Imagine you are a seller. Of something; it doesn’t matter what, for now. Beer. Poetry. Advice on how to pair tapas with sherry and vermouth. Translations into Icelandic.

You have a choice between two (otherwise similar) markets. In Market 1, there is one huge buyer who accounts for close to 100% of market demand (=a monopsony, which, for the non-economists, is like a monopoly but on the demand side). In Market 2, there are a large number of small and medium-sized buyers, none of them big enough to have a detectable impact on overall market outcomes. Which market do you prefer?

Up until this point, it would seem like a complete no-brainer. Of course you would prefer Market 2. In Market 1, you are at the mercy of that one single buyer. In Market 2, you can choose between lots of different buyers. If one of them offers you a price or conditions that you consider unattractive, you just sell to a different one.

Monopsonies are great if you are the monopsonist, or if the monopsonist is, in some way, acting on your behalf. But they are not so great if you are a seller. That, at least, is what the Economics textbook says. It is also what the Health Economics textbook says, specifically in the context of single-payer healthcare systems: the single-payer is a monopsonist who can keep costs down, because medical professionals and suppliers have nowhere else to go. If so, the same should logically apply to a ‘National Care Service’, that is, a nationalised social care sector, and idea that is currently being floated (although we have no details yet).

There’s one problem with the monopsony argument, though: actually existing monopsonies don’t always act the way the textbook model would predict.

I noticed this a few years ago in the context of a doctors’ strike. A colleague suggested to me that we should use this strike as an opportunity to reach out to disgruntled doctors, and make the idea of free-market reforms in healthcare more palatable to them. We could tell them that the NHS is able to keep their wages down because it is a monopsonist, and that they would be better off in a pluralistic market system. It sounded like a good idea to me. Until I looked up the numbers on medical salaries in the OECD, and realised that the evidence was not on my side. British specialist doctors, in particular, are not badly paid. Sure, you can find countries where their peers do better, but these are richer countries where everyone is doing better. If we express medical salaries as a multiple of national average salaries, British specialists actually do quite well. Not exceptionally so, but enough to disprove the idea that the NHS acts as a wage-suppressing monopsonist.

Graph: Remuneration of specialist medical practitioners as a multiple of national average wage, 2024 or latest available year

-OECD Data Explorer

So what explains the difference between the textbook model of monopsony behaviour, and the behaviour of the NHS as an actually existing monopsonist? And what would a National Care Service be more similar to – the textbook model, or the NHS?

I know what you’re thinking: isn’t the issue simply that the textbook model assumes a commercially driven monopsonist, or at least, a monopsonist that acts like one? Isn’t the issue simply that the NHS is a political enterprise with soft budget constraints, which simply has no interest in making use of its monopsony powers?

But that is not quite right. American pharmaceutical companies that do business with it very much do see the NHS as a tough negotiator that knows how to make use of its dominant position – that is why the issue of drug pricing always comes up in UK-US trade negotiations. In their dealings with drug manufacturers, the NHS behaves exactly like the textbook model of a monopsonist.

So why does the NHS use its monopsony powers so selectively? Why does it use them to suppress drug prices, but not wages?

The economic literature on monopsony behaviour emphasises the proximity of ‘outside options’. Monopsonies are rarely absolute: you can be a monopsonist in one market, but that still leaves sellers with the option of exiting that market altogether, and selling elsewhere. But that cannot be the answer to the above question. Accessing outside options is much easier for an American drug company than it is for a British doctor. For the former, ‘accessing the outside option’ means bypassing the UK market (at least for a while), and prioritising the French, the German and/or the Japanese market instead. For the latter, it means emigrating to Australia. The NHS has much greater monopsony powers over its domestic medical workforce than it has over international drug companies. And yet, it uses those powers against the latter, but not the former.

To make sense of this pattern, we need to move beyond pure Economics, and take a Political Economy perspective. Forget conventional measures of market power, and instead, let’s think about the political standing of different stakeholders.

Drug price negotiations are usually not high-profile, but when the issue does come up in the context of trade negotiations, it is always presented as absolutely scandalous that drug companies want to make money. ‘US-UK drug deal could result in 229,000 excess deaths in England, analysis suggests’, reported the Guardian last month. In that context, there is no way the public would ever side with the drug companies against the NHS.

In contrast, doctors’ strikes are usually presented as a conflict between ‘the NHS’, and an unsympathetic government (which probably secretly hates the NHS, and wants to privatise it). In that context, the public will, of course, side with the doctors. In economic terms, the British government may have monopsony power, but the political economy of the health service prevents the government from using it.

Where does this leave our hypothetical future National Care Service?

A National Care Service would not have the same sacred status as the NHS, even if it were technically part of it. ‘Our National Care Service, the envy of the world, no other country has social care’ – that won’t happen. But a monopsony social care provider will nonetheless change the political economy of social care in other ways.

In his Golders Green speech, Andy Burnham told the assembled care workers that they should be among the best-paid people in the country. People may not take that entirely at face value, but if you set up expectations in that way, you will not be able to pivot to a policy of pay restraint later.

Burnham’s expectation-setting may not even be the main issue here, though. Burnham said that, because he knows that it’s popular. There are plenty of surveys on the popularity of different professions, and the results are exactly what you would expect. People like doctors and nurses. People hate politicians, journalists and business leaders. Care workers are not specifically included, but it is not wild speculation to say that they would be seen as more similar to the professions at the top end of the popularity distribution.

Burnham talked about how this popular group should be highly paid, but he did not blame anyone in particular for the fact that they are not. Because, in the current system, there is no specific person, group of persons or institution that you could blame. Nobody ‘decides’ how much social care workers should be paid. If you think they should be better paid, there is no specific person, group of persons or institution that you need to convince. It is an impersonal market outcome.

In a monopsony, it would no longer be. If we had a National Care Service, people would – correctly – start to see pay levels in the social care as the result of a political decision. There would be someone who makes that choice, and that someone would get the blame if they made a choice that people don’t like. For that reason alone, a National Care Service would almost certainly lead to higher staff costs in the sector without any concomitant productivity gains, or increases in our willingness to pay.

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The fragmented nature of the social care sector may, in fact, be a good thing, because it de-personalises decisions in the sector. In a National Care Service, these decisions would become heavily personalised, and we would be placing impossible demands on those persons.

Most of the ink spilled over the peaks and troughs of housebuilding in Britain revolves around two observations.

First, that housebuilding used to be healthier and more consistent before the Town and Country Planning Act 1947, with the exception of the collapse in housebuilding that occurred during the two World Wars for understandable reasons.

