If Britain’s cultural production leads the world in anything, it is in the imagining of grim dystopias which are only elaborated versions of contemporary British life: the line from 1984 to Children of Men is drawn through a particular, grudgingly passive relationship to a smothering Westminster state, in which declining living standards are wearily accepted, and the state’s authoritarianism is veiled by a neurotic, emptily patriotic boosterism.
From 1948 until now: entire British lifetimes could be spent experiencing only decline. That the national mood leading up to this Budget was one of trepidation is not solely the product of the Starmer government’s tin ear for political communications; it simply reflects the reality that Britain’s low-wage, low-productivity economy is the product of decades of political failure, and that there is little immediate prospect of the already wildly unpopular Labour government pulling Britain out of its tailspin. As Tom Hazeldine’s excellent recent survey in the New Left Review of Britain’s political economy underlines, by winning the support of only 20% of British voters at the election, Starmer entered office with “the lowest vote-share that a majority Westminster government has received since the introduction of universal suffrage”. Yet the Prime Minister must already look back on this slender mandate with fond nostalgia: the Budget, squeezing an extra £40 billion of taxes out of Britain’s low-paid workforce to extract — perhaps — 1% GDP growth is not likely to improve it.
The Labour government cannot restore the conditions of post-war social democracy because the underlying basis of that economy, a strong domestic manufacturing base, no longer exists. As Hazeldine’s 2021 book on Northern England, Britain’s economic powerhouse turned welfare sink, observes, the region “has tumbled from a unique pedestal, that of the world’s first industrial region, and fallen further than the world-economic conjuncture demanded. The contribution of manufacturing to national output in the UK has flatlined at just 10 per cent since 2007, barely a third of the figure for Germany and a smaller proportion also than for other comparable economies.” The result is a bizarre anomaly, the nation’s equivalent of possessing a Netherlands or Rhineland and choosing not just to leave it underdeveloped, but to actively un-develop it. The de-industrialisation of the North was a conscious choice made by successive Westminster governments, betting Britain’s future prosperity on a combination of London-centric financialisation and enmeshment in a globalised world economy. Yet the risks of financialisation were shown by the 2008 crash, from which Britain has never recovered; the full price of globalisation, in a now rapidly deglobalising world slipping into conflict between the great industrial land empires, is only now coming into view.
The Trentes Glorieuses, which enabled the expansive welfare state Britain can no longer afford, were a time-limited product of the Second World War, rescuing the British economy, if only temporarily, from the great slump of the Thirties. The great national gamble on financialised globalisation initiated by Thatcher and accelerated by succeeding governments of both parties was itself an attempt to kickstart the faltering economy with which Britain was left, once decades of post-war rebuilding had run their one-time course. It was a drastic form of experimental surgery which the patient is unlikely to survive. Instead of investing in industrial modernisation, Thatcher and her successors squandered natural bounties, such as North Sea oil, on subsidising the selling off the British economy’s essential components to international capital. Scottish nationalists, convinced that they would have invested North Sea oil wealth more wisely than Westminster, are hard to refute: the brief burst of prosperity created was analogous to that of boomers releasing equity from their homes to fund a world cruise, and showed equivalent disdain for their descendants’ chances. The result, as Hazeldine correctly observes, is that Britain is “the worst placed among OECD countries to weather” the coming storms, having “entered a period of marked economic decline compared to other G7 and OECD countries”, a relative decline made tangible to British voters with every foreign holiday.
The results of this decline are now palpable in every aspect of British life: in ballooning healthcare costs somehow leading to declining services, and the attendant national ritual of early morning calls to dismissive receptionists to compete for a narrow window of medical attention — and its corollary, the day-long trip to A&E, a desperate hack of the NHS system which must itself weigh heavily on national productivity.
Britain’s cloud of misery assumes concrete form in provincial high streets of unmitigated gloom, whose shuttered shops are punctuated by vape outlets, phone repairers and cash-only barbers, whose dubious legality are left unexamined by a state desperate for whatever revenue it can take; indeed even Oxford Street is now just another dismal provincial High Street. Our ruling class’s economic model is one so committed to low-wage employment over investment that the Conservative government imported almost 4% of the country’s population in the past two years just to man checkout tills and deliver food on bicycles, juicing gross GDP figures from what has aptly been termed “human quantitative easing”, even as the resulting exactions on housing, infrastructure and societal stability fray what is left of Britain’s social contract.
Indeed, in this grim landscape of tangible decline, where The Telegraph advises the young to emigrate with coldly unarguable rationality, the British social contract is literally a joke. Over the past year or so, friends of otherwise impeccably liberal opinions have forwarded me the “British social contract” meme, the archetypal cultural product of Britain’s younger online Right-wing, in which a hardworking graduate is crushed by taxes to support pensioners in ease and comfort and migrants in social housing. Similarly, friends working in policy report a sudden shift in attitudes in hitherto liberal wonkish colleagues, with their ire focussing particularly on London’s disbursement of social housing to an economically inactive dependent class. Anecdotal though they are, these observations mirror wider social trends. Britain is simply a poor country: 43% of the population earn too little to pay income tax at all. As Britain’s economy withers, the tax burden falls increasingly on a smaller and smaller professional class, its younger members already crushed by student loans and rising housing costs, whose growing sense of despair at diminishing expectations is rapidly curdling into rage against the British state.
