The Slow Crash

Labour's Britain is in the death throes of the post-2008 order

Towering Columns

In the Financial Times, Janan Ganesh argues that Keir Starmer needs to fail before Britain can move on.

For voters to accept painful reforms, the status quo has to be tested to failure. That means both of the main political parties must disappoint in government. As long as Britain was stagnant under the Tories, voters could tell themselves that a management switch would get things moving again. If Labour fails too, that hope becomes harder to sustain. It might dawn on people that no one party is the issue so much as an unfit state, which can’t be fixed without creating losers. The triple-locked pensions, the benefits system riddled with perverse incentives, a health service that is forever having to be “saved”: when the slightest reform of these things is tabled, protests fill Whitehall. Perhaps, four years down the line, such resistance will start to look like the problem.

In other words, the failure of this government might be — if the left will lend its language to me for a moment — historically necessary. Starmer can be a useful prime minister to the extent that he sees the status quo through to its terminal point, after which voters concede that all options have been tried bar that of awkward structural reform. Another note on this theme of useful failure. People interpret the problems of the day with reference to whoever is in charge. When a country is going through a malaise under a government of the right, the problem is rampant individualism. When the identical social situation plays out under the left, even if there is broad continuity of policy, the problem is reframed as one of public sector vested interests and the like.

In the US and UK, why did free market ideas not achieve their electoral breakthrough until the turn of the 1980s, given that inflation and industrial strife were severe nearly a decade earlier? In part, because Richard Nixon and Gerald Ford had given way to Jimmy Carter, and Ted Heath to James Callaghan. Once the incumbents were left-of-centre, voters could define the sickness of the age as big government. If there is a failed Labour administration circa 2028, expect the same clarity. In the life of a nation, there is a respectable role for the end-of-an-era figure, who gives the existing way of doing things one more diligent and sincere heave, just to remove all doubt that a new approach is needed. By age and temperament, Starmer fits the profile. Whenever I put forward this (Marxian, I know) argument that another disappointing government is needed as a sort of historical trigger, the best response is, trigger to whom in particular? Who will provide the reforming antithesis to the big-government thesis? Who is Thatcher in this dialectic?

In The Times, Juliet Samuel paints a picture of Starmer’s sclerotic government as representing bureaucracy for bureaucracy’s sake.

Progressives like Starmer are accustomed to think of this critique as a form of nasty right-wing “populism” propagated by fascists. What they don’t seem to realise is that the case for a strong state free of excessive bureaucratic constraints was originally a left-wing concern. The ultimate democratic strong state, outside of wartime, was that of FDR and his New Deal agencies. This was a state that could build dams and power plants and bridges. If it identified a strategic need, it could just hire people, make a plan and meet it.

But sometime in the postwar period, tying up the state in administrative hurdles switched from being a right-wing activity to a left-wing one. This is when the left developed what the progressive American legal scholar Nicholas Bagley has called “the procedure fetish”: the notion that what makes a policy or a government programme legitimate is the process that’s followed to devise and implement it, rather than any outcome it actually achieves. In an American context, it’s all about lawsuits and discovery and counter-suits. In the UK, this manifests more as endless consultations and judicial reviews, environmental impact assessments, planning procedures, evidence gathering, appeals, monitoring and auditing.

The right can of course use process to stop political developments it dislikes just as much as the left. Indeed, one of the more notable conservative victories in the culture wars — halting an epidemic of statue-toppling — was achieved by deploying the planning system (apparently the only petty bureaucracy where “heritage” trumps “decolonisation”). But perhaps because of the political leanings of the professional and legal classes, as well as the left’s generally poor record at winning power through the ballot box, procedure itself has come to be seen primarily as the progressive’s friend. And attacks on procedure or attempts to circumvent it are quickly labelled “fascist”, or at least “neoliberal”.

In The New York Times, Oren Cass says President Trump must deliver a concrete plan to restore manufacturing, cut immigration and decouple from China.