And second, that most housing provision used to be supplied by the private sector unassisted up until the full regulatory impact of the TCPA 1947 was felt. Following this, Britain went through a brief period of significantly lowered construction, most of which was delivered by local authorities, until it returned to the old trend where private provision became dominant once again but extremely bottlenecked.

The peak of British housing construction occurred in the decades between 1920 and 1940, roughly covering the interwar period. None of the subsequent periods in peacetime have achieved similar levels since. Many people have investigated this phenomenon in depth, and I won’t go through the details again, but the reasons revolve around a sequence of poorly designed regulations that dilute property rights and empower an anti-development vocal minority with unwarranted veto powers.

Now that that’s settled, I came across an iconic map of New York showing the decade in which every building was built, and it got me thinking. We know for a fact that nationwide, and in London in particular, construction of new housing in the two decades between 2005 and 2025 doesn’t come anywhere close to the levels of construction that took place between 1920 and 1940.

But the distribution is surely not homogeneous! We certainly shouldn’t expect every street and every neighbourhood to underperform the golden era of construction to the same extent, otherwise people would never complain about regeneration projects or ‘gentrification.’ So I set out to investigate.

Using data from the Valuation Office Agency and the ONS dataset catalogue, we can map out London’s neighbourhood areas and investigate the age of the housing stock in different neighbourhoods.

A neighbourhood is assigned the colour green if the area has more buildings from the interwar period than from the 2005-2025 period and red if the opposite is true.

There is of course a caveat that data from the Valuation Office Agency may be incomplete, but the data is comprehensive enough to give us a strong qualitative impression of what housing construction has been like recently.

And we see that the results are anything but uniform. Various parts of London have older housing stock and still look broadly the way they did in the interwar period. For example, in Harrow, 52 per cent of known age homes were built between 1920 and 1940.

In contrast, in some neighbourhoods in Tower Hamlets, over 90 per cent of all housing was built in the past two decades. An interesting visual (for a non-Londoner, at least) is that most of the fresher neighbourhoods with newer housing are concentrated in the centre and along the Thames.

I’ve done a similar exercise for Greater Manchester to get a topical comparison.

Greater Manchester has a greater share of new housing compared to London even in areas where interwar housing stock is dominant. Another difference is that Manchester has more neighbourhoods in its periphery where new housing outnumbers interwar housing. There is no overconcentration in the centre or along the Manchester canals.

Perhaps the most exciting visual clue about Manchester is the obvious abundance of grey areas. You can see on the map the areas of Manchester where active construction has been going on recently either due to unsupported private development or due to guided regeneration schemes. Places like Stockport and Tameside are actively growing areas at a pace that matches or exceeds the golden age of British housing construction.

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As a closing counterfactual, suppose every London borough had built new homes over the past two decades at the same pace as Tower Hamlets. By my back-of-the-envelope arithmetic, London would now have roughly 1.4 million additional homes. Even a fraction of that would have made the city livelier and more affordable.

Marx was dead right about one big thing: capital allocation matters. But his followers were dead wrong about everything else, throwing in with the wrong scheme. Not everyone will agree with my test of capital arrangements: those which maximise economic growth through Schumpeter’s “creative destruction”, specifically the formation, expansion and extinction of companies. I like this yardstick as I want everyone on the planet to enjoy my standard of living or better; and nothing but economic growth for another century or two will achieve this.

I expect there could be more, but as best I know the modern world embraces six methods for allocating capital to enterprises. They are:

• Governments

• Banks

• Industrial companies

• Families

• Criminal organisations

• Markets

At one time or another, most economies have resorted to most of them. All have mixed fortunes.

Governments are in disrepute as allocators of capital following the conspicuous failings of communism as an economic system (including its de facto abandonment by China), as well as the undistinguished record of socialism in such manifestations as post-war Britain, France under Mitterrand, post-independence Africa and India, and so on. Governments turn out to be capable of supervising catch-up policies (Russia from the twenties to the sixties; France during les trente glorieuses), but too weak to resist subsequent pressure from the industries they purport to supervise. At present, the mixed approach of China is testing this limit. Britain is a textbook example of such failings; heaven help us in our current reversion.

Banks look like the real thing: marble halls and corner offices are inherently more dignified than screaming dealers. But inspection shows up capital allocation by banks as troubled, most conspicuously in its salient post-war models, Germany and Japan, largely because of the conflict of interest attaching to banks as lenders and owners. They are reluctant to allow borrowers to go bankrupt, with each country having thousands of zombie companies and several zombie banks. Both countries are now ex-growth.

Industrial companies: Growth from the retained earnings of conventional enterprises runs up against the limits of managerial expertise, eg, Jack Welch’s General Electric in the US, or Philips and Siemens in Europe - all before reconstruction.

Conglomerates such as the zaibatsu / keiretsu of Japan or the chaebols of Korea are configured to share risk internally. They are also brushing up against their limit, as their economies have attained levels at which they no longer profit from such organisations. This said, similar arrangements seem to be emerging in Russia, combined with criminality (see below).

Families: When it comes to mature companies, proprietary sources have had marked failures, eg, throughout Latin America. There have also been some successes, eg, in Sweden, where the “Wallenberg Sphere” dominates the industrial landscape; and more tentatively in the countries of the Chinese diaspora and in liberalising India. Eventually proprietary families become unable or unwilling to continue investing, giving rise to capital insufficiency which threatens growth. Proprietary companies in the German Mittelstand restricted their ambitions accordingly and prospered until the Zeitenwende. For decades the Wallenbergs addressed capital insufficiency by penalising third-party investors with junior paper, ie, with restricted voting rights. At present, tech founders want the same privilege.

Until recently, “friends and family” were the only investors willing to take start-up risk. In the last forty years, Silicon Valley (and to a lesser extent elsewhere) has developed successful organisations for accumulating and actively managing start-up funds, subscribed by risk-tolerant private persons, for choice also offering pertinent expertise. The most successful of these companies are now demonstrating the familiar problems of monopoly.

Criminal organisations also weigh in. The most familiar example would be Las Vegas from the 1940s to the 1980s. Elsewhere, criminals operate openly in Russia: much of the economy is a de facto criminal enterprise; and discreetly in Italy: organised crime forces minority investments upon private firms. I am not aware of this last interfering with everyday management, though I expect money laundering distorts operations in cash businesses. Similar arrangements apply in those parts of Latin America in which narcotraficantes prevail.

Where applying to mature enterprises, the five methods set out above are inherently self-protective. This means they make for oligarchy or monopoly - or, to put a more positive gloss on it, fraternité: order, social solidarity and stability, valued more in some places than others.

