Each room, says Oliver, is occupied by at least one individual, though they usually won’t know or get to know the tenant living down the corridor. Most are young professionals, sometimes lifelong Portsmouthians, sometimes born outside the UK, but usually without any other means to clamber onto the housing ladder in a city where flats and houses are in short supply. But this isn’t a bad life, insists Oliver, himself a landlord. Though they usually stay for just 14 months, he says, HMO tenants benefit from an affordable, bills-included rental package and contribute to their local community — just like the six foreign-born tenants in the building, who all work either in the care industry or the local hospital.

It’s an image at odds with that of HMOs in countless local newspapers, Facebook forums and planning objections. From Bolton to Bognor, Durham to Dover, residents are up in arms, deriding HMOs as slum housing that brings only bored and boisterous tenants, each bringing anti-social behavior to the street, all while piling untold pressure on local services bled dry by austerity. In Derby, HMOs have already been blamed for causing a “spiral of decline” across the city, while in Oldham and Wigan, Spelthorne and Worcester, local campaigners have mounted protests against a “deluge” of these new tenements arriving in their neighborhoods.

Nowhere, however, have tensions escalated so sharply as in Portsmouth. Home to just over 210,000 people, most of them crammed onto 9.5 square kilometers of Portsea Island, competition for accommodation is fierce, with rents shooting up by 29% in recent years. Most properties on offer are flats, though while these command a much higher median rent than a place in an HMO (£1,125pcm versus £695pcm), the ability to charge slightly more per room often means that the ROI is generally higher. The result? Builders’ vans scurrying hither and thither under the screech of seagulls and the low burr of ships’ horns to plaster together new HMOs, while angry residents write increasingly terse objections to new developments.

Even getting an idea of how many HMOs exist is difficult. Officially, there were 4,326 such properties as of April 2024, according to Portsmouth City Council (PCC), though only 28% definitively possess a license to operate from the local authority (the absence of which, ironically, doesn’t automatically lead to the HMO’s closure). This confusion is reflected nationally. The most authoritative number for the total number of HMOs in England and Wales is 182,554 — figures that derive from the 2021 census and, judging from the leap in HMO developments reported in cities across the UK since (79 in Barrow-in-Furness; 141 in Filton, South Gloucestershire; 550 in Bolton), wildly unreliable.

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Data on who’s living in these properties is also sparse or outdated. Often marketed to single, “young professionals”, anecdotal evidence suggests that this means just about anyone who can’t afford to put down a deposit on a flat or a house. That was the position Mike found himself in. Like many people living in HMOs, he was at the start of his career when he rented his room in North End, Portsmouth, bills included, for just £550pcm.

“People come and go,” says Mike, who had his room for three years and broadly enjoyed his experience. “It’s not a lie to say that some people are a bit dodgy. The vast majority of people aren’t. They’re just people looking for somewhere to stay, not permanently, for a good price.”

Eventually, Mike saved enough money for a deposit on a house 10 minutes walk away from his old room. He doesn’t believe HMOs bring anti-social behavior, recalling how he was too busy treading on eggshells around his housemates to even think about throwing parties or being noisy. But what they do bring, he concedes, are cars. “There’s an HMO in my street,” says Mike. “A normal house might have one or two cars, but in an HMO, you might have five adults living there [and] they could have five cars.”

That problem should have been mitigated by Portsmouth City Council’s (PCC’s) decree that no HMO should be officially sanctioned if more than 10% of the homes within 100 meters are the same property type. “We, as a group, are fighting for 5%”, argues Russell Simpson, a councillor for the Portsmouth Independents Party (PIP) and one of the most anti-HMO voices in PCC. Simpson’s constituents are aghast at their streets being choked off by traffic, but they’re also echoing concerns similar to those in Derby, Durham and Dover about anti-social behavior and the erosion of community spirit. Undergirding all this is a growing sense of bewilderment at how the planning system consistently favors HMO developers.

“If they don’t get planning permission, they can still build it,” says Simpson, referring to how landlords use “permitted development” rights to renovate their properties into de facto HMOs without having to consult the council — before obtaining a license to operate as a fait accompli. The resulting tidal wave in the north of Portsmouth, argues Simpson, has led to a breakdown in community feeling amid the churn of new residents, with at least one couple approaching him to say that their row no longer feels like a “family road” but “broken.”

But where, then, do you put those people who need affordable housing? HMOs are the only answer right now, argues Martin Silman — but that’s not something the council wants to hear, says the chair of the Portsmouth & District Private Landlords Association (PDPLA). Instead, says Silman, the PCC has increased the regulatory burden for landlords, pushing what he estimates to be 1,500 rooms off the city’s rental market and the most vulnerable residents into emergency accommodation. Worse, certain councillors have actively whipped up animosity against both tenants and landlords by encouraging anti-HMO protests in the public gallery during planning meetings, and even going as far as to tell one developer in the same forum that she should “hang her head in shame.”

The atmosphere grew so feverish last year, says Silman, that the PDPLA chairman warned that a “potential HMO Kristallnacht” against landlords was in the offing. After facing down calls to resign for the comment, Silman says the rhetoric on HMOs from the council has cooled. Even so, he says, residents and councilors still “talk about mixed and balanced communities, and what they mean is, ‘We don’t want anyone not the same as the rest of us,’ which isn’t ‘mixed and balanced.’ It’s just the label gets hidden behind.”

Silman’s concern stems from his claim that a disproportionate number of HMO tenants in Portsmouth are foreign-born. Just how far such hostility might go can be seen in the apoplectic protests against some of the estimated 6,000 council-run HMOs for asylum seekers. Angry opposition to one such property in Millom, Cumbria, led to a ban on new licenses, but not before “NOT WELCOME SCUM” was daubed on one of the properties being converted, with a builder’s tires slashed too. In Wigan, meanwhile, locals complained that a surge in HMO development by companies contracted by the government to house migrants was making it a “dumping ground” — a sentiment seized upon by Reform’s Nigel Farage who, ever-eager to personify the threat he sees in the massive rise in net migration in recent years, echoed accounts from residents in Dover about bedsit-dwelling foreign men loitering in their streets and stalking their children to school.

Similar levels of hostility to privately-run HMOs seem to be percolating in Portsmouth, says Alwin Oliver, himself a landlord. “I haven’t seen anyone directly concerned about the color of somebody’s skin,” he says. “I think it’s a lot more subtle. It may even be unintentional… but, for example, we’re seeing people write objections to [an] HMO at planning stages because they believe that the people are going to be pedophiles, or what have you. And that kind of labeling, and stigmatizing, of HMO tenants, is at its most insidious when most of the people living in HMOs are born outside the UK.”

For his part, Simpson thinks these insinuations from Oliver and Silman are nonsense, a “made-up narrative” crafted to “dismiss and dilute [the] real concerns of residents” (a planning consultant for developers I spoke to also disagreed with the premise that most HMO tenants in Portsmouth were foreign-born). Such arguments certainly appear to be a leap when sifting through planning objections on PCC’s website. While many do mention safeguarding concerns about HMOs near schools and the demise of “mixed and balanced” communities, those points seem more inspired by the petitioner’s general gut feeling about the HMO tenants as itinerant wrong’uns, usually found at the bottom of a long list of complaints about unwanted pressure on local services.

For his part, Darren Sanders hasn’t heard any xenophobic comments against HMO residents. Meeting me in another small back room in the council’s oversized offices, the PCC’s Lib Dem cabinet member for housing, and an HMO tenant himself, carries all the garrulous charisma of an old pol, sympathizing with all sides of the debate while committing fully to none. Case in point: on the one hand, the role of HMOs in Portsmouth’s housing stock is “significant”, Sanders says, with many people unable to afford anything else. On the other, council inspections of licensed HMOs between 2018 and 2020 found that 32% of HMOs surveyed had “Category One” hazards — fire risks, black mold, structural defects and the like — compared to 12% in the broader rental market.

The problem, says Sanders, is that there’s little alternative to HMOs for affordable housing in Portsmouth. Not only did the government recently turn down an 850-home development in Tipner West: the site is, apparently, an irreplaceable haven for black-tailed godwits. Whitehall also raised the council’s housing target — an impossible diktat because, given the lack of space to build on Portsea Island, “we frankly don’t know where to put them.”

So, the council has tried to mend and make do, spending £100 million last year to buy back 570 council houses and convert them into council-run flats. It’s also trying to use its mandatory licensing framework for HMOs to favor good landlords and punish bad ones. But those efforts tend to be lost in public outrage at the planning system’s apparent sympathy with developers over and above residents. Sanders also claims that pushback on proposals by councillors is also discouraged by council bureaucrats. “I left the planning committee,” he says, “because I was told by the planning inspector that I didn’t know planning law, and if we carried on as the committee doing this, we’d get fined — even though, sometimes, you look at an application and imagine, ‘This isn’t a good place to live in.’”

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Jen, who speaks to UnHerd using a pseudonym, has heard it all before. A resident of North End since 2017, she lives with her son and his partner on a street with five HMOs, one next door to their own house. As we chat in a near-empty Costa, Jen laments how one bedsit after another have been built in anticipation of guaranteed planning approval, and how her row is now so choked with cars that she’s afraid to drive to see friends and family outside the city for fear of returning to a parking space three streets away and a long, painful walk home on her arthritic knee.

“They seem to be able to do stuff for people to buy, but not cheap enough to help people get on that ladder if they’re in these rooms,” Jen says. She also worries about her son and his partner, who can’t afford a flat of their own, while the value of her home is declining. In the meantime, things keep getting more tatty, more expensive, more cramped. And Jen’s getting angry.

“My issue is the way people are treated in them,” she says of HMOs, though she’s afraid that the conversation about them could easily get hijacked by residents with bigoted agendas if action isn’t taken. “I have said to the Labour [MPs] office that, very soon, I will look at a city-wide thing, to try and bring everyone together and fight it that way. But, I am concerned that [there] would be people that are fighting for the wrong reason.”

The trouble is, nobody seems interested in actually building the kind of homes HMO tenants can afford, let alone want to live in, with successive governments seemingly incapable of setting targets for affordable housing and housing in general that actually satisfy demand. Absent new houses, the money to build them, the transport infrastructure to knit them all together, and the bloody-minded will to slash through a planning system that rewards NIMBYism over necessary development, the rental market will adapt by reaping ever-greater profits on ever-smaller spaces — and leave residents, councillors and landlords continuing to blame each other for the squeeze.

As I turn onto the slip road to the M27 and switch the radio on to another asinine panel show, I think about what Jen says about not being able to see a dentist anymore, or her GP, or if there are children in the rooms next door now that she’s seen a couple of toys for sale in the front garden. I think of frogs swimming in a saucepan. My reverie slips when I spy a broken-down SUV on the hard shoulder. Metres away, a woman in a traffic warden’s uniform sits with her head in her hands.

Labour’s primary economic goal has been reduced to avoiding US tariffs and scoring a half-cocked half-trade deal with Trump. In a bid to appease the President, the government will likely jettison the Digital Services Tax, levied on 2% of US Big Tech revenues here and bringing in $700 million a year — an all-but direct transfer from the UK’s poorest to Mark Zuckerberg’s pockets. Moreover, Starmer has funneled money away from welfare and towards a supposedly Trump-pleasing increase in defense spending. That’s while the Government’s own figures show that 250,000 more people, including 50,000 children, are expected to be pushed into poverty by the end of the decade. When Starmer says “everything has changed”, like Prince Tancredi in The Leopard, he is making sure everything stays the same.

Perhaps he thinks this will help Britain avoid “jumping into a trade war” — as if he had much say in the matter. If you don’t want to fight a war and someone else very much does, you will, by default, lose.

And his government has won strikingly little. Britain gained no special treatment, compared to any other large economy with a US trade deficit. Brazil and Australia, for example, both had the same 10% tariff applied. The crude, mechanical formula the Trump administration used to calculate tariffs was levied on the UK the same as almost everywhere else. Canada and Mexico, two countries whose leaderships have been notably more forthright, won a relative reprieve for negotiations.

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Contrast this unhappy island with the peculiar joy that has been overflowing the banks of the Spree. Following Chancellor-in-waiting Friedrich Merz’s announcement of a dramatic, debt-funded expansion of government spending, there has been a sudden, electric transformation of Germany’s possible economic fortunes. The cracking of the postwar European security system, somewhere between JD Vance’s speech in Munich and Volodymyr Zelensky’s dressing down in Washington, has provoked a deep recalibration of priorities across the continent. Germany must become, in Merz’s words, “independent of the USA”.

A consensus has incinerated Germany’s dogged commitment to the debt brake that had been promoted to a hallowed status. In a deal with the Christian Democrats and the Social Democrats, the one-time radical peaceniks in the Green Party are now happy to nod through an immense expansion of the Federal military budget with the questionable promise of a few more EV charging points. A split in the Left Party dotted the umlauts. Undesirables to the Left and Right shoved to the margins.

For 15 years, austerity has seen Germany banging its head against a fiscal wall — and it feels great to stop. After the government pledged for “whatever it takes” on defense spending, the Frankfurt Stock Exchange soared, led by arms manufacturer Rheinmetall whose share prices were up 140%. A further half a trillion euros has been set aside for domestic investment and some social spending, in the hopes of repairing the country’s crumbling infrastructure. Germany’s once-famed railways have got so bad that the US Department of Defense issued a complaint about delays in moving materiel to the Ukrainian frontline. Altogether, Germany is pledging more borrowing and spending than Reunification, and the Marshall Plan, the two foundational moments in the construction of its modern economy. This is a serious, genuine, 180-degree shift in orientation. Trump’s tariffs have only underlined the need for a recalibration.

While Trump’s re-election has transmogrified Germany’s fiscally constipated Christian Democrats into partisans for debt-fueled military Keynesianism, the opposite has happened in Britain. It has warped the Labour Party into steely-eyed austerians more than prepared to trim the supposed fat of the British state for the benefit of British Aerospace’s profits. Starmer is targeting an “overcautious, flabby” government for cuts beyond the brutal slicing of welfare. Labour ministers will point to Reeves’ tax-and-spend first Budget, in October last year, and claim that this new enthusiasm for the fiscal knife isn’t austerity. But last year’s sudden £70 billion flurry of generosity will not make any noticeable difference to the 800,000 Personal Independence Payment claimants, who are now losing on average £4,500. This is austerity, with a vengeance. But it is Labour austerity: cynically trying to buy off a few potentially noisy complainants in the public sector unions while shoving those without an institutional voice under a Motability car, all justified in the name of “security, dignity and agency”.

Starmer may not care too much. The Prime Minister’s various international appearances since January have been greeted with a chorus of happy barks from Britain’s commentariat. His first six months after his election victory saw him thank the country by spending an extraordinary amount of time out of it: and he clearly would rather strut around the international stage than grub around in the murk of Workplace Capability Assessments. It is not clear what his plan to win the next election might be.

The generous interpretation is that Starmer is playing to his strengths, and that his diplomatic efforts since last summer are now producing dividends in his close relationship with Trump. But handshakes in Washington do little for local elections, such as in Runcorn where the party expects a Reform victory in a once-safe seat. Defense spending, which is increasingly tech- and equipment-focused, has (as government assessments show) limited impact on jobs. The content and purpose of the planned increase in defense spending remains unclear. Pointing at Russia and making scary noises do not actually constitute a strategic plan. Britain’s military, and its notoriously wasteful contractors, have been gifted a blank check.

Labour has decided to remove one of Britain’s actual advantages in the world by chopping its significant foreign aid spending. Humanitarian costs aside, the hard-nosed calculation ought to have been that soft power can be leveraged in a world in the near-future where the Global South will matter more, and the old West far less. Britain’s “coalition of the willing” is anything but: those European countries pledged to Ukraine’s defense are locked in mutual disagreement over how, and even whether, to provide military support for any peace deal.

And, as everyone who has ever dealt with Trump discovers, a personal pledge at lunchtime can become a vitriolic tweet by midnight. Choosing to align so closely with a regime that views uncertainty as a weapon and treats all relationships as purely transactional is an invitation to failure. There are, it is true, hard economic reasons that encourage Starmer’s attitude: outside the EU, with few friends in the world, lumbering around with failing institutions, a stagnant economy, and some extraordinary external liabilities, the country’s elite may see few options beyond supplication. The Government’s notional opposition agrees: both the Tories and, even more so, Reform, offer no alternatives beyond national forelock-tugging with more or less enthusiasm.

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But that doesn’t mean other options don’t exist. One Euro-optimistic vision, towards which the world’s stock markets have been pointing, is a prolonged period of turbulence and lower growth in the US. As the Trump administration tears out the wiring of the global economic order, big money flees frightened by rumors of capital controls and the reality of on again, off again tariffs. Already The Telegraph reports America’s ultrarich are rushing to open Swiss bank accounts. As Trump’s America slides, Europe, led by a freely-spending Germany, attracts the investment; relations with China are normalized, trade accelerates; the war in Ukraine at least paused. Where once US growth meant European prosperity, that link has now shattered: in Trump’s first decade as a national political figure, a soaring US, floated aloft on cheap gas and demand for dollars, was mirrored by a stagnant Europe. If recent stock prices are any guide, we have been heading for a reversal: US flatlining, European growth.

It is certainly too soon after the tariff shock to make robust predictions, and too soon to declare that Europe is heading for a rebound. Already the fiscal strains of the attempted rearmament drive are beginning to show, and the EU’s infrastructure pledges do not meet even the requirements detailed in Mario Draghi’s blockbuster report last year. A 20% US tariff will be hard going, even if the EU has a meaningful capacity to retaliate, and to negotiate. But it is plausible to think that the era of “American exceptionalism”, of its uniquely rapid growth in a stagnant developed world, may well be over. And Britain, on current showing, is going to find itself on the wrong side of that Atlantic divide.

Britain’s economic fundamentals are substantially worse than other, similar economies. Our weakness when it comes to productivity growth, the size of government debt, and our import dependencies for essentials such as food and energy means that we have fewer options. Or rather few options that would not now involve seriously challenging power and wealth in this country. Calls for a wealth tax are growing. The absurd, £130 billion hand-out to the Bank of England “losses” is finally attracting political attention — although among national parties only Reform has been brave enough so far to call for its removal. The Treasury itself could finally learn to invest outside London and the southeast. If everything has changed, everything must change.

Seeking to combine the image of a radical reformer with the reputation of a safe pair of hands, Reeves began her litany of mixed messages before she moved into 11 Downing Street. While she acknowledged the “severe damage” inflicted by George Osborne’s austerity program, she adopted his language to liken Britain to a person who had “maxed out the credit card”. Then, once in the Treasury, she demonstrated how using such language leads inexorably to a contractionary fiscal program. Turning John Maynard Keynes’ dictum “Anything we can actually do, we can afford” into its opposite (“If we cannot afford it, we cannot do it”), Reeves embarked on an austerian downward spiral.

First came expenditure caps on caring for the elderly, which would save the measly amount of £1 billion annually. Having warmed up, she followed with the termination of winter-fuel payments for pensioners, shortly before one of recent history’s coldest winters. Along with cancellations of urgent hospital and railway works, these cuts saved another £5 billion, with a further £16 billion tax rises in the works. Then, in her autumn mini budget, Reeves broke her promise not to touch National Insurance Contributions by extracting an additional £25 billion from employers. Hoping to frame this final measure as pro-labor, her tactic fell terribly flat once workers realized they would be paying for most of it in the form of dampened wages.

By that stage, the new Chancellor was caught in the same doom cycle that typified Osborne’s tenure: each austerian measure meant to rein in the deficit boosted the borrowing requirement, spooked debt markets, elevated interest payments, reduced its fiscal space and caused the Chancellor to seek more austerian measures. These, in turn, deepened the economy’s stagnation. And so it would go on.

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Tory critics have taken Reeves to task for being too ready to talk Britain down. But they seem to have forgotten that her claim of inheriting a £22 billion black hole from the Tories was a faithful imitation of Osborne’s strategy to blame his own austerity program on the “scorched earth” situation he had inherited from Labour. The Tories have also accused her of being insufficiently austerian, which is disingenuous: if deeper austerity were the right remedy, why was the doom loop under Osborne just as bad? If anything, deeper cuts in expenditure today would only worsen Reeves’s predicament.

Obviously, the Tories are trying to exploit Reeves’s woes. But what is truly startling about her stewardship of the Treasury is both how faithfully she has stuck to Osborne’s playbook, and how similarly the UK economy has reacted. And this despite the quite monumental difference in the circumstances the two Chancellors faced as they took office. Soon after his appointment, Osborne received a windfall from the Bank of England — in total, £124 billion was transferred from the Bank of England to the Treasury between 2010 and 2020. In sharp contrast, Rachel Reeves will be sending to the Bank of England £34 billion of taxpayer money every year for the next four years. Essentially, all the money her austerity raises will be sent to the Bank. And all because of a flawed set of monetary rules which she is refusing to change.

This madness all dates back to the financial crash and the subsequent fallout when, in addition to the taxpayers’ bank bailouts and ultra-low interest rates, the Bank of England created £875 billion to buy government bonds from the bankers. It flushed the banks with cash that they would then hand out in loans to stressed households and firms. In the process, the Bank of England made money from the interest rate difference — between the ultra-low official interest rates it was paying banks and the higher interest accrued by the government bonds. Hence the £124 billion windfall for the Treasury.

However, the situation was reversed after 2022. With the pandemic disrupting supply chains and triggering inflation, the Bank raised interest rates tenfold and began selling the government bonds back to the bankers in the hope that prices would stop rising. But bonds come with fixed interest rates. And by raising interest rates, the Bank of England had effectively pushed down the value of the older bonds it was selling off, thus inflicting large losses on itself.

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These losses could have been avoided in two simple ways, reflecting the wiser practices of other major central banks. First, it could refrain from selling government bonds at knockdown prices — and instead hold them to maturity. Second, it needn’t pay bankers the high official interest rate on every pound they choose to hoard at the central bank.

Indeed, many leading central banks pay the bankers the going interest rate only for part of their deposits, the rest at zero. This is precisely how the European Central Bank (which, by the way, no one can accuse me of being a lackey of) avoided major losses when deflation gave way to inflation. There are no good arguments for why the Bank of England should not follow the ECB’s example — except that the City bankers would not like it. And only a cowardly Chancellor would think this was a good enough reason to maintain a £34-billion subsidy for the banking sector every year.

Given the Bank is supposedly independent, some may ask whether Rachel Reeves is really to blame. But the issues at stake are in the remit of Parliament: the mindless fire sale of government bonds; the high interest accrued to bankers’ money; and, most crucially, the assumption, first promised by Philip Hammond, that the taxpayer would indemnify the Bank of England for whatever losses it might suffer. These fall under the Chancellor’s responsibility. And given that it is her duty to legislate for the common good, she could change them.

Just look at Reeves’s predecessors. Before Philip Hammond’s promises, George Osborne and Alistair Darling legislated that the Bank of England could print money for the bankers but not for households — against the advice of the not-exactly-Leftist IMF. And now Rachel Reeves has decided not to legislate away the stealthy BoE subsidy to the bankers, adopting instead their inane, self-evidently self-serving arguments. Chancellors, in short, cannot hide their responsibility behind a distortion of the notion of central bank independence.

Taking a broader perspective, ever since Margaret Thatcher vandalised Britain’s ailing heavy industry and replaced it with a vicious financial system, it was only a matter of time before a global financial crisis would bring Britain to its knees. Following the 2008 crash, overgenerous money printing for the bankers and austerity for everyone else trapped the UK into a low-wage, low-productivity, low-growth, low-take-home-pay, low-rent equilibrium. That is why, for a while now, Britain has felt like an advanced rentier society that has run out of rents.

But let’s be honest. Labor was never going to fix Britain’s broken business model. Nothing in their manifesto warranted any such hope. Nevertheless, it isn’t too much to expect minimal levels of competence and enough courage from a new Chancellor to rescind an annual handout of £34 billion to bankers already flush with taxpayer cash. Alas, overpowered by an urge to be accepted by the City, Blackrock and the Davos crowd, Reeves has fallen into a trap of her own making.

John Kenneth Galbraith once quipped that “[t]he process by which money is created is so simple that the mind is repelled”. Today, it is hard not to be repelled by how Britain’s scarce fiscal resources are sacrificed on the altar of the Chancellor’s cravenness.

Yet in the chilly winter air outside, there’s also a desolate scene, one that wouldn’t be out of place in Dickens. After years of industrial decline, to say nothing of growth-squashing policies from Whitehall, the erstwhile home of Joe Chamberlain has become a stronghold of homelessness. You see them loitering by the station, weather-worn and battered, wandering alone or in small groups. Many sit in tired, ad-hoc conflabs. Some cadge fags or cash. Others share gossip, jokes, or a less-than-ideal bit of shelter. And just as the streets around New Street suffer here, so, all Birmingham does too. 

Since 2019, there has been a 70% jump in homelessness across the city. The most vulnerable rough sleepers, those near New Street, are only the start. There are now over 10,000 homeless children in Birmingham — more than at any other time this century — with over 4,500 families in temporary accommodation. 2023 government stats show that the West Midlands has much higher homelessness rates than the East Midlands (Nottingham and Leicester) and the North West (Liverpool and Manchester). Barrie Hodge of St Basils, a local youth homelessness charity, says those seeking help from the  have rocketed by 22%. 

Ask the average worker, rushing to and fro from New Street, and most won’t give the homeless a second glance. This is not because we’re a callous lot — it’s because we’re used to this scene and many here, too, are struggling to make ends meet. Rent rises in this corner of England are among the fastest in the land, even as employment is down, and less than a quarter of us earn the London median wage of £44,370. Many here just don’t have the cash to help themselves, let alone pass on a fiver to some nameless stranger looking for a handout as they rush to get a train.

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Visit Council House, the handsome Victorian headquarters of local government, and you’d probably hear a similar answer. Max Caller, called in by Whitehall after Birmingham’s effective bankruptcy, has been locally dubbed “Max the Axe” for his ruthless pruning of the city’s spending. The exact figure changes a lot, but hundreds of millions have to be found in cuts, or in council tax rises. Not that it’s surprising. Between financial mismanagement, a botched IT upgrade and an eye-watering equal pay settlement, Birmingham is a city on the edge. Beyond the £400 million headline, which has seen arts funding taken down to zero, and social care slashed. For its part, funding for the department that deals with homelessness has seen cuts of 28%.

You can see the paucity of authority care throughout the city. Beginning at New Street, it’s crept up the A-roads and down our arterial waterways. On canals you’ll find tents. Some are for sleeping; others for shooting up. On major ring roads, traffic lights are increasingly guarded by the most desperate. Suburban retail parks are much the same. For their part, some bus stops are also now homes. One homeless lad, at the Highgate interchange of Belgrave Middleway, had been there for so long that he’d even started tending to the weeds around the road’s intersection. Add to that the mass of people in temporary accommodation, hardly suitable for building stability or accessing consistency in care, and the problem is becoming more complex. “Society,” Hodge says, “is only as successful as the way it treats its most vulnerable.”

Given the desperate state of Birmingham’s accounts, it’s tempting to imagine that these problems could be solved with more cash. But with Rachel Reeves making much of Labour’s tough decision-making — she recently said all government departments need to find 5% in cuts — a wholesale abandonment of austerity seems unlikely. That’s even as the city currently spends about £2 million a month on temporary accommodation for the homeless.

To be fair, the Government isn’t totally oblivious here. Treasury grumbles notwithstanding, Labour has promised an extra £3 billion to build new houses. Beyond opening its wallet, Whitehall also plans to deregulate. All local authorities in England will soon boast “spatial development” strategies, while mayors will be able to take planning decisions without asking London for permission. These carrots come with sticks. Angela Rayner has made much of the mandatory housing targets Labour is set to impose on councils, with local leaders expected to identify ugly greenbelt land (the so-called “greybelt”) for new projects. If places like Birmingham still drag their feet, No. 10 has ultimately promised to overrule them.

These efforts are surely welcome — but in truth risk ending in failure. For starters, the social housing waiting list in Birmingham alone is 23,500 at the last count, and that excludes the 10,000 just waiting to get on the waiting list. Labour’s annual plan to build 300,000 houses nationwide suddenly sounds rather less impressive, especially when combined with immigration figures that, though falling, remain high. Another challenge involves money. It’s all good and well to pump billions into housing, but recall that councils now spend 42% less on services than they did in 2010. Then there’s the question of expertise: Birmingham finished just 40 council-developed units, leaving officials reliant on pricey (and dubious) HMO landlords. Ebenezer Scrooge: is that you?

Solutions are available. Birmingham has the highest number of empty homes in the country. Some of this is due to landlords or owners not being able to afford repairs. But near to where the cash-generating Commonwealth Games were held, hundreds of premium flats, meant first for athletes then locals, remain empty. More council mismanagement. And though elsewhere the council has clawed back control of other empty flats — the aim being to reduce homelessness and ease housing congestion, as well as stopping properties from being used for anti-social behaviour — could cash from the Treasury buy these up faster, mitigating future costs and helping those at risk of homelessness? There is, at least, a blueprint here. In 2020, as Covid-19 took hold, all street homeless were housed within a week, when unused hotels and hostels were suddenly converted to temporary accommodation.