While Mr. Trump owes his political success to reorienting the Republican Party toward working-class priorities, his own priorities have often appeared to lie elsewhere. His first-term tax cuts, extended at immense cost in his signature domestic policy law, were taken straight from the old G.O.P. playbook. His cryptocurrency push serves the narrowest of special interests. Yet the past six months have demonstrated that where the president identifies a priority, this administration is fully capable of providing detailed policy and coordinating complex execution. He can deliver on the vision he was elected to pursue if he can minimize the chaos and provocation and elevate making America great again from a slogan to his animating project. The president has promised to reshore manufacturing, restore balanced trade and counter China’s industrial dominance. This would have been impossible under a World Trade Organization that tolerated wild distortions in the international economy and turned a blind eye especially to China’s abuses. But if Mr. Trump has succeeded in rendering the W.T.O. irrelevant, what replaces it?

…[w]hile such moves [to implement trade protections] would all be consistent with Mr. Trump’s agenda, many conflict with his instincts, at least some of the time. On China, for instance, he has taken a hard line in some contexts but seemed desperate to strike a deal in others. One minute he is restricting the sale of advanced semiconductors from Nvidia; the next he is licensing the sales at the behest of Nvidia’s chief executive. His administration has pressed allies to exclude China from their supply chains, but he has suggested he would welcome Chinese firms setting up shop to manufacture in the United States. The best example of the targeted investment he wants to spur in vital industries is the CHIPS and Science Act, the bipartisan Biden-era legislation that is succeeding in bringing advanced semiconductor manufacturing back to the United States. But Mr. Trump criticizes that effort at every opportunity, even despite his administration’s support for similar legislation on shipbuilding and the Pentagon’s recent unprecedented investment in a rare-earths company.

A parallel story is playing out on immigration, where the administration’s success in securing the border and initiating large-scale deportations has fundamentally shifted the political terrain. The question is no longer whether enforcement will happen, but how. To steadily reduce the population of undocumented immigrants and create better labor market conditions for American workers, the government needs a mandatory system for businesses to check the legal status of employees, and harsh penalties against employers who fail to do so. Compared with the chaotic alternative of ad hoc, site-by-site raids, this offers a more gradual, civil and efficient approach to enforcing the law that even some Democrats, and influential groups like labor unions, may be interested in pursuing.

In The Times, David Smith highlights findings from a new report, arguing that expanding luxury housing to increase overall supply would help to solve the housing crisis.

That conventional thinking is that, if there is a housing affordability problem to be tackled, which there clearly is in the UK, the solution is to increase the supply of affordable housing, and that has driven government policy under both main parties. Under Section 106 agreements, and other policy levers, developers are required to include a significant proportion of affordable housing, ranging from 10 to 50 per cent, in new residential developments above a certain size.

The Abramson-Landvoigt paper looks at three ways of improving housing affordability: increasing the supply of affordable housing, increasing high-end luxury housing and improving mortgage availability. The last of these, a policy that increases demand but not supply, would be particularly bad when it comes to affordability. “Subsidising ownership without building more houses unintentionally worsens housing affordability,” the paper says.

Of the three, the most effective is to allow housebuilders to increase high-end housing supply, because that trickles down into more general improvements in affordability. If supply of such properties is restricted, buyers with money will compete for property at the lower end of the market. As they conclude: “Our analysis indicates that effective policies must increase housing supply. While supply interventions may target specific market segments, their effects extend across the entire housing market. Notably, expanding high-end housing supply reduces competition for mid- and lower-tier units, improving affordability more broadly. A straightforward long-term strategy is for local governments to permit and even support developers in building the housing they find most profitable — often at the higher end of the market.”

At Engelsberg Ideas, Samuel Rubinstein reviews David Woodman’s new book on Aethelstan, the first king of a united England.

Does Æthelstan deserve the title of first king of England? Woodman, as with Æthelstan’s previous biographers, thinks so, and he makes the case effectively. Æthelstan made himself known that way, when he was styled ‘rex Anglorum’. An early genealogy of the West Saxon royal family described him as the ‘first of the kings of the English who ruled alone throughout the entirety of England’. A Latin poem rejoiced that ‘Saxonia’ had been ‘made whole’ (‘perfecta’) in 927, when Æthelstan took over Northumbria. That year, Woodman contends near the end of his book, ought to be ‘as recognisable as 1066’. ‘Perhaps it says something about our collective outlook as a nation’, he continues, ‘that we have historically focused on England’s conquest rather than its formation.’

