Towering Columns

In The New Statesman, Andrew O’Brien writes that devolution is the sign that Westminster and Whitehall have given up on governing.

The truth is that Westminster and Whitehall have experienced a crisis in confidence. The destructive forces they unleashed to create a “dynamic”, global, service-based economy have deindustrialised and demoralised communities across the United Kingdom through a lack of support for industry and underinvesting in infrastructure. These forces have already seen Scotland and Wales turn their back on the metropole. Now the same forces are ripping through England, particularly the North, creating a new revolt against the centre. Instead of confronting this challenge and forging a new political economy, Westminster has convinced itself that the solution is to give up. Worse, in many cases the plan is to continue the failed economic policies of the past several decades but push political responsibility down to a regional level, in the hope that this will spare the centre from relentless criticism…

If London, with all its agglomerative power, could not withstand the impact of the financial crisis and generate momentum for a recovery, how is the North East supposed to overcome decades of deindustrialisation? How will providing control over 2p of income tax help the Greater Lincolnshire Combined County Authority save the region’s steel industry or set up new industrial clusters? Even the federalised and much vaunted German states with their Mittelstand of specialised manufacturing businesses are struggling to resist Chinese overproduction.

In many ways devolution is a strategy for yesterday’s economy, an economy that benefited from a stable global order, a temporary boom in financial services and relatively free trade. Ironically, the same was true for the “golden age” of Victorian municipalism in the mid-19th century. However, in the world of cutthroat great power competition and a battle for production, devolution is irrelevant.

For The Telegraph, Ben Houchen says that Burnham will fail if he tries to govern the country like a Mayor.

But the Burnham story has a structural flaw that his admirers have never properly examined. He has governed, for nearly a decade, in a role that is built to shield you from the hardest decisions in public life. I know that, because I’m a regional mayor too. We control devolved budgets for transport, skills and economic development. We attract investment, announce funds and champion our places on the national stage. We rarely make the calls that lose you friends, crater your poll ratings and keep you awake wondering whether history will forgive you. We don’t control welfare, set tax rates or face the bond markets when a fiscal commitment unravels. The architecture of the role keeps you, by design, once removed from the genuine brutality of true governing.

Burnham has exploited that reality brilliantly. We saw it during the Covid pandemic, when all he had to do was criticise the Government – and there was no shortage of material. His mayoralty has become the politics of perpetual announcement: new funds, new projects, new ambitions, all received with something approaching reverence in Greater Manchester. He even held formal responsibility for the region’s police force – one of the largest in the country – while delegating operational oversight to his deputy mayor.

The difficult calls, in other words, were managed away. And for nearly a decade he inhabited a political environment in which the answer to most problems was bashing Westminster, a new fund, and another platform appearance at which people cheered. That environment has no equivalence in Downing Street, and the habits it breeds are precisely the wrong ones for the job he is about to take on.

For The Times, William Hague argues that decentralisation is no substitute for taking tough decisions on the economy.

The new PM will need an iron chancellor to cut welfare spending and central government departments, without increasing tax burdens, if local power is to stand a chance of success. He should make his choice with that in mind, quietly and ruthlessly. At the moment, leaks and rumours about who is in the running risk leading to a power struggle over the job that will make it harder to choose the right person.

The second and perhaps greatest challenge is that the technological revolution sweeping the world threatens to swamp all these hopes and good intentions. Burnham recognised the pressing need for government procurement to support innovative UK businesses. But the “reindustrialisation” he advocates will happen only if we are at the forefront of robotics and entirely new manufacturing techniques. The jobs for young people will only be there if we are home to digital industries. Rewiring the British state for both the opportunities and dangers of AI is the most vital rewiring of all. Yet AI did not feature in this defining speech. The political, ethical and economic issues it raises will insert themselves into every hour of his premiership.

After this speech, the hope that Andy Burnham is trying to offer is clear enough. Devolution of power is his central mission. He should add financial discipline and rapid adaptation to new technology as equally vital missions. If not, they will overwhelm him.

In The Spectator,Stephen Daisley says that we need to learn from the failure of devolution to stop the decline of Scotland and Wales.

Indeed, Burnham has already let it be known what he thinks of the efficacy critique of devolution: in Scotland and Wales, he is proposing to devolve more powers to local authorities, rather than Edinburgh and Cardiff, because ‘the people of Dundee and Bangor feel just as distant from Holyrood and the Senedd as they do from Westminster’.

To anyone else, this would be an indicator that something had gone wrong; to the devolutionist, every failing of devolution is proof that more devolution is needed.

A truly radical government would accept that the devolution experiment has failed and resolve to reverse course rather than allow this constitutional malady to fester further. Saving Britain from national decline will require a national government, made up of men and women of ability, united around a common purpose, not the fractured nation-state Britain has devolved into, with power fragmented across rival seats of political authority which share no vision for the future. Why does Andy Burnham want to be prime minister if he would rather give power away than use it?

For The Critic, Charlie Napier warns against the condescending ‘Northernism’ that sees the North of England as different to the rest of the country.

The Burnham phenomenon is the most extreme example of Northern memetic power yet; it also reveals the more condescending side of Westminster’s obsession with the place. Burnham has the right accent. He “talks like a normal person” and so seems like he “gets it”. He was successful in Manchester because he threw lots of taxpayer money (mostly from the South) at showy infrastructure projects. He is, for the Labour Party, the perfect candidate — he can win over the North, without actually having to deal with the grievances of those who live there. But the lazy Westminster fixation on this imagined “North” is profoundly unhelpful. It starts from the wrong place, and reaches the wrong conclusions.

For a start, the North of England is a fairly diverse place, with varied economic interests and cultural orientations. The Irish Catholic, working class cities of Liverpool and Manchester are quite different to the uplands of North Yorkshire, and both are quite different to leafy Cheshire. Many in Newcastle wouldn’t even consider Manchester to be part of the north, being some three hours away by road; for those on the banks of the Tyne, Edinburgh is physically closer. But, more importantly, the North is just not that different from the rest of the country, and certainly not as far as politics is concerned.

When asked whether immigration has been too high over the last decade, 72 per cent of people in the North say that it has been according to YouGov’s latest tracker. But, 73 per cent of people in the non-London South, and the same number in the Midlands, agree with them. 73 per cent of people in the North say that the Government is handling the economy badly — the exact same proportion as in the non-London South.

The average salary in the North West is higher than that in the South West. The North East may have the lowest salaries in the country, but it isn’t much behind the East Midlands. According to the ONS, a town like Blackpool, where 35 percent of people are “deprived” in one way or another, is doing better than many coastal communities in the South — places like Torbay, Gosport, Thanet, and Clacton.

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Wonky Thinking

Onward has launched new research on how to get London building housing again. The report identifies three areas for new mayoral development corporations including Southern Tower Hamlets, Old Kent Road and Park Royal which could add nearly 500,000 additional homes, as well as estate regeneration to double the density of London’s low-rise post-war council estates that can add hundreds of thousands of new properties. The report also proposes:

• Give homeowners greater choice over their properties, permitted development rights should be expanded to allow for full-size loft and rear extensions. Local authorities should create design guides for acceptable extensions within conservation areas. The Housing Secretary should also issue a statutory National Development Management Policy to create a national ‘yes unless’ route for household extensions that require a planning application, and should pass the necessary secondary legislation to implement ‘street votes’.

• The conversion of existing commercial properties into homes should be made easier through the removal of regulations that prevent conversions, stricter limits on councils creating Article 4 directions that stop easy conversions, and the introduction of a statutory National Development Management Policy that explicitly encourages conversions and bans councils from introducing onerous barriers.

• Around £18bn a year is spent subsidising people to live in London via the benefits system. This distorts the housing market and favours people who are out of work over working Londoners – at the taxpayer’s expense. We need to end absurdities like million-pound council homes and encourage more win-win transactions. The Housing Secretary should use existing powers to encourage councils to sell off expensive social housing when it becomes vacant, with the proceeds used to fund the construction of more homes. There should be a national cap on housing benefit and the Universal Credit housing component set at the median national rent for each house size for future claims. Finally, we should revive and improve the Right to Buy and expand it by including housing association properties.

On his Substack, Neil O’Brien lays out the options for tax rises under Andy Burnham. Compared to the last Conservative Budget, spending will be £152 billion higher in 2028/29 and taxes will be £105 billion higher and borrowing will be £47 billion higher. To make the numbers add up, Labour will likely raise taxes and Neil looks at five potential tax areas, including a new land and property value tax:

Burnham criticised the current council tax system and called for a land tax. In his leadership launch speech he said: “It’s a highly regressive tax, and I think it’s not justifiable based on those 1991 valuations. I see a big case for land and property and business taxation to be changed”

Specifically, he signed up to support the ‘Fairer Share, The Proportional Property Tax’ campaign. The proposed tax is a ‘flat rate of 0.48 per cent on the current value of your property’. In the version the “Fairer Share” campaign advocates, the government would use this money to scrap Council Tax and Stamp Duty, and the whole thing would even out. But Burnham needs tax revenues, and it is particularly hard to see him copying Kemi Badenoch’s commitment to abolish Stamp Duty. So he might focus on just the property tax element: the takeaway part without the give-back part.

A 0.48 per cent annual property tax would raise about £44 billion³. Council taxes across the UK raise about £50 billion. So Burnham could do the property tax bit, cut council tax a lot (perhaps abolish it for lower bands) and still raise some money overall.

The argument against this is that you would have a massive and very visible new tax on people, potentially on top of Council Tax. The proposal is basically the old domestic “Rates”. Though no-one now remembers it now (because of the Poll Tax disaster) the old “Rates” were very unpopular. In particular they hit older people who wanted to stay put in areas that had become more expensive over time⁴. Even a shift from council tax to rates would create huge redistribution, with some really massive losers in areas with expensive property. This would be a sort of “core vote” strategy, except that it would also wallop the seats Labour hold in London…

Conclusion

I have already met a couple of people who are changing their plans because of this tax speculation. Either trying to dispose of assets before a CGT hike, or thinking about where to locate business.

Burnham needs to realise that tax speculation is itself damaging - as Reeves’ experience last year showed. The UK economy is really limping along already, and youth unemployment has gone from being lower than the eurozone to higher under Labour.

I obviously think that we need to cut spending and cut tax and get the economy moving.

But if Burnham is going to raise our taxes even more (please don’t) then he should make up his mind fast and end the damaging speculation. But what are the chances of that? Anyone’s guess…

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Podcast of the Week

On his podcast this week, Economist Professor Dieter Helm looks at the nationalisation debate. Using buses, rail, water and electricity as examples, he argues that public ownership and public control are not the same thing, and that different sectors require different models of organisation, regulation and investment. While the nationalisation debate is useful, Helm says that we need move beyond rhetoric towards detailed questions about ownership, regulation, incentives and the proper role of the state.

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Quick Links

Spain’s immigration amnesty has drawn 1.2m applications, more than twice what was expected.

The NHS is going to provide shopping vouchers for people that walk 20 minutes a day.

The Department for Culture, Media and Sport has quit the X social media platform.

House prices have fallen again in June.

The government is rumoured to be cancelling its contract with Palantir for the NHS.

OpenAI is considering giving the US Government a 5% stake in the business.

Towering Columns

In The Times, Juliet Samuel argues Burnham’s philosophy of ‘Manchesterism’ risks ending up a vague political slogan unless backed by clear strategy.

With leadership fever gripping left-wing policy circles, however, this rather tedious, technical, business-friendly blueprint has become something different. A paper by two Burnham allies published by Mainstream, a Burnham-supporting group, makes some pretty wild claims for Manchesterism. It is, according to Mathew Lawrence and Alex Williams, “the practical proof of concept for the Productive State”, which shows why we should embrace “public control of essentials” such as “water and sewerage, energy networks and rail infrastructure, alongside social housing and social care”. Manchester doesn’t have public control of any of these sectors, but let’s not dwell on that.

Let’s assume they just mean that the buses show how the power sector could be run. The main argument is that when such assets are controlled privately, they are optimised for profit, but when they are controlled by the state they “align price with social and economic need”. This means that in “essential” sectors, public companies will always invest more productively than private ones. Well, that does happen sometimes. But at other times, state-owned companies are a complete disaster. How do you avoid the many duds?

