Why Labour Can’t Fix the UKs Polycrisis
Photograph Source: Kirsty O’Connor / No 10 Downing Street – OGL 3
The UK’s decrepit first-past-the-post electoral system virtually guarantees a two-party grip on parliamentary power. Since WW2 the two parties in question have been the Conservatives and Labour, with the Conservatives enjoying 3 long spells in power,1950-64, 1979-1997, and 2010-2024, countered only by Labour’s Blair/Brown ascendency in 1997-2010.
Labour’s single term in power from 1945-1950, however, saw the momentous creation of the UK’s welfare state, which started to erode as a policy choice when Margaret Thatcher became prime minister in 1979– a phase that was also coterminous with the onset of the neoliberalism of which she was a devotee.
The UK has been in a long-term polycrisis: a chronically weak economy since the 1970s; increased inequality while the crippling outcomes of Tory austerity and Brexit remain overlooked and unaddressed; lip-service in dealing with climate breakdown; catastrophic underfunding of the NHS; a corrupt and chumocratic Establishment (massive Tory Covid contracts handed out without oversight to cronies and pals; as well as Starmer’s Freebiegate, where he and several ministerial colleagues accepted significant donations for vacations and clothing); crumbling schools and teacher shortages; systemic racial injustice; police and prisons at barely-functioning levels; lies and distortion ingrained by a media largely owned by rightwing billionaires domiciled overseas; and an imperial-level Ruritanian monarchy, replete with gold carriages and multiple palaces and castles, all glaringly at odds with Ukania’s post-imperial decline; and so forth.
Since it came to power in July 2024 Starmer’s Labour has lurched from one misstep to another.
Two ministers, unsurprisingly from the party’s right wing, who should never have been appointed by Starmer, have been forced to resign.
Louise Haigh was transport minister until she quit this position when it emerged that she was made a minister by Starmer despite having a criminal conviction Haigh said she had revealed to him before he appointed her. In 2014, the year before she entered parliament, Haigh had pleaded guilty to fraud by false representation when she reported to police that her work phone had been stolen while it was still in her possession. Allegedly she thought her insurance would pay for an upgraded replacement phone.
Tulip Siddiq, the niece of Bangladesh’s deposed despot Sheikh Hasina, resigned as Labour’s anti-corruption minister after she was named in 2 corruption probes linked to a plot of land her family received from Hasina’s government.
Starmer had pledged repeatedly that Labour would restore trust in government after 14 years of Conservative sleaze and corruption, and his swift reneging on this undertaking has propelled Labour downwards in the opinion polls.
Labour’s first few months in office have been a catalogue of missteps, exposing a lot more than a taste for gorging at troughs filled with the finer things of life.
An inheritance tax that had hitherto excluded farms will now include them, and is projected to raise £520m/$632m annually, a relatively small amount in the bigger economic scheme of things. This will have a severe impact on hard-pressed rural families, even as continuing unclosed tax loopholes allow the super-wealthy to multiply their riches.
The much-criticized chancellor of the exchequer/finance minister, Rachel Reeves (who delights in the sobriquet “the iron chancellor”), abandoned the policy of granting all pensioners a fuel payment every winter—under her new rules, only those in receipt of a pension credit will be eligible for the winter fuel payment. Many pensioners, who have contributed to the exchequer for decades during their working lives, now face a possibly crippling financial burden, as they have to choose invidiously between having enough to eat or not dying from hypothermia.
Labour also refused to repeal the Tory policy that limited the child tax credit to 2 children, thereby acknowledging implicitly that only the relatively well-off are “entitled” to have more than a couple of offspring, which looks suspiciously like eugenics through the back door.
These and other policy decisions are not the products of a cast-iron necessity, but are political choices pure and simple. Labour pledged repeatedly to address the needs of the less well-off who suffered from 14 years of Tory austerity and misrule, but has done little of this so far.
The latest Labour stumble is its panicked response to a 10-day turbulence in the UK bond market which raised the price of government borrowing. Historically bond markets worldwide have tracked their US counterpart, and this is exactly what happened here—if the US is up, other bond markets go up, and if the US is down other markets follow suit. A potential cause for real concern occurs when there is more to bond market turbulence than the mirroring of US price patterns.
Reeves and Starmer should have said they would be vigilant with regard to this market instability while not adopting any hasty measures as a response. Instead, they’ve promised a March mini-budget with spending cuts targetted primarily at the civil service and sickness benefits.
To deal with the UK’s sagging economy, Reeves offers a “plan for growth” with 2 pillars: a focus on private-public partnerships in dealing with the NHS crisis and climate breakdown, as well as investment in AI. Reeves has probably not read Brett Christophers, The Price is Wrong: Why Capitalism Won’t Save the Planet, who argues that transitioning to renewable energy is simply not sufficiently profitable for the private sector for it to have a significant enough impact on this transition.
Likewise AI will almost certainly be a key part of the “state capture” projects that are already being mounted by the rightwing Silicon Valley tech billionaires Musk, Bezos, and Zuckerberg. Notions of the common good play no part in these rightwing projects. AI will likely result in a considerable restructuring of labour markets, and the tech billionaires are no friends of organized labour. The faith placed by Starmer and Reeves in AI will certainly be tested if the just-mentioned scenarios materialize.
For now it is difficult to give much credence to the thought that managerialist technocrats like Starmer and Reeves have the wherewithal and strategic vision to deal with the UK’s polycrisis.
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