The Pivot of History

According to Branko Milanovic, "January 20, 2025 marks a symbolic end to global neoliberalism. Both of its components are gone. Globalism had now been converted into nationalism, neoliberalism has been made to apply to the economic sphere only. Its social parts—racial and gender equality, free movement of labor, multiculturalism—are dead. Only low tax rates, deregulation and worship of profit remain." There is no shortage of symbolism in Donald Trump's second inauguration, but I think the idea that his return to power marks the definitive end of global neoliberalism is too neat. The stark opposition that Milanovic proposes between globalism and nationalism makes little sense, neoliberalism continues to dictate social policy in such areas as welfare, and the claim that multiculturalism is dead is no different to rightwing commentators claiming that it has "failed". Pivotal moments are often little more than narrative conveniences. Just as neoliberalism started to influence government policy long before Margaret Thatcher entered 10 Downing Street in 1979, so its end will be a long, drawn-out affair. 

The roots of neoliberalism lie in the counter-movement against democracy that began after the First World War. The idea that politics should conform to market principles was a later ideological addition to the premise that democratic control over the economy would spell the end of private property. It was the exigencies of war that first opened the appalling vista of state control and led both to working class radicalism in the postwar years and the emergence of what Clara E Mattei in her book The Capital Order described as a "reconstructionist" agenda among progressives who saw state intervention as the means to advance social justice. The centre-piece of the counter-movement was the invention of austerity: an explicit programme to constrain the state by imposing costs on the democratic majority through reductions in welfare, wage repression and the fiscal discipline of government by debt-holders. These features have been as consistent throughout the history of neoliberalism as low tax rates, deregulation and the worship of profit. 

The simultaneous emergence of Fascism in Italy in the 1920s was not simply another expression of the anti-democratic movement. It showed that neoliberalism's political agenda was wholly compatible with an activist state. Fascist governments employed the same techniques of austerity but justified them through appeals to nationalism, racism and anti-Bolshevism. Private property was sacrosanct and state industries were privatised (the ideological equation of Nazi and Soviet totalitarianism during the Cold War obscured this). Even in the depths of total war, the Nazi state declined to expropriate capitalists, with the exception of Jews. But notwithstanding this cleaving to economic orthodoxy, the Second World War vastly expanded the scope of the state and led to the election of "reconstructionist" governments, typically of a social-democrat stripe, in many countries after the war. But from the beginning, these governments were reluctant to confront capitalists and soon acquiesced in a return to austerity. Far from marking a retreat of neoliberalism, les trente glorieuses marked its steady march towards hegemony.

If there is a symbolic moment that marks the triumph of neoliberalism it wasn't the fall of the Berlin Wall in 1989 but the Nixon shock in 1971. That brought to an end the Bretton Woods system and in particular led to the gradual removal of exchange controls and thus the free movement of capital. From that point onwards we see the steady spread of neoliberal practice throughout the developed world and the emergence of what would later be termed the Washington Consensus in respect of its relations with developing nations. The point to note here is that it took 50 years for neoliberalism to achieve that victory. Had the Second World War not happened, perhaps it might have been quicker, but the war happened because neoliberalism promoted Fascism. I suspect that the end of neoliberalism may take as long. Trump's first Presidential win marked the culmination of a phase of neoliberal decay that started around the millennium and became obvious in 2003, with the Iraq War marking the end of the delusions of liberal intervention. It became inarguable in 2008 when the banking crisis marked the end of financialisation as a substitute for material production. 

Subsequent attempts have been made to deal with the fallout, notably the imposition (again) of austerity as a way to protect asset values, the adoption of Green New Deal rhetoric as cover for the subsidisation of domestic producers, and the promotion of security interests as a justification for trade restraints on competitors, notably China. Trump's second inauguration indicates the extent to which these developments have now been normalised. Much of the claimed successes of the Biden Presidency were simply an extension of the mercantilist logic that Trump brought into the open during his first term, which is why his return to the White House shouldn't have been a surprise, even allowing for the Democrats' disastrous handling of the nomination process and the subsequent election. If Trump's initial electoral victory emphasised how neoliberalism had failed the democratic majority, his second indicates the failure of institutional politics to respond. But it doesn't mark the definitive end of neoliberalism. For all the distracting nonsense of his initial executive orders, the meat of his programme remains cuts to welfare, deregulation and lower taxes.