Capital markets: Taking the period since the Industrial Revolution as a whole, it has become clear that only capital markets reliably correct errors for established companies. If properly combined with arms-length regulation, there is no better system for correcting oligarchy and monopoly. Capital markets achieve this by pricing capital from day to day, cheapening the cost of new funds for established companies which are succeeding; and by extinguishing businesses which fail, through bankruptcy or takeover. No other method has the resilience to work satisfactorily in the face of the unanticipated circumstances of the long run - that is, after the success of initial catch-up which may attach to any of the other methods for a while.

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The obvious defect is the tendency of markets to boom and bust, exacerbated in 2008 by defective regulation. But only the price formation arising out of liquid secondary markets for capital and derivatives turns out to offer the flexibility and detachment sufficient to allocate capital efficiently and consistently.

Eric Graf writes for Spain’s ABC. He has published numerous books on Spanish Golden Age Literature

As the Chávez-Maduro nightmare comes to an end in Venezuela, the country has a rare chance to tilt the odds of long-term prosperity in its favour. This requires two measures that can be taken even before elections take place: full dollarisation and subsoil privatisation.

Venezuela, like Argentina, is the poster child for why Latin American countries do not need their own currencies. Even “independent” central banks tend to cause more inflation than necessary in the best of cases. In Venezuela’s worst-case-scenario, a politicised central bank destroyed the currency after Chávez seized its control in 2007.

A decade of monetised deficits and forced devaluations left annual inflation at 65,000 percent in 2018. Street vendors wove handicrafts from worthless bolívar banknotes. Eight million Venezuelans fled; the richest Latin American country of the 1970s became poorer than Haiti.

Opposition leaders now plan to make the central bank independent. This is sound in theory; even a mildly competent technocracy would be a vast improvement over Chavista misrule. But politicians should recall that Venezuela suffered from triple-digit inflation just two years before Chávez won the 1998 election. If Venezuela holds a national currency, renewed monetary chaos remains possible. So why not choose the tried and tested, best-in-breed option?

Full dollarisation is the best alternative. According to World Bank data, the three major Latin American countries with the lowest inflation rates from 2004 to 2024—Panama, Ecuador, and El Salvador— are dollarised. Ecuador dollarised in 2000 and reduced an annual inflation rate of nearly 100 percent to single digits in less than three years (at a faster pace than Argentina’s current, exchange rate-led experiment, and without lifelines from the U.S. Treasury).

Panama, dollarised since 1903, became a low-inflation, international financial center without a central bank and without legal tender. Panamanians will choose the U.S. dollar if they remain confident in its properties as a medium of exchange, store of value, and unit of account. There is no government-enforced monopoly.

Dollarisation works because it permanently removes a government’s ability to print money. The immediate benefits are low inflation, a strong currency (in the fiat realm), and minimal currency risk for foreign investors. Most importantly, it provides insulation from reckless politicians. Ecuador’s Rafael Correa, a Chávez ally, was unable to de-dollarise and print money despite ruling for a decade with few limits on his power. The dollar remained more popular than the caudillo.

In Venezuela, the urgency is political. Abolishing the central bank benefits the people but, even in democracies, stakeholders have little incentive to do so. Bureaucrats are drawn to a central bank’s prestige; politicians like the illusion of control; intellectuals falsely equate a national currency with national sovereignty. This is why Venezuela, which is de facto dollarised, should shut down its central bank and dollarise officially while the current, “interim“ government remains in place.

Monetary stability, however, is only half the solution. The state’s ownership of the subsoil has been the other main driver of Venezuela’s downfall. This allowed the Chavista regime to destroy the oil industry in the country with the world’s largest reserves. Chávez filled PDVSA, the state-owned oil company, with cronies and subsidised Cuba’s energy needs. His 2001 hydrocarbons law chased away efficient foreign operators. Production plummeted as profits flowed into a political slush fund.

The American model of private mineral rights provides a contrary example of success. In Texas, the privatised framework decentralised risk in the 1980’s and 90’s, giving a direct profit incentive to the landowners and wildcatters who risked their own capital to experiment with new drilling techniques. This unleashed the shale revolution the following decade. Such breakthroughs are unlikely under bureaucratic and risk-averse state-owned monopolies, even if managed responsibly.

Subsoil privatisation also decentralises economic and hence political power. Texas is so strong vis-à-vis the Washington-New York corridor that Dallas recently launched a national securities exchange. This dynamic is absent under Latin America’s state-controlled model, in which mineral wealth flows from the periphery to a country’s capital to be redistributed—or squandered—at politicians’ whim.

Yet private mineral rights work in Texas because the state found the ideal regulatory framework. Oil drilling is subject to the “tragedy of the commons,” whereby competing neighbors rapidly drain underground reserves that flow through property boundaries. After the industry’s near collapse in the 1930’s, the Railroad Commission of Texas (RRC) has regulated the market successfully with production limits, spacing mandates between wells, and maximum efficient extraction rates for each reservoir. Sound regulation made oil a stable asset class with predictable cash flows and proven reserves that could serve as collateral. Inspired by the system’s efficacy, Venezuelan diplomat Juan Pablo Pérez Alfonzo used it as the blueprint for OPEC, a transnational version of the RRC.

Venezuela should now privatise its subsoil and turn PDVSA into an RRC-type neutral regulatory body. Its commercial assets can be distributed to citizen-shareholders via vouchers. The state’s remaining subsoil interests can be auctioned, with proceeds transferred to all Venezuelans via individual retirement accounts. Public lands can be opened to homesteaders. Current landowners can negotiate for mineral rights beneath their property.

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As Venezuela moves away from socialist tyranny, dollarisation and regulated subsoil privatisation would provide strong pillars for the new republic. Venezuela was already among the world’s richest countries in the mid-20th century. Under the right monetary and mineral rights framework, that feat can become permanent.

• Cambridge and the incentive problem

• Why Britain can’t build a railway

• The AI doomers are wrong about maths

Daniel Freeman is the Managing Editor and Deputy Editorial Director at the Institute of Economic Affairs

Jason Arday, who resigned as professor of the sociology of education at Cambridge on Wednesday amid accusations of extensive plagiarism, is undoubtedly an extraordinary person.

He might or might not have run 600 miles in six days to raise money for charity, been twice chased through the quadrangles of Cambridge by a masked, knife-wielding racist, or been hailed as a man of destiny by a Brazilian prophetess. But Arday has certainly made a story about academic standards and ethics dominate the news cycle for over a week, which is an achievement in itself.

