https://www.lrb.co.uk/the-paper/v46/n22/william-davies/a-crisis-in-credibility

Before​ Labour took power in July, there was a lot of talk about ‘foundations’, and it has continued since. The second chapter of the party’s election manifesto was titled ‘Strong Foundations’. On the fourth day of the new administration, Rachel Reeves gave a speech outlining the ways she planned to ‘fix the foundations of our economy’. In a pointedly downbeat speech given in the garden at 10 Downing Street in August, Keir Starmer stressed that his ‘project has always been about fixing the foundations of this country’. A slickly presented policy essay appeared online in September, co-authored by three right-wing think tank wonks, outlining the various ways in which governments since 1945 had thwarted economic growth. Its title was Foundations.

The first thing to note about the ‘foundations’ metaphor is the resonance with construction. The ‘Strong Foundations’ chapter in Labour’s manifesto was accompanied by an image of brickwork. Buildings without foundations fall down (like Britain under the Tories), and building is what Labour is placing more hope in than anything else, with a pledge to deliver 1.5 million new homes by 2029, a rate not achieved since 1977. Politicians have for generations donned a hard hat for construction-site photo ops, but rarely can any party have arrived in government with its ambitions so tightly tethered to bricks and mortar. Reeves has argued that Britain’s current planning rules are the ‘single biggest obstacle to our economic success’. In the more sardonic language of the Foundations report, Britain’s economic problem is that, thanks to planning restrictions, ‘investment is banned.’

A second connotation of ‘foundations’ is that they exist for the long term. The obvious contrast here is with the hedonism of the Johnson era and the brief mania of the Truss experiment, which did more for Starmer’s poll ratings than anything else. To focus on ‘foundations’ is to think about the future in a responsible way. But it also implies something less politically palatable: the benefits aren’t going to be felt for some time. Labour’s strategy to date has been to share as much bad news as possible, blaming it on the irresponsible Tories and readying people for more difficult times ahead, in the hope that the electorate is still listening by the time it gets its delayed gratification.

The challenge Labour has set itself is to modernise the technological and legal foundations on which Britain’s economy is built: the transport hubs, energy supply, planning rules, market regulators – rather like an upgrade to a computer operating system. At the government’s recent ‘international investment summit’ in London – to which superstar American CEOs were lured with the promise of an audience with Elton John and the king in St Paul’s Cathedral (proof, apparently, that Britain is ‘open for business’, or more plausibly that desperate times call for desperate measures) – Starmer switched to a clumsier metaphor. ‘We are in the business of building on our strengths. Mowing the grass on the pitch, making sure the changing rooms are clean and comfortable, that the training ground is good. So that when our businesses compete, they are match fit.’ Leaving aside whether clean changing rooms have any impact on fitness, his point was this: the dynamism of the private sector is shaped in crucial ways by the regulations and infrastructure that underpin it.

Put these implications together, and the message is clear: Labour is doing something that the Tories were too selfish and frivolous to do. You can’t necessarily see it (it’s mostly underground), and it’s going to take a long time, but one day – when it finally translates into greater prosperity – you’ll be glad. This carries the political risk that by the time the next general election comes around the government will be so unpopular that nobody will care how the economy is doing (John Major lost such an election in 1997). On the other hand, the government is already pretty unpopular, while being exceptionally powerful at Westminster, so long-termism makes sense. The 2024 election had the bitter distinction of delivering the second largest majority (174) since 1945 on the lowest vote share (33.7 per cent) of any winning party – an indictment of Britain’s electoral system but also an indication of widespread alienation from mainstream politics. Take slumping turnout into account and only one in five of the electorate cast a ballot to deliver Labour’s overwhelming victory. Whether or not Starmer views things this way (and his air of paranoia suggests he certainly feels it), the strength of the Labour government is a symptom of a long-standing legitimacy crisis. And at this early stage, it appears that its strategy for resolving the crisis rests heavily on economic realism.