There are, we might object, some good reasons to remember 1066 better than 927, reasons which go beyond questions of national pathology. One is simply narrative. We know, in considerable detail, what happened in 1066. There are plenty of mysteries, too – was poor Harold killed by an arrow to the eye, or hacked to pieces by a crack team of William’s knights? Had he been crowned by Archbishop Stigand of Canterbury, or Archbishop Ealdred of York? – but we are in the main on solid ground. Not so in 927. It is possible that Æthelstan was able to obtain the north without a stir: he was the brother-in-law of the deceased Viking king, Sihtric, and might therefore have been the acknowledged heir. Some of our sources would rather have us believe that Æthelstan had to make good on his claims with force. We must in the end plead ignorance. England might have been born in 927; but we have no idea what its birth looked like.

More fundamentally, the kingdom that Æthelstan stitched together was a flash in the pan. It didn’t take long, after his death, for Northumbria to slip away. Not even the kingdom as he had found it in 924 was made into a solid, unbreakable unit. In 957 it was briefly divided at the River Thames between his nephews Eadwig and Edgar; in 1016 it was divided again, along the same lines, between Edmund Ironside and Canute. Nor should we forget that Alfred’s, Æthelstan’s, and Edgar’s kingdom was, in the end, conquered twice in the subsequent century. When we commemorate the 1100th anniversary of Æthelstan’s coronation at Kingston – and when, in two years’ time, we celebrate England’s 1100th birthday – we might find it difficult to avoid relapse into the characteristically English pessimism that Woodman holds responsible for our fixation on 1066. We ought not only to give Æthelstan the praise which has for so long been denied him, but also to reflect on the ultimate fragility of his achievement.

For The Spectator, Sam Olsen argues that while the West remains distracted the global centre of power is shifting towards Beijing.

For Britain, this all carries an uncomfortable lesson. The institutions and rules of the Western-led order – the UN, Nato, the Bretton Woods system – are being steadily co-opted, challenged and, in places, duplicated. What ministers in Westminster still wave away as talking shops, the summits of BRICS and the Shanghai Cooperation Organisation are quietly evolving into something more substantial. They now produce development banks, alternative payment systems, and even draft frameworks for AI governance – the slow but deliberate scaffolding of a parallel order.

Taken together, these initiatives form the basis of a new world system: one that borrows the architecture of the West but seeks to rewire its foundations around sovereignty, multipolarity, and Chinese leadership. While Westminster obsesses over welfare rows, NHS queues and migration targets, others are quietly redrawing the global map. Britain clings to the post-1945 furniture as if it were still bolted to the floor. The danger is waking up to find the real rule-making has already shifted to rooms where London has no chair.

The parade in Beijing was not simply a display of new hardware. It was a declaration of intent, a projection of power and a plea for legitimacy, delivered in front of a carefully curated international audience. As Britain lurches from crisis to crisis at home, we should recognise the deeper struggle unfolding: the fight over who writes the rules of the twenty-first century. Power, as history teaches us, only endures when it is coupled with legitimacy. China and Russia, with India and Brazil and others in tow, are betting they can assemble both. The West, distracted and divided, may soon find itself living in a world not of its making.

Wonky Thinking

For RAND, Lennart Heim explains that while China will match American AI capabilities this year, the lead in overall compute capacity will remain with the US.

But why is China still producing competitive models? It's harder for export controls to affect individual training runs than an entire ecosystem. Think of AI compute like factory equipment: Having fewer production lines doesn't prevent you from manufacturing a single product—you might still create that flagship product—but it severely limits your production capacity and market reach. Without the latest machinery, your production costs are higher and efficiency lower while competitors optimize their operations. What's more, the economics of scale work against you: while your competitor with ten factories can spread fixed costs across massive production volumes, driving down unit costs and enabling experimentation with new product lines, you're stuck with higher per-unit costs and limited ability to diversify.

Similarly, when China has less total compute, they can still develop competitive models. After all, even in the United States, companies only spent a fraction of their compute on training frontier models. But China misses out on the economies of scale that allow the United States to deploy AI broadly, experiment with more approaches, support a diverse ecosystem of leading AI companies, and continuously reinvest efficiency gains across their entire AI economy. Critically, this compute disadvantage also limits China's ability to project soft power globally—whether by providing AI services to international markets or by having the capacity to export advanced AI chips to other nations.