Ultimately though, beating homelessness is about more than immediate tweaks. “The easiest part is putting rooves over heads,” Hodge says. “The hardest part is helping them [homeless] with the realities of life.” Left to their own devices and multiple occupancy residences for the homeless risk being ghettoised, defined by sex work and drug use. Experts like Hodge are eager not merely for more money — but also the targeted prevention of homelessness at source, and the good work and life opportunities to help people get back on their feet. That makes sense: though a lack of council cash is doubtless a push factor for those rough sleepers near New Street, there are pull factors too, from addiction and family breakdown to the cost of living. 

While he therefore wouldn’t sniff at more funds from Council House, and appreciates whatever help he can secure from Victoria Square, Hodge equally wants more thoroughgoing social change: boosted wages; better-paid apprenticeships and entry-level work; salaries in line with rocketing retail rents. These, he says, are the improvements that prevent homelessness in the first place. “Otherwise,” he warns, “you end up throwing money at the problem. It’s like smoking: we have to highlight the risks and hope to prevent [homelessness], but that means the government putting money into something that might not get immediate results.” 

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For their part, Birmingham City Council’s leadership should start being louder. Certainly, local engagement can work: Greater Manchester has recently reduced street homelessness by 52%. In practice, that’s involved a “Housing First” programme to deliver long-term accommodation, and a “Bed Every Night” scheme for more urgent cases. Beyond the specifics, moreover, you get the sense that political engagement can really help here. Yes, Birmingham has an ambitious five-year council plan to reduce homelessness, as well as partnerships across the city. Then again, the only local councillor who dared condemn Caller’s cuts was promptly suspended. More to the point, pressure on Whitehall has proved successful elsewhere. Up the M6, Andy Burnham has been central in lobbying for more central government funding to boost homeless schemes across his combined authority.

Courage from Council House is doubly urgent now. Top homeless charities have written to Reeves to explain that homelessness could rocket still further. And while Lisa Nandy talks a big game on the need for charity, the Secretary of State for Culture, Media and Sport sounds ominously like she’s merely regurgitating “Big Society” nonsense of the Cameron era. “The charity sector can pick up the gaps but that’s because statutory services were not supporting or funding services,” is how Hodge puts it, noting that much of the sector’s funding anyway comes from local government. Considering how serious the problem has now become — not just here, but nationally, with over 300,000 people now assessed as homeless — it’s hard to disagree. 

Something, in short, must clearly be done. Especially now, as winter hits, and the homeless in their sleeping bags begin to shiver. Officially, after all, there are now 36 entrenched rough sleepers in the city, and these figures are bound to rise further. In the winter chill, I walk past one man wearing clothes barely more than rags, with a battered sleeping bag scarved around his neck. He’s hunched over, looking for nubs of used cigarettes on the floor. A charitable fiver from a fellow Brummie feeling “good will to all men” might help for a time. But something more substantial is needed too, long after the Christmas lights come down.

But despite these promises, Americans are likely in for a period of consumer austerity no matter who wins the election. The only question is what form this austerity will take.

In somewhat simplified terms, the fundamental policy choice is between conventional or “neoliberal” austerity, progressive-environmental austerity, and what might be called “catch-up reindustrialisation” — a policy shift in favour of investment over consumption to rebuild the US industrial base and shore up America’s long-term security and economic prospects, particularly vis-à-vis China. In my view, the third option is both the necessary and most desirable choice, yet all three present their own difficulties and complications. The fact that all these choices involve some level of austerity doubtless contributes to the increasing bitterness of American politics.

Let’s start by considering neoliberal austerity. Conventional budgetary concerns have resurfaced with the inflation spikes of recent years and interest rates still near their highest levels since 2008. In the past, deficits significantly above 3% of GDP were only experienced during major economic downturns or in wartime. In 2023, however, the United States ran a roughly 6% deficit with a relatively low unemployment rate of around 4%. While paranoia about the US national debt has always proved baseless in the modern era, the limits of the present trajectory are becoming more visible, as interest payments take up greater and greater percentages of government spending.

The question for deficit hawks — today and in the past — is whether they are in fact primarily concerned with reducing the deficit. In America, this pose is often, if not typically, disingenuous — rhetorical cover for an ideological project of shrinking the state rather than responsibly balancing revenues with expenditures. Hence the most strident deficit hawks are almost invariably the most eager tax cutters. Or, perhaps more accurately, the most aggressive tax cutters often masquerade as deficit hawks but have little real interest in responsible fiscal policy.

Today, with federal tax rates at low levels, any serious deficit reduction programme would have to consider tax increases. The rates themselves may not even be the key issue: taxing corporate profits in the country where they are earned, or closing various personal loopholes, may have a greater impact at this point. But these items are largely excluded from the “deficit” agenda, especially among Republicans, who continue to indulge in fantasies that tax cuts will “pay for themselves”, despite the manifest failure of the Bush and Trump tax cuts to generate meaningful growth.

Instead, the conservative focus remains entirely on cutting spending. The problem here is that, within the realm of political plausibility, there is not all that much to cut. According to the most recent numbers from the Congressional Budget Office, “mandatory spending” (mostly Medicare, Medicaid, and Social Security) accounted for $3.8 trillion of the $6.1 trillion 2023 federal budget. Defence spending added another $800 billion, constituting almost half of “discretionary spending”. Interest costs were an additional $700 billion, contributing to a total deficit of $1.7 trillion. The bottom line is that, even if all $900 billion of non-defence discretionary spending were miraculously cut — zeroing out transportation, education, veterans’ benefits, the justice system, and scientific research — that would only reduce the deficit by about half. Significant deficit reduction must therefore involve cuts to the most politically sensitive areas: defence and entitlements.

Given China’s emergence as a peer competitor — and one with a massive industrial-base advantage — cutting defence appears to be off the table. On the contrary, the ranking Republican on the Senate Armed Services Committee, Roger Wicker, has proposed increasing defence spending to 5% of GDP, up from the current level of 3%. The reasons are clear: China built 21 submarines last year, while the United States struggled to build one; it will take up to seven years to replenish certain munitions stocks used in Ukraine, and analysts estimate that the United States would be out of some critical weapons within a week in any active conflict over Taiwan. One reason the US Navy has not been able to better protect Middle Eastern shipping lanes from recent Houthi attacks is a concern that the increased use of certain munitions there would compromise readiness for other potential conflicts.

Simply throwing more money at the Pentagon and incumbent defence contractors will not solve these problems: serious procurement reforms and broader industrial policy measures are necessary. And yet there is little doubt that America’s security situation is more perilous than it has been for generations. Legacy ideological commitments further complicate these issues. The most aggressive “deficit hawks” — such as Nikki Haley in the Republican Party or various centrist Democrats — also tend to be the most fervent supporters of interventions in Ukraine and elsewhere to uphold a “US-led liberal international order”. Although Haley and others typically prefer to imagine that foreign policy and economic policy are distinct domains, their interventionist commitments nevertheless preclude any significant cuts to defence spending.

That leaves Social Security and Medicare. Cutting Social Security is so politically toxic that Trump has completely distanced himself from the proposals of George W. Bush and Paul Ryan, once hallmarks of conservative economic policy. Republican congressional leadership also notably refused to endorse entitlement cuts in the last midterm elections. Even if Social Security cuts were politically viable, however, there has been little serious effort to think through the effects.

Significant cuts would mean workers would have to defer their own consumption, either to save more for their own retirement or to keep their elderly parents out of poverty, creating a drag on growth and complicating deficit reduction efforts. Although Social Security is structured as social insurance rather than welfare, the benefit formulas are somewhat redistributive, so major cuts would probably result in a further shift of wealth from lower-income people, with a high propensity to spend, to affluent savers, with a lower propensity to spend.

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In the past, advocates of “privatising” Social Security sometimes argued that allowing individuals to manage their own retirement savings would enable higher returns and boost growth. But the Social Security programme functions less as a professionally managed pool of capital, like the public pension funds common in many other countries or in US states, and more like debt-funded consumption stimulus. Eliminating Social Security, therefore, is not simply a matter of distributing a pool of assets to individual accounts. Furthermore, if the goal were simply to maximise returns, the Social Security “trust funds” could be authorised to make public and private investments beyond US Treasury securities. But the same small-government ideology that calls for cutting Social Security also resists giving the government the authority to make such investments, which could distort “market signals”. Devolving all responsibility to individuals, on the other hand, would magnify the impact of market volatility for each household and likely require further increasing savings. At the same time, the government would probably still be called upon to bail out retirees — whether they saved prudently or not — during major stock market crashes.

A more practical approach might aim to maximise the value derived from the existing programme rather than cutting it. Senator Vance was roundly criticised for saying that more should be done to enlist grandparents to assist with childcare. Yet there are a number of serious proposals to use Social Security to incentivise childcare or otherwise better support the sharing of resources within extended families.

The other major area perpetually on the chopping block is health care. This would appear to be more fertile ground: the United States spends 17–18% of GDP on health care, by far the most in the world, to achieve overall public health outcomes that are decidedly mediocre. Spending on health care programmes composes about a quarter of the federal budget. Surely, the system could be more efficient?

The problem, once again, is that ideological motivations are at odds with practical solutions. Those most eager to cut health care spending tend to be those most committed to “market fundamentalist” ideology, who tend to ignore the possibility that increasing state intervention might be necessary to control costs. But marketisation, in practice, has generally failed to control costs and, in theory, there is little reason to expect that it should. As the economist Kenneth Arrow demonstrated back in 1963, normal market dynamics do not apply to critical aspects of health care. Ordinary competitive and pricing dynamics are often absent, and the sector is characterised by deep information asymmetries and network effects.

The irony is that even practical incremental steps to reduce health care costs, such as government negotiating prices with pharmaceutical companies or hospital monopolies, or better regulating parasitic middlemen such as “pharmacy benefit managers” (PBMs), are generally resisted by the same people who claim to be most concerned about reining in spending. As a result, “marketisation” in the US context has simply meant a refusal to employ the state to control costs, contributing to a cycle of expanding subsidisation.

In sum, the concerns of deficit hawks are real enough when it comes to health care, Social Security and defence, but the politics around these concerns remain insincere and ineffective.

A similar pattern prevails in progressive environmentalism, another sphere in which legitimate concerns have been pressed into the service of a counterproductive politics. In the United States, unlike in Europe, true “de-growth” austerity has become so discredited that most politicians have run away from it, though the impulse still exists among many NGOs and activists. Yet even if American progressives, for the most part, are not looking to shut down modern agriculture, discourage having children, or revert to hand-washing their laundry to stop climate change, they are eager to restrict consumer choices and divert public resources to promote renewable energy and electric vehicles. The Inflation Reduction Act, which includes most of the climate-related subsidies passed during the Biden administration, is estimated to cost somewhere between $800 billion to $1.2 trillion over 10 years. The actual cost is unknown, because some of the IRA’s tax credits are uncapped and theoretically unlimited — but the “energy transition” is certainly expensive.

The necessity of such costly carbon reduction efforts is often presented as beyond ordinary politics — only pathologically greedy science-deniers would oppose taking action to avert a global climate emergency! Yet while environmental concerns are seemingly universal, the environmental movement remains deeply partisan. There is no getting around the fact that climate activists frequently demand sacrifices from ordinary people while ignoring the behaviours of ultra-wealthy donors and displaying clear sectoral biases. The farmer, the coal miner, the exurbanite, and so on are all called upon to make difficult adjustments to meet various arbitrary emissions targets. But the billionaires who shuttle between multiple estates on private jets are never expected to change their lifestyles to save the planet, except perhaps to donate to the climate NGO complex. Wind and solar fields are supposedly essential — but not within sight of Nantucket. Fossil fuel companies are demonised, but tech giants whose server farms consume more and more energy are largely exempt from such criticism, as long as they make the right noises on ESG. Likewise, the environmental movement has fought to impose more and more regulatory burdens on manufacturing and heavy industry, all while turning a blind eye toward pollution offshoring to China and elsewhere.

In fact, the history of the American environmental movement and its political alliances is rather sordid. In its earliest days, environmentalism was associated with population control and even eugenics. After rebranding as an emissions control movement in the second half of the 20th century, environmental groups first teamed up with coal and utility deregulators against nuclear power. Then they took money from natural gas and Enron for campaigns against coal. Recent years have seen a turn against all fossil fuels, though nuclear has once again been grudgingly readmitted to the decarbonisation push. Ironically, the most significant opponents to new renewable energy construction are often legacy environmental groups, who helped construct a legal regime in which it is relatively easy for third parties to challenge any new energy installations on environmental grounds. This is one reason why far more solar fields have been built in red states like Texas compared to ultra-progressive states like California.

Beneath all the moral preening, then, the green movement is fundamentally just another interest group pursuing a relatively narrow, partisan agenda. It is, and always has been, primarily composed of affluent and professional-class individuals in “asset-light” corporate sectors, as well as opportunistic energy players. In many ways, it is the ultimate neoliberal coalition: a global, post-political orientation, overseen by technocrats operating through nondemocratic transnational organisations and financial markets.

To be sure, the fact that the environmental movement is a self-interested lobby does not necessarily mean that its core claims are false, even if some activists have engaged in alarmism and exaggeration in the past. Indeed, the absence of effective environmental policy is already imposing its own form of austerity, as seen in rising home insurance prices across the United States, to which climate change is almost certainly a contributor. Yet being right about some things does not make the environmental movement any less of a lobby.

Oddly, the green movement would probably have more success in the United States if it simply accepted its corporate-lobby character. Certainly, a movement that focused less on moral preening and NGO fundraising probably would not have made the mistake of trying to pursue decarbonisation while demonising nuclear energy for decades. It also might be more practical about encouraging the transition to clean energy and electric vehicles.

The current push into EVs, based on a combination of tax subsidies and state-level mandates, is already sputtering. Sales growth has slowed dramatically, and auto companies have shelved plans for new models. A more serious approach would recognise that the United States — unlike, say, Norway — is a large country with a weak rail network; people regularly drive long distances; and combustion vehicles’ rapid refuelling remains a significant advantage. At the same time, the United States — unlike, say, China — has little capacity to enforce top-down changes in consumer preferences and infrastructure construction. Two years after Congress appropriated billions for charging stations, not a single one has been built. A more practical agenda would have emphasised vehicles such as plug-in hybrids, which could have a major impact on emissions and would create incentives for the private sector to add more charging stations, while also appealing to consumers who desire flexibility. Such thinking, however, would require the green movement to abandon the pretence of moral purity and accept the compromises and coalitional balancing of any industry lobby.

The more likely outcome is the continuation of the status quo, in which lavishly funded NGOs persist in their attempts to push badly designed policy on a reluctant populace. Whereas neoliberal austerity is essentially an ideological movement trying to appropriate the rhetoric of economic interest, progressive environmentalism is a class- and sector-based lobby seeking to brand itself as a moral-ideological cause. Both will remain ineffective as long as they continue to labour under these self-delusions.

The third option is, for lack of a better name, catch-up reindustrialisation. As with environmental “austerity”, this does not involve conventional budgetary austerity — it may in fact require more public spending — but it does entail a shift away from maximising consumption and towards increasing investment in productive capacity. Trade measures such as tariffs intentionally raise prices, at least in the immediate term, while funding for industrial policies may come at the expense of other budget priorities.

The need for a serious industrial policy programme has become more pressing for various reasons. The first is national security. As discussed above, America’s defence industrial base has eroded considerably. By contrast, China’s manufacturing advantage is overwhelming, which has created supply-chain dependencies in a number of critical commercial areas as well. Surrendering sectors to foreign competitors often entails losing more than “commodity manufacturing”; it also means losing technological prowess and workforce skills. The United States need not look to dominate every manufacturing sector, but it will be impossible to fix the defence industrial base without improving the broader industrial base.

In addition, it is slowly dawning on American politicians that it is impossible to avoid having an industrial policy; the only question is whether to pursue one’s own, or to accept the imposition of someone else’s. China, in particular, by massively subsidising capital investment and export industries, has disadvantaged and discouraged investment in manufacturing and capital-intensive sectors in the United States. And by refusing to intervene, the United States has simply allowed Beijing to pick winners and losers.

Moreover, the fact is that, even without a self-conscious industrial policy, the US government has had to subsidise fallen national champions such as Boeing in recent decades. What has been missing is a serious plan to maximise the effectiveness of these investments, in large part because the post–Cold War neoliberal consensus precluded any open consideration of industrial policy.

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According to this conventional economic theory, industrial policy will always be inefficient, value-destructive, and a drag on growth because it interferes with market-driven capital allocation. If private-sector actors require government support or prodding to make an investment, the theory goes, then it must be a poor investment, even if necessary for non-economic reasons such as defence. These models assume, however, a form of economic rationality in which firms operate to maximise profits. In reality, firms operate to maximise shareholder value. The two may occasionally overlap, but they are not the same. As a result, firms often maintain hurdle rates well in excess of their cost of capital, and pursue financial engineering strategies instead of investment. This behaviour may be irrational in the sense of forgoing profits, but it is often eminently rational in the sense of maximising equity valuation. The net result, from a national perspective, is chronic underinvestment, particularly in capital-intensive sectors where foreign industrial policies drive down returns. This is one reason why the relationship between financial returns and productivity breakthroughs has always been more tenuous than standard models would predict, and why industrial policy can spur economic development by dislodging financial rentierism.

Government investment promotion, therefore, is not necessarily value-destructive. It may in fact enable investments whose returns, while below private sector hurdle rates, are still positive. These investments, in turn, can form the basis of new companies, technologies, and industries, as the many historical examples of successful industrial policies attest, from Korean autos to Taiwanese semiconductors to early Silicon Valley.

From this perspective, successful industrial policy is perhaps best thought of not simply as consumer austerity but rather as “deferred gratification”, or investment in the future. Notably, the Chinese government has actively suppressed domestic consumption in favour of industrial investment throughout the last several decades, and yet, contra Western economic orthodoxy, has presided over a miraculous rise in living standards, in addition to its growing geo-economic power.

That is not to say, however, that the path forward for the United States will be easy. On the contrary, American industrial policy faces a number of obstacles and complications. First, US government agencies have relatively little expertise in designing and executing industrial strategy, certainly when compared to their Asian counterparts. The US government itself is poorly structured for this end, with limited institutional capacity to integrate foreign policy and economic policy.

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Second, advocates of US industrial policy often have diverging goals in mind. Some focus on the defence industrial base, others on the “energy transition”, others on “creating jobs”. In a Venn diagram, these circles would intersect, but they are not identical. Such diffuse ambitions may impede both the passage and implementation of successful industrial strategy, as previous criticisms of “everything bagel” industrial policy have shown.

Third, the largest corporate and financial actors in the US are at best ambivalent about industrial strategy. They are deeply dependent on China, and are also prime beneficiaries of the “fissured economy” model in which intellectual property rents are separated from capital investment and labour. Furthermore, policies like the Chips Act passed in large part due to the support of incumbent industry lobbies, though policy design suffered in various ways as a result. It remains to be seen whether the United States can pursue industrial policy in critical areas that, unlike semiconductors, do not have powerful incumbent lobbies.

Finally, and perhaps most importantly, a critical ingredient present in the canonical East Asian industrial policy success stories is absent in the United States. Namely, the “Asian Tigers” each used global export markets, particularly the US market, as a competition check: companies that increased export share received more industrial policy support; those that did not were cut off. Without the export-market check, there is an increased temptation to subsidise “zombies”, rather than orient industrial policy investments toward improving productivity and competitiveness. US industrial strategy, therefore, may need to place greater emphasis on stimulating domestic competition. Another option involves using government procurement and investment to create milestone-based contests. In Operation Warp Speed, for example, the government offered contracts only to vaccine developers who met certain thresholds, such as Moderna and Pfizer. Unfortunately, such contracting models remain more the exception than the rule in US policy.

Thirty years after the end of the Cold War, it is clear that the United States squandered its unipolar moment, not only via quixotic foreign policy interventions but also through imprudent economic policy. Deluded by abstract and idealistic theories, American leaders offshored the country’s industrial base to what is now its greatest rival, in order to support debt-funded consumption and financial asset bubbles. The result is a new era of great power competition, massive public and private debt loads, and an economy dominated by software monopolies that have done little to improve productivity. In the next few decades, America will have to commit more resources to addressing these problems. If it fails to do so, an even more drastic austerity will eventually be imposed upon it, as an already strained empire collapses completely.

This, in its broad outlines, is now the unifying worldview of the Brics powers: a loose pact of frenemies  — currently assembled in the city of Kazan — with whom, according to General Sir Patrick Sanders, we are on the brink of war.

But 10 years ago, this was also nothing less than the official policy of the British government. Britain was the first country — not Russia — to follow multipolar world theory as a guiding principle: the term Brics was coined by the British economist Jim O’Neill, and the country would also produce When China Rules The World, the smash-hit prophecy of American decline. America may have started to “decouple” from China almost a decade ago, but Britain still looks to Beijing as its natural source of foreign investment, as David Lammy’s visit this week proves. To Britain’s governing classes, the collapse of Lehman Brothers in 2008 was decisive proof that American hegemony was finished, and that Britain could no longer live off the fat of its dividends. This global system had now crashed, and it wasn’t at all certain that the country would now be able to maintain the lifestyle to which it had grown accustomed.

The times called for a new savvy. Concessions to changing global conditions would have to be made. Some scruples, such as the precise domestic arrangements of trading partners, or rules on foreign ownership, would have to be put aside.

This was the political economy of Cameronism. Everyone agreed that Britain, especially now, was a genteel legacy power; and it would have to traffic in this legacy to eke out first-world living standards.

It would mean selling off the last of the stored imperial wealth. It would mean, still more, the relentless merchandising of British heritage brands abroad. If Britain could not win the new Brics powers for liberal democracy, then it might yet win them for Dulwich College, the House of Windsor, and Macallan single malt. The new oligarchs would stash their wealth at British banks; British lawyers and law courts would handle their commercial disputes. They would hunt its fields, fish its rivers, buy its townhouses, and educate their young at its ancient schools — so many of them, in fact, that by 2016 St Paul’s School, George Osborne’s alma mater, would have to introduce a special bursary for the upper-middle classes as fees ballooned.

Few could see any alternative. Niall Ferguson, then something of a house historian to the Cameronite project, glibly predicted in 2011 that 10 years hence, Britain would be coasting off of Chinese foreign investment; Chinese purchases of Chelsea townhouses; and Chinese ownership of Scottish shooting estates.

But above all, this analysis was the making of George Osborne, Chancellor of the Exchequer between 2010 and 2016. Osborne lives in history as the austerity chancellor. Getting on for a decade after his fall, cuts to public expenditure are still held as an example of ‘Osbornomics’, and people like Rachel Reeves still feel the need to distance themselves from his legacy. But what really animated George Osborne was this diagnosis of Britain’s place in a post-Lehman world, of which David Lammy’s recent reset of relations with China is a faint echo.

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At every turn, Osborne sought to sharpen the lines that Cameron hoped would stay pleasingly blurred. As his early biographer, Janan Ganesh, notes, those Conservative colleagues who held to pre-1997 cultural views were for Osborne not merely old-fashioned but troglodytic. For someone such as David Cameron, for whom the Conservative Party is a kind of social forum, the eventual apostasy of Michael Gove and Boris Johnson over the European issue came as a genuine shock. It did not shock Osborne.

He, too, carried furthest the Cameronite idea of Britain’s place in a post-American age. When it came to business-like relations with China, it was the “Osborne Doctrine” that The Economist wrote of, not the Cameron Doctrine. For him, competition in a multipolar world demanded that Cameronism be carried to its logical conclusion: that Britain really become a svelte, socially liberal entrepôt, open for business with anyone and everyone. This was the conceit. And it forms part of an emerging folk history of the 2010s as a period of liberal oligarchy; a never-ending party for dodgy donors and Brics influence-peddlers in which nothing was sacred and all was for sale. This glittering world, as the narrative goes, was eventually brought to an end by Brexit, lockdown, and the de-globalisation that they imply.

It isn’t hard to see why. Osbornism, as a positive economic vision beyond the simple fiscal retrenchment known as austerity, quickly became associated with the fire sale of cherished national assets to overseas buyers. The beloved chocolatier Cadbury was bought by Kraft in 2010; the Chinese firm Geely acquired London’s fleet of black cabs in 2013. By 2016, up to a third of the student body of the ancient boarding schools was drawn from overseas. In a bid to attract further Chinese investment, Cameron and Osborne declined to support anti-dumping measures, sending British Steel into a tailspin that ended with its acquisition by a Shijiazhuang-based industrial concern in 2019.

Osbornism was also supposed to mean the economic dominance of London. Much was made of the idea that Osborne had enjoyed a metropolitan upbringing, and that the squirearch milieu of Chipping Norton meant little to him. For Osborne, it was said, London was Britain’s real proposition to the world: as a discreet provider of professional services, and as a global playground for Brics oligarchs. Osbornism had ostensibly created the tax and visa conditions for just this. Canary Wharf, the Shard, and a 20% stake in the London Stock Exchange were bought up by the Qataris, and the growth of a “Moscow-on-Thames” was watched with smiling equanimity. This was held to be an example of the new ruthless national accounting post-crash, funded at the expense of the luckless provinces in the country’s north.

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Capstone to the system of Osborne was the “Golden Era” of relations with China. Again, Osborne took this idea further than most. Engagement with China did not simply mean investment, but a full economic partnership. This had a logic. Before the decade was out, the European Union and the United States were once again making threatening noises about Britain’s position in Northern Ireland. In these circumstances, would it have been so bad to have in China an economic and diplomatic counterweight? The announcement, in March 2015, that Britain would be joining the Chinese-run Asian Infrastructure Investment Bank (AIIB) was a real coup, one that shocked and angered Washington. As one of the first practitioners of “multipolar world” theory, George Osborne had — perhaps by accident — produced a twitch of something like real strategic independence. If nothing else, Osbornism on the world stage hinted, however briefly, that there might be some alternative for Britain to the thankless enforcement of a rules-based international order, an order which, in the 2020s, does not permit Britain to control its own sea border.

These were cultural events more than they were economic ones. According to the tropes of the time, they spoke to a nation adjusting to stately poverty, whose traditional patterns of life were now sustained only by foreign money. But for Osborne, this was only what the moment demanded. Britain required a brute lesson of its place in the new world — a lesson which Osborne would administer, and of which the sale of flagship national assets was a symbol.

But there was always more theatre than reality to Osbornism. His public image was one of ruthlessness and hard choices, and so went the black cabs, the public schools, the legacy steelworks, along with other marquee national real estate like the Old War Office and the Admiralty Arch, which were both flogged on the cheap. So too was the practice — recently revealed — of selling cheese-tasting courses, magic lessons, and tennis matches with Conservative ministers to wealthy investors like Mohamed Amersi. Fiscal trifles by themselves, but seen by all as a sign of the moral compromises that Britain would now have to make. The fixation on curios like a direct flight from Manchester to China or a special visa for Chinese businessmen furnish two more examples.

All this could be presented as a kind of necessary stooping to conquer in the new Brics world, but none of them even made much money in the first place. Needless to say, no new era of svelte globalism resulted. In 2015, at the height of Osborne’s political fortunes, foreign investment stood at 1.54% of GDP — less than in France, that economic clamshell, where the figure was 1.76%. For all the talk of a “global race”, Britain left the first half of the 2010s no more globalised than it had previously been.

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By Tom McTague

What Osbornism represented, in unconscious terms, was the anxiety felt by a governing class convinced of national decline after 2008, but which baulked at the possible solutions. By 2015, there was no entrepôt and no global playground, but there was much of the attendant seaminess. This was a system that had all the trappings of an oligarchy, but none of its possible enjoyments. And this pretend oligarchy began to decompose almost as soon as it was assembled. As the British economy flickered back to life, Osborne embarked on a reversal of course that would undo much of his own work. First to be walked back on was the idea of Britain as a bolthole for the global plutocrats of tomorrow. In 2015, Osborne levied an “oligarch tax” on sales of homes by non-UK residents, and called for action against the financial networks that had been exposed in the Panama Papers. Boris Johnson, then the Mayor of London, publicly opposed both of these ideas. Barely a year before the Brexit referendum, then, it was Johnson who was cast as the defender of liberal globalisation, and Osborne who criticised its excesses — the complete opposite of later alignments.

Osborne was also the first to call time on the dominance of London. As soon as the capital began once more to turn a surplus, George Osborne cast around for ways to cream it off and spread it elsewhere. Osborne was the great sponsor of northern devolution, and patronised the idea of a directly elected Manchester mayor. And it was Osborne, not Theresa May, who first played the card of the regions, of London against the “left-behind”. Years before anyone had heard of Levelling Up, George Osborne was the champion of a Northern Powerhouse — such a champion, indeed, that the idea began to dominate talks with the Chinese during his last year in power. These kinds of hang-ups are not usually the subjects of international trade and diplomacy. It was a strange kind of myopia, and it spoke much more to a Little England self-involvement than Brexit ever did.

