The delusion of centrism

Austerity economics with social liberalism is the wrong way forward

Towering columns

In The Times, Juliet Samuel says the Supreme Court ruling has demonstrated the urgent need to adapt postwar institutions to the age of mass migration.

The government was expecting a defeat of some kind but had hoped the judgment might contain some wriggle room. Instead, the court essentially ruled that Kigali cannot be trusted, making any deal with the country illegal not only under UK or European human rights law but under a whole bunch of UN treaties too. But at least there is now no ambiguity. In the absence of fundamental reform, it is almost impossible for a country committed to international law to control its borders…

…The UK should lead an effort to renegotiate the treaties that make it impossible, in an era of much higher migration, to control our borders. Britain is not alone in being stuck in this politically ruinous legal trap. Germany, Denmark, Italy and Austria are all in the process of trying to come up with their own “Rwanda-type” policies.

The EU itself has only kept a lid on migration by circumventing the ECHR entirely and striking its own controversial deals with foreign governments. Someone needs to call time on this ridiculous legal run-around. The swamp of human rights law has left European countries under constant threat of massive migration influxes, a situation that voters across the continent rightly find unacceptable and one that would never in a million years have been endorsed by the drafters of these treaties.

It ought to be possible to build a coalition to push for fundamental change. The concepts and institutions of human rights law were born out of war and atrocities in Europe; if together we cannot make them fit for the modern age, then they will ultimately die here too.

In The Telegraph, Richard Ekins argues that the Government can save the Rwanda Scheme by following a policy of offshoring.

The Illegal Migration Act 2023, which has not yet been brought into force, did not anticipate and address the legal risk that has now been realised in the Supreme Court’s judgment. The Act cannot now be used to put the Rwanda policy into effect because the Act authorises the Upper Tribunal to “suspend” removals if there is a risk of onward removal to an unsafe country. 

The simplest way to respond to the judgment might seem to be to revise the agreement with Rwanda. The Supreme Court left open the prospect that a future Rwandan asylum system might be up to scratch. The problem for the Government is that the Court seems to thinks Rwanda is unlikely to honour its assurances. However, it might make a difference if Rwanda agreed not to remove failed asylum-seekers without UK officials reviewing their case.  

This points the way towards a better alternative, which is to abandon a policy of outsourcing asylum claims to Rwanda and instead to adopt a policy of offshoring, whereby UK officials process claims outside the UK, whether in Rwanda or in a British overseas territory, with genuine refugees then settled in safe third countries. Policy Exchange has repeatedly argued for offshoring, with clear statutory authority, on the grounds that it minimises legal risk and avoids the charge that the UK is not taking responsibility for protecting asylum-seekers. If UK officials process claims, there is no reason why Rwanda cannot be a safe-third country for settlement.

In The Critic, Gavin Rice explains why elite support for economic and social liberalism does not reflect the views of the majority.

The return of David Cameron is perhaps the move most open to symbolic over-interpretation. Downing Street is keen to show its moral seriousness about governing by bringing in a respected elder statesman and to show the public their operation is — unlike the short-lived Truss disaster that went before it — grown-up. There is some logic to this.

Again, however, the narrative that we either want or need a “Cameroon” pivot must be resisted. First, Cameron was and is a more complex figure than the liberal “centrist dad” of media bubble imaginings. The robust response of the Coalition government to the 2011 London riots — which really does put the Met’s handling of recent lawlessness to shame — was not that of a “wet” administration. Cameron’s public commitment to bringing net migration down to the “tens of thousands”, whilst never delivered, went well beyond anything this post-Brexit government has committed to. Cameron campaigned to replace the Human Rights Act with a domestic alternative, and his implementation of the Marriage Tax Allowance displayed some of his more socially conservative instincts.

More important than Cameron himself is the way the political commentariat is seeking to depict Cameroon policy. Whilst George Osborne’s stint as Chancellor may continue to be written up as part of a wider “centrist” project of Tory modernisation, in reality, it was anything but. The swingeing cuts to public spending undoubtedly hollowed out state capacity, and the impact of cuts to capital investment remains with us through structurally lower growth.

