers, share ideas about future content and discuss the issues of the day, do come along.

Towering Columns

On Substack, Neil O’Brien writes about how radicalisation of our campuses is shaping growing levels of political violence.

What’s really happening is that these universities are being pushed around by militant staff and students. For example, UCL’s branch of the University and College Union passed a motion calling for “intifada until victory” shortly after the Hamas attacks. UCL’s “Director of equality, inclusion, and culture”, Addeel Khan, is a trustee of Save One Life UK, a charity under investigation for links to Hamas.

What does this culture mean in the real world?

Zahra Farooque, who graduated from UCL in 2021, was charged with aggravated burglary, criminal damage, and violent disorder for targeting an arms factory. UCL neuroscience student Mohammed Nasser was arrested after allegedly assaulting a pro-Israel demonstrator in Brighton. Qesser Zuhrah, 20, was studying social sciences at UCL before being arrested over alleged offences linked to the activities of Palestine Action. These problems have been going on for a long time. In 2009, Umar Farouk Abdulmutallab, who had run the Islamic Society at UCL, attempted to detonate explosives on a flight from Amsterdam to Detroit.

Nor is it confined to UCL. The Office for Students reported 70 cases of Islamist radicalisation cases in higher education institutions which were escalated to Prevent officers in the 2023-24 academic year. This represented a 75% increase on the previous year.

For The Telegraph, Jonathan Goldstein says that we must summon the courage to tackle home grown radicals.

A country’s strength rests on shared standards – on a clear sense of what is acceptable and what is not, and on the confidence to enforce those boundaries consistently. When those standards begin to blur, the consequences extend far beyond any one group.

They extend, too, to how Britain is seen from the outside. Reputation is not built on rhetoric but on lived reality. When countries such as the United Arab Emirates begin to question whether it is safe to send their students here, it should give us pause. When businesses and investors start to factor social instability into their decisions, it becomes an economic issue as much as a social one.

We should be clear: this is not about inflaming division or assigning collective blame. It is about recognising that radicalisation, in any form, cannot be ignored simply because it is uncomfortable to address. The longer we defer that conversation, the more entrenched the problem becomes.

In The Times, Sebastian Payne documents the growing political extremism and antisemitism in the arts and culture.

On Monday, a new report was launched in parliament by Freedom in the Arts, a campaign group, to tackle “the new boycott crisis”. It states that 77 per cent of the almost 200 artists surveyed have either directly experienced or witnessed boycott-related activity.

Their research argues that there was a problem before the October 7 terror attacks on Israel, but it has ramped up significantly since. Something has gone badly wrong in the arts sector, it says, with an ecology based on talent, artistic judgment and meritocracy replaced by one of fear, and informal or direct sanctions.

Freedom in the Arts argues that artists are being targeted not for their political beliefs but simply for their identity, with Jewish artists facing “wave of boycotts”. It notes that many have been “accused of Nazism, Zionism or moral complicity [in Israel’s conduct] simply by virtue of their heritage”, something that would be lambasted as discriminatory were it another ethnic group. The most disturbing thing is the perniciously quiet way that this censorship is happening: those who do not voice correct right-on views are treated as “suspect”; cancellations happen behind closed doors without any process; and boycotts gather rapidly online. And then there is self-censorship, those artists who decline to publicly say anything heterodox because it risks disrupting their careers. A previous survey by the campaign group showed over half of nearly 500 artists said they did not feel they could speak freely on social and political issues.

Meanwhile, for The Times, Richard Morrison highlights the loss of arts and culture for local communities.

Kent is not the first council to venture down the slippery path of flogging its family silver to make ends meet. In 2013 the London borough of Croydon auctioned off its collection of Chinese ceramics for £8 million. The following year, in a notorious deal, Northampton borough council sold a 4,000-year-old Egyptian statue to a private buyer for £15.8 million, even though it had been donated to the council expressly so it could be displayed in public. More recently Hertfordshire, Derbyshire and Cambridgeshire have also sold hundreds of artworks.

But until now the vast majority of local authorities have shown an admirable resolve to uphold the principle that their collections, often donated by people who wanted everyone to enjoy their art, should be sources of civic pride, not financial assets to be flogged when times get tough. That civilised view is now under attack. Two years ago the Taxpayers’ Alliance published a paper asserting that the UK’s local authorities possess, between them, nearly two million artworks valued at £1.5 billion. As only 28 per cent of this hoard is on public display at any time, the Alliance argued, councils facing huge financial pressures should “assess what they do and do not need to hold on to”. In other words, they should turn paintings languishing in dusty storerooms into hard cash and use that to pay for essential services…

The works in storage may be valued at a certain figure for insurance purposes, but that doesn’t mean they will fetch this price if sold in a desperate dash for cash. There are horrible stories that suggest some local authorities (including Kent) may have bundled together dozens of fine prints or paintings and auctioned them all for a few hundred quid…although local authorities are technically the owners of these artworks, they are really holding them in trust for their communities, and especially for generations yet to come. In Maidstone, for instance, the art students and schoolchildren of the future will no longer be inspired by the very tangible link to Gormley that Two Stones provided for so many years.

In The Telegraph, Robert Buckland argues that threats against our elected representatives is warping our political debate.

For generations, when it comes to our relationship with our elected representatives, we in Britain have taken pride in what many other countries regard as an unusually direct and personal link. MPs continue to hold open constituency surgeries, walk our streets without escorts, cultivating the impression that politics in the United Kingdom is accessible. Yet that settlement is now increasingly under strain.

This week, the deteriorating situation was brought into stark relief by the disclosure by Nigel Farage MP, Reform leader, that continuing and serious threats to his safety led to his acceptance before the 2024 election of a private donation to cover the costs of his own security. Assaults by milkshake might seem amusing to some, but the reality for Mr Farage and many others is that this is the tip of a very large and frightening iceberg.

Not only does his own security dilemma call into question how we protect MPs other than the most senior government ministers, but it asks fundamental questions about how public life itself functions, who chooses to enter politics, and how democracy at all levels is experienced by voters. As large parts of Britain go to the polls in devolved and local elections next week, and campaigns and candidates actively seek election, this question is even more topical.

In Conservative Home, Katie Lam argues that we are failing to protect those that serve to protect us.

The previous Government legislated to put a stop to these prosecutions. This Government plans to repeal those protections, and throw open the doors for a whole new wave of lawfare. They are so determined to do this, they have even made it one of only two bills carried over from this Parliamentary session to the next. They insist that this is necessary, because the protections put in place by the last Government are not compliant with the Human Rights Act, or our obligations to the ECHR.

But if protecting our veterans from vexatious prosecution really isn’t compatible with ECHR membership, this only strengthens the case for leaving the ECHR altogether.

The action taken by our security forces in Northern Ireland was necessary, in order to keep us safe. The same is true of the action taken by those who are currently serving across the world. Their ability to take that action relies on the knowledge that, if they have acted according to instructions given to them by the British Government, then the British Government will give them full support in future. It is, in other words, a relationship which relies on trust.

The Government’s plan to repeal the Legacy And Reconciliation Act totally undermines that trust. So it is no surprise that, as a result, many currently-serving SAS soldiers are resigning. Who can blame them? When they can’t even rely on the support of their own Government, and may face decades of legal harassment in future, why would they take the kind of risks that they’re being asked to take?

For The New Statesman, Andrew O’Brien writes that we have given up trying to pay for our standard of living.

The Sterling Crisis and IMF Loan of 1976 are perhaps the most misunderstood economic events in recent British history. Columnists and politicians love to reference them, particularly in reference to the current Iran crisis and our own beleaguered Labour government. But they barely understand the events they’re describing. The point is not that our current crisis is the same as then, despite some passing similarities. In fact, in many ways, the current crisis is worse than 1976.

The reason why is simple. We cannot afford our current standard of living. We do not produce enough of what we want – or enough of what the rest of the world wants – to pay for the things we cannot produce ourselves. Add on top of that a global economic crisis, like the US-Iran war, and the economy begins to buckle. As the world scrambles to secure fuel supplies, food, fertilisers, plastics and other essentials in its wake, we will struggle to secure our own supply. Even if we do so, we will have to sell off more of our businesses, our property, our future tax revenue to pick up the bill.

We have allowed ourselves to get into this position by forgetting the iron law of international economics: every country must pay its way. Ensuring this was the goal of politicians like Jim Callaghan and Healey. This is what maintaining our balance of payments meant in practice. It is the very heart of what it means to deal with the cost of living. And it has been forgotten by our current political class.

In The Times, Juliet Samuel argues that the right needs to stop relying on outdated theory and embrace national economic renewal.

The question is, when a third of the world’s goods are produced by an economy run on the basis of “Marxist-Confucianism”, can you actually claim to be operating according to the natural laws of the free market? Or are you in fact just participating in the role of global “capitalist” chump — a “non-player character”, as the video game wonks put it — in some weird power struggle of sub-regional Communist Party officials with production targets to hit…

But beyond its practical consequences, the ultra-liberal analysis also has limited explanatory power. An honest reading of economic history disproves the absolutist theory that the state is always bad at picking and developing winners. Nuclear power, mass vaccine production, space shuttle development, semiconductors, solar panels, car-making: all have relied at different points upon the might of government research, subsidy or procurement to grow. And in all sorts of cases, strategic government support has led to the emergence of genuinely competitive companies that end up trouncing global rivals. That’s before you even enter into the debate about how various savings and fiscal policies favour or hinder particular industries.

Unfortunately, neither the Tories nor Reform are close to formulating a coherent world view. Reform is throwing out sporadic promises of nationalisation, but policymaking is still stuck at the stage of working out who owns the keys to the whisky cabinet. The Tories are doing some work on fiscal and energy policy, but have neither the attention span nor the cash to expand beyond that. If this work doesn’t happen, we’ll just end up with contradictions and truisms about the extraordinary innovative power of markets. But a right-wing programme for the economy needs to incorporate the way things actually happen, not the way the old theories say they should. There is, in short, more than one way to boil a pot.

Subscribe now

Wonky Thinking

The Prosperity Institute has published a new paper with a draft bill on repealing the Human Rights Act and returning to the traditional constitutional settlement with accountability located in Parliament rather than the courts.

We envisage two primary effects of withdrawing from the Convention and repealing the HRA 1998. One is that public authorities will be able to discharge their functions in ways that are presently unlawful because they are incompatible with the Convention rights. Two is that there will be a significant reduction in the grounds upon which individuals and corporations can challenge the exercise of state power.

The result is that it would become easier for public authorities to take many decisions, to take them quickly, and they would face a lower probability of judicial scrutiny. This would extend the capacity of those public authorities to take positive, or at least popular, decisions in a timely fashion. It would, however, also expand the scope for them to make significant, perhaps grave, mistakes. Some of those mistakes would not be easily susceptible to ex ante or ex post judicial inquiry without the HRA 1998 in place.

Were our Bill to be enacted, the United Kingdom would return to something closer to its historic, Diceyan constitution in which there are no limits on Westminster’s parliamentary authority. In such a constitution, the political accountability mechanisms of Parliament take on decisive importance. The capacity and willingness of parliamentarians to question, probe, expose, deny, censor, and direct the executive, its agents, and the wider emanations of the state would become the central protection against excessive and authoritarian government.

We are presenting this Bill for two reasons. The first is to raise public understanding that withdrawal from the Convention, and repeal of the HRA 1998, is not a purely mechanistic process and involves significant policy choices.

The second is that the policy ambitions of Labour, Reform UK, and the Conservatives, particularly their commitments to improve deportation rates of those individuals deemed ineligible for asylum or humanitarian protection in the UK, will continue to be difficult to achieve for so long as the HRA 1998 remains on the statute book.

The Social Democratic Party has published a new Green Paper calling for the return of an investment state. This would shift spending on social security towards building new homes, energy infrastructure and return to the post-war levels of public investment. The paper argues that this would significantly increase living standards and boost productivity.

Prior to the mid-1970s, British government spending on public investment roughly equalled that spent on entitlements and cash transfers to households, with each item constituting 6% of GDP. However, in the subsequent fifty years, successive British governments have averaged just 1.7% of GDP per annum on public investment, and 10.2% on entitlements.

This reallocation of government spending – what we call the shift to the entitlement state - has caused a long-term, secular reduction in British productivity growth. The cost of this long-term fall in productivity growth has been momentous. We estimate that British output per hour in 2024 would have been 90% larger had this shift not taken place, representing an increase in 2024’s Gross Value Added (GVA) from £2,500bn to £4,900bn.

We argue for a reallocation of government spending towards a pattern that better resembles pre-1975 levels: at 6% of GDP per annum on public investment, and 6% on entitlements.

To avoid the patterns of economic mismanagement that derailed the pre-1975 system, we propose the creation of an overall body for national economic development called the Department of Economic Planning (DEP). The DEP will pursue targeted five-year plans that use public investment to resolve supply-side constraints facing the British economy and create the conditions for long-term growth, such as infrastructure investment, housing, and industrial coordination.

We name this new mode of economic management the investment state.

To achieve the investment state, we will need to realise a significant reduction in current entitlement spending. To achieve this, we propose a ten-year “taper” period which will see spending on the state pension reduce by £4.9bn per annum, disability and incapacity benefit by £3.8bn per annum, and housing benefits by £3.7bn per annum.

To illustrate the power of the investment state at resolving structural crises in the British economy, we present three five-year plans by the DEP focused on housebuilding. Using half of the proposed entitlement savings, we detail a plan to expand national housebuilding capacity to build 4.3mn additional homes within fifteen years.

In total, we project that the higher productivity growth achieved under the investment state will increase national income significantly over a thirty-year period. By 2055, it will increase national income by nearly fifty percent – from £3,040bn under the current trend to £4,440bn.

Subscribe now

Podcasts of the Week

In The Spectator’s Reality Check podcast, Michael Simmons and John Power discuss the Green Party’s policy on drugs and have decriminalisation could lead to a rise in drug deaths and create broader social problems.

Chris Bayliss, Henry Hill, and Nigel Biggar discuss on The Critic Show the questionable historic justifications for the Church of England - and Britain more widely - to pay reparations for actions of the past and what it means for modern Britain.

OUTPOST

The Reparations Game (FULL EPISODE)

This week on The Critic Show, Chris Bayliss and Henry Hill are joined by the Anglican priest, historian and ethicist Nigel Biggar…

Listen now

a month ago · 2 likes · Outpost

Subscribe now

Quick Links

The Joint Terrorism Analysis Centre has raised the national threat level to Severe.

The Act of Union came into effect today, 319 years ago.

Total government spending on course to be 60% of GDP by 2073.

The number of Channel boat crossings has reached 70,000 since the General Election.

Investigation has found multiple instances of antisemitism in local election candidates.

Canadian Armed Forces platoons with over 80% non-Canadians descend into infighting.

Towering Columns

For The Times, Patrick Maguire calls time on a Starmer Ministry that has been sustained by the collective denial of The Cabinet.

It is not just that ministers are giving up on Starmer. His premiership has always been sustained by a collective suspension of disbelief, so they did not have very much to give up in the first place. What is different, and new, is that they no longer feel they owe the prime minister the courtesy of hiding it. It is not as if he is in the habit of putting his colleagues first, so why bother defending the indefensible? Starmer cannot sustain the fiction of his own authority alone. When cabinet ministers are privately despairing to the chief whip of their leader, as at least one did this week, the die is cast.

But these ministers cannot conscientiously object to the political consequences of their inaction, just as Starmer has for six long years. Soon they will have to act. As one cabinet source says: “It’s all f***ed in fast forward.” So unbearable is the status quo for a critical mass of ministers that a new consensus is taking shape: that, once the scale of electoral devastation his leadership is wreaking on the Labour Party is made clear next month, Starmer should be made to set out a timetable for an orderly transition, with a new leader in place for conference.

It would be a fittingly mild flavour of regicide for Starmer’s Labour Party: procedural, bloodless and probably too late. But it suits all players. For Miliband, Angela Rayner and Louise Haigh — the soft-left powerbrokers who hold the whip hand over the prime minister — it buys time to chart Andy Burnham’s course back into the Commons. It spares any one ambitious minister, not least Streeting, the fate of James Purnell. And it would permit the prime minister himself another six months or so of gladhanding on the international stage.

In The Spectator, Patrick West writes that the flag of St George has become a symbol of resistance to rampant cosmopolitanism.

In recent times, the flag has unquestionably assumed more political connotations. But contrary to Starmer’s assertion, one that reflects a mindset endemic in metropolitan circles, it has not been hijacked ‘to spread hate’. It has been deployed in great numbers by a class of people in this country who feel they have been consistently ignored, denigrated and traduced over the past thirty years. There would be no proliferation of St George flags on lampposts, pavements or on the front of houses and pubs today had not the English people been remorselessly insulted and belittled by a cosmopolitan Anywhere class, and one in hock to a lopsided version of multiculturalism.

This is an echelon that is untroubled by the sight of Palestinian flags fluttering on street corners, one which enthusiastically celebrates cultures, all except the indigenous one of England. This is an entitled class which is apt to smear without distinction anyone with old-fashioned, sensible or moderately conservative views as ‘far right’.

While it’s true that the St George’s flag is sometimes flown by xenophobes and racists, for the majority of English people who aren’t of this persuasion it has become more a symbol of resistance and defiance. It’s a flag used to convey discontent with a detached class that has ignored their plight and dismissed their concerns, to one which continues to parrot platitudes about diversity while turning a blind eye to its manifest defects, to a ‘two-tier’ Keir who seemingly cares about some sections of society more than others. In that regard, Starmer is unwittingly correct. The St George’s cross has become a symbol of ‘unity’. It has united under one banner great swathes of the populace who don’t like him or how his people have treated them.

For The Critic, Henry Hill questions whether Starmer has truly failed given the lack of any governing project.

And on one level it is a stupid question. He is failing. What follows is not an exercise in clickbait contrarianism. The statement “Starmer is failing” strikes me as just as intuitively correct as it does everyone else. But on another it is a very interesting question indeed. Because if Starmer is failing … at what?

Seriously, what is he trying to do? One could say “governing”, I suppose, but that is so broad as to be rather a cop-out and when you try to define governing, it isn’t obvious that he’s actually attempting it. The Government’s agenda has devolved into a Labour backbencher’s Christmas list, individual enthusiasms — hiking welfare, hiking the minimum wage, hiking taxes, hiking regulation on housing and employment — pursued without any apparent reference either to the national finances or to the Prime Minister’s stated intention to go “hell for leather” for economic growth.

Perhaps the Starmer project, whatever it was, has simply failed already, buried when mutinous backbenchers broke the back of his Chancellor and forced a u-turn on welfare cuts? But this confuses cause and effect. The Prime Minister lost control of his MPs so quickly because he hadn’t prepared them for unpleasant realities, nor furnished them with a plan which might justify pain today with glory tomorrow. Absent any programming, his historic majority simply reverted to factory settings.

For The Spectator, Tim Shipman highlights the growing militancy of civil servants in response to calls for reform.

Insiders say the collapse of confidence of the civil service in the government goes back to when Starmer, in his first months, denounced civil servants wallowing in ‘a tepid bath of managed decline’. One said: ‘It was straight from the Boris playbook. Beat people up then try to tell them to reform.’

From the start there was disappointment. ‘Civil servants were optimistic about Labour,’ a former official says. ‘They were sick of the chaos. But quite quickly it was clear the government had no idea what it was doing.’ Even a Labour politico agrees: ‘The biggest problem is that Starmer didn’t know what he wanted civil servants to deliver.’

Officials did not conceal their disdain. One political aide says: ‘Some in the higher echelons of the foreign office regard themselves as Jeeves to the government of the day’s Wooster. And there are civil servants at all levels who make it clear you are just passing through. You can see it in their eyes. They’re like the Taliban: “You have the democratic mandate, but we have time.”’

The view of Starmer is astonishingly negative. ‘He can’t get the basics right of governing,’ says a former mandarin. ‘The senior leadership of the civil service are particularly acute at observing how well power is being wielded. They might not like it, but they’ll respect power being wielded. What you have is a prime minister who can’t set political direction. He can’t take his party with him and use his majority. And he won’t take difficult decisions. This guy delegates to a fault. He is becoming very well-known in Whitehall as the man who wants to avoid taking responsibility for decisions. He’s the man with invisible fingerprints.’

In The Telegraph, Kemi Badenoch calls on the Attorney General to resign in the wake of fresh allegations over the prosecution of Iraq War veterans.

So now we know. Keir Starmer’s closest ally in Cabinet and chief legal adviser led a witch hunt against brave British soldiers. Thanks to The Telegraph, we can see how Lord Hermer, the Attorney General, disgracefully sought to profit off the misery of decorated war heroes, using Iraqi militants claiming to be farmers, and hounded decorated war heroes through the courts for years. British soldiers were put through hell by Hermer and his team, before finally being exonerated in 2014. Hermer’s close associate Phil Shiner was struck off over the case. There was no censure or punishment for Hermer…

Of course, British soldiers should fight within the law. But hounding our veterans through the courts will have a chilling effect on our ability to recruit people to the Army. It is a brain-dead strategy at a time when the priority should be growing our Armed Forces.

Former Labour defence secretaries are pleading with the Prime Minister to increase defence spending. The long-awaited Defence Investment Plan is nine months late. But the Government seems to have no trouble finding time to harass our soldiers. These are serious times Britain is living through. War in Europe and in the Middle East.

It’s not just Labour. The Greens want to leave Nato and scrap our nuclear deterrent. The Liberal Democrats seriously think that more borrowing is an option while bond markets are wobbling. Reform hasn’t even bothered to appoint a defence or foreign affairs spokesman. The Conservatives’ shadow attorney general, Lord Wolfson, is representing veterans in the Supreme Court for free. That is the difference.

For The Times, Juliet Samuel writes that ideological complacency from officials has let Chinese interests to penetrate the British state.

It surely cannot hurt that Chinese companies hire our political elites and officials on wonderful salaries. Huawei at one point had in its pay the government’s former chief information officer (John Suffolk), a former head of the Foreign Office (Simon Fraser, via his PR firm Flint Global) and the former head of UK Trade & Investments (Andrew Cahn). A former No 10 chief of staff and Foreign Office director, Eddie Lister, helped China buy its mega-embassy site in London while being paid by the buying and selling side.

But these appointments don’t exist in a vacuum. Around them is a friendly network of legitimising organisations focused on promoting “links” and “engagement” with Beijing, chief among them the Great Britain China Centre. The GBCC is a Foreign Office-funded quango that holds snazzy receptions, takes MPs and retired judges on junkets to meet Chinese officials and “trains” civil servants on Chinese matters. It “partners” with Beijing institutions like China’s Supreme People’s Court and Ministry of Justice. This is a regime, lest anyone need reminding, that keeps hundreds of thousands of people in labour “re-education” camps, locks up petitioners in psychiatric hospitals and faces credible allegations of organ harvesting. What better way to “engage” than with a “legal roundtable”?

But what makes the GBCC particularly instructive of the Foreign Office’s attitude to risks posed by China is its choice of “honorary president” from 2015 to 2022: one Peter Mandelson. It was a job that gave Mandelson excellent networking opportunities. He was convening events in ministries and banks to introduce Chinese officials to British lobbyists, meeting executives from Chinese state-owned companies, leading delegations to China and so on. In other words, he was using the convening power and funding of the British state to build his contact book.

Subscribe now

Wonky Thinking

The Centre for British Progress has published new research on the adoption of AI and has found the UK is keeping pace the United States so far. However, the research has also found that the diffusion of AI has already started to have an impact on the jobs market, particularly in software development.

UK workers currently use AI across 385 distinct work tasks, roughly 2.1% of the 18,429 unique task statements identified in the O*NET database. These tasks range from the granular to the broad: drafting and proofreading legal opinions, adapting teaching materials to different types of learners, or tailoring sales scripts to specific customers are all distinct ONET entries. The same number for the US is 1,563, a considerable gap that largely reflects the size of the US economy. Countries with a larger number of users have more tasks that cross the threshold for inclusion in the dataset. This means raw coverage figures are not necessarily informative of the degree of adoption, because we cannot fully adjust for the size of a country.

Therefore, while the gap between the US and UK appears significant, in practice it is narrower than it appears: when the comparison is restricted to tasks adopted in at least ten different countries, both the UK and the US cover all of them. When expanded further to tasks identified in at least five different countries, the UK is second, with 94% of those covered. The UK largely matches the pattern of adoption for advanced economies across task types, but doesn’t have enough users performing less common tasks, to a significant extent because of its smaller population relative to the US…

Software illustrates the pattern in a microcosm. Employment in the computer programming sector (SIC 62) grew by 18% between 2019 and 2025, roughly three times the economy-wide rate of employment growth, while output grew even faster, at 36% over the same period. But both series turned down in the second half of 2025: employment fell 4.5% from its March peak, and GVA dipped from its Q2 high. While the sector remains well above its pre-pandemic level, the timing coincides with both a broader technology-sector correction and the introduction of tools like Claude Code that can automate large amounts of tasks.

Vacancies have fallen from their 2022 peak, and the overall composition of IT roles has shifted toward higher-level tasks. On the whole, the sector appears to have inelastic demand: AI-driven cost reductions are expanding the market for software rather than shrinking the overall workforce, albeit less slowly than output growth. These trends may have partly reversed more recently, a development which coincides with the release of, but there isn’t yet enough data to suggest either that it is a causal pattern nor a persistent one.

This data point is likely the strongest kernel of evidence of any displacement effects of AI, but it is complicated by that decline coinciding with a reduction in the GVA of the sector. We should be mindful not to overanalyse a single data point that may well be revised in subsequent releases, but it is clear that the data point that would most clearly signal the beginning of the displacement of output cannot be cleanly reconciled with an account of increasing productivity leading to higher output and lower employment.

For the Future of the Left, Blue Labour thinker Jonathan Rutherford writes an essay asking the simple question: what comes next after the collapse of the liberal market order which has been governing Britain (and the world) for fifty years?

We are living in the aftermath of the liberal market order which has been the governing consensus for over three decades. Its ideology and policy solutions no longer work in the emerging new world order characterised by great power rivalry and the rise of China. Its style of government, technocratic and incremental, has only reinforced the failing status quo in the West. In the United Kingdom, the Labour and Conservative parties which upheld this consensus are now trapped in the past. Their vote share is collapsing. A generation of politicians, schooled in a managerial politics, is unable to enact the change the country needs. They flounder in an unfamiliar and threatening world as the old multinational British state fragments.

Britain led the world in liberalising its national economy, deregulating the financial markets in 1986, and opening up to global flows of capital. In 2001, China joined the World Trade Organisation. With its vast pool of cheap labour, the manufacturers of western capitalist economies transferred their investments and factory production to the Guangdong Province and the Yangtze River Delta. The effects of globalisation lifted hundreds of millions of Chinese out of poverty while laying waste to the old industrial heartlands of American and Britain. President Trump and the rising power of China emphatically brought liberal globalisation to an end. The so-called liberal rules-based order so celebrated by the Financial Times and The Economist is an illusion.

The war in Ukraine, and now the energy crisis caused by the Iran war have exposed Britain’s continuing dependence on global supply chains and its vulnerability to global capital flows. For Britain, indebted to the bond markets, there are no easy routes to national economic recovery and no political party willing to make the case for them.

We can identify political, economic and cultural elements of this change, but we do not yet have a way of describing the emerging world we are living in.

Post-industrial, postmodern, post-Marxist, post-liberal: these explanatory frameworks do not describe what is here now and shaping the future. The German philosopher Karl Jaspers calls this kind of liminal state a ‘boundary situation’, which pushes us to the margins of our living experience and forces into consciousness the open-endedness and instability of the world.

Subscribe now

Podcast of the Week

Yanis Varoufakis and Wolfgang Munchau discuss on UnHerd’s Econoclasts podcast the state of Western Europe’s dependence on US and Chinese technology as well as Russian oil and gas. They argue that these geopolitical and technological weaknesses will force European countries to make a new deal with Russia in order to secure access to cheap energy supplies.

Subscribe now

Links

The United States considers dropping support for the Falkland Islands.

British workers were hit by heavier tax rises than in any other rich country last year.

The Bank of England says that stock markets are overvalued and set to fall.

Business costs jump by 5.4% in wake of Iran War signalling higher inflation to come.

Internal Green Party projections say that migration could increase to five million a year under their policies.

Catholics now outnumber Anglicans two to one amongst Gen Z and millennial churchgoers.

In The Telegraph, Tom Harris says the Mandelson vetting row has become a test of Starmer’s honesty and authority, because either he misled Parliament or his government failed to tell him crucial facts.

The Prime Minister’s constant parroting of his determination to put the country’s best interests first – as if he were the first holder of the office to realise that’s what the job has always been about – has put him in a bear trap of his own making. And the oft-shared video of Starmer telling an applauding audience that “I never turn on my staff, you should never turn on your staff” has gained a wider reach in the wake of his sacking of two chiefs-of-staff at Number 10 and now Robbins.

Given that he knew of his boss’s repeated commitment to putting the national interest before everything else – even before the desire to appoint a political celebrity from a bygone era to a senior diplomatic post – would it not have occurred to Robbins that allowing the Prime Minister to go ahead with Mandelson’s appointment against the advice of our security services might not comply with his stated principle? If the appointment was, in the view of security officials, not in Britain’s national interests, is that not a pertinent piece of information that should have been shared with at least one minister?

Instead we are asked to believe that this was known only to Robbins, who thought it best to withhold it from Starmer, and the rest of the Government, including his own boss, the then Foreign Secretary.

In The Critic, Aleks Eror argues that despite a change of governing party, policies implemented in Hungary may not change much.

Little is known about the incoming prime minister. He claims to be a conservative and there’s good reason to believe him. A former mid-ranking civil servant in Orbán’s once-dominant Fidesz party, he was reportedly passed up for promotion by the party hierarchy multiple times until he eventually lost patience and quit in February 2024 while going public with allegations of corruption against a number of Fidesz insiders. He launched his political campaign the following month, promising to clean up Hungarian politics and also mend relations with the EU. Since then, he’s served as a perfect blank canvas onto which all of Orbán’s critics could project their hopes and dreams.

This has led to a weird situation where he has been portrayed as some sort of democratic freedom fighter by both the liberal media and Brussels elites alike, even though he promised to keep Orbán’s big beautiful border fence, refused to comment on Fidesz’s attempted cancellation gay parades last year, and expressed only lukewarm support for Ukraine — all while wearing traditional folkloric shirts that would probably be described as “white nationalist” coded by the #FBPE crowd. The only reasonable assessment of Magyar at this moment is that he’s an unknown quantity and that we can only speculate about his true convictions and how they will affect Hungarian politics.

For now, the only thing that is likely to change is a shift in tone from confrontational illiberalism to a more restrained patriotic conservatism because Magyar’s focus will be on purging state institutions of Fidesz appointees so he can rule with a free hand and unlock some €18 billion in frozen EU recovery and cohesion funds that Brussels withheld from Orbán. His response to Budapest Pride this summer will be a possible indicator of just how far he intends to dismantle the Orbánist state. State officials with Fidesz loyalties are almost certainly doomed, but the Hungarian capital could yet remain a bastion for rightwing think tanks and networks that will help sustain Fidesz-style populism as a political force in the long run.

In The Telegraph, Guy Dampier illustrates how one obscure case in Diego Garcia displays the ineffectiveness and impracticality of Britain’s asylum system.

They began by trying to process the asylum claims, with Home Office asylum interviewers “seconded” to the authorities and the cases reviewed by independent reviewers, who were mainly retired judges and barristers. However, a legal challenge by lawyers in London against the process led to it being withdrawn, all negative decisions revoked, and the whole thing having to begin again. For three long years the migrants were stuck there, in a camp costing British taxpayers over £108,000 a day.

The asylum seekers were housed in military tents on a site nicknamed “Thunder Cove”. They leaked and soon ended up infested with rats. There were sexual assaults and harassment, as well as hunger strikes, suicide attempts and self-harm. Some asylum seekers had to be sent to Rwanda for medical treatment. Others chose voluntary return. The total cost rose into the tens of millions, with the Foreign Office warning it could rise to £50m a year. Attempts to restrict the asylum seekers from leaving the camp, to prevent them wandering into the base, have been ruled illegal, meaning that compensation is likely to be paid.

Following the general election in 2024, 39 of the asylum seekers were granted humanitarian visas to come to Britain, although this did not constitute permanent settlement or recognition of their refugee claims. When this was announced in the camp, most of the single men who were not granted these visas began to self-harm, some in front of children. There were also two suicide attempts. This blackmail worked, with the visas extended to cover 61 of the 64 remaining migrants. Those excluded were the three who had criminal convictions.

In UnHerd, Andrew O’Brien outlines Britain’s unique vulnerability to external economic shocks and why this means American threats matter.

Trump is not stupid. He knows that Britain needs easy access to American markets to sustain its fragile economy. Keir Starmer also knows this, and has said that he wants to get closer to Europe to reduce dependence on the United States. This is to misdiagnose the problem. The British economy needs America precisely because of its imbalanced trading relationship with the European Union.

There are three great trade powers in the world at present: the United States, the European Union and China. Britain is currently running trade deficits with two of them: China and the European Union. The British economy is importing £42 billion more from China than it generates in exports. The deficit with the European Union, however, is more than twice as large and stands at just under £90 billion a year. The only major success in terms of trade is with the US, where Britain’s surplus currently stands at roughly £73 billion.

In essence, the problem is that Britain can sell services very easily to the United States because of cultural, linguistic and historic ties, but it is much more difficult to sell them to the EU. On the flip side, demand for European goods has never been greater. This has nothing to do with Brexit but with the country’s dependence on Europe’s energy and goods while solely selling services. In 1999, Britain’s trade deficit with the EU was £11 billion, but by 2015 it had reached £69 billion.

For Conservative Home, Bob Seely says Britain risks being crippled by hybrid warfare because political leaders still think too slowly about defence.

It’s very likely that China and Russia have malware in the UK’s critical national infrastructure. How do we know? Because China has done so on the US grid and the US has been public about the problem: hidden kill switches in solar panels, persistent access to the US electricity grids and hackers embedded into the US infrastructure. Russia has also embedded itself into US systems; in the highly significant 2020 SolarWinds cyber-attack, Russia maintained a persistent presence on US government servers for months. If they have done it in the US, they will have done it here.

Any sustained cyber-attack, potentially backed up with physical sabotage of the system, might knock out the grid for days, weeks or months even. Worse, it may be controlled by others with the ability to turn it off and on.

Most people are not prepared for a world without electricity; no lights, no heat, and for some, no cooking. Our just-in-time supply chain is designed for speed and efficiency, not resilience. The average person stores three days of food. Within a few weeks food might have to be rationed. We saw panic buying at the start of Covid, especially in large urban centres. How long would social cohesion survive? Judging by the rampaging mobs in south London, we seem to have enough difficulty keeping law and order even in times of plenty.

For The Telegraph, Danny Cohen highlights the serious threat posed by the Green Party.

There is no doubt that many voters have lost faith in the mainstream parties that have dominated British politics over the last century. Their failures in government, along with a sense that the UK is stagnating, have led growing numbers to feel they have nothing to lose, that they may as well roll the dice and try something different.