To the extent that the report provides an answer, it’s to suggest that public corporations should be “insulated” from “Treasury pressure” and “ministerial direction” — but that they will be well run if they are accountable to “communities” and have “workers on boards”. These are ideas the managers of genuinely well-run public corporations, like Korea’s Kepco or the Dubai Electricity and Water Authority, don’t seem to be especially interested in. As for what might go wrong, the words “trade union” oddly make no appearance. Neither, in the treatment of energy costs, does “net zero” get a look-in.

Writing for The Telegraph, Tom Tugendhat highlights the dangerous utopianism of Ed Miliband’s Net Zero ideology.

This socialist vision of utopia exists nowhere. Norway taps the gas fields we share and sells us the energy, and China builds new coal-fired power plants to help make the steel we’ve effectively forbidden to reduce carbon outputs.

Our real emissions have barely moved, they’ve just moved abroad. Poor Ed, he missed the economics lesson that, while taxes are territorial, carbon is global; so we’re paying with our jobs for higher carbon outputs from dirtier industries with lower employment standards overseas. I’m not sure he’s thought this through.Ed is still singing the Internationale, but all we can hear is Stalin’s “socialism in one country”. And it will fail again. You can’t separate economics from physics in just one country.

It is virtue by vice, squeezing the hope out of the economy with a policy based on all sacrifice and no salvation. The deeper tragedy is that he seems to believe the cold is good for us. Wear the hair shirt, he promises, and your sins are forgiven.

But now is our moment of greatest danger. With Sir Keir Starmer gone, Our Andy, the newly elected Mr Burnham, may offer Miliband an even plummer job as the price of his backing. Burnham may think it’s a price worth paying, but we can’t afford it.

Burnham is reported to have cooled on Miliband as a potential chancellor. Let’s hope that’s right. Otherwise, the man who froze our energy policy in the death zone would do the same to the whole economy. We can reverse the energy austerity with abundance, but we’d be left cleaning up Ed’s fiscal incontinence for generations. If Miliband became chancellor, we would all pay and our children would be left with the mess.

In The Telegraph, Fred de Fossard examines how harsh EU tech regulations should make Britons wary of arguments to rejoin the bloc.

While Europe tries to find ways to wean itself off its reliance on US tech giants, it should ask itself a few questions. First: what services do tech companies offer which European citizens enjoy using, and should they be prevented from doing so? For example, EU digital regulations have reduced the integration of services such as Google Maps and Google Flights creating a less seamless experience for many users.

Second: why are investors and entrepreneurs wary about building their own tech companies in Europe and wrestling with EU regulations? The EU’s economic model is failing. Mario Draghi, former European Central Bank president wrote a damning report on the EU’s economic competitiveness in 2024, warning that regulatory burdens were contributing to the relocation of businesses away from Europe. To date, the EU has done little to change course.

Third, in a world where concerns about political censorship have become a major point of diplomatic tension, with the US showing a renewed emphasis on defending values such as freedom of expression in allied countries not seen since the Cold War, is the online suppression of contentious or controversial speech worth the political risk?

These questions cut to the heart of the issue: consumer welfare, economic competitiveness and civilisational vitality. This should be a warning to anyone in Britain about the reality of the EU in 2026. One hopes the bloc might wake itself from its regulatory slumber and embrace innovation, free speech and the rule of law, but that seems a long way off.

In Conservative Home, Lee Rotherham argues that current estimates for shortfalls in defence spending are likely to be extremely conservative.

£70.3 billion is not the figure that’s needed to properly overmatch the adversary and have a good chance of winning the conflict from the off. Nor does it address enduring issues around long term procurement which will have to wait for another paper; nor obviously cover decision-making processes within Whitehall comitology which merely push problems round in circles; nor consider any of the optionals beyond the critical shortfalls that still add real value. I do make a couple of exceptions relating to defence diplomacy and strategic influencing that can help plug some gaps immediately while the ordered kit comes online. But overwhelmingly this is not a fancy Christmas wish list but rather a desert survival packing list.

In our paper we consider the five great and terrible scenarios of our times: Homeland Defence; East of Suez; South of Suez, the Russian threat; and the China menace. The relative importance of these areas for the nation today, and the role the UK would play as these scenarios develop, can and does need to be a matter of political and considerably wider social debate. Acknowledging them to be interconnected does though allow us to tease out which assets are already overcommitted. As the Defence Select Committee has itself noted, in a conflict a given platform can only be in one place at one time, even when it is multi-roled across just the single theatre as opposed to five.

From missile defence and deterrence to plugging the surface fleet shortfall; from cyber defence to Field Army having some actual field artillery to support it; from minesweepers to regenerating a functional expeditionary capability; these are the astonishing gaps that we now need to fill. The details in the paper are for budget managers and strategic analysts to argue over. What’s needed immediately though is the admission that the £28 billion assessed shortfall that got leaked by an MoD insider is only the politest of British understatements in terms of where we need to be at. Because right now we are in a world where General Sanders, the former Chief of the General Staff, as recently as last year said the UK needed to accept that war with Putin by 2030 was a “realistic possibility”.

That, in official MoD parlance, puts war with Russia in the 40-50 per cent probability range. Perhaps more people in charge of budgets should be aware of the stakes now in play.

Robert Jenrick writes for The Telegraph about the prospect of the next Chancellor of the Exchequer being even more radical than Rachel Reeves.

For whatever Reeves was, her successor is likely to be worse. In a sense, I’m not as worried about who Andy Burnham appoints to replace her. Though I confess I would relish the prospect of shadowing Ed Miliband. The (yet further) damage which I expect is about to be inflicted upon us is a consequence not of personality, but psephology.

The next chancellor will be whoever Burnham needs to hold his coalition together, and that coalition means satisfying his Labour members and the band of Green campaigners to their Left. It all points one way: tax more, spend more, borrow more.

Reeves at least pretended to believe in fiscal rules. Burnham recently admitted he didn’t even know what they are and his allies are demanding he loosens them once again. It would be an extraordinary gamble.

We already carry the highest borrowing costs in the G7 and the heaviest tax burden since the war. There is no headroom left that Reeves has not already spent. Reeves might have laden the camel, but Burnham is gambling on piling on more.

To my mind, a decision that big requires a new mandate, only possible by calling a general election.

Burnham will be risking it all without a mandate, and will be implementing a programme that no manifesto contained. In truth, I’m surprised that Reform is the only party calling for the public to get a say on this with a general election.

Because the decision to borrow and tax even more will make the next chancellor far more consequential than Reeves.

In The Critic, Ben Sixsmith looks into why Keir Starmer’s popularity plummeted so dramatically from the point at which he was elected.

Starmer believed in the system. He also believed in the people who had been favoured by the system. It should have been obvious to all sentient observers that giving Peter Mandelson a significant position would be catastrophic. His deep connections to Jeffrey Epstein were hardly the stuff of obscure conspiratorialism. They had been reported on by the Guardian. But while outsiders, like Jeremy Corbyn, could be shanked in the back, Peter Mandelson was the consummate establishmentarian. What could go wrong?

Starmer seemed to have no opinions of his own when it came to moral and epistemic issues. Britain was becoming an “island of strangers” until it abruptly wasn’t. Women could have penises until they suddenly couldn’t. Freedom of movement was going to return until it definitely wasn’t. A man can change his mind, of course, but Starmer never explained how he had changed his mind. He barely seemed to have a mind.

We can’t avoid a vibes-based discussion here because the fact is that Starmer’s vibes have been historically bad. He seems stiff and humourless — the sort of man who says that his guilty pleasure (his guilty pleasure) is a pint with friends — but there is a broader issue here. In an era where Britain should have been trying to avoid a fate of managed decline, Starmer seemed like a man who actively embraced it. So, he did odd things like trying to pay Mauritius to accept the Chagos Islands. But he also had the grim and awkward manner of someone brought in to manage a once great football team that, having been relegated from the Premiership, was now structurally destined to collapse through the leagues. Britain, to him, seemed to be Leicester City with an army — barely — attached.

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Wonky Thinking

A new report written by Dr. Gerard Lyons for the Centre for Policy Studies looks into Britain’s economic performance relative to Europe. According to the report, where Britain’s performance looks weaker is largely due to domestic policies rather than a result of being outside of the bloc, and that moving closer to the EU would serve to hinder rather than enhance Britain’s economic performance.

Our economic problems are certainly legion: an investment shortfall, expensive energy, a planning system that vastly inflates the cost of building homes and infrastructure, an inability to curb inflation that has fed a cost-of-living crisis and an ill-conceived desire to tackle rising prices through intervention in supermarkets and elsewhere, poorly structured and burdensome taxes, a broken immigration system, retrograde public sector productivity, regional imbalances, high and deteriorating rates of economic inactivity and a poor debt position with out-of-control public spending. There are also structural headwinds such as our ageing population and low fertility rates. Since incentives are fundamental to economic growth, it is concerning that many are now badly misaligned.

Yet many of these challenges, like low investment, predated our entry into the EU. Most were not addressed while we were members. And solving them now requires an economic vision, clear strategy and policy actions from Westminster and Whitehall that would take us in a different direction (of the kind outlined in my 2025 CPS paper ‘Breaking the Cycle’).

Of course, the UK needs a sensible working relationship with the EU, just as it does with other major economies or regions. But that should not mean a reset that ties Britain’s hands on domestic policy such as regulation. Nor should cooperation be one-sided. The UK has allowed EU citizens to use eGates at its airports, yet access for British citizens has been partial and uneven. That may reflect weak UK negotiation, but it also points to a deeper problem: the EU has too often treated partnership with Britain as something to be rationed, not reciprocated.

Indeed, we have recently seen how Brexit freedoms can be taken advantage of, though it was not acknowledged as such. In response to cost-of-living pressures, the Chancellor recently decided to cut tariffs on food imports, a welcome move that the CPS has previously called for. This is just one reminder of the policy scope available outside of the EU, which was always one of the key arguments for Brexit.

Pursuing closer regulatory alignment with the EU now would threaten the areas of future economic growth where the UK is now well placed and where we have seen successes that would not have been possible inside the EU, including but not limited to AI and the City.

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Podcast of the Week

On Triggernometry, Ed Husain discusses the origins of Islamism in the West and how the Muslim Brotherhood promotes such ideas and modes of operating.

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Quick Links

For the third day in a row, the hottest June temperature in Britain has been recorded.

Simon Case calls for Burnham to hold an early General Election.

100% tariff threatened by US over new EU technology tax.

Defence Investment Plan sees £1bn boost from Keir Starmer.

Shabana Mahmood to introduce Ukrainian-style refugee sponsorship scheme.

Iran strikes by US resume after cargo ship attack.

Perusing a second hand book shop, I came across a small bright yellow book. Full Text of the Rome Treaty and an ABC of The Common Market (pictured below) by Paul Minet: journalist, bookseller and Liberal Party activist.

The book is interesting because whilst much of the discussion around Britain joining the European Economic Community (the Common Market) focuses on the early 1970s, this book was published in October 1961. This publication aimed to support Britain’s first negotiation, under Prime Minister Harold Macmillan, to join the Common Market.

The early 1960s are a strange time economically and socially, because unlike the unrelenting gloom of the next decade, this was in the midst of the economic ‘stop and go’ that led to periodic waves of optimism and pessimism. Britain in the 1970s was forced to join the EEC because it seemed like it had no alternative, but in 1961 there was still an argument to be had about the future.

The late 1950s had seen the government kick off an economic boom through an expansionist budget under Chancellor David Heathcoat-Amory, strongly urged by Harold Macmillan, to win the 1959 election. Tax cuts and generous investment allowances saw the economy grow by 13% between 1958 and 1961, with real GDP per capita growth peaking hitting 5.5% for the year in 1960. Annual capital investment increased by 30% and house income was nearly double what it had been in 1950. However, despite the historically impressive rates of growth, the fifties had been a disappointing decade where Britain felt the double punch of obvious overwhelming American superiority and the catch up of European powers. Something had to be done. Minet was well connected journalist and bibliophile, who wrote this book to try to make the case for joining the EEC, drawing on the key arguments of the political and economic establishment. In many ways, his book lays out the pattern for the past sixty years of debate.

