Election Wishlist - a Special Series on How to Reboot Britain

With a surprise General Election called, significantly accelerating timelines, election manifesto drafting has become an urgent task across political parties. 

Over the coming weeks we are doing a special series of blogs to explore some of the biggest challenges and opportunities facing the UK. It will offer a radical “wish list” for policy makers of what to do, and by implication, what not to do.

“It’s the economy, stupid”

The UK, along with much of Europe, is in decline. Following the 90’s, similar stagnation in Japan was called a “lost decade”. Having failed to reverse this trend, Japan has since suffered from three lost decades. Unfortunately, things are not much better in the UK. 

After almost two decades of stagnation, Britons are rightly frustrated. According to ASI analysis of World Bank data, the UK’s real GDP per capita  only rose 1.3% over the seventeen years between our 2007 peak and 2024, in total. By comparison in the seventeen years preceding 2007, it grew 141%.

For many, particularly younger generations, they are actually worse off even in real terms, as the distribution of these tiny (per capita) gains are not evenly distributed. Younger generations have particularly seen their rents rise significantly faster than their wages.

While inflation has now returned to normal levels, it reached its highest peak since 1980. Despite the denial of the Bank of England, inflation was not a transitory phenomena, and it was avoidable.

The tax burden has been consistently rising too. Inflation-driven fiscal drag and other tax rises have undermined claims of tax cuts. So while Britons have seen their incomes stagnate, taxes have risen.

“It’s the economy, stupid” became the mantra of Clinton’s 1992 U.S. presidential election. Similarly, the “Keys to the White House” prediction system uses the short-term economy and long-term economy as two key checklist items to assess the situation of the country ahead of an election. Political fortunes can rise and fall for many reasons. While other factors are also important, including the relative charisma of candidates, foreign policy outcomes, social conditions and perhaps even the campaigns themselves, elections are heavily influenced by economic circumstances. 

Leadership not Point polling

More broadly, voters over time judge based on outcomes and whether they feel the country has been governed well. Polling provides a diagnosis as to what is electorally popular, However, polling topics in isolation is not the path to long term success. It ignores the salience of policies or their long term impact.

Popular policies may not be effective policies - the public look for leadership and judge outcomes too. Slavish devotion to point polls can lead to vacuous policies that distract Government or worse, to bad policies. Bad policies deliver bad outcomes, and bad outcomes are unpopular. By contrast, some good policies may be unpopular in the short term, but if they delivery prosperity, they can be rewarded electorally long term, as Thatcher found with her three successive electoral victories.

So, while this series offers some reflections on the electoral feasibility of its recommendations, its primary focus is on what policy makers ought to do, rather than on what will deliver short term popularity alone.

Crisis of collectivism not capitalism

Today our politics is plagued by corporate cronyism (interventions to support special interests), de-growth (policies that hinder growth), vetocracy (blocking development of all kinds), and safetyism (risk aversion). 

The common theme is the destruction of the price mechanism, and decision making guided by the state rather then the markets. Collectivism has won the day, not as a radical top down plan or through ownership of the means of production, but through a steady expansion of the frontiers of the state across almost all domains. 

Decline is not an inevitability. Things do not have to be this way. A brighter future for Britain is possible. The solutions are already known to us, and have often been proven to work in the real word.

The path to restoration lies in re-embracing the power of markets, promoting innovation, protecting our free society, and defending the rule of law at home and abroad.

This series will explain how across key areas of government.