But there is more to it than that. Gaza has clearly been a driver of Green Party support amongst the disgruntled far Left and some sections of the Muslim community. The Greens have a lot more to say about a war taking place thousands of miles away than any issue that would improve the day-to-day lives of British people. But do these pro-Gaza voters also want to legalise Class A drugs and prostitution? Have they taken a proper look at the policies they would be supporting?

Increasingly, voters appear to be ignoring what political parties actually say they plan to do. It’s dangerous and the consequences could be far-reaching for us all.

So if you don’t want to tank the UK economy, if you believe Britain should have borders and you are not in favour of legalising heroin and crack cocaine please think carefully before voting Green. This is no joke. The future of our nation may depend on it.

In The Telegraph, Ian Acheson describes how our weak institutions helped make the Rudakubana tragedy possible.

Prevent, the very scheme that should have escalated this kind of case to urgent intervention by others, was treated as a box-ticking exercise. Rudakubana was referred three times, but each referral was prematurely closed because he did not fit the neat category of a clearly defined terrorist ideology. The inquiry shows officers following processes while missing the point: a dangerous young man obsessed with violence, whose ideology was incoherent but whose trajectory was obvious. Compliance with paperwork became a substitute for professional curiosity and moral courage.

Mental health services fare no better. The inquiry describes emails never answered, assessments delayed for months, and a specialist high-risk children’s service that never saw Rudakubana because he fell between bureaucratic stools. His autism diagnosis became a reason not to act decisively on risk, as if neurodiversity were a shield against serious intervention rather than part of a complex, dangerous mix. Time after time, professionals accepted the most comforting interpretation of his behaviour and moved him on.

Layered over this is a suffocating ideological capture. In children’s services and mental health, the language of vulnerability and trauma has crowded out an honest recognition of dangerousness. Rudakubana was seen through the lens of “a child in need”. I heard this mantra repeated at a gathering of Home Office officials and NGOs convened ostensibly to encourage reflection after these ghastly events. The result is a system exquisitely sensitive to causing offence, soaked in the lexicon of piety and compassion but strangely numb to the potential and actuality of mass murder.

In Conservative Home, Sarah Ingham argues France now outperforms Britain militarily because it spends smarter, plans better and takes sovereignty more seriously.

France is, in corporate-speak, Britain’s peer competitor, but recent events are highlighting its defence superiority.

Defence procurement in Britain is currently synonymous with wasting time and money. The current defence crisis raises many questions, not least why France is apparently getting more bang for its buck – or should that be plus bang pour l’euro?

NATO’s former longstanding target of spending 2 per cent GDP on defence is a rough guide to an alliance member’s commitment to investment in national security. In 2024, Britain spent 2.28 per cent and France 2.04 per cent. In 2024/25, Britain spent £60.2 billion on defence: last year the Ministère des Armées’ budget was €61.8 billion. (£53.7 billion at yesterday’s rates)

France’s Armed Forces’ regular strength was almost 200,000 in 2025: in January, Britain’s was 143,560. France has one aircraft carrier to Britain’s two, but in most other classes – frigates, destroyers, corvettes – it has more ships. A database for military geeks suggests the Armée de l’Air et de l’Espace has 988 active aircraft, the RAF 640.

An in-depth study by Britain on how France’s Armed Forces are getting more for less is now urgent. Le Crunch last month was the final, thrilling, match of the Six Nations. Le Crunch Nouveau is French vs British defence.

President Macron alluded to the “reordering of US priorities” in relation to NATO. Should the US leave the alliance, it will be like the current exodus of the world’s wealthiest from Britain: celebrated by most in Labour, disastrous for the national bank balance as the capability gaps would need to be plugged.

Wonky Thinking

Policy Exchange’s new report on schools and gender safeguarding argues that far too many schools are still mishandling issues related to gender. It highlights that social transitioning is often facilitated by schools without informing parents, with unclear guidance facilitating inconsistent practices. The report calls for clearer guidance on gender in schools with clear statutory rules and stronger enforcement.

Nevertheless, in the majority of cases, schools adopted an inconsistent approach across the questions asked, meaning that vulnerable children were not always afforded the necessary safeguarding protections. For example, in cases of gender distress, some schools involved parents but did not inform the Designated Safeguarding Lead or a medical professional. Some schools involved some of the relevant parties but still adopted a broadly permissive approach to social transition, often indicating that they were struggling to balance their responsibilities to promote equality and provide anti-bullying and pastoral support with their safeguarding duties.

Moreover, the rights and interests of other pupils in school were not consistently upheld. Some schools required other pupils to accept a transitioning child’s new name and pronouns, potentially infringing on their right to freedom of expression. This was frequently justified on the basis of equality, pastoral care, or anti-bullying considerations. While most schools maintained single-sex toilets and changing facilities, many did not maintain single-sex sports or, if they did, only did for some sports. Schools often suggested that this was not a priority, instead indicating that decisions would be made on a case-by-case basis, with reference to safety considerations, but rarely to fairness, dignity, or privacy.

Most strikingly, a minority of schools continued to adopt a broadly permissive approach. 10% of schools did not inform parents when a child disclosed feelings of gender distress while also operating a policy of self-identification. In practice, this meant that some schools permitted a child to self-identify as a different gender and begin a social transition within the school environment without parental involvement. In such cases, vulnerable children may be denied access to multi-agency support and instead supported to begin a process of transition in school without full consideration of the potential risks or long-term implications. In these instances, contested beliefs about gender identity appear to have become embedded within school practice, shaping responses to vulnerable children in ways that risk compromising the effective discharge of safeguarding duties.

Podcast of the Week

Pollster Scarlett Maguire joined The New Statesman’s Anoosh Chakelian and Emily Lawford to discuss findings from Merlin Strategy polling that suggest young white women are becoming radicalised.

Quick Links

The COVID inquiry finds the UK’s vaccine rollout was an ‘extraordinary feat’.

The V&A changed catalogues at request of Chinese publisher.

A Jewish university student highlights growing antisemitism on campuses.

Prime Minister claims he did not know Mandelson had failed vetting.

The Chancellor u-turns and calls for a ramp up of North Sea drilling.

Towering Columns

In The Critic, James Jeffrey warns that we are forgetting the moral component of national resilience.

The UK continues to miss the wood for the trees. It frets over the size of its military. It frets over its lack of economic dynamism. It frets over the loss of civil liberties such as freedom of speech. All of these concerns are valid, but they pale in the face of the existential malaise that afflicts this country. The UK has no spiritual depth; it is a moral vacuum. The country’s default mode nowadays is flippancy and irreverence toward everything (we have always prided ourselves on our supreme “banter” that other nations can’t manage).

In her book The Need for Roots, the French writer, political activist and mystic Simone Weil wrestled with the question of why France fell so easily to the Germans at the start of WWII. Writing while exiled in London and working for the Free French movement, she said the country had crumbled because it had lost its spiritual dimension. As a nation, the French had nothing of depth and value to coalesce around; hence the Germans had walked all over them — while a sizeable number of the population willingly turned collaborator.

As others have noted, while the UK prides itself on its WWII performance, we never had to undergo the stress-test of how we would have responded had the Nazis managed to get boots on England’s soil. The English Channel saved us from having to face this uncomfortable question that confronted the French. I am not sure we would have done as well as we like to think. “What was everywhere, was moral incoherence,” Weil wrote of the state of France in 1940 when Germany invaded, noting especially the absence of “the spirit of truth” and the prevalence of “the spirit of vanity and falsehood”.

For The Telegraph, Jeremy Warner writes that the Iran War has merely strengthened China’s industrial dominance.

China promotes industrial development over consumption for a reason, and it’s not about to change tack. To the contrary, China has further doubled down on the mercantilism of its approach since Xi Jinping came to power. Economic resilience is routinely prioritised over growth in consumption and household purchasing power, with welfare made to take second place to industrial hegemony.

Government policy deliberately combines foreign asset accumulation, capital flow restrictions, currency manipulation, financial repression and other mechanisms that boost national saving but suppress consumption. Don’t knock it. If your objective is that of enfeebling the US and its allies while insulating China against the sort of supply chain vulnerabilities we again today see buffeting Western economies, it has been highly effective.

Trump’s war in Iran has further strengthened Beijing’s belief in the efficacy of its policies, and nothing the IMF says – eminently sensible and guided by the catastrophically destructive lessons of history though it might be – is going to change China’s view. Conversely, pursuit of economic resilience has indisputably been vindicated by current events. If Trump’s war in Iran were intended as a demonstration of continued US hegemony and military might, it has already largely backfired, having closed the Strait of Hormuz and exposed Western economic dependence on cheap Gulf oil and gas.

Western welfarism is in any case hardly an economic model you would want to follow. To the contrary, it is proving increasingly unaffordable and politically destabilising.

In Conservative Home, Miriam Cates makes the case for conservatives to tackle the triple lock.

Apparently without embarrassment, some conservatives complain that Britain’s benefit system is increasingly socialist – with growing expenditure on asylum seekers and those who don’t want to work – while being unwilling to contemplate reform to our most socialist benefit of all; the state pension. The same people who argue that disability benefits should only go to those who really need them seem remarkably comfortable with millionaires (one in four of today’s pensioners) and higher rate tax payers (three million retirees by the end of next year) receiving a state pension. Britain’s pension system now functions as a cash transfer from poorer young to wealthier old, in a reverse Robin Hood phenomenon that has become known online as ‘Boomer Communism’.

The delusion is so potent that it has led some to claim that those calling for pension spending restraint are ‘far left’. We really are flying upside down. Is it any wonder Britain’s young people are so demoralised? My eldest son turns 18 this year and, once he enters the workplace, a large proportion of the tax he pays will fund an income not just for poor pensioners, but for many who don’t need the money and are sitting on unearned asset wealth that he can never hope to acquire. If this is ‘capitalism’ then there are no prizes for guessing why young people might reject it.

In their press conference, the Reform Party pointed to polling that shows young people support the triple lock. But young people also support puppies and kittens; it doesn’t mean it will be a deciding issue for them at an election. And both Farage and Jenrick had some choice words about the apparently work-shy young, which is a bit rich considering they are the people who are being forced to fund a state pension that will be long gone by the time they reach old age. Campaigning for economic reform should not be the preserve of the radical left.

For The Critic, Henry Hill says that we must back the public to tackle petty crime when they see it.

We do need a stronger police response to “petty” crime, and a major prison-building programme to allow for the proper and effective punishment of serial offenders. But even if that could be delivered, retailers would need to be willing and able to confront and detain shoplifters long enough for the police to arrive; absent those conditions, businesses and individuals should have the law on their side if they choose to protect themselves against crime. Nor should we forget that our modern conception of British policing evolved in an era of much stronger social norms, and retailers having a zero-tolerance approach to crime is a step towards re-establishing those norms.

Finally, broader reform to liability law would also help to lift the burden on retail workers by making it easier for actual security staff to take a muscular and effective approach to tackling offenders themselves, and employers to build new security procedures that aren’t designed to minimise the risk of being sued by a criminal.

Retail workers brawling with criminals in the isles of our shops is nobody’s ideal world. But we should back them up when they do. It is a modern British vice to make policy fit only for an ideal world (perpetrator-centred, risk-averse) when we don’t live in one, and we are all poorer for it.

In The Telegraph, Eliot Wilson argues that the abolition of hereditary peers has left the House of Lords less able to challenge government.

When the House of Lords meets for the first time at the beginning of the next parliamentary session in May, it will be less independent than the House that Henry VIII faced in the 1520s. The arc of the moral universe really is long, but it is bending in an unexpected direction…

The Tudor House of Lords was made up of peers and prelates who owed their positions to a number of sources; it was no rubber stamp. How has the Prime Minister, 500 years later, managed managed to design a reformed chamber lacking that independence?

The answer is prioritisation. Last November, I described how the Labour Party had gradually shed most of its commitments to specific reforms of the House of Lords. It has focused on what it finds most obnoxious, the residual presence of up to 90 hereditary peers, 10 per cent of the total membership. Having eradicated the hereditary principle, the Government has scored a victory, and increased its powers of patronage. No other measures of reform are promised, merely nodded towards in a possible future; but what government truly wants to strengthen Parliament’s powers of scrutiny?

In Conservative Home, Peter Franklin say that the space race has shifted from a progressive to a conservative project.

Musk isn’t some idle theorist. He’s actually building the industries necessary in not one, but all the sectors needed to realise his vision: AI, robotics, satellites, solar power and, of course, launch systems. In the process, he’s already transformed the economics of spaceflight. Thanks to reuseable rockets and other innovations, costs have plummeted. In 2021 prices, the cost of using the Space Shuttle to lift each kilogram of payload into low orbit was over $50,000. But now, using the SpaceX Falcon Heavy rocket it’s less than $2,000. Unsurprisingly, the spaceflight sector is experiencing extraordinarily rapid growth — with 2025 another record year for launches. What used to be the most statist of human endeavours is now propelled by free enterprise.

So in that respect, spaceflight really is conservative and becoming ever more so. Perhaps that’s why parts of the Left are souring on what JFK called our “greatest adventure”. It’s not just the involvement of Right-wing billionaires like Elon Musk and Jeff Bezos that they hate, but the very nature of the underlying project. Academics and activists are now using the language of imperialism and colonisation to problematise mankind’s expansion into the rest of the solar system. The flaw in that critique, however, is the notable lack of indigenous populations for the folk back home to sympathise with.

So, no, the woke objections aren’t going to fly. The same goes for the environmental objections. Spaceflight is very much not carbon neutral and each rocket launch does damage the ozone layer — a genuine concern given the rapid growth in launches. But there is a solution, which is to explore space from space. In 2028 Artemis V is scheduled to begin the construction of a permanent base on the moon. By developing the dead worlds of the solar system — and the yawning voids between them — we have an opportunity to move every polluting industry from the only living planet that we know of. So environmental pain in the short term, in return for what could be the greatest possible gain.

In The Times, James Kanagasooriam argues that ‘Blue MAGA’ risks destroying the consensus that has built America’s prosperity.

A Democratic victory at this year’s midterms might reassure some within the party. It should not. Winning a low turnout election with an electorate that is more left-wing than a national election is not validation that a pivot to the left is a long-term path towards sustainable success. Trump won in 2024 because more voters than not thought he would keep America’s borders secure, and growth abundant; he won over about 80 per cent of voters who thought the economy was the most important issue and 90 per cent of voters who thought that immigration was the top issue.

The main significance of the rise of Blue Maga is that it threatens the broad but thinning pro-market and pro-business environment on which America’s prosperity is founded. One of the trends in US politics over the past decade has been Democrats edging closer to corporate America and Republicans growing sceptical of big business. Blue Maga threatens this balance. With more of the Republican base captured by anti-trust sentiment, a distrust of crony capitalism and private equity super-gains at the expense of ordinary Americans, Blue Maga v Maga may leave business out in the cold.

Americans who favour low taxes may be looking ahead to the 2028 presidential contest nervously. A debate over the balance between labour and capital could take centre stage, in favour of the former. In an age of tech billionaires and with suspicions about the super-rich friends of Jeffrey Epstein lingering, the contours are certainly shaping up that way.

Subscribe now

Wonky Thinking

The Great British Business Council’s new report on industry and energy supply identifies the continued critical dependence of the UK on oil, gas and coal. The report calls for Britain to change course in energy policy if we are to preserve what remains of our energy-intensive industries. Unfortunately, a wide array of legislation has embedded misguided climate and energy policies into law. The report calls for all this legislation must be unwound, starting with regulations and taxes that reduce supply.

Despite all the additional taxes and regulations on hydrocarbons over the last twenty years, 78% of the UK’s energy needs are still met by oil, gas and coal. Electricity accounts for only 22% of final energy consumption in the UK, and 31% of that was generated using gas in 2025.

It is unfortunate that successive UK governments have chosen to encourage companies to import just under half of the oil the UK uses, half of the gas it uses, and almost 90% of the coal (mostly used for industrial processes).

The UK also imports approximately 10% of its electricity. The UK is dependent on imports for more than 40% of its total energy, including 10% of its electricity, even though it has ample reserves of coal, oil and gas. This outcome also negatively impacts the UK’s balance of payments.

The sum total of the UK’s pursuit of Net Zero CO2 emissions has been to offshore energy-intensive industrial production at the cost of 100s of thousands of jobs, billions of tax revenues, higher imports and lower exports.

Of 195 countries, Britain is one of only 40 with ample hydrocarbon reserves of coal, oil and gas – while over 100 have no hydrocarbons and the remainder have very small reserves.

Oil and Gas is a significant but dwindling source of tax revenue, delivering £4.5 billion in taxes in 2024/25 – down 27% from £6.1 billion in 2023/24. Tax revenue is declining because tax rates are too high and allowance for exploration and development costs has been reduced. So producers are bringing forward decommissioning, lowering tax revenue even more.

Offshore oil and gas are taxed at 78%: comprising 30% ring-fenced Corporation Tax (set separately from the main rate of Corporation Tax at 25%), 10% Supplementary Charge, and 38% Energy Profits Levy.

200,000 UK direct or indirect jobs provide an estimated gross value added (GVA) of £25bn/yr, with PAYE/NIC contributions likely to exceed an additional £1bn/yr.

It is also estimated that unlocking additional resources from Britain’s coastal waters could add £150bn of gross value on top of the £200bn of economic value expected from current plans.

While this resource is being left in the ground, the UK endures higher taxes and annual trade deficits. Meanwhile, we import the coal, oil, and gas we need while exporting industries and jobs to countries that are happy to let their manufacturers use them.

In a detailed essay for UnHerd, Rian Whitton asks whether it is too late for Britain to reindustrialise.

At a sprawling Texan-owned oil refinery overlooking Milford Haven, an estuary town in Pembrokeshire, crude oil from America and Norway is distilled inside 200-foot steel towers. The oil is heated to 400℃. Hydrocarbons with low boiling points, like gasoline and kerosene, rise to the top of the column, while heavier chemicals like asphalt remain at the bottom. Out of the towers come the fuels that power cars, trucks, shipping, aircraft, and much of the chemical industry, not to mention almost all military vehicles. Britain was formerly home to over a dozen refineries. Yet the Milford Haven site is now one of just four refineries left in Britain, with two closing in 2025 alone, one in Scotland and another in Lincolnshire. Similar scars are borne by many towns and cities across the country. Just recently, we’ve lost production of salt in Runcorn, synthetic textiles in Brockworth, steel in Rotherham, bearings in Newark-on-Trent and ceramics in Denby. British Steel in Scunthorpe limps on, if only with government support.

It has been a steep decline. At the turn of the millennium, Britain possessed the fourth-largest industrial economy in the world. More than 800,000 people worked in foundational sectors: oil and gas extraction, refining, metals, chemicals, and inorganics. Contrary to popular belief, Britain’s energy-intensive production did not peak in the Seventies — but in 2002, supported by relatively cheap energy and booming global demand.

Then, between 2006 and 2008, Britain’s output and productivity began to fall. Globally, heavy industry shifted decisively toward China, hollowing out Western industrial employment. Britain, like its peers, lost jobs — but suffered more acutely. Heavy industry employment has halved from over 800,000 workers in the early 2000s to just over 400,000 today. Since 2008, Britain’s steel sector has nearly collapsed multiple times; the ammonia industry has died out; salt production has ended and aluminum production has rapidly declined. Production of cement and glass is down, while imports of the same materials are up. Those jobs were lost during a time of perceived economic and political stability, where countries would specialise and become ever more integrated. But due to tariffs, wars, pandemics and a general sense of insecurity, talk of reindustrialisation, once dismissed as pangs of nostalgia, is becoming de rigueur in Westminster. Robert Jenrick, who stands a good chance of being the next chancellor, has argued for “creating the conditions for Britain to reindustrialise, restore our proud industrial heritage and create good jobs for British workers once again.”

For different parties, “reindustrialisation” means different things. Ed Miliband envisages a “green industrial revolution” where Britain’s reindustrialisation is directly tied to his ambitious carbon reduction targets. For Nigel Farage, the term means cutting red tape and reopening the mines.

If reindustrialisation has cross-party appeal, it is because it intuitively makes sense that being able to manufacture complex equipment makes a nation stronger, more productive and more prosperous. This intuition has been tempered by economists who argue for economic specialisation and enjoying the reduced cost of goods by offshoring manufacturing to cheaper locations. But recent global events — Covid’s effect on supply chains; the Ukraine war’s effect on energy prices; the Iran war’s effect on shipping — have made this view increasingly hard to defend. Deindustrialised Britain grows its economy anaemically, if at all. The same is true of its productivity. As a result, the country’s hard power has rapidly diminished.

Hence the cheerleading for reindustrialisation. This high-spirited rhetoric rarely acknowledges tradeoffs, but it ought to. This is because deindustrialisation was a price willingly paid for cheaper consumer goods from imports, increased welfare spending, periodic tax cuts, and progress towards meeting Britain’s environmental and emissions targets — or, at least, those targets that pertained to onshore activity rather than activity handed off to the developing world. Reindustrialisation, then, might require some of those dividends to be relinquished. Partly for that reason, none of the cheerleaders have yet made firm commitments for how much of our economy should be manufacturing, or what level of growth they would aim for. Currently, the concept of “reindustrialisation” is comparable in rigour to “soft power” and “clean energy superpower”.

Subscribe now

Podcast of the Week

In The Spectator’s Reality Check, Economics Editor Michael Simmons argues that those on welfare are not enduring the cost-of-living crisis, with successive governments fiddling with prices and prioritising claimants. His work builds on Onward’s report The Hidden Bill which found that Universal Credit claimants can get up to £10bn in additional benefits.

Podcast of the Week

A third of our refineries closed down last year.

The number of patents filed in the UK has fallen by 50%.

Nearly half of children in migrant families are living in poverty.

Welfare spending has reached £333bn surpassing income tax revenue.

99% of the UK’s data transmission accounting for £1.15 trillion of economic output relies on just 60 undersea cables.

Claude Mythos causes cybersecurity panic by identifying vulnerabilities in every major operating system.

The CIA reportedly used secret quantum magnetometry sensors with AI that can detect human heartbeats to find missing US airman in Iran.

P.S.

Congratulations to long time Conservative Reader Editor Gavin Rice, who has now joined Nick Timothy’s staff as senior political adviser. Gavin will be taking a pause from the Reader for a while but we wish him every success in his new role.

Towering Columns

For The Times, Juliet Samuel says closer ties with the EU will not fix our fundamental problems.

Labour is not interested in models of success, however. It is plugging away with its dreary “reset”, promising to follow various sets of EU rules to no obvious benefit. Even the plodding Starmerites at the Institute for Government admit that “so far, the EU has done better at securing its objectives”. Well blow me down. It’s almost as if this is a mug’s game.

What, anyway, are we trying to achieve by reintegrating our legal system with a bunch of countries in exactly the same rut as us? Maybe it will do away with some passport queues and export hassle (or maybe not). But is it going to change our destiny? How is any of it going to help us do what’s necessary: replace half the civil service with AI, curtail legal delays, restore our dynamism, end reliance on immigration, and secure public support to spend less on welfare and more on industry, science and defence?

To do these things, you need a vigorous state free to tear up the rules, champion Britain’s strengths and take risks. Compared with the opportunity, the costs of Brexit are a rounding error. And with every new crisis, the need for radicalism becomes clearer.

In The Critic, Will Solfiac writes that an unwillingness to drop outdated ideologies is preventing necessary reforms at home.

One of the most bizarre characteristics of those who struggle to maintain what’s left of the liberal international order is their refusal to accept reforms that might head off its destruction. It’s not hyperbole to say that the entire rise of what is termed “right-wing populism” by its opponents stems from the unwillingness of mainstream political parties to control immigration. Considering that the continued growth of right-wing populism makes the position of the old liberal consensus ever more precarious, you’d think the latter’s defenders would have decided to compromise. Mostly, they have not.

And they could have; the forms of immigration that voters most strongly object to are also those which have the fewest practical benefits. If mainstream political parties had managed to shut down the fraudulent asylum system, enabled deportation of foreign criminals, and heavily restricted flows from countries where immigrants are particularly likely to be net drains on the state or to cause social problems, this would have taken a lot of the wind out of the sails of right-wing populist parties. Yet with the partial exception of Denmark, mainstream parties have been unwilling to do this. Currently, Shabana Mahmood is attempting to save Labour from electoral extinction by adopting aspects of the Danish model, but is being met with vociferous opposition from within her own party.

The reason for this unwillingness is, of course, ideology. It’s obvious that the asylum system functions primarily as a way for young men, and later on their families, to bypass formal immigration routes and achieve settlement in Britain. It’s also obvious that a disproportionate amount of the problems of immigration in general come from a few parts of the world. Yet maintaining the universalist, human-rights based legal infrastructure constructed after the Second World War takes priority over addressing these issues. The fact that this infrastructure was created for an entirely different world, where there was much less international migration, and where “asylum seeker” meant a political dissident from the Eastern Bloc, does not matter. The system’s advocates seem to live in a world made up of rhetoric, where principles take precedence over reality.

For Conservative Home, Katie Lam criticises those that want to close down the debate on mass migration.

Speaking at a panel event hosted by the Demos think-tank, Liberal Democrat MP Max Wilkinson said that “social media…is making sure that you can have your voice heard in a really easy way that you couldn’t in the past”.

He went on to argue that this is a “massive problem”, because it allows members of the public to highlight problems with mass migration. For Wilkinson, the issue isn’t the impact that mass migration is having on our public finances, or the healthcare system, or our communities. It’s that people can now freely express and debate their concerns.

This approach is frighteningly common in our politics. Far too often, politicians have tried to make difficult problems go away by encouraging people not to talk about them. In some quarters, there seems to be a genuine belief that real-world problems are conjured into being when people talk about them, and that problems can be made to disappear if only people would just keep their concerns to themselves.

In The Telegraph, Tom Harris warns that Starmer’s reset has echoes of David Cameron’s failed negotiations with the EU.

Previously, Starmer insisted that a firm cap on the number of citizens arriving in Britain from the EU must be set at a specific level. This was rejected by the EU, which nevertheless has accepted the need for an “emergency brake” on the scheme. This would focus on “the management of flows rather than an upfront number”, according to an EU source.

This has the whiff of David Cameron’s unsuccessful negotiations in 2016, when he returned from Brussels having had most of his own proposals for reform rejected by an EU establishment that clearly did not believe that the threat to British membership was real. Cameron had pleaded for radical change. His proposals included restricting immigrants’ access to benefit for seven years and preventing them from sending their (UK) child benefit payments home. This was a bridge too far for the Commission and so Cameron returned to Britain with a few very minor cosmetic changes to our membership terms…

If Keir Starmer really wants his reset to offer a taste of what life might be like for Britain were it safely back in the loving embrace of the EU, he needs to tread carefully. Evoking the days when Britain ceded control of immigration to the EU and forced UK taxpayers to pay for the privilege would be a perfect way not only to reignite the Brexit wars but to ensure Labour would once again be on the losing side.

On Substack, Andrew O’Brien argues that both the right and left have given up on our ability to fix our own problems.

For those of us living in the real world, our economic model was broken whilst we were in the EU. The EU was not the cause, but it certainly did not help check against poor policy decisions. Crucially, joining the EU does not offer any real prospect of fixing it, because it would not suit the other members of the EU to change our economic and trading relationships with them to our benefit at their expense. A closer relationship with the European Union would set in aspic all the economic problems we have today and perpetuate our slow economic and social decline.

Increasingly, in rooms where discussions about the UK’s economic future, the issue of European Union membership keeps coming up. My overwhelming feeling is that advocates for a closer relationship are just hoping that the EU will solve our problems because we are incapable of doing so. We are experiencing a profound crisis in faith: faith in our people, our culture, our businesses. They are hoping that a closer relationship with the EU will be a Tolkienesque Eucatastrophe - a sudden miraculous event that will save us. However, this is not merely a crisis for the ‘centre’ and the left. It is one that is shared in the right, except this time the target is the United States.

How many years were wasted after Brexit fawning over Donald Trump to try and get a ‘free trade’ deal with the United States, rather than actually fixing our problems? A deal that is never likely to happen and if it did, would be made under conditions of considerable disadvantage in negotiations and would likely see our domestic agriculture (and many industries) crushed in return for little. Moreover, when did a trade deal alone ever really solve anything?

For UnHerd, Jonny Ball says that we must adjust to the reality that we are now a developing country.

Rather than busying ourselves with the dead end of Gaullist posturing, in short, perhaps we should start thinking of ourselves as the developing country that, in many ways, we so obviously are. Certainly, financial analysts have already begun tempering their investments in Britain, a country now displaying the dysfunctional features of an “emerging market”. Rather than Anglo-Gaullism, then, surely a far better model is Anglo-Dengism. Echoing the Chinese example, Britain today should look inwards, focus on problems closer to home, build, develop, reform, innovate, and Make Britain Rich Again, before finally concerning ourselves with the global status games beloved of men-of-a-certain-age who played too much Risk as a child.

As the pro-market reformers of the Chinese Communist Party understood, following the privations of three decades of peasant communism, to project yourself abroad, you must “hide your strength, bide your time”. Before sending aircraft carriers to reopen faraway straits or threatening foreign regime, we must first become a country capable of raising real wages and living standards for our own British citizens.

Ernest Bevin once demanded a nuclear bomb “with a bloody Union Jack on top of it!”. The Anglo-Gaullists fancy themselves his heirs. But Bevin — and Glubb before him — knew that power had to be consistently built at home before it could be brandished abroad. Today, we are attempting a reverse Bevin: indulging in a fantasy of power without the necessary foundations, painting the flag onto imaginary weapons we no longer have the means to sustain.

In Prop Views, Jack Airey writes that the YIMBY movement needs to move beyond just planning reform.

A more effective YIMBY movement would take those market realities more seriously. So much time in government is spent discussing reforms that sound good in theory but run into difficulty when confronted with the economics of development. If campaigners want to help unlock delivery, they should be as interested in who will buy, rent and finance new homes, and on what terms land will come forward, as they are in whether policy allows them to be built in principle. A movement focused only on the legal right to build, rather than the conditions under which building actually happens, will only get so far.

Second, YIMBY groups need a more mature relationship with the development industry. That does not mean becoming their uncritical cheerleaders. But it does mean engaging seriously with the companies that will build almost all new homes for the foreseeable future. Much of the YIMBY movement seems at best uninterested in how the development industry actually functions, and at worst openly suspicious of the firms and commercial models that will deliver most new homes. That matters because the more practical and operational constraints on development get downplayed.

There is a tendency in pro-housing circles to romanticise micro-scale, street-by-street intensification while disregarding the role of larger developers. The former might play a role in decades to come, but the reality is most new homes in England are built on larger sites by larger firms with complex delivery models. A serious pro-housing movement should want those systems to work better, not keep them at arm’s length.

For The Telegraph, John Bew and Guglielmo Verdirame say we need to drop our sentimental attachment to the dying international order.

Our concern starts from the way that the idea of a rules-based order is treated as an almost theological abstraction, as a God-given gift from which dissent cannot be contemplated. By this argument, the answer to our current discontent is to make fidelity to international law the organising goal of our foreign policy and the premise of every decision we take. This risks creating an imbalance in our foreign policy in a world where ever-fewer states share this approach.

Importantly, it is an approach that goes way beyond the astute Chilcot checklist in which international law is treated as one of 10 critical points to consider in the making of national security decisions. Yet those who may question this prioritisation – international law crowding out all other considerations – have been accused of being followers of the Nazi theorist Carl Schmitt, as somehow willing to give up on international law in favour of might over right.

The danger is that we end up as curators of an old system rather than active participants in a new world in which power is being more nakedly asserted. It is by a combination of tenacity, risk-taking and creativity that we have made ourselves present at the creation of previous international orders. If Britain is to have any say in the shaping of a future one, it cannot do so based on an abridged or ideological version of what has served us so well in the past.

Subscribe now

Wonky Thinking

On his Substack, Fraser Nelson analyses our public debt and how an attachment to inflation-linked gilts (so-called linkers) and quantitative easing are creating the conditions for a ‘debt bomb’ that could blow up the British economy.

These ‘linkers’ - inflation-linked bonds - worked very well for Britain until they didn’t. Offering to make loans inflation-proof helps flog them, so you borrow at a lower rate - so it’s a saving assuming (as they all did) that inflation, as we once knew it, would not come back. From its independence in 1997, HM Treasury had high confidence in its ability to control inflation and imagined the old tiger had been slain.

The linkers is just one part of the story. Perhaps just as big a factor is the way we did QE. Every country printed money after the crash, but the UK wanted to put HM Government at the front of the queue for cheap debt. The Bank of England bought bonds and turned long-term, future-proofed debt into short-term exposure at the overnight rate. According to the OBR, it has increased the speed at which higher borrowing costs jack up our debt interest bill by a factor of six (!). As its report explains:-

“The impact of a 1 percentage point rise in interest rates within one year has increased by around six-fold from a less than 0.1 per cent of GDP hit to net interest costs at the beginning of the century to about a 0.5 per cent of GDP hit by 2022.”

So QE swapped long-term security for short-term risk by replacing fixed-rate gilts with floating-rate reserves. The Bank of England created £713 billion (!) of these reserves — paying interest at Bank Rate — to buy long-dated gilts during QE. What once seemed a clever accounting trick ended up becoming fiscal hazard: a third of Britain’s debt now tracks monetary policy in real time. It has left us with a unique level of exposure.

A new paper by academics at the University of Manchester of productivity gaps in England has found there is less of a ‘North-South’ divide on productivity and more patches of poor performance. There are many low productivity centres in the South of England, whilst there are parts of the Midlands and North that have seen much more rapid growth. The paper calls for more a targeted and localised approach to spatial planning and investment.

Previous research by Wong and Zheng (2023) found that there was a very weak correlation between the labour productivity index and its change rate. This study goes further to unravel the spatial patterns and finds that while the headline of a pronounced productivity divide between the Greater London-South East region and the rest of the country broadly stands, there are however major variations in productivity level within the region, ranging from below national average (Group 6), through average (Groups 5, 7 & 9), to very strong (Groups 8, 10, 11 & 12) performance. Indeed, a much more complex and paradoxical picture emerges after factoring in the temporal dimension of annual growth rate. Nearly half of LADs perform below national level on both productivity level and growth rate and only less than a fifth show strong performance on both counts. Many high productivity LADs in Greater London and the South East have experienced stagnation or decline over the last twelve years, whereas many lagging LADs in the Midlands and northern England, starting from very low levels, have had positive growth trajectories. The productivity puzzle can be interpreted as a new ‘hare and tortoise story’: many high performers are losing ground in the race, when some poor performers are trying hard to catch up but have a long way to go. This rather bleak picture prompts for more tailored policy actions to accelerate or shift the trajectories of growth in different localities…

In policy terms, the uneven geography of productivity dynamics underscores the importance of place-based interventions to sustain the momentum of high-performing areas and to address structural weaknesses in those lagging behind. Indeed, many LADs south of the Severn-Wash line and in coastal areas have below national average productivity levels and growth rates. When zooming into the Greater London Authority and mayoral CA areas, the picture of spatial interactions is rather mixed and sporadic. While there are positive spatial spillovers found in Greater London and Cambridgeshire & Peterborough CA on productivity levels, the situation flips when positive spillovers of productivity growth are witnessed in their northern counterparts such as LADs in West Yorkshire, South Yorkshire and Greater Manchester CAs. There is also no one size fits all approach, as different combinations of driving factors are operating in different places. All these findings point to the need to have more contextualised approaches of spatial planning and resource allocation. These differential spatial trajectories require long-term strategic policy actions and local capacity building through further devolution of power and resources.