In a follow-up blog post, Milanovic notes how the principles of neoliberal globalisation have been in abeyance for over a decade and paints a consequently bleak picture of the immediate future: "It implies the return to mercantilistic policies where the interests of individual countries are paramount. It also means the abandonment of any cosmopolitan and internationalist perspective where the rules are at least in principle universal. We no longer have universal rules and the main culprit for not having universal rules is not Trump, but the view of the world where domestic political interest and the so-called security concerns are above everything else. This is not a world of globalization, but of parceled regionalisms and even nationalism." As a former employee of the World Bank, Milanovic is an evangelist for global development so he sees this as a betrayal. But I think emotion may be clouding his judgement. The interests of individual countries have always been paramount (this is the essence of realism) and the universal rules have always been selectively applied, as Israel frequently reminds us.

Simon Wren-Lewis has also been ruminating about the end of neoliberalism and the dynamics of what comes after: "the main political battles in many countries [will] be between on the one hand socially conservative right wing plutocratic populists and on the other centre or centre/left parties tentatively moving away from neoliberalism." That "tentatively" is doing a lot of work, as is the implication that the movement would be leftwards. Just consider two of Keir Starmer's recent pronouncements. First, the commitment to "ruthtless" public spending cuts in support of Rachel Reeves's fiscal rules. Second, his paean to the idea that the fairy dust of AI can transform public services and that selling off public data is a price worth paying for what amounts to little more than hype. These are the classic tropes of neoliberal utopianism: the liberation afforded by technology and the discipline of markets. With its rejection of nationalisation, its antipathy towards welfare and its belief that deregulation will spur growth, this is a government that remains in thrall to neoliberal practice. Insofar as the Labour right intend to move anywhere, it is, as Phil Edwards notes, to a "position where it embraces policies which would have been more characteristic of a far-Right party forty or fifty years ago".

Wren-Lewis makes an interesting point about international dynamics: "Increasingly the populist plutocratic right is an international project, and Trump’s victory gives its national representatives much more power. The UK is far from alone in having to contend with this kind of political interference. There is a danger that individual national governments that are not right wing populists may be too weak to combat this attack, particularly when resistance can result in economic retaliation from Trump in the form of tariffs." This may raise a rueful smile among anyone in a country that has historically had to put up with interference by the West, or where the only acceptable forms of government are those that satisfy the IMF and World Bank. A sub-text of much liberal commentary on the costs of Brexit has been the idea that the UK has been relegated from a nation that interferes in the affairs of others to one that is intefered with.

The plutocratic right has always been an international project, specifically to ensure the free movement of capital. When democracy looks like it might get out of hand, i.e. threaten private property, capital will up sticks and move elsewhere. Capital mobility is not simply about finding the best return but about minimising the risk of expropriation or (what amounts to the same thing in the minds of many capitalists) taxation. What has been little reported on is the way that initially isolationist and even autarkist rightwing movements have been repurposed in recent years, e.g. the anti-EU Front National became the grudgingly pro-EU Rassemblement National. This isn't due to any electoral calculation but because of pressure from its rich backers. While many saw opportunities in Brexit, notably the deregulation of capital flows through the City of London, few see similar opportunities in Frexit, with the country's continuing presence in the EU market being far more important to domestic and foreign capital. 

According to Wren-Lewis, "The fight against right wing plutocratic populism is not like previous post-war political battles between the right and left, over how society should be organised to best serve its citizens. Instead it is a battle over whether politics addresses the real world problems voters face, or whether it is instead preoccupied with a fantasy world." Politics has always dealt in fantasy, not least in the postwar era, from Churchill warning that Labour's 1945 manifesto heralded the arrival of a British Gestapo to Thatcher insisting that only monetarism could save British industry and reduce unemployment. As ever, what matters is not what people claim to believe but what those ostensible beliefs indicate, e.g. "Gestapo" was the hyperbolic inflation of worries about a nanny state but at root it reflected a fear that the state would seize private property. Likewise, monetarism was a technocratic rebranding of sound money: the idea that the interests of savers should trump those of consumers.

Wren-Lewis isn't simply wrong in his history here, he is obscuring that what we are faced with is not a novel situation but simply the latest round in the struggle between socialism and capitalism. The determination to rule out the possibility of any form of socialism has resulted in the advance and inevitable fall of governments of the ostensible "centre-left". They are incapable of reviving neoliberalism in its progressive, internationalist guise, but are also unwilling to properly embrace the legacy of postwar social democratic nationalism. Some have flirted with the idea of a national economy to outflank the far-right, but their unwillingness to consider nationalisation means they usually settle for a rhetorical nationalism that shades into xenophobia. The UK government promising to crack down on people-smuggling while opening up the NHS to foreign companies being illustrative.