The central fact of British economic development since the global financial crisis is that productivity growth has slowed significantly, from a pre-2008 trend upwards of 2 per cent to a post-2008 trend of 0.4 per cent. This has resulted in wage stagnation and minimal GDP growth, which has in turn meant that public spending has failed to keep up with social needs, in some cases dismally. On this there is now a consensus. Why productivity growth rises and falls over the long term is among the most contentious problems in economics; it potentially opens out onto questions of history, politics and sociology, at least when economists have the curiosity to engage with such things. Even so, there is also now a consensus that if productivity growth in Britain is to rise, then investment (in skills, technology, buildings, start-ups, infrastructure, R&D and so on) needs to be higher. At the investment summit, Starmer demanded that global firms release the ‘shock and awe’ of investment – as if he were imagining Google and BlackRock raining missiles down on Britain.

Investment requires an ethos of patient optimism. Max Weber saw the mentality of the investor, who forgoes pleasures now for some predictable benefit tomorrow, as the crucial ingredient of capitalism. Without investment, capitalism ceases to function as capitalism, turning instead into legalised extortion and quasi-feudal estate management – practices that Britain has grown rather good at in recent years. Flatlining business investment was the most marked and sustained economic injury of Brexit – not just the kind of slow puncture that afflicted exports, but a dramatic turning point coinciding with the referendum. Opinions differ as to how much investment should come from the state, how much from business, and how much from some contractually murky combination of the two, but the extent to which left and right now agree on the roots of Britain’s economic malaise is striking. ‘The only way to deliver economic growth,’ Reeves said when delivering October’s budget, ‘is to invest, invest, invest.’ In the past, low investment levels might have been blamed on high interest rates (a charge Gordon Brown repeatedly levelled at the Tory record prior to 1997), since it is harder to invest when it’s more expensive to borrow, but that explanation fell apart during the 2010s, when the lowest interest rates the Bank of England had ever set failed to have any impact on investment. The problem today feels more systemic and historic: a wholesale crisis in the credibility of Britain and its future.

Eight years on from the referendum, the result of which is now endorsed by a shrinking minority of voters, Reeves is not embarrassed to parade her elite technocratic credentials. Her speeches over the last two years have zeroed in on Britain’s productivity problem, and her economic advisory council is led by John Van Reenen, who has dedicated as much of his career as anyone to grappling with it. But there is a feeling of Groundhog Day. In 1998, Gordon Brown commissioned a report from McKinsey on ways to tackle the productivity gap between Britain and its competitors, which yielded precisely the kinds of recommendation – including ripping up the planning system – that are now getting so much play in Westminster. Following the Tories’ election victory in 2015, George Osborne launched a new productivity plan for Britain. Its title: ‘Fixing the Foundations’.

Why then might the next five years be any different? One reason is that the problem is now so dire as to be unignorable. The combined effects of the financial crisis, Brexit, Covid and war in Ukraine have resulted in economic conditions far graver than those on which McKinsey was consulted at the end of the 1990s. This reality can no longer be papered over with a successful financial services sector, discrete acts of redistribution or the distractions of culture wars. The ‘cost of living’ crisis is, in an immediate sense, caused by the effect of inflationary forces on energy and food prices, but the degree of suffering it has wrought is due to seventeen years of wage stagnation, unprecedented in industrial times. It may be an act of noble honesty, political naivety or both, but Starmer and Reeves have evidently reasoned that they cannot set about promising a brighter future without confronting the present blight.