Subscribe now

Podcast of the Week

In The Spectator’s Coffee House Shots this week, Conservative MP Jack Rankin lays out the case for a more radical conservatism based on wealth creation and aspiration, building on the work of ‘Next Gen Tories’.

Subscribe now

Quick Links

The government has u-turned on granting North Sea drilling licences.

The Conservatives pledge to scrap carbon taxes on industry.

Britain has developed a new AI powered drone for finding hidden bombs.

The new mansion tax will cost the Treasury £275m before it raises any money.

President Trump has fired the US Army Chief of Staff.

Food inflation is set to hit 9% by the end of the year - three times higher than previously predicted.

One of the country’s key ball bearing manufacturers has shut down.

The government predicts it will miss its 1.5m new homes target by 400,000.

Towering Columns

In The Spectator, Shadow Justice Secretary Nick Timothy explains his objections to a mass Muslim prayer event being held in Trafalgar Square.

Opponents of Labour’s ‘Islamophobia’ definition warned it would stop us debating religious ideas. Ministers insisted we were wrong and dismissed concern about the confusion of racial identity with religious belief. Yet the week after the definition was announced, the Communities Secretary accused me of racism and Keir Starmer demanded my head. My crime was to call the ritual prayer by Muslim men in Trafalgar Square – and the adhan, the Islamic call to prayer – an ‘act of domination’. I did not question the freedom of Muslims to gather to break their Ramadan fast, nor their right to pray in mosques. But using public spaces to pray is a growing trend, and it makes a political statement. Islamists do this to achieve what the scholar Ed Husain calls the ‘total Islamisation of public space’. I saw Ed on Sunday, and we discussed how the Quran, like the Bible, warns against proud public displays of piety.

Politicians stick safely to the line that Islamism and Islam are entirely separate. But Islamism is inspired by Islamic teaching and Islamists pursue their goals in the name of the faith. More than other religions, Islamic theology promotes the application of religious principles to the political sphere. And it is far less open than Christianity to the separation of the spiritual and the secular. The people praying in Trafalgar Square were probably not Islamists. They were doing what they would have done had they broken their fast at home. But that does not make it appropriate in a shared public space, and certainly not one of national significance like Trafalgar Square. In public and in private, many Muslims agree with me. I regret that I offended at least a couple of Muslim friends. But many say there is no theological need for the adhan or for prayers before an iftar. Others I have attended have been held without them.

So I wonder why, if the event was supposed to be inclusive, the organisers felt it necessary. The adhan declares – very loudly – the unchallengeable truth of Islam. It asserts there is no god but Allah, and Muhammad is his messenger. It rejects other beliefs, including the Christian belief in Jesus as the son of God. This – and the Muslim method of prayer when performed in public – is inevitably exclusionary. Indeed, barriers were erected to create a specific prayer area. Those who pretend there is no difference between the iftar and other celebrations in Trafalgar Square miss the point. Everyone is free to enjoy Sikhs and Hindus dancing for Vaisakhi or Diwali, and to watch the Passion Play at Easter. Chanukah events there do not require a special area for Jews to pray alone. There is no declaration of the supremacy of the Jewish faith. This is not a question of religious freedom: there is no automatic right to the exclusive occupation of shared civic space.

In The Times, Juliet Samuel says exploiting North Sea reserves could help Britain whether the Middle East oil and gas crisis.

North Sea gas is estimated to generate a sixth of the carbon emissions of imported liquefied natural gas (LNG), especially where it is close to existing infrastructure. But Ed Miliband, the energy secretary, insists that more drilling won’t make a difference to prices and has defeated a push from the Treasury to make Britain’s tax regime more attractive for oil exploration and to overturn a ban on new exploration.

While it is true that British North Sea production is unlikely to scale up to a level that could affect wholesale prices this year, there could still be market-changing volumes of oil or gas left in the ground. The North Sea Transition Authority estimates that the UK slice of the continental shelf contains up to 15.8 billion BOE (barrels of oil equivalent) of hydrocarbons, 15 years’ supply at current rates and equal to a third of all the oil and gas that has ever been extracted from it. The OEUK, an industry group, estimates that 7.5 billion barrels of oil could still be extracted, more than twice the government’s estimate.

Just under three billion of that is “proven and probable”, essentially just waiting to be tapped (versus about 3.5 billion for Norway), while the rest requires more investment to map out and may not all be accessible. Much of the total may not be extractable, with the Economist Intelligence Unit stating that even the industry’s optimistic estimates suggest 93 per cent of what can be used “has already been removed”. But in just the last year before new exploration contracts were banned, the industry added over one billion to the total, suggesting more investment and new technology could well make a difference.

For The Critic, Steve Loftus says the scale of economic disruption AI may cause could destroy capitalism as we know it.

If a large share of jobs disappears, so too does the income that sustains demand. Who, then, buys the products? Who keeps the system turning? The engines of capitalism will stall precisely when they should be accelerating. A system built on mass consumption cannot survive if the masses no longer have wages. The usual reassurance is that new forms of work will appear, as they always have. Perhaps we will all become artisan cheesemakers, therapists, or therapists for artisan cheesemakers. But this time the pattern breaks. The same technology that destroys existing jobs also competes directly with any new ones. Therapy itself can be delivered by an avatar that remembers every sigh since nursery school. There is no obvious new frontier of human labour left untouched.

Only then does the full economic consequence become clear. If machines perform most work, and labour and energy both trend towards near-zero cost, then prices begin to collapse. A nuclear reactor built by robots, maintained by drones and optimised by algorithms could deliver electricity for next to nothing. Vertical farms tended by machines that work 18 hours a day, 7 days a week could outproduce today’s best land with a fraction of the inputs. When a refrigerator can be printed, delivered and installed for little more than raw materials and energy, the cash register starts to look like a museum piece.

What comes after may, in theory, be better. This is the part many people struggle to imagine, because all our political languages were built for a world in which human labour remained central. Capitalism assumes scarcity, wages and mass consumption. Socialism assumes human production and political conflict over how its proceeds should be divided. AI unsettles both assumptions at once. If machines can produce abundance with minimal human input, then neither the free market nor the planned state, in their inherited forms, fully explains the world ahead. There may be some future system beyond both, a post-labour settlement for which we do not yet have a name. It may borrow from markets, public ownership, common governance, citizen dividends and new forms of distributed control. It may look, in places, familiar. But in the end, it will belong to a category we have not yet learned to describe. From inside a wage-based civilisation, it is hard to see clearly what a post wage one would look like.

In The Spectator, Douglas Murray criticises the BBC’s latest drama for depicting concerns about migration data as a conspiracy theory while demonising white men.

Which brings me to this week’s attempt at brainwashing the British public. It comes in the form of a BBC drama called The Capture. In this week’s episode our brave agents are on the trail of a dastardly villain – a white working-class man by the name of Whitlock. What is this villain guilty of? Well, one thing is that he has been found to have put in Freedom of Information (FoI) requests to the UK government in the belief (as one of the agents puts it) that it is ‘covering up the true stats on undocumented migrants’. When two of our agents learn this they immediately turn around their car and get on the chase. That’s great TV drama for you, right there. Not an FoI request!

As we can all agree, only a very perverted mind would ever suspect the UK government of covering up any such thing as migration stats. Everybody with a scintilla of common sense knows that consecutive governments have only ever been honest and open with the public over the levels of documented and undocumented immigration. It is one of the reasons why we have such up-to-date and detailed information on – for instance – the amount of money it costs to house the latest arrivals by boat across the channel. And it is why the government does not have to try to cover up which hotels they are putting illegal migrants in.

But the BBC’s dramatists are not content with a mere FoI-requesting wrong ’un as the chief villain of the story. No – this man must end up taking up a rifle, heading to Dover and trying to sharp-shoot a boatload of illegal migrants, including a young child of the type who almost never make the journey in question. I say ‘almost never’ based on the photographs and evidence I have seen. Most of the people who arrive in these boats are young males who you are also not allowed to describe as being of ‘fighting age’. If I am wrong on this question of age-demographics then I am happy to be corrected. Certainly I would rather be corrected than put in an FoI request and immediately make myself suspected of terrible far-right activity.

In the Financial Times, Gillian Tett says the Iran war has revealed the extent to which high-capex, capital-intensive industry matters.

Maverick economists such as Peter Navarro were often mocked in the past when they decried how the west was outsourcing cheap manufacturing to China. Metal-bashing seemed old-fashioned. So did industrial self-sufficiency. But now the cultural pendulum is swinging. Navarro is a key adviser to Trump, who shares his obsession with manufacturing. Meanwhile western graduates are starting to fear that AI will destroy many service sector jobs.

And now the Iran war has shown politicians why industrial self-sufficiency matters. In financial markets, so-called Halo trades (heavy-asset, low-obsolescence businesses that require significant tangible capital expenditure) are on a tear. “The landscape is reshaping the balance between physical assets and human or digital capital models,” says one Goldman Sachs note, pointing out that capital-intensive stocks have produced 35 per cent higher returns than capital-light ones since 2025. “Physical asset businesses have outperformed sharply, while software and other capital-light models have lagged.”

There is one crucial caveat here, which [Jeff] Currie [analyst at the US private capital group Carlyle] notes. Today’s AI sector cannot function without physical, capex-heavy businesses backing it. Just think of those data centres. That means that “hard” industries are now blending with services to a degree that was not as obvious when Fingleton wrote his book in 1999. Even AI obsessives know that molecules matter. So the big question that now hangs over the west is this: will the cultural attitudes towards “hard” industries also shift? Will elite students now fight for manufacturing jobs? Might industrial engineering command higher status than banking?

In Foreign Affairs, Hugo Bromley saysEurope can no longer be a military power and Britain remains America’s best military partner.

To renew the Euro-Atlantic settlement, European Union institutions must step back from defense issues and focus on fostering economic growth through existing competencies. In the short term, there is no alternative to the United States providing the expensive and technologically advanced capabilities needed to deter Russia. In the long term, new spending programmes should be developed through intergovernmental agreements, with NATO focusing on maintaining interoperability among its members. Washington should not expect increases in defense expenditure to be equal in percentage terms among EU member states. These commitments should instead vary, depending on fiscal space and voter appetite for increased expenditure. Fortunately, it is the states of northern Europe, and on NATO’s eastern flank, that are most able and willing to increase their defense budgets in response to the Russian threat.

European countries should also look beyond their borders for partners. Projects such as the GCAP fighter development program between Italy, Japan, and the United Kingdom only strengthen European security. Similarly, Poland is right to look to South Korea to provide military equipment and gain expertise, since both rely on large conventional land forces. EU member states should commit to giving all U.S. treaty allies partner status in Brussels’s defense financing initiatives. This would encourage beneficial cooperation, and limit the Commission’s willingness to use rearmament as a vehicle for integration.

The United States’ most important partner in this rebalancing remains the United Kingdom. Through defenseindustrial and nuclear cooperation, as well as the Five Eyes intelligence-sharing network, London and Washington maintain an unprecedented and deepening geopolitical friendship. The last Conservative government pioneered “mini-lateral” defense partnerships through AUKUS and the Joint Expeditionary Force— a vehicle for cooperation among Baltic and North Sea countries to counter Russian actions. That is not to say, however, that London is doing all it should. Despite strong bipartisan support for Ukraine, British defense spending is rising too slowly and is not scheduled to reach 3.5 percent until 2035. Washington should encourage the United Kingdom to spend three percent of GDP before the end of the current Parliament in 2029.

Subscribe now

Wonky Thinking

Policy Exchange launched “Sickfluencers and AI How Technology is Changing the Health and Disability Benefits System” by Gareth Lyon and Ticiana Alencar. The report reveals how influencers and AI are driving bogus sickness claims in the benefits system.

The UK’s health and disability benefits system was designed for a very different era. Built around static assessments, binary judgements, and paperbased assumptions about illness, work, and support, it is now operating in a radically altered social and technological environment. The rigid and tick-box nature of the current regime has left it increasingly vulnerable to exploitation by online communities, so-called “sickfluencers”, and artificial intelligence tools. Together, these forces are reshaping how individuals understand eligibility, frame need, and interact with the welfare system, contributing to a sharp rise in successful claims and placing a growing and unsustainable strain on public finances.

This report focuses on the “grey area” within the health and disability benefits system, where entitlement, need, and support are most contested. To analyse interactions with the welfare system, we identify four broad groups:

Group 1: Clearly entitled and appropriately supported

• The first group comprises individuals who clearly require support and receive it appropriately.

Group 2: Entitled but underserved

• The second group comprises individuals who should be entitled to assistance but are unable to access it due to complexity, administrative barriers, or insufficient support, and who are often among the most vulnerable in society.

Group 3: Fraudulent abuse

• The third group comprises individuals who deliberately abuse the system through fraud, for whom enforcement and prosecution are justified.

Group 4: The Grey Area

• This fourth group is the most analytically challenging and occupies what we describe as a “grey area”. It comprises individuals with genuine functional challenges whose circumstances do not clearly warrant the level or type of ongoing state support currently available. In some cases, their challenges may be better addressed through short-term, targeted, or non-financial interventions rather than continued entitlement to disability benefits.

To understand what is driving the rapid growth in claims, particularly in the contested “grey area”, we carried out a deep-dive investigation into the online ecosystems that now shape claimant behaviour. This included analysis of large discussion groups and platform-based creators (“sickfluencers”), and observation of emerging use of generative AI tools to interpret eligibility criteria and draft applications.

This fourth group is characterised not by dishonesty but by uncertainty. Broader societal pressures — including shifting norms around health, work, and identity, amplified by social media — may shape how individuals understand their need for support. At the same time, detailed guidance on eligibility criteria is widely available online, making it easier for some claimants to adopt the language most likely to secure an award. Those without digital access — a disproportionately large share of disabled people — are less able to do so. If left unaddressed, this grey area risks expanding in ways that are difficult to justify, target, or sustain, further eroding trust in the health and disability benefits system.

While the size of this “grey area” group is difficult to quantify precisely, available evidence suggests that it is both real and growing. 16.8 million people, or roughly one quarter of the population, considered themselves disabled in 2023-24, up from about 11.9 million (19 per cent) in 2013- 14. The largest increase has happened amongst those aged 16-25 years old, where disability prevalence has more than doubled to 18% from 8%. In 1993, 15.5% of 16 to 64-year-olds had a common mental health condition, compared to 22.6% in 2023-2024. This is correlated with a rise in those who are now claiming incapacity and disability benefits. There are now over 4.2m people on Universal Credit with “no work requirements”, and it now makes up over half of those on UC. 1.5m people are now claiming PIP for mental health conditions, and that is an increase of over 100,000 in the space of a year. Economic inactivity due to ill-health costs £212 billion per year, equivalent to 7% of GDP.

The system operates within a technological landscape that has changed dramatically since its initial design. Fifteen years ago, people seeking support were mostly likely to approach established charities or welfare advisors. Today, many turn to online communities and sickfluencers to guide them through processes. Artificial intelligence is already beginning to assist claimants in understanding eligibility criteria, drafting applications, and pursuing appeals, and its influence is expected to grow quickly. While claimant behaviour and information ecosystems have evolved rapidly, the structure of the benefits system and its assessment frameworks have largely remained unchanged…

Subscribe now

Podcast of the Week

The Shadow Justice Secretary, Nick Timothy, explained his views on the mass public Muslim prayer event in Trafalgar Square on the Telegraph podcast.

Subscribe now

Quick Links

The Brent crude oil price went back up to $110.

The Bank of England now expects oil prices to drive inflation up to 3.5%.

An imam said the Shadow Justice Secretary was right about the Muslim prayer event in Trafalgar Square.

A North Sea energy company called on Ed Miliband, the Energy Secretary, to back Shetland gas fields that could power the UK for 5 years.

The social media platforms Instagram and YouTube were ruled to be addictive by an LA court.

The Government’s announced new investment in roads in fact amounts to a 15-20% real terms cut.

Britain could become a net importer of salt for the first time in history, if Inovyn - which produces half the UK salt supply - closes its plant in Cheshire.

The Islamic Centre of England, a registered charity, is due to hold a vigil to commemorate the Ayatolla Khamanei.

A man arrested on suspicion of spying for China accessed the parliamentary estate on multiple occasions and as recently as January.

For The Telegraph, Nick Timothy calls for everyone to resist attempts by groups to dominate the public realm.

And that pattern is clear. We have seen protestors take a break from their marches against Israel to pray in the open air. We have seen symbolic ritual worship in front of national monuments such as the Houses of Parliament. When the extremist preacher Abu Hamza was turfed out of Finsbury Park Mosque, he led his supporters in ritual prayer on the residential streets nearby.

These are all acts of domination: an expression of power. And that power is now shaping our public life. The politics of communalism are already corrupting important institutions like the police, as we saw with the scandal of the ban on Israeli supporters from a football match in Birmingham. We are likely to see it at the ballot box in the local elections in May. And of course, these political trends are behind the Government’s new “Islamophobia” definition.

The purpose of that definition is to shut down debate, and stifle scrutiny of religious ideas and associated political beliefs. This should appal us all, because it is contradictory to the basic tenets of a free society. If we lose the ability to challenge ideas, beliefs and even actions, we can no longer call ourselves a free country.

In The Spectator, Jonathan Sacerdoti writes that we must be more nuanced in how we debate the use of public spaces.

It’s true, I have stood several times under the shadow of Admiral Nelson next to a massive Chanukiah, eating doughnuts and spreading Jewish good cheer. But it is intellectually dishonest, and socially tone-deaf, to equate these events with crowds of Muslim men prostrating on the pavement to the sound of “Allahu akbar” during a full public prayer service. They register differently with Londoners who witness them, shaped by distinct cultural backgrounds and motivations. That, in essence, was the point Nick Timothy was making.

I have often seen small groups of Muslim men praying in Israel’s Ben Gurion airport, unfolding their rugs and quietly engaging in their religious practice. Nobody bats an eyelid. Similarly in airports across the world, many observant Jewish men wrap tefillin in groups of ten when it is time for their morning prayers. These episodes tend be uncontroversial because they are clearly quiet, personal moments of religious reflection, respectfully carried out in an unusual place out of necessity, because of travelling schedules, time zones, or a lack of synagogues or mosques nearby to pray in. Mass street worship is different.

Suppressing discussion of the fears surrounding this sensitive subject will only deepen, for some, the sense of being overridden or subordinated.

For The Times, Tony Sewell calls for policies that improve life chances for all and do not divide the country.

A striking finding was that in many areas it was the white working class who experienced the worst outcomes. African women, for example, had the longest life expectancy, while poor white men in parts of northern England had the highest mortality rates. Educational attainment among poor white boys lagged behind many minority groups. Rather than demonstrating systemic privilege or racism, these statistics suggested disadvantage was primarily linked to poverty and social conditions rather than ethnicity alone.

The backlash was immediate. Critics accused the report of downplaying racism or ignoring historical injustice. Some suggested that highlighting the struggles of poor white communities was politically suspect. Yet ignoring these realities would not make them disappear. Indeed, the frustration of neglected communities has already helped to fuel the rise of populist movements such as Reform UK.

The central principle of the report was straightforward: the most effective social policies raise standards for everyone rather than privileging particular identity groups. A rising tide lifts all boats. If governments improve schools, strengthen families and expand economic opportunity across society, the benefits will reach every community.

In The Telegraph, Allister Heath writes that everyone is too scared to admit how vulnerable Britain has become.

We can no longer afford the luxury beliefs of a bygone peacetime. Why is Britain still obsessed with offshore windfarms, when they pose a double threat to national security, providing costly, intermittent electricity, while sometimes partly blinding missile detection systems? The Swedes vetoed windfarms in the Baltic Sea as they feared the turbines may cut Russian missile detection time to as little as 60 seconds, possibly by introducing clutter and blind spots.

Britain prefers to sacrifice itself pointlessly. In an act of gross geopolitical hara-kiri, Britain’s output of electricity is down 25 per cent since 2004. We slashed North Sea oil and gas and refused to frack. Modern warfare is all about technology, manufacturing and logistics, and that requires cheap and plentiful power, working closely with America (rather than picking inane fights with Donald Trump) and doing everything possible to nurture investment in the UK.

Instead, misled by our third-rate Prime Minister, we cling to appeasement when it comes to Iran and China, in the hope that we can continue to consume beyond our means, to ignore the sectarian divisions racking our society, to worship at the altar of net zero and socialism, to turn a blind eye to the violence and rapaciousness that characterises the New World Disorder.

In The Critic, Chris Bayliss describes how we have traded our energy security for a mythical belief in the long arc of progress.

Miliband sees his role as an agent who bends the long arc of history toward progress, and that justification totally overwhelms trivial questions like “Does this policy make logical sense?”. Like many green zealots — especially those who have been converted as adults — Miliband has a profound sense of his own historicity. As he sees it, these are the critical years in the history of humanity and the entire planet; to have been born in these times when fate hangs in the balance is to have been entrusted by destiny with a unique and heavy duty. That he holds relevant political office during such momentous times only makes this obligation more awesome. For him to back down over the fact a litre of petrol has gone up by a few pence would be a laughable dereliction. A few million households facing financial hardship is a banality that will not even make the footnotes when the history is written.

Furthermore, the point that it makes little sense for Britain to cease oil and gas exploration while we continue to import the stuff is to consider agency and responsibility on a national level. Which Miliband doesn’t. For him, climate redemption is achieved as an individual. It just happens to be that he is a national politician with responsibility for Britain’s energy policy. He would be similarly unmoved by what the rest of the world were doing if he were making decisions as a European commissioner, or as a county councillor, or if he were merely responsible for his own household. If he could completely shut off oil and gas imports, he would, but that isn’t an option yet. However, the decision of whether the British government will issue licences for new oil and gas exploration is his to make right now, so the answer is “no”.

Others may argue that making reasonable concessions to public opinion at critical moments might benefit the green agenda in the long run, by limiting the chances of a backlash. But climate politics lives or dies by its sense of inevitability. There are only so many true believers like Miliband or Al Gore who get near positions of power. The movement is only effective so long as it retains its power over the cynical or weak-willed — the likes of Angela Merkel, David Cameron or Boris Johnson. And that power comes from the green movement’s monopoly on a vision of the future, at least in terms of energy.

In The Times, Juliet Samuel calls for politicians to blast away dogma to successfully build urgently needed nuclear power.

It will take time and ironclad political will. But my gosh, done right, the energy is cheap. The average generating cost for nuclear in Korea is about £30 per megawatt hour — about a third of the UK’s power cost and a sixth of what our own nuclear costs — and that includes future decommissioning and waste management costs. Even if you assume higher labour and regulatory costs in Britain, this explodes the 20-year dogma propounded by dominant factions in Whitehall that nuclear is always just too expensive.

How did Korea do it? The country’s success comes from a genuine sense of urgency about the need to survive. Emerging from Japanese rule in the 1940s as a tiny western-aligned and subsequently war-divided nation in a hostile neighbourhood, with a population of poorly educated peasants and few natural resources, Korea had to do something drastic. Successive presidents and military dictators put their extremely limited resources into nuclear technology, construction and education and placed their fledgling industry under the tutelage of America’s Westinghouse.

By the 1980s, as Britain’s civil nuclear programme was running out of steam, Korea was ready to scale up. Incredibly, instead of the programme being shut, its scientists were allowed to treat Chernobyl as a buying opportunity, snapping up US technology on the cheap and beginning an era in which the country commissioned an average of one big new plant per year, even through the Asian financial crisis.

In The Critic, Sebastian Milbank cautions against a naïve faith that AI will fix our economic problems.

Yet polling suggests that less than half the British public trust this policy, and, at a time when public trust in the state is at record lows, this is a very risky gamble indeed. Whatever the technology’s potential, it is very far from reaching it, and as I have written previously, the limitations and risks of the technology are largely ignored or concealed by those touting it. That leaves Britain as an “early adopter”, forking out billions for AI systems that will be far worse and less specialised to the needs of the public sector than what we might see emerge in 5-10 years time.

Nor is this primarily benefiting a domestic British industry — the AI industry is concentrated in America, and Britain’s most successful AI firm, DeepMind, was acquired by Google 12 years ago. Somehow, I don’t expect government plans to extend to renationalising it. And over in Silicon Valley, tech industry leaders openly acknowledge that the pace of investment in AI vastly outstrips its present potential for profitability. Figures like Jeff Bezos and Sam Altman have cheerfully admitted AI is a bubble. The calculation there is that it is a “good bubble” and that, as one investor puts it, “the benefits of innovation outweigh the costs of volatility”.

Yet the sheer scale of investment, which has seen firms like NVIDIA hit valuations putting it on a par with the entire British economy, reflects an unprecedented level of hype. Many of those same figures who see this as a “good bubble” are also claiming that we are on the brink of something called “the singularity”. According to Sam Altman we are “close to building digital superintelligence”.

Subscribe now

Wonky Thinking

On Substack, Archie Hall outlines a number of scenarios for how Britain could be negatively impacted by the emergence of AI given our service-heavy economic model.

There’s an entirely respectable career to be made in conjuring up prophecies of economic doom for Britain. The past few years have offered plenty of raw material. Still, that’s a temptation I mostly prefer to resist. Permit me, though, a brief exception—a moment to indulge my inner perma-bear. I think it’s worth the lapse.

I want to air a possibility that has been troubling me for the past year¹: that Britain could make a real mess of the AI age. Certainly, there are plenty of great AI-adjacent British institutions, like AISI², ARIA, Arm and (further into the alphabet) DeepMind. But that does not, alone, mean that Britain’s wider economy, or its political system, is well-placed to navigate the shocks coming. On the contrary, I worry that Britain is especially exposed.

Here are a few scenarios. They almost certainly won’t all happen, and aren’t even always entirely mutually consistent. But, hopefully, the exercise pulls open a few windows into how the coming years could go wrong for Britain. (A common starting-point isn’t quite AI doom or rapid takeoff, but a case where much of the economy does get remade rather quickly.)

Also on Substack, Neil O’Brien goes through the latest data on youth unemployment including the gap between big tax rises and small incentives for employers to hire people, as well as wage compression that has made it much less attractive for employers to hire younger workers.

In contrast, at present the government has created a big problem but is offering only small solutions.

Employers are still being told that if they plan to take on young people they can soon expect them to be being paid the same as 40 year olds.

The triple whammy of higher tax, much more regulation and the attempt to flatten wages has clearly increased youth unemployment in the UK compared to other countries. And this was all before the war in the Middle East. If we are going to end the tragedy of youth unemployment, the government needs to stop coming out with fiddly small policies - and have a much bigger rethink.

Subscribe now

Book of the Week

Correlli Barnett’s The Collapse of British Power, the first book in his ‘Pride and Fall’ series, describes the deadening impact of liberalism in the lead up to the Second World War which left the country unprepared for rising economic and political threats from overseas.

The swift decline in British vigour at home was not owing to some inevitable senescent process of history. They shared a specific cause. That cause was a political doctrine; a doctrine blindly believed in long after it has ceased to correspond with reality.

The doctrine was liberalism, which criticised and finally demolished the traditional conception of the nation-state as a collective organism, a community; and asserted instead the primacy of the individual. According to liberal thinking a nation was no more than so many human atoms who happened to live under the same set of laws. From such a belief it followed that the State, instead of being the embodiment of a national community as it had been under the Tudors and the Commonwealth, was required to dwindle into a kind of policeman, standing apart from the national life, and with the merely negative task of keeping the free-for-all of individual competition within the bounds of decorum.

Subscribe now

Quick Links

An Iranian man was arrested trying to enter one of the UK’s naval nuclear bases.

Labour backbenchers threaten to vote against the Labour government’s immigration reforms.

British government debt interest was £8.8bn higher than economists expected last month.

Iranian missiles cause extensive damage to the world’s largest LNG export facility.

The South East of England is on alert due to an outbreak of meningitis.

The Bank of England signals interest rates will rise twice this year to combat inflation caused by War in Iran.

One of the country’s largest North Sea Oil producers says that it is ready to exploit UK’s biggest oil field this year with government backing.

The Natural History Museum has overtaken the British Museum as the country’s most popular tourist destination.

Norwich is the best place to live in the country according to The Sunday Times.

Towering Columns

In the New Statesman, former Downing Street foreign affairs adviser John Bew says Britain risks remaining unprepared for its “Fourth Great Disruption.”

As it stands, the likelihood of a catastrophic crisis – or at least a series of overlapping contingencies that become unmanageable – is increasing. But there is nothing inevitable about a descent into war or further anarchy. A new equilibrium is not beyond the wit of man. Nor should we give up on the idea that new norms can be established to allow us to create the conditions for domestic growth and harmony, and more stable and predictable relations between nations. On both sides of the Atlantic, an interesting conversation is beginning about what comes after the current crisis. Might a new economic and security “commons”, based around a re-contracting of interests rather than perfect ideological harmony, be possible to construct?

Yet crucially, even in this more benign scenario, we have to confront the reality that we are in a vast renegotiation of everything: the basis of social contract; the underpinnings of political economy; the legal and constitutional basis of national and international life; the division of responsibilities within our alliances; the inputs and outputs expected from the national security state; the areas of geographic focus for our diplomatic efforts; the terms of international trade; the level of tariffs, export and import controls; the foundations of our energy policy; and our ability to generate or access the benefits of the technological revolution that is the essential precondition of our future security and prosperity.

In this world, process-based punctiliousness is no substitute for being able to move things around on a map. The lesson of the past great disruptions is this: if you want to protect Enlightenment values, a dose of realism is necessary. As a young Lord Castlereagh said in 1792, at the time of the first great disruption: “The language of reason, of enlarged and enlightened policy, has not yet penetrated thoroughly the cabinets of princes. Power and importance is necessary almost to procure a hearing. I am afraid we should cut a sorry figure and exhibit an appearance not very imposing, were we to appear before them simply clad in the garb of our insular dignity and abstracted freedom.” Those words could well apply today, not least with regard to our ability to influence events in the Middle East.

For The Critic, Maurice Cousins says Sir Ed Davey’s record in office and current policies are bringing about British energy disarmament.

The result was a shift toward energy sources physically inferior to the denser and more reliable fuels they displaced. Their diffuse and intermittent nature has raised system costs and pushed Britain’s industrial electricity prices to among the highest in the developed world, driving the loss of strategic industries such as primary steelmaking and ammonia production — essential for fertiliser and explosives. It has also put new sectors like data centres and AI at a competitive disadvantage. This is disarmament — not of our armed forces, but of the nation’s energetic and industrial foundations. Yet Churchill spent much of the 1930s warning that disarmament would embolden dictators like Hitler and Mussolini.

Another catastrophic decision taken by Davey was the regulatory regime that killed Britain’s shale gas industry before it had even begun. The seismic limits he imposed on fracking made commercial extraction impossible. Davey himself later admitted the effect, saying in 2019 that the rule meant the industry “has not developed in this country at all”. Even after Russia’s invasion of Ukraine exposed Britain’s energy vulnerability, he said in 2022 that he remained “proud” of the outcome.

None of this is to suggest that Churchill himself was infallible. During his time at the Treasury in the 1920s he supported policies that weakened Britain, including the “ten-year rule” that assumed the country would not face a major war for at least a decade. Some held him partially responsible for delays of the development of Britain’s naval base at Singapore. Yet history remembers him not for his earlier errors, but for his capacity to recognise reality when it mattered most and to act decisively once the danger became clear. If Britain can forgive Churchill his mistakes and still regard him as “the greatest Englishman who ever lived”, then we can surely extend the same grace to our leaders today. But that forgiveness comes with a condition. Like Churchill, they must be willing to confront uncomfortable truths, abandon comforting illusions and take the decisions necessary to secure the country’s future. That starts with rejecting the idealistic Net Zero doctrine and embracing hard-headed energy realism.

On his Substack, Archie Hall examines the possible implications of AI for Britain’s service economy, savings patterns, dynamism and skills base.

There’s an entirely respectable career to be made in conjuring up prophecies of economic doom for Britain. The past few years have offered plenty of raw material. Still, that’s a temptation I mostly prefer to resist. Permit me, though, a brief exception—a moment to indulge my inner perma-bear. I think it’s worth the lapse. I want to air a possibility that has been troubling me for the past year: that Britain could make a real mess of the AI age. Certainly, there are plenty of great AI-adjacent British institutions, like AISI, ARIA, Arm and (further into the alphabet) DeepMind. But that does not, alone, mean that Britain’s wider economy, or its political system, is well-placed to navigate the shocks coming. On the contrary, I worry that Britain is especially exposed…

…If there is one defining fact about the British economy, it is that services dominate. That, one could fairly reply, is true of every advanced economy, no matter the hopes of the manufacturing nostalgics. But the skew to services in Britain is remarkable, even compared with its peers. No other G7 country has services made up much more than a third of total exports. In Britain, that figure is over half. That trade comes mostly in the dull, professional sectors you’d expect: banking, law, insurance and the like. Naturally, un-bylined articles about the economy comprise a small but vital slice thereof.

When tariffs started raining down, that tilt offered an under-appreciated advantage: Donald Trump doesn’t seem to believe in services and has largely exempted them from his trade war. Both of the charts above come from a piece of mine from last April, explaining why Britain was well-insulated from tariffs as a result. The same cannot be said for the impacts of AI. Here, instead, the shape of Britain’s economy leaves it vulnerable. Take a look at the chart below, which slices similar data in a slightly different way: looking at the share of Britain’s total output that is services exports—about a fifth, triple the share of 30 years ago. Expensively slinging emails across the Atlantic surely ranks high on the list of tasks that firms are already looking to automate. And when firms abroad do that automation, the productivity gains land entirely elsewhere (New York, say); Britain loses out.

On his Substack, historian Niall Ferguson asks whether the Iran-Israel conflict could be the start of World War III.

A prolonged war in the Gulf would also be a serious problem for American deterrence in the Indo-Pacific as it would run down stocks of all kinds of American weaponry that is expensive and slow to replace: not only PAC-3 magazines but also SM-6 missiles, for example. The race is on to replenish U.S. capabilities in Asia with the next generation of lower-cost, faster-made weapons: what the military men call “cheap kill.” Hypersonic missiles like Castelion’s; airframes like Divergent Technologies’; futuristic supply planes like JetZero’s; autonomous drone swarms like Auterion’s. But it is a race. And the faster the United States runs to apply the lessons of wars in Ukraine and now Iran—above all, the need for low-cost, large-scale weapons systems—the greater the risk that China decides to make its move against Taiwan now. Before we are ready.