Flushed with victory after the election of 2015, Osborne was already putting together an agenda for his own premiership, which, among other things, would have seen state expenditure further reduced to around 35% of GDP. This, after the previous five years of cuts, was justified again and again with reference to the international situation — the need for a leaner and possibly meaner Britain in a post-American world. Had this plan succeeded, something like real economic liberalism would have been created in Britain. To accomplish it, Osborne planned to strengthen the party’s ties with those former Liberal Democrats who had delivered the victory of 2015: asset-rich, rural, generally older, either retired or disproportionately employed in the public sector.

A strange choice. Such a group, flushed with assets and state pensions, were the current economy’s main beneficiaries, and had no interest in overturning it. Osborne was attempting to carry out a programme of economic liberalism through the agency of some of the most reactionary classes in England. But as an ideology, Osbornism became evermore reliant on these places so that, in 2024, the two — by a strange twist — are now treated as virtually synonymous. In practice, Osborne’s plan to slash the size of the state was a demagogic one, and it required a demagogic course. It would have meant a popular appeal to the lower-middle classes — the only reliable constituency for economic liberalism. As with so much else, Osborne shrank from the means, and he left it to rivals Boris Johnson and Michael Gove to make such an appeal.

Osbornism, as a distinct ideology, has left almost no material legacy. It was always a politics of phrase and image, and it vanished at a word. In 2024, London is manifestly not the global playground it was meant to be. It is shifty candy stores that now set the tone of its main streets, not the scions of sheiks and the CCP. With furlough in March 2020, the six years of budgetary austerity that compromised the domestic side of this agenda were undone at a stroke, and ideas of a leaner, more competitive Britain were all but forgotten. The Emirati bid for The Spectator and the Telegraph — for which Osborne acted as a consultant — failed, and the door is now to be closed on any future such acquisitions. The Chinese investment is now largely gone, and “Moscow-on-Thames” was quickly rolled up, with old Cameronite retainers like Evgeny Lebedev now figures of suspicion. Osborne is the only national figure on the centre-right who still makes the case for a ‘Northern Powerhouse’, his old party colleagues having now soured on devolution. In 2024, the sole physical marker of Osbornism is a folly: a fairly miserable English leg of the Chinese “One Belt One Road” initiative, a rail line that shudders to a halt in a field near Barking. Far from being a vein of commerce, it is only used once a week, to ship 34 wagons of tourist merchandise to the city of Yiwu. It’s a symbol of a future that never was; an oligarchy that never was; a strange personal affect dreamt up in a moment of panic, and soon dropped.

Instead, Osbornism’s true legacy lies in its phrases, which are still with us today. It can be found in the idea that there exists a popular force of Cameron Ultras in the shires: a “Blue Wall”, whose salient characteristic is social liberalism, rather than being very rich. Whenever we are told that this entirely hallucinated demographic would have no truck with action on illegal migration or a moderation on Net Zero, we are hearing the echo of Osbornism.

As an actual agenda, though, Osbornism was a phantasm; a devilish idea that flickered briefly across the national consciousness and disappeared. What if England really was run to make money? We have yet to find out.

Cumulatively, these incidents reveal more than mere quirks of character. They tell us that behind the façade of technocratic competence — confected largely by the liberal press — is a man utterly out of his depth. Indeed, his chronic indecisiveness, let alone the vestiary vanity that dictates his behaviour, betrays a sensibility rather at odds with the trappings of technocracy. Technocrats typically see themselves as political plumbers, dour managers capable of unsentimentally transcending popular preoccupations in order to push through unpopular, if necessary, policies. Above all, they have a vision, however misguided; take their appalling record in the eurozone or the Third World.

Starmer, it is true, mimics the lexicon of technocrats with remarkable facility, all the trite soundbites about “sound money” and “short-term pain for long-term good”. Versions of these dicta have been repeated ad nauseam, most recently at the Labour Party conference in Liverpool this week. Yet the fact is that Starmer is no technocrat. He is, rather, a man without a plan, cluelessly blundering and muddling through from one crisis to the next. Lacking a vision for Britain, the “short-term pain” he promises with Calvinist glee can only be a prelude to long-term pain.

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Political incoherence, while damaging socially, can be rewarding individually. Indeed, it has stood Starmer in good stead. Possessed of a cynicism bordering on nihilism, our chameleon was happily reconciled to Osbornism in 2015 before taking a seat on Corbyn’s shadow cabinet only a year later. Two years on, by then already a darling of Islingtonian Europeanism, he led the anti-democratic putsch to reverse the result of the referendum, only to abandon the demand once its real objective — the displacement of the Left, of course, not re-entry into the EU — was achieved in 2019. His ascent to the party leadership followed shortly thereafter, on the strength of retaining the slate of reforms promised in the manifesto of old, including sweeping nationalisation and redistribution. Unsurprisingly, these pledges were swiftly jettisoned in a bid to refashion his party as a cut-price New Labour tribute act.

Adherents of a tradition less susceptible to spin-doctoring would no doubt have been left scratching their heads at Starmer’s seemingly endless capacity for reverse-ferreting. As it is, though, the mavens of self-respecting liberal opinion hardly batted an eyelid. The rare pleas for clarity voiced in the usual quarters of Labourist opinion — “Labour desperately needs to stand for something,” declared the New Statesman in 2021 — were drowned out by the plaudits of pundits praising such concessions to electability.

Much the same was said of Starmer’s bot-like proclamations to the press. We were led to believe that colourless Keir doesn’t have a favourite novel or poem, let alone a discerning literary taste. As a child, he had no fears, no phobias, the Guardian reported. “He doesn’t know what he dreamed last night — or ever: ‘I don’t dream.’” In the end, though, his carefully crafted conventionality counted for little. With fewer votes than Corbyn received in 2017 and 2019, Starmer was able to seize power only thanks to the distorting effect of the simple plurality system.

Having won, Starmer nevertheless finds himself at a loss. He has achieved power, but he has no idea what to do with it. There will be no more austerity, we are told, but we have every reason to believe otherwise. Committed, like Procrustes, to shortening the limbs of the state to fit the size of their budgetary bed, Starmer and Rachel Reeves have effectively set about outlawing growth. The first casualty, before the election, was the £28 billion “green prosperity” plan, scrapped in favour of a paltry £7 billion National Wealth Fund, literal peanuts compared to, say, Biden’s $369 billion climate package to reboot growth. Then, after the election, our austeritarian girlboss doubled down, doing for the £1.7 billion Stonehenge tunnel and slashing winter fuel payments for pensioners to the tune of £1.5 billion. All this, ostensibly, to help fill the £22 billion “black hole” that Reeves discovered on taking office — almost half of it in fact of her own making; Labour signed off on a £9.4 billion wage settlement with, among others, striking junior doctors and train drivers. Meanwhile, Labour has also committed to enforce additional spending cuts to the tune of £20 billion every year with the aim of shrinking public debt in year five of Starmer’s Labour.

Like a rope fetishist, then, Reeves has tightly bound the British economy. There can be no room for growth in such a circumscribed setup, the Financial Times and Institute for Fiscal Studies have independently warned. The figures speak volumes about the priorities of Starmer’s Labour. Capital investment, and therefore growth, have been sacrificed on the altar of wage expenditure for what has become a tiny aristocracy of Labour, while the Deliverooisation of the rest of the working class proceeds apace. On these benighted and un-unionised sections, austerity and casualisation can agreeably be imposed with no great loss to the carpetbagging Labour MPs of rentier, managerial and lobbyist backgrounds.

The upshot will be a return to Osbornite austerity after the brief one-nation Tory interlude of Boris Johnson and Rishi Sunak. Reeves denies this, even as she continues to subscribe to a heterodoxy no more dubious than extispicy, divination by means of inspecting animal entrails. “To my mum,” she says, “every penny mattered, and the basic test for whoever is Chancellor is to bring that attitude to our public finances.” Now, the cheese-paring mindset may have some value in the kitchen; but as every economist worth his salt has pointed out, it is of no use whatsoever in running the 6th-largest economy of the world. “Hard choices,” as she has it, in practice mean underinvestment in infrastructure, and accordingly low productivity and no growth, which in turns means less tax revenue and more spending cuts. It’s a vicious cycle. We know this not only through the sophistication of economic theory, but through historical experience.

Time was when Britain was the most productive nation in the world. These days, however, peer countries, even strike-ridden France, are on average 15% more productive. Post-communist Poland is set to overtake Britain on this metric by 2030. The contrast with our neighbours across the Channel, a recent policy paper persuasively argues, is painfully instructive. There, in France, massive investment in housing, infrastructure, and energy have sustained greater productivity even as French workers work fewer hours and take longer vacations, as anyone who has visited Paris in August knows. With roughly the same population, France has 38 million homes to Britain’s 30 million, with the result that the French enjoy lower rents and mortgages. Thanks to investments in clean energy, especially nuclear power, electricity is half as cheap as in Britain. France has opened 1,740 miles of high-speed rail since 1980; Britain, 67 miles. As with rail, so with roads: France has 12,000 kilometres of motorways; Britain, 4,000. Since 1945, metropolitan Paris has trebled in size; London is only a few % larger. Britain holds the dubious distinction of having Europe’s largest city without mass transit: Leeds. Chronic underinvestment, far below the OECD average, is to blame for all of this.

The upshot has been plain to see. When Starmer was sworn in, he took over a country in which 4 million households were in debt over utility bills, 7 million were forgoing food, heat, toiletries to make ends meet. The penny-pinchers at the Treasury could take pride in running the cheapest health service in the advanced capitalist world: the EU14 spent 21% more per capita on healthcare in the 2010s. The collateral damage, however, was world-leading cancer mortality rates, and the lowest number of MRI and CT scanners in the developed world. No doubt Starmer’s majority was augmented by the fact that 8% of Britons were awaiting an NHS procedure at the time of the election; or that real wages have flatlined, by some measures even fallen, since 2008.

Had there been no Osbornite austerity, and had capricious bureaucrats likewise not denied practically every investment proposal emanating from the private sector, it is likely — following the 1979-2008 trend line — that Britain would be some 25% more productive today. This, a back-of-the-envelope calculation shows, would have translated into a GDP per capita of £41,800 instead of £33,500, producing tax revenues of £1.28 billion instead £1.03 billion, with the result that our annual deficit of £85 billion in these years would have instead been an annual surplus of £170 billion.

It follows that in fetishising the fiscal straitjacket, Osborne, and by extension Starmer and Reeves, have in fact got it backwards. It was tax-and-spend investment that deflated the debt from 250% to 20% of GDP from the late-Forties to the early-Nineties; and it was the imposition of austerity and effective banning of investment that has now inflated it to 100%.

There was a time when politicos understood this. In the post-war period, they could be sanguine about high debt, knowing that they were committed to growing the pie, and assured by Keynes’s maxim: “Anything we can actually do we can afford.” These days, Reeves and her ilk are more likely to pull gargoyle faces at the very thought: “If we can’t afford it, we can’t do it,” she has declared.

Somehow foreign policy is exempt from these strictures. Starmer has promised Zelensky £3 billion a year “for as long as it takes”, a strong disincentive, if any, to diplomatic settlement in Donbas. His foreign secretary, meanwhile, has outlined his grim vision of “progressive realism” in the pages of Foreign Affairs, essentially a return to military power projection and democracy promotion at taxpayers’ expense, topped up with an unswerving commitment to Nato expansion.

Starmer, furthermore, is unruffled by the prospect of creating a £13 billion hole in public finances by bringing down legal migration — bad news for Britons a touch long in the tooth, who depend on bright young things coming from abroad to pay into their pension pots. As we have seen, Starmer is coming after the elderly; after the winter fuel subsidy, the triple-locked pension might be next. More pressing for our ruler is the £3 billion spent on housing the 30,000-odd refugees (0.05% of the national population) arriving annually in small boats.

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To save us from the indignity of having to facilitate the rapid assimilation of Syrian seamstresses and Afghan architects into the national populace, Starmer strolled about the Villa Doria Pamphili taking lessons from the Italian prime minister. No doubt reminding her that he is a figlio di un attrezzista, he praised at length the “remarkable progress” Giorgia Meloni had made in tackling refugees — which includes impounding vessels and curbing the funding of humanitarian groups who rescue migrants from drowning at sea, not to mention forging a deal with a Tunisian despot accused of torturing and dumping refugees on the Libyan border without food and shelter. Britain, Starmer says, has a lot to “learn” from Italy’s handling of refugees. One wonders if these are the practices he had in mind when he once declared that “the best of British values are also the best of Christian values”.

Then again, morality has never been at the heart of Starmer’s pitch. Fiscal prudence has. Truth be told, however, it’s really much ado about nothing. Based on the paltry figures I have already mentioned, unsuspecting readers might be forgiven for thinking that the Treasury has only a few billion lying about to toy with. The fact is that state spending exceeds £1 trillion. And a lot can be done with that sum, as Starmer himself sometimes recognises. Offsetting the doom and gloom that has been the core of his messaging, he has on occasion gestured towards ambition, as in his pledge to build 1.5 million homes over the course of his term. Good news, but I wouldn’t hold my breath. It will take a sea change in culture to combat council nimbyism and rentier interest. Michael Gove, that Whig interloper in the Tory party, discovered this the hard way when he attempted leasehold and eviction reforms. Today, 85 landlords sit in the Commons, 44 of them Labour’s, including Jas Athwal, the current parliament’s biggest slumlord with 15 mouldy and ant-infested rental properties to his name. It is likewise too early to tell what Labour’s sugar daddies like Lord Alli want from Starmer in return for indulging his penchant for paid-for pants.

At any event, reforming ambition doesn’t come naturally to self-respecting sensible centrists like Starmer. When it comes to fixing Britain, he declared at the Liverpool party conference, “there are no easy answers”. But there are. For one thing, a one-off, 1% wealth tax on millionaires, paid annually for five years, would raise a whopping £260 billion without punishing pensioners. For another, the Treasury could stop paying interest on the reserve balances of commercial banks, a scandalous subsidy to the tune of £35 billion a year. Labour would be saved from the unedifying spectacle of haggling over trifles like skint hippies in a Levantine flea market. Failing bold moves like these, it is hard not to come away with the impression that Starmer and his cronies are not serious people.

Here I am, walking down Benefits Street, behaving no better than Channel 4 when it put a camera on a drug addict called Fungi — he named himself for mould — lamenting the loss of his child. This late Victorian street is fascinating, but TV can turn anything into Madame Tussauds. The houses are small, and neat, but the overriding aesthetic is bins.

Birmingham Council has a mad bin policy. Each tiny house has two vast black bins outside it. As if in fury at this mad bin policy, the street is filled with rubbish. When I discuss this with the residents — they all talk about rubbish — they blame each other. This is a very ethnically diverse area, and they blame eastern Europeans. If I were Channel 4, I would find an eastern European to defend himself — did you drop that nappy, did you? — but I’m not, and I don’t.

As if to delight Channel 4, the first thing I see is a robbery, and it is barely 10am. With sublime irony, it takes place opposite HMP Birmingham, which dominates Winson Green: there used to be a workhouse and an asylum too, but only the prison made it. There is scuffling, and a young woman punches her way out of a corner shop and hurries across the road. She was stealing food worth pennies, says the woman who works in the shop. She tells me not to worry. It happens every day. It’s easy for a tourist to find what they are looking for here: despair. I see a homeless woman near the tram stop, scrabbling on the floor for silver she has dropped. She is frightened it will be stolen, and she grapples with the dirt.

But James Turner Street is more functional than it looks: or, rather, it isn’t special. The man who owns the MOT shop — that is the industry here now, cars and corner shops — suggests that, if it were honest, Benefits Street would have been a franchise, with an outpost in every town. “What they [Channel 4] tried to isolate — ‘this is the dump of the UK!’ — it isn’t,” he says. “Every area you go to you will find a street where people are going through similar struggles. It is just another street. It’s in line with the rest of the UK. It has become worse [in the last decade]. The only ones who are benefitting are the upper class.”

We stare at business owners, landlords, driving Range Rovers past his window. He knew Stephen “Smoggy” Smith, “the 50p man” from TV, who sold household goods for 50p. He had a kind heart — he gave things away to struggling parents — but he moved on. Everyone who starred in the show has moved on, been imprisoned, or died. The only one I manage to contact is Sherrell Dillion, now a successful model. She sends me a courteous message on Instagram, but she can’t face talking about the show: “I’ve spoken about Benefits Street until my legs fall off.”

There is an Ofsted-rated “outstanding” school on the corner and, opposite it, the community garden. I am given a tour by a kindly old man. He shows me compost “fully rotted down”, which he sells for £4 a bag, the wildlife sanctuary — birds, squirrels, “rats of course” — and the herb beds for local families. On Bonfire Night they had 200 people, and fire pits. “They [Channel 4] weren’t interested in anyone with a functional life,” he says. “They picked on people with benefits, they picked on the ones who were more colourful, so to speak. It helped to sell the programme.”

I see an elderly couple walking into a house. It belongs to the man’s brother, he says, who is in hospital. He is happy to let me in. And here it is: the fictionalised house. The decor is from the Seventies, when wages in Birmingham were among the highest in the country: they collapsed within a decade as manufacturing did, though Benefits Street didn’t talk about that. The carpets are dark swirls; the wallpaper is a pattern of red poppies; there is a horse figurine on the gas fire, and seascapes on the walls; the small Christmas tree is dying in its pot. The woman is cleaning a stain from the red velveteen couch on her knees.

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He tells me that 2014 was an odd time in the history of the street. There were alcoholics and drug addicts here: “a period when they all seemed to come together”. His brother likes it here: “He’s not an adventurous person. He’s lonely, and he took to drink.” He tried gardening to ease his loneliness, by taking part in an allotment scheme: “It fell by the wayside and disappeared. No one is left from that time.” Or almost no one. They tell me to call on a lady four doors down. I knock, a face peers out of the front window, and an ancient woman opens the door a crack. She has lived here for 50 years, she says. “They [Channel 4] never came to my house. I don’t smoke cigs,” — and she laughs — “I don’t smoke ganja.” Her husband is dead and she tells me she thinks she will die soon.

“Everything has changed here. It was lovely,” — and she points down the street — “Mrs Shaw lived there. And,” — she squeezes her forehead up — “I can’t remember her name. It’s my home. I paid for it. Not council. My husband was a bus driver. We had hanging baskets: lovely plants. There is rubbish everywhere. God forgive me. I am not telling a lie. I won’t do anything about it because I will soon be gone. We all have to go sometime. This street has gone to the dogs — that’s what I say. We are human beings.”

She points down the street: “They are gone. They are gone. They are gone”. She opens the door wider. Her small living room is very hot, and gaudily decorated. She points at a photograph of her hanging baskets in bloom: so I will believe that they existed.

I bump into a man who worked for 47 years as a lorry driver. It is important to him that I know this. “I refused to go on [the show],” he says. “They didn’t say they wanted people on the dole. I can show you the paperwork. They never said nothing about a job centre, [about] benefits. They didn’t tell people what they were doing. They said it was about the community.” He shuffles off in anger, still smarting at the insult. But still he turns back and adds: “I have been burgled 28 times.” Then I meet Jay, a youngish man with paper bags of new goods. “It’s a shithole!” he exclaims. “No matter what street you pick, it is definitely the shitter end of Birmingham. But you could have thrown a dart at any major city in Britain: Birmingham, Liverpool, London, and you would have hit a James Turner Street. We drew the short straw there and ended up on the telly. I should imagine it would ruin your life if you were on drugs.” I think of Fungi, later to become a ghostly tabloid staple. He died in 2019.

He points towards HMP Birmingham: “There are more criminals this side of the fence than that side. You could have picked any street in any big city and found characters like that. Apparently, some of them did well out of it.” I follow him home. He lives in an HMO [house of multiple occupation] “with three men from Gambia who smoke weed”. We sit in the living room, which has a vast red sofa and a vase of plastic flowers. It smells of bleach because they are cleaning up after a mouse infestation. It got so bad the landlord moved a cat into the front bedroom. I also meet Minnie the English bulldog who, Jay says, “saved me”. She places herself between us, and growls. Minnie is trained to bark at people wearing face masks and carrying pipes. I also meet his flatmate, who is masked, though Minnie doesn’t bark at him. Jay introduces me as his probation officer.

Jay shows me his housing benefit papers: the landlord gets £1,000 per room per month from the taxpayer, or almost £50,000 a year for a house worth £100,000, with no hot water downstairs “apart from the shower”, cockroaches, and mice. This stuns me but Jay wants to talk about crime. He’s been in HMP Birmingham — “one of the best prisons in the UK” — for violence and theft, “though I’ve calmed down now. It’s much better than Strangeways. The drug scene is terrible here. Crack, heroin, cannabis: you name it. These HMOs aren’t helping.” Drug dealers steal from each other. They find cannabis plants using heat sensors and smash their way in, but no one is arrested because you can’t telephone the police and say your cannabis plants have been stolen.

Jay went into a spiral when his mother died. He split up with his partner, his children were taken into care, and he started drinking. “I think I’m coming out the other end of it,” he says. “I could do with moving from here to be honest.” He stares at me: “If you’re looking to start again this isn’t the place to do it. People keep themselves to themselves. It’s hard to start a new life here. It’s hard to live on benefits. Most people are on benefits, and I don’t know how. I look around me, and everyone I know is on the sick. There are five people living in this house and not one person works. How can that be? I don’t see anyone putting into the pot. How can everyone I know be taking out?”

He was offered a job at the carwash round the corner, he says, for £10 per six-hour day in mid-winter. The minimum wage is £10.42 an hour, not £1.66, but the owner trusted the taxpayer would intercede. Now Jay is off for depression: “They will sign anyone off for that. I have been on the sick for two years.” He used to fit ventilated wall systems in London and wishes he could again, but he lost his licence for drink-driving. “The gaffer wouldn’t touch it. I shamed the company.” The next day I go back to say goodbye. His housemate answers the door. Cannabis smoke flows around him like a special effect. He says Jay is asleep and can’t be disturbed.

I leave, knowing that there are variations of Jay in the inner suburbs of all of our cities, but we don’t see them. Channel 4 made a fiction from a whole class — and a fiction can be easily ignored. It was. It still is.

Britain’s waters are in a foul state. Official statistics show that there was an average of 825 sewage spills a day last year — including in the Environment Secretary’s own Suffolk constituency, where the water contains levels of e. coli more than 20 times the limit for bathing. In England, just 14% of rivers are rated ecologically “good”. In January, an NHS worker caught hepatitis while wild swimming, and last summer, dozens of beaches in England were closed due to toxic waste warnings.

The result is that the seemingly old-fashioned issue of sanitation — a problem most of us thought we’d solved around the same time as cholera — has once again become a political flashpoint. Half the British public now see protecting rivers as an important voting issue. In the May local elections, both the Liberal Democrats and Greens specifically targeted sewage as a swing issue — and saw their biggest gains in years. The Conservative seats newly up for by-elections should take note: Nadine Dorries’ former constituency of Mid Bedfordshire, for one, is currently in uproar at the sorry state of the river Ouse.

This is part of a wider trend: the environment is now regularly among the top four issues most important to the electorate — beating issues such as crime or childcare. It is even more of a focus in Conservative-held swing seats. And there’s a reason why sewage inspires such strong emotions — beyond the fact that it’s ruined the wild swimming trend. The scandal is in many ways a perfect microcosm of Britain’s political woes of the last decade: austerity, failed privatisation, corporate greed, climate apathy. After all, what good is a government if it can’t keep our shit out of our streams?

If you want to understand how this country’s waters got into such a mess, an obvious place to start is in 2010, with the coalition government. Its austerity policies slashed spending ringfenced for environmental protection by 80%, gutting the Environmental Agency’s ability to monitor our waters and, crucially, enforce punitive measures against polluters. It’s hardly surprising that, since then, sewage spill events into British rivers have doubled.

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But one could go back even further. It was Margaret Thatcher’s government that, in 1989, privatised water utilities in England — making it the only country in the world to do so. The water companies were granted regional monopolies, debt-free, the argument being that they could run the system more competitively than the state could. In reality, many water companies have spent the decades since loading themselves with debt, deploying increasingly byzantine financial engineering to avoid corporation tax, and paying billions to shareholders and millions to their own executives — all the while under-investing in infrastructure and hiking prices for customers at rates considerably above inflation. Handed a money tap, they simply turned the spigot.

But if you want to get to the real heart of our sewage crisis, it makes sense to go back even further, to the summer of 1858, and the now infamous “Great Stink”. One of the things that period dramas never capture about Victorian England is the stench. It’s hard to imagine: tanneries filled the air with the scent of urine-soaked hides, and soap-makers with the smell of boiling bones. Carriages clogged the roads, leaving them caked in horse manure. But worst of all would have been the smell of human shit.

Before the widespread adoption of sewers, people used privies — holes that emptied into a cesspit. For centuries those cesspits were cleaned out by nightsoil men, who would come by and, for a small fee, dig out and cart your waste away to farms on the outskirts of the city to be used as fertiliser. In the 1840s, led by sanitary reformers such as Edwin Chadwick, the British government passed a series of measures to try to clean up the capital. Among their reforms: mandating the connection of cesspits to the city’s sewers.

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It was a deadly mistake. Rather than clear the air as Chadwick had hoped, the solution channelled an ever-greater deluge of foulness into the Thames. By the 1850s, the river was unimaginably polluted. Dickens called it a “deadly sewer”, Benjamin Disraeli a “stygian pool, reeking with ineffable and intolerable horrors”. In the summer of 1858, London boiled. The water levels in the river fell, leaving the waste within slathered up the banks. The smell fell foul across the city; there were reports of people feeling sick from miles away. Parliament ordered the curtains doused in lime chloride to mask the stench, with little effect.

The Great Stink led Westminster’s flailing political classes to finally act. They appointed the Joseph Bazalgette — one of the great British engineers of his time — to design a massive new sewage system for London. Bazalgette’s plan was astonishing in scope: it resulted in the laying of 720km of new sewer lines and the creation of the Victoria and Albert embankments, reshaping the city and its connection to the Thames. The resulting reduction in exposure to unclean water likely prevented millions of deaths; it’s thought that the introduction of sanitation in the 19th century added 20 years to the average human lifespan.

But Bazalgette’s design had a significant flaw; it was a combined sewer — that is, the main underground pipes were designed to carry both wastewater from buildings and rainwater collected by the city’s drains, to help dilute and flush out the system. During unusually heavy rainfall, they would flood; with such instances in mind, the sewers were designed with outlet valves called Combined Sewer Overflows, which would expel excess flow directly into waterways, untreated. Here is where our current sewage crisis stems from.

When Bazalgette designed London’s sewers, overflows were supposed to be a rare event. But various factors have conspired to make them commonplace. One is the all-engulfing expansion of concrete: new roads, pavements, and building developments block rainwater from entering natural soakaways — trees, soils, wetlands — that would otherwise absorb it. Another factor, inevitably, is climate change, which increased the occurrence and intensity of storms — and therefore flooding.

Today, there are around 100,000km of combined sewers in England alone, and around 15,000 overflows. Modern sanitary engineers hate them, but because so many of the central “hub” sewers are combined, introducing new models often doesn’t make a difference. To prevent spills, water utilities have periodically built storm overflow tanks, designed to hold excess sewage until it can be treated. But due to systemic under-investment by water companies, there is at present simply not enough capacity to store it all. For my book, Wasteland, I visited Mogden sewage works in London, which serves an estimated two million people: it has a series of storm tanks installed, and yet in 2020 alone it released enough sewage into the Thames to fill 2,768 Olympic swimming pools.

Water companies often use their ancient infrastructure as an excuse for not solving their pollution problem. It’s certainly true that replacing our combined system would be a Bazalgettian feat; a government-commissioned report, published in 2021, estimated that eliminating storm overflows in the UK would cost up to £600 billion, and increase household bills by up to £999 a year. (Not that we would have to replace the whole system to make the situation more bearable.) It would also do nothing to solve the other primary culprit behind our spoiled waters, the rampant phosphate pollution by industrial farms. The current plan, in London at least, is to divert the existing combined sewers into something even bigger: the £5 billion Tideway Tunnel currently being dug under the Thames. Thames Water estimates that when the “super sewer” is completed in 2024, 95% of raw sewage that pollutes the river today will no longer flow into it.

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But the fact is, just continuously expanding the old system isn’t going to work. This is one of the central dilemmas presented by climate change: do we press ahead with novel but potentially expensive technological solutions, or do we look back, and find inspiration in the natural world? China, for example, has met the sewage challenge by embracing so-called “sponge cities”, in which natural soakaways, permeable pavements, and wetlands are being built into city planning in order to soak up storm water and prevent flooding.

But swales and reed beds are not going to replace our traditional sewage infrastructure any time soon. Solving this problem can’t wait. With summer droughts becoming more common and storms more intense, protecting our water supply is only becoming more vital. Whoever wants to win the next election is going to need to convince the public they can turn the situation around, and fast.

With no small irony, the European Commission has just unveiled its draft plan for reducing public debt across the bloc — debts which the Commission previously encouraged. In early 2020, for instance, the EU suspended its notoriously tight budgetary rules in order to, as Commission President Ursula von der Leyen declared, allow countries to spend “as much as they need”. The ECB also stepped in, launching a trillion-euro bond-purchasing programme to help governments finance their ballooning fiscal deficits. The following year, member states also agreed on a much-vaunted, €750-billion Europe-wide “recovery plan”.

