Kicking The Can

Ben Wildsmith

In characteristically belligerent interviews following the announcement of her budget, Rachel Reeves predicted that she would be in her job until the next election, making decisions to grow the UK economy.

This would have come as a surprise to the Office for Budgetary Responsibility, which announced that the budget would have no effect, positive or negative, on forecasts for growth. Nada. Zilch.

The markets seem, for the moment, to have reacted to the budget with a shrug. For all Reeves’ blustering tone, her decisions are remarkable only in their inconsistency to the spirit of previous pledges not to increase the tax burden on working people.

Caught between potentially mutinous backbenchers and Truss-slaying bond markets, Reeves has played it safe and kicked the can down the road once again. She gives the impression that if she’s still in a job after Christmas and bond yields haven’t risen to threaten bankruptcy, then that’s good enough for her.

Is it good enough for us, though? If you are neither a Labour backbencher, nor an international financier, do you feel reassured that things are on the up here in the UK? The OBR reports that people are beginning to save money that they might be expected either to spend or invest. People are unwilling to take risks because life feels so precarious. If the government is relying on growth to fund future ambitions, then a lack of consumer confidence is an urgent problem.

In the wider world this week, extraordinary changes were either happening or being suggested. On budget day itself, Hewlett Packard announced it was cutting 6000 jobs as it turned to AI to speed up product development.

I am struggling to think of a UK politician who is engaging with this issue at all, beyond the Prime Minister’s gleeful embrace of data centres as a source of fast cash. Here, we are told, is where the mythical growth will come from. Environment-taxing, football pitch-sized banks of servers will power the UK back to competitiveness as they boost efficiency and slash costs in all sectors.

That’s great until you realise that the cost being slashed is you. Do you remember when all schoolchildren needed to learn to code?

Yeah, sorry about that, kids, your AI replacement doesn’t suffer from anxiety, take time off to have children, or answer back.

The government hasn’t forgotten our young people, though. As negotiations to end the war in Ukraine continued, the Prime Minister was once again insisting that British troops be deployed to police the ceasefire.

Ukraine 

Support for Ukraine is widespread in UK society, but I don’t think I’m alone in wondering why our government is so conspicuously at the front of the queue to offer our money and soldiers to the cause. If our young people need to be deployed in the service of peace, so be it, but Starmer’s eagerness seems out of place when no deal has yet been reached.

Like the open-ended £3 billion per year he authorised to Ukraine, and the 100-year partnership he signed with the country, it seems to expose UK interests and personnel without any guarantee that we can meaningfully influence events.

The budget rearranged matters to the mild irritation of some and the limp approval of others. Around it, we were further conditioned for war with Russia, whilst the prospect of AI decoupling economic growth from human prosperity altogether went unaddressed.

Critiqued

On Andrew Marr’s radio programme, a government spokesman defended the budget before it was critiqued by the opposition. The opposition, for Marr, meant the Conservatives and the Liberal Democrats.

Despite Reform UK and the Greens clearly outperforming the old guard in the polls, it was business as usual. Politics seems to trundle along in a bubble of self-congratulation whilst unprecedented storm clouds gather above us.

As we squirrel away whatever we have, feeling the peril of the moment, our politicians lack the imagination to face reality at all.