Unlike Russia’s invasion of Ukraine four years ago, the U.S.-Israeli air war on Iran really ought to be short. However, uncertainty lingers over the Iranian regime’s resilience—the depth and breadth of its fanaticism—and its capacity to inflict enough damage to keep the Strait of Hormuz effectively closed or otherwise to reduce Gulf oil exports. Under these circumstances, as in 2022, the world’s importers of fossil fuels must scramble for scarcer and dearer resources. The longer the war lasts, the heavier the costs for Asian and European oil and gas importers, and the more money for Russia. Even if there is a swift regime alteration in Iran, the world will not swiftly revert to the status quo ante. Defense expenditures will continue to rise. Investments in the new generation of unmanned weapons systems and drone defenses will grow. There will be more, not less, nuclear proliferation. And the two superpowers will inexorably draw closer to some kind of moment of confrontation.

This year, the war in Iran probably reduces the risk of a new conflict in East Asia. But what happens in 2027 and 2028 will depend on who wins Gulf War III and how quickly they win it. Gulf War I (1990–91) was short. Gulf War II (2003–2011) was not. This isn’t World War III. But if it drags on, Gulf War II is potentially an event as significant as the 1973–74 oil shock. As well as being economically disastrous, that was one of the more dangerous moments in Cold War I. Today is best understood as an equally dangerous moment in Cold War II.

For Compact, Christopher Beha says neither Mill’s liberalism nor Yglesias’s ideal of “abundance” are sufficient for human flourishing.

One of the most salient features of contemporary American life is how anxious, depressed, isolated, angry—simply put, how unhappy—many of us are. If we take seriously the utilitarian view of happiness as the great measure of the good, this would seem to be liberalism’s most profound failure. We are unhappy although in absolute terms we remain the richest nation on the planet. We are far less happy than many far less affluent societies. We already have technological powers beyond the imagining of Bentham or Mill or even our own great-grandparents, and we are not happier than any of them. We have cut the distance from New York to London from months to weeks to days to seven hours. Will cutting it from seven to two finally deliver us from our existential distress?

What does flourishing look like for us? It is all well and good to celebrate the fact that liberalism won’t dictate an answer to that question, but many of us don’t have a satisfactory one to hand, and we are looking for some help. This is the question of meaning that led Mill to his mental collapse. He saw that the strictly quantitative utilitarianism that Bentham and his own father had preached was helpless in the face of this question.

After his mental collapse, Mill began to believe that we could, and must, distinguish between “higher” and “lower” pleasures, and that there was a greater good to be had in life than bare happiness. “It is better to be a human being dissatisfied than a pig satisfied,” he wrote; “better to be Socrates dissatisfied than a fool satisfied.” Toward the end of his life, he wrote a series of essays about religion and theistic belief. While he never became a believer, he expressed a surprising sympathy for the power of religion to give life meaning, to provide for precisely those emotional needs that his father had ignored in Mill’s upbringing.

Also for The Critic, James Price says Adam Smith’s Theory of Moral Sentiments is foundational to understanding The Wealth of Nations.

He also takes inspiration from Cicero, at one point copying a metaphor almost wholesale. In his De Officiis, Cicero uses a running competition to show the parameters of how to behave with others, even in competitive ways: “When a man runs in the stadium, he ought to strive and compete to the greatest possible extent in order to win, but he ought in no way to trip his fellow-competitor or to push him over; thus, in life, it is not unjust for anyone to pursue whatever he finds useful, but to despoil another is a violation of justice.” Smith’s version is uncannily similar: “In the race for wealth, and honours, and preferments, he may run as hard as he can, and strain every nerve and every muscle, in order to outstrip all his competitors. But if he should justle, or throw down any of them, the indulgence of the spectators is entirely at an end. It is a violation of fair play, which they cannot admit of.”

Smith showed that our moral life begins in what he called sympathy, our ability to imagine ourselves into the lives of others, and that from this natural capacity we develop conscience, and from conscience, virtues. Imagining witnessing our actions through the guise of an impartial spectator (an addition to Cicero’s concept as seen above) helps us check our behaviour.

This is how markets operate, too. If we were to lie and cheat and steal to get ahead, it may give us some temporary advantage. But if we were to continue to act in that way, we would soon find ourselves without others willing to trade with us. Again, the idea that discipline, education and example can lead people to act with tolerable decency first comes about in Smith’s earlier work, and it helps one understand the larger insights of the Wealth of Nations.

Subscribe now

Wonky Thinking

On his blog, Professor Dieter Helm says current energy policy is making Britain more exposed to shocks like the war in Iran, not less.

It takes a crisis to reveal the underlying state of Britain’s energy insecurity, and its defence. By now we should be basking in the success of “getting out of gas”. We do after all have a lot of renewables. These, we have been told, are nine times cheaper than gas. We don’t have much nuclear left, and we have got out of coal, so all our bets are in the renewables basket. We should be well on our way now to being a “clean-energy superpower”, relying on “home-grown energy” that should be bringing down energy bills by the now legendary £300.

None of this is so far realised. Britain has the highest industrial power prices in the industrial world, so no other country is looking to it to see how they could emulate it. On the contrary, everyone else wants to work out how Britain has ended up in such an unenviable position. We turn out to be utterly reliant on foreign supply chains for the renewables and the transmission and batteries needed to deal with all this intermittent generation. It turns out that we already need twice the capacity (120GW and counting), twice the grid, and all the batteries and storage, plus lots more interconnectors to service a firm-power demand peak of 45GW – which we used to meet comfortably with just 60GW of capacity.

Having got out of coal, and betting on intermittent low-density and geographically distributed renewables, it turns out that we have become more rather than less dependent on gas for our energy security. Iran’s interruption of its LNG gas shipments out of the Strait of Hormuz and the attacks on Qatar reveal how threadbare Britain’s energy security actually is. Why, given we don’t buy LNG from Qatar? Why do we seem to be worse hit than China, Japan, India, South Korea and Taiwan, all of which buy a lot of gas from Qatar? And why, given we have very little dependency on Gulf oil, compared with China (40% of all its oil coming through the Strait of Hormuz), India (15%), and Japan and South Korea (12% each)?

China, India and Japan have little gas or oil. China and India have lots of coal, with China burning more than 55% of all the world’s coal (!), and building another 400GW of coal generation capacity – all firm power, as against China’s wind (at around 24% load factor) and solar (at around 20% load factor).

Britain should be in a much better position. It has oil and gas reserves in the North Sea, and Norway nearby to provide over 30% of Britain’s gas, and it has good wind flows in the North Sea too. It is not in the league of the world’s energy superpower: the US. The US is by far the world’s largest oil producer, and its shale gas has translated it from what was supposed to be a major importer of Qatar LNG to first self-sufficiency from its shale gas, and in the last ten years it has become the world’s greatest LNG exporter. Ten years ago, it did not export gas; 20 years ago, the shale revolution had not got going.

Why, then, is Britain in such an energy mess? Part of the answer is its gas policies. Put aside the simplistic slogans about getting out of gas, and recognise that Britain will be dependent on gas for at least another couple of decades and probably more. Because of the energy mix that has been chosen (no coal, a fast decline of nuclear, and lots and lots of intermittent renewables), it will need gas to guarantee firm electricity supplies.

Whatever the political rhetoric from the Department for Energy Security and Net Zero, this is a reality. It is even clear in the scenarios of the National Electricity System Operator (NESO). It turns out that gas is critical to the renewables policies. It is not renewables instead of gas; it is renewables and gas. Energy security depends upon it, just as it depends on all those foreign supply chains of critical minerals and especially rare earths, and on all the solar panels and wind turbines made in China and elsewhere. If the Iran war has displayed that the emperor of the clean-energy superpower has no clothes, wait to see what happens if and when China invades Taiwan.

It turns out that our energy policies have not just weakened our energy security; it is much worse, they have undermined our defence. Why? Because they have undermined our defence industries and have also exposed us to having our energy supplies adversely hit by cutting the many interconnectors we now need to keep the lights on.

On the former, high energy prices have led to a cascade of exits from energy-intensive industries, and in short order. Gone is Grangemouth, a refinery in Scotland, one in Hull, most of the steel industry, the fertiliser industry, and the fibreglass industry. Our ability to produce the petrochemicals and refined fuels is now more dependent on imports. We don’t have our own steel in the volumes and of the quality we would need for a rapid militarisation.

On the latter, it is hard to think of a way to make Britain more vulnerable to a hostile power. Let’s call it Russia. One pipeline is responsible for 30% of our gas supplies (from Norway). We have virtually no gas storage. The cables are obvious sitting ducks for cutting. The North Sea wind farms are perfect targets for swarms of drones, the new weapon of choice in aggressive attacks. And for all this we have perhaps one boat that patrols all this offshore infrastructure….

Subscribe now

Podcast of the Week

On the Centre for Heterodox Social Science’s podcast, Eric Kaufmann and Danny Kruger discuss the philosophical foundations of modern Western politics, the limits of liberalism and the Blairite constitutional revolution.

Eric Kaufmann's Centre for Heterodox Social Science

Danny Kruger MP on the Crises of Western Society

Eric Kaufmann and Danny Kruger MP discuss the philosophical foundations of modern politics, the crisis of liberalism, and the future of Britain’s social order. Drawing on Kruger’s book Covenant, the conversation explores the distinction between covenant and contract, the role of Christianity in shaping Western institutions, and the tension between indiv…

Listen now

3 months ago · 21 likes · Eric Kaufmann

Quick Links

London Mayor Sadiq Khan welcomed the “biggest Iftar in the Western world”, held in Trafalgar Square at the weekend.

The CEO of RenewableUK, the wind energy trade body, urged Energy Secretary Ed Miliband to restart drilling in the North Sea.

Unite, the union, also called on Miliband to end his opposition to expanding domestic oil and gas production.

A Guardian columnist received major backlash after he penned a column calling the Jewish-founded coffee shop Gail’s opening near a Palestinian cafe an act of “aggression”, appearing to defend vandalism against the branch.

One in five university students say they would not want to live with a Jewish housemate, a poll found.

A report by the Centre for Social Justice found that the UK’s low birth rate could push the state pension age to 75.

Hate crimes against Muslims are twice as likely to be prosecuted against those against Jews, according to Home Office data.

France applied pressure to the European Commission to to exclude British countries from EU contracts.

In The Times, Ameer Kotecha describes how the Foreign Office is not fit for purpose.

Nearly five years ago, on the day Kabul fell to the Taliban, I was among several thousand officials invited to mark World Afro Day (for those unaware: “a global day of celebration and liberation of Afro hair”) with a panel discussion featuring a director charged with matters of national security. This week, with war raging in the Middle East and the RAF base in Cyprus under attack, the main news on the Foreign Office internal intranet was about the “New FCDO Capability Framework and self-assessment”, with all staff urged to “Take charge of your development”.

These provide a decent illustration of why, after over a decade, I have resigned from the diplomatic service.

The dysfunction runs deep. In recent discussions about how the Foreign Office could improve productivity with AI, some senior colleagues were more concerned with the need for an environmental impact assessment than for any proposed gains. Colleagues in the Department for International Development (now merged with the Foreign Office) justified to me their refusal to limit working from home to two days a week on the grounds that they didn’t want to work in a “colonial” office building. This is not culture war mudslinging. It illustrates a civil service culture hopelessly distracted by the peripheral, to the neglect of its core mission.

In The Telegraph, Maurice Cousins says that growing energy production is critical to restoring our hard power.

The numbers tell their own story. Between 2009 and 2024, installed generating capacity increased by more than 20 per cent – from 87 to 105 gigawatts. Yet total electricity output fell by nearly a quarter. Output per unit of capacity declined by over a third. We have built more but produced less power. In war, that kind of decline is a strategic liability. As the historian of grand strategy Paul Kennedy observed, productive force is “the single most important factor in explaining defeat or victory”.

By the end of the decade, defence experts are warning that Russia – an energy superpower – may possess a recapitalised armed force hardened by years of combat and a mobilised war-economy industrial base.

If the Kremlin judges that Britain and its European allies cannot sustain a prolonged war of attrition – that our production lines would falter before theirs – then deterrence weakens. The credibility of Nato, therefore, rests not merely on declarations of solidarity or headline spending pledges but on the capacity to endure.

In The Times, Juliet Samuels says that we are once again unprepared for a gas shock due to war in the Middle East.

Unfortunately, about ten years ago, Europe decided to get out of the gas financing business. Everyone from Mark Carney to the UN, Brussels and any Democratic state in the US urged investors and regulators to blacklist new fossil fuel investment and warned companies in the habit of building pipelines, finding gas or signing purchase contracts that the horrid stuff wasn’t wanted. Green tech was coming, they said, you’d better not get on the wrong side of history.

In the meantime, the plan was just to buy gas at whatever price was offered on the day. Predictable, long-term supply was stripped out of Europe’s most important energy market. Our prices are now set by the whims of LNG tankers — any way the wind blows (especially when it doesn’t).

Asia, by contrast, still signs decades-long contracts. This has the added advantage that when European prices spike, Japan or China divert the LNG they’ve bought at cheaper, pre-agreed prices to us and burn coal at home. This is one dynamic that explains why coal consumption is going up while gas stays flat.

For Conservative Home, Giles Dilnot says the government is not being honest that we cannot afford to pay for our own defence.

Rachel Reeves made a small reference to the unfolding situation in the Middle East at the top of her speech, but therein lies – at times literally – their problem. Not only are the Government being accused of vacillation and dereliction of duty defending our assets and denying their use to a key ally, but they also can’t pay – and have ignored questions about how they’ll pay – to be able to do so.

Conservative MP Ben Obese-Jecty asked the Chancellor this very question about defence spending. Rachel Reeves seemed to suggest that they had overseen the largest defence spending increase in years, and that was why “we’re degrading the capability of Iran to continue these attacks”

That’s news to everybody, because we aren’t, and the money hasn’t been spent, just promised. Word on when we might actually reach the point where it materialises is not to be found. It risks turning up as much too little too late as a British Type-45 Daring class Destroyer to the Mediterranean.

In The Critic, Charlie Cole documents the rapid rise in grants in British citizenship in recent years.

235,782 British citizenship grants were issued by the Home Office in 2025, with 78 per cent of these grants (182,778) going to non-EU nationals, with the top three nationalities being India, Pakistan and Nigeria. You might assume the spike in grants post-2020 are EU nationals acquiring British citizenship post-Brexit, however this is not the case, most grants have gone to non-EU nationals.

British citizenship grants are down from their peak in 2024, where 269,806 British citizenship grants were issued, the highest since records began. Britain has issued more citizenship grants in the last three years (2023-2025) than Japan has issued since 1967. Applications for British citizenship have been rising since 2020. There were 291,971 applications for British citizenship in 2025, the highest on record. For some comparison, there were 170,692 applications for British citizenship in 2020.

This is not the Boriswave acquiring citizenship, as they won’t have yet met the residency requirements, and pending Labour’s implementation of the Earned Settlement proposals, the bulk of the Boriswave will be prevented from acquiring Indefinite Leave to Remain and subsequently British citizenship until sometime in the 2030s.

On Substack, David Goodhart asks what is being done to preserve the way of life for the majority of people.

All the evidence we have from surveys and observation makes it clear that most people from the majority are happy to live in mixed places where their group continues to dominate numerically and minorities broadly fit in with majority ways of life. This can also happen in places far more diverse than Abingdon where the minority population is already more than one third—Reading, Watford, Milton Keynes and parts of Manchester might fit this description—places with large minorities and relatively comfortable levels of integration that could be the model for a future soft-landing.

What is meant by that phrase majority way of life—open to all comers—is hard to pin down but would include, as a minimum, common language (meaning fluent, idiomatic English), dress, and norms of public behaviour, some local attachments through sport/ media consumption, and easy mixing across lines of class and ethnicity in so-called third spaces (meaning neither home, nor work) such as pubs and cafes. At a national level it would include some sense of a shared history and Britain as a secular democracy but with a continuing attachment to Christian-influenced symbols and rituals, such as Remembrance Day or the 2023 Coronation, and some degree of emotional citizenship, with people feeling part of a common team and national story.

This majority way of life is something shaped by the White British but is fluid and evolving and open to people of all races and ethnicities who are also increasingly coming to mould it too.

For The Telegraph, Ben Marlow shows how our weak economy means we are uniquely exposed to the war in Iran.

That Britain remains this exposed to international markets and so reliant on foreign imports after the obliteration of living standards of the last few years is both unfathomable and unforgivable. Ministers have been asleep at the wheel.

There is a temptation to think much of this will be temporary, not least because most military experts believe the conflict will be short-lived. But that may prove to be wishful thinking.

Even if that is right, the pandemic and Ukraine taught us that prices shoot up much quicker than they come down. Inflation has fallen back sharply from the terrifying highs of 11.1pc in October 2022, but it remains stubbornly above the Bank of England’s 2pc target. After dipping below that level last year, it remains at 3pc, having bounced around for the last year or so.

The truth is, households are at the whim of an American government that gives the impression it is making things up as it goes along. Therefore no one can know how long the war will last. Even the White House can’t make up its mind, perhaps because it underestimated the speed with which it would be facing a broader regional war.

In The Times, Lord Finkelstein criticises the government’s decision to base foreign policy on narrow interpretations of international law.

Our position makes little sense diplomatically. It has been a major aim of the Starmer government to maintain a close alliance with the increasingly erratic American administration. In the long term we clearly need to be less reliant on the US but the prime minister judged that this would take time. Our position over Iran has made a mockery of his entire approach to the Trump administration.

It makes little sense morally. We are now engaged in a war we regard as illegal. We are not on the side of the Iranian people yearning to be free, nor on the side of the opponents of all wars. We seem to have lost a sense of who our allies are and who the enemy is. The cheers ring out from Tehran apartment blocks, while in Britain you hear the sound of humming and hawing. A massive war has broken out. It wasn’t at a time of our choosing, or in a way we would have planned, but surely we should at least know which side we are on. Australia does. Canada does.

And it makes little sense practically. It was obvious that if Iran were attacked it would lash out at its regional enemies and therefore at our friends. And obviously we would need to defend them. It’s ridiculous to think that the US could be in a war in Iran and that we would remain uninvolved. But now we have lost much of the goodwill that would have come with this involvement.

But never mind, at least we can justify our position legally.

For The Telegraph, Bob Seely says that the US is taking out Iran to send a warning to China on Taiwan.

For China, an aggressive Iran – like its other allies Russia and North Korea – is a useful vehicle for fixing the Western adversary and presenting so many diversions that the US risks becoming overwhelmed by multiple threats. It is to create, as the father of military theory Von Clausewitz would say, “friction”, tying down the American Gulliver and giving China global freedom of manoeuvre.

The Trump administration’s response has been dramatic. It is trying to deliver a shattering blow not only to Iran’s despicable regime, but also to China’s hopes of using the country to set the geostrategic conditions it needs prior to a potential Taiwan invasion. Taken in conjunction with Trump’s capture of Venezuela’s dictator Nicolas Maduro on January 3 – another major oil supplier to China – the US is knocking out China’s strategic diversions, cutting its tentacles one by one.

So, should China start to build up forces to invade Taiwan, the US carrier groups that Beijing would dearly wish to be tied down in the Gulf or off Venezuela can now be sitting behind Taiwan. The message the US is sending is: “China, we see you.”

On Substack, Andrew O’Brien says that getting closer to the European Union is not a solution to our economic weakness.

The Gorton and Denton by-election has put considerable pressure on the government to pivot towards progressive voters who are generally seen to want closer economic and political ties to the EU. The Iran War and ongoing situation in Ukraine has also created tension in the UK-US Alliance and made the EU look more favourable as a partner. There is also widespread concern amongst Labour politicians that the country lacks of a ‘growth plan’. Inevitably, in this politically and economically weakened state, the government is turning towards a closer economic relationship with the EU, and perhaps a pathway to rejoining, as a solution to these problems…

The EU would kill off any domestic reform agenda that seeks to rebalance our economy, and with it any chance for real improvement in living standards or spreading growth across our nation and regions.

The government is full of travellers wandering in the desert desperate for water, with closer ties to the EU looking like the only relief for miles around. But re-joining the EU or a custom’s union is not an economic oasis, it’s a poisoned well. We need to wake up and see our situation for what it is.

Subscribe now

Wonky Thinking

Onward has launched a new Energy Commission, with a foreword from the Shadow Secretary of State for Energy Security, Claire Coutinho MP. The Commission’s first report examines the suite of policy costs imposed by the state at various stages of the supply chain.

As well as driving gas scarcity, UK policy choices actually make bills higher directly, too. Onward analysis shows that through taxes, levies and subsidy costs passed through to billpayers alone, the state adds 30% – or £285 – to a typical household.⁵ And the state imposes costly carbon taxes and VAT on gas generators. These taxes add around 40% to the wholesale cost of gas, and 15% to the average family’s bill.⁶ These taxes on electricity generation could be cut almost immediately. This would make gas power cheaper – a vital first step in making electrification and decarbonisation of the wider economy affordable.

Finally, as well as taxing energy producers and imposing levies on suppliers, the state taxes the consumption of energy by businesses through carbon pricing and the Climate Change Levy. These policies are designed to incentivise industrial decarbonisation, but the reality is that they drive up electricity costs for businesses to unsustainable levels, leading to offshoring and industrial collapse.

The UK needs a radically different approach to energy policy, prioritising security of domestic supply and affordability for businesses and families. This will require more nuclear power, an economically sustainable and competitive renewables sector, and more abundant gas for the foreseeable future. It will also require reform of energy procurement, pricing and the auction system. Onward’s energy commission will address all these problems in turn.

In a new report, Higher Ground, Bright Blue outlines two principles and eight policies for how the centre-right can tackle the cost of living crisis for lower income households. The focus of the report is reducing the cost of housing and energy which the report says is making life increasingly unaffordable for large parts of the country.

This analysis presents a distinctive centre-right policy prospectus for improving the living standards of low-to-middle income households in the UK. This means focusing on driving down the costs of essentials, not just boosting incomes, to raise living standards. Low-to-middle income households are defined in this report as those with an income below the UK population median.

This report examines the trends in, and private and public impacts of, stagnant living standards in the UK over the past few decades. It then offers two distinctive centre-right principles to try and boost the living standards of low-to-middle income households:

● Abundance - Abundance is the plentiful supply of all things good. Public policy should make better and more frequent use of supply-side measures, promoting prosperity by producing more of what we value and ensuring its availability.

● Certainty - Avoidable uncertainty is self-inflicted through deliberate government choices. In recent decades, the UK has suffered from pervasive avoidable uncertainty, both politically and economically. Certainty in key essential markets can reduce costs that can lead to savings for low-to-middle income households.

The report focuses on costs rather than incomes as a means of improving living standards for low-to-middle income households. In the UK context, the need for — and potential impact of — lower costs is greatest in two essential markets: housing and energy. Housing and energy costs are the biggest areas of difference between the outgoings of low-to-middle and higher income households.

A new paper published by Policy Exchange calls for a new Politics of Production to replace the consumption and debt fuelled economic model that has weakened the country’s finances and abandoned communities. The report outlines the cost of our current system and the billions being sent overseas at a time of capital shortages at home.

Despite the way that it is reported in the media, Foreign Direct Investment is not a grant but giving away our future income. Debt must be repaid, future profits from firms that have been sold transfer income overseas. Slowly over time the share of our future income that we are promising away is growing largely and larger. Between 2009 and 2024, £468bn left the UK to go overseas in the form of rents, debt interest, dividends and share buybacks. This is equivalent to handing over money worth the entire economic output of Tyneside overseas every year. In the next few years, we are on track to be hand over the equivalent of Glasgow, our seventh largest city, every year. This £30bn a year (on average) is less money for households to consume, less to spend on public services or whatever else we would like to do with it. This is only going to increase in the years ahead.

A third of our national debt is now owned by overseas institutions, which means that £25bn was paid out in debt interest on long-term central government debt in 2024, compared with £11bn in 1997 (2024 prices). This is only going to increase further as inflation and gilt yields increase. Over a third (38%) of the total value (by turnover) of our non-financial businesses are owned overseas, up from 36% in 2017.

In our most productive sectors such as manufacturing, over half of our businesses are foreign owned. In growing sectors, such as professional services or creative industries, foreign ownership rates are growing faster than the rest of the private sector. This is unsurprising. Overseas investors are most likely to buy those assets that have the greatest value. The total stock of business share capital and reserves owned by overseas investors has increased by £500 billion in the last four years. The more they buy, the more of our future income we have promised away, the more we are reliant on foreign debt.

Subscribe now

Podcasts of the Week

The Institute for Fiscal Studies discusses how we can fix our broken fiscal rules which are holding the economy back and driving short-term decision making.

Subscribe now

Links

The Chancellor published her Spring Statement with lower growth forecasts.

New analysis shows the UK has never recovered from the financial crisis.

In every region poor white children are less likely to go to university.

The average income for the first-time house buyer has reached £61,000.

One in seven young Britons are not in work or education.

The Head of the Police Federation has been arrested on suspicion of fraud.

The US Supreme Court has unanimously ruled that federal courts must defer to immigration agencies on deciding what counts as “persecution” in asylum cases.

AI models are allegedly deliberating lying to their users.

Forty per cent of Britons have not read a book in the past year.

Kemi Badenoch has made a major speech on British integration.

Towering Columns

For The Times, Paul Goodman says the illegal practice of “family voting” may have determined the result in Gorton & Denton - and is a sign of things to come.

The practice sees voters joined by other people in the polling booth – often a husband joining his wife – in order to influence their vote: it’s a criminal offence. The practice isn’t confined to voters whose origins lie in Pakistan or Bangladesh. But it is scarcely unknown among them, if Democracy Volunteers are to be believed: in 2022, they claimed that some Bangladeshi-origin voters in Tower Hamlets, “generally men”, were inflicting the practice on others, “invariably women”.

An unseemly row has broken out between Manchester council and Democracy Volunteers about whether election officials were or weren’t notified – and whether they reacted if they were. And although the victorious Greens, with their aggressive courting of South Asian-origin support, are an inevitable target of conjecture, it isn’t yet clear which political party is most at fault: Labour fought the by-election energetically, and is no stranger to the darker arts of urban campaigning.

All the same, it is possible to believe, on the basis of the seat’s composition, the course of the election as a whole and yesterday’s turnout, that family voting swung the contest for the Greens – and deprived Reform of a sensational by-election victory. For if family voting warped voting at polling stations, where observers were present, imagine the scale of it in private homes, where there were none. But whichever party and campaigners are most to blame, this vicious, sectarian by–election – with its leaflets in Urdu, focus on events thousands of miles away, appeals to Muslim solidarity, anti-Indian propaganda, obsession with Zionism and not-so-latent anti-Semitism – is the shape of contests to come. The Gaza independents seized four seats from Labour at the last general election amidst accusations of electoral malpractice all round. Sir Keir Starmer’s Government set up a Defending Democracy Taskforce in the aftermath. Little has been heard of it since. There is a hole where a government anti-extremism strategy should be.

Also for The Times, Matthew Syed visited Gorton & Denton, discovering a case study of decline, distrust and Balkanisation.

Over in Longsight to the northwest of the constituency I glimpsed the other defining story of modern Britain: the consequences of mass immigration. The first four women I approached at the market didn’t speak a word of English; I got no further than a look of fear in their eyes, the only part of their faces I could discern beneath their burqas, before they were shepherded off by bearded men. I saw only half a dozen white faces among hundreds of shoppers on a cold Wednesday afternoon.

This isn’t multiculturalism; it is balkanisation. Like dozens of enclaves in northern towns and, indeed, parts of London, this area is dominated by Muslims; in this case, mainly of Pakistani ethnicity (the same as my late father). According to the 2021 census, more than six in ten residents identify as Muslim, the highest in the Manchester area. Progressives might say: “So what? Don’t you like brown people?” Er, I am a brown person. My point, though, is simple: how can it be good for immigrants, let alone the rest of the community, when there is a sharp divide between communities as if severed with a scalpel? How can it be conducive to their flourishing, to our flourishing, to the ethos of solidarity which is, after all, the rationale of that abstraction we call the nation state?

The irony is that many of the people I spoke to in Longsight concurred that this degree of separation is damaging. Rizwan, who works in a shoe stall in the market, said: “It would be better if more white people lived around here but they moved away and I doubt they are coming back.” I asked Saad, 23, who was shopping for an indoor rug, what he made of the fact so few of the older women here seem able to speak English. “It obviously isn’t good but that is the culture here,” he said. “The men do the talking.” But is this healthy? “Things are changing with the younger generation but it takes take time.” The highlight of my time here was meeting a 14-year-old who spotted me struggling to communicate with shoppers in the market and offered — with a twinkle in his eye — to translate. He was full of what you might call bantz. “Are you famous, bro?” “How much do you earn, bro?” Like quite a few of the Muslim kids here, he spoke with a curious synthesis of gangsta rap and Urdu lilt. “Why you keep talking like a rapper, dude?” I asked, causing him to dissolve into laughter.

In Compact, Benjamin R. Young unpacks Jason Burke’s analysis of how the revolutionary Left embraced militant Islam.

However, a simmering brew of religious fervor was beginning to boil in the Middle East. Sayyid Qutb, a radical Egyptian preacher and member of the Muslim Brotherhood, published a short book, Milestones, in 1964. Calling for Muslims to violently resist apostate regimes and the institutions of “World Jewry,” Qutb’s teachings became the intellectual cornerstone of the modern Islamist movement. Tapping into the anti-colonial rhetoric that resonated with left-wing radicals and Palestinian activists, Qutb’s conspiratorial theories jumpstarted a violent religious movement that would have long-lasting implications for the modern world.

Frustrated with Israel’s growing power in the region and the “apostasy” of US-aligned Arab governments, Middle Eastern radicals in the mid- to late 1970s abandoned the imported European ideology of Marxism in favor of homegrown Islamic teachings, such as Qutb’s works. Instead of reading the works of Mao and Che, they read Milestones and studied the Koran. Most of them became adherents of the most puritanical interpretations of Sunnism and Shiism. Although still full of revolutionary zeal, these extremists dropped communism for Islamism.

The Islamic Revolution in Iran demonstrated the revolutionary potential of Islam and its remarkable ability to transform a society overnight. Although a prominent religious figure by the mid-1970s, Khomeini spoke in terms familiar to many leftists: revolution, class, and the plight of the poor. The broad appeal of this blend of left-wing populist messaging with anti-Semitism and fundamentalist Shiism turned Khomeini into a national leader in waiting. Exiled by the Shah, Khomeini triumphantly returned to Tehran in 1979 and established the Islamic Republic of Iran.

For The Times, Juliet Samuel says UK universities are training five Chinese scientists for every British one - and empowering a strategic enemy.

It ought to be shocking that these venerated seats of science are contributing more to the next generation of researchers in a far-off country with a hostile regime than to the brilliance and enlightenment of their own countrymen. But aside from the warped norms of modern science, in which many scholars consider themselves above petty concerns like loyalty and national security, there is an obvious reason for this. At undergrad level, Stem courses cost more to deliver than universities are allowed to charge British students. Foreign students, by contrast, can pay their way. So, while the pipeline of Brits into advanced study is strangled, there is a vast surplus of foreign students ready to take their place.

The problem is that hosting thousands of Chinese engineers is very much not the same as getting in bulk batches of Canadians or Germans. The Chinese state has an official policy of “military-civil fusion” whereby all civil technology is put at the disposal of defence and security needs as well as technological espionage and economic coercion. Even if a vetting scheme could deal with this risk (which it can’t, because it’s a systemic problem arising from mutually incompatible and hostile political norms), Britain doesn’t have one remotely capable of doing so.

When UKCT tried to get details of how the Foreign Office checks overseas students, it was told the government would not supply China-specific data to avoid hurting “international relations”. Overall, the figures show about 1-3 per cent of applications are refused, but there appear to be yawning gaps. For example, the Foreign Office doesn’t ask Chinese students if they are members of the Communist Party. It doesn’t even seem to require them to record their names in Chinese characters and collects them only in Latinised “pinyin” form. This makes vetting using any Chinese-language resources impossible. I know because during an investigation of a dodgy, pro-Beijing figure some years ago, I came across a person of interest with a pinyin name that turned out to have 24 possible Chinese spellings, and the tantalising trail of breadcrumbs ended there.

In The Spectator, Gavin Rice says Trump may beat the Supreme Court on tariffs, and that “MAGA”-nomics is here to stay.

While the tariff programme is totemic, both in its audacity and its violation of economic shibboleths, in the context of the Trump Administration’s wider economic agenda it is far from the whole story. The MAGA movement’s drive to reshore supply chains and manufacturing jobs is partly about rebuilding national capacity in a fragmenting and more dangerous world, partly about reversing China’s global trade dominance and partly about restoring well-paid jobs to depressed regions. But it is also about a shift of Republican economic priorities towards production in the real economy, and away from the dominance of Wall Street.

Trump’s economic project, crafted primarily by J.D. Vance, Stephen Miran, Robert Lighthizer and Peter Navarro, is about a major internal pivot in America’s centre of economic gravity as much as a reset with the global trading order. The overriding thesis is that for too long the American economy has incentivised talent to flock to financial services, rewarded speculation, extraction and rent-seeking, and returns to real estate investment over the growth of productive, long-termist companies.

American workers, the argument goes, have lost out not only from Chinese mercantilist aggression, stripping jobs out of the South and Rust Belt, but also from a set of economic conditions that places them at the bottom of the pecking order. While returns to capital have soared over the last thirty years, returns to labour have been small by comparison – America’s overall higher wages notwithstanding. In the US – unlike in Europe, where productivity itself is the problem – productivity growth of around 60 per cent since 1980 has not been reflected in pay growth, which has been more like 15 per cent. Output and compensation have been diverging sharply.

On his Substack, Andrew O’Brien says Prosper UK has exactly the wrong diagnosis of how Conservatives need to change.

The Austerity Programme was a catastrophic mistake which accelerated a downward spiral that was already taking place. The books did need to be balanced but they certainly did not need to the dramatically balanced in a low-interest rate environment and the manner they were done was totally flawed. The Conservative Party had come to see the public spending of New Labour as pure waste, just a sop to voters. They could not accept that expanding public services and welfare was propping up a failed economic model that had deindustrialised and hollowed out communities. Replacing old industries with nothing. This was a model that the Conservatives had kicked off when they were last in government. Spending cuts, without a new economic model, worsened deep seated social and economic problems and was directly correlated to Brexit voting. The Coalition was New Labour but without any populist public spending, it would survive and fall purely on the strength of its governing philosophy. It fell.

The Conservative Party could not seriously countenance a new economic model because its Panglossian philosophy was the market was always right - this is what backing business meant. If the economy was the way it was, it was because that is what was right. There is no alternative. If businesses wanted corporation tax slashed, they should have it. If they wanted red tape cut, they should have it. If they wanted devolution, they should have it. The immigration system should be as liberal as possible to help them, providing it did not prevent re-election. The only areas they resisted were on planning and environmental regulation. The former where the ‘establishment’ consensus, including business, was to be seen to be green and the latter because voters did not want to be disturbed by new housing. It was necessary to reduce house building to appease the coalition that sustained the ‘back business’ mantra. The Conservative Party’s view was that the British economy was the best of all possible worlds. It was wrong.