More exciting for Westminster policy nerds has been the emergence of a new set of ideas in the US, which Biden’s Treasury secretary, Janet Yellen, has called ‘modern supply-side’ economics. ‘Supply-side’ economics conventionally refers to the conservative doctrine that the way to increase economic growth is to cut taxes, especially on capital, business and the rich, on the grounds that this will increase incentives to invest and innovate. Government, on this account, typically gets in the way of enterprise, obstructing entrepreneurs and business strategies with its regulations and taxes. The aim of liberating the ‘supply side’ was originally a break from Keynesian orthodoxy (which held sway until the 1970s), according to which governments should stimulate growth by intervening on the demand side, getting more money into consumers’ pockets through welfare spending and wage increases, while using public procurement to funnel money towards domestic industries.

When Yellen coined the term ‘modern supply-side’ in early 2022, she was seeking to distinguish the Biden administration’s programme from both the Reaganite ‘supply-siders’ and ‘old Democrat’ Keynesians. By this point, Biden had emerged as an extraordinarily big-spending president. The American Rescue Plan Act passed in March 2021 and the Infrastructure Investment and Jobs Act passed the following November together provided a $2.45 trillion stimulus to America’s post-Covid economy. The following summer the CHIPS and Science Act and Inflation Reduction Act further contributed to the Rooseveltian fiscal splurge. At face value, this appeared to be good old-fashioned Keynesian demand-side policy. Yellen’s terminology suggested otherwise, that the expansionary programme was being targeted at the key technologies, industries and infrastructure – the foundations – on which American businesses and entrepreneurs would depend in the future. The intention was to raise the overall productive capacity of businesses, not by slashing taxes or regulations (the original ‘supply-side’ creed) but by investing in domestic production and infrastructure – especially green energy and related technologies – that would allow other industries to flourish.

This ‘modern supply-side’ vision was also more sceptical of ‘globalisation’ than recent Democratic administrations had been, and mindful of precisely where investment and production take place. Following the brazenly nationalistic and protectionist Trump programme, the Biden White House cleaved to its own economic version of ‘America First’, deploying a new fiscal activism to nurture domestic manufacturing and revive those regions most afflicted by postindustrial decline over the last half-century, many of which – not coincidentally – were where Trump had collected working-class voters. The gamble was that a more ebullient industrial policy, which drew a clear line under ‘globalisation’ and ‘neoliberalism’, might turn the tide on right-wing populism, and perhaps even save the republic. This strategy was never without its critics; it may now be ripped to shreds amid the post-election infighting.

The role of private investment remains controversial. Biden’s spending programme was vast, but it was geared towards ‘crowding in’ investment from the private sector, using tax credits, subsidies and public-private partnerships, to raise its profitability and reduce risk. Critics on the left view this as a vast handout to Wall Street, especially those giant asset management companies – BlackRock above all – which have it in their power to decide on the destination of trillions of dollars. Nothing symbolised the London investment summit quite like the photograph of Angela Rayner, the deputy prime minister, clasping the arm and whispering in the ear of Larry Fink, BlackRock’s CEO.

There was growing disquiet as the geopolitical implications of the Yellen and Biden agenda became clear. The surprisingly progressive dimension of the agenda – the drive to exploit the sociopolitical crises of Trump and Covid to build a new egalitarian model of capitalism – lasted barely a year, before giving way to anti-China mercantilism, potentially more dangerous to world peace than anything Trump’s administration had done. Jake Sullivan, Biden’s national security adviser, was one of many voices declaring the age of neoliberal globalisation, in which growth is good regardless of geography, to be dead; but what followed seemed to involve weaponising economic policy to ramp up domestic industrial production for a new cold war. Yellen herself morphed into a national security spokesperson, making it clear that America would put security above economic growth, ratcheting up Trump’s trade wars, and leaning on European allies to join in for their own protection.