Donald Trump doesn't mark the end of global neoliberalism because there is currently no effective opponent of neoliberalism within electoral politics. Until such time as there is, there can be no alternative and so neoliberalism will stumble on like a Zombie. The characteristics of its latest phase -  the populism, the plutocracy, the austerity - are simply amplifications of the nature of neoliberalism itself: the subversion of democracy to preserve property rights and impose the costs of capital's externalities on the general population. The re-emergence of a historically mild form of social democracy during the last decade, which was ruthlessly curtailed by the political establishment in both the UK and the US, indicates that the democratic appetite for an altenative exists, a point paradoxically reinforced by growing electoral disengagement. At present, it may seem hard to imagine how this could happen again, but it looked even less likely before 2015. Neoliberalism is dying and this gives rise to many morbid symptoms, not the least of which is the tendency to mistake a contingent form of rhetoric for substantial interests. The struggle of the last 100 years has been between democracy and private property, or socialism and capitalism, if you prefer. That isn't about to change.

AI Will Save Us All

One of the debates loosely collected under the rubric "The Great Stagnation" during the last decade was the question of why the productivity gains of the IT revolution were disappointing. This was an example of a failure of perspective, particularly in its comparison of the last quarter of the 20th century with earlier revolutions and the adoption of general purpose technologies (GPTs) such as steam power and electricity. Productivity is relative, not just temporally (producing more today from the same inputs than we did in the past) but spatially. The slow dissemination of technologies in the 18th and 19th centuries gave the UK a notable "first mover advantage", so much so that this phrase became pervasive in discussions of startups around the millennium. The lesson of history was that gradual dissemination, as much as government policy (e.g. protective tariffs or import-substitution), drove the catch-up of competitors with equal or better natural endownments such as the USA and Germany in the late 19th century. The greater rapidity of dissemination in subsequent technological waves, enabled in part by the cumulative effect of those earlier GPTs, has meant that first mover advantage has shrunk: a narrowing of the window of opportunity for the relative out-performance of peers. 

When all countries get the benefits of a new technology almost simultaneously the impact is diffused globally, but it manifests in different local productivity growth rates depending on the prior technological level. In simple terms, there is scope for a bigger step up in some areas than others. Consider the sub-Saharan African countries that skipped fixed-line telephony and went straight to cell networks and widespread smartphone usage after 2010. While the continent remains bedevilled by many structural impediments, it is now expected to be the second fastest growing region after Asia in coming years. Robert Solow's 1987 quip, "You can see the computer age everywhere but in the productivity statistics", was what you might expect from an MIT professor focused on the American economy. What he didn't seem to appreciate is that just as neoliberalism shuttered much of American industry and exported capital to peripheral nations, so it also exported productivity gains that might otherwise have been seen in the domestic data.

Perhaps the greatest impact of the IT revolution was that it enabled globalisation. While it was the container revolution and the falling cost of shipbuilding (as it moved to Japan and South Korea) that created the hard infrastructure for a huge increase in global trade, it was IT that enabled global inventory management and offshoring, which is why globalisation accelerated in the 1980s, not the 1960s. In other words, the productivity gains were revealed among developing nations able to leverage both the technology and low labour costs. Western corporations were able to tightly manage this process through technologies such as email, ERPs and CRMs, not forgetting the rapidly expanding and more reliable telecoms and datacoms that we nowadays take for granted. One part of the puzzle of Japanese stagnation, which started in the 1990s when North America and Europe were (relatively) prospering, was the country's reluctance to let go of the technologies that had powered its earlier boom years, such as fax machines and floppy disks. Other countries have read this as a lesson to embrace new technologies as soon as possible, which brings us to the current vogue for government AI strategies.

Much of the promise of AI is based on the assumption that it will drive productivity gains, but this can only be temporal rather than spatial because its dissemination is likely to take place pretty much everywhere at the same time. This is a consequence not only of that narrowing of the window of opportunity due to cumulative GPT waves (the most recent being the now-pervasive Internet), but because the technology itself is dependent on its concentration into global businesses that will necessarily seek maximum profit, and therefore rapid global spread, over national advantage (the tension between the MAGA right and the tech-bros in the US over immigration policy is reflective of this). Countries like the UK that produce national strategies for the development of AI as a productive industry, centred on light-touch regulation, facilitating infrastructure and leveraging "national data libraries", are seeking to combine the prescriptions of neoliberal development economics with the dirigisme of the postwar era, much as Joe Biden's administration in the US attempted more widely in respect of industrial strategy. It's not clear that this can succeed politically. That the electorate won't see the benefits any time soon is obvious, even to those who don't understand the technology. That AI's impact on wages may further erode the social solidarity necessary for a welfare state is perhaps less obvious as we try to peer through the hype.