Politicians today would obviously bite their arm off for economic fundamentals as strong as the ones that Macmillan presided over. Yet, once again a sense of overwhelming American superiority and European catch up growth is creating panic rather than a cold examination of our position.

Minet’s book is fascinating because just like today’s advocates for closer links (or rejoining) the European Union, the decision to look to Brussels is based on avoiding hard choices at home and trusting in the size and scale of the European market to cover up our structural problems.

The political inability to make hard choices comes home repeatedly in his analysis. Discussing what the British economy needed to succeed, Minet is clear “the solution is to trim costs to keep pace with productivity”. This means prioritising investment over consumption (household and public), a focus on exports and avoiding too much capital flight to prioritise the home economy. Reform of the trade unions and managing wage demands were also necessary. This programme “is perhaps the only cure to our present situation, if an internal cure must be found.” The problem is that such a programme “would not attract much support in the country” because it would necessitate short term sacrifices. To avoid this “austerity programme”, as Minet called it, Europe was the only viable way forward. We can see the same arguments being made today for why we need to consider rejoining or developing closer links with the European Union. Easier trade with Europe would increase trade, boosting GDP numbers. We can just ride on the coat tails of the larger market and we’ll be able to avoid structural changes to UK Plc which would likely be unpopular.

The sum of Minet’s argument is simple. In 1961, the growth markets of the future were in Europe. The Commonwealth countries were putting up tariff barriers and switching towards greater domestic manufacturing reducing the opportunities for Britain to export there. If Britain wanted to maintain its industrial and productive base, it needed to get access to the growing European market. The only danger was that European competitors, particularly West Germany, were seen as more productive and efficient than we were. The risk would be that if we joined the EEC, Britain’s manufacturers would get crushed. Minet’s view, like most of the establishment, was that it was worth the risk. Plus Britain needed a “cold douche of competition” anyway. Win-win. The size and depth of European markets has never been in question, then or now, but the real point is whether joining the EEC (or EU) would actually give Britain these benefits and competitive push that it required?

We have the advantage on Minet, because we have experience of what actually happened. The short answer is that it did create growth, but the type of growth was very different to what pro-EEC advocates had hoped for and was fundamentally unsustainable.

The assumption that Minet and the economic establishment were working on was that the British economy would be industrial and broad-based, not only to maintain employment in the nations and the regions but also because the UK would always be a net importer of food and raw materials (including fuel). Industry is the focus of Minet’s analysis, with services getting only a few infrequent mentions. This was not because of ignorance of the earning potential of services. As prominent economists Robert Bacon and Walter Eltis argued in 1976, and was standard for Minet’s time, the “various private-sector service industries make a valuable contribution to the balance of payments, but this has never been sufficient, and it is never likely to be to finance the food and raw materials that Britain must buy from overseas.” The EEC would be a success if it led to a sustained growth in goods exports which could be used to maintain our standard of living. Growth in services was to be encouraged and welcomed, but was not a substitute for a viable industrial strategy.

So what happened? In the years 1948 to 1973, the UK’s trade exports increased by around 6% in real terms. In the following twenty five year period, exports increased by only 2.6% in real terms. In the years leading up to the Brexit referendum and over the past few years since we’ve left, we’ve seen goods exports stagnate. The fact was that joining the EEC did provide the “cold douche of competition”, but we ended up running away from it, rather than embracing it. The robust industrial policies of European competitors, Germany in particular, forced the country into a transition towards a service-based economy to avoid direct competition with Europe, with Britain retreating to its niche strengths in services. The continent would be the industrial heart of Europe, we would be the services superpower. The alternative would have been more investment in infrastructure, supporting foundational industries such as steel and automotives, with relatively less household and public service consumption. All this would have required the country to make some hard choices.

Our reformed service-based economy temporarily benefited from an unreplicable expansion of financial service exports from the mid-1980s to the mid-2000s, a boom that eventually turned to bust and created a huge debt overhang which has crushed the economy ever since. Moreover, as Bacon and Eltis predicted in the 1970s, this service based growth was never enough to pay our way and finance investment. British households and private sector began to borrow heavily from overseas from the early 1980s until the financial crash to pay for our imports. After the crash, the government was forced to prop up the economy and take on huge public sector debts. Subsequent economic shocks, particularly the pandemic, have forced the state to set in again and again. The result has left the British economy financially exposed and, as Mark Carney infamously put it, dependent on the “kindness of strangers”. Ironically, despite the push for Europe in 1960s being fuelled by concern about America’s overwhelming power and Europe’s strengthening industrial base, we are more dependent on American finance and European goods than ever before.

We live in the political consequences of this gamble. The impact of deindustrialisation and hollowing out of communities has created a demand for social and political reform that has shaped every election since 2017. Old political loyalties have been shaken off and voters in these places have decided to embrace whatever political party that has a plausible programme for change, with huge swings in electoral fortunes as a result.

Minet’s book trades heavily on optimism about ‘expansion’ and how being part of the EEC will lead to the Europe coming together in a shared plan to counter American economic dominance. We know from our negotiations with Europe that although there is much talk about cooperation, EU members remain as protective over their domestic industrial base as they ever were, even when it concerns the military defence of the entire continent. Is it really likely that the EU is going to facilitate the rebalancing of the British economy when they would be losers in that process? Minet’s naivety can be forgiven, with all the soaring rhetoric of European unity during his day, but that of today’s advocate for rejoining the European Union cannot. We have seen golden words turn to ash too many times.

The question which Minet did not have to answer, but which today’s advocates of Europe must answer, is why would this time be any different? Like Minet, therefore, they must return to rhetoric, or ‘vibes’ as kids say today. The ‘model wars’ between various different pro and anti-Brexit all rather miss the point. What has happened since Brexit is immaterial. The point is what happened before Brexit. Here we are solid ground. It also provides the evidence for why we left the EU in the first place. The economic model of Britain simply was not working. The public could see it, even if the establishment could not.

We return full circle. Britain’s weak exports in goods, dependence on overseas food, raw materials and manufactured products alongside our inability to create decent employment (particularly for the young) across all parts of the country remain our central economic challenges. We can repeat the mistakes of Minet & Co, hoping that a dash for Europe will allow Britain to carry on without hard choices. Or we can finally undertake that difficult conversation with the public, lay out the true state of our weak financial and economic foundations, and ask the public for permission to introduce the policies needed to rebuild our industrial base and sustainable prosperity.

Minet thought that such a conversation could not be had, or if it was had, it would lead to electoral defeat. Perhaps Minet was right then and is right now. Yet the thought remains, isn’t it worth trying to do something different?

Full Text of the Rome Treaty and An ABC of The Common Market by Paul Minet (1961) can be found online or, if you are lucky, in your local second hand bookshop.

Towering Columns

In The Times, Patrick Maguire argues that the people of Makerfield elected Burnham out of a desire for radical change.

All the clichés you have read — historic, seismic, unprecedented, make-or-break, most consequential ever — were really written in vain. The result tells us little we did not already know. Slice and dice it however you like, this was always going to be an overwhelming landslide against politics itself — a rejection of what politics has done, and failed to do, to the post-industrial England of 2026. That frustration, despondency and contempt are felt as keenly by voters of left and right alike.

Burnham understands this. He knows the places and the people of Makerfield. Victory would mean he has successfully reconstructed a winning coalition from the wreckage of Morgan McSweeney’s grand designs for the Labour Party, which collapsed under the weight of their implausible ambitions and Sir Keir Starmer’s cowboy building, like the tower of Fonthill Abbey. Scaling up Burnham’s campaign for export, particularly to sceptical customers in the south, demands an altogether deeper understanding of what voters want from a truly changed Labour.

The pollsters Stan Greenberg and Peter McLeod have spent recent weeks in conversation with progressive voters across the country: in Basingstoke, Bath, Bolton, Bracknell, Bury, Doncaster, Filton & Bradley Stoke, Rother Valley and Scunthorpe. All were considering their options between Labour, the Liberal Democrats or the Greens. These people were the bedrock of Labour’s 2024 coalition and reuniting them is the bare minimum a Burnham premiership must do to ensure the Labour Party can once again become a going concern in electoral politics.

In The Telegraph, Lord Frost examines the issue of establishment hostility towards Englishness and English Identity.

In short, it was possible to be politically British without having to be English. (It is one of the many ironies of this subject that fashionable opinion has now turned 180 degrees, and it is now near-taboo to suggest that recent migrants who acquire British citizenship are not as English as everyone else.)

Out of this uniquely British muddled mess, it was inevitable that an English identity would re-emerge. After all, it already existed. It had just been largely associated with the wider British state and its achievements. But as people started to doubt those, and as the country increasingly thought of itself as the bureaucratic, technocratic “UK”, then the cultural and emotional component had to go somewhere – and it went to Englishness. That is the process we are living through.

Two interesting questions follow from this current reality. The first is whether a resurgent English identity can remain entirely cultural and historical, or must in the end be political, as well. If the Scots and Welsh have an assembly, why can’t the English?

All the efforts to set up regional mayors and vast new administrative areas based on very little historical or geographical logic are at root an attempt to avoid this question. An English assembly governing England, leaving Westminster responsible for foreign affairs, defence, and the currency, would after all reveal the reality: that the “UK” national identity is thin and bureaucratic, not emotional, not historical, not cultural.

Writing for The Telegraph, Joshua Rozenberg highlights how activist jurors are undermining the ancient British system of jury trials.

Witness the scene at Woolwich Crown Court late last year, where Charlotte Head, an activist supporter of Palestine Action, was on trial with others for violent disorder, aggravated burglary and criminal damage after an attack on a factory near Bristol operated by Elbit Systems UK, which the activists claimed supplied weapons to the Israeli military.

More than three centuries after Penn’s appeal to his jury, Head’s defence counsel, a leading human rights barrister named Rajiv Menon, KC, appealed directly to the jurors. After reading out the inscription on the Old Bailey plaque, he told them they could decide the case according to their consciences. The trial ended with no convictions.

But Mr Justice Johnson, the trial judge, regarded this as a clear breach of his instructions to counsel.

“The effect of Mr Menon’s speech was to invite the jury to disregard my directions that they should put views of the Middle East and the war in Gaza, and emotion, to one side,” he said subsequently. It’s not known whether the judge has decided to refer Menon’s remarks to the Attorney General as an alleged contempt of court.

Because the jury could not agree on charges faced by four defendants, the prosecution sought a retrial which ended when they were all convicted of criminal damage. Last Friday, Charlotte Head, 30, and Leona Kamio, 30, received sentences of six years. Fatema Zainab Rajwani, 21, was sentenced to five years and eight months. Samuel Corner, 23, received five years for criminal damage and a further three years and eight months, to be served consecutively, for fracturing the spine of police Sgt Kate Evans with a sledgehammer.

In The Critic, Mike Jones argues that the tipping point against Keir Starmer occurred during the 2024 Southport Riots.

The Russian revolutionary Vladimir Lenin was fond of asking, “Who? Whom?”. It is a question that strips politics back to its essence: who holds power, and who is on the receiving end.

For many in Britain, Southport gave a stark answer: A multicultural elite indifferent to mass immigration stood above the rest — backed by the two-tier authority of the state, with Starmer at the helm. (As protests rage in Belfast over a shocking attempted murder, allegedly perpetrated by a Sudanese asylum seeker, the state faces another major test.)

That narrative did not stay on the comment pages. It quickly spilled into the wider public consciousness. Lord Ashcroft’s focus groups showed how fast the “two-tier” charge took hold among ordinary voters. It offered a simple way to package a wide set of grievances into something neat and intelligible.

Combined with Starmer’s failure to “smash the gangs”, this hardened opinion at remarkable speed. Many feel the country they grew up in is being reshaped without their consent, while a political class seems determined to shut down anyone who says so.

For many voters, the verdict is already in. The Prime Minister does not represent them; he resents them.

In Conservative Home, Georgiana Bristol makes the case that advocacy for the oil and gas sector won the Conservatives Aberdeen South.