On public services, we were not getting good value for money from spending, but that’s because public services were focused on picking up the pieces for a broken society (as Cameron himself identified). Yet we did not seek to fix that social model because it would have required a different economic structure which would have mean admitting business and the market was wrong. So public services are in a doom loop of ever growing demand but with little being done to tackle the fundamental causes of poor levels of education, anti-social behaviour, family breakdown etc. I do not honestly think that anyone can genuinely say that Britain was stronger and more unified in 2016. Events have shown the hollowness of the project. The Cameroonian’s two missions - electability and economic rejuvenation - both failed.

Subscribe now

Wonky Thinking

On his Substack, Neil O’Brien examines the statistical trends of internal migration, in-group preference and demographic shift within the UK.

In this post I have been looking mainly at the level of the local authority. But if we zoomed in further, we would see sorting at the neighbourhood level too - for age, ethnicity and education, compounding these trends.

I think these trends towards sorting matter for three reasons.

1. Disconnection within families.

A report from Onward found that between 2001 and 2020 the proportion of older parents (those aged 55 and over) living within 15 minutes of an adult child fell by 16%, (45% to 38%). The trend for people to sort into older places and for the age gaps to grow is one factor driving this.

As that report notes: “The effects of this variation on the quality of people’s relationships are considerable. Those living close to their family are much more likely to see them regularly: older parents are six times more likely to see their adult child daily if they live within half an hour of each other than if they live further away”.

The family WhatsApp group can’t substitute for proximity. This in turn has huge implications for the care of older people in our (ageing) society, and the use of paid-for social care.

2. Churn and lower trust

The UK model is lots of higher education and lots moving away from home for three years. That has obvious costs in terms of the large debts which so many young people now run up. But it also creates churn, with wider effects.

Churn and transience have political consequences. There is clear evidence that neighbourhood trust is higher the longer people have been in a neighbourhood. That same Onward report notes that:

an adult living in the same neighbourhood for over 30 years is… 15 percentage points more likely to believe that many of their neighbours can be trusted (50%) compared to someone who has been resident in the area for less than five years (35%).

I am of course not anti-mobility. Moving to opportunity is part of a healthy society. But in the UK we see surprisingly little sign of overall movement towards places where wages are higher, and that three quarters of of the local authorities that gain students, lose people overall. A lot of cities are churning but not attracting people in the long term.

3. Political balkanisation

This is maybe the biggest effect, and so I end where I started this piece.

Trends in the online world are certainly balkanising us. Once upon a time we might have read different newspapers, but at least we watched the same TV. About 37% of people in the UK watched the 1977 Morecambe & Wise Christmas Show. Today people have sorted themselves onto different platforms based on their views (Bluesky vs X.com) and even where they are on the same platforms, algo-driven spirals emerge where people are fed more of the same things they watch. If we watch TV at all, it’s on demand, and we get our news in many languages. Social media allows very immersive communities to emerge which can radicalise people in different directions and for different causes. People end up living in different information universes where the other tribe can do no right, while “we” can do no wrong.

There’s nothing so new about that - new forms of media allow people to form themselves into groups and drive change in new ways. Guttenberg invented moveable type, and boom, you had the Reformation and the Peasant War. As the man said, there are many such cases⁴. But the extent is greater than ever.

So if the same sorting happens in the real world too, then you start to compound these problems - you are less likely to be meeting people from outside your filter bubble offline. You have communities of rural oldies and young urban grads not mingling or meeting up. People start to say things like: “I don’t know anyone who voted for X”

And there is precedent for this - Bill Bishop’s book The Big Sort looked at how Americans were moving in such a way as to sort people into like minded communities. This had already had political consequences when he wrote in 2009 that:

“People with college degrees were relatively evenly spread across the nation’s cities in 1970. Thirty years later, college graduates had congregated in particular cities… In 1976, only about a quarter of America’s voters lived in a county a presidential candidate won by a landslide margin. By 2004, it was nearly half.”

Bill Clinton (no less) urged people to read the book and take steps to counter polarisation, but alas, the US only seems to have slid into hyper polarisation since.

Could the UK go the same way? Could that happen here?

Well, you be the judge.

Policy Exchange published “Putting Business Back in the Driving Seat”, by Zachary Marsh, Iain Mansfield, Lara Brown and Ben Ramanauskas, with a foreword by Shadow Business Secretary Andrew Griffith. The report calls for major reform of Equality, Diversity and Inclusion (EDI) policies so businesses can return to meritocracy.

Equality, Diversity, and Inclusion (EDI) is a conceptual framework which seeks to promote the fair treatment of all members of a workplace:

• ‘Equality’ refers to an employers assumed responsibility to treat all members of the workforce equally – regardless of their identity.

• ‘Diversity’ refers to the expectation that a company will deliver a diverse workforce – usually in terms of identities like gender, ethnicity, sexual orientation, and disability.

• ‘Inclusion’ operates on an assumption that some aspects of a workplace may exclude certain groups and that employers ought to take measures to make everyone comfortable. EDI is known by many terms – DEI in the US and quite often simply as ‘Diversity and Inclusion’. Increasingly the ‘Equality’ is replaced by ‘Equity’ – a word representing a belief that people with different characteristics should be treated differently in order to achieve equal outcomes.

EDI in the modern workplace emerged from anti-discrimination laws, introduced in response to the systematic and widespread discrimination which dominated the workplace until the late 20th century. In Britain, early examples include the Equal Pay Act 1970, the Sex Discrimination Act 1975, the Race Relations Act 1976, and the Disability Discrimination Act 1995 sought to end an era of discrimination in the workplace which saw minority groups discriminated against on the basis of their gender, religion, ethnicity or disabilities. Further, often well-meaning examples of what would now be referred to as EDI were frequently introduced by managers who wanted to create an inclusive and open workplace.

The evolution towards the modern conception of EDI occurred gradually, and alongside a broader changing perception of the role of the company.

In 2004 the World Bank produced the paper ‘Who Cares Wins’ which introduced the term ‘Environment, Social, Governance’ (ESG) into public conceptions of the modern company. Companies were no longer expected to simply maximise shareholder value. Instead, they were judged on their ability to maintain good working conditions, tackle discrimination, and promote environmental and social causes. Companies were expected to align their portfolios with guiding principles like human rights, working conditions, the environment, and anti-corruption – with major investors taking this into account when making investment decisions. As Policy Exchange has set out in Corporate Cancel Culture: How ESG came to rule our investments, ESG has grown into an extensive industry, with the global market for ESG data alone estimated at £1.5 billion.

Alongside this, many employers have gradually moved from policies designed to tackle discrimination, to policies seeking to further ‘Equality, Diversity, and Inclusion’ in the workplace. In doing so, modern EDI practices draws upon a range of intellectual and political traditions from both Britain and the United States, including the ‘affirmative action’ policies that arose from the Civil Rights movement, theories of ‘disparate impact’, in which a differing impact on two groups of people may be considered evidence of unfair treatment or discrimination, and approaches drawn from critical theory, which argue that differences in outcome between groups are the result of the unfair use of power and privilege. While laws and permitted practices vary between countries – in the UK, for example, ‘affirmative action’ is legally prohibited, with only the less discriminatory ‘positive action’ permitted – increasingly, instead of simply seeking to eliminate racial, sexual or other forms of discrimination, modern EDI policies will seek to actively promote diversity, and to overcome these perceived structural inequalities in society. Corporate studies and business literature have supported the drive towards EDI. In 2015 McKinsey & Company published ‘Why diversity matters’, a piece of research they conducted into the relative success of diverse companies.4 In the paper they claimed that:

• ‘Companies in the top quartile for racial and ethnic diversity are 35 percent more likely to have financial returns above their respective national industry medians.

• Companies in the top quartile for gender diversity are 15 percent more likely to have financial returns above their respective national industry medians (exhibit).’

McKinsey published four more pieces of research presenting the case that companies with more diversity of gender and ethnicity performed better: Delivering through Diversity (2018), Diversity Wins: How Inclusion Matters (2020), and Diversity Matters Even More: The Case for Holistic Impact (2023). Despite this, in March 2024 Jeremiah Green and John R. M. Hand revisited McKinsey’s claims and concluded that they could not be replicated.

John Miller and Lucy Parker, in their book the Activist Leader: A New Mindset for Doing Business, argued that

• To be a successful business leader in today’s world you are expected to deliver societal value alongside financial value. Not one at the expense of the other.

• And doing that takes a new mindset: the ability to think like an activist about the role your business plays in the world.

Further social developments, including the growth of genderism and trans ideology, the #MeToo campaign against sexual harassment in the workplace, and, in 2020, the death of George Floyd and the following surge of support for the Black Lives Matter movement, have all led to further developments in EDI policies and practices.

Support for EDI has become ubiquitous in the workplace. Business leaders, trade associations and major investors have championed EDI. Blackrock CEO Larry Fink’s influential annual letter to investors regularly asserted the importance of EDI and ESG – both an important signal of the acceptance of EDI in the corporate mainstream and itself a driver of further change. Training and monitoring of EDI has also become a major business. Many organisations exist to sell EDI to companies, either through training modules, toolkits on inclusivity, or the promise of auditing a company and rooting out any ‘systematic’ racism or sexism.

But what are the drivers on companies to adopt EDI policies? As this report will set out, the pressure on companies to promote EDI is both internal and external. Both central Government and regulators have imposed direct regulatory requirements related to diversity, whilst voluntary schemes and regular ‘reviews’ have promoted EDI. Many businesses have set up their own schemes to try and meet ever broadening targets. Internal pressure plays a similar role. Staff networks, activist employees, and human resources departments have contributed to the expansion of EDI.

This paper develops a taxonomy of how and why this imposes costs on business – and quantifies these costs where it is possible to do so. It then charts the causes of EDI overreach in the workplace and the external and internal pressures which have driven the adoption of such policies – and sets out how Government, regulators and business can take a more proportionate approach to treating employees fairly.

Subscribe now

Podcasts of the Week

On the Spectator’s Quite Right!, former Downing Street Head of Policy Munira Mirza says the fear of racism and the politicisation of Islam are distorting our politics.

On the Works in Progress podcast, Sam Bowman, Peter Garicano and Aria Schrecker discuss the causes of European economic stagnation.

Subscribe now

Quick Links

Independent election observers Democracy Volunteers found evidence of so-called “family voting” in 68% of polling stations, in violation of the Secret Ballot Act, in Gorton & Denton.

Labour sources complained their activists were intimidated by pro-Gaza protestors.

A Dutch man claiming to support Palestine Action has been arrested for desecrating the Churchill memorial in Parliament Square with anti-Semitic slogans.

A quarter of rough sleepers are not British, a report found.

BP is embarking on a new bout of shale drilling, in contrast to competitors.

The UK has per capita energy use that is almost half the developed world average.

Banning smartphones in schools led to a decrease in diagnoses of psychological disorders, a study found.

The Ministry of Defence has asked for an additional £2.5 billion to cover the cost of asylum for Afghans affected by the department’s data leak.

Towering Columns

For The Times, Ben Judah says that this government can do nothing until it has a plan to reform the failing state.

The state itself is failing. This is what I learnt in government. Discovering this in office has been a shock for my generation of Labour advisers and politicians. It’s not just, as the party believed in opposition, that the Tories, mired in impropriety, were failures. Slow, secretive and sclerotic, the government machinery itself is jammed.

Our good intentions, in a busted system, are not enough. You need scepticism, a plan and some history. When Labour came to power in 1964 it did so not only with a healthy suspicion of the state but a compelling critique. Such thinking has been sorely lacking this time round. As a result, we have ceded any critique of the civil service and the state to Dominic Cummings and Danny Kruger.

Labour back then revolutionised political appointments with special advisers — the Spads without whom you can’t imagine Whitehall — and used Nicholas Kaldor, the leading economist of his day, as an adviser. They even sought to break up the Treasury with a new Department of Economic Affairs. Obviously, 60 years on, not all of these ideas have stuck but they met the measure of their age.

On Substack, Tom Tugenhat calls for a whole-of-nation response to a rapidly changing world.

Air Chief Marshal Sir Rich Knighton, the Chief of the Defence Staff, has said that the current threat environment is more dangerous than at any point in his career and that responding to it requires a whole-of-nation response: building industrial capacity, growing the skills we need, and increasing the resilience of society and the infrastructure that supports it.⁴ That language is not routine. It is a serving military chief telling the country that defence is no longer a problem the armed forces can solve alone.

Building that consensus requires honesty. The British public has not been told clearly what the country faces, what it will cost, or what the consequences of inaction would be. Governments of both parties have preferred reassurance to candour. That must change and that’s why I’ve been writing these articles. The public are not children. They can weigh difficult choices if they are trusted with the facts.

Four pillars of British defence were dismantled in fifty days. They will not be rebuilt on the same foundations. The assumptions that sustained them, American constancy, allied automaticity, strategic predictability, political convenience, belong to a world that no longer exists. The only real question is whether Britain builds something new before events force our hand.

For The Critic, Jethro Elsden warns that we are facing another lost decade like the 1920s.

It was reputedly Mark Twain who said that “history doesn’t repeat itself but it does rhyme”. So far the 20’s have been rhyming strongly with that of a hundred years ago; just as today the 1920s were a decade which began with a global pandemic, marked by political turmoil in the UK, a new party rising to prominence and a near constant churn of prime ministers. And now the 2020’s are on track to be the worst for economic growth since the 1920’s.

While the 1920’s saw truly anemic growth of just 0.8% per year, we’re hardly doing much better, with average growth per year of just 1.1% since 2020. What’s worse is that unlike in the 1920’s we lack the explanation of having just been through one of history’s most destructive wars or made the mistake of reentering the Gold Standard at the wrong rate, or had the disruption of a general strike like that in 1926.

While it’s true that Brexit (and more importantly the drawn out process after the referendum) has been somewhat disruptive and the pandemic caused significant damage, an inherently strong and healthy economy would have shrugged these setbacks off and caught up with strong growth. But that hasn’t happened.

On Substack, Andrew O’Brien argues that Conservatives cannot go back to the ‘coalition years’.

The Austerity Programme was a catastrophic mistake which accelerated a downward spiral that was already taking place. The books did need to be balanced but they certainly did not need to the dramatically balanced in a low-interest rate environment and the manner they were done was totally flawed. The Conservative Party had come to see the public spending of New Labour as pure waste, just a sop to voters. They could not accept that expanding public services and welfare was propping up a failed economic model that had deindustrialised and hollowed out communities. Replacing old industries with nothing. This was a model that the Conservatives had kicked off when they were last in government. Spending cuts, without a new economic model, worsened deep seated social and economic problems and was directly correlated to Brexit voting.

The Coalition was New Labour but without any populist public spending, it would survive and fall purely on the strength of its governing philosophy. It fell.

The Conservative Party could not seriously countenance a new economic model because its Panglossian philosophy was the market was always right - this is what backing business meant. If the economy was the way it was, it was because that is what was right. There is no alternative. If businesses wanted corporation tax slashed, they should have it. If they wanted red tape cut, they should have it. If they wanted devolution, they should have it. The immigration system should be as liberal as possible to help them, providing it did not prevent re-election. The only areas they resisted were on planning and environmental regulation. The former where the ‘establishment’ consensus, including business, was to be seen to be green and the latter because voters did not want to be disturbed by new housing. It was necessary to reduce house building to appease the coalition that sustained the ‘back business’ mantra. The Conservative Party’s view was that the British economy was the best of all possible worlds. It was wrong.

For The Critic, James Mackenzie Smith discusses the possibility of British sovereign debt crisis.

That said, recent volatility in international bond markets — including that seen in Japanese government bonds — combined with a deteriorating global perception of Britain as a stable jurisdiction, mean this is not an entirely theoretical event. Moreover the UK, which runs both consistently high fiscal and current account (trade) deficits, is structurally vulnerable, with natural demand for UK government bonds (gilts) declining as domestic pension funds roll off their holdings.

From a risk management perspective even a moderate likelihood of a debt crisis — combined with what would be catastrophic ramifications — necessitates a response plan. It is for this reason we ran a series of working groups on this subject, with our recommendations published last November, detailing how the Government must respond if the markets decide to strike.

A crisis could be triggered by any number of events: a significant deviation from the Chancellor’s “fiscal rule”, a credit rating downgrade, a failed gilt auction, or even a “black swan” geopolitical shock. The risk of a less fiscally prudent administration following a change in political leadership should not be discounted by investors, either.

For The Times, Nick Timothy attacks the government clamping down on legal transparency.

The government claims access to court information for journalists and the public has not been affected, and that listings and records remain available. But, as the investigative reporter George Greenwood wrote in The Times, “this is simply untrue”. He explained that because he can no longer search the records by keyword, crime type or court, “journalist access to court records has certainly been affected”.

If we want to stop the rape gangs permanently, as we must, the first critical step is transparency. Ministers should be making every effort to get more data and more information into the public domain. But they are not. This matters, because without transparency there can be no accountability, and without accountability there can be no justice.

Yet the government is attacking this transparency. And in so doing it is entrenching the culture of opacity that allowed the rape gangs to go unpunished. Without this archive many more cases will escape scrutiny and lives will be destroyed. Whatever the motive for the government deleting this archive, it is not too late to change course. Lammy must stop this plan to hide the facts. For justice to be done, we must all be given the truth.

For The Critic, Daniël Eloff writes about the paralysis created by excessive legalism.

Human rights governance systematically transfers risk downward. Moral authority, reputational insulation, and legal protection accumulate upward among the professional classes who design and administer the system. Material consequences accumulate below. Elites encounter failure as procedural friction like another court challenge, another policy refinement or another interpretive debate. Communities encounter it as unemployment, crime, electricity blackouts, and collapsing services in South Africa, and as strained policing, unmanaged migration, housing shortages, and declining public order in the UK. This asymmetry explains the widening gap between governors and governed better than ideology alone. Those most fluent in the language of rights are also the least exposed to the costs of governing by them.

Rob Henderson’s term “luxury beliefs” describes ideas embraced by elites that impose costs on others. Transformative constitutionalism in South Africa is a textbook example — with one essential difference. These luxury beliefs were not merely expressed, they were enforced. They became procurement rules, hiring criteria, and regulatory thresholds. Their costs were borne by the poor (overwhelmingly black) while their moral prestige accrued to the professional classes who designed them.

This might be called a form of jurisprudential toxic compassion: the prioritisation of emotional reassurance over long-term consequence. The language of transformation comforts those who speak it — signalling virtue and absolving guilt — but it does not fix roads, keep the lights on, or build capable institutions.

In The Times, Melanie Phillips writes about the recent ruling that Palestine Action was not a terrorist organisation.

Perhaps the most disturbing aspect of the ruling was its conclusion that proscription was “disproportionate” because “the nature and scale of Palestine Action’s activities falling within the definition of terrorism had not yet reached the level, scale and persistence” to warrant it.

Yet since August 2024, the group had been responsible for 158 “direct action events”, 28 of which had caused damage to property exceeding £50,000 or were events that had required significant police presence. And the court itself noted that the group “encourages the causing of more, rather than less harm … a risk that’s all the greater, because the manual encourages everyone to take matters into their own hands”.

So must the government wait until more people are injured or someone even gets killed by these activities before the judges agree that such a terrorist group should be banned?

In The Telegraph, Allister Heath says a new right-wing government must be prepared for fierce resistance.

Sensible compromises are necessary. French populists have been defeated repeatedly because the middle classes feared for their money under a Marine Le Pen presidency or a euro Frexit: the British Right must never lose the support of prosperous Middle England. It must always protect their wealth.

Ensuring it cannot be attacked on macroeconomics will give a Right-wing government the latitude to fight back on every other front. It will certainly be vicious. Leaving the European Convention on Human Rights (ECHR) and United Nations conventions, vital policies, will be met by a campaign to render the UK an international pariah. Abrogating the Equalities Act will infuriate the Left, while slashing welfare and ending gold-plated public sector pensions will lead to a 21st-century version of the miners’ strikes by the nation’s bureaucrats.

There will be endless judicial activism and a constitutional crisis will surely be engineered. Sir Keir Starmer’s Brexit betrayals will need to be reversed, triggering a trade war with Brussels. An Alexandria Ocasio-Cortez or Gavin Newsom presidency in the United States will be weaponised against a Faragiste or Badenochite British government, with sanctions a possibility.

Naive Right-wingers must stop underestimating the viciousness and power of the status quo forces arranged against them. Winning the election will be tough but merely an early battle in a lengthy war to seize control of a hostile, blue-pilled British state, supported by a radicalised establishment. Without the right plan, it will all be for nothing.

And finally…Henry Hill moves on as Deputy Editor of Conservative Home. In his last article, he questions whether the party has learnt the lessons from its time in office.

The Tories failed for broadly the same reasons that Sir Keir Starmer is failing now, although the specifics are different. Ultimately, there was nothing resembling a proper governance project, and thus nothing to counteract the continual temptation to make the easy short-term decision and hope for the best.

Spending went up, planning applications were blocked, prisons were closed for economic reasons, and eventually we woke up in the future, which turned out to be populated not by the better, braver people to whom we had delegated the difficult decisions but by us, and the consequences of our actions. One is put in mind of this passage by Joan Didion:

“That was the year, my twenty-eighth, when I was discovering that not all of the promises would be kept, that some things are in fact irrevocable and that it had counted after all, every evasion and every procrastination, every mistake, every word, all of it.”

Sadly, the capacity of today’s leaders to evade this revelation far exceeds hers, and there remains too little evidence that the party has really grasped this problem. Badenoch has finally found her feet as leader and made some sensible policy interventions at conference, but on the big strategic questions the evidence is mostly bad. The Conservative Party remains committed to both the pensions triple lock and an un-means-tested Winter Fuel Allowance, two of the most obviously correct spending cuts of which it is possible to conceive. Meanwhile if the Tories actually have a housing policy, James Cleverly is being very quiet about it.

None of this is entirely the party’s fault. Our increasingly fragmented party system affords the electorate one refuge from reality after another; where once the consecutive failure of both the major parties of government might have created space for a radical break with the status quo, today there are always others – Reform UK, or the Greens – prepared to pretend that the country can be fixed by way of painless decisions and the targeting of baddies. The best that can be said of them is that, since Downing Street increasingly resembles a machine for destroying its occupant, if they take office by such means they will deserve it.

Subscribe now

Wonky Thinking

Neil O’Brien has published a new ‘Welfare Atlas of Britain’ on his Substack. The atlas shows how over £100bn in working age welfare spending is distributed across the country by local authority, parliamentary constituency and at a neighbourhood level.

O’Brien analyses the data and concludes:

Before coming to office in 1997 Tony Blair promised to cut what he called “the bills of social failure” - and while the welfare bill actually went up on his watch, at least his argument was right - taxpayers’ money that you are spending mopping up problems is money you aren’t spending on preventing those problems.

Obviously we can’t just overnight shift all of the large bill for working age welfare into more productive uses. But over time we need to control welfare spending if we want to have the money for other things that can get the economy moving.

I have written before about getting growth going in poorer places and spreading opportunity. People sometimes moan about poor places receiving lots of taxpayers’ money - but the truth is that that money often comes in a form (welfare) that doesn’t help change their trajectory. It may even compound it in some cases.

The Starmer government is showing how limited the room is for tax increases, with the economy sagging most in the sectors hit by the biggest tax hikes. More tax increases will be counterproductive. So if we want the firepower to fix broken places, we need to look to control spending instead. If we could cut the ever-growing welfare bill then maybe we could get somewhere.

Subscribe now

Podcast of the Week

On The Winston Marshall Show, Lord Andrew Roberts debates the long term consequences of Labour’s victory in 1945 and the illusion of prosperity created by overseas debt and Keynesian economics.

Subscribe now

Quick Links

Households with migrants are receiving more than £15bn in Universal Credit.

Illegal migrants are given £6.5k each in compensation for having their phones seized when crossing the Channel.

Tackling immigration is the top priority of UK voters.

President Trump calls for Chagos Island deal to be cancelled.

The Prime Minister has appointed Antonia Romeo as his second Cabinet Secretary.

Unemployment rises to over 1.8m people in the three months to December 2025.

Youth unemployment rises to a 11-year high.

Job creation is not keeping up with increases in the working age population.

A third of business leaders say that they will cut recruitment due to tax rises.

The government u-turns on cancelling local government elections.

The Prime Minister’s National Security Adviser refuses to become his Chief of Staff.

Towering Columns

In The Times, Juliet Samuel argues that many of our politicians cannot resist the allure of wealth and status.

These types are lured by histories or TV dramas into the political arena. Some of them make it to “the top” and suddenly see it isn’t the top. Layers of elites stretch into the distance above them — and they think they’ve joined the club. There they are at Davos with the special badge, being flown around and asked for advice, handed cash and holidays. And while they are in office, the donors can usually be fobbed off with the odd conference call. They don’t get to dictate specific policies (a rude awakening for some) even if, as a class, they have some power over the direction of travel. But this can give the politician the illusion that he himself is the sole author and owner of the life he’s living.

Then, they leave office. Some, like Theresa May or Gordon Brown, are only too happy, even relieved, to retire into the milieu they know. But others see in the world of globally hobnobbing oligarchs, dictators, financiers and heirs a game they desperately want to keep playing. Often, it’s a game on a scale they didn’t even know existed before.

The problem is that to do that, even just to remain as relevant “staff” for the top echelons, they need very, very large sums of money. And in a relatively non-corrupt society like Britain, politics is not a good field in which to make money. In fact, compared with many other fields an ambitious person could go into, like finance, business, law or even media, it’s uniquely risky to make serious money from politics. Even worse, in a democracy, leaders have only a limited window in which to parlay their brief status into the wealth needed to gain permanent membership of the super-elite.

Not everyone can be a Tony Blair (though one wonders what we’d find if caches of BlackBerry messages had existed earlier). George Osborne has so far collected various advisory roles without too much controversy. Boris Johnson has had some minor run-ins but has enough celebrity to work a lucrative speaking circuit. But David Cameron’s attempt to lobby for Greensill, the collapsed lender, snookered his career after office. Various senior civil servants, including Sir Simon Fraser, Sir Andrew Cahn and John Suffolk, have sold their services to Huawei.

What currency did Mandelson have? His best assets, such as the ability to help out with passports, to influence policy or to share privileged information, declined fast once out of office. This explains why he appears to have routinely taken the incredible risk of directly forwarding sensitive, market-moving government emails to a finance guy convicted of child sex offences.

In UnHerd, Mary Harrington argues that the global elite have become morally detached from the rest of us.

Now, whether it’s the influence-peddling or the snapshot in his scanties, the game seems to be up. Now, the once apparently unassailable “Prince of Darkness”, already fired as Keir Starmer’s man in Washington due to Epstein ties, has resigned from the Labour Party and declared that he won’t be returning to the House of Lords. Starmer, ever on the communications front foot, responded to this statement by indicating he does not think Mandelson should sit in the House of Lords.

So that’s all fine then. Except it isn’t. There is no suggestion that Mandelson was implicated in sexual abuse. But the girls were never the main action anyway. For what’s also clear is that Mandelson was just one actor in a sprawling, incestuous web, that will outlive Epstein, and in which I suspect the household-name celebrities and public figures currently making headlines (and headaches for the Prime Minister) often counted for less in power-broking terms than those less high-profile but seriously influential in politics, finance, or law. For some in this group, raping trafficked children may have been a fun diversion. But the real frisson — and Epstein’s real work — lay in the subtler and more varied trade, in things that money can’t buy.

The nihilistic overclass of transnational kleptocrats and their hangers-on Epstein catered to in this occult marketplace operated, and still operates, at a level where political principle simply does not feature, let alone the moral or spiritual kind. There’s only whatever you want, and whatever strings you are willing or able to pull for someone else, in exchange for it. This was the real feast; those poor violated girls were just the amuse-bouche.

In The Times, Gerard Baker says that Epstein is a window into the everyday corruption of globalisation.

It was ever thus, you will say. That’s how business has always been done at the top — and that’s true. But two things are different about the way this has worked in the past 20 years: the sheer scale of the wealth and opportunity unleashed by the globalisation of finance especially (it’s why Americans and Brits dominate these lists of names — they come from the two leading financial capitals of the world); and the absence of any real regulatory framework to restrain it in the ascendancy of the neoliberal economic order. The rewards to be had from making the right connection, untrammelled by legal restraint.

Most of this is perfectly lawful — that’s the point of an unregulated system. But the advantages gained from a connection available to no one else mean the playing field isn’t level. It can be manipulated by invaluable information the network provides you.

And some of what goes on is probably neither fair nor legal. We only know now about how Mandelson is alleged to have shared valuable information with Epstein because of the latter’s criminal depravity that led to his exposure. How many other exchanges are taking place daily that will never come to light?

The irony is that the populist revulsion at this network of mutually back-scratching elites resulted in the rise to power in the US of someone who was once a member of them and who still essentially acts like one. (It’s not true, by the way, that the Epstein story has had little fallout in the US. Many an American titan has been felled by the revelations. The endless search for the smoking gun on Trump himself is probably futile: whether by fortune or judgment, he does seem to have ended his connection with the man after his conviction in 2009.)

Yet as the network gets more money and more power — and those outside it lose more and more ground — a real populist backlash is surely inevitable.

In The Telegraph, Trevor Phillips writes how our legal system has been corrupted by the rich to silence their critics.

Legal bullying now threatens many who are not rich and privileged. The UK Anti-SLAPP Coalition, co-founded by Index on Censorship, has documented SLAPPs brought against survivors of sexual violence by their attacker after the criminal justice system failed them and they went public to warn other women.

We have reported on former patients of cosmetic surgery who posted negative reviews to inform others considering going under the knife, only to face legal actions and damages claimed at £10,000. We’ve seen a victim’s advocate threatened by the very crypto-fraud they had lost money to, just because she didn’t want others falling into the same trap she had.

And even success against a SLAPP can carry a cost. Nina Cresswell who successfully beat a legal action brought against her by the man who sexually assaulted her told us that the SLAPP “took three years of my life fighting and I will never be the same again.”

The Government has promised to tackle SLAPPS. But to date we only have flawed and narrow protections in the Economic Crime and Corporate Transparency Act, which only cover reporting on economic crime and depend on an excessively restrictive definition of SLAPP, which can easily be side-stepped.

For The Times, Jonathan Ames argues that we must protect our juries from external pressure.

Juries can be mercurial. There is no better illustration of this than the verdict at Woolwich crown court in London this week in the prosecution of six Palestine Action members.

The activists were accused of causing more than £1 million of damage to an Israeli defence company’s British factory, and leaving a female police officer with a fractured spine. After deliberating for more than 36 hours, the jurors acquitted the six of aggravated burglary while failing to reach verdicts on counts of criminal damage, violent disorder and assault occasioning grievous bodily harm. A retrial is now a possibility.

Many who have seen the video of their arrest, which was entered in evidence, will consider that verdict perverse. Astonishment is a fair reaction. But it should be remembered that a two-minute video clip cannot be equated to sitting through hours of evidence presented during a criminal trial.

Still, the latest verdict will recall the furore over the 2022 acquittal of four protesters accused of criminal damage by throwing a statue of Edward Colston into Bristol Harbour.

There is clearly public disquiet. But what the trial of the Palestine Action activists highlights is the need for criminal trials to be held in appropriate circumstances free of potential outside influences. The judge at Woolwich was forced to remind jurors to ignore the noisy commotion caused by protesters outside the court building.

For The Telegraph, Rory Geoghegan documents how we have stopped protecting police officers from violence.

In the past week, it has been reported that no one was convicted following a break-in by Palestine Action protesters at an Elbit Systems factory near Bristol in 2024. This was despite a police officer being hit with a sledgehammer, fracturing her spine.

This was not a minor scuffle. It was an attack capable of causing life-ending or life-changing injury. We also heard from Ned Donovan, a former special constable who intervened while off duty to apprehend a thief on Westminster Bridge and was violently assaulted.

His case sat gathering dust for four months, as the DNA went unprocessed and CCTV images uncirculated. The glacial pace of the investigation and subsequent failings prompted him to pen an open letter to the Metropolitan Police Commissioner, Sir Mark Rowley, laying bare the failings and demanding better. These are not isolated cases: they just happen to be high-profile ones. Even when assaults on police officers do make it to court and defendants are convicted, outcomes are often derisory. I remember the first time I was assaulted as a serving officer. A seasoned colleague advised me not to expect much – the going rate for having a crack at a copper was widely understood to be a £50 fine. He was right.

In The Times, Melanie Phillips writes that liberal universalism has warped Britain’s foreign policy.

In the conflict between Israel and Hamas, Powell has been lobbying for Hamas to keep some of its guns. This is to break the deadlock in which the Islamist group is resisting President Trump’s demand for “demilitarisation” before the next stage of his Gaza peace plan can be reached.

This has echoes of the Northern Ireland peace process but using the Good Friday Agreement as a kind of global counterterrorism template is a category error. The IRA wanted a united Ireland. Unlike Islamic jihadis, they did not want to destroy Britain and kill or conquer everyone there.

Powell denies the desperate unwisdom of negotiating with people who have fanatical, absolute and non-negotiable agendas. But Islamists or Chinese communists don’t suddenly become convinced of the benefits of pragmatism. They become convinced instead of the endless gullibility or amoral cynicism of western diplomats bent upon making concessions which these implacable foes rightly perceive as weakness.

Powell’s world view — shared by Starmer and the attorney-general, Richard Hermer — is shaped by the liberal universalists’ perfect faith in negotiation, compromise and legal process, based on their arrogant assumption that everyone in the world thinks like the West and is accordingly governed by self-interest.

The idea of actually defeating bad people with absolute agendas, which might involve things like “principle”, “victory” and “surrender” and even require people to fight and die for freedom and justice, are to be dismissed as evidence of inferior intellect and moral deficiency.

In The Telegraph, Philip Johnson spotlights the growing sectarianism corrupting our electoral processes.

Once again, the spectre of sectarianism is stalking British democracy. At the last general election four candidates standing on a specifically pro-Palestinian platform won seats in parliament.

Sectarianism is a new departure for elections in England, if less so in other parts of the UK such as Northern Ireland and Scotland where divisions between Catholics and Protestants have for decades determined voter preferences in some seats. Liverpool, with its two cathedrals, was the one English city divided along similar lines but it has largely moderated.

Decades of immigration from the subcontinent has seen pernicious new ethnic and religious tribalisms emerge, the antithesis of the assimilation needed to forge a national identity. They are exploited by ideological Islamists in an unholy alliance with the far-Left with whom they share little, other than a desire to undermine our institutions and our way of life.

Yet at this perilous moment, the Government is preparing to reveal the outcome of its lengthy consultation on what constitutes so-called “Islamophobia”. The draft wording was disclosed a few weeks ago, defining “anti-Muslim hostility” as “harassment and intimidation whether physical, verbal, written or electronically communicated, which is directed at Muslims or those perceived to be Muslims because of their religion, ­ethnicity or appearance”. Such hostility would also include the “prejudicial stereotyping and racialisation of Muslims, as part of a collective group with set characteristics, to stir up hatred against them, ­irrespective of their actual opinions, ­beliefs or actions as individuals”.