The sense of​ grand ideological wheels having turned is enthralling, but it isn’t clear what the implications of ‘modern supply-side’ economics are for a country such as Britain, cut adrift from its most important trading partners, with a GDP smaller than that of California and any hope of global hegemony long gone. The agenda was cast as ‘new productivism’ by one of its progressive adherents, the Harvard economist Dani Rodrik, since it seeks to intervene deliberately in the productive capacity of the nation. Yet American productivity growth seemingly remains beyond the reach of most European countries, not only Britain. The US suffered the inflationary surge of 2021-23 just as Europe did – and it proved to be crucial in the election – but its energy costs have long been significantly lower than those in Europe. Finding a way to get energy costs down is arguably Europe’s most pressing supply-side challenge. Reeves has cribbed some of the Yellen-Sullivan rhetoric, aiming to fuse economics to national security priorities with the neologism ‘securonomics’, which she set about promoting in spring 2023 in speeches given in London and Washington. The question is how much of this is rhetoric and diplomacy, and how much the reflection of a shared reality.

If Labour and the Democrats have had a policy priority in common, it is political more than economic. Democracy in both the US and UK is frayed; dangerously alienated sections of society have acquired routes into mainstream politics and mass media that were unavailable fifteen years ago. The 2016 ‘Brexit-Trump’ shock felt like a shared event in some way. The electoral breakthrough of Reform this summer, followed by the sight of far-right mobs on English streets mobilised by online conspiracy theories, confirmed the threat of MAGA-style politics in the UK, which a Tory Party led by Kemi Badenoch could choose to intensify. Confronting such forces takes more than money, but parties of the liberal centre, which historically represented working-class interests, cling to the hope that democracy can be rescued, if only people get to witness the material benefits that government can deliver. What the Democrats hoped to do for the rust belt, Labour may now be hoping to do for those areas of the North-East where Reform is the main opposition party.

There are plenty of good economic reasons to invest heavily in green energy infrastructure, not to mention the graver ecological ones. The political reasons are more complicated. Do voters notice the difference made by infrastructure projects that take several years to come online and even longer to influence productivity and wage growth in the economy at large? And will voters credit the government that made the investment in the first place? Anecdotal evidence of the effects of the Inflation Reduction Act makes painful reading for Democrats: even if voters are glad of the new industries and jobs in their regions, they don’t make the connection with a government and a coterie of political insiders that they stopped trusting years ago. States such as Michigan and Wisconsin have benefited from investment, but they still voted for Trump. You don’t need to journey as far as the Midwest to encounter this disconnect. EU Structural and Investment Funds were distributed generously around North-East England and South Wales to deliver better roads and broadband infrastructure, and we know how much good that did the Remain campaign in 2016. Recall, too, the case of London’s ‘Boris Bikes’ – the popular cycle hire scheme initiated by Ken Livingstone.

Labour has trumpeted its policies of a National Wealth Fund and Great British Energy, both state-led efforts to ‘mobilise’ or ‘catalyse’ private investment into infrastructure, green energy generation and strategically important manufacturing such as clean steel. No doubt we will hear lots more about the ‘national’, ‘British’ and ‘Labour’ aspects of these over coming years, and less about the fact that the NWF is effectively a rebranding of Rishi Sunak’s UK Infrastructure Bank, or about the dwindling public funds that Reeves has scraped together for these projects. The NWF’s aim is to raise £3 of private investment for every £1 of public money, with individual financial deals struck for each port or gigafactory that it backs. As with the Democrats, the nationalistic rhetoric helps to conceal a land-grab by asset managers. Starmer’s priority will be a surge of new houses, factories and turbines that he can point to in 2029, and for this to be associated in voters’ minds with the Labour government. It would be no mean feat. But economists, including those in the government’s Office for Budget Responsibility, believe that the next election will come around before any of these ‘supply-side’ investments have had any impact on the rate of economic growth.

Reeves finds herself in a different situation to Yellen, not least in her perceived fiscal freedoms. Bidenomics was born at a time when interest rates were on the floor as monetary policymakers tried to fend off a Covid-induced depression. The intervening years have pushed up the cost of borrowing significantly. The build-up to the recent budget was dominated by talk of the squeeze on Reeves’s ‘fiscal headroom’, and even some hawkish fears that her borrowing plans would spark a Truss-style bond sell-off. That never materialised, though interest rates on government debt did creep up and markets are now less confident that the Bank of England will be able to cut its base rate as quickly as many hoped. The cost of servicing the national debt over the next five years is now projected to be £100 billion a year, more than the allocation for schools.