To fix this, and keep good jobs in Aberdeen, our report called on the Government to grant new licences for North Sea oil exploration, scrap the EPL immediately, and develop a concrete transition plan that supports domestic oil and gas production for as long as it takes for renewables to be genuinely ready to replace it.

As Shadow Energy Secretary, Claire Coutinho has forcefully made this case. Wes Streeting has pledged to grant new licences in the North Sea if he becomes Prime Minister, and Andy Burnham has said that he has an “open mind” on further exploration.

It’s correct that drilling more in the North Sea won’t have a material impact on prices paid by UK consumers. But ensuring continued investment will make sure that jobs and tax revenue stay in the UK – rather than Nigeria – and will help keep the energy supply chain afloat as we continue to move towards renewables.

Whilst the impact of energy policy is felt more keenly on the ground in Aberdeen than anywhere else, there are lessons that the Conservatives can take from this. A relentless focus on good jobs. Safeguarding domestic industry. And, in the words of Al Carns, “energy security shapes economic security”.

In The Telegraph, Stephen Pound argues that unions are advocating for higher immigration - against the interests of their members.

I also found in my decades as a Member of Parliament that those who made it to my advice surgery were never the tragic mothers of Afghanistan but more often the sons of businessmen and farmers who could pay the “agent” to facilitate the journey for what was rather more an economic imperative than a desperate longing for life and freedom.

No one with an ounce of humanity could deny the suffering of those who make an illegal and dangerous journey to these shores.

No one with an ounce of sense could deny that uncontrolled, unlimited immigration may provide a temporary relief to the individual rescued from the Channel but ultimately is corrosive of society and does no favours to those who the idealists seek to support.

Many of us in Britain still squirm with guilt when we remember the then health secretary, Enoch Powell, scouring the Caribbean for volunteers to work in the NHS or those mill owners in Yorkshire and Lancashire luring as many workers as possible from Mirpur to sweat in conditions that undercut the native workforce. Again, a short-term solution led to a long-term crisis and we see the current problem through the lens of that guilt.

We simply cannot, however, allow the error of the past to dictate the policy of the present and I sincerely, and in true fraternal spirit, invite Andrea Egan to spend some time away from the echo chamber and see what is being said and experienced on the streets.

The experience may not be a pleasant one. But it is one that may help to ensure that the trade union movement remains a bastion of support for working people and not a self-satisfied and increasingly out of touch relic in a world that has changed beyond recognition.

In The Telegraph, James Frayne argues that unprecedented levels of immigration shattered the vision that Leave voters had for Britain.

Looking at the reasons voters decided to vote Leave, it’s not hard to see why. Among respondents who backed Brexit in 2016, the top three issues they had in mind when they cast their vote were border control (51 per cent), having control over our laws (43 per cent) and the cost of living (31 per cent).

Overall, taking account of the state of the economy and society, 63 per cent of voters think Britain is on the wrong track, compared to 23 per cent who think we’re on the right track. Among Leavers, the share of people who think Britain is on the wrong track rises to 72 per cent.

It’s important to note that most voters blame other things for our current predicament rather than Brexit, even if many believe there has been a failure to take advantage of the opportunities afforded by the UK’s exit from the EU. Most people blame poor political leadership, as well as a turbulent economic and social backdrop and no border control.

Given a choice of two options about the problems facing Britain today, significantly more people agree that they’ve been caused by issues other than leaving the EU.

And, given a short list of possible solutions to deal with our problems, significantly more people say we should have a fresh general election to choose a new government (37 per cent) than advocate rejoining the EU (26 per cent).

The logic is clear – voters can see that recent prime ministers have made a whole series of unforced errors. It isn’t down to Brexit that Starmer piled additional new costs on to businesses, or chose to pay for more welfare claimants, or that his Conservative predecessors chose to house large numbers of asylum seekers in hotels in small towns. These mistakes were all their own.

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Wonky Thinking

The Prosperity Institute has published a new report calling for the replacement of the Equality Act with new legislation which focuses on the negative enforcement of human rights, removing the positive rights framework that currently exists under the Equality Act. It recommends abolishing the Equality and Human Rights Commission as well.

The idea of bringing together various laws on equality to create a single piece of legislation, was first mooted in 1997—the year New Labour came to power—in the course of a project led by two politically influential figures: Bob Hepple and Lord Lester.

Hepple had been a member of the African National Congress in apartheid South Africa before moving to the UK in the early 1960s. He became a QC and a Cambridge academic, specialising in labour and equality law. He also established the Campaign Against Racial Discrimination (CARD) in 1964 and was chair of its legal subcommittee. In 1997 he was a member of the Runnymede Trust’s Commission for Multi-Ethnic Britain.

Lord Lester was a member of the Labour Party who, as a young human rights lawyer, had helped to draft the 1965 Race Relations Act. A prominent member of CARD, he co-founded the Runnymede Trust in 1968 and was its chairman between 1991-1993. By 1997 Hepple, then Master of Clare College at Cambridge University, and Lord Lester had convened a small group of people from organisations involved in law and race relations, including the Runnymede Trust and JUSTICE, a law reform charity. Their aim was

to review and evaluate proposals for the reform of UK anti-discrimination legislation, based on an assessment of the experiences of those affected by the legislation. The specific objectives were to develop a legislative framework, to propose other measures that will promote equal opportunity policies and to spur compliance with those policies, and to ensure that the UK is in full compliance with its obligations under EU law and international human rights law.[4]

The framework they arrived at in 2008, set out in the Declaration of Principles on Equality by the Equal Rights Trust (ERT) (of which Hepple and Lord Lester were Chairs), differed from previous anti-discrimination legislation in two important respects:

1. It embodied a shift from negative conceptions of law, in which law is an instrument for the prevention and punishment of that which is expressly forbidden, to a positive idea of law in which law itself is seen as the agent by which society will be reformed.

2. It reversed the order of priority in the chain of legislative accountability: instead of being ultimately answerable to the British electorate at the ballot box, equalities legislation was to be addressed primarily to trans-national officials such as the law officers of the European Union and related bodies, and the United Nations.[5]

Accordingly, of the 128 original signatories supporting the Declaration, only 26 were based in the UK; and of the 26, only one was not an academic and/or legal professional working in human rights or equalities law. This was the exclusive social stratum which gave birth to the Declaration, the document which proved to be the dominant influence on the subsequent Equality Act.

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On Quite Right!, Simon Heffer, Madeleine Grant, and Michael Gove examine the complicated legacy of Enoch Powell and how his actions and rhetoric still influence the British Centre-Right today.

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Train collision between Bedford and Luton causes dozens of casualties.

Lord Falconer calls for Keir Starmer to step down as Prime Minister.

Government attempting to force Dartmoor farmers off land, claim farmers.

Moscow oil refinery hit during Ukrainian drone attack.

Towering Columns

In The Telegraph, Nick Timothy says that the public sector equality duty has undermined our legal tradition and protected the wrong people.

How can it be that an Islamist double murderer can successfully sue the British state under our own laws, costing us more than £200,000? How can unequal treatment based on race or identity be official policy within the Civil Service, education and the NHS? And how can it be that guidelines for police appear to have led officers to handcuff Henry Nowak as he lay dying, prioritising instead his killer’s baseless cry of racism?

The behaviour of the police at the scene of Henry’s death is to be investigated. But – as my party’s leader, Kemi Badenoch, rightly said – they were following the guidance and training they had been given. This is not an excuse, but it is a wake-up call: the politics of race and identity are now hardwired into our public institutions, our public services and our laws. One of the main culprits is the public sector equality duty (PSED), which the Conservatives are now committing to abolish…

The Duty has become a weapon even for convicted terrorists and those engaging in radicalisation of other criminals. It is used against those who guard them, and inhibits the ability of the state to incarcerate dangerous people safely and securely. When our laws allow those who hate our way of life to deploy those same laws against us, they are no longer fit for purpose. And they distort our ancient common law tradition of treating everyone as an individual, equal in rights and responsibilities.

For The Critic, Susan Pickard documents how despite the Supreme Court ruling on gender equality our public institutions are still resisting change.

And that is precisely where we are now: not in a world where the ruling is openly rejected, but in one where its implementation is endlessly softened and deferred, challenged both on technicalities and general principles and suspended accordingly in a kind of institutional ambiguity. Outright resistance is already visible. The President of the National Union of Students has called on Parliament to reject the draft guidance in defence of “trans equality”, while the President of the UCU has described the moment as “significant and unsettling… for trans people everywhere.” Across universities, legal academics continue to publish critiques arguing that the ruling is conceptually incoherent, legally unworkable, or socially unjust with a few, isolated voices arguing in favour, such as Dr Michael Foran, who himself was subjected to bullying on account of his position.

A year on, the everyday culture within universities tells its own story. Pronouns remain recommended on institutional emails. University conferences continue to define “women” in ways that encompass trans women. Colleagues who might object keep their heads down. Looking back, my excitement and relief was misplaced. The Supreme Court ruling clarified the law. What it did not, and could not, settle was whether institutions built for more than a decade around gender identity ideology are willing to accept the implications of that clarification.

Of my three academic colleagues who openly challenged aspects of this orthodoxy, one has since taken voluntary severance, and the other two have decided to keep their views private for professional reasons. I remain where I was: still arguing, still formally protected by the language of academic freedom, and still aware that institutional hostility has not disappeared but has merely become more careful. My American friends still think it’s all over. But within British universities, at least, it has become clear that the real struggle has only just begun.

In Conservative Home, Daniel Pitt argues that multiculturalism has not led to peaceful pluralism but national division.

Cicero, the great Roman statesman, argued that “the good of the people is the chief law.” Multiculturalism has not been for the good of the people in our country, nor has social justice. They have had a corrosive effect on our cultural identity, our national pride, and our understanding of justice. Structural multiculturalism has worn away trust within our community and has cut deeply into the roots of public order.

Rather than going to the heart of our problems, defenders of multiculturalism and social justice have sought to increase government intervention in our lives and have sought more bureaucracy to surmount communal antagonism. This has only made things worse. The alternative to a common unifying culture is not the nice and tolerant pluralism that multiculturalists once imagined but ever more intrusive policing of relations between hostile communities. We cannot let this continue any longer.

Multiculturalism and social justice have harmed justice in the country, not enhanced it. Aristotle, the ancient Greek philosopher, taught us in his Nicomachean Ethics that we “refrain from evil” because we fear punishment, but too many people in our country do not fear punishment from the law at all, and far too many of our law-abiding neighbours and friends certainly do fear the evil that criminals get up to.

A fundamental principle of the rule of law is that everyone is bound by it. However, our left-liberal elite has rejected this principle in favour of social justice and structural multiculturalism, and therefore, they treat ethnic minorities differently. The Sentencing Council provided us with a real-life case stating explicitly that the courts should consider “protected characteristics” in their sentencing. This meant that ethnic minorities would receive a lesser sentence than a white man for the same crime. This, of course, strikes at the heart of the rule of law, and we should not stand for it.

On Substack, Andrew O’Brien argues that Westminster is obsessed by ‘storytelling’ as a way to avoid confronting the crushing reality of national decline.

In many conversations in Westminster you will hear people talk about storytelling in a way that essentially tries to change reality. The inference is that if we told a better story or a different story about the country, it would alter the nature of the decisions that we have to make. We can shift from ‘negative’ narratives about financial crisis and spending cuts to ‘positive’ narratives about reform and change.

Storytelling is the last refuge for a generation of politicians that grew up in a world where the economic settlement was accepted and considered to be working, and where politicians could pick and choose their battlegrounds (Europe, immigration, social mobility etc.). When you hear a politician talking about storytelling, it is simply a plea for agency, a hope that we can deflect from the mess we are in.

The truth is that politicians not longer have control over the story. There is a national story and the debate is really about who can communicate it clearly and write a conclusion to it that ends this chapter of our national life on a good note.

The story is a simple one. Our country has gone from being the epicentre of the global economy, first as producer, then as banker, then as consumer to being on the periphery, dependent on borrowing, prone to shocks and without influence. It has been caused by inevitable global forces, bad policy choices, an insular political and economic elite and increasingly squeezed by rising great power conflicts that are making it poorer, weaker and divided. The psychological blow is crushing the national spirit. The financial blow is fuelling the cost of living crisis. The political fallout is creating instability and division. This is the only story that can be told.