As polling by Onward has consistently shown, the general public does not support a state-slashing, tax-cutting economic agenda. Neither are they supportive of “wet Tory” social liberalism on immigration, crime and culture. The “centre ground” of SW1 is no such thing in the country. The electorate — including target Conservative voters — are consistently to the left of Tory MPs on issues of tax and spend, but consistently to the right on social issues. As the Economist’s Bagehot column argues this week, the Cameron project only succeeded (and by the narrowest of margins) despite its platform of austerity and liberalism, not because of it.

In UnHerd, Giles Fraser exposes how the liberal middle classes are allowing the so-called march for peace to enable pro-Hamas sympathisers.

Cars flying Palestinian flags wound down their windows to shout insults and let off intimidating flares. A Jewish home in North London had red paint thrown all over it, designed to look like blood. On the “peace march” one Labour party member from Eastbourne carried a banner with a swastika entwined within a Star of David. Another chap wearing a keffiyeh over his face explained: “Hitler knew how to deal with these people.” Others thought it would be fun to cosplay with Hamas ensignia.

These are not what you might call “micro” aggressions. And hundreds of thousands marched through the centre of London many of them chanting “from the river to the sea” — which, however intended, amounts to a call for the eradication of Jews from Israel. October 7 shows what Jews face when they are not secure in their own land.

But drunk on their own righteousness — not Stella — even the most well-intentioned are often complacently Hamas adjacent, and literally so, marching alongside those who feel justified to use the most glaring of antisemitic tropes on their banners: Netanyahu with devil horns, a Jewish snake wrapped around the world, calls to “globalise the intifada”. I wonder how many of those who carry banners accusing Israel of being child murderers know that the blood libel was invented in this country in the 13th century with accusations that Jews murdered the children Hugh of Lincoln and William of Norwich and drank their blood. Can people really not see the connection? Of course there were good people on the march, but good people can also be the problem, providing cover for those who manifestly are not.

The antisemitism of the hard Right and the hard Left is easily spotted and readily damned. But it is the genteel, middle-class, soft-Left, hand-wringing antisemitism — the kind that wouldn’t dream of saying anything crass or extreme — that has been legitimised, has become high-status opinion even, on the streets of London. Do not think that your feel-good liberalism or soft leftism is any sort of prophylactic against your antisemitism. It isn’t.

In The Telegraph, Natasha Hausdorff criticises Western institutions for using lawfare against the IDF to undermine Israel’s war effort.

International law is being misrepresented, and even inverted, to attack the only democracy in the Middle East and to justify and defend Hamas’s terrorism. This “lawfare” has focused on three aspects of Israel’s response to Hamas’s October 7 massacre – Israel’s proportionality, its siege of Gaza, and its efforts to distinguish between terrorists and civilians.

Proportionality under the law of armed conflict is not a comparison of the casualty figures on each side. Proportionality requires that the risk to civilians in any strike must not be excessive in relation to the anticipated military advantage. This principle requires responsible armies to mitigate civilian casualties as far as possible.

The laws of war acknowledge that collateral damage is unavoidable in armed conflict. Indeed, according to UN statistics, the global average ratio of civilian-to-combatant deaths is a disturbing 9:1. In Israel’s last operation in Gaza, in May this year, the IDF achieved a civilian-to-combatant ratio of 0.6:1. Hamas’s use of Palestinian civilians as human shields consistently seeks to undermine Israel’s unparalleled efforts in this regard.

The IDF goes further than any army in the history of warfare to protect civilian lives. By giving advance notice of its military targets, the IDF provides civilians (and, of course, the terrorists) with opportunities to evacuate, often at the expense of achieving military objectives. By contrast, Hamas has used roadblocks to prevent civilians from evacuating, cynically increasing casualties in an effort to pile international pressure on the nation to cease its self-defence. Awful footage from Gaza shows Hamas gunning down its own people as they evacuate southwards.

At Freethinking Economist, Giles Wilkes unpacks why Britain has struggled to sustain strong economic growth over the past fifteen years.