Of course, we shouldn’t be too impressed. The story is not really about him but about a failure of institutions and leadership. How was it that serious allegations of academic fraud were ignored for so long? Why did the Education Faculty and Jesus College, Cambridge insist there was no case to answer? Why were journalists investigating the allegations essentially told to back off by the police?

As is so often the case this is a story that comes back to incentives.

Profit-seeking bodies can of course be taken in by charlatans and fantasists. But the profit motive provides an incentive for firms to sniff out people who are not all they claim to be.

The lack of a clear service to be delivered leaves not-for-profit organisations like charities and universities peculiarly vulnerable to pursuing the ideological hobbyhorses or personal whims of their leadership at the expense of higher goals like academic rigour, the pursuit of truth or high-quality education.

This is not a modern problem. Adam Smith had a low opinion of the quality of teaching at Oxford and Cambridge (which, until the 1820s, were England’s only two universities) which he believed had been ruined by misaligned incentives. In The Wealth of Nations, he observed that university professors in England relied on stipends paid from substantial college endowments, rather than fees from students, resulting in indifferent teaching. Smith claimed that at Oxford:

[T]he greater part of the public professors have, for these many years, given up altogether even the pretence of teaching.

None of this is to say that charitable bodies should be converted en masse into for-profit enterprises. But the price of a non-profit structure is constant vigilance. And the stakes are high. In Cambridge’s case a reputation for academic rigour built up over centuries can be seriously dented in a few years.

Oversight bodies such as college boards of trustees must have the power, information and willingness to restrain agents gone rogue. If leadership undermines the attributes that make an organisation great in the first place, whether in pursuit of feel-good politics or personal aggrandisement, it is essential there is a culture within an organisation that allows those within it to point out that the emperor has no clothes.

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IEA Podcast: Director General Lord Hannan is joined by Editorial Director Kristian Niemietz and Head of Lifestyle Economics Christopher Snowdon to discuss whether America is really richer than Britain, the Government's "social value" procurement rules, and the Cambridge academic misconduct scandal, IEA YouTube

This week on Economic Affairs

News and Views from the IEA

Infrastructure

• Britain spends as much on infrastructure as its peers, but gets measurably less: HS2 Phase 1, at roughly £470 million per route-kilometre, is the most expensive high-speed railway in any international database

• British construction productivity fell by 0.6% a year between 1997 and 2019, while the wider economy grew by 2.8%

• Every French city over 150,000 people has a tram, light rail or metro; around 30 British towns and cities of comparable size have none

• Cancelling the Birmingham to Manchester leg of HS2 will have forgone benefits worth £0.6 to £1.3 billion a year to Greater Manchester alone

• New publication from the IEA by Senior Economist Valentin Boboc sets out how planning and procurement failures have driven Britain’s Great Stagnation

Read the Report

The AI doomers are wrong about maths. Valentin Boboc, the IEA’s Senior Economist, writes in CapX on the row over AI’s recent mathematical breakthroughs.

Boboc’s piece follows two milestones that split opinion online: an Anthropic mathematician’s use of AI to find a counterexample to the Jacobian conjecture, a problem dating back to 1939, and OpenAI’s Astra model solving 10 problems in maths and computer science that had gone unsolved for at least a decade. He argues that academics dismissing the work as crude “slop” are missing the point, since both results were independently checked by peers and verification software.

Boboc’s view is that AI is simply a tool that amplifies the skill of whoever wields it, in the same way early tools boosted the output of a skilled hunter rather than an unskilled one. He notes that non-mathematicians who tried to copy the feat mostly produced incorrect results, while trained mathematicians achieved genuine breakthroughs, and points to evidence that entry-level jobs are growing fastest at firms adopting AI most aggressively, against the fear that the technology simply replaces people.

Dr Valentin Boboc, Senior Economist at the IEA, writes: “AI is a tool, in the sense that it is an extension of its user.”

Why Does It Cost Britain Four Times More to Build a Railway? Daniel Freeman interviews Valentin Boboc on his Great Stagnation chapter on Britain's infrastructure crisis, IEA YouTube

Kristian Niemietz revisits the World Bank's 1994 pension reform blueprint at the Gottfried von Haberler Conference:

If you see a list of the OECD countries that have had a tax on net wealth, you will find that a) most countries realized wealth taxes were a costly mistake and repealed them long since, and b) only Norway, Spain, and Colombia did not, with certain Swiss cantons applying them at the local level. To which a valid, initial response would be to ask why on earth Colombia appears on an OECD list in the first place.

As I argued in 2018, Colombia, a middle-income country, had no business joining the OECD. To start, it revealed a desperate urge to keep up with the Joneses of the developed world, and stagnating continental Europe in particular (a model for the local, anti-American intelligentsia). More importantly, by then the likes of France and Germany were using the OECD to coerce up-and-coming competitors—i.e. Ireland— to raise their low corporate income tax rate to a collectively agreed minimum level, all through the vicious euphemism of “tax harmonisation.”

Since then, OECD membership has burdened Colombian businesses with several new layers of onerous, international reporting requirements. This on top of local regulations, which were unnecessarily bureaucratic to begin with. Plus, Colombian statists now claim—often and chirpily—that the country must raise its tax revenue heavily to match the OECD average of 34 per cent of GDP, even though the current level (22 per cent) is already higher than that of Ireland and Chile, both far richer countries. As it turns out, a high percentage of tax revenue to GDP is no prerequisite for development.

So, the only silver lining I see to being in the OECD is that it left Colombia in the small minority of countries with a wealth tax, but only because this reinforces the message that even most high-tax European states have steered clear of such a harmful levy.

Colombia introduced a wealth tax in 1935 but suspended it in 1992, as the country, once so protectionist it was known as South America’s Tibet, timidly opened itself to global markets.

The current version of the wealth tax dates back to 2002, when former president Alvaro Uribe (2002-2010) re-introduced it via an emergency decree, claiming it was needed to pay for his security policy against the FARC guerrilla group (which was necessary and proved successful). Uribe, who should have looked for other sources of revenue for the military offensive (such as the full sale of the state-owned oil company), naturally claimed that the wealth tax was a temporary, one-off measure. Originally, it taxed net wealth starting at only ~ USD $65,000 (at the exchange rate of the time) at 1.2 per cent for both natural persons and legal entities.

The following year, however, Uribe’s government passed a law that taxed net wealth above ~USD $1 million at 0.3 per cent through 2006. And in 2006, Uribe extended the wealth tax until 2010, raising the rate to 1.2 per cent, while keeping the same threshold and dual taxpayer structure.