It has taken a committee a year to come up with this definition and ministers have promised an announcement shortly – presumably before the Gorton and Denton by-election in a bid to win some of those Muslim votes back.

And for The Telegraph, Robert Jenrick questions the Prime Minister’s decision to pursue our soldiers in the courts.

Of course, improving his own lot at the expense of his country’s long-term security is nothing new for this Prime Minister. His legal career was founded upon so-called human rights claims that undermined our Armed Forces. He claims he was obliged to accept such work but as The Telegraph revealed this week, he worked with the disgraced solicitor Phil Shiner for free.

His work “challeng[ing] the government over the reach of its anti-terror legislation and taken on the British military”, according to The Guardian, led to his appointment as Director of Public Prosecutions and subsequent political career. The question is, will Starmer be allowed to repeat the trick of enhancing his own career at the expense of his country’s interests?

To boost our country’s growth and living standards, the Prime Minister doesn’t even need to fly to Beijing to offer himself as tribute. One of the fallacies of globalisation was that manufacturing could be outsourced to the East, but Britain could remain a powerhouse of innovation. The idea was that companies like Dyson could make their products overseas, but bright sparks here could continue to design them all thousands of miles from the production line. It doesn’t work like that. The two are too inextricably linked, as every Western economy has now learnt to its cost.

Subscribe now

Wonky Thinking

New research from Onward has found that people already claiming Universal Credit are getting £10bn in additional payments and free services on top of their benefits, reducing the effectiveness of the system as a means of incentivising work. The report calls for “radical rationalisation” and returning to the guiding principles of Universal Credit, particularly encouraging independence and resilience.

An expansive menu of extra payments and freebies for those already receiving benefits is weakening work incentives at a staggering cost of £10 billion. Working age benefit claimants negotiating this sprawling system are met with incoherent rules fragmented across over a dozen different schemes. This paper is the first systematic review of the costs of all benefits passported through receipt of Universal Credit and their average value to those claiming them. Alongside discretionary local schemes, this paper reveals how they collectively total over £10 billion in additional working-age welfare on top of Universal Credit payments.

From its inception, the purpose of Universal Credit was to create a simplified benefits system where people were always better off starting work, taking on more hours, and progressing in their careers, rather than staying on benefits. It promised to consolidate payments into a simpler single award, smoothing out the cliff edges that saw support sharply withdrawn once you worked a certain number of hours or earned a certain amount. It was meant to save taxpayers’ money too.

But, thirteen years on since the rollout of Universal Credit began, it has become anything but a single, universal payment. The benefits system for those of working age has ballooned in size, scope and cost. Reform that was meant to streamline multiple income-replacement legacy benefits has instead carried over and expanded multiple sub-schemes that are accessed by virtue of already being a claimant. These are collectively known as “passported benefits”: benefits for which eligibility is conferred via another benefit for which eligibility requirements have already been met.

A two-tier benefits system has been created: one in which savvy claimants can gain thousands of extra pounds a year, but those with the least awareness or capacity still miss out on support. Jagged cliff edges have been carved, whereby being on benefits grants access to a wide array of top-ups, but reaching certain earnings levels risks suddenly losing these too. For everything from children’s meals to energy bills, there is an associated concession largely or exclusively for benefit claimants, almost half of whom are not required to look for work at all. In turn, passported benefits have created a deeply unfair two-tier state, where many of those just beyond benefit eligibility are fundamentally worse off than many claimants.

To avoid political fights, successive governments have ended up double-handling certain living costs through passported work-arounds. Policy failures have been mitigated with more bureaucracy, rather than addressing the drivers of the high prices that affect everyone. Worse still, pervasive passporting has made it more rational to remain a client of the state rather than struggle through the jobs market, risking losing bonus entitlements once in work. Paternalism has triumphed over aspiration, undermining the core purpose of working-age welfare reform.

This paper exposes the value of these schemes to claimants, the cost to taxpayers and consumers, and the cumulative effect on incentives for claimants to work at all and to progress in work. It proposes a radical reshaping of this area of state support, creating a welfare system with greater certainty, consistency and simplicity for claimants, and better value for the taxpayer.

On the Prosperity Institute’s Substack, Alexander Baker discusses the 200-year decline of our jury system and the need for the Right to not just defend a failing status quo but put forward genuine measures to fix it, including strengthening juror qualification.

The role of the jury in Britain’s legal system is grounded in centuries of practice and can arguably trace its roots back to Magna Carta, if not further. Many have traced its emergence over the past thousand years of English history—Ed West has an excellent primer on his Substack.

Yet the system has already previously undergone major reform along the lines proposed by Lammy. At the start of the nineteenth century, trials for most criminal offences, including all felonies and serious misdemeanours, involved a trial on indictment before a jury.[2] The most common indictable offence at this time by far was larceny, with a court return from 1838 showing that of 23,094 persons committed for trial, a total of 15,915 or 69 per cent had been charged with some form of larceny.

However, growing case numbers were starting to put serious pressures on the justice system— a problem not too dissimilar from our contemporary woes. The preference for pre-trial detention over bail meant that more suspects were being detained for longer periods of time. The expense of criminal trials was also rising, with counties paying one-fifth of the country rate (a partial precursor to Council Tax) to the payment of prosecution expenses in 1834. By the late 1840s the Treasury, which had taken over covering these costs, was spending an eye-watering £400,000, roughly one percent of the total expenditure of the state.[3]

Unsurprisingly, pressure grew to transfer some of the burden from juries to judges in the Summary Courts. Yet despite the above defects being widely acknowledged, proposals to transfer jurisdiction met with stubborn opposition. The arguments were manifold. The quality of justices varied, with many qualifying by virtue of property ownership and having no legal training. There was also a perception that justices favoured harsher sentencing practices, known as the ‘Justices’ justice’. To address these concerns, reformers suggested that expanding summary jurisdiction include several safeguards, such as ensuring that the power of the Summary Courts should only be exercised by two or more magistrates, or that penalties imposed by justices could be limited to six months imprisonment.

Legislative reforms also contained provisions allowing a defendant to object to a summary trial. Provisions in the Criminal Justice Act 1855 required a justice to specifically ask a defendant whether they objected to a summary trial, a system which evolved into our modern category of ‘either-way’ cases (crimes triable in either magistrates’ or Crown Court).

Despite opposition, and the fear that, in William Blackstone’s words, “the new and arbitrary methods of trial… may in time imperceptibly undermine this best preservative of English liberty”, the Criminal Justice Act 1855 passed.[4] A year later, committals for trial by jury had dropped by 25%, with most of the decline being due to a drop in committals for larceny. Between 1855 and 1900, annual committals for trial more than halved.[5]

The legal scholar Douglas Hay noted that “from being the epitome of English criminal law in the eighteenth century, the jury trial became the little used symbol of it in the nineteenth”.[6] The decline in the use of jury trials has continued to present day, with around 90 per cent of all criminal cases now being handled by the magistrates’ courts.[7]

What should contemporary conservatives make of this historical precedent? The broad tone of opposition to the Justice Secretary’s proposed reforms today (proposals in step with frustrated party ambitions dating all the way back to the first Blair premiership) is that they are an unprecedented assault on ancient rights, and merely the next step in a thirty year project of Blairite constitutional vandalism. Yet this position is hard to sustain given that the biggest blow to the widespread use of trial by jury was struck not by David Lammy but by Lord Palmerston.

One is of course free to argue that the mid-nineteenth century criminal justice reforms were a reckless act of Whiggish innovation, and that we must turn the clock back to restore a judicial settlement which even most of our great-great-grandparents were not old enough to have known. Stranger reforms have happened. But no one is served by ignoring the fact that jury trials have not merely been in decline since 1997, but since the mid-1800s.

Subscribe now

Podcast of the Week

Professor Dieter Helm discusses how several key industries have fallen back to production levels last seen in the 1950s. Helm argues that the UK needs to focus on three big areas: competitive business taxes; affordable and globally competitive energy prices; and major investment in skills if we want to get back on track.

Subscribe now

Quick Links

A new campaign has been launched to scrap carbon taxes on electricity.

The government is accused of spending millions on ‘massaging’ NHS waiting list figures.

The government has pulled the Chagos Island treaty legislation for the second time.

The Prime Minister proposes joining the pan-European defence fund for a second time.

A former Labour MP is arrested on suspicion of rape, sexual assault and upskirting.

Reform u-turns on two-child benefit cap to spend more money on saving pubs.

The Prime Minister is reported to have called for the ECHR to be used to prosecute British troops when he was a lawyer.

The Health Secretary plans to offer resident doctors an even bigger pay rise to stop strike action.

The number of police officers has fallen by 1,300 under the new government.

The government has redesigned the ‘Lesser Arms’ crest for official communications.

Towering Columns

In The Times, Juliet Samuel criticises the backward-looking agenda of Tory “centrists”.

For one thing, by far the largest chunk of Tory votes — a quarter of their 2019 support — were lost to Reform at the last election, according to analysis by the Tory think tank Onward. But as long as Davidson and co stick to pro-business, anti-welfare waffling, and repress their urge to call anyone who would like a radical cut to immigration stupid or racist, they can be safely left to their own devices. They are not leading the party anywhere, and will reliably follow so long as the polling moves gradually in the right direction, which it tentatively appears to be.

It is left to the leader, then, to lead. Happily, on many issues, the direction in which the electorate would like to go and the changes required are increasingly aligned. Most people would support reshaping the state so instead of pouring money into welfare, fraud and truancy, it gives businesses room to grow and hire and spends on improving our innovative power, defence and industrial capacity. Most people would rather we imported small numbers of highly specialised migrants in fields such as nuclear physics and civil engineering rather than large numbers of poorly paid care workers from developing countries. Most people would rather see the state provide efficient services by promoting civil servants on merit rather than kowtowing to public sector unions by maintaining a vast payroll of pointless rule-makers, box-tickers and naysayers.

As for culture, Britain is in a revivalist mood. Our institutions need to be purged of the small-town tribalist corruption that enables grooming gangs and soft-touch policing of extremism. The utility of mass migration has been tested to destruction and it is time to admit that entry and settlement ought to be subject to a test of cultural compatibility as well as economic value. And the government needs to take a more forceful approach to breaking up ethnic and sectarian enclaves, promoting a unified patriotic identity over the violent squabbles of diversity politics. None of this involves a veer to the left but nor is it a return to the comfort blanket of Thatcherism and the worship of global “openness”. It is neither boring nor frightening. It is something new but also something conservative. And perhaps, with some luck, it is where Badenoch will take her party, and the country.

For The Spectator, Gavin Rice says the Tory-Reform civil war masks a remarkably coherent emerging intellectual consensus on the right.

But where the most exciting departures are taking place in centre-right thinking is in political economy. For both Tories and Reform, aspects of the old Thatcherite commitment to lower taxes and deregulation remain attractive, and some of these insights are right. Our tax structure has indeed become too redistributive, and far too many are now paying the higher rate. We have failed to embrace the challenge of proper regulatory reform after Brexit. But this rather thin soup of personal responsibility and state retreat while the forces of ultra-globalisation tear out the heart of the real economy is no longer enough.

It was heartening to hear [Robert] Jenrick talk of reindustrialisation in his interview with The Spectator this week. This is an agenda Nick Timothy, Neil O’Brien and I have been pushing for a long time. The argument has strong parallels with the drive to restore manufacturing and productive jobs in the US. Where it’s older but vital hard manufacturing like chemicals – which has collapsed by one-third in as many years – we must implement supply-side help, most obviously securing cheaper energy. But advanced manufacturing, AI infrastructure and our now-evaporated steel industry are examples of sectors that may not take off or survive without a more active state strategy. The global free market does not owe us a competitive tech or pharmaceuticals sector, and Britain’s high cost base has resulted now in two decades of rapid offshoring.

A restored commitment to economic solidarity and justice through opportunity is now orthodoxy from Badenoch and Jenrick to the libertarian online right and elements of the ‘Yimby’ left. Telling millennials and Gen Z they must work harder when the economic returns are a mere fraction of what they were in the 1980s is not good enough. The system must reconnect work, effort and material reward. This is a necessary but not sufficient condition for another ‘national conservative’ goal: the creation of strong, resilient and happy families, where parents can have the number of children they want, not the number that penury and a broken housing market say they can.

For The Critic, pollster James Johnson says the maths simply does not add up for a Tory recovery unless the party can win back millions of defectors to Reform.

Of course they would also have to find ways to differentiate: leadership, experience, better plans, the economy, and presenting themselves as the most competent option. But to earn the credit of that differentiation, voters need to feel there has been wholesale change in the way the Party runs. That needs ultimate contrition and disowning of key parts of the Tory record in government. Evidencing that means policy change, but also decisions on personnel to show the party is serious — whether that is ejecting former leader Liz Truss, or sacking current Shadow Foreign Secretary Priti Patel (an architect of the high immigration levels that put the Tories in the quandary they are now in). If this sounds familiar, it is because these are similar points made by Rob Jenrick when he was in the Conservative Party and since.

What is certain is that the status quo is not an option. The Conservatives cannot simply present themselves as an option in the middle of Reform or Labour — even if such a position is intellectually coherent, they will be squeezed out of the conversation. Some say that the Tories should focus on the economy, and that by the next election this could be the defining issue at the expense of migration. But that misunderstands how voters vote, especially those who have defected to Reform: they do not look down a list of parties and decide which is best on the given issue of the day, they vote based on which party feels like it shares their values the most.

The numbers show the only path to power for the Conservatives is through those who have left the party to Reform. It is a path that goes through a group that has defined British politics for the last decade: working and lower middle class, white, Leave-voting people in late middle age and older. If you are a Tory or Tory MP reading this: they are the only way you keep your seat or get more seats at the next election. If you are a liberal or centrist Tory or Tory MP reading this: there are not many people in the country who think like you, and there are very few people in the country who think like you and would consider voting Conservative.

And on ConservativeHome, Karl Williams teases out some of the tensions and commonalities in New Right political thought.

One of the greatest fissures in the New Right is on political economy, on free markets versus industrial strategy, between what Daniel Hannan has termed the FreeCons and NatCons. Leftists like Zack Polanski seem to see the British economy as a neoliberal hellscape of unfettered free markets, rampant exploitation and vertiginous inequality. But New Right free marketeers point out that the highest tax burden since the war and intensive government intervention through a sprawling regulatory state, industrial subsidies and price controls – the product of 14 years of Conservative government – is hardly ultra-Thatcherism on steroids.

New Right industrial strategists accept much of the free marketeer argument, notably on housing and net zero. But they also argue that the state has not been active enough in shaping the British economy according to national security considerations, for example on industrial capacity and the balance of trade; and especially in the face of Chinese, European and now American mercantilism.

Another important cleavage is around natalism and family policy. Few on the New Right would go as far as Hungarian-style birthmaxxing, but there are large differences on how to respond to the fertility decline and the fiscal challenges of an ageing population, differences that partially map onto the free market versus industrial strategy divide, but which are also partly refracted through religious commitments…These divisions on the right could be seen negatively, as a morbid symptom of the decadence and decay of an old order. That is certainly the tendency in left-wing reportage of the New Right in general. But this process could also be seen in a more positive (and almost Nietzschean) light, as creating the soil in which new and hybrid ideas can take root and grow.

For UnHerd, David Smith says Labour has no compelling story to tell the electorate, and has not grasped the brokenness of Britain’s economic model.

Our opponents are telling a clear story: Britain is broken; you have been shafted by a corrupt elite, the “uniparty”, or the 1%; the worst possible outcome is more of the same. We are not fighting Reform or the Greens so much as we are fighting this story. And if we lose, it will not be because of who the people at the top are, but because the stories we offer don’t have the same power. That is why the most urgent questions are not personal but political: in a rapidly changing world, how does this government define and deliver a decent life for ordinary people?

Beyond “we need to do better”, I am struck by the dearth of thinking in politics. Successful movements have always found ways to counterbalance personality politics via the rich seam of ideas, most obviously with Thatcherism’s dependence on the work of Friedrich Hayek and Milton Friedman. There is no shortage of policy proposals circulating at any given moment, but what are they anchored to? There is a near-total absence of ideology, or even of deeper thinking, both about how to define the problems we face and how to judge which answers are the right ones.

Over decades, Britain’s economic model has concentrated wealth and decision-making in Westminster while weakening the institutions, such as local government and trade unions, that once gave people real agency over their lives. Growth on its own will not resolve this if it is delivered through the same extractive dynamics that produced stagnation and insecurity in the first place. A different approach would prioritise productive capacity over rent-seeking, reciprocity over atomisation, and contribution over consumption. It would rebuild domestic supply chains, devolve economic power, and re-embed markets within social obligation. One could call it a new socio-economic covenant.

In The New Statesman, Paul Ovenden says Britain needs to embrace a Gaullist spirit of genuine sovereignty.

That light of national renewal is going to be harsh. It will require an honesty about what needs to change that is simply not in sight at the moment. Watching politicians dig their ideological trenches ever deeper – tax the rich vs shut the borders – one is left with a sense that we are surrendering to our troubles rather than taking arms against them.

Where people (wrongly) used to talk about polarisation, they now talk (rightly) of fragmentation: an electorate breaking into clusters. The temptation is for politics and political strategy to follow this, becoming ever smaller and shriller. Back to our values, shore up the base, hold what we have. In effect, this is to write off tens of millions of voters across the country. It is no recipe for creating a national story for a new era: it is an active choice to postpone any chance of renewal and instead take comfort in the schisms.

A modern Gaullist response to this moment would be to take on the frailty of our position and the smallness of our politics by acting bigger. It would be to give people a clear sense of what the sacrifices and the collective effort are all in aid of. In the spirit of comradeliness, let us take a generous interpretation of what Andy Burnham meant when he bemoaned in this magazine that we are “in hock to the bond markets”. It is both a cold, hard reality and a source of shame that we ended up here. But the challenge for Britain is more profound than mere market dependency. Whether it is our reliance on an unreliable ally for our defence, the fragility of our health system, our bloated but weakened state or our exposure to global energy prices, the story is the same: the life of the average Briton is not in hock just to the remorseless logic of the markets, but to outside events and actors everywhere.

Subscribe now

Wonky Thinking

On his Substack, Sam Dumitriu defends the Fingleton nuclear review from critique by the Wildlife Trusts.

Nuclear is described as a ‘potentially risky technology’. Clearly, they are trying to tap into radiophobia and fears about Chernobyl style-disasters. Chernobyl, by the way, was the result of a reactor design that lacked a containment dome – Hinkley Point C’s containment is built to withstand a 1 in 10,000 year earthquake and direct hit from a jumbo jet - and the decision to run it in extremely unsafe ways. (For more detail, I recommend this paper from Prof Gerry Thomas, who ran the Chernobyl Tissue Bank at Imperial College London until recently.)

No form of energy generation is without risk, but nuclear stands out as the lowest-risk. Our World In Data reviewed multiple studies and found that nuclear power is one of the safest ways there is to generate power. Only solar is safer, but that doesn’t account for casualties as a result of mining the rare earths used in renewables.

EDF is described as a ‘company owned overseas’. As if that invalidates their arguments or makes them commenting on public policy in Britain (a country where they employ over 12,000 people) suspect…

…Let’s remember what’s at stake. Nuclear power is the greenest form of power there is. Not only does it generate zero carbon emissions in operation, it is also the most land-dense form of electricity generation. To produce the same amount of power as Hinkley Point C would require a solar farm the size of the Isle of Wight. And that’s before you get into the need for backup generation and new transmission upgrades.

If we are to tackle the biggest driver of nature loss (climate change) then nuclear must play a role. But nuclear’s role is limited by its cost. Yet the high costs paid in Britain are not inevitable. France, Finland, and South Korea all build plants for much less. Britain could bring costs down, but not when rules and regulations undermine long-term investments in supply chains and push up costs. Rules and regulations that even the NGOs concede have not prevented a ‘nature crisis’. That’s why the Fingleton Review is so important (and why it has seen such strong support). It explains clearly what’s needed to bring those costs down.

If the Government delivers the plan in full, then it will be transformative. But, they must hold their nerve in the face of organised opposition and misinformation from green groups.

On his Substack, Andrew O’Brien says the language of “reindustrialisation” must be backed up by serious plans and serious funding.

Reindustrialisation risks becoming just another ‘vibe’ in politics, like planning reform. So what would a genuine shift to reindustrialise the country look like? As someone who emphatically agrees that we need to reindustrialise, here is a five-point test for whether any politician or political party is serious about it.

1. How much are you prepared to spend?

Dismiss out of hand anyone that says that his can be done by just letting the private sector get on with it. In a world where China is flooding markets with cheap products, where Europe and the United States are pumping tens of billions of pounds worth of subsidies every year, where Britain is starting from an incredibly weak position, this is not a cost-free policy.

I do not think anyone has a credible figure on how much it will cost to rebuild Britain’s industrial base, but we are likely talking about hundreds of billions of pounds over several decades. Of course, some of this can come from the private sector, but whether it is rebuilding our energy system, spreading the use of robots through industrial grants (as Rian Whitton has advocated), infrastructure development (e.g. freight rail and road), underwriting loans and investment (as South Korea did effectively post-war), rebuilding industrial skills and training (we could be short of 1.5m engineers by 2030) facilities, there are a lot of things that need cash. This is before we consider the basic raising capital for firms and R&D expenditure.

Any reindustrialisation programme that is not backed by at least £20-30bn of British capital (see below) a year, every year, for several decades is not credible. This cost element is important because a major factor for why we deindustrialised is that governments were not prepared to spend what was needed to help industry, they wanted to cut taxes or increase welfare expenditure or the NHS. It is not easy to resist those pressures, but ultimately, we will have lower welfare and more sustainable tax revenues if we reindustrialise. It’s a long term bet.

Now in the grand scheme of things, that isn’t a huge amount of money, we are spending over £1.3 trillion in the UK every year in the public sector alone, but it will mean privileging reindustrialisation over ‘retail politics’ that is easy for newspapers to report but does nothing to advance our fundamentals.

If someone is talking about reindustrialisation and not talking about the huge cost, then you know they are not going to do anything in office about it (see this Labour Government).

2. Where are you getting the money from?

This might seem like the same point as above, but it isn’t.

Money can always be found from overseas. However, we have learnt from bitter experience that depending on overseas capital for industrial investment is a hiding to nothing. For every Sunderland Nissan ‘miracle’, there are dozens of British manufacturing firms bought up, hollowed up, split up and shut down. British firms are not perfect, but they do give us more strategic control.

If we aren’t planning to reindustrialise using primarily British private and public capital, we are not going to get very far. In a globally uncertain world, we need to ensure that we are in control over investment, not hoping that boards in Delaware, Frankfurt or Tokyo do us a favour.

Foreign investment will, to a large extent, take care of itself. If international firms wish to invest in Britain, we should welcome it with open arms and support it (provided that it is genuine investment and not geopolitically risky). However, we should not depend on overseas capital to deliver reindustrialisation. If we think something is important, we need to put our own money behind it. If we believe an industry is key to our future (e.g. steel, automotives, pharma, defence etc.) then we need to mobilise domestic capital and ensure that domestically owned firms are in the driving seat.

How do we do this in practice? A combination of putting the National Wealth Fund / UK Investment Bank at the service of reindustrialisation, using pension funds and other domestic savings institutions to invest in British energy production and changing corporate governance to ensure that Britain has a seat around the table when decisions are made about the future of strategically important companies would be a start.

If the plan, as per our current and previous industrial strategies, is just to say Britain is ‘open for business’, then you know it is not credible.

3. What are you doing beyond energy?

We need to reduce the cost of industrial energy. This is clear and obvious.

However, as the chart below shows, lower prices does not equal boost in production. In the case of iron and steel, we know the problem was a lack of investment alongside allowing overseas products (e.g. China) to flood the domestic market. You could develop the same chart, I am sure, for other heavy industries.

So anyone that says their reindustrialisation strategy is simply to ‘scrap Net Zero’ or ‘energy abundance’ and hope for the best is not being serious. Cheap energy is a necessary, but not sufficient condition for reindustrialisation. Let’s not become a new MATE.

We need a huge range of other interventions, including…

4. What do you think about protection?

Donald Trump has politicised tariffs and now people seem to be taking position on tariffs based based on vibes, rather than substance. However, it is very hard to see how Britain is going to be in a position to reindustrialise in many areas (e.g. automotives, steel, chemicals) without some form of protection.

It is a cliché, but almost every country around the world that has successfully industrialised has used a combination of tariffs and other forms of protection (e.g. favourable terms of capital, regulation, tax concessions etc.). Britain did it. The United States did it (and is doing it again). Germany did it. South Korea does it. China does it. The list goes on.

Britain is in a weak position and any form of protection is going to hit consumers in a way that is unlikely to be popular when considered on a measure-by-measure basis (although I believe that politicians can make the case and win, just as Thatcher / Blair did for deindustrialisation). However, there is no long term gain without some short-term pain.

Are you prepared to use tariffs to protect domestic production and ask consumers to take the hit? Are you prepared to sail close to the wind of international trade agreements? Are you prepared to get British institutions to work very closely with firms to pin point opportunities to set global regulations in favour of British production (and privilege economic wins over other forms of diplomacy)? Are you prepared to bailout companies that invest big but fail so that they can try again?

If you do not hear that from someone advocating reindustrialisation some conversation about broader protectionist measures, then they are not serious.

5. What do you think about planning?

Don’t worry, I am not going to be writing about planning reform (although we do need to reform planning to make it easier for industry, as I have written about previously). I am talking about economic planning.

Economic planning does not necessarily mean state ownership. It does not necessarily mean collective bargaining or Industrial Development Certificates. However, at its core it means not simply reacting to events and consciously seeking to create a particular economic structure. A structure that markets (or the public) may at times resist.

Reindustrialisation is not the ‘natural’ bend of the UK economy. We are a highly service-based, highly-financialised economy; heavily weighted to city-based agglomeration. These are not things that lend themselves to growing industry as a proportion of GDP. So tweaks or rhetoric are not going to change much. We are going to need to take several steps to get to the result we want and we need to prepared to intervene constantly.

So you need to plan. There are formal (e.g. stated policy objectives like manufacturing as X% of GDP) and informal methods (e.g. bending state institutions to favour particular activities, as we have seen with financial services since the 1980s). But you need to boost state capacity (and private / independent capacity too) to understand, monitor and develop interventions that can support industry. Governments produce a lot of policy papers but in my experience are not good at planning and analysis. Look at the OBR, which has scored 1/10 in terms of forecasting ability compared to other agencies in The Sunday Times. We need to build up state capacity to understand what is going on and develop new models for how to transition our economy towards industrialisation.

Reindustrialisation is planning heavy compared to other sectors because there are so many moving parts. This is not like ‘tech start ups’ where someone in their garage can buy some computers, develop code and then start selling it. The physicality of industry, the long investment time-frames, the need for infrastructure, the interdependence of supply chains, the geopolitical challenges, all mean that planning is inevitable. It is not surprise to me that the death of planning effectively marked the rapid decline British industry (and the US to some extent).

Philosophically this is difficult for both left and right. The right cannot bring itself to accept that its ‘market knows best’ ideology was flawed. The left cannot accept that it was wrong to turn its back on planning to look ‘modern’. But they will need to accept that there is nothing ‘modern’ about letting things run their course and that markets do not always know best.

Anyone who is serious about reindustrialisation will need to embrace some form of economic planning and building the state apparatus to achieve it. If they are not prepared to countenance planning and building up state capacity, then they are not serious.

Subscribe now

Podcast of the Week

On The Winston Marshall Show, Reform MP Danny Kruger lays out the radical reform needed to the British state, arguing that all roads lead back to Blairism.

On Times Radio, Juliet Samuel goes head to head with Matthew Parris on the claims of Tory “centrists”.

Quick Links

The Prime Minister said Chinese premier Xi Jinping can visit the UK, despite China’s sanctions on British MPs.

Investment in Europe’s chemicals sector plummeted 80% in 2025.

Longstanding members of the Tory Left launched “Prosper UK”, claiming to appeal to centrist voters identified in as yet unpublished polling.

The OECD forecast that global fertility rates are falling faster than expected.

Payrolled employment has continued to decline.

The CPI inflation rate ticked up in December from 3.2% to 3.4%.

Supporters of assisted suicide were accused of “bullying” as they threatened to use the Parliament Act to force the Bill through the House of Lords.

The Conservative Party now has the youngest average membership, though total numbers remain at a historic low.

US commentator Tucker Carlson said he felt safe as a Christian in Saudi Arabia - a country where Christianity is banned.

Towering Columns

In The Telegraph, Tim Stanley says that Britain must become independent from the United States.

So it goes with contemporary Europe, where American corporations dominate and profit, yet also avoid paying a lot of tax. Ireland, for example, has rightly denounced Trump’s tariff war on the nations that oppose his aggressive takeover of Greenland – yet the country is a model of globalist acquiescence at the cost of sovereignty. It has embraced free markets (low corporate taxes) and free movement (mass migration), with the result that Dublin is outwardly Irish – still beautiful – yet unaffordable and embroiled in a violent identity crisis.

These are economic policies that its elites justify as essential to modern nation building (“we need money, we need workers”), and it’s striking that the SNP has proposed doing similar things should Scotland gain independence. As Grant observed in 1965, the modern nation state can only develop by opening its arms to global capitalism, but global capitalism “entails the disappearance of those indigenous differences that give substance to nationalism.”

In short, American capital has made all of us rich, but it has also made us duplicates of the US. I’m convinced that many Britons are desperately unhappy, even mentally ill, because they don’t feel like themselves anymore. It’s obvious in the way we now talk (badly) and emote (too often) but most apparent in our politics, which is imported and detached from our real history. Identity politics was Made in America: when federal agents shot and killed a protestor in Minnesota (murder in my book), Labour mayors felt obliged to write a letter of support for the Democrat mayor of Minneapolis. Why?

For The Critic, Robert Clark lays out Britain’s threadbare defences and inability to project power overseas.

Whilst most can readily agree that indeed Putin should be deterred from further acts of aggression in Europe, the legitimate concerns of the nature of our armed forces should now be fully laid bare – especially when the stakes are this high. Only this week the Chief of the Defence Staff, Air Marshall Richard Knighton, revealed in an extraordinary and heated evidence session with MPs of the Defence Select Committee, that Labour’s flagship defence strategy could not be fully funded — compounding dizzying estimates that the Ministry of Defence requires and additional £800 billion by 2040 just to meet current obligations.

Whilst these figures reveal the degree of financial mismanagement, a multi-year recruitment and retention crisis means the Army has missed their manpower targets consistently for a decade. There are problems with steel as well as flesh; with so few tanks now being upgraded to the next generation Challenger Three, there will only two regiment’s worth of tanks left for an Army that is supposedly able to field an armoured division.

That armoured division was Britian’s core promise to Europe for almost a century. In the last decade, due to this country’s obsession with ploughing money into the welfare state over the nation’s defence, that has been utterly trashed. We are now in a situation where we cannot even deploy 5,000 troops — never mind the government’s mooted Ukrainian deployment number of somewhere closer to 7,500.

In The Times, William Hague says the Greenland crisis must be used as a moment to rebuild our strategic power.

The best outcome of the Greenland crisis would be that it shakes western Europe from its torpor. The PM’s speech referred to the importance of “shaping the world around us”. But on current trends the world — particularly the US and China — is going to shape us more than ever before, with the continent of Europe humiliated and exposed as weak. Seeing this coming, some states are stirring into action: Germany’s defence budget is soaring; Poland and the Nordic countries are raising the resilience of their armed forces and civilian populations.

The prime minister should realise that to keep shaping the world around us we will have to wake up and shape up ourselves. Whether we will be protecting an international system based on law or defending ourselves in a lawless world, we will need to recreate essential instruments of our own power. That takes many forms, including a growing economy, a healthy population, strong education and pioneering technology, but it starts with defence. Britain needs armed forces that our enemies fear and our allies, including any US president, regard as invaluable.

The Greenland issue is becoming a grave danger to the cohesion and unity of the West. We have every right to look to Americans with a conscience to speak out. But we should also be looking at ourselves, at our own diminishing ability to influence events, and decide that we cannot sleepwalk into a more dangerous world.

For CityAM, Richard Ekins shows that the Chagos Islands deal is even less credible in the wake of US opposition.

The government’s case for surrendering the Chagos Islands is thus that unless we do so, ideally having agreed favourable terms with Mauritius, then Mauritius will leverage the 2019 Opinion into rulings from ITLOS and maybe some other unnamed bodies, which will make it impossible for us to operate out of Diego Garcia. As my Policy Exchange colleagues and I have shown, this is not a good argument for surrendering sovereignty. It also suggests that Mauritius is far from a friendly state. Handing over the Islands on this basis amounts to a surrender to the prospect of further abuses of international adjudication, in which the UK’s rights as a sovereign state are ignored. Lord Hermer KC, the Attorney General, seems to see surrender of the Chagos as an opportunity to display fealty to the (international) rule of law. In fact, it is a landmark for UK failure to stand on its rights, to resist a loss of integrity in international adjudication, and robustly to defend its strategic interests.

For the Chagos Islands are utterly vital for our defence interests, not least to our relationship with the United States, which the government is rightly trying to preserve in the current turbulence. The deal that the UK has agreed with Mauritius is limited in time and creates further vulnerabilities in terms of our strategic position, exposing future operations to new legal risks and to the prospect of third parties, such as China, subverting a future Mauritian government.

None of this can be justified in terms of justice for the Chagossians, most of whom are now British citizens and do not seem to support this deal. The UK-Mauritius Agreement pays lip service to their historic connection to the Islands but in fact leaves Mauritius entirely free to do as it wishes in relation to the Chagossians, with only a tiny fraction of the substantial payments to be made to Mauritius earmarked for them, with payment at the Mauritian discretion in any case. In addition, as Policy Exchange showed in a paper published only a fortnight ago, handing over the Chagos Islands will gravely compromise the protection of one of the planet’s most important marine environments.

In The Times, Dieter Helm writes about that we can save our industries from destruction if we redesign our energy policy.

How to get out of this mess? What is needed is an international competitive price of energy, and especially of electricity. How might this be achieved? The same way it was under the “bad old days” of the Central Electricity Generating Board (CEGB). Start with the price that would be competitive. How it was done in the UK (and in France) pre-privatisation was to charge industry the long-run marginal costs of energy, rather than the full fixed and sunk costs of the capacity.

Under the CEGB’s bulk supply tariff, there was an energy price and a capacity cost, to which was added, where appropriate, the transmission and distribution costs. Energy-intensive industry paid the first energy element, covering its variable costs, and it made some contribution to the capacity and network costs.

How could this be a sensible economic approach? Because everyone was better off with these industries rather than without them, as long as they made even a small contribution to the capacity and network costs. Think of the scenario where they are charged the full costs. Imagine that this is uncompetitive and the industries close down. Is everyone better or worse off? They are worse off, since these industries no longer contribute to the capacity and network costs — nor, indeed, to the wider economy. To head this off, set a competitive price by charging them the marginal costs and a little of the fixed and sunk costs.