However, if current trends in AI training continue—shifting from two chips in 2012 to clusters of hundreds of thousands in 2025—export controls may eventually bite harder. China would need to build significantly larger clusters to compensate for less powerful chips: a cluster of 100,000 Nvidia B200s (a leading U.S. AI chip) might require a Chinese equivalent of 300,000 Ascend 910Cs (China's leading chip), resulting in higher energy consumption and greater engineering complexity for distributing AI workloads. Compounding this hardware gap is Nvidia's sophisticated software and networking ecosystem—crucial for orchestrating massive AI chip clusters and currently unmatched by Chinese alternatives.

This focus on preventing model parity misses the fundamental question: What are the true metrics of AI leadership? We reacted to DeepSeek because it narrowed the gap between U.S. and Chinese model capabilities as measured by benchmark leaderboards and model rankings. However, the fixation misses the broader technological competition.

For example, think of AI systems as “virtual employees” that can perform cognitive labor, replacing remote colleagues you've never met in person. The number of AI employees an economy can deploy hinges directly on its compute resources. With roughly 10 times more compute capacity than China, the United States can field proportionally more AI employees across its economy, in sectors as diverse as drug discovery, logistics optimization, industrial robotics, and AI research itself. This compute advantage therefore compounds into a broader economic advantage over time. As AI systems drive productivity growth and innovation, they strengthen the underlying factors of national power. While China may catch up in individual model quality for now, the true metric of AI leadership might lie in deploying and integrating these systems at scale. In that sense, America's true moat isn't just better models—it's the capacity to deploy and integrate AI in the economy at scale.

For Policy Exchange, Conor Casey, Richard Ekins and Sir Stephen Laws published a report, supported by former Labour Home Secretary Jack Straw, showing that the Good Friday Agreement would not be undermined by Britain leaving the ECHR.

Parliamentarians and other commentators routinely assert that UK withdrawal from the ECHR would somehow breach – or undermine – the Belfast (Good Friday) Agreement. This report shows that the Belfast Agreement does not require either the United Kingdom or the Republic of Ireland to remain a party to the ECHR. Each state has the same right under Article 58 of the ECHR to withdraw from the Convention, a right under international law that is not qualified in any way by the Belfast Agreement. UK withdrawal from the ECHR would not constitute a breach of the Belfast Agreement.

The Belfast Agreement is made up of two closely related agreements. The first is the British-Irish Agreement, which is a treaty between the UK and Ireland. The second is the Multi-Party Agreement, which is a political agreement between the British and Irish governments and several different political parties of Northern Ireland, an agreement that provides the foundation for the peace process. This political agreement turns in part on various commitments made by the British Government and the Irish Government. In signing the British-Irish Agreement, the UK and Ireland agreed “to support, and where appropriate implement, the MultiParty Agreement”, but it is only the former agreement that is binding in international law.

The British-Irish Agreement does not refer to the ECHR and none of its terms suggest in any way that either the UK or Ireland, or both of them, were undertaking to remain member states of the ECHR in perpetuity. The British-Irish Agreement does note that UK and Ireland are both “partners in the European Union”, but no one is seriously suggesting that the UK’s withdrawal from the EU is in breach of the terms of the Agreement. Disputes between Ireland and the UK about this Agreement are to be resolved by negotiation, including within the British-Irish Intergovernmental Conference, and cannot be the subject of binding dispute resolution.

The Multi-Party Agreement does include several references to the ECHR. The context of the Multi-Party Agreement, which includes the troubled history of Northern Ireland and fears about the risks of abuse of devolved power, makes it very clear that these references concern the importance of the law of Northern Ireland imposing limits on the new Assembly and on public bodies exercising devolved power. This report considers closely each reference to the ECHR in the Multi-Party Agreement and shows that, as one would expect in view of the context of the agreement, each reference concerns domestic law and has nothing whatsoever to do with the position in international law. That is, the references to the ECHR in the Multi-Party Agreement have nothing to do with the individual right of petition to the Strasbourg Court, a right which the Belfast Agreement does not create or rely upon, or, more generally, with the UK or Ireland’s acceptance of the Strasbourg Court’s jurisdiction or its developing jurisprudence as a matter of international law. British or Irish withdrawal from the ECHR would in no way undercut, breach or cut across the Multi-Party Agreement.