At the time, observers heralded these unprecedented measures as evidence that the EU had finally learned from its past mistakes and overcome its pro-austerity bias. Some even described it as the EU’s “Hamiltonian moment”, which signalled that the bloc was finally evolving into a fully-fledged federation. This was wishful thinking. It was only a matter of time before old conflicts re-emerged between Europe’s fiscal hawks — first and foremost Germany — and the high-debt countries of the periphery.

Moreover, for all the talk of the EU’s integration-through-crisis approach, it should be apparent by now that no crisis will be big enough to muster support — among Europe’s national elites or, even more so, among ordinary citizens — for a move towards full-blown federalism. History has its rules, and the economic, political and cultural conditions for that simply aren’t there, and won’t be for a long time. More importantly, such starry-eyed analyses betrayed a fundamental misunderstanding of the true nature of the EU. European economic and monetary integration is a fundamentally anti-democratic project — one that is aimed at placing economic policy beyond the control of voters. Depriving nations of their currency-issuing powers was a fundamental plank of this project, because it meant that governments had little choice but to go along with the policies dictated by the new currency issuer — the EU — regardless of their democratic mandate.

National elites, eager to escape the pressures of their own electorates, embraced the process only for the dramatic consequences of doing so to become apparent in the aftermath of the euro crisis. At this point, the EU employed its powers to subvert democracy and impose crushing austerity across the continent, even against the wishes of elected governments. (Just ask Greece or Italy.)

In this sense, the suspension of the EU’s fiscal rules and the ECB’s transformation into a lender of first resort were extraordinary precisely because they made euro countries somewhat “sovereign” again, whereby democratically elected governments could choose their budgetary policies without the constant threat of retaliation from the ECB or the European Commission. But this is also why it was only a matter of time before these measures were curtailed; after all, they defeated the very purpose of the EU’s project.

The first step in the restoration of the status quo came last summer, when the ECB ended its bond-buying programme and began raising interest rates. The second is the European Commission’s debt-reduction plan, which is little more than a rehash of the old Stability and Growth Pact, first conceived in 1997. According to the proposal, countries with a deficit-to-GDP ratio above 3% or a debt-to-GDP ratio above 60% — the thresholds decided in the 1992 Maastricht Treaty — will be required to implement a fiscal adjustment programme; the higher the deficit/debt, the faster countries will required to bring those ratios down.

Today, around two dozen countries would fall under the scope of the new deficit and debt-reduction plans; the ones required to make the most stringent action would be Greece, Italy, France, Spain and Belgium. These nations would have to commit to a minimum deficit reduction of 0.5% of GDP every year, which could increase to 1.5% in some cases, mainly through budget cuts amounting to several billions of euros every year. In other words, austerity.

For Germany, however, this is still too soft; its finance minister, Christian Lindner, wants a binding and inflexible minimum debt-reduction trajectory of 1% of GDP per year for the worst transgressors. But despite their disagreements, Germany and the Commission ultimately share the same underlying assumptions: that the deficit and debt levels of some countries — depending on how much they exceed a set of arbitrary limits decided more than 30 years ago — are “unsustainable” and that growth depends on “sound public finances”. This is an exact replay of the debate that dominated the euro crisis of the 2010s. Even then, after relaxing fiscal rules to allow for the massive bailout of the banking system, Germany and the EU insisted that there was no alternative to the imposition of harsh fiscal austerity on the great majority of European countries, especially those at the periphery.

These policies didn’t just raise unemployment, erode social welfare, push large portions of the population to the brink of poverty and, in the case of Greece and other countries, create a genuine humanitarian emergency — they also completely failed to achieve their stated aims of kickstarting growth and reducing debt-to-GDP ratios. On the contrary, they drove economies into recession and increased debt-to-GDP ratios. Meanwhile, democratic norms were dramatically upended, as entire countries were essentially put into “controlled administration”. The result was a “lost decade” of stagnation and permacrisis which led to a profound divide between the eurozone’s north and south, and brought the monetary union to the brink of self-implosion.

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The whole austerity experiment was such a catastrophic failure — as even the IMF later admitted — that one cannot help but despair at its revival. But ultimately, this is just another reminder that none of the underlying problems of the euro have been resolved: the cultural outlook and economic interests of member states continue to be irreconcilable, and the fate of nations and democratically elected governments continues to be in the hands of unelected technocrats in Frankfurt and Brussels. Yet it’s hard to see how Europe could survive a second round of austerity, which would come at a time when the state of the global economy is far bleaker than it did a decade ago: we are facing high inflation, supply-chain disruptions, global fragmentation and a war with no end in sight at Europe’s border with Russia.

Here, though, is the greatest paradox of the present situation: while the EU is devising a plan to get states to cut their overall budgets, it is also calling on governments to increase their defence budgets to at least 2% of their GDP to comply with Nato’s spending target. And among those countries expected to drastically increase their defence spending are some of the bloc’s most indebted nations (which therefore also face the harshest debt-reduction requirements): Portugal (whose spending stands at 0.8% of GDP), Spain (1%), Belgium (0.9%) and Italy (1.4%).

Just last week, the European Commission announced its billion-euro plan to increase Europe’s capacity for producing ammunition to send to Ukraine, for which member states will have to contribute up to a billion euros — yet another step in Europe’s “switch to war economy mode”, as commissioner Thierry Breton put it. In other words, European countries will soon be required to cut back on social welfare and crucial investment in non-defence-related areas in order to finance the EU’s new defence economy — we might call this military austerity — in the context of the bloc’s increasingly vassal-like subordination to US foreign policy.

All of which points to the inevitability of Germany’s return as the EU’s “economic policeman”. For the past year, the country has been trying to redefine its role in light of the massive tectonic shifts brought about the war in Ukraine — especially Europe’s geopolitical pivot from the West to the East. Perhaps it has finally found one: in the form of a renewed “special relationship” with the US as its primary Western European proxy, particularly when it comes to foreign policy. As Wolfgang Streeck has argued, this would entail re-establishing a position of economic leadership within the EU, on the provision of managing it on Washington’s behalf and of “tak[ing] responsibility for organising and, importantly, financing the European contribution to the war”.

This combination of austerity, renewed German hegemony and aggressive militarism makes the Europe of the past decade look positively benign. But this simply confirms the old adage that, when it comes to the EU, there’s always a way for things to get worse.

Elsie’s tragic tale cut through to the public in a way that statistics could not, despite some of the numbers pointing to a resurgence of almost-Victorian aspects of want. Rough sleeping, for example, has shot up by a quarter in a single year. There has been a “significant decrease” in the average age of death in deprived neighbourhoods. The government’s annual poverty figures have just recorded a million more sinking below the breadline and in the same data, released within 24 hours of the fastest food inflation since 1977, officials for the first time ever deemed it important to tally foodbank use.

And yet even the best-intentioned people can simply glaze over at figure-heavy headlines about Britain’s cost-of-living crisis. But if numbers are prone to being ignored, anecdotes can be unrepresentative. To paint a credible portrait of Britain’s new penury, therefore, we need to grapple with statistical tables and personal stories alike — with the quantity and the quality of poverty. I’ve dedicated the last few months to that, working with reporters who are lending an ear to the communities that many politicians would rather ignore.

They have heard tales of bitter hardship that wouldn’t be out of place in a Charles Dickens novel, or in the reporting of George Orwell and J.B. Priestley. In many ways, Britain’s new poverty is much like the old. The street urchins in Dickens’s London and the impoverished mill workers in Engels’s Manchester would be familiar with many of the experiences described by the testimony collated in Broke. The brute privation some describe — the bite of the cold, the gnawing of hunger, the terror of ending up without a roof over their head — would have been shared by many Victorian Londoners. The shock is to find such conditions resurgent in a post-industrial society incomparably richer than that chronicled by Dickens.

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Our society may have grown too wealthy to fear mass undernourishment on a 19th-century scale, but our decade could still, like the 1840s and 1930s, earn the unhappy moniker “the hungry” Twenties. A hundred and fifty years after George Eliot likened poverty to leprosy in Middlemarch, on the basis that “it divides us from what we most care for”, a trip to a Tottenham foodbank reveals how poverty can alienate people from those dearest to them. Yvonne, a 63-year-old former social worker with a degenerative spinal condition, still refuses to let her four adult children know that she is struggling, and so cuts herself off from what should be her support network.

Such hardship gets under an individual’s skin and sometimes breaks the spirit. Staff at a GP practice in a run-down part of Glasgow which features in the book affirm how often such thoughts turn into deeds in their part of the world: overdoses and suicides routinely cut grotesquely short the lives lodged in their books.

Despite continuity with the past in the nature of poverty, a lot of the numbers concerning Britain’s current poverty crisis today are decidedly novel. From the Victorian “poor house” through to the Beveridge report, the problem of poverty in the past was — overwhelmingly — a problem of old age. No longer. Pick a pensioner at random and they are markedly less likely to be in poverty than someone plucked from the general population. In her hardship, Elsie has become the exception, not the rule.

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The flipside of ameliorating conditions for older Britons has been tanking fortunes for others. The total number of children growing up under the poverty line, which was falling around the turn of the century after Tony Blair and Gordon Brown vowed to eradicate the problem, is rocketing back to its Nineties peaks. The official tally is now just 100,000 short of the 4.3 million record, and once the rear-view-mirror data catches up with the energy crunch, it could scale shameful new heights. The link to specific cuts is getting starker, too. Take the “two-child policy”, a crude attempt to discourage cash-strapped parents from having kids, driven through soon after the Conservatives won single-party power in 2015, which ends up punishing third and fourth children by denying them support. Sure enough, according to Whitehall’s latest numbers, families with three or more children are now twice as likely to have resorted to foodbanks as their smaller counterparts.

Children aren’t the only ones affected. Disabled people, thanks to cross-party reforms from the Seventies, were rarely doomed to destitution. That is, until recently. Following a series of restrictions and freezes, a colleague and I calculated that single disabled people were roughly four times more likely than the non-disabled to be falling behind with their bills, six times more likely to be growing cold, and nine times more likely to be going hungry.

Given the drift of Britain’s demographics, the “new poverty” is inevitably somewhat more diverse than the old — but it is, perhaps, surprising to learn quite how far it skews. A lot of the political discussion, and a lot of very good reporting, has concentrated on England’s “left behind” coastal towns and ageing industrial towns, both of which tend to be white. But if we just concentrate on the hard finances, rather than a vaguer sense of malaise, all of the country’s main ethnic minority groups still suffer from consistently higher poverty rates than the white majority. For some, like British Indians, the gap is these days small; for others — like Bangladeshis and Black Caribbeans — the excess risk of poverty remains double or more. Meanwhile, for a large and growing band of migrants, the “no recourse to public funds” rule frequently spells automatic destitution.

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Another break from the past concerns work. There is a particular irony here, given the way the austerity assault on the welfare state was sold as necessary to safeguard the toiling taxpayer. But the rhetorical binaries between “grafters” and “grifters” are ever-less plausible. Over the 2010s, there was a remorseless rise in the relative weight of working poverty: setting pensioners aside, less than half of poor adults lived in a “working household” back in the mid-Nineties; that same proportion steadily rose to 68% by 2019-20.

Can the poverty tide be reversed? We could learn from past success. Pulling the elderly out of poverty did not happen by accident: the change was the result of both successful social policy choices (including controversial means-tested support) and supportive private institutions (notably workplace pensions). There are questions about how sustainable the settlement is, and indeed pensioner poverty is just starting to creep back up. It’s also true that special political factors — a large and growing electorate of pensioners who reliably turn out to vote — helped unlock higher public spending in this field after the Turner Commission reported in 2005.

But these caveats should not distract us from remains an almighty, historic triumph. We should pore over the progress on pensioner poverty, and figure out how to replicate it. Many activists exhibit a weakness: the “despondency problem” sharply defined by the Princeton sociologist Matthew Desmond as being “fluent in the language of grievance and bumbling in the language of repair”. To shrug off the ancient belief that poverty is inevitable, and build faith in change, we must shout about success where we can point to it.

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At the same time, the average voter needs to care about poverty. This isn’t always a given. The uncomfortable truth, as Desmond heavily underlines, is that it flows from a system which in some respects serves the majority’s self-interests: the flipside of gnawing insecurity for gig economy workers is, for example, convenience for the consumers.

But one feature of 21st-century hardship may help the cause: namely, a disturbing sense of the boundary between the supporters and the supplicants of life getting blurred as the big squeeze goes up the income ladder.

UnHerd’s own polling underlines this point, with 62% of Brits now agreeing with the statement: “I worry about affording the necessities, such as food and energy.” When those findings are projected across the political map, every constituency across the land registers at least a modest majority in this position. This is the backdrop to the stories of two women we uncovered in Manchester: Phoebe, an increasingly indebted debt advice worker, who admits she’s too scared to commit her own finances to paper; and Sophie, a foodbank volunteer, who one day found she had no choice but to become a foodbank user.

Such tales are palpably disturbing. But they could also provide a chance to reset the debate. The missing ingredient in Britain’s conversation about poverty has been empathy — the poor are talked of as a different species, away on Benefits Street. As ever-more voters feel the pinch, the mood could change. Newly exposed, the majority might be persuaded to repair the holes that austerity has cut in the safety net. Then perhaps we might make progress towards fixing what is currently broke.

If Hunt fails to address these, he knows what will happen. The fate of his immediate predecessor still looms large; it’s not even two months since Kwasi Kwarteng made his September statement, a moment that will go down as one of the biggest political calamities in history. The fallout showed clearly that the country’s creditors will not support unbalanced books — and this makes Hunt’s job infinitely trickier.

For all the failings of Truss and Kwarteng’s short reign, their fundamental diagnosis was right: the British economy had been too lethargic for too long. It is an inescapable fact that GDP and real-term wage growth have never recovered their pre-Financial Crisis trajectory. Both as a nation and as individuals, we are much poorer than we could have been, especially compared to some of our European neighbours. Without borrowing, this creates a particular crunch around public spending.

In simple terms, as the economy grows, more money becomes available for public services even if the proportion of tax remains the same. As Liz Truss delighted in putting it, if you increase the size of the pie, the slices get bigger. The problem for Britain is that we have failed to do this, meaning that even to keep services at the same level requires a greater proportion of spending, which must come either from borrowing or taxation.

But with the price of borrowing increasing and the markets averse to unfunded promises, the government is unwilling to commit to more debt-led spending. Hunt, then, faces a stark choice: between protecting services by raising taxes and protecting households by cutting spending. Hunt is likely to chart a course through the middle of both, with a sober budget that both increases personal taxation and reduces public spending. Neither of these is likely to be popular.

It is unclear where any new austerity will come from. “Efficiency savings” have largely failed to materialise and an air of dereliction now hangs about the public realm: NHS appointments are oversubscribed, the police overstretched, and councils cutting back, while staff are demoralised and likely to turn militant if faced with further pay attrition. This has an economic effect but is also a political problem for the Chancellor.

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Austerity was never a popular platform beyond a few evangelists for the small state. It worked to win elections when contrasted with perceived Labour profligacy and an immediate emergency (the 2008 crash), and was focused on those who would rarely vote Tory anyway. Households in the shires can stomach slashing Universal Credit and foreign aid, but do not like it when things they value are cut. A Conservative Chancellor could slice away benefits but would face electoral wrath if they force councils to abandon weekly bin collections. The biggest test of this is, of course, the triple-lock pensions increase, where the beneficiaries are most likely to vote Tory.

The temptation for a Chancellor is therefore to cut the things people cannot really see — long-term expenditure. Proposed infrastructure spending is easier to reduce or cancel because the public do not feel its impact for a decade or so, but this is a false economy. The Russian invasion of Ukraine highlighted the folly of failing to build nuclear power or maintain gas storage, while many British cities find their growth stymied by a lack of transport investment. Underinvesting now will only preserve those problems.

In the Eighties, Harold Macmillan lamented that Thatcher’s government saw no difference between income and capital when it came to money coming in, viewing receipts from privatisation as much the same as taxation income. He saw the government as like an old aristocratic family, selling the family assets and living on the receipts day-to-day. Now the party must avoid making the same mistake with expenditure and discriminate between the things which will fuel growth, and which will not — as “Supermac” might put it, you cannot keep buying champagne while cancelling the restoration of the Caravaggio that brings the day-trippers in.

Part of the strength of the Sunak campaign to replace Truss was that he was at home in the world of finance — that he could speak the language and understand the fears of those who lend Britain money. His years in the City should have taught him something else: the difference between streamlining and hamstringing. Cutting spending and restructuring borrowing only adds value if growth is unimpeded.

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And yet, chastened by the mini-budget, Hunt seems poised to revert to the austerity of the first half of the decade. The issue he faces is that without something to stimulate further growth, he is just making a rod for his own, and the country’s back. Like any Tory, he will also find it difficult to navigate around the economic costs of Brexit. At the same time, borrowing more to spend cedes political ground to Labour, who can then outbid the Tories and trap them in their own hypocrisy.

There is, however, one aspect in which the Chancellor can be liberated this Thursday. If he’s smart, he will understand the party has already lost the next election. The drop in polling established by a year of Johnson and accelerated by the Truss debacle offers little chance of resurrection. There should be fewer giveaways for favourite groups, more governing in the national interest. Where normally budgets are padded with electoral quid pro quos, such as nudging up tax allowances or funding for towns in marginal seats, the Tories are on to such a loser this can probably be avoided.

When Hunt comes to the despatch box on Thursday, he will be constricted by the realities of a complex economic crisis and the political decisions that brought us there. Though leaks from Downing Street suggest all manner of changes are on the table, the path to success is narrow. His decisions are fettered, and there’s no shouting “I’m a Chancellor get me out of here”. The question is whether he finds the catalyst for growth, or simply tightens the vice.

Anyone with a basic grasp of economics knows that raising interest rates at a time of recession is bound to make it worse. Borrowing will become more expensive, while mortgage holders will face higher monthly bills — and all the while, the country is grappling with a devastating cost-of-living crisis.

Officially, the Bank’s actions are aimed at curbing inflation. But this approach would only make sense if the current inflation were being driven by excess demand — that is, if people had magically found themselves flush with cash and had started splashing out. Alas, anyone living in the real world knows that’s not the case: two years of lockdowns and restrictions have left many people poorer, not richer.

Only last month, a study by Bank of England staff confirmed what was obvious to most people, but apparently not to the researchers’ bosses. Current inflation has nothing to do with excess demand, but is largely driven by exogenous, supply-side factors: “supply bottlenecks along global value chains due to the Covid-19 pandemic (for instance, with microchips and used cars) and soaring energy and food prices related to Russia’s invasion of Ukraine”. Other studies have also emphasised the role of corporate profiteering, in particular, price gouging by large corporations with near-monopolistic market power, especially in the energy sector.

Neither is there any evidence of a Seventies-style wage-price spiral. On the contrary, real wages are not only failing to keep up with inflation — they’re falling off a cliff, in the UK and elsewhere. That’s because the bargaining power of workers has been severely weakened by decades of anti-labour and anti-union policies.

Even the Bank of England itself acknowledges that it expects inflation to fall sharply from the middle of next year — even below its target of 2% from late 2023. The reason is fairly obvious: inflation measures the change of prices from one year to the next, so this year’s rate accounts for the massive price increase caused by the conflict in Ukraine. Next year, however, prices are expected to remain relatively high, but not to rise significantly compared to current levels. In other words, we’ll almost certainly still be facing a cost-of-living crisis — especially if the Bank of England continues along this path — but not much of an inflationary crisis.

So if the current inflationary bout has nothing to do either with excess demand nor excessive wage increases, but is in fact driven by factors entirely beyond the control of the Bank of England, and in any case is expected to resolve itself by the beginning of next year, why is the Bank going out of its way to pursue a strategy that would lead to a recession and raise unemployment, and make the cost-of-living crisis even more acute?

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One possible answer was alluded to by Andrew Bailey, Governor of the Bank of England, last week: “We have inflation coming back down to target; and going below target actually,” he said. “But we have one of the largest upside risks to inflation in our forecast that we’ve had in the 25-year history of the Monetary Policy Committee. A lot of that has to do with the tightness of the UK labour market.”

Such “tightness” — that is, the fact that there aren’t enough available workers to fill vacant jobs — is currently driven mainly by Brexit and by the fact that since the pandemic a great number of older workers (mainly 50- to 64-year-olds) have left the job market. But it is likely to become a permanent feature of Western economies in the coming years — a result of the de-globalisation and reshoring that will inevitably see countries bring home production lines and supply chains that over the past decades have been outsourced to far-flung countries. For Western workers, this is a welcome development, as it will clearly increase their bargaining power.

But for Bailey and the technocratic elites he represents, this is a terrifying prospect: even though workers aren’t yet strong enough or sufficiently well-organised to fight for better wages, a structurally tighter labour market is liable to make such struggles much more likely in the future, especially in a context of permanently higher prices. They fear this not because it might lead to a wage-price spiral, which is unlikely, but because it would signal a shift in the labour-capital balance for the first time in half a century.

As Adam Tooze has written, what really worries technocrats like Bailey “is that inflation will emerge as a macroeconomic and, one might say, a macrosocial phenomenon. All of that is code for a world in which organised labour is stronger and in which workers receive not gratuitous handouts from socially minded employers to help with the grocery bills, but proper cost of living adjustments”. This is about more than just capitalists having to give workers a bigger share of the pie: a more emboldened labour force is also more likely to start demanding a greater voice in the management of their country’s economic and political affairs — a technocrat’s worst nightmare.

According to this view, bringing about a recession and artificially raising unemployment could be seen by the likes of Bailey as a way to pre-empt a potential rise in labour bargaining power — not only by making borrowing harder, but also by providing a cover for fiscal austerity, which Sunak has already announced. This isn’t because higher interest rates make it any harder for the government to borrow from a technical perspective — a currency-issuing government can ultimately service interest payments in the same way it pays for everything else: by issuing new money via the central bank. Rather, higher rates give the impression of making it harder for the government to borrow, due to the myths we’re constantly fed about deficits and debt. As Larry Elliott has observed: “The idea that Britain is about to be sucked into a vortex because it is running a budget deficit is a fairytale. A country that has its own currency, as the UK does, can print money to cover its spending.”

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Maintaining that fairytale, however, is crucial from the perspective of the ruling class — if citizens understood how the system really worked, they would realise that austerity is nothing more than class war. In this sense, as political economist Richard Murphy put it, the Bank of England shouldn’t be seen as operating independently of the government in pursuing these policies. On the contrary, the Bank is likely “working very closely with the Treasury to create this artificial supposed public spending crisis”.

Bailey and Sunak aren’t alone in pursuing this project. Central banks across the globe are all raising interest rates — with the US Federal Reserve leading the way. And most governments are using this to justify austerity, to some degree or another.

Now, it is often claimed that if the Fed raises interest rates, other central banks have little choice but to follow in order to avoid capital flight. But this is only partially true. Allowing the value of currencies to slide — as most of them are against the dollar, not just the pound — is arguably a better option than engineered recession: the former might lead to higher imported prices, but the latter will cause much more widespread damage, without even resolving the problem of inflation. Besides, it’s unlikely that driving economies into recession is going to bolster “confidence” in their respective currencies — unsurprisingly, the pound slumped once again against the dollar after the Bank of England’s warning of an impending depression. So much for the Bank ousting Truss in order to save the economy. That said, if other central banks were being forced into these policies against their will, we’d expect some criticism of the Fed’s aggressive monetary tightening on their behalf, and yet we’ve seen none of that.

What this really calls into the question is the notion that we need “independent central banks” to protect us from irresponsible politicians. If anything, it’s irresponsible central bankers that we need protection from. But for as long as central banks and governments are able to shift the blame onto each other, the technocrats will always have the upper hand. So, perhaps the time has come to slay the dragon — central banks themselves. A possible solution would be to consolidate monetary and fiscal policy into a single government department. At least this would make macroeconomic policy wholly accountable to voters, instead of being managed by central bankers who are largely unaccountable and dominated by vested interests. The past month has proved that technocracy has failed. The time has come to give democracy a chance.

On the one hand, he is expected to address the numerous economic problems afflicting Britain — the highest inflation rate in 40 years, an energy and cost-of-living crisis, a slow-motion housing market crash, strained public services, and growing industrial and civil unrest — while simultaneously boosting investment and economic growth. On the other, he’s expected to do all this while “restoring the confidence of the markets” by “fixing the country’s finances” — that is, reducing the government deficit and debt through higher taxes and/or spending.

These two objectives can’t be reconciled. Addressing the economic and social crisis, as well as mobilising the investment needed to boost growth, requires more spending, not less, which can’t realistically be offset through higher taxes. Meanwhile, attempting to balance the budget — which would mean allowing millions of households to slide into poverty, letting businesses go bust, and pushing public services to the brink of collapse — would likely make Sunak the third Prime Minister to be kicked out of Downing Street in as many months.

The good news for Sunak is that this is a false dilemma. The UK’s public finances don’t need “fixing”. As a currency-issuing nation, Britain can never “run out of money” or become insolvent on its public debt. I’m inclined to think that Sunak is aware of this; after all, he personally oversaw a massive increase in the deficit during the pandemic, which he paid for by having the Bank of England print the necessary pounds, essentially bypassing financial markets (and the issuance of bonds itself). The resulting debt is entirely owned by the Bank of England, and technically doesn’t even need to be repaid. There’s no reason he couldn’t do the same now.

The bad news — for Sunak and the country as a whole — is that the new prime minister can’t allow himself to acknowledge this simple truth. Not only has he long pushed the argument that his own pandemic support measures have created “huge challenges for our public finances” that now need fixing; even more crucially, in his rush to replace Truss, he fully embraced the mainstream narrative about the reason for her downfall: that she was punished by the markets for a fiscally irresponsible budget that almost destroyed the British economy — and that it’s now his job to correct her mistakes.

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This narrative is profoundly misleading. As Narayana Kocherlakota, former president of the Federal Reserve Bank of Minneapolis, recently noted: “Markets didn’t oust Truss, the Bank of England did.” He points to the fact that the fall in the value of the pound was, in the grand scheme of things, rather negligible, while the gilt sell-off was largely caused by problems inherent within Britain’s over-financialised pension funds — itself a result of regulatory failure by the Bank of England — and then exacerbated by the announcement that the Bank’s bond market intervention would be short-lived.

“[It’s] easy to see how [this] contributed to the government’s demise,” writes Kocherlakota. “She was thwarted not by markets, but by a hole in financial regulation — a hole that the Bank of England proved strangely unwilling to plug.” In other words, if the Bank of England had played ball with the government — as any central bank should be expected to, if one believes that policies should be decided by elected politicians, not unelected technocrats — there would have been no “mini-budget crisis”.

The accounts that are emerging about the “advice” that Truss received from the Treasury and other departments are even more concerning. According to a new book on her downfall, Treasury chiefs told Truss the UK risked plunging to the status of a “Third-World country”, unable to sell its debt on global bond markets, with the City “reduced to rubble”. “They scared the shit out of her,” one insider states. If true, Truss wasn’t just sabotaged by the Bank of England — but by the government’s own unelected officials as well.

Now, it may have seemed like a good strategy to Sunak to gloss over these uncomfortable truths in his bid for the party leadership. But in the coming months, he may come to regret reinforcing the regressive, and fundamentally false, narrative about the disastrous fate that allegedly awaits any government that dares to stray from the fiscal orthodoxy. With mainstream pundits on both the Left and Right, and even opposition politicians, trotting out ridiculous tropes about the urgent need to “fill the fiscal black hole”, Sunak has no choice but to engage in some degree of austerity.

This, of course, may have been his plan all along. As the underlying message of his victory speech made clear, Britain faces a “profound economic challenge” and “difficult decisions [are] to come”. Even more worryingly, it has been reported that Jeremy Hunt has been holding talks with Osborne, the architect of the devastating austerity drive of the 2010s. What might all this mean? According to some reports, Sunak and Hunt are exploring tax increases and public spending cuts worth up to £50 billion — the amount needed to balance the budget.

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It doesn’t take a PhD in Economics for one to say with some certainty that this is not going to happen: Sunak and Hunt are perfectly aware that attempting to balance the budget at a time of recession would be crazy — especially considering that there’s really “no fat left to trim” from existing public services, many of which are still feeling the effects of a decade of spending restraint and more recent pandemic pressures. Even Whitehall and Treasury officials have warned against the risk of going too far in cutting public spending or raising taxes, which is probably why Sunak has confirmed Truss’s decision not to raise the National Insurance levy by 1.25%, and why even Hunt is saying that “I don’t think we’re going to have anything like [the austerity of the 2010s]”. So, we’re unlikely to see hardcore austerity. The problem is that even austerity-lite would be damaging at a time when more spending is needed, not less.

Meanwhile, Sunak will also have to contend with the Bank of England’s commitment to raise interest rates. This won’t reduce inflation that is entirely driven by supply-side factors, but will almost certainly cause huge pain to the economy, especially to the housing market, which is already in trouble. To some extent, however, having the Bank of England play the bad cop might actually benefit Sunak, providing him with a temporary scapegoat. But, further down the road, when he may find himself having to issue more bonds to prevent the economy from tanking and public services from collapsing, Sunak may regret having empowered the myth of central bank independence. We consider it normal that crucial decisions about every area of economic policymaking should be taken by unaccountable men in grey suits. But there’s nothing normal about it — it’s just another attempt to shackle democracy.