The summer’s ethnic riots, like the Brexit Red Wall, provided Westminster with a vigorous display of Northern England’s post-industrial working-class anger at the current political settlement; yet, as with any failing regime, it is disaffected middle-class graduates who pose the greatest threat to its stability. As even The Times, cataloguing the emigration of Britain’s youth to Dubai, can observe: “How much British values actually count for when they are attached to a state that appears to be failing in slow motion, regardless of which party is in government, is a question few of us want to ask.” Significantly poorer than their equivalents in the United States, Australia or Canada, Britain’s middle-class young need only holiday in Europe to observe the significantly higher quality of life, functioning infrastructure and thriving cities of our closest neighbours. To be a young middle-class Briton is to be paid too little to justify current marginal tax rates, and taxed too much to justify the squalid and increasingly inhospitable public realm. The social housing discourse so prevalent on the younger Right offers few solutions beyond explicitly nativist redistribution: just as is shown by the importation of Third World care workers, Britain relies on low-paid migration to keep the welfare state alive, yet the expansion of the welfare state’s embrace beyond the national community threatens the survival of the entire structure through the withdrawal of popular consent. This dynamic will be one of the most turbulent political battlegrounds of the near future, yet Reeves’s Budget steered clear of addressing it, let alone resolving it.
A decade ago, millennial anger at Britain’s faltering social economy created the brief flowering of the Corbynite Left, which has since evaporated as a political force, leaving only a podcast and a handful of poor quality Labour MPs as testament to this forgotten era. As across Europe and the wider Western world, that anti-systemic energy is, among the zoomer generation, whose entire lifetimes have been marked by economic stagnation and slow societal disintegration, now coalescing on the political Right. Yet even here, Britain’s existing political Right offers no credible solutions to the country’s slow economic decline, with the insurgent Reform Party offering Northern England the same Thatcherism that destroyed its economy. Equally, the Conservative Party’s two leadership rivals will spend the Halloween vote competing to invoke the Iron Lady’s ghost, in an act of political necromancy targeted at a membership soon to join her in the Otherworld.
In lieu of other ideas, Labour is committed to recapturing the post-war boom with climate change adopting Hitler’s role as the spur to national regeneration: yet constrained by the Treasury, and fears of the political costs of both borrowing and taxation, there is little prospect of the promised new Green industrial revolution making it off the election manifesto and into reality. Instead, proceeding backwards, Labour’s climate policy looks set to weaken Britain’s energy resilience while boosting the industrial economies of other, even rival countries. Reeves’s commitment to a “green transition” that studiously avoids nuclear power, reversing the direction of travel of other major economies, will make Britain a world leader in being left behind.
Overburdened with unaffordable commitments, with a declining tax base, the British state lurches from crisis to crisis, getting weaker, poorer and less capable at each turn (this is, by the way, the very definition of societal collapse). The economic situation is so dire that tinkering with tax rates offers no meaningful solution: British politicians should instead think of the country in explicitly developmentalist terms, recreating the essential infrastructure — transport links, low-cost energy, the manufacture of basic goods like primary steel — necessary to permit a functioning first-world economy some decades to come. Labour’s promised £100 billion of capital spending through tweaking fiscal rules, if it actually manifests and is targeted sensibly, is a genuinely good policy and a necessary start: but even this huge sum may not be enough to catch up with comparable economies. In his excellent new book, the historical sociologist John A. Hall observes, using South Korea as an example, that “successful development seems to rest on a measure of linkage between state presence, shared national identity, and a benign geopolitical milieu”. Unfortunately for us, decades of failed governance have removed all three from the equation.
Instead, the British state is hurtling into an era of historic crisis for which it is manifestly unprepared; indeed the only sense of urgency shown by Westminster is in thrusting itself deeper and harder into the coming storm, as if unconsciously seeking its own death. The sole function of the British state is to maximise the security and prosperity of the British people; when it ceases to do so, it has lost its legitimacy. As the reactions to yesterday’s Southport revelations, even among the centre-right, highlight, the British state is rapidly losing that legitimacy: there is little in the Budget to restore it. “It falls to this Labour Party, this Labour government, to rebuild Britain once again,” Reeves declared, adding that opposing her Budget means “choosing more austerity, more chaos, more instability” — yet austerity, chaos and instability now seem baked into Britain’s near future. The time for rebuilding Britain will come soon enough, but it is doubtful that Labour will survive in power long enough to take the helm.
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Source: UnHerd Read the original article here: https://unherd.com/