For a long time, Western Consuming countries passively enjoyed the benefit of falling prices that stemmed from the incorporation of the East into our trading networks, and the constant improvement that their factories achieved. That came to an end. Maybe it had a natural limit. The Financial Crisis will not have helped. Rising Chinese wages likewise. The collapse in the pound from $2.00 to $1.20.

In particular, I think it is a real and important mystery that the explosion of network technology, the incredible GPT that is the smartphone, has not seemingly improved the productivity of other industries. Our ability to gain knowledge and promulgate it has skyrocketted. Why hasn’t that had real, physical consequences? This unbarking dog is one reason I remain sceptical, for now, about artificial intelligence transforming real growth. We still need to demonstrate how to make the last technological marvel do that.

For all that this post is already overlong, it just scratches the surface of the topic, and hides a lot. It doesn’t solve the problem of UK productivity, or even characterise it. Had the UK been a ‘better’ economy, selling for high prices a lot of valuable goods and services that the world really wants, our incomes would be higher, the pound stronger, and all these numbers would look different. What we choose to consume would not have constrained us.

But I find in all this data further confirmation that in a big, connected world full of mostly exogenous technological trends, our future prosperity is, unavoidably, to a large extent out of our hands. Each generation has tended to be more prosperous than the one before because of phenomena like factory managers organising production better, somewhere a long way away. Hairdressers, lawyers, politicians and teachers are better off because of exogenous changes they are not directly responsible for. Economic progress is largely a game of free-riding. It is humbling.

Wonky thinking

In a lecture to the American Federalist Society’s National Lawyers Convention, Bari Weiss provided an analysis of how university campuses became a breeding ground for a progressive ideology that is unravelling the social fabric of the West and providing a safe haven for antisemitism.

When antisemitism moves from the shameful fringe into the public square, it is not about Jews. It is never about Jews. It is about everyone else. It is about the surrounding society or the culture or the country. It is an early warning system—a sign that the society itself is breaking down. That it is dying. It is a symptom of a much deeper crisis—one that explains how, in the span of a little over 20 years since Sept 11, educated people now respond to an act of savagery not with a defense of civilization, but with a defense of barbarism.

It was twenty years ago when I began to encounter the ideology that drives the people who tear down the posters. It was twenty years ago, when I was a college student, that I started writing about a nameless, then-niche worldview that seemed to contradict everything I had been taught since I was a child. At first, things like postmodernism and postcolonialism and postnationalism seemed like wordplay and intellectual games—little puzzles to see how you could “deconstruct” just about anything. What I came to see over time was that it wasn’t going to remain an academic sideshow. And that it sought nothing less than the deconstruction of our civilization from within. 

It seeks to upend the very ideas of right and wrong. It replaces basic ideas of good and evil with a new rubric: the powerless (good) and the powerful (bad). It replaced lots of things. Color blindness with race obsession. Ideas with identity. Debate with denunciation. Persuasion with public shaming. The rule of law with the fury of the mob. People were to be given authority in this new order not in recognition of their gifts, hard work, accomplishments, or contributions to society, but in inverse proportion to the disadvantages their group had suffered, as defined by radical ideologues. 

And so, as an undergraduate, I watched in horror, sounding alarms as loudly as I could. I was told by most adults I knew that yes, it wasn’t great, but not to be so hysterical. Campuses were always hotbeds of radicalism, they said. This ideology, they promised, would surely dissipate as young people made their way in the world. They were wrong. It did not.

Over the past two decades, I saw this inverted worldview swallow all of the crucial sense-making institutions of American life. It started with the universities. Then it moved beyond the quad to cultural institutions—including some I knew well, like The New York Times—as well as every major museum, philanthropy, and media company. It’s taken root at nearly every major corporation. It’s inside our high schools and our elementary schools. 

And it’s come for the law itself. This is something that will not come as a surprise to the Federalist Society. When you see federal judges shouted down at Stanford, you are seeing this ideology. When you see people screaming outside of the homes of certain Supreme Court justices—causing them to need round-the-clock security—you are seeing its logic. The takeover of American institutions by this ideology is so comprehensive that it’s now almost hard for many people to notice it—because it is everywhere.