Reeves and Starmer’s platform requires them to inhabit a contradiction. They need to demonstrate what a bold, fiscally ambitious, ‘mission-driven’ government can achieve – yet their greatest ambition is to get back to the normality (of between 2 and 3 per cent growth per year) that was taken for granted until the financial crisis. Politically, they need to reassure voters that they are not offering more Osbornomics; the public sector will be given a chance to recover from years of punishment. But economically, they need to reassure bond markets (and mortgage holders) that they are not offering anything like Trussonomics, and recognise what Starmer refers to as the ‘harsh light of fiscal reality’. There is a lot of tub-thumping about how wonderful ‘Britain’ is, but at the same time we’re told that the country is an economic basket case, left to rot by its previous leaders. Somehow, government needs to ‘go big’ and ‘go small’ all at once.

We are left with a version of Bidenomics, but without the ultra-cheap credit and mercantilist sabre-rattling – or the fiscal privileges of the dollar. As of 5 November, Labour will no longer be able to appeal to the intellectual hegemony of their American counterparts to guide and justify their plans. One avenue that remains open is to let the ‘modern supply-side’ agenda slide back into an older ‘supply-side’ neoliberalism, at least where regulation is concerned and especially on land use. This is plainly what the authors of Foundations are hoping for: they promise that ‘If allowed, private investors would be rushing to build housing, transport infrastructure and energy infrastructure,’ a fantasy the right has entertained since the 1970s. Labour is not wholly unsympathetic to this argument, as Starmer made clear at the investment summit. Meanwhile, for all the talk of ‘catalysing’, ‘mobilising’ and ‘crowding in’ investment, Britain already has its own term for a government alliance with finance capital: the private finance initiative or PFI. The statist or social democratic elements of Labour’s programme could end up being reduced to a glorified nation-branding exercise, akin to the ‘GREAT Britain’ advertising campaign that seeks, among other things, to convince international firms to set up shop in the UK.

Hopes of averting this outcome rest heavily on tweaks to Reeves’s ‘fiscal rules’, which dominated financial commentary in the build-up to the budget. The aim of such self-imposed rules is to satisfy the bond markets that governments have set sensible limits to their borrowing plans, and are behaving rationally and predictably (as opposed to ‘politically’) in their spending decisions. The bond markets don’t like politics to be exciting and novel; this is why October’s budget felt less like an event and more like a rubber-stamping of what had been trailed over the previous weeks. Labour entered government with fiscal rules stipulating that all day-to-day expenditure had to be balanced against revenue, and that debt must be falling relative to GDP within five years. But these rules don’t help much when you’re trying to break out of long-term stagnation: if the economy isn’t growing fast enough, they provide little leeway to increase the kinds of spending that might encourage faster growth in future. Reeves spent the summer searching for a justification of higher borrowing – specifically for public investment – which would convince the bond markets that she wasn’t throwing caution to the wind. What she wanted was a new, slightly more capacious straitjacket.

A number of respected mainstream economists and business leaders had already argued that Britain’s borrowing rules needed to be relaxed to make way for greater public investment. The logic is relatively simple. Rising investment leads to rising productivity growth, which leads to rising GDP growth, which means higher tax revenue and lower borrowing requirements. The problem is the amount of time this takes and the uncertainties (such as elections) that arise as a result. OBR figures suggest that a permanent increase in public investment of 1 per cent of GDP should lift national output by 2 per cent – but only after more than ten years. This is not the time horizon that voters, politicians or bond-traders usually have in mind.