At Conservative Home, David Willets says Conservatives must keep their focus on economic reform.

Britain has levels of investment, public and private, significantly below most of our competitors. Promoting effective public investment matters and that means speeding it up. Badger sets are still holding up major infrastructure projects when they aren’t even a protected species. This is absurd. And we should be going flat out to attract overseas investment, trying to get some advantage from Brexit. Grimly denouncing “black holes” in the finances or describing Britain as “broken” is no way to win over big international investment. We can boost wages with more effective, more productive work.

The good news is that the increase in employment over the past decade, notably amongst families on low incomes, has to some extent offset the effects of cuts in their benefits. There is still more we can do to get young people working. This is where increases in the minimum wage could do most damage. And it remains the case that people with a university degree are more likely to be working, more flexible and able to get back into work as business sectors shrink or grow, and more likely to be working into their fiftes and sixties. So perhaps tone down the attacks on universities just a bit.

The Resolution Foundation’s Economy 2030 Enquiry showed how important it is to revive our twin second cities. If Manchester and Birmingham performed like Frankfurt and Munich or Milan or Lyons our overall economic performance would be so much better. That means investing in radial transport links and also radical devolution. Andy Street helped shape that agenda and should be a key figure in shaping it again. It means more investment in the golden triangle of London, Oxford, and Cambridge.

On his Substack, Neil O’Brien outlines how the welfare budget is on an unsustainable trajectory over the rest of this Parliament.

Rachel Reeves’ Budget at the end of last year revised up forecasts for working age welfare spending significantly. In fact, over the 5 years from 2025/26 to 2029/30, the government is now planning to spend £36.4 billion more on benefits than they had planned to only a few months earlier.

The difference is shown in the chart below as the little grey gap. But it isn’t really that little. Spending in 2029/30 alone is now predicted to be nine and a half billion a year higher than it was in the spring forecast. That’s a lot of extra taxpayers’ money over just a couple of months. Overall, between Spring Statement on 26 March and Budget on 26 November, Reeves lost about £150m a day.

In future posts I will come back to the reasons why we are seeing more people on benefits, and growing claim amounts from people on benefits. The short answer is a combination of:

• A labour market reeling from higher taxes and more regulation,

• A series of benefits where people have learned how to play the system, (“system learning” in the jargon) and people have become more likely to seek a claim,

• The growth of mental health claims, particularly among younger people.

For The Critic, Alex Yates makes the case for the intellectual bankruptcy of a left that has failed to keep up with the modern world.

Just as the left has failed to provide a cogent analysis of the economic trends of the last decades, so too has it failed to understand the enormous impact of demographic changes wrought by mass migration. Opposition to immigration has been treated as a pathology to be deconstructed or explained away rather than a rational political position, with adherents to such views categorised either as unwitting victims of false consciousness, or irredeemable bigots cruelly lashing out due to their own failings. National identity is treated as an anachronism, something the left always assumed would naturally dissolve away as class identification superseded such confused and artificial divisions. When the left has approached British national identity, it has been either to deconstruct it as artificial and therefore implicitly invalid, or to scold it for its association with perceived historic wrongdoings and upholding the categorical evils of white supremacy, colonialism, racism, and so on.

Britain is indeed confused about its own national identity, having never properly interrogated what it meant to be British once the Empire had dissolved and its settler colonies gone on to develop national identities of their own. Since the turn of the century, multiculturalism was imposed from above as the guiding light of Britain’s post-Imperial identity. There was no rigid definition of Britishness, no need to be of a certain ancestry or even to have been born in the country. A piece of paper declaring one British would suffice, with adherence to a set of vague liberal values preferable but not mandatory. But demographic developments have rendered this vague definition unsustainable. Much to the left’s consternation, older conceptions of national identity tied to ancestry have been growing in popularity despite a concerted effort by all organs of the state to convince people otherwise. So what is the left’s response? What convincing alternative do they put forward? “Mr Blobby patriotism” and a conception of British identity centred on TV adverts and fart jokes.

Such a profound failure to confront the realities of modern-day Britain means that the left will continue in its failure to deliver in government and form a coherent understanding of why it keeps failing. Instead of taking this moment to look outwards to the country and offer a constructive vision, the British left can offer only a continued project of deconstruction of Britain’s institutions and passing obsessions with global social movements — climate, Black Lives Matter, Gaza — that elicit flashes of fanatic zealotry before being dropped and forgotten. Perhaps before continuing to misdiagnose why Britain is broken, the left would do well to look inward and analyse why it too has ended up intellectually broken.

Subscribe now

Wonky Thinking

New research from the Institute for Family Studies has found that families which pray regularly are likely to have larger numbers of children in Europe. The research has found that prayerlessness is now a majority-phenomenon among young females in the UK and Belgium. Germany and Spain are near the tipping point. Moreover, a 2% increase in GDP per capita raises fertility by just 0.0081—the same effect as a mere 1.12 percentage point increase in the share of women who pray. This suggests that faith is as important as the economic fundamentals in determining fertility rates. Christopher Sandmann explains his research.

Sympathetic observers with whom I’ve shared my results are quick to argue that higher fertility rates among the religious are plausible; however, they should be attributed to cultural norms linked to religiosity, not active religious practice. This is certainly possible. But how would we know? Polite society’s taboo not to talk about religion only ensures that the question remains unanswered.

Keynes famously argued that ideas change the course of history. I agree. Ideas are powerful. But only so if they are believed. A norm, lacking belief, has the qualities of a decapitated chicken: it might keep on running for show, but won’t overcome obstacles like the opportunity cost of parenthood. Indeed, one must be out of their mind to pursue parenthood just because tradition demands it. I am reminded of the title of a book on parenting: All Joy, No Fun. If you are not prepared for true joy, the lack of fun will bring great disappointment. Joy is reserved for those who are prepared to serve. Faithless countries with greater vote shares for conservative parties have certainly not experienced a baby boom as of late. As I see it, the association of faith and tradition has it all backwards. Deference to tradition is the exact opposite of faith in an active, living God. Rather: where the faithful do adhere to past wisdom, they do so out of discernment, not deference to past tradition.

The data supports this distinction. When I include church attendance in my regressions, it proves insignificant for fertility—whether or not prayer is also included. This could reflect data limitations, but it may indicate that interior transformation through active prayer, rather than social participation, drives the effect. My sense is that the insignificance is reflective of the dynamics of irreligiosity and demographic decline: Individuals stop worshipping with others before they stop praying. And loss of prayer precedes demographic decline. In today’s Europe, belief still exists outside of church pews. The body of the faithful, however, has disintegrated into many disjoint parts.

Why?

Many Europeans (perhaps unknowingly) have grown up to become existentialists: we create our identities on a blank sheet of paper. In ‘existentialism is a humanism’ Sartre writes: “man first of all exists, encounters himself, surges up in the world — and defines himself afterwards.” I sense that no generation that has felt this more strongly than mine, which came of age after the Cold War. When first conceived, such philosophy feels like freedom: It promises liberation from parental missteps, history’s errors and severs supposed obligations before citizenry and God. It is also redemptive: If we define ourselves, we need no longer call our selfishness as such. Our Augustinian brokenness is a construct, no longer caused by sin but imposed on us by an oppressive ideology. This is redemption without sacrifice. We are free.

Seen through the lens of existentialism, prayer is as effective as meditation or a self-help group. It becomes an act of self-expression, self-creation. Part of the personal project of curating among the pleasures in life. The greatest prize that this philosophy offers is the aesthetic: sublime music, the sensual as in romantic passionate love, grandiose architecture as in temples of art, enriching culinary experiences, and mere observation of nature. The aesthetic is not a small prize. God’s creation and the wealth of human experience that may live within it truly are wonderful.

The Prosperity Institute calls for the complete separation of climate and energy policy. The climate change agenda, the report argues, has warped energy policy and led to a series of failed policy agendas that have burdened Britain with higher bills and diminished capacity.

Over the last four and a half decades, when they were each given the chance to take the lead, the markets worked and the British state failed. Why? Because energy policy was used as a tool of industrial policy in the vain hope of creating a world leading offshore wind industry; Whitehall committed the error of adopting multiple conflicting policy objectives (e.g. decarbonizing the grid and keeping energy bills down); and policy was captured by vested interests.

The foundational error of Phase Two was subordinating energy policy to climate policy. If you have a climate policy, it should be economy-wide, not sector-specific, as this leads to continuous state interventions and becomes a licence for rampant rent-seeking. The essential first step to energy policy rationality is to separate energy policy and climate policy.

Policymakers should then define what they want their policy to achieve and the policy instruments to achieve it. Policymakers also need to face up to the risks posed by Britain not having enough dispatchable capacity, thanks to the political decision to push coal off the grid. If they want energy prices to fall, supply needs to increase, which means having more non-intermittent generating capacity. This is likely to require a rapid build-out of gas-fired capacity, or even coal.

Whichever party or parties form the next government, they have only one chance to get energy policy right by applying the lessons of the past and decisively breaking with two decades of policy failure. The fundamental step is to divorce energy policy from climate policy. Parliament has, since 2007, enacted legislation to lock-in Net Zero energy policies, such as the Climate Change Act 2008. Such legislation needs to be repealed or amended. Additionally, this paper recommends:

• Shutting down the current Department of Energy Security and Net Zero (which has overseen the worst policy disaster since 1945 and has been captured by vested interests), and replacing it with a new department focused exclusively on policy.

• A wholesale clear-out of Ofgem’s senior leadership.

• Establishing a New Generation Task Force to replace around 20 GW of missing nonintermittent capacity, consideration being given to use of the Government’s balance sheet on value-for-money grounds via Ed Miliband’s Great British Energy.

Subscribe now

Podcasts of the Week

John Bew on the UnHerd this week says that the Davos World Order is finished and that the country needs to see Greenland as an emergency “break the glass” moment on defence and security spending.

Subscribe now

Quick Links

The United States temporarily lifts threat of tariffs on UK and Europe over Greenland.

New research has found that Government u-turns have already cost taxpayers £8.2bn.

The government has cancelled 29 local government elections for 4.5m electors.

The government u-turns on a ban for under-16s using social media.

The security services say that the risk of the Chinese mega-embassy cannot be completely eliminated.

Pubs are the only businesses to be spared from business rate hike.

Government report says that judge-only trials will not wipe out backlog.

The UK refuses to join the Trump-backed ‘Board of Peace’.

Former Shadow Justice Secretary Robert Jenrick said ‘reindustrialisation’ should be an economic priority.

Towering Columns

In The Times, Juliet Samuel says approving China’s new London super-embassy is a far too big a risk.

What seems likely is that the new embassy will allow the Chinese Communist Party to scale up its espionage and interference operations across Europe. As The Sunday Times revealed, China’s list of authorised diplomats, already among the longest in the UK, has grown 50 per cent since 2010, including a whole roster of education, policy and cultural officials no doubt helping to surveil and schmooze scientists, students, business contacts, activists and spies. And MI5 and others have explained repeatedly how Chinese intelligence banks upon its superior scale to extract the maximum commercial, military and diplomatic advantage from these operations.

Another favourite CCP hobby is showing it can harass and punish its critics wherever they are in the world. Again, this occurs at scale. Safeguard Defenders, a campaign group, found that Beijing has forced at least 12,000 people to return to China to face “justice” from 2014 to 2023, under the aegis of so-called “anti-corruption” operations. Consular officials in the relevant countries have been known to prepare the ground for these “persuasion” operations.

Perhaps they also help to manage the properties and recruitment of staff for Beijing’s foreign “police stations” or further its useful links to organised crime. In its annual assessment last year, after all, the National Crime Agency stated that “offenders linked to China currently pose the biggest non-British serious and organised crime threat to the UK”. Does that sound like a country you want building an iceberg basement within spitting distance of your critical internet cables?

For The Critic, Sebastian Milbank says the biggest divide in British politics is that of worldview and experience between generations.

If you grew up in the 60s-80s, and your career reached its peak sometime in the 90s to 00s, you experienced events and conditions that taught you that certain assumptions were true and historically inevitable. You witnessed the victory of civil rights battles on race, gender and sexuality, and formed your opinions about them at a time when they were vigorously contested by a powerful political right. You saw communism fall in your lifetime, and liberalism triumph. Throughout most of your working life you saw high levels of economic growth, technological progress and new industries and opportunities arise. Cultural and social change that was opposed by conservatives led, in your experience, to new artforms and exciting subcultures.

And, as an individual, for so many boomers and gen Xers, especially in the educated upper middle classes, you ascended a ladder that was about to be kicked violently away. People in older generations attended schools before the quality of teaching and discipline plummeted, and went to university whilst it was still free. They benefited from public services of the post-war era, then cashed in on the deregulations of the 80s and 90s. They got on the property ladder when it was still affordable, and just in time to see their housing equity explode in value.

And, crucially, you didn’t see the dark side of progressivism. When you were young, you experienced the civil rights fight as a positive experience, and at the time you were ascending the ladder, the ideal of a non-divisive, “comfortable” egalitarianism in which we would be sexually free, post-racial, post-class, and post-gender divides predominated. By the point that #MeToo and BLM arrived in anglophone offices, you had already reached the peak of your career. For liberal older white men, the idea that young white men are systematically disadvantaged for employment in much of the white collar world, especially some of the most elite institutions, simply existed outside of their experience. Younger colleagues were becoming “more diverse” and more politically militant, but this was just merit shining through from your cushioned perspective.

In The Spectator, David Shipley says London feels lawless as the types of crime most ordinary people are likely to experience are on the rise but under-reported.

The problem for Rowley is that the homicide rate is a poor indicator of how safe Londoners feel. While it is true that London’s homicide rate did fall last year, and that there are more murders in other cities around the world, thankfully almost no one is killed in the capital in the 21st century. There were 97 homicides last year, compared to 109 in 2024 and 153 in 2019. Of course, every such killing is a tragedy, but really they don’t happen anywhere near often enough for the typical Londoner or visitor to spend time worrying about whether they’ll be murdered in the city. What people worry far more about is crimes which they are likely to be victims of. There were 837,826 ‘victim based’ crimes recorded by the Metropolitan police in 2025. These crimes include robberies, phone snatching, sexual assaults and rapes. Such victim-based crimes have soared in London in recent years.

A decade ago, in 2015-16, there were 16,147 recorded sexual offences. Last year saw the Met receive reports of 27,694 such offences, and year-on-year reported rapes are up somewhere between 8 per cent and 12 per cent. Phone theft too is at endemic levels, with 117,211 stolen handsets reported to the Met last year. This morning Rowley was insistent that phone theft at least is falling, and I understand the official internal data supports this. The Met Commissioner also tried to encourage listeners to ignore reported crime in favour of ‘crime surveys’ which try to estimate the overall level of crime. Many politicians and senior police officers prefer these figures, perhaps because they have generally shown that crime is falling. The Crime Survey of England and Wales (CSEW) has a number of weaknesses, not least that it tends to ‘oversample’ from low crime areas and ‘undersample’ from high crime areas. Even then, it has shown some crimes becoming dramatically more prevalent, with ‘selected knife offences’ up from 26,370 ten years ago to 53,047 in 2024-25.

The Met doesn’t police all of London. British Transport Police are responsible for mainline trains terminating in the capital, and for the underground network. Their last annual report described ‘an overall challenging environment of increasing crimes ranging from higher reports of anti-social behaviour to our highest ever number of homicides’. That report also states that sexual offences increased by 10 per cent compared to the previous year. Meanwhile the City of London Police, responsible for the Square Mile, reported an increase in thefts, violence, public disorder, criminal damage, sexual offences and robberies.

In The New Statesman, former Downing Street adviser John Bew says the world is now re-entering a “hemisphereist” approach towards foreign intervention.

[A] new paradigm is emerging for how the military power is deployed, in an age when defence technology companies like Palantir and Anduril are the darlings of the Department of War. It is one that places a premium on information and technological superiority – often associated with the use of special forces and set up in contradistinction to the idea of long campaigns and “forever wars” in godforsaken parts of the world. It is not an unpopular argument with the American population given the long tail of those wars in Iraq and Afghanistan and the costs paid in blood and treasure. So far the distinction is enough to keep the splits within the Maga movement under control, given the considerable distaste for any type of foreign interventionism that exists in the base.

Unconventional as it is, the commander in chief and the maker of deals inhabit the same strategic brain. Thus, the use of the military instrument is repeatedly used to buttress an unsentimental and hyperactive realpolitik. Witness the situation in post-Maduro Venezuela. Here the early signs are that Trump would rather cut a deal with the chastened remnants of the old regime than usher in some colour revolution in which the democratically-elected opposition takes the reins and the credit. To be clear, he is not solving for a queasy Western liberal audience who would be better able to stomach the political decapitation of Maduro if there followed the anointment of the highly palatable Maria Corina Machado, the latest recipient of the Nobel Peace Prize. As we have seen in the administration’s Middle East policy, being a person with whom one is able to do business, not trade in virtue, is the order of the day.

The second and most interesting aspect of what happened in Venezuela, is what it reveals about a new form of brutal mercantilist logic that underpins the administration’s broader approach. A major reason why the trajectory of Venezuela was deemed so unacceptable was that it saw one of the most oil-rich nations in the world – in addition to having vast reserves of gold, gas and iron ore – flaunting its assets to Chinese and Russian bidders in ways that cut across American commercial interests. This was understood in Washington and Florida as a direct affront to American dominance of international finance and commodities markets in its own backyard. The icing on the cake, and the casus belli, was Maduro’s tolerance of drug running and destabilisation of more pro-US neighbours in Guyana and Colombia, who also host vast US investments.

For UnHerd, Paul Sagar says the number of students being diagnosed with ADHD is exploding due to “looping effects”.

To understand the complexity of the issue, it is helpful to consider the work of the philosopher of science Ian Hacking, who spent much of his life trying to untangle this sort of thing. One of the most important lessons that Hacking taught us is that when it comes to medical diagnoses with behavioural aspects, humans are “moving targets”. This is because of what he termed “looping effects”: that when people receive a label, they respond to it by changing their behaviour accordingly. But because their behaviour has now changed, the label itself must evolve to capture the very thing purportedly being labelled. This then sets off new kinds of behaviour in those receiving the label — and thus the looping continues.

Hacking’s work on autism helps to illustrate the point. When autism was first established as a diagnostic criteria in the Forties, it applied only to the severely mentally impaired — typically those who were non-verbal and highly socially dysfunctional (they were unable to live without extensive support provided by parents and professional carers; many were institutionalised). Over time, however, the criteria were relaxed, in particular the (controversial) introduction of Asperger’s syndrome in the Eighties, which applied to “high functioning” autistic people especially: those who were not only fully verbal, and often living independently, but crucially were diagnosed as adults (previously autism was something identified almost exclusively during childhood, precisely because it was so severe).

Yet this expansion of autistic criteria and the birth of the idea that autism is a spectrum, rather than a single category of psychological impairment, inevitably set off looping effects. An Asperger’s diagnosis, for example, changed not only the way certain kinds of adults (i.e. those receiving the diagnosis) viewed themselves, but how they behaved. Rather than being shamed and shunned for being “weird” (the fate of earlier generations), they could now (justifiably) protest that they were simply different, as validated by science, and deserving of relevant accommodations. Indeed, many advocated for precisely this distinction, refusing to suppress their non-typical behaviours simply to accommodate “normal” people. (This is one important origin of the modern distinction between the “neurotypical” and the “neurodivergent”.) Such a development has quite clearly benefited, in real and important ways, many people, allowing them to access better resources in a world of reduced stigma. Yet, as the criteria was relaxed, more and more adults started to see themselves as possessing features enveloped within the ever-growing “autistic spectrum”. Ever-growing, because the spectrum diagnostics kept changing to incorporate and accommodate the growing range of correlated symptoms. Which led to more people meeting the criteria, and so on.

On his Substack, Andrew O’Brien says Britain has addressed inflationary pressures by subsidising consumers rather than raising production.

Outside of war, the usual approach in Britain (or much of Europe) was targeted financial support for those that need it to help afford the essentials (e.g. tax credits). However, since the financial crisis, we have started to drift towards a consumer subsidy model which is closer to developing countries in Latin America, like Venezuela, or Asian countries such as India or Iran. These are attempts to manipulate prices and household incomes for political ends. Just like in developing countries, our consumer subsidies not particularly well targeted and risk becoming hard to shift in the future (as we have seen from the fuel duty freeze). Directly subsidising the cost of something makes any price rises ‘political’ in the future. Already, too much of our economic attention is being taken up by how to maintain what we already have in place (e.g. fuel duty).

The real solution to the cost of living crisis is, as I have argued before, two-fold. Firstly, it is boosting domestic production (if we want cheaper food, provide support that grows more of it here, if we want cheaper energy, produce more of it) through long term investment. Secondly, we need to rebalance our trade (e.g. reduce imports, increase exports) so that inflation is not made artificially higher through the weakness of our currency. The billions spent on the measures in this Parliament alone could have been used to invest in these measures that would have long term benefits.

Mass consumer subsidies are attractive because they are a lever that can be pulled immediately and are perceived to provide ‘credit’ to politicians. The latter is particular dubious and has a very low opinion of the public. The Conservatives efforts to offer pre-election tax cuts (and introduce the energy price cap) did not boost their popularity in the last election. Moreover, I’d argue that giving people something temporarily that will create losers when you take it away is a recipe for political disaster. I am sure that is what Treasury officials advise when these measures are considered.

Subscribe now

Wonky Thinking

Policy Exchange published A False Compromise by Sir John Jenkins and Andrew Gilligan. The report explains why a definition of “anti-Muslim hostility” is at least as bad as “Islamophobia” and should be resisted.

According to leaks, a government-appointed working group to devise an official definition of “Islamophobia” has proposed a draft which avoids the word “Islamophobia,” substituting instead the term “anti-Muslim hostility.”1 Members of the working group have sought to present this as a compromise which will “resolve” opponents’ concerns.

A definition of “anti-Muslim hostility” is, in fact, at least as broad and dangerous as one of “Islamophobia,” possibly more so. And because the term lacks (for now) the same negative political connotations, it is also more deployable by activist groups.

The dictionary definition of “hostility” includes “not liking” something, “not agreeing” with it or being “opposed” to it. It is perfectly accurate, for instance, to describe the National Secular Society as hostile to the growth of Muslim (and other religious) schools. No hatred is present here, merely opposition.

This note details multiple other examples where the term “hostility” has been used, including by members of the working group, to attack legitimate criticism or scrutiny of Muslims, Islam or religion.

We show that even as the police now propose to scrap “non-crime hate incidents,” an official definition of “anti-Muslim hostility” risks giving this enormously controversial practice a new lease of life – if only for “non-crimes” against Muslims.

We have also learned that the leak was incomplete. Not disclosed was that the proposed definition includes examples of speech which would not be deemed “hostile” to Muslims. These examples of permitted speech are narrow – for instance, they include theological criticism of Islam, but they do not include saying that disproportionate numbers of British Pakistanis are involved in group-based sexual offending (one key instance where speaking the truth has been attacked as “Islamophobic.”)

Also not disclosed, the definition states that public bodies and companies will be free to adopt their own definitions of “anti-Muslim hostility,” even broader than the one proposed – effectively carte blanche. We show how the term “hostility” has been used to further the second goal of many of those involved in campaigning for a definition – to bring about political change by the back door, including weakening counter-terrorism and immigration laws.

We raise concerns that one of those who devised this expansive definition has already been given a government-funded role which, in effect, makes her into an arbiter of what constitutes “anti-Muslim hostility.”

We argue that giving Muslims special protections not available to others will be disastrous for them, and for everyone else. It will fuel, not diminish, hostility towards Muslims. It will empower divisive extremes – both in Muslim communities, by creating new opportunities for challenge, grievance and attack in every institution and workplace; and on the nativist right. It will increase, not reduce, social tensions.

In The Spectator, Lord Nash lays out the conservative case for an under-16 social media ban.

Before discussing a ban, it is worth keeping in mind what our children are being exposed to on their social media feeds every day. One study found that 70 per cent of children had seen real-life violent content online, with only 6 per cent seeking it out.

Algorithms which are designed to reward attention constantly push videos of stabbings and beatings into young people’s feeds. What kind of effect is this content having on them?

When you speak to police officers, battling hard to keep the public safe, it is clear that there is a clear link between social media use and criminality for young people. Drugs are glamourised, leading to early experimentation. Gangs use social media to recruit children as young as seven and control their movements. Social media sites are the backbone of the county lines networks which force children to sell drugs.

They are also having a radicalising effect. That’s why the heads of MI5, Counter Terror Policing and the National Crime Agency took the unprecedented step of issuing a joint warning about online safety to parents last summer, and likely why young people are being arrested for terrorism offences among the highest on record. We picture radicalisation happening in backstreet corners of formerly industrial towns. We imagine shadowy but charismatic figures recruiting vulnerable young men in person. No longer – young people are being groomed in their bedrooms, on their phones and tablets, while their parents sit downstairs completely unaware.

And then there is the exploitation we do not talk enough about. Predators don’t just lurk in the shadows; they operate openly on platforms grooming vulnerable children in plain sight, with ‘com groups’ blackmailing teenagers into sharing explicit images or harming themselves.

On mental health, the statistics could not be clearer. There has been a 15-fold rise in eating disorders amongst 17 to 19-year-olds in recent years.

Beyond the human tragedy, this terrifies me economically. What hope do we have of turning this country round if we have an entire generation warped by social media? A generation too anxious to form relationships – too unwell to work or too distracted to achieve. Our public services are already buckling because they are fighting a mental health epidemic – all while social media inflames the crisis.

And yet I hear the understandable lament of The Spectator reader: this is just basic parenting – parents should just refuse to let their children use social media. But that effectively means making your child a social pariah when everyone else in their class is already online. There is a reason 86 per cent of parents want this ban. They’re not asking the state to replace them, they’re asking for intervention to break the network effects of social media.

Others worry that a social media ban for under-16s will be used by governments to stifle free speech. But this is nonsense. We don’t let a 12-year-old get behind the wheel of a car and drive up the M1, or let a ten-year-old buy a couple of pints at their local. The state, for very good reason, bars children from doing certain things while their brains develop and they acquire the knowledge and experience to navigate them wisely.

Conservatives believe in law and order, in strong families, and in a state that knows when to act and when to get out of the way. We trusted parents with academies, and we were right to do so. We should trust them now when they are crying out for a line in the sand. This is the moment to act, not out of moral panic, but to give children their childhood back.

Subscribe now

Podcasts of the Week

Nick Timothy and William Clouston appeared on the SDP podcast discussing Britain’s need for a new economic model.

Greg Jackson, founder and CEO of Octopus Energy, appeared at The Spectator’s energy summit explaining the flaws in Britain’s system of pricing and taxing energy.

Subscribe now

Quick Links

Nick Timothy, our founder, was made Shadow Justice Secretary.

The chief of the West Midlands Police has been “allowed to retire” instead of being sacked over the Maccabi Tel Aviv football ban.

The police used unregulated AI when taking their decision to ban Israeli away fans - but denied this several times, it was revealed…

…and the Home Secretary was informed about the likely ban eight days in advance.

Pro-Palestine activists plotted to “spy” on Israeli football players, it was revealed.

The West Midlands police and crime commissioner (PCC) has been accused of offering to give the controversial Green Lane Mosque a “blank cheque” for public grants.

The UK was ranked third globally for FDI projects between 2022 and 2025.

The Government rejected calls from the automotive industry for Chinese-manufactured EVs to be eligible for taxpayer subsidies.

Data from the US showed radical expansion of housebuilding caused rents to plummet.

The birthrate plunged to just 1.4 children per woman.

Towering Columns

In UnHerd, Phoebe Arslanagic-Little documents how the NHS is failing mothers contributing to falling fertility rates in Britain and across Europe.

The UK’s total fertility rate is 1.41 and falling. A future of ever fewer children has serious social and economic consequences for us all. Making becoming and being a parent easier, tangibly improving the lives of parents, are clear ways in which we can help those who already want to be parents or have a further child to do so.

And that is what history tells us. By the 1920s, more than 50 per cent of Europeans lived in a country with a below replacement fertility rate. In 1935, the UK’s fertility rate had dropped to only 1.79. Then, the Baby Boom happened and people in countries all over the world began having more children and doing so earlier in life. There is strong evidence that better maternal medicine was a major contributor to the Boom. The widespread availability of blood transfusions and antibiotics made having a child significantly safer and so women became more likely to choose to become mothers or have a further child.

The experience that women have bringing children into the world matters, to those individual women and their partners and families, and to all of us as the need to make parents’ lives better increases. An NHS that believes aromatherapy, sterile water injections and relaxation techniques belong in the same category as highly effective analgesics like epidurals has gone down the wrong path.

In The Times, Melanie Phillips says that Europe needs to return to Christian civilisation in order to survive.

The enemies of the West understand the cultural vacuum that has developed and the opportunities it opens up for them. Vladimir Putin understands it very well as the collapse of European Christian civilisation. The problem is that he imagines himself as a latter-day Russian emperor leading the restoration of Christian Europe. This is held to justify his invasion of Ukraine and potentially the Baltic states too. Far from saving Europe, therefore, he menaces it.

In America, elements within Maga-world can’t grasp this baleful reality. Instead, they identify with Putin in what they credulously believe is a common defence of Christian civilisation. But those in Britain and Europe who are horrified by these Maga ultras should check their own hypocrisy. As Gordon Sondland, a former US ambassador to the EU, has said, it was Europe’s spinelessness that enabled Putin’s aggression.

Britain and Europe have long leeched off the US for military protection while trashing their own defences, along with their historic culture. The NSS warning, Sondland said, was a wake-up call intended to alarm Europe sufficiently to rearm itself and beef up its defences.

Only Britain and Europe can save themselves. That’s what the Trump administration is saying. That’s what Britain and Europe don’t want to hear.

In The Telegraph, Claire Coutinho calls for dropping the government’s clean power target to avoid deindustrialisation and bigger bills.

Britain simply cannot afford to spend the next 25 years with uncompetitive electricity prices. We would continue to deindustrialise, miss out on the economic growth opportunities of AI, and see living standards suffer. Britain’s prosperity derives from our ability to be at the forefront of successive industrial revolutions.

The AI revolution is happening now. If we do not address the cost of our electricity in the immediate term, Britain will fall behind the technological curve for the first time in two centuries and we will be poorer because of it.

The report is also explicit that overbuilding wind power, as the Government plans to do, will mean costs go up as we pay first to build the wind farms, and then pay again to turn them off when it’s too windy. That’s why I’ve been arguing Ed Miliband’s Clean Power 2030 mission, far from saving billpayers £300 as promised in the General Election, is going to cost consumers a bomb whilst multi-million-pound wind developers laugh all the way to the bank.

In Conservative Home, Sir John Redwood argues that Britain would be foolish to ignore Trump’s call for Europe to change course.

How should the UK respond to this underlining of the US approach? There is nothing in the document that should come as a surprise to observers of the presidency. It should encourage Britain to believe in itself, to see and seize the opportunities of Brexit more clearly, and lead the Government to make faster and better provision for a stronger military to take care of our own defence. We need an enhanced shield against incoming drones, missiles and aircraft, stronger defences against interference in our waters, and more attention to cyber warfare and drone technology. It should also persuade ministers to take more urgent and effective action to cut illegal migration. We also need to examine drug dependency and drug trades into the UK as we too like the US have too many people with a serious drug dependency.

It is difficult to know how to handle the breakdown in relations between the EU and the US. The UK agreeing to provide practical military support to help police a Ukraine settlement is currently not relevant, as there is no peace to police and Russia is against European states putting military personnel onto Ukraine soil. The Government is right to rule out committing British forces to fight Russia on the side of Ukraine – but this decision means we should not try to change Ukrainian views over the peace or its commitment to the war, as they are the ones that have to bear the pain and the losses.

The Government is right too not to rush to reply in detail to this extraordinary statement. When an ally speaks out like this it is best to do what we think is right and to let our actions speak rather than any critical words. The message that we need to take more care of ourselves is one we should not ignore.

In The Telegraph, Lord David Frost writes that the left are debasing British culture to undermine support for the nation state.

This ideology asks us to idolise a vision of tolerant, diverse people in strong communities celebrating their differences. But even the Left can see that tolerance, diversity, and equality are firstly not uniquely British, and secondly far too abstract to get emotional about.

So, to bed them in, they have to be given a specific British quality. And since the Left rules out of court all the traditional elements of national identity, all they are left with is this debased version: Paddington the refugee, “meal deals and Mr Blobby”, British greatness encapsulated as a montage of Chicken Shop Date and Sam Fender hungover on breakfast TV.

It isn’t good enough. This isn’t patriotism. It’s a pathetic retreat into kitsch, politics as soft play, a denial of the country’s challenges, even at some level a rejection of the view that those challenges are important because all we need do is be nice to each other. Those of us who still believe in the nation state, in its British or any other version, and who think our civilisation is worth preserving, must not be tempted to go down this road. Instead we must get back to meaningful patriotism, to serious stuff, to this country’s contribution to Western achievements and the things that make this country distinctive.

In The Financial Times, Janan Ganesh says that the world does not face a conflict between civilisations but a clash within civilisations.

Before he died in 2008, Samuel Huntington could have said “I told you so” without too much dissent. The US was then several years deep into its missions in Iraq and Afghanistan. Such violence between the western and Islamic worlds seemed to vindicate the Harvard scholar, who had once segmented the globe into civilisations and predicted a clash of them. As our troubled millennium got going, the word “prescient” followed him around like an extra name.

It is crass to speak of such a thing as a well-timed death. Had he lived to this day, however, Huntington would be taking as much flak as poor Francis Fukuyama does for getting the world all wrong. The important conflicts now are within, not between, civilisations. The C-word has seldom been so popular (the US government talks about Europe’s “civilizational erasure”) and so useless.

Look at the world’s trouble spots. The war in Ukraine is a war within the “Orthodox” Christian civilisation, at least as Huntington classified it. The periodic stand-off between the People’s Republic of China and Taiwan is another example of a tussle inside a cultural bloc — what Huntington called the Sinosphere. A candidate for the deadliest current conflict on Earth, Sudan’s civil war, does not pit a coherent religious or cultural group against another, as such. Even the external patrons of the combatants, which include the UAE on one side and Egypt on the other, are mostly from within the Islamic world rather than distinct civilisations.

In The Telegraph, Nile Gardiner says that the US is right to work with allies in Europe nations to weaken the power of Brussels.

The EU is a real problem for the United States and for the transatlantic alliance. It is dominated by big government, Left-wing ideology, and is sinking under the weight of decades of open-borders policies, threatening the very future of Western civilisation. As Trump and his vice-president JD Vance have made clear, Europe faces an existential crisis of its own making, while adversaries such as China and Russia are seeking to exploit Europe’s weakness.

It is in America’s national interest to work with sovereign nation states that share its values, and are based on democratic accountability. As Musk has declared, “The European Union is not democracy – rule of the people – but rather bureaucracy – rule of the unelected bureaucrat.”