Former president Juan Manuel Santos (2010-2018), Uribe’s successor and a friend of Tony Blair, kept the wealth tax during the whole of his presidency. In 2014, Santos also lowered the threshold, which, due to heavy peso devaluation, fell below USD $300,000 at the 2016 exchange rate. Santos also raised the top wealth tax rate to 1.5 per cent, although his government did phase it out for corporations.

Santos’s successor, Iván Duque (2018-2022) also maintained the wealth tax for individuals throughout his presidency—again on a temporary basis—while raising the threshold to ~ $1.5 million at the 2018 exchange rate and instituting a 1 per cent flat rate.

Once socialist former president Gustavo Petro took over in 2022, he made the wealth tax permanent, again lowered the threshold to ~ USD $650,000, and once more raised the top rate to 1.5 per cent of net assets. As Petro’s uncontrolled spending worsened Colombia’s chronic fiscal crisis in 2025, Congress rejected his new attempt to raise taxes. He responded with a series of executive decrees that dropped the wealth tax threshold to ~ USD $500,000, raised the top rate to an exorbitant 5 per cent, and made corporations once again liable to pay it.

Last April, however, the Constitutional Court ruled that the economic emergency decree that changed the rules on the personal wealth tax was unconstitutional, although it upheld the corporate wealth tax decree, which Petro had justified as a response to a flooding emergency.

The wealth tax’s permanency as a temporary measure, its absurdly low thresholds by global standards, and the varying justifications for imposing it in the last 25 years highlight its inadequacy. While relatively easy to collect and never likely to cause large-scale protests, the wealth tax made little difference in terms of total tax revenue. As Lisandro Junco, the head of the tax collecting agency under Duque, put it, the wealth tax has remained far behind the income tax, the value added tax and the consumption tax as a revenue source.

Then there is the issue of capital flight. Although the wealth tax has not been its only cause in Colombia, it is broadly assumed that it is a main component. Between 2010 and 2018, over 8,000 individuals renounced their Colombian citizenship and moved abroad. At the time, the press frequently cited excessive taxation as a main incentive for leaving the country. In 2025, at least 150 Colombians with a liquid net worth above USD $1 million left permanently according to an independent report. Again, the press speculated that many of these émigrés were escaping the wealth tax.

Whether or not these were tax exiles—practically none of them stated it publicly— a chance event did bring the wealth tax into the centre of the public debate. In 2024, a Bogota football club called (oddly enough) Millonarios offered a six-month, ~ USD $500,000 contract to star player Radamel Falcao, the country’s all-time leading international goal scorer.

Falcao, who had lived abroad for two decades, was not a Colombian tax resident at the time. He accepted the contract and was able to play at first without triggering tax resident status, which sets off when an individual spends 183 days in the country during a 365-day period.

The problem arose upon his contract’s renewal in early 2025. Since Colombia’s wealth tax applies to total global net worth, Falcao, by simply becoming a tax resident, would have owed the tax authorities far more in wealth taxes alone than what the team paid him in an annual salary. So, the talks between the player and the team broke down until sponsors stepped in and agreed to pay Falcao’s tax bill if he remained on the roster (which he did until mid-2025).

The Falcao saga showed plainly why wealth taxes are so harmful. First, they are counterproductive because they target those with the ability to live quite comfortably elsewhere. And, as local football fans found out, if you punish success, you merely will keep the successful away. Falcao’s ability to remain in Colombia was an exception; accomplished entrepreneurs and investors will not have recourse to corporate sponsors that will foot their wealth tax bill. They will choose to remain in jurisdictions with lower taxes and a greater respect for property rights.

Luckily, Colombia’s new president, Abelardo De la Espriella, appears to understand the nefarious nature of the wealth tax. During his inauguration speech on August 7, he said that he will get rid of it altogether. “We must stop punishing those who invest and build wealth in our country,” he said, thus unleashing a swell of optimism among the wealth creators that Colombia needs after more than a decade of per-capita-GDP stagnation.

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So, if De la Espriella keeps his promise, Colombia is about to become yet another country that has eliminated a wealth tax (a far better club to join than the OECD). It should serve as a lesson for Britain, California, and other tax-hungry jurisdictions: when it comes to taxing net wealth, the best alternative is not to do it at all.

Their whole shtick is based on sloppy language. The post-liberals, the NatCons, the alt-rightists, the integralists, the Groypers — they base their case on a linguistic trick. Philosophers call it “equivocation”. It means using the same word to mean different things as suits your argument. They do it with two words in particular: “liberal” and “globalist”. It is worth considering them in turn.

The word liberal has an ancient and rather majestic etymology. The Latin “liber” meant a free citizen: someone who was not enslaved. At the same time, from a different derivation, “liber” also meant book.

Those two meanings were blended in the English word “liberal”. To be a liberal was to favour liberty: freedom of speech, worship, association, and contract. It thus meant, by implication, wanting constrained government, low taxes, and strong property rights. Yet it did not mean anarchy. It also meant — this is where the “book” part comes in — a virtuous application of wisdom, a humane tolerance, a generosity of spirit.

The great seventeenth-century poet and philosopher John Milton drew a distinction between “licence” and “liberty”. Licence meant being able to do whatever you liked, and was nothing special. A beast in the wilderness had licence. Liberty, on the other hand, meant making moral choices in the informed knowledge of what might follow.

When the word “liberal” entered our political lexicon from the Hispanic world in the early nineteenth century, it had that high-minded meaning. Liberals were for free trade, property rights, and equality before the law; conservatives were for tradition, aristocracy, and ecclesiastical authority.

In most of Europe, as in Latin America, the word liberal still has this meaning. Javier Milei uses it accurately, unselfconsciously and proudly. But in the United States, starting in the 1890s and accelerating during the 1930s, the word began to mean “left-wing.” Sometimes, the elision was deliberate. FDR, in particular, applied the word “liberal” to various interventionist policies in the hope that its positive connotations would rub off on them. In fact, no semantic trick could make the New Deal successful. Instead of the word gilding progressive policies, the progressive policies tarnished the word. By 1988, forlorn Michael Dukakis voters were waving placards asking, “What’s wrong with being a liberal?”

That shift had “classical liberals” (a retronym that the first-generation liberals had never applied to themselves) scrabbling about for a new moniker. In the 1940s, some began to call themselves “libertarians”, until then a word associated with French radicals and anarchists. In a 1960 postscript to The Constitution of Liberty, Friedrich Hayek bemoaned the ugliness of that “manufactured term”.