For The Telegraph, Michael Deacon writes about the violence in Belfast and how politicians are ultimately to blame for the riots on our streets.

I fear, however, that they will once again merely resort to lecturing us about the dangers of “division”, and spend more time talking about the rioting than about the atrocity which triggered it. Anything but confront, or even acknowledge, the real source of the problem. They have a longstanding habit of this. Let’s not forget that after Sir David Amess, the Conservative MP for Southend West, was murdered in 2021, many of his colleagues in Parliament responded by calling for a clampdown on social media abuse. Sir David’s murder had nothing to do with offensive tweets – he was stabbed to death by an Islamist. Yet it was social media they talked about. So don’t be surprised if MPs decide that this week’s rioting was caused by social media, as well.

In fact, they really might. After all, social media is where footage of the knife attack first spread. “But for that,” MPs may think, “it would have been so much easier to contain the public’s anger.” For all our sakes, though, they urgently need to realise that while setting fire to buses may not be justified, the public’s anger is. We’re sick of having to live like this. We don’t want to live in a country where binmen are slashed to death while walking the dog.

We don’t want to live in a country where hotel workers are slaughtered with screwdrivers. And we don’t want to live in a country where innocent pedestrians run the risk of being beheaded in the street. Britain has quite enough problems as it is, without importing more of them. So, from now on, we would like our Government to put our safety first. This, therefore, should be our message to the nation’s political elite: “Take a piece of your own advice – and respect our wishes.”

For The Spectator, Gareth Roberts says that social media regulation is not about keeping the public safe but shutting people up.

Politicians would dearly love to shut people up; as we have seen in the last couple of weeks, in particular, what I call gammon management – the fear that low-status whites may notice the effect of progressive policies and get angry – is one of their major concerns. I’m reminded of how Napoleon’s control of information was so total that some French people only found out about the battle of Trafalgar ten years after the event. How Keir Starmer must wish for the same level of control over information. He, and his brethren, would love to muzzle their political opponents.

We have seen how politicians concealed the Afghan resettlement scheme. And today, the Daily Telegraph exposed a suppressed report which said that £28 billion pounds of public money – yes, you read that right – was siphoned to terrorists, hostile states and gangsters between 2015-21. Politicians didn’t think the public had a need to know such things. This is their instinct, and introducing digital ID by the back door, via concern about children, hands them even greater power to control what we know.

I could well be accused of cynicism here. But I don’t think it’s unreasonable to be suspicious of the government’s motives. If there had been a holistic approach to child protection, I might give them the benefit of the doubt. But you will note that nobody was mooting these bans when Twitter, or X, was run by their ‘side’; when it was equally – perhaps more – full of unpleasantness; and when it was throwing people off for having the temerity to say that men are not women. But people are being terribly rude to Chris Bryant now, you see, so it’s suddenly become urgent.

Likewise, there is the ‘division’ Labour keep fretting about. Actually, they don’t mean racial division at all, as Labour has done more to whip that up than Nigel Farage could manage, even if he wished to. ‘Division’ actually means noticing what politicians are up to. As for protecting kids from paedophiles, Labour turned a blind eye to the abuse of countless little girls by the Pakistani rape gangs. You will forgive me if I scoff at their current hand-wringing, given this record.

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Wonky Thinking

On his Substack, Rian Whitton describes the recent sudden decline in our automotive industry and outlines the factors that are leading us to “Carmageddon” with many businesses on the verge of closing factories and cutting jobs. This decline has been caused by the underutilisation of plant, Chinese overproduction and misguided Zero Emission Vehicle regulations.

So how might this collapse start? There are three potential areas of weakness. The car factories themselves, the wider supply chain, or the much-vaunted battery plants. If these are closed down, delayed further or cancelled, they could create a chain reaction whereby they take a large number of businesses with them. Since there are only a handful of automotive clusters in the UK, mass closures at one cluster could spill over into others very quickly.

The best bet may be in Oxfordshire, where the BMW-owned Oxford Mini plant still operates, producing over 100,000 ICE Minis per year. UK-based Mini EV production was supposed to come to Oxford in 2026, but that was put on hold in early 2025. BMW even refused a £60 million government grant to keep the project on track. Meanwhile, in China, they have entered into a joint venture with local firm Great Wall Motor to produce Mini EVs there. Additional Mini EVs are being produced in Leipzig, Saxony. These potential imports face no tariffs and benefit fully from the UK’s electric car grant for consumers.

So Mini EVs produced in China are undercutting the non-existent Mini EV offering in Britain. It begs the question, why would anyone bother to make Minis here?

It is hard not to see the paused decision in 2025 as the first step towards closure, with BMW executives pondering this very decision as we speak. One thing to keep in mind is that while companies, of course, want to make all their plants profitable, when the prospect of closures arises, one plant management team in one country will ruthlessly lobby against a counterpart in another jurisdiction. If the choice comes between the Leipzig plant and the Oxford plant, we can expect only one winner.

This would be a disaster of epic proportions, given the Mini is the second most produced UK vehicle and export model. Immediately, about 1/7th of the total production would be gone, creating cascading effects across suppliers up and down the country.

But this is just one area of potential weakness. A plant closure could just as easily be decided by the fall of a major local supplier. An anonymous source relayed to me that a major international car manufacturer with a British plant is buying components from local UK suppliers for its car production in Eastern Europe, despite the local European industrial base being perfectly adequate to supply itself. They are doing this because if the relevant UK suppliers didn’t have the foreign business, they would collapse, therefore imperilling the company’s own UK assembly line.

The last major threat is that battery plants essential to a transition to electric vehicles do not materialise in sufficient capacity or are cancelled. In October, I mentioned that the UK had very little battery-producing capacity. In 2012, the company AESC built a Sunderland plant, with 1.9 GWh of annual battery capacity. Since then, in late 2025, AESC opened another production line at the plant with 15.8 GWh in capacity. The new capacity gives Nissan a roadmap to scale up BEV production, even if it is likely to lose money on these models.

The next expected gigafactory is the Agratas plant in Somerset. With an expected capacity of up to 40 GWh, it will primarily supply JLR’s electric vehicle range. Originally scheduled for 2025, the Agratas plant has suffered multiple delays and is now projected to begin production by the end of 2027. To keep the project going, it needed £380 million in grants from the UK government in April 2026. Part of the reason for the delay has been JLR delaying the rollout of its EV range in order for demand to pick up.

In 2025, Tata, the owner of Agratas, sold a 12% stake in the company to AESC, the current UK gigafactory operator in Sunderland. AESC is itself headquartered in Japan but is owned by China’s Envision Group. China therefore now has an enormous stake in the battery plant infrastructure in Britain, leading to concerns about diversification.

There is still plenty of opportunity for the Agratas project to go belly up, but even if it gets built, this and the AESC plant in Sunderland do not get Britain the battery-manufacturing capacity necessary to produce over 1 million BEVs a year. Of course, Britain could import the batteries, as they would be cheaper. But then we would lose much of the product’s value, likely reducing the industry’s long-term gross value added. Without new commitments, imports rising, and the ZEV tightening, company executives could easily decide the UK is just not the place to build cars anymore.

The government tacitly accepts that there is a major risk of an industry collapse. It has provided a funding scheme called Drive35, which will distribute £2.5 billion in grants, loans and R&D support up to 2035 in order to provide ballast to the largest clusters. While very welcome, this will not offset a major downturn.

Following a flurry of reports on the ten year anniversary of the Brexit vote, on Substack Warwick Lightfoot analyses the latest data on whether Brexit has damaged the economy. Overall, he finds that leaving the EU has not made a substantive difference to the country’s economic performance because we are more heavily weighted towards services than the rest of the trade bloc combined with the poor performance of the EU on science and technology has undermined its potential growth prospects compared to the US.

An important explanation of the difference in economic performance between the EU and USA is America’s advantage in science and technology. The EU has put huge efforts and resources into its science programme. Yet it has been expensive and yielded disappointing results. The 2024 Draghi report recognised that ‘the EU has an important programme for R&I – Horizon Europe – with a budget of close to EUR 100 billion. But it is spread across too many fields and access is excessively complex and bureaucratic. It is also insufficiently focused on disruptive innovation. The EU’s key instrument to support radically new technologies at low readiness levels – the European Innovation Council’s (EIC) Pathfinder instrument – has a budget of EUR 256 million for 2024…It is also mostly led by EU officials rather than top scientists and innovation experts’.

The Brexit decision has made little difference to the overall performance of the UK economy, given the fact that the Single Market does not cover services that account for over 80 per cent of UK GDP, the UK has a flexible labour market and a flexible exchange rate that adjusts. The Single Market itself has been a disappointment as the work of Andre Sapir over many years explains. The ambitions of the Ceccini report have not been realised. Moreover, the principal policies and institutions of EU economic policy whether it is trade policy, farming, science or vaccines has been defective. Lord King, the former Governor of the Bank of England was probably right in his judgement, that over a fifty year period national accounts data would hardly register a change that reflected membership of the EU in or out. Lord King as Governor was also alert to the difficulty of relying too heavily on differences in reported data and the accuracy of precise national accounts data in establishing strong assertions about causation. It is better to talk in rough terms rather than being precisely misdirected.

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Podcast of the Week

On Generative Futures, David Edgerton speaks with Phil Bell about how we think about the rise of Artificial Intelligence, the misguided historical analogies and how businesses are using a lack of knowledge about previous technological transitions to create positive PR around the development of AI.

Generative Futures

David Edgerton on Historical Analogies, Technology, and AI

David Edgerton is Professor of History at Kings College London. His book Shock of the Old challenged the way we think about innovation, arguing that we systematically overvalue the new and ignore the old (including maintenance). He has also written importantly on the British ‘warfare state’ and his book…

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a month ago · 6 likes · 2 comments · Phil Bell

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The economy contracted 0.1% in April due to the War in Iran.

Labour’s former Armed Forces Minister says that government must look to cut welfare to fund defence.

The government has launched the world’s first AI Economics Institute.

We have the highest residential mortgage debt of any country in Europe.

Ex-FTSE100 business Flutter Entertainment has left the London Stock Exchange for New York.

A full list of potential Prime Minister Andy Burnham’s u-turns so far.

Scotland has received £57.3bn in above national average public investment since 1999, Wales has received £1.3bn less.

Announcement: We are delighted to welcome James Gillham as the Conservative Reader’s newest co-editor. James is the Digital Lead for Build for Britain.

Towering Columns

In The Telegraph, Nick Timothy outlines how equality before the law no longer exists in modern Britain.

The Sentencing Council itself, which sets guidelines for judges, explicitly cites ethnicity as a factor to consider as mitigation when sentencing young offenders. The Judicial College’s Equal Treatment Bench Book – which has a whole chapter on race – says “treating everyone the same does not always ensure true equality”, because people with protected characteristics may be disadvantaged by “neutral” treatment. This kind of identitarianism is risible.

Treating criminals as vulnerable – and treating race, religion, age and mental disability as conveying automatic disadvantage – runs through the logic of the whole system.

But it’s not just in matters concerning the race of the victim or perpetrator where justice and policing are going wrong. The judge in the Fordingbridge rape case, when sentencing the three teenagers concerned, said his responsibility was not to “criminalise” them, and that his priority was their “reintegration into society”, rather than providing justice to victims or protecting the public. These comments sound deranged. But they are straight from official sentencing guidelines.

Now David Lammy wants to make things even worse with a new youth justice white paper, which will set an arbitrary target of cutting the number of under-18s in custody by one fifth regardless of the severity of crimes committed. The paper even suggests treating young adults differently based on their age or identity, as happens in Scotland. Labour’s endless focus on the rights of criminals, and engineering the system to benefit certain identity groups, places offenders first and victims last.

For the National Post, Michael Murphy compares the response to the murder of Henry Nowak with the response to the death of George Floyd.