The new fiscal rules continue to constrain regular day-to-day spending on public services, meaning that increased funding of, say, health and education will continue to be possible only if the economy is growing (which it currently is, but not by much) or if taxes are rising. The headline number emerging from the budget was that taxes would rise by £40 billion a year, taking the overall tax take to a record 38 per cent of GDP by the end of the decade. Overall public spending will settle at around 44 per cent of GDP (this is 5 per cent higher than pre-pandemic levels, and nearly 10 per cent higher than during Tony Blair’s first term). All of this continues the drift to a high-taxing, high-spending state that is the legacy of prolonged economic stagnation and Covid. It has many of the macroeconomic properties of social democracy, but confers little on-the-ground experience of it. More than half of those extra taxes will be swallowed up by the NHS, which will help ameliorate Tory neglect, but not necessarily be felt by patients. A cash injection on that scale, backed by the largest tax rises since 1993, does at least draw a clear political battle line. With the Tory press incandescent about tax increases (especially in such fiscally minor, but politically eye-catching areas as inheritance), Badenoch would struggle to commit to Labour’s health spending.

Where things have changed slightly is with the second fiscal rule, regarding the size of the public debt. Previously this was measured in terms of total national liabilities (all of the bonds, or ‘gilts’, that government has sold to date), but it will now take into account national financial assets as well, a measure known as ‘Public Sector Net Financial Liabilities’. This includes such things as student loans (which, being owed to government, represent ‘assets’), but more pertinently the financial investments government makes in industry or infrastructure, so long as these can be liquidated relatively easily. Government can’t simply sell a hospital or submarine at short notice, so these do not show up as ‘assets’ by this measure. But if the NWF needed to quickly recoup its investment in, say, a windfarm, the expectation is that it could do so, as it is operating like a commercial investor (in partnership with other commercial investors). Borrowing to invest in this way will, in principle, show up on both the ‘assets’ and the ‘liabilities’ side of the national balance sheet. It certainly involves more borrowing, but doesn’t increase the national debt.

Reeves announced​ this change before the budget itself, at the IMF’s annual meeting in Washington. The IMF rode to the defence of the budget in the days after it was delivered, reporting that Reeves was ‘sustainably raising revenue’. This well-choreographed sequence was as much a testament to the time the Treasury team must have put into global political networking as it was to its economic expertise. But as the dust settled, it wasn’t clear how much difference the new accounting framework would actually make. Borrowing (and the resulting interest payments) will rise to fund capital investment, and PSNFL will be in decline by the end of Labour’s term in office, all as promised. But until the economy starts to grow (Starmer has pledged to deliver the highest long-term growth rate of any G7 nation), this whole fiscal agenda remains incomplete. Without growth, the doom-loop of rises in tax and/or borrowing will continue, only somewhat mitigated by the extraordinary levels of immigration witnessed since lockdown ended. On this, the OBR delivered unwelcome news: growth would slacken after an initial boost. Public investment would deliver dividends at some point down the line if sustained, but not on the scale or at the speed Reeves needs it to. Labour must be hoping that the OBR is wrong about this, that the mysteries of productivity growth are too uncertain for national accountants to model, or perhaps that fiscal policy will turn out to be a less powerful ‘supply-side’ tool than rewriting regulations, confronting nimbyism and cosying up to BlackRock. In the meantime, Labour finds itself in a bind: too fiscally responsible to unleash the white heat of technology and infrastructure, but too fiscally ambitious to soothe in the long term the nerves of its creditors.