Postliberals deliberately blur the two meanings, as Roosevelt did, but from the opposite perspective. Liberalism is their all-purpose boo-word, covering both the traditional sense of “individualist” and the modern sense of “left-wing.” The idea that limited government is compatible with conservative values, that less authority for clerks, licensors and regulators means more authority for school principals, religious leaders and heads of families, is not considered.

An equivalent semantic shift is now happening over “globalisation”. Until an eyeblink ago, that word meant removing barriers so that people were not penalised for, or prevented from, buying goods or services from outside their country. But, over the past decade or so, it has taken on a new meaning. A “globalist” is now someone who wants the world to be ruled from Davos or Brussels. He wants human rights courts to strike down national governments. He wants to send entitled “gimmegrants” across every border. He wants to destroy the West.

Again, the idea that the free flow of goods, services and ideas is itself part of the Western patrimony is not considered. Two completely contradictory notions — one to do with restricting the state’s power over the individual, the other to do with increasing it — are deliberately conflated.

For a lot of people under the age of 25, the older meanings of these words don’t register at all. Argue that tariffs are making us poorer, and they will ask why you want to flood the country with illegal immigrants.

Yet Hayek was right when, in that same postscript, he argued that what was called “conservative” in the Anglo-American world was what Europeans meant by “liberal.” Why? Because the English Whig tradition, and particularly the US Constitution, its sublime culmination, is the epitome of a liberal order.

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When people in the great English-speaking democracies call themselves conservatives, the system they want to conserve is a liberal one – a system that elevates the individual over the collective, process over outcome, the rules over the rulers. The characteristics that make our way of life distinct and agreeable are all, in essence, liberal. The Western order in general, and the Anglosphere order in particular, are liberal. They make us who we are as a people. Let’s not be afraid to use the word.

The BBC is a great force against change. It seeks to freeze UK media in a top down take on what they think we need. Meanwhile the audience moves swiftly into an exciting competitive world of downloads, podcasts, on line videos, movies on demand and citizen journalists getting live clips of events as they happen. As a result the UK is slumping in the media rankings. The BBC slumbered and grumbled as Netflix surged from nowhere to have a turnover already six times the UK ‘s state broadcaster. They watched in denial as Amazon Prime and Disney sold subscriptions to their UK viewers who still have to pay the licence fee if they want to watch any live tv.

There are now more than 18 m Netflix users, 15 m Amazon Prime and 10 m Disney watchers in the UK. When asked what people look at first, 26 per cent say Netflix, 25 per cent BBC and 10 per cent fast rising You tube. This means the revenue, the profits and the investment are surging in the US as the UK state company sees its market share, purchasing clout, ability to attract talent and to win audiences badly squeezed by more fleet of foot and now much more powerful rivals.

The BBC looks to the licence fee for its revenues. More and more people are deciding they can live without live tv, allowing them to watch downloads without paying the tax. The BBC needs more money to spend on technology, new market outlets and on programmes, only to find Comcast, Amazon, Netflix and Disney generate 30 times as much turnover as the sinking UK challenger. We should be in a panic about this collapse. The BBC is now a minnow in the world of fast growing US media giants. 30 years ago Netflix and Amazon Prime Videos did not exist. They have already both dwarfed the BBC.

The BBC has a commercial international company with a pathetically small turnover of £2 bn. This has access to the BBC back book of recordings, but lacks sufficient cut through in the global market. It should be allowed to raise substantial new share capital from private investors with a Golden Share blocking foreign take over. It should spend the money raised on expanding its technical and global reach and adding new content. It should not have recourse to public funds. Currently it receives no cash subsidy and is profitable.

The BBC’s free website service impedes the establishment of competitors who need to charge to cover costs. This needs to be split between a factual and promotional website about the BBC and its offerings, free to users, and a site setting out BBC journalist and commentator takes on life behind a paywall like its competitors. The BBC domestic service model says it is advert free, yet it increasingly uses its remaining home market power to self promote energetically. A recent generic controversial advert has added to the stream of plugs for individual programmes and promotions of BBC people.

Debate about the BBC usually revolves around bias and editorial decisions. Defenders point to the Charter and to the understanding that government that automatically has great influence over funding and personnel should not use that influence to affect comment and coverage of the government. It is true the BBC does give a hard time to Labour, Conservative and Reform interviewees to demonstrate some fairness over parties. Critics allege deeper long term bias in the approach to climate change theory and net zero policies , where they have been a fan, to pro government bias over covid lockdowns, and an unwillingness to question the Bank of England and great quangos like the Environment Agency and Ofwat when they get things wrong. There is a perpetual reluctance to challenge the EU and pro EU soundbites. Coverage of the EU is thin and often uncritical.

My case today is all this political debate caused by the BBC being a state owned and directed broadcaster is getting in the way of growing and using the UK’s great cultural and news gathering potential. It means many do not look at the worrying loss of UK market share. The licence fee model cripples growth and requires a different approach to cost control and economic riskiness of ventures, as taxpayers rightly expect prudence in how their tv tax money is spent. The licence fee money will diminish as technology and US success undermines the numbers of people paying it.

Given the political sensitivity we need to examine new models. Offering everyone a share in a mutual BBC that paid a licence fee could create a people’s BBC. Licence fee shareholders could be guaranteed to keep at least 51 per cent of the total share capital to protect from foreign takeover.A licence fee shareholder could just have one share all the time they had a licence, preserving it as a mutual. Alternatively there could be a single initial grant with people free to buy and sell the shares. There could be a block on anyone buying more than say 10 per cent of the Corporation. The BBC would retain its Charter and requirement to be impartial.

It should set the task to review new sources of revenue and to have a planned phase out of the licence fee. It could go on to raise new capital and add new revenue schemes. It should charge for web access, and could have a variety of subscription and advert based services.

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There would be a taxpayer grant to cover World Service and related news broadcasting in support of a UK cross party foreign policy which would be pro democracy, free speech and impartial news.

Without BBC reform the nation will adopt more and more US services and the Corporation will have to cut and cut again as licence fee income falls.

Every May, trade unionists, socialist politicians like John McDonnell MP, and associated organizations gather in the sleepy village of Burford in Oxfordshire to celebrate Levellers’ Day. There are banners, speakers, the Internationale, a “community group workshop on biodiversity,” and other festivities aimed at preserving the memory of a 17^th century political movement known as the Levellers, whom the celebrants praise for “their wish to abolish property rights and develop an equalisation of wealth.”

In other words, they honour the Levellers as ancestors of the English left. They are right to honour them, as they deserve a place in our national memory, but they are wrong to claim them exclusively for the left. An exemplar is probably the man most associated with the term Leveller during his lifetime, John Lilburne, or Free-Born John.