Of course, as economist Richard Murphy noted, Sunak could tell the Bank of England to stop raising interest rates and start buying the new bonds issued by the government to cover the cost of its commitments to the British people. But that won’t happen, given Sunak repeatedly attacked Truss precisely for wanting to curb the Bank of England’s independence. To put it simply, it’s hard to see how Sunak could ever succeed given the constraints that he has, to a large degree, imposed upon himself. By feeding the myths that ultimately brought down Truss, he’s boxed himself in.

And yet, for now at least, he can always count on the “L factor” to turn his fortunes around — the fact that Labour is even more terrified of markets and wedded to those myths than the Tories. In fact, the political contest now seems to have become who can enforce the most austerity, with Labour now presenting itself as the party of “sound money” and as an antidote to irresponsible Tory spending. It’s the depressing paradox of the current era: in the midst of the worst social and economic crisis in decades, both parties have been hijacked by representatives of the establishment. The populist window that had opened with Johnson and Corbyn has now been firmly closed. But as Sunak could soon find out, it won’t stay shut forever.

Nearly 50 years ago, the oil crisis of 1973 sent inflation skyrocketing across Western countries. It was a textbook case of imported inflation, which in a context of close-to-full employment and strong union bargaining power triggered self-reinforcing inflationary pressures, as companies raised prices to defend profit margins while workers in turn demanded wage increases. This price-wage (or wage-price) spiral was a response to the inflationary pressures coming from abroad — not their cause.

However, the Seventies crisis came at a time when the “compromise” between labour and capital that had provided the bedrock for the post-war economic-political settlement was already heavily strained, as each side attempted to claim a greater share of a shrinking cake. Economic and political elites realised that the inflationary crisis provided them with the perfect opportunity to deal a deadly blow to the post-war full employment regime, which in their view had led to the working masses becoming too powerful. They concluded that it was time to strike back — to break the back of organised labour and reassert the unfettered power of capital over society.

Inflation represented the perfect casus belli. With the theoretical backing of monetarist economists such as Milton Friedman, they crafted a narrative that blamed all economic problems — beginning with inflation — on excessive union power, unreasonable wage demands by workers and bloated welfare systems. The neoliberal counter-revolution had begun, a crucial aspect of which was the deliberate engineering of unemployment through a radical tightening of monetary and fiscal policies, in order to crush the bargaining power of unions. Combating inflation was not the end — it was the means.

As Alan Budd, economic advisor to the Thatcher government, would later admit: “There may have been people making the actual policy decisions… who never believed for a moment that this was the correct way to bring down inflation. They did, however, see that [monetarism] would be a very, very good way to raise unemployment, and raising unemployment was an extremely desirable way of reducing the strength of the working classes.”

In many ways, the same thing is happening today. As in the Seventies, inflation is surging, threatening the post-pandemic recovery and raising once again the prospect of stagflation — the simultaneous incidence of stagnant or negative growth and accelerating inflation. And as in the Seventies, establishment economists and commentators have been quick to blame the surging prices on excess demand (people having too much money to spend), fuelled by excessive wage increases and over-expansionary fiscal and monetary policies during the Covid crisis.

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Their proposed solution is the same as that adopted in the Seventies: central banks must hike up interest rates and cut back on fiscal spending. In one word: austerity. And that’s what they’re doing. Not only the US Federal Reserve, but central banks all over the globe — including, most recently, the ECB — are raising rates rapidly in the most widespread tightening of monetary policy for more than two decades.

The problem with all this is that — again, just like in the Seventies — the recent inflation has relatively little to do with excess demand and excessive wage growth. In fact, it has mostly supply-side origins, triggered by the Covid crisis and now the Ukraine war, and rooted in the systemic deficiencies of neoliberal globalisation. From a Western perspective, the global lockdowns of 2020 and 2021 caused a collapse of global supply chains in durable goods and industrial components, as well as of cheap, flexible and abundant labour in low and middle-income countries. These foreign supply-side bottlenecks, which in turn were exacerbated in several countries by domestic supply-side bottlenecks — such as a shortage of long-haul truck drivers and dock workers in the US and UK — are the reason prices were on the rise well before the outbreak of the conflict in Ukraine.

In other words, lockdowns are to blame — not the fiscal measures adopted to dampen their effects. This is what we might call lockdown inflation, which is now flaring up once again due to the recent Chinese lockdowns.

In recent months, the Ukraine war and the sanctions on Russia have caused inflation, especially energy and food prices, to grow at an even faster pace. These price rises have several self-reinforcing causes. On the one hand, the conflict has directly disrupted exports of crude oil, natural gas, grains, fertiliser and metals, pushing up energy, food and commodity prices. These supply-side problems have been further exacerbated by the West’s utterly self-defeating sanctions against Russia, which have left European countries scrambling for more expensive alternatives to Russian oil from America and Africa — as well as by speculation in commodity (futures) markets.

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Indeed, notwithstanding the conflict in Ukraine, changes in supply and demand in themselves can’t justify the energy price increases. Global oil production, including from Russia, has actually increased compared to the same time last year (indeed, some Western countries, such as Italy, are importing more crude oil from Russia today than they have in past ten years, even though Russia’s recent decision to slash its gas supply to Europe suggests this is about to change). But energy traders, most of whom work for the world’s largest oil companies, saw the conflict in Ukraine as a perfect opportunity to hike up prices, knowing that most people would simply blame the rising prices on “the war” or even see it as “the price to pay to defeat Russia”.

This is why, as more and more people struggle to make ends meet, global energy giants such as Exxon Mobil, Shell, BP and Chevron have raked in record profits in the first quarter of 2022, far exceeding their revenue during the same quarter in 2021 — all because they are passing on ridiculous mark-up prices to consumers. As President Joe Biden recently put it, oil companies have “made more money than God this year”. Likewise, speculative activity by hedge funds, investment banks and pensions funds, fuelled by QE-induced cheap credit, rather than “supply and demand”, is also helping to drive up wheat prices, despite comfortably high global wheat stocks, raising the prospect of an unprecedented global wave of hunger. This is what we might call speculative inflation.

To make matters worse, certain mega-corporations that dominate entire sectors are able to use the (temporary) shortages, production cost increases and market chaos to raise their own profit mark-ups without losing customers — which is why corporate profit rates in the US and elsewhere have soared to their highest level since the Second World War. As even the Chair of the Federal Reserve, Jerome Powell, has said, large corporations with near-monopolistic market power are “raising prices because they can”. This is what we might call profit or market power inflation — or what some have termed “greedflation”.

Indeed, despite all the talk of the need to rein in wages to avoid wage-price spirals, the reality is exactly the opposite. As a result of the structural loss of workers’ bargaining power during the neoliberal era, workers in this new inflationary era are unable to protect their real wages, which are falling off a cliff in many countries as nominal wages grow much less than the general price level. Blaming workers for the current situation is a textbook example of victim blaming.

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In this context, raising interest rates and pursuing fiscal austerity will not only achieve little or nothing in terms of lowering price rises that are driven by primarily supply-side factors — but by depressing aggregate demand and economic activity and driving up unemployment, it will hurt wage-earners even more. Furthermore, it will “discourage investments that could ease some of the logistical bottlenecks that emerged during the pandemic crisis”, as a UN report reads — that is, long-term investments needed to increase domestic production (supply) and wean countries off their dependence on foreign imports, especially in the field of energy.

It would be naïve to assume that policymakers aren’t aware of this. So why are they pushing for such a solution? I would posit that once again, as in the Seventies, they are intent on exploiting the current inflation to engineer a recession and drive up unemployment in order to pre-empt a potential rise in labour bargaining power. After all, even if organised labour is still very weak, it is also true that labour markets — particularly in countries such as the US and UK — have been growing increasingly tight as a result of the post-lockdown surge in labour demand and Brexit in the UK. They are bound to remain relatively tight even in the future as the global economy undergoes a structural process of de-globalisation and reshoring.

In this context, recreating a reserve army of labour through austerity and engineered unemployment might be seen by capitalists as a way to ensure the balance of power between labour and capital doesn’t tilt too much towards the former, even at the cost of causing some creative destruction on stock markets — and of sabotaging the long-term shift towards a more environmentally and geopolitically sustainable model of greater economic self-sufficiency. Indeed, the Fed now predicts that unemployment will rise for the next three years as a result of its decision to hike interest rates.

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Moreover, in the EU, monetary tightening is seen by European techno-elites as a way to get countries back on the path of neoliberal “structural reforms” after the pandemic put these on the backburner. As Robin Brooks, chief economist at the Institute of International Finance (IIF), recently said: “Behind closed doors, there is a feeling that Italy’s spread has been too low for too long. That stymied needed reforms and drove away private investors who want a higher yield. So spread widening after [the recent] ECB meeting is partly by design. Back to more market discipline…” So much for the chattering classes’ talk about the EU’s post-pandemic “progressive turn” and abandoning of its neocolonial approach to economic policy.

So what might an alternative labour-driven rather than capital-driven response to the current inflationary crisis look like? There’s no shortage of tools that would shift the burden of the adjustment on the strong — the corporate pandemic and war profiteers — rather rather than on the weak: workers and low-income families. In the short term, as the Dutch economist Servaas Storm writes, “temporary strategic price controls, accompanied by supply-enhancing policy measures, can be used to eliminate corporate profiteering and prevent key prices (of energy and food) from shooting up”. These include price caps on fuel, energy and basic food items. This would force corporations to accept a reduction in their profit share, while allowing the labour share of income to rise.

Meanwhile, financial regulation cracking down on excessive speculation in energy and commodity markets would help lower inflationary pressures coming from financial markets. Redistributive fiscal policies, the opposite of austerity, are also needed to shield vulnerable groups from the higher costs of energy, fuel and other basic goods. And in the longer term, inflation control must be unconditionally subordinated to broader societal aims, such as boosting domestic supply and making economies more self-sufficient and less dependent on foreign imports. Ultimately, the debate about inflation is not really about inflation — it’s about the future of capitalism. And perhaps of the planet itself.

And yet despite this growing resentment, despite the fact that a majority of voters want him to resign, there’s every chance that Johnson will cling on. Yes, if the Met Police’s soon-to-be-published report on his alleged Covid breaches reveals that he misled parliament or lied to his own backbenchers, he is probably toast. But if it gives him enough wriggle room to survive, it will take the wind out of his rivals’ sails — and the PM will live to fight another day, and another election.

On that score, things aren’t quite as a bad as they first seem for Johnson — especially when you compare his position in the polls to Keir Starmer’s: 46% of people trust neither Johnson nor Starmer to tell the truth; 26% trust Starmer more than Johnson; and 14% trust Johnson more than Starmer. Of course, there is still a gap. But even immediately after the 2019 general election, Johnson had a net-negative trustworthy rating. Nobody voted for Johnson because they thought he was an honest politician. His dishonesty is priced in.

Similarly, voters are not overwhelmingly convinced that ditching Johnson would help the Tories: 34% think the Tories would be better off without him, compared to 48% who believe they would be doing the same or worse. Among Conservative voters in 2019, those figures are 23% and 66% respectively. Nor are voters warming to Starmer — just one poll this year has given him a net-positive approval rating. IpsosMORI, who remove the “neither” option in their satisfied/dissatisfied question, find a -15% satisfied rating for Starmer.

What about the latest YouGov poll, which gives Labour a six-point lead and finds that Starmer’s party is keeping 65% of its 2019 vote, versus just 52% for the Tories? Well, it’s worth noting that 25% of 2019 Tory voters say they “don’t know” who they’d vote for, compared to just 11% of Labour voters. This is important — “don’t knows” are excluded from headline voting intention figures, so the Conservatives could be in a stronger position than we think. One pollster which does not do this is Kantar; since the North Shropshire by-election they have, on average, found the Conservatives to be 2 points higher than other pollsters (and Labour nearly 1.7 points lower).

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So, if Boris is in a stronger position than we think, how should he use it to his advantage?

Since 2019, political scientists have largely responded to this question by wheeling out hackneyed truisms about mystical Red Wall voters. These voters, we’re told, are a unique fighting force, chomping at the bit to fight Johnson’s culture war. But that’s a myth; they are not more anti-woke than Tory voters in general, nor do they differ significantly on economics.

Indeed, the original purpose of the ‘Red Wall’ moniker was that it represented seats which, given their socio-demographic make up, should have voted Tory anyway. The question was not why these seats turned Conservative in 2019 — it was why they were not Conservative long before 2019.

If he’s to succeed, Johnson needs to remember what this Conservative voting coalition cares about. At the last election, Brexit was the most important issue for voters, leave and remain. Now, only 15% of leave voters think it is one of the top three most important issues; for Remainers, that figure is 32%. Brexit will not deliver the next election for Boris — but playing on traditional Tory strengths might.

Nowhere, for instance, is the divide between Tory and Labour voters starker than in the issue of immigration and asylum. For Tory voters it is the third most important issue (at 46%), whereas for Labour it is ninth (at 8%). You would struggle to find any voter who thinks the government is doing a good job on asylum seekers crossing the Channel — even 77% of Conservative voters thinking the government has handled it badly. So if Johnson wants to shore up his Tory base, a good place to start would be putting Home Secretary Priti Patel on notice: stop the boats or lose your job.

Then there’s the economy, which is rated one of the top three issues by 55% of Tory voters, compared to 45% of Labour voters. Johnson’s coalition is sceptical of how the economic system is structured: while they do not necessarily believe in income redistribution, they do think the system is rigged in favour of the rich, and that ordinary working people do not get their fair share. Generally speaking, Conservative voters are much more Left-wing than Conservative MPs.

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So perhaps more than anything, the most pressing concern for Johnson should be levelling up. After “getting Brexit done”, levelling up formed the core of the Conservatives’ offer to the electorate. Yet it took more than two years for the government to get around to defining exactly what it means, let alone release a white paper on the subject.

It’s hardly surprising that voters are not convinced: 44% think levelling up will lead to no change in spending in their area, while 18% think it will lead to lower levels. Just 7% think more money will flow as a result. The figures are broadly the same among Tory and Labour voters.

One reason for New Labour’s landslide victory in 1997 was that the public wanted more money spent on public services — 18 years of Thatcherism had left them in a perilous state. Cameronite austerity has done the same today: all the signs suggest that voters want to see a difference by the end of this parliament, otherwise they will lose faith in the government’s promises.

Despite this, the Government is caught up in arguments over funding between the Secretary of State for Levelling Up, Michael Gove, who wants more money, and the Chancellor, Rishi Sunak, who is saying no. But levelling up — undoing decades’ worth of inequality — cannot be done on the cheap.

For Johnson, there is an obvious solution to this. If levelling up is to be his legacy, it is currently under threat from Sunak’s penny-pinching instincts. So a true government reset — one that would send a clear signal to voters about his commitment to ending the North/South divide — would see Johnson sack Sunak and replace him with a true believer in levelling up: someone like Michael Gove.

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Sunak’s much-touted popularity may make Johnson think twice about this, but support for the chancellor is overstated. It is, after all, difficult to be anything but popular when you’re paying people to stay at home, or subsidising their dinners out in the middle of summer. But since the rush of cash has disappeared, his approval rating has begun to fall — from a net 43% positive in April 2020 to just 2% in December 2021.

If Johnson survives the consequences of the Met’s report, he will probably live to fight the next election. By then Partygate will have faded and the PM will need to point to a series of policy wins that his voter coalition wants: most of which involve spending more money. Now is not the time for a self-declared fiscal conservative to sit in Number 11. If Johnson wants to win in 2024, he needs to put voters’ money where his mouth is.

Today’s sin-eater is yesterday’s cake-eater: the Prime Minister who not long ago was being castigated for not imposing lockdown rules swiftly enough, and is now being berated for never really believing the rules. Meanwhile, no one respectable wants to look at whether the rules he imposed, with overwhelming public support, were themselves worth the price.

The rules were harsh and the No. 10 breaches were numerous: “socially distanced drinks”, boozing on the eve of Prince Philip’s funeral, leaving and Christmas parties, cheese and wine. The list goes on; but the minutiae are less important than the cumulative sense that the Government, presided over by Johnson, carried right on with normal, sociable working life while the rest of the country dutifully took the lockdowns literally and endured a self-imposed state of alienation, isolation and misery.

No doubt some measure of the resulting media feeding-frenzy is powered by people who raged at Johnson’s Brexit-era political untouchability. His haute Remainer haters are hugging themselves with glee to find him now not only touchable, but downright tarnished.

This group would try to turn Boris forgetting to put the loo seat down into a resignation offence. But beyond this Greek chorus, Partygate has cut through all the way to the sensible people who take even less of an interest in Westminster court politics than I.

Some of this is about offences against the British sense of fair play. After the Great Crash, David Cameron declared that “we’re all in it together”, a slogan regularly flung back at him when (as was often the case) his policy decisions seemed to fly in the face of this high sentiment.

If Cameron’s austerity demanded a straitening of the public purse-strings, our pandemic-era leaders demanded an equally austere straitening of the public heartstrings. We were asked, in the name of social solidarity, to accept a brutally thin gruel of human contact and intimacy. And now public outrage is driven by the same feeling that we’re not ‘all in it together’, and never were.

Beyond the fury, though, lies something deeper yet, and far more uncomfortable: a need for absolution.

Richard Munslow, the last known sin-eater, died in 1906. But the work of French philosopher René Girard suggests we’re less removed from the practice of singling out one individual to carry the weight of collective wrongdoing than we might imagine.

In Things Hidden Since the Foundation of the World (1978), Girard argues that human societies long ago developed what he calls the “scapegoat mechanism”, as a means of keeping social rivalries in check. Where tensions threaten to boil over, he suggests, a group will instead resolve them by focusing anger and hostility on a single individual.

Today, social tensions are certainly high – and pandemic measures a central battleground. Some in our increasingly politicised debate claim Covid is a “plandemic” pushed by plutocrats, or that vaccines are unsafe, and merely an element in a “New World Order” conspiracy between government, finance and Big Pharma.

On the other side, supporting public-health measures has also become a political identity. For the most zealous, it’s no longer even really about science: I have argued that, for some, vaccination has taken on a social meaning wholly independent of the vaccine’s actual function, that’s less about public health or infection control than spiritual purity.

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But we didn’t get here all at once. On March 9, 2020 Italy imposed a lockdown, and on March 23, Britain followed suit; but the slide toward today’s bien-pensant restrictionist orthodoxy wasn’t immediate. Into April that year, it was possible to argue in the Guardian that borders should stay open and that masks don’t work.

But by then the public was already under lock and key. It felt like a moment of national crisis, and the moral pressure to “do your bit” was powerful. It also swiftly took on a censorious edge, with surveillance drones over the Peak District, a scenic lake dyed black to deter anyone in search of a pretty view, and police forces setting up easy ways for people to dob their neighbours in.

The cost of this mass collective effort at austerity of the heart was innumerable tiny moments of alienation. People tried to educate five-year-olds on Zoom, or denied them birthday parties. Large families were banned by the rules from seeing grandparents. There was the little old lady fined for sharing a socially-distanced cup of tea in her communal garden. People died alone in hospitals, or struggled, unsupported, with illness and disability.

People reported seeing their aged parents, locked away in care homes for their own safety, visibly dying of loneliness. A nurse was arrested for trying to take her 97-year-old mother out of a nursing home, so she didn’t have to wither away in isolation like that.

We all suffered, and nearly all agreed to it. Now, as even the Covid-maximalist Guardian reports that Omicron seems to be waning as rapidly as it waxed, the question rears its ugly head: was any of it worth what we suffered? Were we right to assent collectively to austerity of the heart?

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Re-opening that question would mean revisiting every extra instant of loneliness or abandonment experienced over the last two years, in the name of public health. Every instant borne disproportionately by the members of our community oldest, youngest, poorest or the most in need of care – and that every one of us went along with.

I don’t know if it was worth what we suffered. But the behaviour of Boris Johnson suggests he was never entirely convinced. So now we’re angry with him. The Labour Party tweeted a quote from “Jenny”, an NHS nurse, who described how a man ‘begged, wept, shouted to be let in, but we said no – for the greater good of everyone else.” The man’s wife then “died unexpectedly and alone, as the Government had a party.”

A funeral worker broke down in tears on LBC, describing to James O’Brien how he felt ‘like an idiot’ for stopping weeping, bereaved people coming into funerals, to mourn their dead loved ones.

Electoral politics likes to pretend that whatever policy is being offered won’t come with any downsides. Johnson himself is famed for such “cakeism”, which he brought in spades to the Brexit campaign. But as Rafael Behr pointed out recently, the pandemic has forced us to confront the fact that sometimes there are no cost-free choices.

In Behr’s view, the cakeist error was clinging to “liberty” when we needed was swifter and more decisive restrictions. Such measures as were imposed were, for the most part, followed in good faith: the nurses turning sobbing relatives away from wards where their loved ones lay dying did so out of concern for the patients in their care, not a sadistic wish to sever the bonds of family.

But lurking in the background of all the rage now pouring out at Johnson lies the opposite possibility: that perhaps all that alienation and misery didn’t make enough difference in the end to have been worth it.

Is this true? We’ll never know. We made the choices we made. And now, thanks to Johnson’s metamorphosis from our leader to our sin-eater, we don’t even need to wonder. All of it was his fault, all along.

It is generally believed that the Italian president performs a purely ceremonial and symbolic role, and throughout most of Italy’s life as a republic this has been largely the case. Italy, after all, is supposed to be a parliamentary democracy, with the government dependent on the confidence of the elected legislature.

And yet, in his official capacity as the “guarantor” or “guardian” of the constitution, the president holds considerable power: governments are required to obtain the “approval” of the president, who also nominates (“approves”) the prime minister and his cabinet ministers. Moreover, all laws passed by parliament have to be approved by the president, and he or she is also charged with signing off the dissolution of parliament, for example following a government crisis and loss of parliamentary majority. This means the president effectively decides whether elections should be held or not.

Nor does the president’s power stop there: the incumbent also ratifies all international treaties, and serves as commander-in-chief of the army and as the head of the governing body of the judiciary. The president also wields influence through the technocratic structures of the Ministry of Economy and Finance, particularly the all-powerful Accounting Office (Ragioneria Generale dello Stato) and the Bank of Italy.

It’s not, therefore, an inconsiderable source of power — especially in times of crisis, when the political system is incapable of delivering viable solutions and the president’s role tends to “expand”. Given the quasi-permanent state of political and economic turbulence that Italy has been mired in for at least a decade, it’s no surprise that the president today has evolved into a full-blooded political actor, with the power (and willingness) to intervene in the country’s decision-making process.

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But this transformation has been long in the making, and can be traced back to Italy’s gradual integration into the European Union and the euro, beginning in the early Nineties. For any country, membership of the euro means that the role of government — and therefore of parliament — increasingly becomes that of rubberstamping often unpopular economic decisions taken at the European level. This has inevitably entailed a process of state reconfiguration involving the strengthening of executive and technocratic powers at all levels, including that of the president, and the consequent marginalisation of parliament. Typically, this is presented as a necessary precondition for the swift and efficient implementation of the kind of economic policies enforced by the EU: fiscal austerity, wage moderation, and pro-market liberalisations and privatisations.

Once the choice was made by Italy’s elites to join the euro, it also became necessary to defend their decision from any possible popular-democratic challenges. And so the president’s role was transformed in another way: from guarantor of the constitution to guarantor of the country’s “international obligations”, in particular those to EU treaties and rules. Finally, the transfer of economic prerogatives to the EU meant that political parties, even if they managed to secure a majority in parliament, increasingly found themselves lacking the economic tools necessary to maintain societal consensus.

A system of quasi-permanent social and political instability was born, with the president adopting an increasingly “activist” role in the name of “stability” and “governability”. In short, Italy’s euro membership effectively set in motion a unique case of institutional transition from one form of democracy to another: from a parliamentary regime to a de facto presidential regime in which the legislature performs a marginal role.

This became particularly evident under the double term of Giorgio Napolitano (2006-2015), which coincided with the turbulent era of the post-financial crisis fallout. During that period, Napolitano became the “quiet powerbroker” of Italian politics, with critics referring to him as “Re Giorgio”, or King George. It is generally accepted, for example, that Napolitano played a crucial behind-the-scenes role in the “international coup” — involving, among others, the Bank of Italy, then-president of the ECB Mario Draghi, Angela Merkel and Nicholas Sarkozy — that led to the downfall of prime minister Silvio Berlusconi and his replacement by technocrat Mario Monti, personally chosen by Napolitano himself. Monti’s government was widely referred to as “a government of the president”.

Napolitano’s successor, outgoing president Sergio Mattarella, followed in his footsteps. In 2018, following an alliance between the Five Star Movement and the League, the two parties, as required by the Italian constitution, submitted their choice of government ministers to the president for approval. Yet their proposed economic minister, Paolo Savona, was vetoed by Mattarella due to his euro-critical stance, forcing the two parties to opt for the more status quo-friendly Giovanni Tria. As the law experts Marco Dani and Agustín José Menendez noted at the time, this would seem to point to the existence of “a form of ‘convention’ according to which political parties or coalitions that are critical of the existing economic and monetary arrangements within the eurozone cannot get into government. Or, more accurately, they are entitled to govern [only] in a tamed form”.

More recently, when Matteo Renzi pulled the plug on the Giuseppe Conte’s second government last January, Mattarella refused to dissolve parliament and call for early elections, instead working behind-the-scenes to ensure Conte’s replacement by Draghi, much like Napolitano had done with Monti a decade earlier. Indeed, according to several sources, Mattarella and Draghi were directly involved in the machinations that led Conte to step aside, with Renzi eventually moving away only once he had obtained reassurance from them that the former central banker was ready to step in.

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And over the past year, Mattarella has gone out of his way to vocally defend practically every policy of the Draghi government, including the more legally and constitutionally shaky ones — such as the introduction of vaccine passes and a de facto vaccine mandate, as well as the maintenance of a semi-permanent state of emergency and the strengthening of Draghi’s authoritarian and anti-democratic grip on the country. In other words, the president today no longer even pretends to be a neutral arbiter of the constitution. It’s not only taken for granted that he plays a deeply political role, but indeed the Italian elites increasingly expect him to do so: to use his king-like powers to uphold the status quo and keep “the barbarians” at bay, be they euro sceptics or vaccine sceptics.

In light of the above, the importance of the upcoming presidential election comes into sharp focus. With general elections scheduled for 2023 (and the possibility of a Right-wing majority), an unfolding post-pandemic social and economic crisis, growing opposition to draconian Covid measures, and a structural reform agenda which the EU expects Italy to implement in exchange for the meagre Next Generation EU funds, it’s clear that securing a man of the establishment in the role of president is essential for Italy’s pro-EU elites. Long before the pandemic, Draghi was seen as the natural successor to Mattarella. But his appointment as prime minister last February has made a potential transition more complicated.

If Draghi were to be elected president, the parties that make up the coalition government would have to agree on a replacement prime minister to see the government through until the end of the parliamentary term in 2023. However, it is widely believed that without Draghi it would be very hard to ensure the survival of the current “government of national unity”, which includes practically all parties except Giorgia Meloni’s Brothers of Italy. And since no one (except maybe Meloni, who is currently topping the polls alongside the Democratic Party) wants to go to early elections — and also because dissolving parliament before next September would mean that MPs would lose their hefty annuity pensions — in the secret of the ballot box many MPs might choose to vote down Draghi.

In the unlikely event of early elections, it’s very hard to fathom what the scenario could be: with Berlusconi’s Forza Italia now closer to the liberal-centrist Democratic Party than to its formal allies, the League and Brothers of Italy, securing a Right-wing majority might prove difficult. This opens up the prospect of yet another “technical” or “national unity” government, overseen by Mario Draghi, now in the role of all-powerful king-president.

And this scenario isn’t entirely implausible even if elections aren’t held until 2023. Even for those parties still betting on securing a Right-wing majority at the next elections, there would be a clear advantage in having Draghi as president: the “approval” and “supervision” of the former ECB leader would prove essential in safeguarding the government against any backlashes from financial markets or the European institutions — a fact that in itself says a lot about the democratic implications of euro membership.

Draghi himself recently signalled that he would be willing to become president, and explained that parties shouldn’t worry about future governments straying from the path of neoliberal righteousness: “We have created the conditions for the work to continue, regardless of who is [in government]”, Draghi said, essentially confirming that elections are of relatively little important these days, since the decisions that matter are taken elsewhere, namely in the technocratic apparatuses of the state charged with implementing EU dictates. Whether this will be enough to reassure MPs remains to be seen. Draghi’s election is not, for now, a foregone conclusion.

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Another option would be for Draghi to continue serving as prime minister until the end of the current parliament in February 2023. That would allow him to oversee the initial implementation of the EU’s reform agenda while a coalition of parties — potentially comprising the PD, the Five Star Movement, other smaller parties, and maybe even Forza Italia — work on a political platform that would furnish Draghi with a new majority in the next general election. In this case, it’s hard to predict who the next president might actually be. The only person actively campaigning for the election is Silvio Berlusconi, who has always dreamt of becoming president. But it’s unlikely that such a divisive personality will muster the broad support needed to become president.