The period following the global financial crisis was a time not just of economic stagnation but of a perceived epistemological crisis, crystallised in the language of ‘fake news’ and ‘post-truth’. As the hold of legacy media over news and information disintegrates in favour of dubious online influencers, trust in journalists and politicians has continued to be eroded. Business elites and financial markets are comparatively untroubled by these developments: the circuits of economic intelligence – financial media, elite business schools, global consultancy firms and so on – are sufficiently well supported and capitalised that they can withstand the crosswinds of populism and conspiracy theory. CEOs, economists and bond traders are free to inhabit a kind of ‘consensus reality’ that roughly corresponds to what is reported in the Financial Times. But this is not true for politicians of the liberal centre, who are forced to engage with audiences who consider them to be liars and worse. Starmer and Reeves made some clear mistakes over the summer, but even so the collapse of their approval ratings between the election and the budget was unprecedented. This must be put down in part to the depth of anti-political, anti-government sentiments at large in society, which policy promises and speeches are powerless to alleviate (though the ratings rebounded a little bit after the budget).

There is no simple route out of this crisis. The days of New Labour ‘spin doctoring’, which fluffed up political reputations by means of careful control of the news cycle, are gone. Britain has experimented with putting an entertainer in Downing Street in the form of Johnson, then a radical (of one kind) in the form of Truss, and learned hard lessons along the way. Starmer is neither of these things. When Starmer or Reeves speak, most people aren’t listening, while many of those who are listening make a point of not liking what they hear.

There is one thing that everyone agrees on, however, whether they are economists, politicians, business leaders, journalists or voters: the country is in a very bad way. This mood caught liberals unawares in 2016 on both sides of the Atlantic, leaving them looking complacent and out of touch. There is a cultural dimension to this pessimism, which nationalists are so adept at speaking to, with their euphemistic references to a past when identities and borders were more fixed. But there is also an economic aspect, which has particular purchase in Britain, given its dismal record since 2008. Those who appeal to cultural pessimism typically regard academics and experts as part of the problem, but economic pessimism has plenty of highly credentialled adherents, including the OBR, and many have lined up behind Starmer and Reeves to endorse the path they have embarked on.

The Starmer-Reeves project is not ‘Keynesian’ in its policy logic, but it has a Keynesian flavour in another respect, which it shares with the Biden administration that is drawing to a close. The gambit is that an elite-led, technocratic programme of renewal can revive the conditions under which liberal democracy can thrive. This depends less on politicians winning people over through rhetoric and values (the assumption being that politicians won’t be heard or believed anyway), and more on bringing people back into the fold of the nation by improving their material conditions. On this account, the way to restore trust in politics is to stop talking and start building, doing whatever is necessary to make that happen. A correct diagnosis and treatment of the nation’s economic sickness, the reasoning goes, will eventually alleviate its feelings of cultural sickness too, until overall confidence in ‘Britain’ returns. The advantage of the original Keynesian policy toolkit over the ‘modern supply-side’ approach is that the former urges politicians to deliver now, as there is no time to waste. A mantra of ‘invest, invest, invest’, however, also translates into ‘wait, wait, wait’.

Few of the details of this investment project are cut out for democratic consumption. Reeves and Starmer are relying on the intricacies of macroeconomics, private finance and professional asset management to turn the country around, without the resources of sovereignty that are available to a US president. Their route to the next election has begun by getting bond markets, business leaders and the IMF on board, in the hope that in time they will win the public over too, once the abstractions of finance capital and national accounting are brought down to earth in the form of gleaming new buildings. The way to hit back against populism (and whatever cultural pessimism Badenoch nurtures in the coming years) is to give up on describing reality as it is, and focus on constructing a new one with a government logo on it. The problem is that this takes time, and politics moves at its own speed. Starmer can talk all he likes about needing two terms to fix Britain’s foundations – the economics of productivity growth suggest that he’s right – but that doesn’t mean he’ll get them. Meanwhile, Badenoch must be licking her lips at the thought of all the nimbyism waiting to be pandered to in marginal constituencies, should the government achieve its goals on planning reform. Most awkward of all, Starmer’s style of politics is crafted for a post-trust democracy but implicitly depends on trust’s cousin: gratitude. Labour may well have the expertise and the plan to ‘fix the foundations’, but that doesn’t mean, a few years from now, that voters will remember to thank them.