The British Government’s commitment, per the Multi-Party Agreement, is to incorporate the ECHR into the law of Northern Ireland as a limit on the Assembly and on public bodies, and is intended to form a safeguard against the abuse of devolved power. The enactment of the Northern Ireland Act 1998 and section 6 of the Human Rights Act 1998, insofar as it applied to Northern Ireland, implemented this commitment. The terms of the Multi-Party Agreement, read either as a political agreement that grounds a dynamic peace process or as a strict legal document, confirm that the commitment concerns the law of Northern Ireland in relation to public bodies exercising devolved power and not to the British Government itself and, certainly, not to the Westminster Parliament. If a future government withdraws the UK from the ECHR, the UK’s duty to support the MultiParty Agreement can continue to be met by maintaining in the law of Northern Ireland relevant limits – substantially the existing limits – on the power of the Assembly and public bodies. ECHR withdrawal will not diminish anyone’s rights in Northern Ireland law.

The Multi-Party Agreement is a political agreement and the spirit of the agreement is very important. ECHR withdrawal is not incompatible with the spirit of the agreement. The different parties to the Multi-Party Agreement sought assurances that devolved power would not be abused and agreed that the constitutional status of Northern Ireland, as part of the United Kingdom, would not change without the consent of the people of Northern Ireland, freely given. If the UK is to withdraw from the ECHR, it will be important for the British Government, in line with the spirit of the Multi-Party Agreement, to engage closely with the different parties in Northern Ireland to reassure them that the UK’s withdrawal from the ECHR will not unbalance relations between – the parity of esteem between – the different communities.

The British Government should make use of the institutional framework for which the Multi-Party Agreement makes provision to engage the parties in negotiations about how, or whether, the domestic law of Northern Ireland should change after the UK leaves the ECHR, but that would not give them a veto over withdrawal. The simplest course of action – the default option, but not necessarily the most satisfactory option – would be simply to maintain the existing limits in the Northern Ireland Act and section 6 of the Human Rights Act (in relation to Northern Ireland). But there would be an opportunity to revive discussions about a Bill of Rights for Northern Ireland or to consider enactment of more specific rights that address in detail the concerns that the parties may have. In maintaining the substance of the existing limits, or reworking them after negotiations with the parties, the British Government would not be sundering Northern Ireland from the United Kingdom, for the spirit of the Multi-Party Agreement clearly embraces specific and separate provision for Northern Ireland about devolution and the legal limits on devolved power, as well as the acceptance of the case in principle for the enactment of a distinctively Northern Irish Bill of Rights.

The Windsor Framework (concerning Northern Ireland aspects of Brexit) does not provide any kind of legal limit on the power of a future government to exercise the UK’s right under Article 58 of the ECHR. The UK-EU Trade and Cooperation Agreement entitles the UK or the EU to terminate parts of the Agreement if the UK or an EU member state were to leave the ECHR, but this right of termination (not automatic termination) has to be seen in the context of the more general right to terminate the Agreement. Far from somehow strengthening the case that ECHR withdrawal would undermine the Belfast Agreement, the Trade and Cooperation Agreement confirms that neither the UK nor the EU understood ECHR withdrawal to be incompatible with the Belfast Agreement. The Trade and Cooperation Agreement expressly envisages the UK (or Ireland, as an EU member state) withdrawing from the ECHR and makes provision, as the default state of affairs, for trade and other relations between the UK and EU to continue despite this change in international law.

The claim that UK withdrawal from the ECHR would breach the Belfast Agreement has become a commonplace in some corners of British (and Irish) public life. Yet when one considers the Belfast Agreement carefully, examining the terms of the British-Irish Agreement and the context, spirit and language of the Multi-Party Agreement, it is clear that this is an unsupportable conclusion. Whatever the merits of UK withdrawal from the ECHR, the Belfast Agreement should not be instrumentalised by either side of the debate on withdrawal from the ECHR. In choosing to exercise the UK’s right to withdraw from the ECHR, a future government would neither be flouting the UK’s international obligations under the Belfast Agreement nor failing to respect the political settlement that grounds the peace process.

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