It should come as no surprise that the attitude of senior officers might trickle down to those making life-and-death decisions on the streets. This is, in fact, merely the system working as intended. Britain’s Police Race Action Plan stipulates that “racial equity” does not mean “treating everyone ‘the same’ or being ‘colour-blind,’ ” and recommends taking a “racialized’ approach to policing. How could officers responding to Nowak’s death, and the Digwas’ lies, not have been affected by these guidelines? That question is, for Hampshire police, a Catch-22: either they conducted themselves in a colour-blind manner, in violation of their guidelines, or they did not, to Nowak’s detriment.

These vexing questions remain unanswered. Into the vacuum, Reform Leader Nigel Farage declared that “white lives matter too,” and called for a response to Nowak’s death of “pure, cold rage.” On Tuesday evening, protesters in Southampton clashed with police, with some demanding they kneel for Nowak, in the manner that many of their colleagues did for George Floyd, who was murdered by police in the United States in 2020.

The same British establishment that promiscuously embraced the hysteria of Black Lives Matter is now calling for calm and condemning Farage for his supposedly inflammatory language. The contrast of that language to that deployed by the state during comparable outrages is likely intentional. After the Manchester Arena bombing, the public was urged not to “look back in anger.” This response became something of a leitmotif for tragedies resulting from political decisions, like unwanted mass migration, that the establishment attempted to place beyond politics, and therefore beyond criticism. Farage’s pointed language is alien to British politics; it marks a new juncture, in which the grievances of the majority have, belatedly, entered the mainstream.

For The Telegraph, Sam Ashworth-Hayes argues Britain’s institutions prioritise racial justice over all else - including preservation of life.

Concerns over Axel Rudakubana were downplayed when a former teacher was accused of stereotyping him as “a black boy with a knife”. Fears of accusations of racism meant that security staff failed to confront the Manchester Arena bomber. In each case, the mechanisms at play in the Nowak case were on partial display.

The rationale which underlies them remains the same, today, as those which gave way to the bout of self-examination in the Macpherson report. Having embarked on a project to utterly remake the country through historically unprecedented levels of migration, Westminster has been playing catch-up in managing the tensions and conflicts that result, constantly attempting to maintain legitimacy with an increasingly divided and untrusting populace.

The way it has chosen to do so is by identifying the risk of majority rejection of minorities (as opposed to the more manageable minority rejection of majority) as the greatest threat it faces, and accordingly by putting the management of these tensions – racism, bigotry, hatred, whichever description you choose – as the greatest priority for policing.

Even the sentencing remarks for the case bear the imprint of this logic, with the judge noting that Digwa had “stirred up racial tension” and “made many Sikhs worried about their own safety”.

Watch the bodycam footage of Henry Nowak’s death – quiet pleas for help ignored as officers went about the business of managing tensions – and you can see what this means in practice. This tragedy was not an aberration. It was the two-tier machine of law-enforcement doing precisely what it was meant to do.

In Conservative Home, Callum Price summarises the events of the debate between Zia Yusuf and Fraser Nelson at the IEA.

The ‘what’ is easy, and identified by Yusuf, Nelson, Frost, and countless others alike. Energy costs through the roof; a planning system that strangles development of infrastructure and housing; a government structure seemingly incapable of getting anything done; a tax burden that suffocates work and investment; a welfare bill through the roof; a criminal justice system on its knees; and questionable border security, to give the understatement of the century.

The ‘how’ is somewhat trickier. But there is low-hanging fruit, particularly on the economy. First, stop doing harm. The state should lift its boot-heel from the throat of businesses and workers alike. We should make it easier, not harder, to hire new employees. We should stop punishing wealth creators, and make work pay more than welfare. There is common ground here for more than one political party to get behind. What’s more, if we can fix the obvious issues in our economy, the benefits will filter out quickly into the overall mood of the nation.

During Monday’s debate, Lord Frost pointed to 2010 as an estimation of when, he believes, things began to feel worse in Britain. Others point to similar periods in time to make a similar point – one meme jokes that the 2012 London Olympics was the Britain’s ‘season finale’, because everything has been downhill since then. Interestingly, this time frame maps quite nicely on to the chart that shows our growth problem. After the financial crash, the UK economy basically stopped growing in any meaningful way.

In UnHerd, David Goodhart outlines why the 2010s political realignment is here to stay despite recent elections globally.

The emerging cross-party consensus (minus some parts of the Left) echoes the priorities I described above. It now includes: a permanent low level of legal immigration, and a goal of zero illegal immigration; ongoing attempts to hack back the regulatory state; acknowledgement that higher education has over-expanded and technical skills have been neglected; the recognition that the triple lock is unaffordable and welfare spending is out of control with too many dropping out of the labour market (only four in 10 households are net contributors); the need for a rethink on Net Zero, a regional rebalancing to the economy, an openness towards some degree of re-industrialisation, more national control over critical assets, and limits to free trade in the coming bloc-based global economy; more investment in innovation, defence, and the application of AI, including by UK pension funds; greater pushback against the progressive activist war on tradition and authority; more concern about polarisation, anomie and loss of meaning, especially among young people, a concern now focused on social media regulation.

This new consensus tilts more towards the Right bloc (Conservative/Reform) than the Left bloc (Labour/Greens/Liberal Democrats); that does not guarantee the Right will prevail. Minus the scepticism about Net Zero and welfarism, plenty of the above could align with the economics of Andy Burnham’s Manchesterism. Nevertheless, in the short term, internal Labour politics, with or without Starmer, is likely to require more old-school, statist, tax-the-rich Leftism (despite the fact that we already have the most progressive tax regime in the developed world).

But is the new consensus postliberal? There are many schools of postliberalism, each defined by their distinct critiques of liberalism. Matt Sleat, in one of several recent books on postliberalism, complains that it is often little more than an immature rage against liberalism. And it is certainly unformed as a distinct ideology by contrast with older rivals like socialism, conservatism or liberalism itself.

In The Telegraph, Andrew Lilico argues that Covid-era lockdowns are partly to blame for record-high youth unemployment.

This has been a trend for decades, but more recent factors have exaggerated it. Covid and its aftermath coincided with, and contributed to, reduced labour market participation by the young and a sharp increase in mental and physical health problems. Prior to Covid, the proportion of Neets was around 11 per cent, compared with 13 per cent today. The youth is now more likely to experience a common mental disorder (CMD) than any other age group, with 22-23 per cent of those aged 17-25 having a probable mental disorder, whereas two decades ago they were the age group least affected.

Mental health challenges have become strongly correlated with worklessness among young people. Among those aged 16-34, those with mental health conditions are 4.7 times more likely to be economically inactive than their peers.

Some of that is surely a by-product of Covid restrictions such as social distancing and lockdown, not necessarily in the direct sense of people developing mental health issues in that period (though that may have happened too), but in the more fundamental sense that the disruption of those years meant young people with common challenges never developed the habits and life patterns that allowed previous generations to learn to cope.

Having missed critical life windows for that development, it’s now very hard for them to escape. This was of course predicted at the time of these restrictions, but the interests of the young were not understood or weighted highly by policy in that period.

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Wonky Thinking

A new report by Cambridge Circus Research analyses the complex NGO-charity structures that hold huge swathes of influence over our public life. It finds that some charities have been using their money for overtly political purposes, while many are funded by foreign entities such as Iran.

For a political party seeking to govern amid this landscape, the practical risk is posed not by a single hostile organisation, but by a network of actors singularly committed to frustrating their agenda. Major foundations fund intermediaries; intermediaries funnel to frontline organisations; legal charities and advice bodies identify claimants and evidence; campaign organisations supply oppositional narratives; media outlets present campaign representatives as neutral experts; and the same bodies appear in formal consultations and parliamentary evidence. Immigration and asylum provide the clearest examples, including the Conservative government’s Rwanda scheme and Labour’s UK-France “one in, one out” arrangement.

The central institutional problem is democratic displacement. Governments may possess a mandate for an agenda, but implementation can be slowed, reframed, or effectively vetoed by networks that are legally sophisticated, professionally funded, and only partially transparent. The policy response should therefore focus on increased transparency, stricter definitions within charity law, and better preparation ahead of policy delivery.

1. Charity law permits policy campaigning where it furthers charitable purposes, but the boundary between charitable advocacy and political purpose is too permissive and too weakly enforced in practice [S1].

2. The infrastructure is layered: large foundations and public bodies fund intermediaries, intermediaries fund or support campaign groups, campaign groups generate evidence and media pressure, and legal charities or public-law firms translate policy opposition into litigation.

3. Immigration and asylum are the clearest policy fields in which this system operates, but the model also appears in climate policy, protest law, equality policy, procurement, citizenship, legal aid, and public administration.

4. There are also national security implications – weak oversight has allowed networks of charities funded, directed, or acting on behalf of hostile state actors including Iran. Some of these charities propagate proscribed group propaganda and advance antisemitic and Holocaust-denying rhetoric.

5. Public funding can create a “state-funded opposition loop”, in which departments, local authorities, or arm’s-length public bodies finance organisations that later campaign, litigate, or give evidence against the state in the same policy field.

6. Consultation responses, select-committee evidence, and broadcast appearances can give organised advocacy networks the appearance of neutral expertise or broad civil-society consensus.

7. The Charity Commission is responsible for over 170,000 registered charities but possesses only 457 employees, including the board. This is insufficient to pursue meaningful enforcement of 7 Breaking the Blob charities in breach of charities law. As it stands, the Charity Commission is simply not fit for purpose.

8. The data on grants is highly fragmented and incomplete. Many of the numbers disclosed in this report must be treated as lower bounds. Transparency would be greatly improved if an auditable centralised data repository were available to cross-reference grants to charities and track funding flows.

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Podcast of the Week

In The Critic Show, Chris Bayliss, Henry Hill, and Reverend Marcus Walker discuss the intergenerational responsibility that politicians hold, and how they are currently failing to govern with the interests of future generations in mind.

OUTPOST

The Generation Delusion (Full episode)

This week on The Critic Show, Henry Hill and Chris Bayliss are joined by the Reverend Marcus Walker to discuss the erosion of intergenerational responsibility. From defence and infrastructure to fiscal policy, the Government just keeps getting it wrong, repeatedly prioritising electoral gain over the health and wealth of the country. The question is whether this trend is a recent development or a post-Cold War shift, and how political incentives, married with fragmented modern ideologies, contribute to a culture that struggles to implement any kind of constructive plan…

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2 months ago · 3 likes · Outpost

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Quick Links

A Saudi national, Almunthir Daqamah, has been charged with attempted murder after shooting a member of staff of his former university with a crossbow.

Steve Hilton (Republican) and Xavier Becerra (Democrat) top polls in California gubernatorial race with each polling ~26 per cent.

SoftBank opts to build €75bn AI facility in France, with the facility planned to be Europe’s largest.

Polling by Survation suggests that Andy Burnham holds 10-point poll lead in Makerfield, with Reform UK’s candidate trailing behind.

Home Office admits to insufficiently collecting data on failed asylum seekers.

US State Department condemns British government over two-tier policing in wake of Henry Nowak’s murder.

Former Defence Secretary claims MoD may have misled 2011 Chinook crash review team.

Towering Columns

For The Spectator, David Shipley argues that the murder of Henry Nowak was caused by the police putting ideology before public safety.

Robert France, temporary deputy chief constable for Hampshire and the Isle of Wight has said he is ‘sorry’ that Henry was ‘handcuffed and arrested as he lost consciousness’, and told the BBC that the force has referred itself to the Independent Office for Police Conduct (IOPC). He added that the court pathologist said Henry could not have been saved by earlier medical intervention.

Much attention has been on the issue of Sikhs carrying knives. It is bizarre and stupid that we allow one particular ethno-religious group to carry lethal weapons which are illegal for any other resident or citizen of the country, especially when British women aren’t even allowed to carry pepper spray for self-defence. This exemption must now end.

But in many ways the behaviour of the police in this situation is far worse. There are plenty of dangerous, violent thugs in the country. Some have families who will try to conceal their crimes. But the police are supposed to treat us all equally under the law. Or rather, they were, until the wicked, lethal doctrine of anti-racism captured them.

The police chose to ignore the evidence in front of them in order to believe the Sikh family shouting about ‘racism’. The police ignored the appeals of the 18-year-old white boy bleeding out in front of them. Decades of training on ‘anti-racism’, fear of being labelled ‘racist’, fear of not listening to minority groups. All of these no doubt played a part. This pernicious doctrine of anti-racism has captured the police since the Macpherson report labelled them ‘institutionally racist’. Whatever they were in the 1990s, it seems that our police are now institutionally anti-white.