The problem is that while the UK may well retain its position as a leading AI research centre this won't necessarily translate into a sustainable and significant economic advantage relative to other nations. What government subsidies will do is help defray the costs, both in cash terms and more importantly in terms of environmental externalities, for those global businesses that will dominate the sector, almost all of whom will be American. And you can be confident that they will pay minimal tax on their UK operations. But if the spatial advantage is likely to prove illusory, what of the temporal advantage? Will we at least see an above-trend improvement in domestic productivity? The first point to make is that if British firms have been slow in adopting new technology and working practices up to now, as evidenced by the poor productivity data, then it would seem unlikely that they'll suddenly embrace AI. The rate of the application of technology reflects multiple factors but the decisive one is usually management culture, and it's no secret that outside certain sectors and pockets (typically foreign-owned firms) British industry has poor calibre management.

The second point to make is structural. The UK's under-performance in productivity growth relative to its peers isn't because it lacks high-productivity businesses - there are many - but because of the composition of the national economy. The most obvious factor is the size of the service sector relative to manufacturing. Though the latter has shrunk relative to the former in all developed economies, the shift has been greater in the UK over the last 50 years. Achieving productivity gains in services is more difficult than in manufacturing where newer technology is often decisive. In services, productivity gains are limited by the human factor (the Baumol Effect), the greater difficulty in applying best practice to processes rather than tools, and by the low costs of entry (less need for plant and machinery). The latter encourages smaller, under-capitalised firms, which is a notable feature of the British economy. This is exacerbated by a tax regime that indulges sole traders ("Be your own boss"), small businesses (particularly family firms preserved by generous inheritance rules) and lifestyle companies (i.e. where the priority is a comfortable living rather than productivity).

If there is a strong sense of deja vu about the UK government's rhetoric about AI it is not simply because of its obliviousness to the structural peculiarities of the domestic economy or its proud technological illiteracy but because it sounds remarkably like the paeans once sung to globalisation by Tony Blair: "I hear people say we have to stop and debate globalisation. You might as well debate whether autumn should follow summer. They're not debating it in China and India." Thus Keir Starmer's recent article for the Financial Times opens "Artificial intelligence is the defining opportunity of our generation. It’s not a technology that is coming. It is already here, materially changing lives." The conclusion to the piece managed to be both needy and manic: "Put simply, that’s our message to anyone working at the AI frontier: take a look at Britain. Our ambition is to be the best state partner for you anywhere in the world. We can see the future, we are running towards it and we back our builders. Because we know that AI has arrived as the ultimate force for change and national renewal."

The cultish overtones are not just evidence that Blair's crazed eyes glanced approvingly over Starmer's speech. They point to the increasing desperation of the Prime Minister and his Chancellor as they find their economic strategy unravelling before their eyes. The idea that the financial markets would reward the return of "the grown-ups" to office has proven as naive as the idea that the UK could be shielded from the global turbulence now taking another turn as the implications of the second Trump Presidency are assessed. Insofar as Rachel Reeves had a plan, it was to defuse the Tories' fiscal bombs, provide enough extra funding to stop the NHS immediately keeling over, and otherwise sit tight and hope that improved business confidence would drive growth. Again, this studiously ignores the track record of the UK economy: the frothy nature of financial services growth around the millennium, the permanent scarring caused by austerity after 2010, and the sluggish bounceback after the pandemic as zombie SMEs staggered on. The fundamental problem of this government, like the New Labour administrations before it, is not that it doesn't understand technology but that it doesn't understand the UK economy. AI won't save Britain and it won't save this government.

Musk and the Cartel

The era of the political cartel, which broadly coincides with the neoliberal ascendancy, has been marked by both a rigid ideological conformity ("There is no alternative") and by a promiscuity in the exchange of policy positions. Ostensibly social-democratic parties adopting austerity and market discipline may be the most obvious example of this tendency, but we've also seen centrist parties adopt rightwing obsessions around multiculturalism and trans rights while rightwing parties reliant on wealthy donors have claimed to be the true "workers' party". Some of this is simple opportunism, but it also reflects a steady erosion in the transmission mechanisms of voter representation. With party members having less say in policy formation - a fact that coexists quite comfortably with a growing saying in leadership elections - and mass membership giving way to a hardcore of loyalists for whom policy is a second order consideration, party leaders have found it easier to flex their platforms. They have also found it convenient to rely on think-tanks for policy ideas. That these ideas are often contradictory and lack consistency is not an issue: they're in the business of selling products to meet short-term needs.