Born in Sunderland and the product of a Northern grammar school, Lilburne was at first a champion of religious liberty, publishing and importing unlicensed Puritan tracts. This brought him to the attention of the Attorney-General, who in 1637 prosecuted him in the Star Chamber for unlawful printing and publishing of “Libellous and Seditious books.” The Star Chamber required all those before it to take an “ex officio oath” to swear to answer all question put to them, before knowing the charges. Lilburne refused to take the oath.

He based his objection on Clause 39 of Magna Carta, the “nullus liber homo” clause that states that no free man can be stripped of his liberties unless by the law of the land. He argued that a secret oath that leads to self-incrimination was illegal, and that freedom from such abusive processes was the birthright of all Englishmen, basing his arguments on earlier work by Sir Edward Coke. This led to his moniker, Free-Born John. The Star Chamber ordered him whipped and pilloried.

By his stance, Lilburne started a movement that demanded what we would now call due process or natural justice. The legal process referred to in Magna Carta required protection against self-incrimination, notice of any charges, confrontation of accusers, trial by jury (David Lammy, take note), and freedom from arbitrary imprisonment, alongside the freedom of Englishmen to publish, speak, and follow their own religious conscience. Consider the importance of these elements in the American constitution’s Bill of Rights, and you will see how important Lilburne’s stance was. The Star Chamber was abolished in 1640.

Although Lilburne revered Magna Carta to the extent that he would carry around a copy and read it out to any unfortunate guard sent to detain him, he did not rely on the Great Charter alone. Increasingly as the years went on, he appealed to both historic law and custom and to what we would now call natural law or natural rights. Having been scarred by Charles I, Lilburne took up arms against him and drafted England’s first written constitutional proposal, the Agreement of the People, which went through several versions during the Civil War. But having vanquished the arbitrary government of Charles, he found himself subject to the arbitrary government of Cromwell, who imprisoned him. In England’s Birthright Justified, he condemned arbitrary power whether “regall or parliamentary.”

Lilburne’s experience taught him an important lesson, that victory over an abusive power does not entitle its opponents to exercise the same power themselves. In today’s world where both conservatives and leftists want to use the power of the state to punish their enemies and reward their friends, Lilburne’s lesson should be heard more.

Yet you will notice something missing from this. At no point did Lilburne call for the abolition of property rights or redistribution of wealth. Yes, the Levellers opposed inherited privilege and called for equal political status in their Agreement and the Putney Debates, but Lilburne and other prominent Levellers explicitly defended their movement against the accusation that it stood for expropriation. Indeed, they claimed that they were unjustly styled Levellers.

To be fair, Lilburne did not have a modern sense of property rights, but he explicitly defended every person’s right securely to enjoy what was his own, including his rights, and denied that government possessed authority to equalise estates. He and his comrades opposed monopolies, privileged corporations, arbitrary taxation, and politically-conferred advantage (or cronyism, as we might call it today.)

The reason why Levellers’ Day celebrates a proto-Marxist version of Leveller thought is a conflation between the movement of Lilburne, Overton, and Rainsborough, and the movement known as the Diggers, or “True Levellers,” led by Gerald Winstanley, who really did believe in the expropriation of property and the redistribution of wealth, and who were crushed by Cromwell just as much as Free-Born John and his colleagues.

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Yet we owe the trade unionists, and particularly the Workers Educational Association of Oxford, a great debt. When no-one else was preserving the memory of Lilburne and his colleagues, they did. But Lilburne belongs neither to socialism nor to any political party. He belongs to the history of liberty. His simple demand was that every Englishman, however mean his condition, should stand equally shielded by the protection of the law, free from the arbitrary decisions of those in power. In the history of English freedom, few names should be celebrated more than that of Free-Born John.

The day after the Banksy statue appeared on Waterloo Place, I gave a talk to a delegation of American students visiting the IEA, who had heard about this statue, and for some reason (my talk was about something completely unrelated), wanted to know what my take on it was.

At first, I struggled a bit to explain it. What exactly is wrong with that statue? Why would a classical liberal like me object to it?

The statue shows a man blinded by a flag walking over the edge of a cliff, which is quite clearly meant to be a critique of fanatical nationalism. Fanatical nationalism is a collectivist ideology, which any liberal individualist would naturally oppose. So, again, what’s wrong with the Banksy statue? Banksy may have the tedious, trendy opinions of the cultural establishment, but that doesn’t mean that he can never be right. Isn’t the message embodied in this statue a message liberals should applaud?

In the end, I explained my take like this:

A critique of nationalism is valuable if you live in a nationalistic society. If this statue had popped up in 1914, it would have been a brilliant piece of art. But contemporary Britain is not a nationalistic society. Contemporary Britain is a society where nationalism is considered low-status and ‘cringe’, and where a performative anti-patriotism is fashionable. This is the country of Nish Kumar, Bob Vylan and James Felton, the country where, until quite recently, all the bookshops were full of fashionable BLM slop, and where it is controversial to say that the country’s wealth was not built on colonialist extraction. Against this backdrop, the Banksy statue serves no useful role. This is merely the cultural elite highlighting its own elite status. It is not “challenging” or “thought-provoking”, it is pure gloating and self-congratulation.

Whether you think a cultural or political message is useful or not does not just depend on whether or not you agree with it. If Banksy’s message is ‘fanatical nationalism is bad’, then I agree with that message. I also think it is a perfectly useless point to make in 2026.

I wonder why there aren’t more people of the centre-left who feel similarly about critiques of ‘neoliberalism’.

There’s a whole genre of books and articles that bash ‘market fundamentalism’, ‘neoliberal dogma’ and ‘trickle-down economics’. I obviously disagree with 99% of what the people who make those arguments are saying, but that is not what this article is about. In a previous life, I used to be a social democrat, and there has to be a parallel universe where there’s an alternative version of me who still is. Maybe he works for the Resolution Foundation. That alternative me would agree with a lot of the criticisms of neoliberalism. He would also think that neoliberalism-bashing is a perfectly useless genre in this day and age.

He would argue that critiques of neoliberalism were useful in the 1990s. The pendulum had swung too far in a pro-market direction. (Again, this is ‘alternative me’, not the actual me, speaking.) Capitalism was triumphant everywhere, coming even to Eastern Europe, China and Vietnam. In the West, a Thatcherite-Reaganite Anglo-Saxon capitalism was on the front foot, and European Social Democracy was in retreat. Globalisation was only accelerating those tendencies.