The Centre for Policy Studies published the essay collection Justice for the Young, edited by Matthew Feeney and Robert Colvile. Falling birth rates and an ageing society have presented new challenges for younger generations who are now struggling to achieve the same financial and social stability as older cohorts.

Today, prosperity in Britain is much more broadly based. But there is still a economic divide running right through the heart of our society. That divide is not between the aristocracy and the rest, but between young and old.

Since 1997, the number of people who own their homes outright, mortgage free, has climbed from 5.2 million to 8.2 million, even as the value of those homes has soared. This represents the greatest increase in wealth in our country’s history. And it is the elderly who have overwhelmingly reaped the benefits. Almost three-quarters of retired households now own their home outright, compared with less than 30% where the main earner is self-employed and less than 20% of those who are employees. Life is also sunny for those approaching pension age: median wealth for households aged 55-66 now averages £553,400, 25 times higher than for those aged 16 to 24, making them the richest cohort in society. Those over-55s are also those most likely to have racked up significant pension savings, which are second only to property as a source of wealth, at 40% and 30% of the national total respectively.

Of course, it is inevitable that those who have worked longest will have accrued the most savings. But the seesaw has tilted hugely in recent years. Between 2006-8 and 2018-20, those aged 65-74 saw their wealth increase by an average of £13,000 just from growth in asset prices, vs £5,000 for those aged 30-39. During that same period, those over 55 have seen their share of household wealth increase by 11%, while those under that age saw it fall by the same amount.

And it is getting hard to see how the younger generations will ever catch up. Today the average house costs almost nine times the average salary, the worst affordability ratio for the past 150 years. With the assistance of favourable tax and monetary policy, many of those who already own have used that wealth to become buy-to-let landlords, making it far harder for first-time buyers to get on the housing ladder. The Centre for Policy Studies has shown that the increase in the number of properties owned by landlords in the decade after the financial crisis (2.1 million) outstripped the number of new homes we built (1.67 million). In other words, we built new homes – but ownership still went backwards.

But it is not just about home ownership. As the essays in this collection show, young people in Britain have an increasingly raw deal. Real wages, having been stagnant for 20 years before the pandemic, are now markedly below where they were in 2021, thanks to the recent inflation spike. The UK has among the highest tuition fees in the OECD, and by most metrics the highest childcare costs. Analysis by the Land, Planning and Development Federation suggests that rising house prices are preventing people having as many children as they want, with owners having more children and renters having fewer. It also found that childbearing rates were higher in areas with more living space.

Book of the week

We recommend The Once and Future Worker by Oren Cass, director of American Compass and former Mitt Romney advisor, which turned five this week. The author seeks a departure from libertarian economics in favour of a genuinely conservative understanding of economic prosperity that tackles wage stagnation, welfare dependency, and deaths of despair.

The primary response to the failure of rising GDP to lift all boats has been a dramatic increase in economic redistribution. Since 1975, total spending on the safety net has quadrupled. Yet the average poverty rate in the 2010s was higher than it was in the 1990s, which in turn had a higher rate than the 1970s. Analysts debate whether upward mobility has merely stalled or sharply fallen, but no one claims that it has improved. Meanwhile, families and even entire communities have collapsed; addiction has surged; life expectancy is now falling.

Rather than reversing course, policy makers wait expectantly for rescue to arrive from an education system that can transform those left behind into those getting ahead. If this were readily available, it would indeed help ease the growing crisis—and, for that matter, solve any number of society’s problems—but no such miracle appears imminent. Despite the nation doubling per-pupil spending and attempting countless education reforms, test scores look no better than they did forty years ago. Most young Americans still do not achieve even a community college degree.

With good reason, then, confidence in national institutions has eroded. Most Americans have felt the country is on the wrong track since even before the late-2000s financial crisis struck. Most Americans expect that the next generation will be worse off than themselves. Outsider candidates across the political spectrum, most notably, of course, Bernie Sanders and Donald Trump, have gained huge followings that would have seemed inconceivable only a few years earlier, simply by observing that we are in fact lost—no matter that their own road maps are flawed in important ways. Even residents of the most prosperous and cloistered enclaves are discovering that, in a democracy, a miserable majority is everyone’s problem.