Some have also posited a “creative” solution to get Draghi elected president while saving the current government: electing Mattarella for a second mandate until 2023 and then have him step down for old age and pass the ball to Draghi. Indeed, in a telling demonstration of just how desperate the Italian establishment is, opera-goers at Milan’s La Scala theatre recently greeted President Sergio Mattarella, who was in the audience, with chants of “bis” and “encore”, imploring him to serve another term.

It was proof that whatever happens in the upcoming presidential election one thing is clear: Italian democracy has become a largely elitist affair, in which warring factions of the establishment vie for power, while the majority of citizens don’t even bother to vote anymore. It’s no surprise that global elites today look to Italy as a model – The Economist even went as far as crowning Italy “country of the year”. Many of its citizens, however, would beg to disagree.

But, although it seems to have slipped the minds of the EU’s finance ministers at their meeting yesterday in Brussels, the truth is that the scope of the bloc’s support package has been wildly overblown. The IMF puts the EU’s discretionary fiscal stimulus at a paltry 3.8% of GDP — a figure dwarfed by the massive discretionary fiscal stimulus of 25.5% of GDP in the US.

The same chasm between narrative and reality can be seen with the much-vaunted Europe-wide “recovery fund” known as Next Generation EU (NGEU). Despite the fanfare, it amounts to barely 5% of the EU’s GDP. What’s more, the funds will be disbursed over the course of six years, resulting in, at best, a fiscal expansion of around 1% of GDP on average between 2021 and 2024. And that’s compared to a GDP loss for the EU as a whole of around 15% just in 2020.

Predictably, the funds come with very strict troika-like conditions attached. They are conditional on compliance with the European Commission’s infamous country-specific recommendations, which in the past have consistently demanded that governments cut public spending — especially on social expenditure (particularly pensions), healthcare and unemployment benefits. This is ultimately what the NGEU is all about: increasing Brussels’s control over the budgetary policies of member states and strengthening the EU’s regime of technocratic and authoritarian control. It’s the EU doing what the EU does best.

So overall we can say that the pandemic has not resulted in any radical rethinking of policy at the European level. Neither has it resulted in any structural change. Indeed, the old fiscal rules are set to be reinstated in 2023. Even though there’s much talk of “reforming the EU’s fiscal rules”, the truth is that everyone knows that serious treaty reform is off the table — as Valdis Dombrovskis, executive vice president of the European Commission, has repeatedly stated.

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It’s not just the opposition of the so-called frugal countries — the Netherlands, the Nordic countries, the Baltics and Austria. Anyone who expects a change of heart from the new German government is also bound to be disappointed. Olaf Scholz, Angela Merkel’s successor, is, as Wolfgang Münchau has noted, “a staunch fiscal conservative, on a par with his predecessors, Wolfgang Schäuble and Peer Steinbrück, the Social Democrat behind the debt brake”.

Moreover, regardless of who takes over Jens Weidmann’s role at the Bundesbank, growing inflationary pressures in Germany — in September, inflation hit a 29-year high of 4.1% — mean that fiscal hawks will easily gain the upper hand in the debate. Regardless of the actual cause of inflation (which is largely a result of the massive supply chain disruptions happening around the world), German fiscal hawks will blame it on overspending — with cuts being the only solution.

So, all things considered, we can expect a return of austerity to Europe in the near future. Indeed, it is already taking form. Mario Draghi’s Italy is a case in point. In the current debate, the EU’s most indebted country is often presented as a champion of flexibility and European fiscal reform. However, the reality is quite different. Italy’s latest budget report forecasts a huge deficit reduction — from 10% to 4% of GDP (more than 100 billion euros) in little over a year. Italy’s age of austerity, then, seems far from over.

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A return of austerity to Europe as a whole would be devastating, especially given that many countries are still recovering from the post-2008 austerity shock therapy. That experience didn’t just prove to be a colossal failure in economic terms but also led to nothing less than a social and humanitarian catastrophe, particularly in those countries that were subject to the “economic adjustment programmes” (EAPs) demanded by the EU-led troika: Greece, Ireland, Portugal, Spain and Italy (which was never officially in an EAP but saw the imposition of EAP-like policies by former European commissioner Mario Monti, who came to power through an EU-orchestrated “soft coup”).

Numerous reports over the years have confirmed that the budget cuts and tax hikes implemented in these countries disproportionately hit the poor and are directly responsible for a dramatic rise in inequality and unemployment levels (especially among the youth), as well as rates of suicide, poverty (including child poverty), severe material deprivation, homelessness, social exclusion and distress. Even a report from a few years back by the European Parliament’s own employment committee claimed that “the austerity policies and the structural reforms imposed in the troika countries have led to a real social tsunami of massive unemployment (it has tripled in some countries) especially among young people, the closure of hundreds of thousands of companies, mainly SMEs; and a sharp rise in poverty and social exclusion”. These policies have in many respects undermined the very material bases of democracy, leading to social and economic instability.

In recent years, some countries have introduced measures to cushion the effects of austerity. In Italy, for example, the Five Star Movement-League government that emerged from the 2018 elections — which was first and foremost a rebuke of the parties that had administered the disastrous austerity policies — introduced two major policies that went in that direction: a “citizenship income”, a form of income supplement for poor households, and a pension reform lowering the retirement age.

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Both those policies are now under threat from the techno-authoritarian government led by Draghi, who is, let us not forget, one of the chief architects of the EU’s post-2008 austerity framework. A new reform raising once again the pension age has already been announced, and the ranks of those in the Government calling for the abolition of the “citizenship income” continue to grow.

This would leave millions of families with no support whatsoever, in an economy that has been ravaged by 18 months of pandemic. But punishing the poorest and weakest members of society for crises they have not caused — first the financial crisis, now the Covid crisis — has long been standard policy, in Italy and elsewhere. As the saying goes, the strong do what they can and the weak suffer what they must.

The Conservatives can lay claim to be the world’s oldest and most successful political party precisely because, in order to hang on to power and prevent (or at least limit) any truly significant redistribution of power and wealth, they have always been prepared to mix and match policies in way that both appeals to a wide electorate and also makes pinning them down ideologically feel like trying to nail jelly to a wall.

Admittedly, at first glance, the impression of a party totally transformed is easy to run away with. After all, Cameron and Osborne, as well as insisting on balancing the books no matter what the cost to the nation’s deteriorating public services and rising poverty levels, were often portrayed as modernisers hell-bent on dragging the Tories kicking and screaming into the 21^st century. Johnson on the other hand, whatever the cosmopolitan image he worked hard to create as Mayor of London, seems happy to cosplay the authoritarian populist — the leader of a party determined to engage in a ‘war on woke’, to defend the interests of businesses big and small, and to allow nationalism to trump his party’s traditional commitment to economic rationality.

But let’s look, first, a little closer at the Conservative Party under Cameron. Sure, it brought in equal marriage after it made it into government in 2010. But it had to rely on the votes of the opposition Labour Party to do so, since so many of its own MPs rejected the change. Similarly, while Cameron in opposition began by hugging huskies, he ended his time in Number Ten by demanding his colleagues “get rid of all the green crap” — meaning it was left to his unfortunate successor Theresa May to commit the country to net zero. Meanwhile, Cameron’s Conservatives also spent a great deal of time and effort both bringing in draconian policies (accompanied by equally draconian rhetoric) to try and crack down on immigration and badmouthing the European Union — all of which helped fuel the rise of UKIP and ultimately led to Cameron’s fateful decision to call the 2016 referendum.

As for austerity, there is no doubt that it was a reality after 2010 — but far more so for some parts of the state, and some people, than others. The NHS, as it may do now, escaped the bulk of the cuts foisted on so many other public services, while folk on pensions — unlike younger people and the poor — actually did relatively well, presumably because they constituted (and continue to constitute) such an important part of the Conservatives’ voter coalition. Admittedly, policing did suffer cuts, but that didn’t stop the party under Cameron continuing to call its main opponent ‘soft on crime’, as well as framing Labour as the party of immigrants, Europhiles, students, the chattering classes and supposedly work-shy welfare claimants.

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So what about the party under Johnson? True, Sunak has raised rather than cut taxes, including corporation tax — a move which, notwithstanding reliefs on R&D and temporary cuts to high-street business rates, some pearl-clutching neoliberals will doubtless still insist on seeing as the very incarnation of Johnson’s characteristically unguarded (but also characteristically pretty meaningless) “Fuck Business!” remark. But few if any of those tax rises is remotely progressive, not least the increase in National Insurance which the party pretends will ‘fix social care’ (it won’t). Nor is there any serious suggestion of moving to tax wealth or property to anything like the extent that a serious rebalancing of the economy would require. The hike in the National Living Wage is, of course, welcome, although let’s not forget that it was George ‘austerity’ Osborne who invented the concept in the first place!

Meanwhile, Sunak rescinded his boost to welfare benefits prompted by the pandemic as soon as decently possible — a decision which, for those not in work, will not be compensated for by his eye-catching (and indeed welcome) reduction in Universal Credit’s taper rate. Nor is the Government providing anywhere near enough funding to help poorer pupils who missed so much school catch-up. The same arguably goes for climate change policy, where, especially after the Government’s policy announcements in the run up to COP26, it’s getting harder and harder to escape the feeling that the Tories under Johnson, not for the first time, seem happy to will the ends but not the means.

As for spending more generally, while capital spending and infrastructure projects have received an expected boost, day-to-day government spending (much of which filters down, or rather doesn’t filter down to local authorities) is going to be as tight as ever, making the Government’s endlessly repeated talk about ‘levelling up’ a little hard to credit — unless, of course, we’re talking about money funnelled not to those most in need but to those constituencies in the Midlands and the North which flipped to the Conservatives in 2019 and which Johnson and his colleagues are understandably desperate to hold onto.

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For all that, barring an economic meltdown in which the cost-of-living crunch really does become a crisis and the various trading frictions associated with Brexit get worse rather than better, they stand a pretty good chance of doing so.

The voter coalition that Brexit enabled Johnson to build is made up of older voters, of sometimes ethnocentric, not particularly well-educated, intensely patriotic voters living in small towns, and of more affluent voters in already well-served parts of the country who (if they are better-educated and so socially more liberal) are prepared to set aside their discomfort with the Brussels-bashing and the culture wars so long as their taxes are kept reasonably low and their precious house prices kept high. And, like Brexit — indeed precisely because Brexit continues to simmer even if it no longer boils — that voter coalition, whose geographical distribution is nicely suited to Britain’s first-past-the-post electoral system, doesn’t seem done yet.

Certainly I wouldn’t bet on those voters taking seriously against the Budget even if it doesn’t fall hook, line and sinker for Sunak’s ‘new age of optimism’ line as much as his adoring fandom in the Tory-supporting press. They know, we know, that this is the British Conservative Party — doing whatever it takes, two-and-a-half centuries and counting. Rishi or no Rishi, there is nothing new under the sun.

Those who use the foodshare live at the top of the hill in the Penbeagle estate. It is run by the St Ives Community Orchard inside the St Ives Rugby Club, which donated their premises for free. They collect waste food from local supermarkets and give it away, so it doesn’t go into landfill. Unlike foodbanks, of which there are many in Cornwall, you do not need a referral from an agency, which will take your testimony and, if you are judged worthy, issue a chit. You just show up.

There are trestle tables covered with produce: a pile of potatoes and carrots (the only glut here, how British); a few onions; oranges, bananas, apples, and lemons; yesterday’s wilting pastries from the Co-op; four ham and cheese quiches; eight packets of miniature sausage rolls; one pack of noodles; four packets of mashed potatoes; three tins of vegetables; four rice puddings; five packets of crisps; one small box of salad.

Anyone who thinks this is mere bounty, something to be unconditionally celebrated, doesn’t understand food poverty, by which I mean poverty. This food is given with love and concern, and often collected by those who use it themselves. But it is remnants. There is no fresh meat except one packet of sliced beef; no fresh bread; one box of eggs and no butter, fish, green vegetables or milk. What is here is only what others do not want and cannot sell; at the end anything that is left is fed to pigs

I watch a man with two small children walk about, considering what to take; often people think they are not the most in need, and take too little. I see a girl, perhaps 11, with an empty carrier bag and an expression so defeated I am shocked to see it in a child and, later, I do cry, which shames me further. Tears are cheap, and I don’t cry after subsequent visits: immunity is easily caught here.

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The children are keen to help. Why wouldn’t they when their parents walk so heavily with their fear, as if carrying a great physical burden? But their chirping is stilled. Here there is no joy in the having; that is a fantasy for people who do not use these places. There is too much pain in the needing. Initially this foodshare was used by people who simply didn’t want to waste food. Increasingly it is used by people who could not survive without it.

No one smiles except the volunteers who grin brightly, for denial. It is quiet, speechless almost, like a deathbed. Just a murmur of thanks and a wave as they go out into the rain. Then a woman with three boys snaps at them as they say what they would like and ask her, too — what she would like? I recognise what I see: not an unloving mother, far from it, but a woman who can take no more. She chides them noisily, and her voice rises further to panic; but then she gathers herself, looks at them, touches them, praises them. She returns from her terror to herself. She smiles a small, tight smile and walks away with her bags, the children trotting with her.

If you are poor, landscape is only a taunt; a physical impediment even, for the hills around the harbour are steep. Those who live in Penbeagle would have lived on the harbour once, and seen seals and maybe dolphins from their windows, but the hunger of outsiders to own a second home, rather than stay in a hotel or caravan park has pushed them up the hill into a council estate that manages, with its pale uniformity, to deny its own Cornishness. “We all live up here now,” says Jo Chatterley, a volunteer, as I drive her to the orchard with what is now the pig food. “Some people don’t even go into the town in summer. They don’t feel welcome”.

The natives of St Ives can no longer afford the picturesque. They are no longer considered worthy of it. A local estate agent called St Ives, recently named the happiest place in Britain (in a survey conducted by another estate agent) — not a town, but a business. Where does that leave people? The old trades of fishing and mining are fetishised beyond the duchy in books and novels, but one is declining, and the other is gone. It is another way of mythologising Cornwall. To mythologise something is another way of not seeing it; and you can’t eat myths.

The orchard is picturesque, though, because only pigs live in orchards; that is, it doesn’t contain any holiday accommodation. The ground is lively and sodden; the apple trees are gnarled and expressive. There are bees; a fire-pit; a vegetable garden. This orchard exists for itself, which is rare in a town which is also a business, and to counter that other epidemic that thrives amid lack: depression. People come here for their mental health; subsistence farming is considered healing, and it is, but not by itself.

Cornwall pays a price for its insane beauty. The average house price is now £254,382; in St Ives it is £100,000 more. Living costs are as high as London, and sometimes higher (the price of a return bus ticket from Pendeen to Penzance is more than £5 and if you don’t have a car you are forced to pay it or risk your life on a bike across the moor that gathers fog, and many do). Parking in summer is £5 a day or more. Restaurants and clothing cost what they always do. But wages are two-thirds of the national average in St Ives, often for a combination of zero hours and split shifts, which mean, respectively, that you cannot take another job to supplement your income, or that you are paid for a part-time job but do a full-time job with a long lunch break.

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Before pandemic, Cornish employment was higher than the national average, and the Cornish worked longer hours than the average in “jobs”, I am told, “because there are almost no careers”. In 2019, this felt like a duchy that existed for people who do not live here; then pandemic came, and employment fell. Universal Credit claimants swelled by 135% and it is not enough to live on. Food is the obvious thing to cut back on. You won’t call a bailiff on yourself.

Usually, Jo says, in St Ives you have a seven-month holiday season in which to earn enough to keep yourself through winter. This year it was three months. “You have a lot of people living pretty much on the breadline and there’s a lot of people who aren’t usually over it anyway. People went from doing all right to absolutely nothing pretty much overnight. We are helping people who aren’t used to asking for help”. She knows a self-employed builder with four children and no work this year; when his wife developed breast cancer their income fell to nothing. She knows one family of seven adults existing on one wage.

Ten miles away, in Treneere, Penzance, Liz Sullivan runs Whole Again Communities (WAC). She sits in her office, her leg on the desk (she has hurt her ankle) and tells me how WAC exists to teach people how to cook healthy food – soups, hot pots, pasta sauces – from scratch on a budget. They distribute food, offer cooking classes – in pandemic these were online – and teach gardening, giving out compost and seeds. “We are a real community of making things and managing,” she says. “They don’t go around groaning and begging. They get used to managing. They are incredibly resilient. People are trying so unbelievabley hard and it’s still incredibly difficult. People live hand to mouth. Rent in Cornwall is so incredibly dear. Everything is more expensive down here”.

Owning is unaffordable and there is almost nothing to rent, due to the profusion of holiday cottages. A Rightmove search for Penzance brings up 11 properties, and only one is under £500 a month.

Liz explains what people will do to avoid the foodbank. One single mother (her partner is dead) took a full-time job as a carer, walked to work despite her ill-health (she had no car) and left her son with his grandmother, who is shielding: “She had to forgo seeing her son [during pandemic]. That is a typical story”. This girl wanted to be a baker – she is a gifted one – but she has no premises; caring is one of the few jobs you can get. It is the same for a girl who wants to be a beautician, she says: no premises, although many of the shops in Penzance are empty.  She tells me about a chef who left his job to care for his wife, who has complex health conditions, and their three children; they now need donations of food.

“Covid-19 is just one issue,” she says. “It’s not just all of sudden that food poverty has become an issue. It’s just the way it is, and some people cope better than others”. It has been worse since 2010, she says, when the coalition government came to power. “There is, she says, “the exhaustion of living a certain way. Some people, I believe,” she pauses, “people are where they feel they deserve to be”. That is perhaps the saddest part. She shows me a letter of thanks she received, from a woman with ill-health (two of her three children also have complex health conditions): “if we didn’t have the boxes [from you], we would have gone hungry. Tom is digging up the garden and planting the carrot and courgette seeds”.

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I meet Lynne Dyer at the Growing Links community garden nearby. She runs a community store cupboard, teaches gardening to children and adults and also runs the street food project, which provides hot meals to vulnerable residents each night. Lynne knows people who are making a loaf of bread last a full week. She knows families evicted from their rental accommodation in summer for the tourist season, who have to camp in fields. She knows a sick man denied his benefits because he could walk 15 yards left destitute for a year and a half. She knows a woman who lost her job under the first lockdown unable to manage on Universal Credit. “She was feeding her children and not feeding herself. These sound like stories from Victorian times, don’t they? One thing about the Victorians – they had the poor house, didn’t they?”

And that is it: in west Cornwall people are feeding their neighbours, and kindly though it is, it cannot be a substitute for a functioning state. It is flickers of light inside a catastrophe.

In St Ives yesterday, as she set out the Christmas Eve collection, Jo was anxious to tell me that she knows of only one family that has abused the foodshare scheme. I didn’t want to include that – incidentally, the proportions are identical to the benefit fraud numbers, which are negligible — but I feel I must, because the narrative that such places are run by the politically motivated for the idle and wicked is so widespread. I understand why. It is essential to believe that, because it is absolution for the rest of us: it allows us to avoid responsibility for a child with an empty carrier bag and an adult’s eyes.

What I’m describing, of course, is the plot of the 1994 blockbuster, Speed. It’s also a metaphor for the situation in which Rishi Sunak finds himself. Like Sandra Bullock, he’s in the driving seat — in this case, of the British economy.

Sunak is building up public debt like no peacetime Chancellor has done before. He really ought to slow down or stop altogether, but if he does then, kaboom, the economy blows up.

Just imagine lockdown without the furlough scheme and all the other lifelines thrown our way by the Government. We’d be looking at depression-era levels of unemployment and bankruptcy. As bad as things are now, they could have been much, much worse.

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But, despite the impending vaccines, the danger isn’t over yet. What we have been through so far is only phase one of the crisis. Phase two will consist of the recovery period following the pandemic. And then after that, there’s phase three, in which we’ll need to find long-term answers to the underlying weaknesses of the economy.

At no stage can the Government afford to slam on the brakes. It must keep flooring that accelerator, injecting enough stimulus into the economy to maintain momentum. Obviously it must do so without crashing the whole thing or running out of money, but nevertheless the need for speed is ongoing. As he unveils the spending review, I just hope that Sunak is prepared for the bumpy ride ahead.

At this point, you might think I’m sounding very Keynesian, wanting government to spend money like there’s no tomorrow — so allow me to explain.

To put it very crudely, Keynesianism is the counter-intuitive idea that the best way to deal with mounting debt is to keep on borrowing. The justification is that debt oils the wheels of growth. Individuals and enterprises borrow to enable the investments that will make them richer in the future than they are now. They also borrow to bring forward purchasing power from that richer future — which has the added bonus of helping to create the demand that stimulates investment in the present.

Austerity, on the other hand, throws grit into the works. It not only immediately reduces the level of demand in the economy, it also creates the expectation of reduced demand in the future — causing others to withhold investment and put off purchases. Therefore, in place of the virtuous circle of credit-fuelled optimism, there is a vicious circle of money-hoarding pessimism. If lenders lose faith as a result, then interest rates go up and your debt problem becomes a whole load worse.

That’s why Keynesians believe we must spend (and, if necessary, borrow) our way out of recession — with a special responsibility on government to substitute for any lack of demand from the private sector.

It’s a strong argument, but I don’t buy into it completely and never have. That’s because not every economic crisis is primarily a crisis of demand. Sometimes, it’s more structural than that — a crisis in the systems that underpin the everyday business of buying and selling, borrowing and lending. For instance, if people lose confidence in the value of a currency — then you’ve got an inflation crisis on your hands and you have to deal with that first.

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Who will pay for this Covid catastrophe?

By Peter Franklin

13 years ago, the number one problem was a global financial meltdown. Governments had to intervene to stop the banks from collapsing one after another. The banking crisis then morphed into a sovereign debt crisis. Having panicked about the value of mortgage-backed securities, the markets panicked about the value of debt issued by countries with big economic problems. This nearly brought down another house of cards — the European single currency.

In the midst of a solvency crisis, stimulating demand is clearly not the top priority. Rather, it’s convincing your citizens that their savings are safe and the money markets that your country is still capable of honouring its debts. This means bailing out the banks and getting control over public spending. It’s only when the danger of bank runs and sovereign defaults is over that governments can even think about rekindling the ‘animal spirits’ of the economy.

That’s why, 10 years ago, when George Osborne took the driving seat, the British government made the right call. Never forget that Britain was in a perilous position. With our outsized financial sector, we were fully exposed to the global financial crisis; and, to make matters worse, our nice little earner — North Sea oil — was running dry. This was no time to test the confidence of the money markets.

Osborne (though he also made a big mistake that I’ll come back to) was right to defy his Keynesian critics. The subsequent jobs miracle would vindicate his position.

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Is it time to end the war on welfare?

By James Kirkup

So, no, I’m not a raving Keynesian. The fact is there are some economic emergencies in which the go-to Keynesian solutions are not appropriate. I’d also like to add that the online obnoxiousness of certain Keynesians really gets up my nose. Admittedly, that’s a rather less important consideration, but I mention it to make it clear where my personal biases definitely don’t lie.

It thus gives me no pleasure to admit that in the context of 2020 the Keynesians are right. We really do have to borrow our way out of this one. That’s because this is unequivocally a crisis of demand. Rishi Sunak, unlike George Osborne, must spend spend spend to stop the economy from blowing up.

In phase one — i.e. the pandemic itself — government has had to support household incomes so that employers can retain staff and workers can pay for basic necessities.

In phase two — i.e. the recovery — we’re going to have to work out how to get people consuming normally again. It’s barely been noticed, but for the first time in decades, Britain’s trade balance is back in the black. As Frances Coppola points out, that’s not because we’ve suddenly become an exporting powerhouse, but because we’re saving our money like mad.

Believe it or not, this is an age of surplus — of £3 coffees and unused gym memberships. It’s not just the top 1% who can afford the second or third family car or the second or third family holiday. Abundance, while far from universal, is sufficiently widespread to allow millions of us to spend substantially more than we need or even truly want. Indeed, a lot of spending is motivated by nothing more than habit — and habits, in this pandemic, have been broken.

As soon as those with spare cash have the confidence and opportunity to spend it again, there will be some rebound in consumerism. But we can also expect an enduring downshift in lifestyles — in some cases out of preference, in others because we have no choice but to pay off debts, rebuild savings and compensate for lost income.

It all adds up to a long-lasting loss of demand, which must be replaced if we’re to get back to full employment and anything like normal GDP. Government must be ready and willing to provide the stimulus needed to get recovery truly underway. ‘Eat out to help out’ was just the beginning — and truly radical ideas, like experimental shots of universal basic income, should be actively considered.

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Did 'Eat Out to Help Out' cause a second wave?

By AVEEK BHATTACHARYA

Obviously, there are limits. We can’t push fiscal and monetary policy much beyond that of comparable economies. If the money markets take fright, interest rates will go up — a disaster when you’ve accumulated so much debt. However, it’s not just the absolute size of each country’s debt pile that the markets are comparing. They’re also looking at other metrics like debt servicing costs as a proportion of GDP. It’s therefore really important that things like growth and productivity look good compared to other nations.

This brings us to phase three of the challenge facing us as a nation — how to tackle the underlying weakness of the British economy. In this respect, Rishi Sunak must not repeat George Osborne’s big mistake. Though the Coalition government was right to get current spending under control, it was wrong to stick to Labour’s spending plans and slash the capital budget. Instead, stimulus took the form of quantitative easing — funny money pumped into the financial sector. This helped to inflate share values and house prices, but what we didn’t get was the real investment that we actually need, the sort that supports innovation and enterprise and therefore growth.

We’ve just had a decade of ultra-low interest rates, low inflation and no pay rises. This was a perfect opportunity for the corporates to invest in the future; instead they busied themselves with share buy backs and other get-rich-quick schemes. They had their chance, so now government must lead the way. That will require the Chancellor to have some difficult conversations with his fellow Conservatives — especially over tax policy. Raising sufficient revenues in the next years will not be easy, but it makes sense to target idle wealth in preference to job creation.

Ten years ago, George Osborne had to face down his Keynesian critics, but most of those were in the Labour Party and other hostile institutions. Rishi Sunak has the harder task of taking on vested interests and free market ideologues on his own side. Nevertheless he must do so if he is to swing the power of the state behind the productive use of capital.

As long as we’re not doing really stupid stuff, like building nuclear power stations, we shouldn’t hold back on public investment or sharper incentives for private investment. It’s not that there’s any lack of work to be done. We have entire regions of the country to level up, houses to build and natural environments to regenerate. Under-investing, as we have done for decades, will only damage our growth prospects and thus make our debts less bearable.

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Covid-19 has exposed our financial fragility

By Jonathan Tepper

One has to ask whether Rishi Sunak really gets this agenda. It’s still too early to tell, but he’s already gone much further than any previous Chancellor — Tory or Labour — would have dared. He’s made the state the wage-payer of last resort and gone halves with us on lunch. Looking ahead, he sees the sense in tackling this country’s greatest structural weakness: the economic disparity between North and South.

Later today we’ll get an idea of how big a commitment this government’s willing to make, but there has been one encouraging sign. It’s reported that a National Investment Bank will be established. If true, this would reverse the most telling error of the previous decade — which was when the Green Investment Bank, only set up in 2012, was flogged off five years later to a private equity firm. As well as being an incredibly shortsighted thing to do in itself, it was symbolic of a misplaced trust in the neoliberalism that’s failed us over and over again.

While the Chancellor has an economy to save, he shouldn’t feel so protective about our current model of capitalism. Even before the virus came, it was falling to bits and running out of road.

So, let’s not blow this chance to move on.

Tories stopped fantasising about the rope because they accepted that those days were gone and it was time to move on. But all parties need a rallying cry, something to stir the blood, and it was George Osborne, who had been so keen to move on from IDS, who found it.

A decade on from that Blackpool debacle, Chancellor Osborne delighted his party — and a fair few voters — by announcing a Tory war on welfare.

“Where is the fairness, we ask, for the shift worker, leaving home in the dark hours of the early morning, who looks up at the closed blinds of their next door neighbour sleeping off a life on benefits? We speak for that worker,” he declared.

Two years later, he was back on the conference stage announcing the biggest cut of the austerity age, the benefits freeze.

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Where will Boris Johnson lead us?

By James Kirkup

And now, six years, two prime ministers and one pandemic virus later, where do the Tories stand on welfare? And where will they go next? Perhaps it’s a good thing for the Conservatives that they aren’t having a proper conference this year, the sort of gathering where Osborne used to bash idle welfare recipients. Because the Tories don’t seem able to work out what they think about welfare today.

While a lot of people now agree that austerity was a mistake and welfare cuts went too far, it’s worth remembering that they were quite popular at the time. Osborne, after all, isn’t stupid: he knew his message — welfare claimants are idle scroungers who take your taxes — would play well with the wider public. It was one of many things he learned from Tony Blair.

The British Social Attitudes Survey, the gold-standard measure of national opinion, shows that in 1997, 28% of voters thought unemployment benefits were too high; 46% said they were too low. By the time the Coalition took office, 54% said welfare for the workless was too high, against 23% who said too low.

And now? The most recent BSA figures, for 2018, show opinion is back in balance: 39% said unemployment benefits are too high, and 35% say too low. And that was long before that little virus came along and put hundreds of thousands of British workers out of jobs.