The result has been a growing disillusion among the wider electorate, reflected in falling turnout and low confidence ratings. The current Labour government's lack of popular support owes less to the traditional cynicism of "They're all the same" and a lot more to the feeling that they don't actually stand for anything. This makes Labour paradoxically predictable (they'll change nothing) and unpredictable (what promise will they renege on next?) It also makes it easier for "policy entrepreneurs" to disrupt the political field by offering the appearance of certainty, so long as they are willing to operate within the boundaries of the cartel (Nigel Farage is a member of the club, Jeremy Corbyn is not). Much of the increasingly common platform to be found on the centre-right, and which they have adopted in competition with the far-right, is made up of bold promises that could not possibly be fulfilled, such as the change to the ethnic composition of the nation. Unless you are prepared to go full Israel, there is no way to satisfy the expectations of racist and bigoted voters, which are about their neighbours (or some mythical London) rather than asylum seekers in small boats. 

A current example of this is the leader of the UK Conservative Party demanding a public inquiry into the "rape gangs scandal", despite there having already been multiple public inquiries that occured while the Tories were in government and whose recommendations they then largely ignored. This amnesia reflects more than political chutzpah. It highlights that policy adoptions are nowadays meaningless in opposition - something many Labour Party supporters are now ruefully realising - and should certainly not be taken as a guide to future action. They serve rather to position particular politicians relative to the perceived preferences of the party membership. A perfect example of this was Robert Jenrick, whom Kemi Badenoch defeated in the last Conservative Party leadership contest and who is now Shadow Justice Secretary, upping the ante by claiming that the "scandal" reflected the failure of integration and that multiculturalism had corrupted the rule of law. It's obviously nonsense, but more importantly it does not offer any kind of realistic solution, just bile. As such, it is very much in the tradition of Enoch Powell's "Rivers of blood" speech. That Jenrick has not been sacked tells you how far we have come since 1968.

In time-honoured fashion, the BBC has decided that the best way to address this unedifying sight is to ask Nigel Farage for his opinion. This is not simply a case of rightwing bias but a consequence of the structural imperatives that arise from the ideological flexibility of the cartel allied to his own talent at giving the media what it wants: unevidenced assertions, radical rhetoric not backed by substantive policy, and carefully calibrated outrage. The "Stop the boats" meme is a good example of the way that ideas first floated by the far-right (recall Katie Hopkins comments about "cockroaches") can spread horizontally across the political spectrum, even as the focus changes ("We are going to treat people smugglers like terrorists", according to Keir Starmer). This happens because there is only a weak countervailing vertical transmission from party members. Farage is attuned to this reality, hence his own party has little internal democracy and is run as a de facto private business. His BBC interlocuters, like Laura Kuennsberg, are also attuned to the need to defend their status within the politico-media class: peer pressure matters more than public opinion.

The recent intervention of Elon Musk into British politics has been fascinating less for the obvious ignorance he has displayed (hardly surprising if you get your understanding of the world from X's algorithms) than for the confusion it has sown among the UK's politico-media caste. At the level of government, this reflects the simple realities of the US-UK power dynamic. Just as Labour politicians like David Lammy, who once derided Trump as a "a woman-hating, neo-Nazi-sympathising sociopath", now seek to kiss his hem as President, so they and others will accord Musk respect so long as he is seen as a favourite of the White House. Indeed, they will actively jostle to become his domestic agent. But Musk's intervention also highlights the weakness of contemporary political parties, notably the inability of the membership to enforce an even vaguely consistent line on the leadership, and the relative power that the media (whether old or new) has in framing public discourse. There are exceptions to this - e.g. the organic protests over Palestine that both the parties and the media have done their best to suppress - but in general public discourse has become coarser and more stupid as the cartel has flourished.

The tussle on the right between the Conservatives and Reform looks like an internal party contest over a declining (and passive) membership, but the importance of members has been over-stated. Shorn of their role in policy formation and with their ties to wider civic society attenuated by the decline of trade unions and volunteer organisations, party members these days are little more than occasional canvassers. And that is a trend that suits all parts of the cartel, as the pushback against Labour under Corbyn, and the subsequent membership decline under Starmer, clearly demonstrates. The fragmentation of the media since the 1980s has allowed politicians to rely more on direct contact with voters rather than indirect contact through members. A lot of the hesitancy over Musk arises from the fact that he is now a more effective conduit than Lord Rothermere, despite the steep decline of UK accounts on X. Where rightwing newspapers used to set the agenda of the BBC and ITV, it is now more likely to be social media, and particularly an outrageous tweet by Musk himself. This reflects the reality of American empire but it also reflects the decline of party democracy.