Obviously, the United States cannot unilaterally abolish the EU, which was originally established as the European Coal and Steel Community in 1951 with American support. But it can actively back the cause of national sovereignty and self-determination across Europe, challenging the power of Brussels, and stand with European movements that seek to throw off the shackles of the EU machine.

Subscribe now

Wonky Thinking

Rian Chad Whitton has published a new report for the The Prosperity Institute detailing how Net Zero is destroying the our industrial foundations.

Given the dire straits of Britain’s energy-intensive industries and the expectation of significant turbulence in the global economy going forward, it is clear why governments feel compelled to offer industry exemptions and even subsidies for energy prices, and to takeover failed operations like British Steel and Speciality Steels. However, these are reactive measures that do not alleviate the largely self-imposed conditions of decline. Time is running out to change the course of Britain’s deindustrialisation. Improving British electricity price competitiveness will take between five and ten years, but large sections of the energy-intensive industries could be severely diminished within just 24 months without course correction.

Any government support for industry must be supplemented by a real plan to improve industrial competitiveness, prioritising low energy costs, reducing and removing onerous regulations, and cutting back self-defeating mandates. Approval of active industrial policy has to be contingent on supply-side reform.

British government policy can immediately be improved at the conceptual level. The Office for National Statistics annually provides estimates for the LCREE. This collection of industries is prioritised through Government policy in the form of subsidies, levies, research grants and direct funding. Yet it has a small turnover of £70bn versus over £200bn for the foundational industries. From now on, the energy-intensive sector should take priority over the green sector when considering government targets for revenue growth and improving prosperity outside of London.

The Migration Advisory Council has published a report on The Fiscal Impact of Immigration: Static and Dynamic Estimates for the UK which estimates the contribution of migrants.

Overall, the SW [Skilled Worker] visa route is clearly fiscally positive for the UK. This is almost inevitable given that main applicants on the route must have a job offer paying above a set of salary thresholds. This means that these migrants have higher employment rates than UK residents since employment is a condition of the visa and as we shall demonstrate, salaries on the SW route are significantly higher than UK average wages. For the 2022/23 cohort as a whole, we estimate a present value net fiscal contribution of around £47bn over their lifetime. However, this estimate hides very substantial heterogeneity. The entire positive contribution comes from main applicants – particularly those outside of H&C [Health & Care]. Dependants have relatively small overall lifetime contributions which are negative in aggregate. Furthermore, even within the highly positive SW (excl. H&C) main applicants, 72% of the fiscal gain comes from the top 30% of earners.

More broadly our results highlight two key determinants of fiscal contribution over the lifetime for migrants. First, the age at which the migrant arrives in the UK. Migrants are typically aged in their 20s and 30s when they arrive, and this is an age at which the future lifetime contribution is most likely to be positive since it avoids the fiscal costs of childhood and allows for a substantial period in the labour market to make significant tax contributions. To put this £47bn figure in context, the present value of total government spending over the lifetime of this cohort is estimated to be around £26,700bn.

Second, the employment rate and wages that migrants achieve. Those who arrive on sponsored work routes are more likely to be fiscally positive, whilst the contribution of their dependants (adult partners) will depend on the extent to which they work and the wages they receive. Visa routes that do not have work requirements will therefore generally be less fiscally positive (or be fiscally negative) than the results reported here for the Skilled Worker cohort. Furthermore, just like for UK residents, fiscal contributions are heavily skewed toward high earners given the progressive tax system. This highlights the importance from a fiscal perspective of attracting global talent and creating a policy environment than encourages such workers to remain in the UK.

This table summarises the estimated lifetime totals for migrants arriving in 2022/23.

Subscribe now

Podcast of the Week

Professor Dieter Helm discusses the reasons why our economy has struggled to grow in his latest podcast. Helm argues that Western economies, especially the UK, prioritise consumption over production, rely heavily on welfare spending, and maintain incentive systems that discourage work.

Subscribe now

Quick Links

The economy contracted by 0.1% in October.

The economy is smaller today than it was before the pandemic.

British taxpayers pay more income tax than French taxpayers.

Fewer than a quarter of grooming gang suspects were arrested last year.

Four in ten asylum seekers remain in Britain despite being rejected.

The First Sea Lord says Britain is close to losing the Atlantic to Russia.

The CBI says Rachel Reeves’ tax rises are driving up unemployment.

Experts say we cannot fight a war lasting longer than a few weeks.

China’s trade surplus with the rest of the world has passed $1 trillion.

The UK’s former Head of Nuclear Policy says our nuclear submarine fleet is ‘no longer fit for purpose’.

Towering Columns

On his Substack, Neil O’Brien unpacks Reeves's tangled Budget.

What a mess. No-one can recall a messier Budget. What was the underlying problem? I’ll tell you: they tried to be too clever by half. We now know that Reeves knew all along she wasn’t facing a big black hole. The OBR told her on 17 September that the downgrade in productivity forecasts was offset by tax rich growth and inflation. Despite that, the Treasury were happy to stoke the idea that there was a huge black hole that would mean that income tax rates would have to rise.

Why did they stoke this? Simple: they wanted, on Budget day, to be able to reveal “more-positive-than-expected numbers” and then announce that there would be no change in rates - a nice budget “rabbit”. Hurrah! It is hard to overstate how dishonest the government were. On 5 November, we now know that Reeves knew that the OBR were forecasting billions of headroom against the government’s fiscal rules…but she still went on TV with an unprecedented pre-budget to create the impression that big tax rises were coming because of a deterioration in the public finances.

At no point in the process did the OBR have the government missing its fiscal rules by the large margins the government were briefing journalists about. (Remember the black hole of 20 billion or even 30 billion they told journos about?)

Reeves even argued two weeks before the budget:

“It would, of course, be possible to stick with the manifesto commitments, but that would require things like deep cuts in capital spending.”

She said this, though she knew it wasn’t true…

…Why did they announce no rate increase beforehand? At some point someone in HMT panicked that markets might react badly to this last-minute surprise, and so reversed course - which really did spook the markets…What the Budget really does is not plug an imaginary black hole - but increase spending (mainly on welfare) and increase tax.

In The Telegraph, Gavin Rice says Britain’s finances will only stabilise if basic rate taxpayers share more of the burden.

The ultra-redistributive approach towards tax was pursued by the Conservatives for noble reasons – to protect modest earners from the impact of rising spending liabilities due to pensions, the NHS and the cost of the pandemic. It was achieved through the roll-out of the personal allowance and cuts to employees’ National Insurance. As a result, the average working household paid nearly £2,000 less tax on income in real terms in 2024 than in 2010. This provided some compensation for the lack of wage growth over the Tories’ 14 year term, and allowed the party to announce tax cuts for the majority while squeezing higher earners.

This incessant downwards pressure on the tax liability of basic ratepayers followed in the footsteps of Gordon Brown, who famously cut the rate to 20p while hiking taxes overall. The combined approach of taking ordinary people almost entirely out of tax was a kind of silent cross-party conspiracy. Liz Truss was wrong about almost everything – including wanting to cut the rate to 19p. But she was right about one thing: the “Resolution Foundation” approach to budgets, where every tax change must be even more progressive than the last, must end.

As tax experts Dan Neidle and Paul Johnson have noted, this squeezing of so-called higher earners is running out of road. The so-called “Henrys” – High Earning, Not Rich Yet – may just up sticks and leave, or choose to work less, given the incentive-destroying tax rates they face. The income distribution is already far too bunched, with the minimum wage rising to nearly 70 per cent of the median. What then is the incentive to work? Those earning £50-£150,000 are among the most productive in the economy. Why are we persecuting them? Broadening the tax base is not inconsistent with lowering the overall national tax burden. We need both.

For The Times, Juliet Samuel says Keir Starmer’s government is hamstrung by quangos and regulators it doesn’t control.

Ministers adopted their habitual pose of what the shrinks call “learned helplessness”, whereupon, realising they were going to have to explain themselves, they blamed the CPS and an obscure security official. The excuse was that the case’s collapse was the necessary result of Labour’s admirable respect for the sacred “independence” of legal process (this never quite explained the appearance of Labour’s mealy-mouthed manifesto language on China in the official government witness statement, but never mind).

Just as with the OBR, this denial of responsibility by ministers immediately triggered the release of an unprecedented series of “clarifying” letters from the agency concerned, which, with knife-like precision, used bureaucratic jargon to scrape the excrement directly on to ministers’ heads. Now we have the denouement, with a joint committee report on the debacle, concluding that they were all to blame, the bungling lawyers and the self-abnegating politicians forming an alliance of ineptitude in which the chief victim is national security.

One might wonder how it is that a government led by people whose main self-professed virtue was their worship of concepts like “civil service independence” and “the ministerial code” could find themselves not just in briefing wars but under direct fire by official letter from the very institutions they claim to treasure. Not even the nose-thumber-in-chief Boris Johnson managed to get into a direct scrap with the CPS, for goodness’ sake. As for the OBR, one of Reeves’s first acts was to pass legislation giving it formal power to publish its views on public finances regardless of Treasury directions, on the basis that this would make it harder for future, unscrupulous governments to fiddle the books. I suppose she would know. By their own standards, the government is guilty of undermining the “independence” of hallowed arm’s-length bodies. But the real crime is far greater: a failure to have any politics, to know what politics is for, to realise that the job of a leader is not merely to pay homage to bureaucracy but to renew and replenish the vitality of our institutions so we are fit to flourish in a new era.

Also in The Times, Simon French says energy inflation has devastating ripple effects through the economy.

One policy area stands out more than most. In the mid-2000s the UK had the same industrial electricity costs as the United States. At 3.8p/kWh the UK’s electricity costs were the same as the average of all the countries that are members of the International Energy Agency (IEA). Two decades on, this price has risen six-fold. UK electricity prices are now the highest in the IEA, and 2.5 times higher than US industry electricity prices. This permeates all parts of the economy from the hairdresser’s heating its salon, to the pub warming its bar area, to the manufacturer powering its machines. Hyperscalers are not going to bring their AI-fuelled activity to the UK given their huge appetite for energy. Almost every domestic price, at some stage in the production process, comes into contact with energy costs.

While some of this higher energy price — particularly since 2022 — has been the result of volatile gas prices associated with the Ukraine war, that commodity price has now reverted close to its pre-war level. Yet the prices facing business remain penally high. In November, Neso, the National Energy System Operator, released a discouraging report on the outlook for UK gas supply security. The UK is on track to supply just 3 per cent of its own peak gas demand by the winter of 2035, having supplied an average of 36 per cent over the last decade.

More maddening still is that the shortfall is being filled by Norwegian supply from the same geological area as the UK, or by more polluting and less secure imported liquefied natural gas (LNG) from countries such as the US and Qatar. It is hard to think of a more damaging policy for living standards, for inflation, for tax revenue and for growth than the UK’s approach to securing a stable supply of natural gas. This failure also enables alternative suppliers of energy to the UK to keep their prices elevated, rather than face the scrutiny of competition.

And in The Telegraph, Lord Frost says Keir Starmer’s unpopularity may cause Labour’s plan to harmonise with the EU to backfire.

Want to get rid of net zero? “Sorry Minister, you’ve signed a treaty with the EU on that.” Want to free up our food sector with GMs and novel foods? “Sorry Minister, the EU sets those rules.” Want to cut needless over-regulation of cars? “Sorry, Minister, we are following EU rules on this.” This is the current direction of travel. Every time we accept the EU’s laws we are making life more difficult for ourselves and limiting our own choices.

I wish I heard these arguments made more often and more assertively by the Conservatives and Reform. Yes, both parties say they will reverse the reset – though perhaps not more than that. But the argument is couched too much in political terms, an accusation that Labour are “betraying” Brexit and the voters.

I don’t think it helps to speak in those terms. Voters need to be reminded that we risk moving from being a nation where ministers can decide the country’s future and have real choices about economic policy, to one where they can’t and don’t. Voters need to understand that the zombie figure of the Brexit hit to growth of 4 per cent, 6 per cent, 8 per cent, whatever figure it is today, is nonsense, and why – a totally implausible number unless you think that Britain would have been growing nearly as fast as America in recent years. Without such proper, serious, discussion once again about the EU relationship, not about whether we want a “new partnership” but what the hard economic trade-offs are, the case for economic freedom and independence seems to me to risk going by default.

Finally in The Times, Emma Duncan says Reeves’s Budget only deepens the unfair social contract facing younger voters.

First, even before the 2008 financial crisis productivity growth slowed around the rich world. Outside America, whose fast-paced economy is supercharged by tech, real incomes haven’t increased much in recent years. Confidence in the future has evaporated: 79 per cent of parents in this country — the highest number among 36 countries surveyed other than France — think their children will be worse off than they are. Second, Britain stopped building enough houses. Nimbyism took hold, planning became increasingly restrictive, regulations raised the cost of construction and demand among foreigners for property in London surged. Housing became unaffordable for the young. Third, there was a series of economic shocks. The financial crisis meant the banks had to be refinanced; the pandemic led to another splurge of state cash; the Ukraine war drove up inflation and interest rates. The national debt ballooned from about a third of the value of the economy before the financial crisis to almost the entire value of it now. Since debt is a claim on the incomes of future generations, that’s a burden we’ve placed on our children.

It’s not just debt that is going to weigh heavily on the young. A lower birth rate means the old age dependency ratio — the number of pensioners per 1,000 working people — is due to rise from around 280 now to 341 in a couple of decades’ time. Some of those pensioners have enough private savings to finance their retirement, but the workers of the future will be paying the state pensions of the future. The government should have used the budget as an opportunity to mitigate these problems. However gloomy we may feel, in fiscal terms these are the relatively good times. We’re not in the middle of a crisis or a recession, and this week the government got an unexpected break from the Office for Budget Responsibility, which downgraded productivity less than had been anticipated while projecting higher tax revenues because of higher-than-expected earnings.

The government has used some of the bonus to provide itself with more headroom in case of future shocks, but a larger sum has gone on extra welfare spending, including £3 billion on lifting the two-child benefit cap. The state continues to favour the old over the young: the triple-lock on pensions is staying and the level at which student loans have to be repaid has been frozen, bringing more young people into that net.

Subscribe now

Wonky Thinking

Alex Chalmers published a report for the Centre for British Progress arguing for a major overhaul of UK defence procurement.

UK defence procurement routinely misses cost and schedule targets, leaving the armed forces without the equipment they need, when they need it. This is the product of five sins:

1. Overspecification – a bias towards bespoke, over-complex projects that take on unnecessary technical risk when simpler, proven options exist.

2. Inter-service rivalry – competition for prestige and budget between the services, driving duplicated capabilities and distorting investment decisions.

3. Short-termism and optimism bias – persistent underestimation of cost, time and risk, reinforced by annual cash limits and frequent churn in project leadership.

4. Weakening sovereign capability – a “feast and famine” pattern of orders and a failure to take a strategic approach to sovereignty that have hollowed out critical UK-based industrial capacity.

5. Slowness to innovate – procurement cycles and commercial rules that favour large primes and pilots over rapid adoption of software-driven, AI-enabled capabilities.

To tackle these five flaws, we should:

Overspecification – flip the default from bespoke design to proven kit:

• Require an “off-the-shelf test” for every major project, with bespoke development allowed only via explicit ministerial direction.

• Freeze requirements after nine months, with any later changes signed off by the Secretary of State and funded from the sponsoring Service’s own budget.

• Create a permanent “90-day fast lane” for buying trusted, unmodified NATO/allied equipment off the shelf.

Inter-service rivalry – strengthen the centre while pushing some power closer to the frontline:

• Extend the National Armaments Director’s (NAD) tenure to match major programme timelines, ensuring continuity and accountability.

• Establish an independent UK CAPE-style cost analysis unit to provide unbiased estimates of cost, risk and alternatives.

• Give the NAD a concept-stage veto on new programmes, overridable only by a public ministerial direction laid before Parliament.

• Publish a quarterly readiness ledger, signed by the NAD, to expose raids on spares and training used to balance in-year budgets.

• Increase brigade-level discretionary spending authority for off-the-shelf purchases that meet urgent operational needs.

Short-termism and optimism bias – align money, incentives and reality:

• Adopt P75 cost and schedule baselines for all projects over £20 million, with clearly ring-fenced contingency.

• Introduce automatic multi-year capital flexibility for the Equipment Plan so funding can move between years without constant Treasury approval.

• Keep Senior Responsible Owners in post for at least five years, with incentives linked to delivery rather than initial approval.

Weakening sovereign capability – use procurement to rebuild resilience where it matters:

• Disapply current social value criteria in defence, which add cost while doing little to strengthen strategically relevant UK capacity.

• Introduce a consistent UK prosperity weighting for selected categories, heavily favouring meaningful UK activity (employment, IP, supply chains, manufacturing and assembly).

• Professionalise defence procurement as a strategic supply-chain function, recruiting experienced commercial leaders and using combined government data to map and develop the UK defence-industrial base.

Slowness to innovate – create a real market for challenger defence technology:

• Make “time to first use” a core metric in business cases, with every project required to set and justify an explicit band for time to deployment.

• Focus accelerators on genuine start-ups, moving later-stage firms into mainstream procurement routes.

• Unbundle hardware and software in major contracts so specialist software companies can compete directly rather than through primes.

• Remove entry windows from framework contracts, moving to rolling, dynamic markets that new suppliers can join at any time.

• Sponsor security clearances and provide central secure facilities for early-stage firms to break the current “no clearance, no work” trap.

• Allow initial batch production outside standard competition rules, within defined caps, to test promising technology at scale.

• Enforce the 10% ringfence for novel technologies, with published criteria and transparent reporting on how funds are used.

• Permit upfront, in-full payment for selected contracts to enable start-ups to build factories and scale operations in Britain.

Subscribe now

Podcast of the Week

On Monetary Matters, Michael Pettis discusses China’s “involution trap”. Pettis describes how for decades the global economy has relied on China suppressing domestic consumption to create manufacturing trade surpluses, and why the US trade deficit is only growing.

Subscribe now

Quick Links

The Chancellor was accused of forcing the head of the OBR to resign, after the watchdog accidentally published its analysis of the Budget in advance.

The political editor of the BBC accused the Chancellor of misleading the public in the run-up to the Budget…

…while she also stands accused of misleading the Cabinet over the existence of a fiscal black hole.

A leaked policy document showed Labour planned to use a private member’s bill with government support to legalise assisted suicide while it was still in Opposition.

The global S&P manufacturing index was at a 14-month high…

…but global construction showed its steepest fall in more than five years.

The Institute of Directors’ Economic Confidence index hit record lows.

Business leaders said they will have to cut jobs and investment after the Chancellor’s property tax raid.

Tax changes introduced in the Budget may threaten employee ownership.

The West Midlands Police gave evidence to Parliament, accusing Dutch police of altering their evidence relating to Maccabi Tel Aviv in response to political pressure…

…and the Government’s anti-Semitism adviser said the force tailored evidence to secure a ban.

The Department for Education awarded the Islamic Finance Committee £174,000 to explore a “Sharia-compliant” model of student finance.

Towering Columns

In The Times, Juliet Samuel says Reeves has fallen back on pumping the economy with welfare spending, abandoning any real commitment to growth.

The main governing principle of this budget, aside from its wholesale and unnecessary surrender to Labour’s back benches, was supposedly fiscal responsibility. But even this rests upon a sleight of hand. While the extra welfare spending flows out of the national coffers immediately, the tax rises come in slowly. Modest cuts to departmental spending, such as they are, are supposed to happen right at the end of the parliament. So we’re meant to believe that Reeves is going to borrow more now, then go back to austerity right before the next election. And even if these measures do go ahead, the OBR says there’s only a 59 per cent chance she’ll meet her fiscal targets — but, to channel Chris Morris, there’s only a 10 per cent chance of that.

In Reeves’s first budget, one could argue that it was politically wise for her to come into office with a big bang of spending for the NHS, neutralising that issue at least temporarily. You could perhaps argue that, even though she immediately and brazenly broke her manifesto promise not to raise national insurance, she was at least putting half the proceeds into public investment, a serious down payment on that new economic model she talked about in Washington.

But with her second attempt, there can be no illusions. The vision of a left-wing government that deploys state power to build faster, incentivise innovation, revive our industrial base, secure our supply chains and protect jobs by uprating Britain’s competitiveness never came to anything more than a single speech. The sum total of Labour’s real vision for the country is higher taxes for bigger handouts.

On Substack, Andrew O’Brien declares we are now in the age of Insecuronomics, with the Budget making Britain reliant on borrowing record sums from overseas.

More worrying is how we are paying for all of this spending. In the short-term we are not really paying for it at all. Our trade deficit is going to be wider at the end of the Parliament than it was at the beginning. We export less than we import. In 2024, we spent £50bn more on imports than we did in exports in 2024. So that’s £50bn heading out the door. By 2030, we will be spending £79bn more on imports than we did in exports. The gap between what imports and exports will increase by 45% over the Parliament.

So far, so bad. But it gets worse. In 2024, we needed to borrow £171bn to pay for the UK’s borrowing, nearly all was the government’s debt. However, higher household and corporate saving could cover most (64%) of our borrowing needs. By 2030, however, although the government need for finance has come down, households and corporates in the UK are now having to borrow from overseas too. Every part of our economy will be going cap in hand to the rest of the world. From 2025 to 2030, the UK is going to need to borrow £667bn from our friends (and not so friends) from overseas.

This borrowing is not free. Our homes, our businesses, our utilities and our future tax revenue (through gilts) are promised in return. The return from these things is what our friends from abroad are interested in. From 2025 to 2030, £372bn is going to leave the UK through higher dividends, debt payments and sales of assets. This is over three and half times the levels of the last Parliament. Our current account balance is going be 1.5% of GDP higher in 2030 than it was in 2024. If we didn’t do this, inflation would skyrocket, making the energy price spike look like a tea party.

In The Telegraph, Allister Heath says the Budget marked the end of property-owning democracy and a victory for socialism.

This is the final death of Thatcherism, of the British dream, of the idea that ordinary people, through hard work, can climb the property ladder: Reeves is the most anti-capitalist and anti-aspiration Chancellor since Denis Healey. She will destroy incentives to extend or refurbish high-end properties – woe betide anybody whose home rises too much in value – cripple the top of the property market and chase away yet more successful people from the UK.

Many on the radical Left believe they are entitled to confiscate privately owned assets, for any reason, and are finally getting their way. They believe that it is “unfair” people don’t pay more tax if they own an expensive home. But why should anybody pay any tax on their property at all, other than a basic fee for local services? It’s legally theirs, so they should not have to hand over any money to keep hold of it. In a conservative and capitalist society, property is a foundational, natural right, not a privilege. Where are the human rights lawyers when we need them?

The logical extension of Reeves’ property tax grab is that the state will eventually start to expropriate a percentage of bank accounts and pension pots too, at least those deemed “too large”.

Reeves is violating every principle of just taxation. Wealth taxes are “dry”, a disaster for the asset-rich but cash-poor, such as pensioners who bought their home decades ago and have accidentally become paper millionaires. To avoid such people having to sell family homes to pay her abhorrent levy, and the accompanying PR nightmare, Reeves is likely to introduce another sinister innovation. She may allow her tax to be “rolled up” and paid when pensioners die, or when they choose to sell their home. This sets another terrible precedent: the Chancellor no longer needs to consider affordability when determining tax. She can simply punish people as harshly as she wishes, and then collect the cash when they die. Her new tax – a toxic mix of two hated levies, council tax and IHT – is equivalent to detonating a time bomb under Middle England.

Socialism is back, and the property-owning democracy is out. Labour has declared war on social mobility, on petit bourgeois values, on the consumer society and on conservative Britain. Starmer and Reeves’s mission was to keep Labour MPs on side. They are about to find out that the rest of the country has no time for their deranged, embittered class warfare.

In UnHerd, Yuan Yi Zhu says financial pressures are now driving the call to abolish trial by jury, a foundation of the British legal system.

It would be one thing if, having decided that the jury was an institution not adapted to modern conditions, the Justice Secretary made the principled decision to abolish it. This view is not without supporters. Lord Bramwell, one of the most distinguished jurists of the Victorian period, once said that, “If juries had to give reasons for their verdict, trial by jury would not last five years.” In fact, it is a crime in England to disclose the deliberations of a jury, which to cynics only confirms the truth of Bramwell’s quip.

But this is Britain in 2025. Lammy needs to abolish juries because there is no money for the legal system, which means that courtrooms sit empty while criminal trials are scheduled for the next decade.

Juries are expensive and time-consuming; hiring judges is also expensive, but they aren’t messy like juries. They won’t collapse trials by going home and looking up the defendant online. They won’t acquit people who throw monuments into a river or people who post threatening things online about asylum seekers. For a Prime Minister who thinks ID cards are a sure vote winner, abolishing juries must seem like a quite clever thing to try.

In The Financial Times, Martin Wolf makes the case that this Budget has stored up risks for the future, wasting an opportunity to use Labour’s large parliamentary majority to reform the economy.

Strikingly, as the OBR notes, the forecast for public sector net borrowing is also worse now than it was in March for every year, apart from 2030 — not surprisingly, the year when targets bite. As the OBR also notes, the Budget delivers a frontloaded increase in spending of £9bn and a backloaded increase in taxes of £26bn. This is sweetness today and sourness tomorrow. That must reflect panic over the unhappiness of the Parliamentary Labour party. Will Reeves’ measures at least be enough to avoid any possibility of further need to raise taxes or slash spending? Possibly not. The OBR concludes that “the probability of meeting the fiscal mandate is 59 per cent, up from 54 per cent in March” — safer, but hardly safe.

What about the measures themselves? They are exactly as expected. Out of a net fiscal adjustment of £22.9bn for 2030-31, £12.7bn comes from freezes in personal tax thresholds, £2.6bn from national insurance contributions on salary-sacrifice schemes, £2.2bn from increases in income taxes on property, savings and dividends and so on and so forth. This sort of scattershot approach is what chancellors do who have no sense of what a good tax system would look like, or lack the courage to attempt radical reforms but desperately need to raise revenue. It was entirely predictable. But how ministers can say with a straight face that using inflation to raise effective tax rates in an arbitrary way is protecting “working people” from higher tax is beyond me.

What is depressing is that a government with a huge majority dares to do so little to transform economic prospects. It is easy to imagine far more irresponsible budgets than this. But the OBR is right that it will not have any positive effect on growth or the efficiency of the tax system. Moreover, it leaves a risky fiscal position, with persistently high debt and already high interest rates. The government could have done better. Indeed, it should have done better.

In The Spectator, James Kirkup says we will see fewer people in work at the end of the parliament than at the beginning.

Work is good. Work generates wealth, makes people happier and, maybe, delivers salvation. The Protestant work ethic is much disputed among sociologists and economic historians, but most people accept that some level of work is both necessary and desirable. This makes it all the more troubling that, buried in the OBR data under the Budget, are signposts to a future Britain where fewer people work at all – and where those who do are working less.

The Office for Budget Responsibility says the labour force participation rate is forecast to fall ever so slightly, from 63.5 per cent in 2024 to 63.4 per cent in 2029. A tenth of a percentage point over five years is not huge. But thinking about the economic future, does anyone think that Britain needs the share of the population that’s not working to be rising?

And the OBR’s footnotes tell a sobering story: participation is falling because Britain is ageing and getting sicker. Long-term sickness keeps rising and is pushing up incapacity benefit caseloads. This is not the country becoming more efficient and so able to make do with fewer workers; it’s a nation quietly becoming less able to work.

In UnHerd, Henry Hill says the flight of young professionals is masking the UK’s ongoing high levels of immigration.

But the overall numbers are still very high. According to the Office for National Statistics (ONS), just under 900,000 people immigrated to Britain in the year after last year’s election. The reason the net figure looks so comparably reasonable is due to emigration.

This poses problems, however. Firstly, a substantial share of current emigration involves EU citizens who arrived in the UK before Brexit. This is a trend that will eventually run its course, which is why the watchdog actually predicts net migration to start rising again by 2029. Secondly, another slice of emigrants are British nationals leaving the country; in the latest figures, this is about 250,000 people.

Some of this will be natural and untroubling. But to the extent it represents productive people leaving the country, for example high earners driven away by raised taxes or young professionals such as doctors seeking better opportunities overseas, it is a poor indicator of national health to which more attention should be paid.

Likewise, it means that cutting net immigration by itself will not, and should not, allay the concerns of voters concerned about integration and the pace of cultural change. If Britain imported one million new people every year but waved goodbye to one million Britons, net immigration would be zero. Yet the pace of change would be double what it would be if all the Brits stayed here and net immigration was one million.

Subscribe now

Wonky Thinking

Guido Fawkes provides a comprehensive list of Think Tank responses to what it calls the “Binfire Budget”.

Britain Remade’s Sam Richards said: “The shambles surrounding the launch of this miserable Budget should not distract from the Government’s abject failure to deliver their number one priority: economic growth.”

The Centre for Social Justice blasted the “Buckeroo Budget”, with policy director Joe Shalam saying: “A government with a majority of 169 has set out a Budget penned by its backbenchers. But throwing money at the problem, paid for by a squeeze on the workers and savers of middle England, will eventually cause a kick.”

Onward’s director Simon Clarke said: “Today’s Budget compounds the damage inflicted a year ago: slower growth and lower productivity alongside higher taxes and more welfare spending.”

The Institute of Directors‘ Anna Leach said: “This Budget does not substantively change the UK’s growth outlook. Public spending is higher, and business investment even lower than before. The scaling back of National Insurance relief on pension contributions – even while the government has launched its Pension Commission – will undermine retirement savings and the very investment pools that we need, as well as heaping further costs on employment.”

In a guest post for Eric Kaufmann’s Centre for Heterodox Social Science, Robin Young analyses the economic effects of Diversity, Equity and Inclusion policies and their impact on the economy. Young argues that they have significantly contributed to the reduction in growth since the financial crisis.

Over the past 15 years, the UK’s economic performance has sharply declined. Between 1960 and 2010, UK GDP per worker (productivity) grew by an average of 2% annually, but since 2010 it has fallen to less than 0.7% annually. Two major recessions marked this period: the 2008 Global Financial Crisis (GFC), which took 5½ years for activity to return to pre-GFC levels; and the 2020 pandemic, which triggered a steep V-shaped recession.

These events mark the beginning of each recession, but the decline in trend growth requires further explanation. Other factors, beyond the UK’s dependence on financial services, include demographic issues, a shift towards an IT era, Brexit, and specific microeconomic challenges. Nevertheless, many of these are longstanding, gradual issues, some of which predate the GFC. Notably, the rise of the DEI complex occurred shortly after the start of the GFC, and the pandemic coincided with a more intense surge of DEI advocacy following George Floyd’s death in May 2020.

Disentangling the macroeconomic effects of these events is challenging, considering that expenditure on DEI programmes is minor compared to the size of the UK economy. However, the impact of the DEI complex extends beyond spending on DEI initiatives, subtly but significantly affecting potential growth through increased regulation, bureaucratic oversight, and a misallocation of resources. Additionally, there is little evidence supporting a ‘diversity dividend’ in terms of improved corporate productivity, performance, or profitability.

New research by the Centre for Clean Energy Innovation in the United States found that electricity demand for AI is rising rapidly and that without action the US could end up accidently killing its AI industry. The research recommends energy companies and tech businesses working together to shift AI energy demand to off-peak periods without damaging their businesses.

When change was slow, regulators and utilities could cope quite easily. But now change needs to be very fast. Utilities want to serve the new demand but are cautious about building out large new facilities without guarantees that demand will in fact be there when they come onstream in 5–10 years. After all, Google just announced that the energy cost per text query fell by 93 percent in 2024 alone; maybe all that demand will just never happen. And regulators are wary of adding huge new costs to the existing rate base, especially as costs come before the revenues do, thereby adding risk. Electricity prices are driven by multiple factors on both the supply and demand sides, and data center demand is only one variable among many; the drivers of electricity demand are in fact incredibly complex. But without new capacity, adding huge new demand to the grid will have inevitable consequences when supply is constrained in the short term (next 5–10 years): either prices go up, energy allocations move from existing consumers to new ones, or both.

Simply opening the door to new demand would be normal for most markets. Prices would go up for a bit, new supply would come online, a new competitive equilibrium would emerge. And in theory, that would work for electricity as well. Perhaps it should—but it doesn’t. Regulators are not prepared to let new entrants disrupt existing supply, as they are responsible for keeping prices stable as best they can, and are generally risk averse. The price of electricity has already been a sore point for politicians, and while AI companies have plenty of high-level friends, public perspectives are less positive. At the same time, environmentalists and other long-term foes of AI and innovation more broadly see this as an opportunity, and have pressured regulators to deny data center requests.1

But strangling AI by accident via electricity shortages is not smart, and won’t work—it simply hands advantages to other countries and encourages U.S.-based companies to go offshore where their energy needs will be met.

Subscribe now

Book of the Week

In Breakneck, Dan Wang documents China’s megabuilding projects and how the US stopped investing in its infrastructure. Wang says the battle between China and America over the coming decades pits the “lawyerly society” against the “engineering state”.

We are now in an era where the two countries regard each other with suspicion, and often animosity. Like China, the United States is able to move fast and break people, dealing tremendous brutality at home and abroad when it feels threatened. A paramount question of our times is whether hostility between China and the United States can stay at a manageable simmer. Because it if boils over, they will devastate not only each other but also the world.

The best hedge I know against heightening tensions between the two superpowers is mutual curiosity. The more informed Americans are about Chinese, and vice versa, the more likely we are to stay out of trouble. The starkest contrast between the two countries is the competition that will define the twenty-first century: an American elite, made up of mostly lawyers, excelling at obstruction, versus a Chinese technocratic class, made up of mostly engineers, that excels at construction. That’s the big idea behind this book. It’s time for a new lens to understand the two superpowers: China is an engineering state, building big at breakneck speed, in contrast to the United States’ lawyerly society, blocking everything it can, good and bad.

Breakneck is the story of the Chinese state that yanked its people into modernity - an action rightfully envied by much of the world - using means that ran roughshod over many - an approach rightfully disdained by much of the world. It is also a reminder that the United States once knew the virtues of speed and ambitious construction. Traversing dazzling metropolises and gigantic factories, Breakneck will illuminate the astounding progress and the dark underbelly of the engineering state. The lawyerly society has virtues, too, to teach China. Each superpower offers a vision of how the other can be better, if only their leaders and peoples care to take more than a fleeting glance.

Subscribe now

Quick Links

Labour u-turned on rights promised in its flagship employment bill.

Leaked documents from The Home Office show more than 53,000 illegal migrants are missing.

Freezing tax thresholds will hit higher rate taxpayers by £600 per year but additional rate taxpayers by £390.

But British basic rate taxpayers are still among the least taxed in the developed world.

Over 100,000 British nationals under the age of 35 have left the country.

Changes to the two-child welfare cap will disproportionately benefit migrants.

The Justice Secretary has proposed scrapping jury trials except for alleged rapists and killers.

House prices will rise but transactions will fall over the Parliament after the Budget.