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Are graduates doomed?

By James Bloodworth

Britain’s emerging unemployment ordeal leaves Conservatives in a quandary. What do they think about welfare claimants now? What do they tell voters about those claimants? In other circumstances, a party might consult its guiding philosophy, its core ideas to help frame a response, but Boris Johnson’s Conservative Party, which has been quite willing to abandon many of the old articles of Tory faith on economics and markets since taking office, doesn’t have much philosophy left to fall back on.

For a mock of the intellectual and political exam question fast approaching the Conservatives, consider the decision to maintain — or not — the £20 a week emergency increase to Universal Credit and Working Tax Credit that was put in place in April. That’s scheduled to be withdrawn in April 2021, just as unemployment is likely to be nearing its peak. Conservatives including Stephen Crabb, former welfare secretary, and Mel Stride, Treasury select chair, say it should be extended, as does a serious coalition of anti-poverty groups led by the Joseph Rowntree Foundation. I agree, for what it’s worth.

How do Tories view claimants? The Osborne worldview saw them as idlers who had chosen not to work. Will Osborne’s successors continue to see claimants as undeserving types who chose their fate?

And whatever the evidence, some voters believed that, at least partly because that’s what they had been told, for several years, by their leaders. It wasn’t just David Cameron who talked about welfare “scroungers”. In 2011, Liam Byrne, then shadow work secretary, talked about Labour standing for “workers, not shirkers”.

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Could Covid-19 vanquish neoliberalism?

By Thomas fazi

This was amplified via the media, and serious, well-organised efforts to make sure the public were served a regular diet of stories about excessive and fraudulent claims by undeserving claimants. I was a political reporter from 2001 until 2014 and remember the regular briefings and releases from CCHQ and its friendly organs such as the TaxPayers’ Alliance, all striving to feed the narrative that welfare was too generous and claimants too lazy.

Not all Tories sang that song, of course. IDS fought Osborne for years to make UC more generous. Boris Johnson once said Coalition welfare cuts would impose “Kosovo-style ethnic cleansing” on the London he then led.

And slowly, the narrative of feckless welfare claimants faded. The Theresa May machine had no interest in maintaining it. Boris was even keener to declare the end of austerity, though his 2019 manifesto took a characteristically have your cake-and-flog-it-too view of welfare, promising both an end to the benefits freeze and a crackdown on “those who cheat the system”.

So what now for the Tories on welfare? The dark Osborne magic of castigating the feckless has faded away. What story will the Conservatives tell about the hundreds of thousands of people who are about to lose their jobs? Self-sufficiency and rugged individualism run deep in conservatism, as does the notion that people are largely responsible for their own fate. But how many Tory purists will be prepared to argue that the coronavirus jobless brought it on themselves by choosing the sort of jobs that get cut in a pandemic? It seems likely that at least some voters will regard the Covid-unemployed as jobless though no fault of their own; some might even regard those claimants as unemployed as a direct result of Government policy.

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Will the pandemic kill off libertarianism?

By James Kirkup

And if you see those claimants as blameless, you need a better welfare provision for them. That’s a long way from Osborne’s scrounger-bashing, but it wouldn’t be much of a stretch for today’s Conservatives.

The logic of Johnson-Cummings Big State interventionism — and the political imperatives of retaining those Red Wall seats — would eventually transform the Covid-era Tories into the party of a much more generous welfare offer, at least for people with a solid history of work. Before the pandemic, there was a quiet debate beginning in Tory circles about a more contributory welfare regime, where people who have paid more in get more back when they need it. Offering higher rates of welfare to some workers who lose their jobs over Covid might have superficial attractions, and might play well with voters who like the idea of reciprocity. But some Tories worry about moving towards a system that divides claimants into the deserving and undeserving poor. This debate was only starting when the virus exploded. Expect to hear more of it when the smoke starts to clear.

Could the Tories emerge from the pandemic as a party that wants to do more for the unemployed? It might not be as implausible as it might seem at first glance.

No less an observer than Professor Sir John Curtice has concluded that public opinion on welfare issues is heavily influenced by the narrative offered by politicians: “Even though it might currently find itself in an unfamiliar policy position in expanding the welfare state, it is also open to the Conservative party to develop and secure support for its story as to how the welfare state should be run in future.”

The British labour market is in turmoil. Public opinion is up for grabs. The country needs a new story on welfare. Will the Conservatives try to write it, or fudge the issue and let Starmer inherit it?

Spool forward to the present day and the contrast in politics can look almost head-spinning. Since polls closed in the EU referendum in June 2016, Britain has had three prime ministers and two general elections, in a span of time that might otherwise have seen Prime Minister Cameron in office until the May 2020 election.

Cameron, like Clegg, is a blurred memory. Jeremy Corbyn and Nigel Farage, who might interest future historians almost as much, are fading from view. Theresa May, who will not trouble posterity, is already gone.

There’s a lot to learn by looking back to that moment in the Rose Garden. The garden isn’t called that that, of course, but does that matter? It is, after all, how people have chosen to remember it. Perhaps that’s what really matters in the end.

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Not so rosy: the legacy of the Coalition government

By Peter Franklin

But I wonder if we’re learning the right lessons by looking back on the Rose Garden and the coalition.  I don’t often disagree with UnHerd’s own Peter Franklin, but I have to quibble with his assessment of the Coalition years  as “unusually — almost freakishly — disconnected from what happened next. It’s almost as if they didn’t happen at all.”

Of the main players, Peter offers this enviably sharp verdict:

“Though they were the big beasts of their era, Cameron and Clegg can be seen as an evolutionary dead-end — the last of a line wiped out by a series of cataclysmic events.”

I understand the argument, the narrative it supports, even if I don’t entirely agree with it. More of that in a moment. First, that narrative, which goes something like this: the Rose Garden moment marked a high tide for technocrat centrist elite politicians and their bloodless “new politics”.

Cameron and Clegg, public school and Oxbridge-educated fortysomethings with no real careers outside politics, were able to work together happily because they had more in common than they admitted to voters, and had few ideological convictions to impede their partnership. Together, they oversaw five years of stable government driven its very DNA towards the political centre: a bit socially liberal (gay marriage) and a bit economically conservative (austerity).

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Why did Boris Johnson survive?

By James Kirkup

The same narrative says that all those things have now been swept away by a tide of partisan vitriol, culture-wars dividing lines and politicians intent on consolidating their electoral base, not winning over opponents. Boris Johnson, you might think, is the embodied repudiation of the Coalition years. Unlike Cameron and Clegg, this narrative suggests, the current PM has no willingness to compromise with opponents or critics. Far from technocratic centrism, he’s a gut-feel guy who won his majority last year on the tub-thumping populist simplicity of “Get Brexit Done” and leads a government whose illiberalism is captured in a home secretary who used to be quite keen on hanging; the new politics has given way to the old.

Or has it? Looking back, I can’t help but feel that the drama and turmoil that has swept away many familiar characters, terminally changing their career trajectories, hasn’t really changed the fundamentals of politics quite so much.

Vitriol? Well, there’s no disputing that the tone of politics has changed, but only in degree, not nature. The idea that Politics 2010 was a Socratic debate among patricians is for the birds; the happy smiles of the Rose Garden followed the Brown years, when it was commonplace for enemies of Labour’s then leader to debate his mental health, and MPs’ expenses, which made it acceptable to address MPs as thieving toerags. Political twitter may have been a friendly clique in 2010, but wider political discourse was often toxic.

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How I learned the Tories weren't evil

By Polly Mackenzie

A change of personnel? We’re governed by different people, but not a different type of person.  You can only think that David Cameron (Eton and Brasenose, Oxford) and Boris Johnson (Eton and Balliol, Oxford) are fundamentally different sorts if you go in for Freud’s narcissism of small differences. Perhaps you think Brexit is a tectonic gulf between the two, but it’s easy to imagine (as he himself did) the world where Boris was for Remain, and equally possible to imagine the world where Cameron supported leaving. After all, DC was willing to be pushed by his party into a referendum he didn’t want; a bit more pushing might well have seen him saunter across another red line.

On the other side of the House, Sir Keir Starmer is a bit different from Ed Miliband, but they’re not members of different species; after the genuine divergence of Jeremy Corbyn, the Labour leadership is reverting to the (north London professional) mean. More broadly, the House of Commons has changed a bit since 2010, but not dramatically: there are more women, more BAME MPs and fewer privately-educated MPs. But the place is still heavy with the sort of people whose CVs look a lot like that of Cameron and Clegg.

Twitter might have changed, but politics itself is still done by much the same sort of people who were in charge a decade ago, and often done in a similar way to the same people. Many of those ‘Red Wall’ seats Johnson claimed in 2019 were also Tory targets in 2010. I spent the 2010 campaign tracking Cameron around the country; most of my days were spent in the north-west watching the man try to win over Labour voters who watched football and rugby league. On election night in 2010, a Tory friend said she knew they’d missed the majority because Gedling had stayed red. Cameron may have felt comfortable with Nick Clegg, but it’s not what he wanted. He had to form a coalition with the Lib Dems because he was unable to form a coalition of voters within the Conservative Party big enough to reach from Guildford to Gedling.

What about policy? Surely here we find support for the idea of an essential rupture between the Coalition what came after? Again, I’m not so sure. Cameron and Clegg may have looked good in the garden, but they weren’t entirely the compromising centrists that jolly press conference promised and some people now recall. In part this is because history is written by the former incumbents, several of whom are keen to play up the idea of the Coalition as driven by compassion and moderation.

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Imagine David Cameron had won his referendum

By Peter Franklin

In Cameron’s own book about his premiership, he describes his political approach as “compassionate” more than 30 times and calls himself “a genuine, moderate and liberally-minded One Nation Conservative.”

That would be the compassionate, moderate Coalition that reduced taxes for people earning £150,000 at the same time as making cuts in welfare payments including tax credits and housing benefit. The compassionate, moderate Coalition whose welfare policies led to claims that they would result in in the Kosovo-style ethnic cleansing of the poor. Those claims were made by one Boris Johnson, of course.

What about liberal internationalism?  Cameron in his book says: “My idea was to mark us out as the most open, globalised, free-trading anti-protectionist nation on Earth”. Which sounds nice, but was hardly the reality of Coalition policy.  

As for liberal internationalism, that might have been an accurate description of Nick Clegg’s personal outlook, but it was hardly the reality of coalition policy. David Cameron and his Home Secretary (remember her?) spent five years tweaking immigration rules, promising yet more crackdowns and generally blaming foreigners for stuff that wasn’t their fault.

Even George Osborne now concedes that he and his friend Dave “didn’t make enough of the value of immigration”.

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In 2010, David Cameron first fooled the country

By James Bloodworth

Cameron banged on about immigration even though his own inclinations on the issue were fairly liberal; he just thought he had to talk tough on the subject to keep party and public happy. Draw your own comparisons with the current PM.

A pro-European coalition? Pull the other one. One of the reasons Cameron lost his referendum was that he asked people to vote for the EU membership he’d spent the previous six years slagging off as an undemocratic fetter on the UK economy. Far from “not happening all”, the Coalition years and Cameron’s European policy were the linear precursor of Brexit. That’s not just my verdict either: Osborne has said the referendum was lost because Cameron and Co were too negative about Europe.

Boris Johnson is routinely described, in Brussels and elsewhere, as a Little England Tory brute with no regard for European history or solidarity. But that’s hardly unprecedented. Rewind to Friday, 11 December 2011, and savour the opening paragraphs of the Guardian’s lead story that morning:

David Cameron plunged Britain’s position in Europe into the greatest uncertainty in a generation as he used his veto to block a new EU-wide treaty and left at least 23 other countries to forge a pact to salvage the single currency.

With the apparent blessing of the pro-European deputy prime minister, Nick Clegg — and the subsequent delight of Tory backbenchers — Cameron deployed the ultimate weapon in European summitry at about 2.30am yesterday.

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The 'green crap' lessons of 2013

By James Kirkup

What about economics? It’s early days and the Coronavirus has obviously scrambled the compass, but there are credible signs that the Johnson administration will end up being even closer to the centre-ground of economic policy than the Coalition. Johnson won his election by junking corporate tax cuts put in train by George Osborne and promising to spend more on the NHS. “Levelling up”, meanwhile, is strongly reminiscent of the agenda pursued by the Coalition’s Vince Cable when he was Business Secretary, and often blocked by the Coalition’s higher-ups. Cameron eventually came around to a more interventionist approach to markets, adopting the Ed Miliband energy price cap he once derided. These days some Tory free marketeers (quietly) grumble that Boris’ big-state economics are not a million miles away from the “reheated Milibandism” that Theresa May tried to serve up.

Then there’s climate change. Husky-hugging Cameron and his yellow-green partner talked a good game on environmental policy, but who was it who ended up promising to “get rid of the green crap” on energy bills and effectively banning onshore wind?

By contrast, consider the environmental stance of Boris Johnson. So far, he’s upheld a legal commitment to hit net zero carbon emissions by 2050 even though most voters don’t even know what net zero means (Government polling shows only 35% recognise the term) and certainly don’t know the disruptions that hitting that target will bring to their lives. (Just google “hydrogen boiler”.) Oh, and he’s restarted onshore wind, too. So who is the populist driven by public opinion, and who is the know-all technocrat driving through policies that lack obvious public approval?

I am not denying that things have changed since 2010 — that would be foolish. But the differences between the days of the Coalition and now are easy to overplay, while their similarities are easy to overlook. We should be wary of the idea of historic rupture between then and now, not least because the changes that lie ahead for post-Covid Britain may yet make the differences between the worlds of Dave and Boris look like minor details. Sometimes, the present is more like the past than the future.

I want to talk about the models, and what they tell us, because the outputs of these models drive the government’s response — and thousands of lives could turn on them. It’s important, therefore, that we understand them, and why the numbers they give us are so different. These figures led Peter Hitchens, the Mail on Sunday columnist, to complain that the number of deaths has jumped around from 500,000 to 20,000, to 5,000. I can see why people are confused, if they just think “the models” are taking the same numbers and spitting out these weirdly different results.

But first, I want to talk about something much simpler. It’s the question that many of us, I’d say, most want to know, when we’re anxiously thinking about Covid-19 and ourselves and our loved ones. That is: if someone gets the disease, how likely are they to die?

The splendid Our World in Data (OWID) — who, full disclosure, I’ve been doing some editing for during this crisis — have been working on answering that question. So has Oxford’s equally splendid Centre for Evidence-Based Medicine (CEBM).

It is probably the most basic question you can ask about a disease, and yet it’s bloody hard to answer. It changes between places and over time, and between different groups; it depends on a variety of hard-to-measure factors, and the answer you get itself directly affects our understanding of several other numbers, all of which are vital to any model of the disease.

So. You may have heard a term being used: the “case fatality rate”, or CFR. That is the number of deaths divided by the number of confirmed cases. When journalists talk about the “death rate”, that’s often what they are referring to. If a country has 10,000 confirmed cases and 100 deaths, then the CFR in that country is (100/10,000), or 1%.

That is not what we are looking for, and it is probably not even very close to what we are looking for.

Instead what we want is the “infection fatality rate”, or IFR. That is the number of deaths divided by the number of people who actually have the disease. The number of people who have tested positive for the disease is probably only a fraction of the total number who had it, because only a fraction of the population has actually been tested. 

Obviously, the IFR is much harder to determine accurately. The only people getting tested will be the people who are most ill, so your IFR is probably much lower than your CFR, because your denominator — the number you’re dividing by — is probably much bigger. 

So if your country has tested absolutely everyone and found all cases of the disease, then your IFR is the same as your CFR, or 1%. But if it has only found 10% of the people with the disease, then your 10,000 confirmed cases are just the tip of a 100,000-person iceberg. With those 100 deaths, your IFR would be (100/100,000) or 0.1%.

Sadly, all we know is the CFR, and it changes hugely from country to country. Professor Jason Oke, a statistician at Oxford University and one of the people behind the CEBM analysis, points out that the CFR in Italy is many times higher than that in Germany; 11% of confirmed cases have died in the former, compared to 0.79% in the latter. “That can’t be down to healthcare differences,” he says: “Italy isn’t a third-world country. And it can’t be demographics — Italy has an old population [and older people are at greater risk], but Germany isn’t far behind it.” 

The likely explanation is that the difference is down to testing. Italy has largely tested people with symptoms, in hospitals; Germany has tested many thousands of people who have no symptoms. That probably helps prevent some deaths, but the most direct impact will be that it hugely increases the denominator; again, if you’re dividing your 100 deaths by 100,000 instead of 10,000, your death rate will be much smaller. Germany’s will be closer to (but not the same as) the IFR, the number we really want.

So, a country’s CFR will vary depending on how many tests it’s done, because that changes the denominator. But at least the numerator — the number being divided — is probably pretty straightforward, right? A death is a death.

Sadly, that’s not the case either. Dr Hannah Ritchie, one of the data scientists at OWID, points out that the death statistics are complex too, for two reasons. One is prosaic: a lot of people who have the disease and will die of it have not yet died. “The period from onset to death is about a month,” she says. So your simple “divide the numerator by the denominator” rule — the number of deaths by the number of patients — doesn’t work, because your number of deaths is a product of how many people had the disease a month ago, not how many people have it now.

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By Tom Chivers

That’s bad enough. But there’s a more profound problem, which is that deaths themselves can be recorded very differently in different places. Professor Sir David Spiegelhalter, a statistician at the University of Cambridge, says that the UK simply counts people who have tested positive and then died. But in some other countries, people are recorded as having died of Covid-19 if they had the symptoms, even if they weren’t tested (“suspected” as opposed to “confirmed”); in others, people outside hospitals are not tested and so are not recorded.

“Even the number of deaths is not a perfect statistic at all,” Spiegelhalter says. El Pais did an interesting look at some of the international differences here; Britain’s Office for National Statistics explains why its numbers look different from the official Government ones here.

To some extent it doesn’t matter, says Spiegelhalter: as long as each individual country maintains the same regime, ”the number of deaths is still a good monitor for the shape of the epidemic”. 

But it’s not clear that they are fixed; countries may have good reasons to change the way they collect data as circumstances change, but it apparently happens often enough that the World Health Organisation feels that they have to ask countries to notify them when they do it. Famously, China did so earlier in the epidemic, but others do too: in complying with the WHO’s request, Australia has noted that it has changed its definition of a Covid-19 “case” (and therefore a Covid-19 “death”) at least 12 times since 23 January. 

So, in essence, to work out the IFR — the number we want — we need to know two other factors: the number of people infected with Covid-19, and the number of people who died of it; the denominator, and the numerator. And, sadly, both numbers are uncertain.

How much does any of this matter? Well: now, I’m going to try and build my very own, rather stupid model. I’m not going to try to predict the future; I’m just going to try to use some very simple numbers to “predict” the number of cases there are in the UK right now.

First, the number of reported Covid-19 deaths in the UK is 1,408. Second, the lag between infection and death is about three or four weeks; let’s say three. Third, the number of (confirmed) cases in the UK has been doubling about every three to five days; let’s say five (and assume it’s staying constant; forget social isolation for now).

With those numbers, we can plug in our guess at the IFR (the infection fatality rate, remember: the real number we want to know, the “if I get it, how likely am I to die” number) and use it to work out roughly how many cases we’d expect now.

So what number should we use as our IFR? I’m going to use three: one from Imperial College London’s MRC team, the one behind the famous model; and two from CEBM. Imperial’s latest work assumes an IFR of 1%; CEBM estimates it to be between 0.1% and 0.26%.

If we take the Imperial 1%, then that means that we can multiply the 1,408 deaths now by 100 to get the number of people who’d had the disease three weeks ago, because we think about one in 100 of them died. So about 140,000 people.

Then we can take our doubling time — we said five days — to get how many cases we’d see now. In three weeks, 21 days, you’d see four doublings; two to the power four is 16. So 16 times 140,000, which is 2,240,000. We could imagine that we’ve probably got about two million cases now.

But let’s use the CEBM numbers. First the highest one, 0.26%. If we take that, we can multiply the 1,408 deaths by 400, instead of 100, to give us the number of infections three weeks ago. That is 560,000. Then we can multiply that by 16 to give us an estimate of how many there are now: about 9,000,000.

And how about if we use their lowest estimate, 0.1%? Same routine: 1,408 multiplied by 1,000, multiplied by 16: more than 20,000,000.

So by changing a single number, the IFR, to one of three plausible values, in a very simple model, we get outputs that range from “3% of people have already had it” to “30% of people have already had it”. And that’s before we start messing around with the other assumptions; is doubling time three days, not five? Is infection to death four weeks, not three? Is “1,408 deaths” even correct?

More from this author

Self-isolation is feeding my Warhammer addiction

By Tom Chivers

I want to reiterate: this is a very simple, stupid model, put together by a journalist, not an epidemiologist. The actual models will be far more complex, and will take into account other things — the number of cases in hospital and so on — to try to ground them in objective fact. Don’t mistake this for some plausible estimate of infection numbers. And there are loads of other things to worry about: people suffering long-term health consequences, even if they live; people dying of other things because the healthcare system is overwhelmed.

But the problem that I’m illustrating is real. Small, plausible adjustments to your inputs make your model spit out very different things. The assumptions you make are vital. We haven’t even started to think about other crucial things — for instance, government interventions, and how effective they are.

“The different scenarios — isolation, closing schools, quarantines — they come with massive assumptions about how adherent people are,” says Ritchie. “You get massively varying outputs, depending on what you put in.” Plus, of course, it’s all circular: your model influences how you respond; your response changes what numbers get put back into the model.

What you need is better numbers, to plug into the models. And that’s what people are trying to get. The CEBM paper uses, among other things, numbers from Iceland, which — being tiny — managed to test a huge proportion of its population, nearly 3%. It found 963 cases and just two deaths; an CFR of 0.2%, from which the CEBM extrapolates an IFR of 0.05%. But that’s likely an underestimate, because quarantining has protected the elderly, the most at-risk group. Others have done something similar with passengers on the cruise ship Diamond Princess, finding a CFR of around 1% — likely an overestimate, since the passengers tended to be older.

Another way has been to screen small groups who are in quarantine, such as the Diamond Princess passengers or passengers on aircraft, to see how many people 1) test positive and 2) show symptoms. If you know how many people have the disease but are asymptomatic, then you can extrapolate to the wider population — if you’re testing all the people who are symptomatic, and you know that 50% of infected people don’t show symptoms, and you find 20,000 cases, you can estimate that the real number is more like 40,000.

But there’s a problem here, too, which is that “asymptomatic” is not a simple thing, according to George Davey Smith, an epidemiologist at the University of Bristol. If you’re sitting in quarantine and you cough, you might be recorded as symptomatic; but out in the real world, you’re not going to take yourself to hospital for a gentle cough, so you still won’t get tested.

Instead of there being a neat “symptomatic/asymptomatic” division, you have a third group: people with some symptoms but who think it’s just a cold in the chest. (As I write, I’m coughing a little; but I don’t think that’s Covid-19, I think it’s just because I went for a run this morning and the cold irritated my lungs. But I’d probably be recorded as “symptomatic” if I were in quarantine and being screened.)

And yet another way is to look at how many people die every year, and how many people are dying now, and seeing whether more people are dying than usual. That’s how we attribute deaths to flu each year, says Spiegelhalter; the European Monitoring of Excess Mortality group (EuroMOMO) uses this data to say that in an average year in the UK, 17,000 deaths are “associated” with influenza. But so far there is no excess death at all, except in Italy: the EuroMOMO charts are all around the seasonal average. That will likely change, but we forget that in a population of millions, you’d expect thousands of deaths every day anyway: even the Covid-19 pandemic is still being lost in the noise.

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Don’t trust the psychologists on coronavirus

By Stuart Ritchie

In the end, we need testing. And not just the sort of testing we have now — PCR testing, which shows who has the virus right now; we need serological testing, which shows who has had it in the past. That will come along relatively soon, and hopefully can be quite quickly used to test randomly selected people, like an opinion poll sampling a population; then we can see how many people have had it, and from there work out the IFR. But for the moment we don’t have that. 

I wanted to write this to give an impression of how appallingly difficult the modeller’s job is. I write, sometimes, pieces about statistics — I suggested that claims about the loneliness epidemic, teen suicides, and the media’s influence on Brexit were overstated, for instance. They involved very basic maths, done for very low stakes: if I messed up, if I failed to carry a 2 or whatever, I would look very stupid and would be very embarrassed, but no one would die. 

Whereas, if the Imperial College modellers get it wrong, with their far more complex maths and their far more uncertain inputs, they could sway government policy enormously. Whether we lock down society or carry on as normal depends heavily on the outputs of models like these. And it’s not that there’s an easy “better safe than sorry” option; if we crash the economy, it will (eventually) cause real health problems.

A February 2020 review found that 10 years of austerity may have caused the growth in life expectancy to stall, especially among the poorest; I’m sceptical of the “130,000 deaths caused by austerity” stat, but it’s pretty clear that it had a real negative impact. The post-Covid-19 world will almost certainly involve huge austerity to pay for the vast costs incurred during the virus.

Get it wrong one way, and thousands of people die unnecessarily from the virus; get it wrong the other, and you crash our public services and kill people that way. (I’ve only seen one attempt to model the health outcomes of that crash, and I have no way of judging it; for what it’s worth, though, it does say they will be extremely terrible; on the other hand, recessions don’t seem to shorten life expectancy, so who knows.)

So I’m very sympathetic to the modellers. But there are things which would help, and which they can do, but haven’t, so far at least. Ferguson’s team has not released the code his model is based on; he says he is working with software developers to do so, but proponents of open science, like Davey Smith and his colleague Marcus Munafò, say this isn’t happening fast enough.

“These models are so sensitive to their assumptions,” says Munafò. “And they’re black boxes.” The code is 13 years old; it’s vital that other scientists are allowed to look at it, check it for mistakes and stress-test its assumptions. There are other, open-source models available, but the Imperial one is still kept under wraps, and it shouldn’t be.

Because a lot rides on the outputs. If millions have already been infected and the disease is less deadly than we think, then our response should be very different to if millions are still to be infected and tens or hundreds of thousands more will die. 

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Nineties Russia prepared me for coronageddon

By Daniel Kalder

The latest from Ferguson’s team suggests that between 1% and 5% of the UK’s population has already been infected. Oke of CEBM thinks that that could be an underestimate — he thinks that the disease was circulating in China for a month or so before it was announced. “There were early reports of doctors saying they were seeing unusual respiratory symptoms, which were suppressed,” he says. That could have brought it all here much earlier.

When I mentioned the Oxford “study” — in fact a model showing what plausible inputs could produce what we’ve seen, one of which was a very low IFR and huge number of people already infected — he didn’t endorse it, but said “I think a lot of people have underestimated how far this has already spread, and how early.” Davey Smith also thinks that those Imperial figures could well be an underestimate. I have no idea if they’re right or wrong, but whether they are or not matters a great deal.

For the record, to take us back to the beginning, Peter Hitchens had flatly misunderstood what was going on. The 500,000 number was a worst-case scenario if we did nothing; the 20,000 was Ferguson’s team’s estimate of what we’d see now that social-distancing measures and so on are in place.

The 5,000 wasn’t from Ferguson’s team at all but from an electrical engineering group also at Imperial who just eyeballed the death curve on the China graph, fitted the UK numbers so far onto that, and extrapolated from there. “They explicitly say they’re not doing any epidemiological modelling at all,” says Spiegelhalter, “and they retracted it two days later on Twitter,” after it became obvious that it was wrong.

But we shouldn’t be complacent and assume that, just because people are misunderstanding what the modellers are doing, the models must be correct. Everything that comes out of them is the product of what goes in, and all of that is going to be wrong, to some degree. “The key point is that the numbers we have now are not correct,” says Ritchie. 

If you look back to previous outbreaks, such as the 2009 swine flu epidemic, the numbers people were using while it was still going on were wildly different from the ones scientists settled on afterward: early estimates in 2009 were between 0.1% and 5.1%; the eventual WHO estimate was just 0.02%, similar to seasonal flu. In a fast-moving situation, it is easy to make large mistakes. (In either direction! I am not suggesting that the Covid-19 situation will necessarily be similarly overstated.)

These models are the best information we have at the moment. But they are hugely uncertain, and likely to be wrong. All we can do is try to get better information for them, and make the best decisions we can under conditions of appalling uncertainty — and be forgiving of the modellers who are desperately trying to make life-changing, history-changing decisions at high speed and with bad data. 

He showed me a Snapchat post on his phone. The missing boy’s friend had reproduced the police mugshot, but typed above it was “MAN’S GONE CUNCH!!!”, alongside a short video of the missing kid waving a wad of bank notes in a flat in Norwich.

Two months later a social media appeal for another missing north London boy, aged 14, eventually found him “doing cunch” 100 miles away on a council estate in Boston, Lincolnshire.

“Cunch” refers to “going country”, the phenomenon where gangs from Britain’s major cities, empowered by mobile phones and plentiful drug supplies, are sending young runners out into the sticks to sell crack and heroin to a sprawling provincial customer base of addicted hard drug users.