Liberal Nihilism

In a review of the Serbian historian Miloš Vojinović's The Political Ideas of Young Bosnia, Branko Milanovic draws a parallel between the assassination of Archduke Franz Ferdinand at Sarajevo in 1914 and the recent killing of UnitedHealthcare CEO Brian Thompson in New York: "When youth is idealistic and when making political change is impossible, individual acts of terror appear as the only venue left." The review is interesting on Vojinović's exploration of the milieu that formed Gavrilo Princip, but the connection between 1914 and 2024 is tenuous, to say the least. The most obvious difference is that Luigi Mangione, the chief suspect of the New York killing, was not (as far as we know) a member of an organised revolutionary society called Young America. The media has long treated political violence schizophrenically: oscillating between its characterisation as the actions of deranged individuals and the product of a malevolent conspiracy that compromises entire social groups. A good example is the recent murders in Magdeburg in Germany, where the press has been torn between the narrative of a lunatic loner and the idea of an Islamist sleeper.

The popular response to Thompson's killing, and in particular the ironic canonisation of Mangione, recalls the "propaganda of the deed" that distinguished revolutionary violence in the late-19th and early-20th centuries. This depended on the conflicting role of the emerging mass media as both the agent for the state's official narrative and as the broadcaster of revolutionary demands and slogans, which led during the IRA's campaign in the latter half of the 20th century to various constraints on the media in an attempt to deny them the "oxygen of publicity". In contrast, Mangione's memeification is an organic product of popular anger with the costs of healthcare in the US, not the calculated PR of a revolutionary group. Likewise, the debate around the motives of Taleb al-Abdulmohsen, the chief suspect at Magdeburg, has largely been conducted through a selective trawl of his social media output. The turgid manifestos of loners (Valerie Solanas, Ted Kaczynski, Anders Breivik) have given way to briefer statements, of which the shell casings incribed "deny", "defend" and "depose" may prove to an apotheosis.

In today's Observer, Kenan Malik extracts two themes from the Magdeburg killings. The first is his usual hobbyhorse of the dangers of identity politics. Malik has carved out a media role as the liberal alternative to Spiked! in decrying the rise of identity politics since the 1970s. It's important to note that neither is sincere is arguing that this has supplanted class analysis to the detriment of progress, in the manner of Ellen Meiksens Wood. Rather they are accentuating identity as a problematic, either in defence of a traditional working class ideal that turns out to be reliably reactionary, or in attacking a misguided indulgence of conservativism that undermines liberal universality. That Abdulmohsen has not presented himself in identitarian terms, and has even insisted on his secularist credentials, does not present Malik with any problems: "We may never know Abdulmohsen’s motives". He simply insists that "understanding western jihadism may help throw light on his actions". For Malik, the key is the degeneration of Islamism to the point where "The line between ideological violence and sociopathic rage has been all but erased". 

In other words, Malik is highlighting a propensity to nihilism, which roots his analysis in the paranoid, anti-democratic narratives of the late-19th century. He then segues to his second theme: anti-politics. Noting the failure of neoliberalism to "end history", and the serial failures post-2008 to challenge the neoliberal orthodoxy, he imagines that "Anger without change has led to a growing sense that politics itself is the problem." This isn't much use as analysis, if only because politics has always been the problem. The idea that there is a better politics is a liberal delusion (and the raison d'etre of the Observer). Our politics reflects the reality of our society. Malik would be better off asking why we are so poorly served by our political institutions rather than trying to psychoanalyse the population. He ends his piece with this spectacular confection: "Wannabe jihadism, racist populism and individual acts of nihilistic terror can seem disconnected phenomena but all are in very different ways expressions of disaffected rage while trapped within the cage of identity in an age of anti-politics." There is no diagnosis here, let alone a prognosis, merely a hyperbolic pessimism that ironically echoes the nihilism it decries. 

For a little light relief you could turn in the same issue of the Observer to the editorial on the 250th anniversary of Jane Austen. This identifies the famously parochial novelist's continuing popularity, even "modernity", in the way that her characters offer a necessary corrective to contemporary failings: "The hallmark of our age is emotional incontinence. Nothing is held back; our individual wants and needs are paramount. The pathos of Austen’s prose, however, is derived almost entirely from her characters’ adherence to convention, and thus to self-sacrifice. In their reticence and restraint, we find a well of emotion that’s all the deeper for being so quiet and constrained: a profundity that returns us ultimately to what’s important, which is not ourselves, but other people – whether we love them, or not." Austen's popularity only begins during the late-Victorian era and didn't fully flower until the 1940s. She is modern in the sense that she appealed to a postwar nostalgia for the economic and social dominance of the English gentry. In the context of her own times, which were artistically dominated by the emotional incontinence of the Romantics, she was a minor figure whose "two inches of ivory" reflected a conscious turning away from the wider world of agrarian revolt and industrial modernity as much as her own constrained circumstances.