In The Times, Paul Johnson criticises those that say the government has not raised taxes or intervened enough on the economy.

Meanwhile, the pretenders to the throne appear as unprepared for office as the current prime minister was two years ago.

I’m delighted that both Andy Burnham and Wes Streeting are talking about reforming our capital taxes. Capital gains tax is in need of reform. But look at its scale. It raises about £20 billion of £1,100 billion of total revenue. Wise reforms would struggle to increase that by more than a small number of billions. Burnham’s call for a land tax I also agree with. But our problem here is not that we tax land and property too little. By international standards we tax it rather a lot. The problem is our current system is catastrophically damaging. Yes, please reform it. No, don’t pretend that is a way to repair the public finances. And please don’t claim that a wealth tax is the answer to all our ills.

As for Burnham’s general schtick that the current government hasn’t been left wing or interventionist enough. One does wonder whether he has been paying attention. This is, after all, a government that has increased taxes by something like £60 billion and public spending by a lot more than that, has substantially raised the minimum wage, is bringing rail and steel into public ownership, has scrapped the two-child limit and abandoned any effort at welfare reform, is stopping exploration in the North Sea and going hell-for-leather for net zero, and is implementing transformational additional regulation of employment and of rental housing. This is no Blairite tribute act.

The overall impression is that both those occupying the highest office and those vying for it have lost the capacity to focus on underlying problems while continually chasing the next day’s headlines. Any organisation which spends all its time firefighting, while neglecting to focus on its underlying problems and on its strategy will inevitably fail. So it is with governments.

In The Spectator, Michael Gove laments a political class addicted to policy gimmicks and unable to debate the big issues defining our age.

Only last week Rachel Reeves made an emergency fiscal statement to the house, responding to the consequences of war in the Middle East. The most significant headline measure was a VAT cut on fairs, zoos and theme parks. A titanic battle has been raging between a theocratic state sponsoring terror networks bent on acquiring nuclear capability and the world’s pre-eminent military and economic power. That war has choked off the world’s oil supplies, undermined the principle of global freedom of navigation and undermined food security. And our finance minister’s response is to shave a few quid off a day out at Alton Towers.

At least when Ed Davey careered down multiple waterslides during the election he acknowledged it was a gimmick. Reeves appears to think it’s up there with the Marshall Plan as a wartime reconstruction programme. We may be picnicking on the edge of a volcano, but the meal deal itself has never been better value. If the Chancellor’s response to a war raging now is so pettily inconsequential, how on earth do we think she will prepare us for the shocks about to hit us which are even more profound and long-lasting?

AI’s ability to perform almost all basic clerical research and analytical tasks at a speed which no human can match and with a level of sophistication few could outdo is likely to render most entry-level professional jobs redundant. The basic work of accountants, lawyers, management consultants and bankers could be done better, faster and much, much cheaper by machines – all with the barest of human supervision. That change is not a generation away. It is coming within months and years and will hit a generation already alienated from capitalism and democracy by the weight of student loans, the cost of housing and the comfort in which elderly elites now live…

This moment in our national life is, above all, a time for seriousness. Yet our government fiddles with bus fares and funfair prices. And Reform, the opposition party which currently leads in the polls, offers ludicrously unworkable tax cuts – and social media spats between its leaders – for our entertainment. This is candy-floss economics and coconut-shy politics while the world is transformed at a pace and in a manner unseen for centuries.

In Conservative Home, Laurence Fredricks warns that Burnham’s myopic focus on social housing will see fewer homes being built.

Development is too often treated as a public service, something that can be ordered into action by politicians, burdened with social obligations, and still deliver with little regard for the costs. Development is a business. Business runs on profit, to survive, crucially, but also to grow and deliver more homes. This is true at every scale, from SME housebuilders to the major developers. Without a profit incentive, homes do not get built.

Burnham’s “housing first” platform centres on social housing as an alternative to the housing market: “We really haven’t had that approach in this country since the post-war years.” But post-war Britain was not a world without markets or private development. The difference was that homes could still be built at scale. What changed later was the emergence of an increasingly restrictive planning system that chokes supply. That, far more than the commodification of housing, is what created today’s crisis.

The direction of travel being set by the PM-in-waiting should be a grave concern. Instead of recognising the planning system and the mounting burdens placed on developers as the real barriers to housebuilding, Britain risks drifting toward a state led housing model where the delivery of housing comes at any cost – with the taxpayer ultimately footing the bill. The answer is not to berate the commodification of housing, or treat housing as a public service to be commanded into existence. It is to fix the planning system, restore viability, and give the market the conditions it needs to deliver.

For The Times, Robert Colvile highlights the hypocrisy of the left allowing foreign oil and gas imports whilst shutting down the North Sea.

It’s true that Britain, like many other countries, is cutting petrol taxes to help consumers (or rather postponing a planned increase). And if you squint very hard, you can see Rachel Reeves’s gimmicky tax breaks for summer holidays as a backhanded way of saving on jet fuel, on the principle that 15 per cent off a trip to Thorpe Park might make people slightly less inclined to fly to Disney World.

Yet the King’s Speech pledged to make it actively illegal to grant new oil and gas licences in the North Sea. Leading to the absurd spectacle — highlighted by Kemi Badenoch and her energy spokeswoman, Claire Coutinho — of Labour MPs voting through the ban even as the government was relaxing restrictions on the import of Russian oil refined in third countries, to shore up supplies of that precious aviation fuel.

But that’s not the end of the hypocrisy. Miliband can talk all he wants about all the wind turbines he is building. But even if we completely decarbonise the electricity grid in the next few years, we will still be using fossil fuels for a load of other things for the foreseeable future: heating our homes, fuelling our cars, powering factories, smelters and data centres. In fact, in 2024 we imported energy equivalent to 138.9 million tonnes of oil. Netted off against our exports, that translates to 44 per cent of our overall energy needs coming from abroad — the highest proportion in a decade.

And what kind of energy were we importing? The vast bulk — more than 90 per cent — was made up of oil and gas. And our largest supplier was Norway. In short, as I’ve pointed out before, we are paying the Norwegians billions of pounds to send us oil and gas from exactly the same North Sea basin we refuse to properly exploit ourselves — because of a ludicrous piece of climate arithmetic which counts the emissions from the stuff we drill but not the stuff we buy.

In The Spectator, Stephen Pollard says we are giving anti-Semites a cultural veto after a talk on Jewish culture was postponed due to concerns about security.

Interviewed earlier this month at the Cannes film festival, Hungarian filmmaker László Nemes spoke of the ‘shameless orgy of anti-Semitism overtaking the West.’ The director of Son of Saul was stating something both profound and obvious, and here in the UK we see examples every week – and it sometimes feels like every day. On Tuesday, the British Museum informed ticket holders to a talk scheduled for today as part of Jewish Culture Month that, ‘Due to security concerns, the Ancient Israel and Judah in the British Museum talk… has been postponed.’

It was the matter-of-fact blandness of the statement that hit hardest. ‘We apologise for any inconvenience. With best wishes, The British Museum Ticketing team.’ Oh well, just a bit of Jew hunting, sorry if it’s a bother, best wishes and all that…Increasingly, events involving or attracting Jews are being cancelled – and that’s when they have managed to find a venue willing to host them in the first place…

Whatever the actual motivations behind such decisions, they all have the same effect – handing anti-Semites a veto over the staging of events with or for Jews. Let’s accept that the British Museum has acted in good faith, as it says in its statement. So what? The outcome is the same as when the West Midlands police caved in to the Jew hating mob and banned Israeli fans – Jews – from attending Aston Villa’s match against Maccabi last year. Their reasoning might be different, but their decisions have had a similar consequence. The British Museum has allowed Jew hate to determine its programme. By postponing a talk on Ancient Israel and Judah.

Let’s reserve judgement on whether this is actually a postponement or, as I suspect it will end up, a cancellation. One of our leading cultural intuitions has sent out a terrible message. Do you worst, it is saying to the anti-Semites, and we will cave. For shame.

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Wonky Thinking

A new report by Boston Consulting Group has found that our financial services sector is underperforming due to a lack of capital, stalling productivity and declining employment. The sector that once drove UK productivity growth now actively drags it down. Had the sector continued to grow at its pre-crash trajectory, it would be 40% larger than it is today. This equates to an additional £66 billion in output and £100 billion added to the wider economy. The research has found:

• Business lending has seized: Total lending to private non-financial corporations has returned to levels last seen in 1998, standing at 59% of GDP in Q3 2025, with both bank lending and other forms of credit having fallen as a share of GDP. SME loans have almost halved as a share of GDP since 2011.

• Productivity growth has stalled: The sector’s contribution to aggregate productivity growth has flipped from +3.5% pre-2008 to -1% in 2019–2024, meaning it is now actively dragging down UK productivity growth. A more sector-specific productivity metric – annualised change in assets per employee (inflation-adjusted with CPI) – has been zero for the past five years in the UK compared with 1% in the US.¹

• Shareholders have lost out: If £100 was invested in UK financial services stock in April 2011, its total value would be worth £185 less by the end of 2025 than if invested in US financials and £108 less than if invested into UK industrials.

• Employment has declined: Jobs in UK financial services have fallen 1% since 2011, while the equivalent employment has grown 17% in the US and 16% in France. Assets per employee, however, have remained static in the UK.

• Capital is not flowing where it is needed. 53% of total pension fund allocation was invested in UK equities in 1997 compared to 4% in 2022 and 82% of US pension funds allocated to equities. UK households have the lowest share of personal wealth held in equities and mutual funds in the G7, at 8%.

The report also identified three policy choices that the UK government has made that have constrained growth.

Regulation was recalibrated for resilience but not updated for growth
New regulation after the GFC strengthened the sector’s resilience but institutionalised a bias towards removing all risk over growth. The system-wide UK LCR stands at 152% in 2025, far above the 100% Basel minimum and the 120–140% seen in US and EU peers. The UK’s CET1 ratio is 15.4%, two percentage points above the US (13.4%). If UK banks reduced capital buffers to US levels – still within requirements – this could release up to £440 billion in capital, which could be channelled towards lending. Meanwhile, consumer regulation has resulted in 23 million consumers going without financial advice. Compliance and quality-assurance headcount rose 503% from 2009–2021, before settling at 208% of 2009 levels.¹⁹ This compares to just 78% growth in the US.

Business credit has become structurally harder to access
UK businesses are caught in a self-reinforcing credit trap. Businesses seek credit less readily because they expect rejection; lenders pull back because they see insufficient demand. Both sides have rational reasons to behave as they do – but together, this has resulted in total lending to SMEs falling from 12% of GDP in mid-2011 to 6.5% in 2026. It has also become even more concentrated, with the share of lending to SMEs in the real estate sector rising from 39% in 2016 to 51% in 2026 – despite only 3% of total SMEs operating in the real estate sector. The reasons for this appear two-fold. First, it is expensive and time-consuming for banks to find, vet and onboard smaller borrowers. Second, regulatory constraints require banks to hold more capital against loans to these businesses because they are harder to assess – many lack the physical assets that banks traditionally use as security.

Technology underinvestment leaves UK firms exposed to the AI era
In the early 2000s, because of its relatively advanced integration of technology, the UK financial services sector had the highest level of capital stock in software and databases of any advanced economy. However, the capital stock of computer software in UK financial services has grown at a rate of just 2.5% a year since 2010. This compares with 6.7% in the US – meaning total US stock has almost doubled in a decade, while the UK equivalent grew by just 30%. The UK now lags the US, Japan and Spain in terms of capital stock of software and databases as a share of total assets. The divergence since 2010 is a direct consequence of the active choices described above. This gap means UK firms are entering the AI era further behind than many peers.

Why has this happened? High costs and legacy tech stacks are common across the sector in different countries. But UK banks tend to have higher cost income ratios than most, regularly over 60% of income. Furthermore, the UK lacks the scale of the US market or the rapid growth of some smaller economies, both of which make developing economies of scale challenging.