The police and media have labelled this “county lines” and County Lines is the name of a visceral new film depicting the horrors of a job thousands of inner-city teenagers are doing right now in rural towns, cities and coastal resorts across the UK. Instead of sitting in school classrooms, children as young as 11 and 12 — in the film it’s 14-year-old Tyler — are taking on a job that makes Fagin’s pickpocketing racket in Oliver Twist look rather quaint.

And this is what County Lines, written and directed by the former youth worker Henry Blake, portrays in such shocking reality, featuring a boy from a poor, broken family groomed into selling drugs in a nameless coastal town and experiencing things no one his age should ever have to.

“Going country” might appear a good option for teenagers with no money and no hope who yearn for £120 trainers, respect and all its trappings, but it’s not a role for the squeamish. If you get caught with the stash there will be little sympathy from your boss or the courts, which is why kids like Tyler have to get their stash cling-filmed, smeared in Vaseline and “plugged” up their backsides.

Where do they go to when they get to these towns or cities they’ve only heard about from the lower league football results? To add a layer of security against the police and rival gangs, county lines crews ‘cuckoo’ the homes of entrenched heroin and crack addicts, using these often dingy council flats as “trap houses” — a base from which to sell, in return for throwing tenants free scraps from their stash.

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Where the American Dream goes to die

By Ian Birrell

Days and nights are spent “on call” on burner phones dishing out deals, in stinking flats, lashing rain and in dark alleys and dog shit parks, in Britain’s bleakest corners, from faceless commuter towns to the gentrified coast, from Oxford and Cambridge to the Cotswolds. One 15-year-old county lines dealer told me about the Devon flat he worked in 300 miles away from his home in Liverpool: “There was mould up the walls. I pulled out a plant that was growing out of the fucking wall! I had to do all the cleaning myself. I had to burn weed to take the smell of crack smoke away.”

Forgotten kids serving up pockets of psychoactive escapism to a neglected army of the addicted.

Not all these teenage dealers are being coerced into selling hard drugs in the middle of nowhere. In the bigger scheme of things they are all being exploited, by those above them in the drug pyramid who are far less likely to get stabbed or jailed. But they aren’t all innocent victims forced into slavery. Some of them can’t wait to get involved, and that’s the most worrying part.

Some, bullied and abused for most of their lives, take it all out on their customers with taunts and violence. In return, they get mugged or even killed for their stash by drug users or rival gangs, or arrested and jailed, further entrapped by a drug supply rap and the criminal fraternity of the convicted.

The money is better than McDonald’s, but the future is not as peachy as the underground music videos make out.

“I did have empathy for these boys: they were kids, but they never talked about normal teenage things,” a sex worker who allowed a London gang to sell drugs from her home in Southend recently told me. “They were mentally drained. They used to lie on my settee and sleep with the phone by their head, working 22 hours a day. A couple of times they would have a treat, like buying a new pair of trainers. They were putting on an act, trying to pretend they were the big boys, but they were young kids.”

Some of them, usually the clever ones with an eye for business and an adeptness for second-guessing others, will avoid the bear traps and slowly rise to the top, finally being able to afford the BMW, the diamonds, the girls and the glances they always dreamed of. Others — maybe helped by a parent or youth worker — will escape. But most end up on the scrap heap, even further locked out of the mainstream economy than they were at the start.

Crucially for those outside the drug game, the county lines phenomenon does not just impact young urban drug sellers. It is transforming the parts of Britain where they have set up shop.

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Don't call it poverty porn

By Jenny McCartney

Sleepy provincial drug scenes have been injected with fresh, cheap, reliable supplies, which means more petty crime to find the money for drugs, more addiction and more fatal overdoses. Across the country, local train stations, housing estates, church graveyards and high streets have seen a rising presence of city drug gangs and open air drug markets. Local police forces, who previously might have had to deal with doped up “user-dealers”, have had to direct already sparse resources to fighting a new, well-oiled, professionalised threat and a conveyor belt of recruits arriving from the big cities.

As well as cuckooing homes, city gangs protect themselves by employing the natives to do their dirty work — whether it is local teenagers to help sell drugs or addicted customers to rent out dealing cars and drive them from spot to spot. It’s the franchise that cannot stop expanding.

County lines is now a media buzz phrase. To the newspapers, every person convicted of drug dealing, even if it’s some old coot selling weed out of his back window, is now a ‘county lines’ dealer. Yet while the phrase has become some kind of clickbait, very little is known about why, in one of the richest countries in the world, selling crack and heroin miles away from home has become a regular job for thousands of teenagers who should be in school learning about osmosis and Martin Luther King.

If you believed senior criminal justice officials, MPs and the mainstream media, the finger of blame points squarely at two culprits: evil drug barons and middle-class coke-snorters, especially those who have dinner parties, drink fair trade coffee and are vegan. One entraps and exploits the workers, the other enables the trade with their thoughtless, hypocritical indulgence.

But blame is often deflection. This stuff about cocaine snorters — of whom most these days are working class, but politicians don’t like telling off builders — fuelling county lines profits sounds intuitive. Yet it’s bollocks, because the powder cocaine and county lines markets are not connected. Even if every British person stopped snorting cocaine, the crack cocaine and heroin market — which accounts for half the sales of the entire UK drugs market — would carry on regardless. Cocaine-snorters are not harming young British drug runners, but in a world where prohibition hands the drug trade into the hands of organised crime, they are partly responsible for the drugs war bloodshed in Latin America.

In terms of the evil drug bosses, of course, there are some nasty people involved in the highly-profitable crack and heroin business. As Top Boy and The Wire did before, County Lines does a good job of portraying their cold cruelty and the ultimate expendability — or “acceptable loss” as the film calls it — of the young drug trade recruits who are jailed or killed. That being said, Britain’s drug trade is not as deadly as the authorities make it out to be. The number of homicides caused by actual drug turf wars in the UK is proportionally tiny compared with the highly lethal nature of America’s business.

What really lies at the root of the county lines phenomenon is why British children are so desperate to do this job. Luckily, the ‘why’ is something that those who’ve actually done this job have been happy to relay to me. And it does nor reflect the simplistic, black-and-white world being painted by the authorities.

County lines teenagers I’ve spoken to don’t mention evil drug bosses or middle-class coke buyers; instead they talk about two competing drives: the desire to be someone and the shutting down of that opportunity.

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The town that should shame our politicians

By Paul Embery

Never has there been a time when everything you can’t have is incessantly shoved in front of your face 24/7. The poorer you are, the more potent this is; it’s 1980s rampant consumerism projected 100-fold through a social media prism. It’s all about quick fixes, appearance, power and money. If you don’t have it, you need it.

Though there are exceptions, which the media loves to go on about, most of the children working county lines come from impoverished backgrounds, from communities set adrift by a thousand austerity cuts. These kids might be unloved but they are not stupid: selling drugs offers a way out of the trap, an escape from a bad education, racism, claustrophobic living and hopelessness.

In her excellent report into drugs and violence published last month, Dame Carol Black rightly turned the spotlight on the Government for the rise of county lines. “There are strong associations between young people being drawn into county lines and increases in child poverty,” she wrote: “the numbers of children in care and school exclusions… against a backdrop of falling local government budgets…and cuts to young people’s services.”

County lines, whose origins I traced back to a line running from Brixton to Brighton in 1999, is the latest successful business model in the ever-entrepreneurial drug trade. But its currency is the social conditions created by successive governments, which have not only delivered a customer base of 300,000 addicted heroin and crack users, but a willing workforce of children who serve them up, who reason that the best way they can get ahead in life is to risk their life selling drugs to a queue of lost Gen Xers out of a shithole flat in the middle of nowhere.

I’m hoping that the overriding message people take home from County Lines is not about how profit obsessed and exploitative the drug gang leaders are, because this is no surprise, but how profit-obsessed and exploitative governments have led us to this unique situation. Charles Dickens would be gutted. Because County Lines is a reflection of a fucked-up country, a manifestation of widespread neglect that Britain thought it could get away with, except it’s come back to bite back us where it hurts most, in Middle England’s own back yard.

Many of the stories that dominated the news agenda early that year, though, seem quaint in retrospect. The then-chancellor Alistair Darling cut stamp duty for first-time buyers and increased taxes for the better off. The Prime Minister, Gordon Brown, was recorded disparaging a member of the public who ranted to him about Eastern Europeans “flocking” to Britain as a “bigoted woman”. Volcanic ash closed British airspace for a few days.

At May’s general election there was a change of government after 13 years; yet it hardly seemed a seismic event at the time. A tired Labour administration was replaced by a coalition government headed by two slick television performers who promised a “new politics” in which “compromise, give and take, reasonable, civilised, grown-up behaviour is not a sign of weakness but of strength”. Asked what he thought of new Prime Minister David Cameron, the late polemicist Christopher Hitchens replied: “He doesn’t make me think.” This summed up the mood of many, who felt that Cameron was, as Hitchens put it, “content free”.

Indeed, many were fooled by Cameron’s — and to a lesser extent Clegg’s — presentation as leaders of a moderate liberal reforming government, including many former Labour voters, who failed to anticipate just how radical the coalition would be. Cameron was a “new kind of Conservative” alright, but largely in the sense that his conservatism was inextricably wedded to a flavour of economic liberalism which had very little to do with traditional conservatism at all.

By September 2010 the chancellor, George Osborne, was ready to “wield the axe”, as the BBC put it at the time. Funding for the police was to be cut by 20% over four years, the budget for new social housing reduced by 60% over the same period and the justice department faced cuts of 6%, with 3,000 fewer prison places.

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What's David Cameron hiding?

By James Hanning

Significant in terms of what would transpire during the Brexit referendum was the unprecedented rolling-back of the public realm. The austerity programme introduced by the Coalition government was made up of 89% spending cuts and 11% net tax rises. In the end the Coalition reduced public spending as a proportion of GDP by as much in five years as Margaret Thatcher managed in 11.

The impact in many parts of Britain was severe. There were a million requests for emergency food aid in the last year of the Coalition Government. Morbid online jokes about deceased individuals being declared “fit for work” by the Department of Work and Pensions functioned as a coping mechanism for a society in which people really did drop dead after being declared fit for work. The DWP was run at the time by the severe figure of Iain Duncan Smith, who might as well have been lifted straight from the bureaucratic apparatus of one of Charles Dickens’ workhouses or boarding schools.

Of course, austerity didn’t cause Brexit. But it did contribute to the disillusionment many felt with the Westminster establishment — disillusionment based on feelings of abandonment by the powers that be. In working-class towns such as Blackpool, Rugeley and Ebbw Vale — towns I spent time in in 2016 during my six-month trip around the country to research my book Hired — Brussels functioned as a lightning rod for the disillusionment caused by economic decline and deindustrialisation.

All around there were reasons to want to ‘take back control’, as the anti-EU slogan had urged people to do. “Look at this country and look at how it was thriving in the Fifties, Sixties, even up to the Seventies, but since we joined the EU it’s just gone down,” a former miner at the shuttered Bryn Colliery in Port Talbot told me.

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Imagine David Cameron had won his referendum

By Peter Franklin

Austerity made life harder still, reducing peoples’ benefits at a time when zero-hours contacts and insecure work required a comprehensive social safety net rather than one deliberately riddled with holes. Homelessness was so bad in some of the places I visited that it felt as if there were a person under a pile of corrugated cardboard in nearly every shop and restaurant doorway. A study from Sheffield Hallam University from published in 2015, shortly before I embarked on my journey, found that 21% of people who had their benefits sanctioned became homeless as a result.

There was much speculation following the referendum as to the cause of the result. London journalists were sent off to explore working-class communities that were said to have been ‘left behind’ by capitalism — and which had consequently rebelled against the status quo as represented by Brussels. Other liberal commentators damned their fellow countrymen as spluttering racists and unreconstructed bigots. The EU — for these intolerant champions of tolerance at least — was synonymous with contemporary bohemian affluence: the free movement of cheap labour and capital, free trade, rule by avocado-eating technocrats etc.

Few of them expected the referendum vote to favour Brexit at any rate. Moreover, the palpable shock of that summer morning in 2016 led many to lose their intellectual footing. Newspaper columns were filled with histrionic pronouncements of ‘creeping fascism’ and impending economic collapse; 2016 was dubbed liberal democracy’s annus horribilis.

Had Gordon Brown scraped through in 2010 a Labour government would undoubtedly have made cuts. But they would have been nowhere near as deep as Osborne’s. This takes on some significance when we are talking about a narrow vote to Leave in the referendum of 2016, a referendum that Labour would never have called in the first place. To say that these two decisions have reverberated across the decades since is an understatement.

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Where would the Left be without Brexit?

By James Bloodworth

The Labour administration that was thrown out in 2010 was certainly exhausted after 13 years in power. It was assailed on all sides by a corporate media which, apart from the Daily Mirror and, curiously, the Daily Mail, had never taken to Gordon Brown, whom it unceasingly mocked as gaffe prone and ‘dour’. By contrast, Cameron and Clegg were politicians well-suited to the television and social media age. Their vacuous soundbites, sharply pressed suits and phosphorescent smiles captured the mood of a country that was tired of Brown’s bureaucratic profligacy and had grown suspicious that the undeserving were taking advantage. As the British Social Attitudes survey reports, “The level of agreement with spending more on welfare benefits for the poor fell from 61% in 1989 to 27% in 2009.”

And so the British public voted for a PR man to be their Prime Minister. Eventually it would become apparent that Cameron’s peculiar self-confidence came not from any exceptional political skill but from a sense of entitlement drummed into him by a traditional upper-class upbringing. But not before the fateful decision had been made to vote him in a second time, this time with a majority. Incredulity ensues among the young when I tell them that Cameron was once considered a safe pair of hands by the British establishment. Looking back through the archives, I am pleased to report that in 2015 I described this widespread misconception as a “façade”.

The British establishment of the late 20th and early 21st century resembles a curiously incestuous beast. Cameron got his first job in politics because Lord Lexden, who was deputy director of the Conservative Research Department at the time, received an anonymous telephone call from Buckingham Palace tipping him off about “an outstanding young man”.

Britain has been paying the price for this lack of judgment by the palace (Was it Prince Andrew who made the call perhaps?) ever since. But then who are we to judge when, as a country, we voted Cameron into office — not once but twice?

The trouble started before Cameron of course. There was a colossal loss of public trust in politicians over the Iraq war, the MP’s expenses scandal and the global financial crisis. But it was the decision to elect Cameron in 2010 — a politician whose measure President Barack Obama had two years earlier when he reportedly described him as ‘lightweight’ — which set us on the path to where we are today. BC — Before Cameron — the situation was recoverable. After, not so much.

The 2016 Brexit vote has focused minds on the recalibration of our social politics, but the leftward economic shift of the Establishment, who are in some ways following the public, is less commented on. Indeed, while the Brexit vote explained the Conservatives’ rise in the Midlands and the North in the 2017 General Election, it was the popularity of Corbynomics which propelled Labour to near parity with the Conservatives two years ago – a spectre which haunts this election.

The figure of Corbyn obscures the fact that Labour’s economic statism and red-in-claw socialism is popular and has been for some time. A recent YouGov poll indicates that the unpopular Labour leader, with the worst opposition leader ratings of all time, has a manifesto whose contents, when polled, have majority support across the board.

Survey after survey, and vox pop and after vox pop indicates that the British public are tired of austerity, tired of a battered and shabby public realm and now fully support better funding for public services, and more investment — even if this means higher taxes. The 2019 party manifestos reflect this new normal, with the Tories committed only to modest spending and tax rises, with Labour committed to shifting the country’s economics to the far Left.

UnHerd has commissioned polling which indicates that only 30% of the public agree that “Tax rates for high earners should be minimised to keep the UK competitive”, with 42% actively disagreeing with this statement. In terms of electoral geography, FocalData has estimated that only 22 of Britain’s 632 parliamentary constituencies have more people than not committed to tax competitiveness. Indeed those high spending manifestos are a reflection of these sentiments.

Of the 22 seats that support minimising tax on high earners, 17 are in London – including, somewhat ironically, the constituencies of Jeremy Corbyn and Emily Thornberry; yet another issue on which the capital finds itself out of step with the rest of the country. In fact, it’s easy to assess how likely an area is to support minimising the tax burden on the richest simply looking at how high house prices and average wages are in a constituency.

Just as interesting, though, is people’s perception vs reality on where the tax burden in this country really lies. The Government’s own data suggests that the Top 1% pay a staggering 30% of all tax, while taking only 13% of income. Tax change after tax change has shrunk the tax base, and while the many may want the few to pay a bit more, what happens if the 1% decide, in a world of global capital and free movement, that they don’t fancy paying for 1/3 of all Britain’s public services. We may be about to find out…

Source: HMRC

I had just moved house — which is a pretty poor excuse. Particularly since I’m a journalist, and so should be on top of most of the goings on in British politics. I suppose what I’m trying to say is: it’s easily done!

Many of these democracy-loving activists go further than Izzard, though, and equate the act of voting itself with civic virtue. When they demand that we “use our vote” next week, they are, in fact, asking us to line up faithfully behind a particular party. And they imply that anyone who chooses not to “use” their vote is somehow abdicating their civic duties — and insulting those who died for universal suffrage.

To all young people – please do register to vote by end of tomorrow (26th) and use your vote on 12th December. Don’t let the older generations decide your future. Have your say about the future of our country, our continent, and our world https://t.co/5au3gPGi8j

— Eddie Izzard (@eddieizzard) November 25, 2019

Frankly I’m getting a bit tired of it. In fact, I might not vote at all. Not because I’m lazy or apathetic, but because each of the three main parties is so woefully inadequate when it comes to meeting the challenges facing modern Britain. It shames the whole democratic process that the system has propelled such a broad sweep of mediocrity to the frontline of politics. The thought of voting for any of them fills me with disgust.

Sure, I understand that people died for my right to vote. But what many don’t seem to grasp is that the right not to vote is part and parcel of the democratic system those brave people fought for. Indeed, as anyone living in a country where people are bused to polling stations (with the threat of losing their liberty if they do not comply) to vote for a single candidate will tell you, not voting can itself be a revolutionary act.

But many of my friends, who are equally repulsed by the politicians offered up by our political system, are slowly being guilt-tripped into falling into line as the general election draws near. They now tell me — scold me, in fact — that I should vote for the “lesser evil”. This would, presumably, result in less evil, which is no bad thing. But what happens if I look at several very different evils and am unable to decide which is worse?

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Liberal smugness will destroy the Left

By Giles Fraser

Until this year, I was a member of the Labour Party. I had been for 15 years. It wasn’t one single incident which led me to leave, but rather the darkening penumbra of conspiratorial anti-Semitism which seemed to emanate from much of the newly enthused party membership. I didn’t want to be around it. I didn’t want to be infected by it. And so I left.

When I look at Jeremy Corbyn, a person his fanatical supporters like to call a “man of principle”, all I see is a hypocrite. He is against “all forms of racism” except the form of racism most commonly deployed by the Left. He is for human rights, except for in those countries where nominally Left-wing governments hold power. He is against war and imperialism, yet can barely bring himself to condemn the Russian bombing of civilians in Syria. Hypocrites of this stripe are ten a penny in his party and they do not enthuse me one bit.

One of the most dispiriting things about Labour’s anti-Semitism scandal is the speed at which nearly all the party’s MPs, many of whom were previously critical of the leader, have lined up faithfully behind Jeremy Corbyn now that an election is upon us. Purported anti-racists are currently campaigning to put the man responsible for the return of anti-Semitism to mainstream politics into No 10. Their ‘principles’ turned out to be entirely dependent on electoral expediency. This is the very definition of virtue signalling. Clinging to a cushy job in parliament takes precedence over the fears of Britain’s Jews.

The Tories, meanwhile, have their own problems with anti-Muslim bigotry; and Boris Johnson is a self-serving chancer. Besides, temperamentally, I am not a conservative. I wrote about the consequences of Conservative-imposed austerity at length in my book Hired. I saw some shocking things during the research for that book (which you can read about on UnHerd) and have no intention of voting for a party which helped to foster the dark world of squalor, precarity and quiet desperation that exists behind the façade of bourgeois affluence.

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That leaves the Liberal Democrats. Liberal Democrat leader Jo Swinson is far less objectionable than Jeremy Corbyn or Boris Johnson — even if she is a charisma-free zone. However, in terms of austerity, her party is almost as culpable for the mess the country is in as the Conservatives. Moreover, the party’s stance on Brexit, in which it would effectively overturn the result of the 2016 referendum, is profoundly undemocratic and would result in a further erosion of trust in democracy.

I think I’ll pass on all of them.

Many won’t of course, even though they share my concerns. Their blind-loyalty is such that they will put their misgivings aside and dutifully turn out to vote. As an old aphorism goes, you could pin a red/blue/yellow rosette on a dog in certain parts of the country and many would still place a cross by its name. It’s why around half the parliamentary seats in the UK are safe seats: places where thousands of people vote reliably and consistently at any given opportunity.

I resent this dull-headed tribalism. It’s one of the reasons I became a journalist instead of going into politics, which I briefly considered once upon a time. I’ve no interest in standing on a stump and trotting out my party’s ‘line’, if it means acquiescing in institutional anti-Semitism. And perhaps most important, I’ve no interest in lying to myself in order to preserve some ideological house of cards. Why bother? Any gains a Labour government might bring to the poorest in society will eventually be poisoned by the maggot eating away at its rotten core. It’ll take the party down with it. We must not allow it to infect wider society.

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Unfortunately, it is the tribalists of both sides who are on the march at present. Is this is a consequence of social media? Or are the fanatics are filling the spaces vacated by religion. Either way, a lot of people seem desperately to want something and someone to believe in. Intolerance is a by-product of this rigid in and out group dichotomy. Anti-Semitism and racism apparently acceptable prices to pay.

When the day of the vote arrives, I will probably spoil my ballot paper. I hope that others will do the same, a collective protest of sorts. I hope many more will stay at home. I don’t want the anti-Semites, the anti-Muslim bigots and the conspiracy theorists to turn out next Thursday. I would also prefer it if the unthinking, the blindly loyal and the bullied into it stayed home too — even if such sentiments are out of step with the ubiquitous online exhortations from do-gooders to “use your vote”. Though I recognise this is probably a forlorn hope in the current climate, when each day seems to reaffirm Yeats’s line about the worst being “full of passionate intensity”.

It had tried to shield the old and poor from the worst of it, but at the cost of taxing the middle class, the rich, and the country’s vital tourist trade. It met the targets of the European Central Bank, privatised the ports and airports, played an exemplary game in international politics, and spent more of its GDP on Nato commitments than any other member.

In the end, many of its supporters stayed at home, while the far-right vote switched back to the conservatives, and Syriza lost power – scoring 31.5%, compared with 40% for the centre-right New Democracy party.

For the some on the far Left, the fall of Syriza government is the termination of an embarrassment. Alexis Tsipras led the party to power in 2015 on a promise to resist austerity but after a few nail-biting months was forced into abject retreat, with the country’s banks closed, chaos on the streets and vital services only a few days away from failure.

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For me, however, there are positives to take away that have implications for the entire project of the global Left. First, Tsipras showed that with a clear narrative, a message of hope and some competent advisers, the far-Left’s project can work in government. The oligarchy, whose two-party system (Pasok and New Democracy) collapsed, expected Syriza to be amateurs: in fact they brought professionalism and openness to an endemically corrupt and chaotic state.

Second, by being radical in opposition, and refusing to give up radicalism even when forced into retreat, Syriza and the wider Greek Left defeated one of the most violent and open fascist threats in the European continent. Its conservative predecessors had tolerated Golden Dawn’s infiltration of the police, and murderous violence on the streets. Without a Left prepared to risk taking power, Greece would have degenerated into a battleground of populisms.

Third, Syriza supplanted the traditional Greek social democratic party Pasok as the “natural” party of Left government. Its spokespeople, pundits and aligned senior journalists now inhabit the Greek airwaves and cultural life.

Finally, the shock of seeing the Left in power has changed – for now – the behaviour of the Greek conservatives. They were forced to exchange ageing playboys and oligarchs for politicians who look cleaner and more restrained.

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How Europe smothered the radical Left

By Peter Franklin

On the downside, the experience of the 2015 “Greek Spring” proved beyond doubt that, within the Eurozone, the political space for a radical Left government will always be constrained. You can defy the Maastricht rules on public finance – as Italy’s Matteo Salvini is doing now – but if you do so in combination with a radical shift of power and wealth towards the people, the coercive force of the central bank will be used against you.

To understand where the radical Left goes next, you have to understand how modest its achievements have been outside Greece, and how its enemy has changed.

In Spain, the advance of Podemos-Unidos, an alliance of traditional communists with the new “horizontal” activist movement that sprung up in 2011, has stalled. After scoring 14% in April’s general election, its leader Pablo Iglesias is now forced to be a junior and inconsequential coalition partner in the socialist-led government. The same rough arrangement applies to the Left Bloc in Portugal – currently polling 9%. In Denmark, another electoral pact between the far-Left and social democrats has put the latter in power.

In Finland, a general shift to the Left has put the radical Left Alliance into a broad governing coalition with Greens, Social Democrats and Liberals. Germany’s Left Party, born out of the former ruling communist party, survives on around 9%, and plays a leading role in the “Red-Red-Green” government of the Berlin region.

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The heat is on for Greece

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In general, overtly anti-capitalist Left parties have peaked below 20% as the memory of the financial crisis fades, while a shift to the Left by traditional social democrats has stemmed their own decline.

But the political forces emerging out of the 20^thcentury Left face two new challenges: the so-called Green Wave, which has swelled the electoral support of Green parties everywhere; and a growing electoral threat from far right or overtly racist parties, some of which are building support among the working class communities where the Left used to be strong.

Syriza, Podemos and the rest prospered after 2008 because their politics, and to an extent their style, resonated with the mood of anger as deep austerity followed the bailout of the banks. Faced with a crisis of consent for democracy, the rule of law and human rights, the whole Left – including both Marxists and social democrats – is being forced to make choices it wanted to avoid.

The first hard choice is between redistribution and saving the planet. Orthodox Left doctrine tells you this does not have to be a choice, and that the challenge of rapid decarbonisaton should be an opportunity for the Left to sell – indeed to converge around – its well-worn projects of state direction and intervention. But to capture the imagination of the young people involved in the US Sunrise Movement, or Fridays for Future in Europe and Extinction Rebellion here, the order of precedence has to be clear.

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Who broke the Left?

By Giles Fraser

In future, Left-wing parties will need to look and sound like they care about the planet more than anything else – and the truth is, our tradition has not always done so. The closer you remain to the traditional working class communities which prospered during the carbon era, the harder it is to walk the walk when it comes to zero carbon.

When it comes to the far-right threat, the Left should be on firmer territory. The very prestige of parties such as Podemos, Syriza and Die Linke rests on the leading role their communist predecessors played in the struggle against fascism in the 1930s. But today’s far Left is reluctant to make the big tactical change their grandparents’ generation made when faced with Hitler and Franco.

In the 1930s, faced with the rise of fascism, Stalin ordered Western communist parties to form “Popular Front” coalitions with liberal and conservative parties. By 1936, those governments controlled both France and Spain. You could even argue that the spirit of the Popular Front animated Attlee’s decision to join Churchill’s wartime coalition in May 1940.

But leaders like Pablo Iglesias in Spain, or Jean-Luc Mélenchon in France, have invested so much personal energy in fighting the liberal centrist parties that they cannot bring themselves to make the same kind of overt, strategic change of priorities. And there is no Stalin to bang their heads together.

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The permanent punishment of the Greek people

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As a result the strategic hopes of the global Left now lie with two veteran leaders who have chosen their own long march through the institutions: Jeremy Corbyn here and Bernie Sanders in the USA. Whereas Syriza had to destroy Greek social democracy in order to replace it, Corbyn and Sanders chose to take over their respective centre-Left parties.

But Corbyn and Sanders face effectively the same dilemma as the rest. To enact a radical programme they need power; to gain power they need a story of hope to energise the poor, competence enough to mobilise middle class voters and – for the youth – to look and sound like climate change is their number one priority. Like Tsipras, they need to jettison the most extreme “anti-imperialist” obsessions of some of their activists.

And as Tsipras discovered, doing all that only gets you into office. Once there, you have to take on the real power: the financial markets, hedge funds, oligarchs and organised criminals who believe they can make and destroy governments at whim.

The sheer scale of the climate crisis will, as the 20^th century recedes and the IPCC’s decarbonisation targets become pressing, change the priorities of the Left. The far-Left is now either in reluctant coalition with its social democrat and Green allies, or resisting even that. For me, the 21^stcentury equivalent of the Popular Front would be an alliance of all forces prepared to commit to spending the hundreds of billions we’ll need to combat climate change, plus the absolute defence of democracy and the rule of law, plus the reversal of austerity. The renationalisation of energy and transport infrastructure is implicit in any radical plan to halve net carbon over the next ten years.

Paradoxically, the most tactically adept Left politician on the planet remains Tsipras, though he is despised by Mélenchon and publicly avoided by Corbyn. Tsipras just survived a four-year crash course in the language of priorities and came out with 31.5% of the vote (with a further 8% actually going to parties to the Left of him). Above all he made a government of the far-Left thinkable, in one of the most polarised democracies in Europe. That’s what I think the minister meant by “losing nicely”.