Her reticence and restraint extended beyond matters of the heart to the source of her characters' wealth (e.g. the slave trade) and the class politics of the time (e.g. Luddism). She was, and remains, a true Tory. That the Observer should praise her is no surprise. The paper has always had a soft spot for romantic Tories and the sale to Tortoise Media is likely to accentuate that (yet more profiles of Rory Stewart alongside regular updates on Jess Phillips' state of mind). Nor does it surprise that the editorial should emphasise her emotional continence and bemoan that "self-discovery of a certain kind [has] become horribly central to our culture". I'm only bemused that it didn't rope in the usual attack on social media (maybe Carole Cadwalldr's influence is waning). Just as Kenan Malik's gloomy angst recalls the Edwardian liberal mind, so the paper's indulgence of Austen reflects the steadily-growing liberal backlash against all things "woke", from trans rights to Palestine. Committed to propping up a Labour government that lacks meaningful policies and whose instincts are conservative, the Observer is reduced to a combination of liberal nihilism and anti-modern nostalgia.

The Heavy Thud

Keir Starmer's speech a couple of weeks ago was widely seen as a challenge to Whitehall, which owed everything to the Prime Minister (or his speech-writer's) tendency to sprinkle his deathless prose with clunking metaphors: "Our plan commits Whitehall to mission-led government. An approach to governing that won’t just deliver change but also change the nature of governing itself. ... Make no mistake – this plan will land on desks across Whitehall with the heavy thud of a gauntlet being thrown down. A demand, given the urgency of our times, for a state that is more dynamic, more decisive, more innovative; less hostile to devolution and letting things go; creative - on the deployment of technology harnessing its power to rethink services rather than replicate the status quo in digital form." To make sure the message got through, he even combined a recent Americanism with a standard postwar lament: "I don’t think there’s a swamp to be drained here, but I do think too many people in Whitehall are comfortable in the tepid bath of managed decline."

A few days earlier, the Prime Minister had appointed a "safe pair of hands", Sir Chris Wormald, as his Cabinet Secretary, which suggests that continuity rather than change may prove to be the order of the day, but he again took the opportunity to up the rhetorical ante: "To change this country, we must change the way government serves this country ... From breaking down silos across government to harnessing the incredible potential of technology and innovation, it will require nothing less than the complete rewiring of the British state to deliver bold and ambitious long-term reform." Leaving aside his penchant for 1980s management speak, this is a continuation of the new public management rhetoric that Tony Blair did so much to advance around the millennium: new ways of working and the smart application of technology can radically transform the state. I emphasise rhetoric because the actual practice was, to borrow a term, tepid. After all, Blair didn't drag the machinery of government into the 21st century. If he had, Starmer wouldn't be trying to sell us on a complete rewiring job now. 

Blair's technophilia was (and remains) notoriously shallow. Another area in which he has been consistent is the claim that political delivery is hampered by the machinery of government, a mantra that Starmer is happy to repeat. In his review of the "gauntlet", Andrew Grice in the Independent rehearsed a now-famous anecdote: "As Jonathan Powell, Tony Blair’s chief of staff and now Starmer’s national security adviser, put it: 'When you arrive in Number 10 and pull on the levers of power, you discover they are not connected to anything.'" This is misleading in suggesting that power is exercised by some procedural mechanism, rather than by persuasion, lying or bullying. People have to be made to do stuff. Blair didn't lead the UK into the quagmire of Iraq by pulling the Iraq quagmire lever but by twisting arms, dissembling and intimidating any opposition. It's also an example of projection: the conservative reluctance to actually change anything substantial, which underpins the protestations of progressive intent, is attributed to the state's functionaries, thereby exculpating the political class. Grice duly obliges with another anecdote: "Ministers tell me Starmer’s criticism is justified. Some have been shocked by the quality of the civil service they discovered and by how slowly the machine cranks into gear."

I'm confident that many civil servants will also have been shocked by the quality of ministers and their advisors, but the narrative of ineptitude is one that the liberal press only tends to deploy in respect of its foes, for example Trump's appointees in the US or leftwing shadow cabinet ministers when Jeremy Corbyn was Labour leader. The implication is that ministers and top civil servants are from different tribes, mutually surprised by their strange habits and alien mindset, but nothing could be further from the truth in the UK. To start at the top, Keir Starmer is a former civil servant who ran the Crown Prosecution Service, not an arm of the state noted for its dynamism or innovation, while Rachel Reeves is a former Bank of England employee, even if she did fluff up her CV. In terms of their social backgrounds, Labour ministers are quite similar to senior civil servants: Oxbridge, a complacent respect for meritocracy and very limited expertise outside of the traditional sectors of law and finance. They have far more in common with each other than either does with Conservative politicians.