This book explains where we went off-track and how we might turn around. Its argument, at its most basic, is that work matters. More specifically, it offers what I will call the Working Hypothesis: that a labor market in which workers can support strong families and communities is the central determinant of long-term prosperity and should be the central focus of public policy.

Alongside stable political institutions that protect basic freedoms, family and community provide the social structures necessary to a thriving society and a growing economy. Those institutions in turn rely on a foundation of productive work through which people find purpose and satisfaction in providing for themselves and helping others. The durable growth that produces long-term prosperity is the emergent property of a virtuous cycle in which people who are able to support their families and communities improve their own productivity and raise a subsequent generation able to accomplish even more. Conversely, without access to work that can support them, families struggle to remain intact or to form in the first place, and communities cannot help but dissolve; without stable families and communities, economic opportunity vanishes.

Economic growth and rising material living standards are laudable goals, but they by no means guarantee the health of a labor market that will meet society’s long-term needs. If we pursue growth in ways that erode the labor market’s health, and then redistribute income from the winners to the losers, we can produce impressive-looking economic statistics—for a while. But we will not generate the genuine and sustainable prosperity that we want. Growth that consumes its own prerequisites leads inevitably to stagnation…

…The problem is not so much that public policy has failed as that it has succeeded at the wrong things. America is like the classic romantic-comedy heroine who, as the trailer intones, “had it all, or so she thought.” She has the prestigious job and the elegant apartment, yet she is not happy. She has pursued the wrong goals, she discovers, and to reach them, she sacrificed the things that mattered most.

We got exactly what we thought we wanted: strong overall economic growth and a large GDP, rising material living standards, a generous safety net, rapid improvements in environmental quality, extraordinarily affordable flat-screen televisions and landscaping services. Yet we gave up something we took for granted: a labor market in which the nation’s diverse array of families and communities could support themselves. This was, I will argue, the wrong trade-off, based on incorrect judgments about policies’ true costs and benefits and a poor understanding of what we were undermining. What we have been left with is a society teetering atop eroded foundations, lacking structural integrity, and heading toward collapse.

Quick links

Inflation fell to 4.6%, down from 10.1% in January and meeting one of the government’s five priorities.

For the first time in over a decade house prices fell due to higher mortgage rates.

UK productivity has been almost flat with a 1.7% increase over the 16 years since the financial crisis.

Frozen income tax thresholds could raise an extra £52 billion for the Treasury, the equivalent of a 7p basic rate increase.

The Supreme Court found the Government’s Rwanda migration plan to be unlawful…

…but polling revealed that 48% of Britons support the policy with 35% against.

Labour led in the polls at 44% with the Conservatives at 21% and Reform UK at 10%.

A recent forecast predicted Labour gaining 213 seats and the number of Conservative MPs falling to 151 if an election were held today.

US President Joe Biden and Chinese Premier Xi Jinping met in an effort to ease tensions and agreed to resume military-to-military communication.

Germany has banned all pro-Hamas activities, including protests and use of the Hamas flag.

IDF operations do little to affect Gazan support for terrorist attacks against Israeli civilians.

31% of 2019 Conservative said David Cameron was a good Prime Minister while 35% believed he was a bad Prime Minister, when asked earlier this year.

NHS England started a ten-week review into why the number of patients being treated has not increased despite higher budgets and more staff.

Chancellor Jeremy Hunt will announce back-to-work plan in the autumn statement next week, increasing incentives for benefit claimants to find employment.

The National Trust’s new inclusive calendar excluded Christian holidays such as Easter and Christmas.

Newcastle United suspended a fan’s membership after posting “trans women are men” and referring to gender-affirming surgery as “mutilating children”.

The casualty rate for rental e-scooters is three to four times that for pedal cyclists.

Stack Data Strategy’s MRP model showed Donald Trump on track to win back the presidency in 2024.