On his Substack, David Goodhart has published an essay on the emerging post-liberal consensus amongst the British public which has rebelled against the neoliberalism that has dominated the political debate for the past forty years. He proposes a manifesto for ‘left-conservatism’ which combines cultural conservatism whilst encouraging a system of national preference on the economy and business.

My own version, that I would categorise as belonging to the Left-conservative school of post-liberalism—a synthesis of moderate social democracy and moderate cultural conservatism—has three main elements.

1. Small-c conservative common-sense.

• Acceptance of the moral equality of all humans but rejection of the moral universalism and post-nationalism of the liberal Left, (promoted in some aspects of international law).

• Restoring authority to elected politicians.

• An immigration pause, plus the understanding that a society with a shrinking ethnic core needs an attractive, broad-based national identity more than ever.

• A belief in personal responsibility and reciprocity, entailing a shift to a more contributory welfare state.

• Money alone is not the answer to poverty and social dysfunction, family structure/upbringing matter.

• More support for stable families, marriage and higher fertility by minimising the motherhood penalty but also by making it easier for one parent to remain at home when children are pre-school.

2. Market-friendly, national social democracy.

• A national business preference in public procurement.

• Tougher paternalistic regulation of industries with power to poison bodies (food) and minds (tech).

• Less market in some key public utilities but more market in areas where competition is weak.

• Transition to Dutch-style social insurance model for health and social care.

• An end to this version of net-zero, and lowest possible energy costs for businesses and households.

• Limited use of subsidies and tariffs to prioritise national industry, reshoring and innovation, and national control over critical infrastructure/utilities.

• Incentivisation of a more patriotic business elite, and clearer distinction in the tax system between the productive and unproductive rich (a land tax?).

• Reduction in the tax/regulatory burden on small business.· Promoting higher levels of home ownership and entrepreneurship, especially among young people.

3. A regional settlement to tackle the crisis of demoralisation in Somewhere Britain.

• Tackle extreme regional divides by promoting not just public investment and growth companies in left-behind places but investing in grass-roots institutions: sports clubs, youth clubs, pubs.

• We need our elite universities but must reverse the over-production of people with generalist academic qualifications and under-production of skilled workers and technicians.

• Create more outlets for public spiritedness. In a more dangerous world, with more erratic climate, we need an expanded military reserve plus a civic and environmental taskforce. We also need an easy-to-use online national volunteering platform.

This is not a radical manifesto but it cuts across still powerful liberal assumptions in key areas: the reluctance to accept discomfort at rapid ethnic change as legitimate; the economism of so much social policy that focuses almost exclusively on higher welfare payments; the persistent belief that more graduates is good for the economy and society; reluctance to re-think rights legislation or international conventions even when they thwart democratic common sense. There are policies here borrowed from Right and Left traditions but the Right bloc in British politics would be most comfortable with it.

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Podcasts of the Week

In The Spectator’s Coffee House Shots podcast this week, Tim Shipman and James Heale interview Joshi Herrmann, founder and editor of Mill Media, who has been closely following Andy Burnham’s career in Greater Manchester. They discuss whether Burnham’s emotional style of politics will be successful in the much tougher world of Westminster politics.

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Quick Links

A majority (65%) of Britons believe that we should stop prioritising clean energy over cheaper energy.

Household energy prices will rise by 13% in July, an average of £221 per household.

The number of young people not seeking work is the highest since records began.

Same review finds we are spending twenty five times more on welfare for young people than helping them to find work.

Energy intensive manufacturing production has fallen by 40% since 2015.

Charity led by Green Party’s Makerfield by-election candidate calls for farming to be ‘decolonised’.

Live births per year by mothers born in the UK have fallen by over 100,000 in the past decade.

We also know that Reader readers are interested in different forms of content, so we are planning to publish book reviews to help keep readers up to date with the latest ideas - The Conservative Reads. If you have suggestions for books that we should review or wish to submit a review, then do please get in touch.

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Centrists of the World Unite! is the more considered print version of one of the fastest growing forms of elite media, the ‘Centrist Dad’. However, unlike the plethora of podcasts that have infected our feeds, Wooldridge brings the knowledge and insight you’d expect from a well-respected Economist, and now Bloomberg, journalist. Rather than endlessly blaming foreign actors or ‘disinformation’ for recent events, like most of the Centrist Dad Universe, Wooldridge has come to see that there is something fundamentally rotten in the state of the Western world.

The essence of the book’s argument is that the positive qualities of liberalism (meritocracy, pluralism, belief in free exchange) have been shunted aside for identity politics, globalism and market fundamentalism. In many cases, these darker sides to liberalism emerged for understandable reasons (the civil rights movement, the opportunities from global free trade, reaction to trade union militancy) but they have simply gone too far. The ‘good old liberalism’ was replaced with “liberal triumphalism” that simply went too far and tried to spread these values at the point of a gun around the world.

In many ways, it builds on the (in my view stronger) argument made by now Shadow Justice Secretary, Nick Timothy, in his excellent book Remaking One Nation which called for a defence of ‘essential liberalism’ rather than the ‘elite liberalism’ of the kind that Wooldridge also attacks. The consequence of this perversion of liberalism, as Wooldridge sees it, is that it has created reactions (Brexit, Trump, Reform - insert your centrist bête noire here) that are pulling society apart. The response is that centrists (and I presume Wooldridge would include many conservatives in this) need to come together and put good old fashioned liberalism back at the heart of our politics.

So much of the book is a Centrist Dad version of the Aristotelian ‘Golden Mean’. Can we have authority and hierarchy, but not too much? Can we have free markets and free choice but also a “liberal paternalism” that stops people making the wrong decisions? Can we have empowered nation states but also keep the global institutions to enforce the rules based international order? Can we be progressive but not have too much progress? Basically, can we go back to that golden period of the 1980s and 1990s where everything seemed to be going quite well?

The obvious answer is no. We cannot. Why not? Simply put, liberalism is not a self-correcting system that allows for this ‘Golden Mean’. The biggest barrier to centrist liberalism is the very philosophy that Wooldridge espouses.

What does liberalism mean to Wooldridge? “Individuality”, “freedom” and “tolerance”. As Wooldridge says:

“Liberals start with the individual and work upwards where previous political systems had started with the collective (the community or the state) and worked downwards. Liberals believe that people should be judged as individuals rather than as members of social and biological groups. They also regard freedom as the signature political virtue…Liberalism broke with the idea that we should pursue collective salvation by worshipping in the same church and living according to the same political code.”

Strangely, Wooldridge says that this political liberalism was born against the ‘extremes’ of the French Revolution. This would no doubt come as a surprise to men such as Robespierre, Danton and Saint-Just who very much saw themselves as embodying these liberal ideals. After all, their so-called Montagnard Constitution of 1793, is a liberal document par excellence. After stating the goal of society is “the common welfare”, it then states that “Government is instituted in order to guarantee to man the enjoyment of his natural and imprescriptible rights.” These rights are “equality, liberty, security and property…liberty is the power that belongs to man to do whatever is not injurious to the rights of others; it has nature for its principle, justice for its rule, law for its defence; its moral limit is in this maxim: Do not do to another that which you do not wish should be done to you.” The problem has always been, as critics such as Burke and Hegel articulated at the time, that relying on these abstract liberal principles is a recipe for disaster because they create concepts that can never be realised and constantly tear down any positive project to build a better society. This mistake is compounded with political liberalism’s other essential feature, that all decisions must be valid through the logic of Kantian pure practical reason where all traditions, contingencies and faith are removed and only those decisions that the sovereign individual can make into universalising categorial imperatives are valid. It leads to the dead end of Rawlsian liberalism. This is not merely a matter of historical debate, but something that shapes the biggest issues of our time.

The author is a scathing critic of the “politics of identity” on both left and right. He is justly concerned about the rise of Islamism and blasphemy laws but also ethnonationalism on the right. However, as with so many things, the author does not seem to understand that liberalism has created this existential battle for identity because it has stripped national identity of any substantive content. Do not be an Islamist. Do not be an ethnonationalist. But what should one be? A conservative can answer easily. Be British. Loyally support our Crown and our Constitution, participate in those local institutions that give us meaning from the school fete to the local sports club and meet your civic responsibilities through jury service, voting and helping your fellows. What does the liberal offer? Defend ‘liberal values’. In his call for an end to culture wars, Wooldridge draws on similar ideas of ‘civic nationalism’ which Martin Wolf calls for in his recent centrist book The Crisis of Democratic Capitalism. Yet ultimately when you peel away the packaging of this civic nationalism, there is nothing in the box. For the abstract liberal values that they are calling for us to defend are the very values which those on the far-right and Islamists are using to justify their actions (the freedom of their religion, their freedom of speech etc.). This liberal nationalism is not rooted in anything real, it is just people shouting at each other.

The only answer to the extremes that threaten to pull us apart is not to quote John Stuart Mill at people or invent some pseudo-legal sounding rights. Our response to these people is simply to say that “we do not do this sort of thing here”, appealing to our traditions, our institutions and the long-held beliefs. It is a reasoned belief, drawn on our experience and our preferences. This conservatism enables us to see things as they are. We do not really believe in freedom of speech. We have a generous tradition that should be able to speak, write and debate what they like providing it does not disturb the public peace. It is a tradition that emerged through centuries of give and take, experimentation and contingency. It does not depend on liberalism (toleration predates liberalism by hundreds of years, as Wooldridge notes) and cannot be defined or implemented in an abstract way, it is simply a matter of judgement. It is a judgement that we have entrusted to our politicians and our courts because we assumed they would operate within our political tradition or put the national interest (balancing the positive benefits of freedom with the equal positive of public order). This limit has been fairly broad in our recent history because we did the hard work of building a strong social fabric where people shared most of their fundamental beliefs (Monarchy, Parliamentary Democracy, The Rule of Law, Christianity) and assumed the patriotic commitment of others. In times of war or crisis, most people have no qualms with restriction because we know that different circumstances require the boundaries to be reset, but we trust that when peace returns, we can return to normal. British liberty is the consequence of delicate balance based on a shared history and a shared culture. It is a system breaking down because we have tried to universalise it and appeal to abstract ideals, rather than making decisions in the national interest.

The same is true for our economic order and the global order. The biggest sustained rise in living standards was not under the ‘liberal’ economic order of the 19th Century, which the author approvingly references, but the system we developed after the Second World War to avoid mass unemployment and poverty. The global order was balanced at those times when we decided not to trust our security to vague notions of universal citizenship, but when we had strong defences and mutual respect.

Ultimately, it is the British (and to some extent American) political tradition that Wooldridge is essentially defending and with good reason. It is the tradition that conservatives defend because it is our tradition, our living tradition, not because it conforms to some dead philosopher or international treaty. The good news is that you can get all the benefits of liberalism that Woolridge states (meritocracy, equality before the law, market capitalism) without having to embrace the round-about way that he chooses to get to these outcomes.

The author makes many good points, but rather than being a centrist or a liberal, he sounds like a lost conservative. A conservative who has ignored a positive disposition - a liberal, tolerant one - and instead embraced a doomed political project. The only political project that matters is not maintaining a desiccated universal liberalism, but defending the British constitutional and cultural settlement that we have inherited through the generations. You cannot achieve this conservative end, however, with liberal thought because it denies you the very tools you need to do the job.

Wooldridge thinks that liberalism is like the Holy Spear in Wagner’s Parsifal. Where only the weapon that made the wound can heal it. I’m afraid to tell the author, that unlike in Wagner’s magical opera, picking up the spear of liberalism will not heal the wounds it has created, it will simply create more of them.

You can buy a copy of Centrists of the World Unite! The Lost Genius of Liberalism by Adrian Wooldridge online or, even better, support your local bookshop.

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.

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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.

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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…

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2 months ago · 7 likes · Outpost

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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.

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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?’

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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.

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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.

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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.

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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…

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2 months ago · 2 likes · Outpost

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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.

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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.

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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.

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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.

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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”.

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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.

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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.

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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’.

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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.

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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…

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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.

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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”.

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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.

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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.

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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.

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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….

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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…

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4 months ago · 21 likes · Eric Kaufmann

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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.

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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.

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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.

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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.

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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.

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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.

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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.