Grice is also revealing about ministers' archaic understanding of organisational dynamics and their naivety about technology: "Wormald will need to make cross-departmental working happen; ministers grumble there is still a “silo mentality” in Whitehall. His other challenge will be to introduce AI into public services; it could deliver huge savings and boost productivity, which has not returned to pre-pandemic levels." AI isn't being sold on its potential to boost public service productivity, i.e. deliver more for the same cost, but on its potential to cut service delivery costs in line with the Treasury's across-the-board 5% target. A little vignette from today's news is the report that civil servants are thinking of standardising their document-sharing technology: "No 10, for example, uses Microsoft to share documents, while the Cabinet Office uses Google, leading to frequent delays as people pass information from one department to the other." The issue is not "silos" (email exists) but dumb purchasing. You have to pay Microsoft a licence; Google's tools are free. 

The point is that government's long track record of IT project failures and wasteful procurement is the product of both ministers and senior civil servants and their common groupthink. The institutions of the UK state inevitably reflect the culture and overlapping ideology of the leading political parties. This is a synergistic relationship at the top level, not among the ranks: lowly DWP staff don't influence the parties any more than CLP members influence Whitehall. The revolving door between the senior echelons of the parties and business is the same revolving door that exists between the Civil Service and business. Just as Whitehall colours politicians in power, as humorously portrayed by Yes, Minster, so the politicians, and increasingly their burgeoning special advisors, colour Whitehall. If you want to understand why the state appears overly-legalistic, technologically illiterate and wedded to a bureaucratic and bossy approach, you could do worse than note the CVs of the political class, which bias towards the law, parasitic business and the public/private nexus of the third sector. 

The apparatus of the state, long-used to a duopoly of alternating governments, is obliged by the prime directive of any organisation (to preserve itself and minimise change) to find common ground, which in turn encourages the parties to move towards a mid-point between their positions on the political spectrum. This will occasionally be disrupted by a genuine shift in the political consensus, such as after 1945 and 1983, but opening up a gulf between the parties invariably leads to a countervailing readjustment: pressure to "close the gap". This is not just a political calculation by the opposition to keep adjacent to the governing party by accepting much of its programme as a fait accompli. It also reflects the pressure exerted by Whitehall to maintain continuity once the administration changes (in other words, inertia). What is notable is that these major shifts tend to come roughly 40 years apart (you can include the 1905 Liberal government as well, with its constitutional and social reforms), so we're arguably due a genuinely reforming administration around now. But while Labour under Starmer have been happy to push the rhetoric of progressive reform, their actions have been either underwhelming or positively conservative.

The long periods of Tory rule mean that there is an ideological bias towards them within Whitehall over-and-above any sympathy due to class or culture. This is famously apparent in the Treasury's commitment to "sound money" and its preference for the interests of savers over workers, but it is also evident in other areas of government from the Foreign Office and Ministry of Defence (both still important components of the social elite) to the various welfare departments where a minatory attitude towards claimants is embedded within their systems and organisational culture. This explains why Labour have historically been more prone to decrying the conservative resistance of the "men from the ministry", but also why the Tories took up a similar complaint against "the blob" after 13 years of Labour government. But while the rhetoric suggests a return to that progressive critique of Whitehall, the lack of any criticism of the Treasury, and the dominant role that it has taken in insisting on cuts to other departments' expenditure, tells you that this will be a conservative government in all but name.

It is highly unlikely that Keir Starmer would lead a revolution in the machinery of government anyway. He climbed the greasy pole by working with the system, not against it. He is not a natural disruptor by temperament and he isn't going to indulge a gadfly like Elon Musk, let alone another Dominic Cummings. Morgan MacSweeney's priority will remain control of the Labour Party, not reform of the state apparatus. Starmer's project is the restoration of the state's authority and dignity after the twin insults of Brexit and Corbyn, and while that means showing that the state can be trusted to deliver, it also means avoiding chaos. While Tony Blair continues to yearn for national ID cards, Starmer and his lieutenants are focused on the more mundane task of filling in potholes. Possibly using AI. A thoroughly unoriginal and uninspiring man, his eventual memoirs will no doubt repeat that tired old Jonathan Powell anecdote but presumably garnished with a clumsy metaphor about not having the right tools to do the job.