But he would also argue that we no longer live in that world today. Look at any polling on economic policy issues: there is barely an anti-capitalist policy, from nationalisation to price controls to wealth taxes, that does not enjoy the support of at least two thirds of the population. If governments were elected on that basis alone, Britain would be run by Zack Polanski, Zarah Sultana and Jeremy Corbyn. The book stores are full of anti-capitalist slop, and posting anti-capitalist slop on social media rarely fails to attract thousands and thousands of likes and retweets. The most high-profile economist of our time is Mariana Mazzucato, the most high-profile political influencer of our time is Hasan Piker.

In a world like this - do we really need yet another book or article on why neoliberalism is bad? I think that even if I were more sympathetic to the points being made in such books and articles, my answer would still be an emphatic no. If you’re a critic of neoliberalism - you’ve already won! Give it a rest!

Social democratic alternative me would argue that, yes, it is possible to have a naïve faith in markets - but in practice, hardly anyone does these days, except maybe for the five nerds from the libertarian student society. An infinitely bigger risk is that we underappreciate the benefits of markets, and harm ourselves by adopting some anti-market populist slop.

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You don’t need to be a neoliberal to see that markets do have some benefits, which both majority opinion and elite opinion appear largely oblivious to. You don’t need to be a neoliberal to see the benefits of the price mechanism, of competition, or of supply-side responses to scarcity. If you do, that makes you more pro-market than the majority of the population, and of Britain’s cultural establishment. I’d worry more about that than about Britain’s twelve remaining neoliberals.

President Javier Milei’s reform program in Argentina is not protected by institutions that can truly tie the hands of the next government. Rather, they depend on Milei’s party, La Libertad Avanza (LLA), and its continued hold on power.

Most of Milei’s reforms are reversible at a low political cost because, in Argentina, institutional restrictions are usually de iure, not de facto. There is also a self-inflicted fragility: Milei has governed largely by decree and has disregarded proper legislative procedures, showing the political system that this is a legitimate channel. A future government under current rival Axel Kicillof, the governor of Buenos Aires Province and a leading Peronist politician, could use the same methods to reverse Milei’s free-market reforms.

Dollarisation, which Milei campaigned for in 2023 but has not implemented, matters in this context. Not because it would be a stronger de facto restriction on future governments than others, but because it would work regardless of whether a future government wants to respect it or not.

With 18 months left in Milei’s term as president, neither law nor social consensus guarantee that LLA’s reforms will last. Polls suggest that the results of the 2027 election, when Milei will face off against Kicillof, are up in the air. The Milei government itself acknowledges this scenario when it warns about the “Kirchnerist risk” that Kicillof poses.

In the meantime, financial markets are not valuing Milei’s current economic program, but rather the probability of that program surviving a potential change of government.

In last October’s midterm parliamentary election, Milei’s LLA party obtained nearly 41 per cent of the vote compared to the Peronists’ 31 per cent. According to a hasty interpretation, the positive market reaction validated Milei’s course and ended all electoral uncertainty. But this was not the case. The October 2025 election determined seats in parliament, not the continuity of Milei’s economic program. Besides, the result came only weeks after a resounding defeat in the province of Buenos Aires in September, when the Peronists beat LLA by 13 percentage points. Milei and his party also enjoyed the explicit support of the U.S. Treasury, which backed the government politically and financially—through a USD $20 billion currency swap line—in the campaign’s final stretch.

The relevant question for investors looking at Argentina is not whether Milei won in 2025, but who will be in power in December 2027. That question remains unanswered.

A counterintuitive point is also worth considering: if the Argentine electorate, after supporting left-wing populism for nearly two decades, was able to “convert” in only two years and support a libertarian program of shock adjustment, there is no reason to assume that this conversion is permanent. A rapid shift in preferences can, by definition, be reversed just as quickly. The same, volatile opinion poll movement that allowed Milei to win in 2023 and consolidate his power in 2025 could lead to his defeat in 2027. Public sentiment is not a permanently acquired asset. Treating it as such is a fundamental error. So is equating the macroeconomic stabilisation achieved thus far with a consolidated institutional reform.

What part of Milei’s program is at risk if Peronism wins in 2027? Virtually everything.

All changes implemented by decree or administrative resolution can be reversed in the same way. Tax withholdings, deregulation by Emergency Decree, and any other measure within the Executive Branch’s discretion fall into this category. A Kicillof government does not need Congress to reinstate exchange controls, for instance: it would only require a signature to do so.

Other changes that Milei brought about do require Congressional approval to be overturned, such as the labour reform and various spending cuts. But, with a strong Peronist presence in Congress, these reversals can be implemented as swiftly as LLA’s own reforms.

Also, since the budget is the prerogative of Congress, there could be new fiscal deficits if the next government does not prioritize balanced budgets. Argentine history shows that there is a low political cost to reversing these types of fiscal reforms.

Beyond the good intentions of Milei’s new Central Bank Charter, the Central Bank’s independence does not depend on the charter either. As is the case with the other reforms, this is reversible: in Argentina, institutional restrictions may exist on paper, but are not binding in practice. There is no culture of compliance. Nor does violating such restrictions involve a high political cost.

A Central Bank that is “independent” according to the law remains, in reality, only as independent as the current Executive Branch wants it to be. It is not the case that LLA’s recent reforms lack a law to protect them. Rather, the problem is that, in Argentina, laws alone have rarely been a real institutional protection. What makes a reform irreversible is not the legal text itself. Instead, it becomes irreversible only if its undoing is more costly in political terms than leaving the reform in place. That cost depends on the precedents of compliance, not on articles of law.

Much of LLA’s reform program is reversible and its reversal has a low institutional cost. In Argentina, the continuity of any reform ultimately depends on the government’s political will, because there is no institutional constraint that truly can tie the government’s hands.

Institutionally, constructing a de facto restriction through conventional means—a law, a charter, a regulatory commitment—is extremely difficult: there is no established custom of compliance to sustain it. An Executive branch with the political will to do so can circumvent it.

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Dollarisation is different because it does not depend on compliance with a law. It is not a stronger de facto restriction than the others. Insofar as it removes local monetary power altogether, it is, perhaps, the only restriction available that does not require the next government’s compliance to function.

Britain has accidentally ended up with the kind of fragmented political landscape we would once have associated with proportional representation systems. This should, in one sense, make Andy Burnham’s life easier: at least, it gives him plenty of opponents on different sides that he can define himself against.

With that in mind, it seems like an odd choice that Burnham chose to define himself instead against an indirect predecessor who became Prime Minister 47 years before him, when he was still in primary school. Imagine having to explain this to a foreign visitor. Or imagine a French Prime Minister taking office declaring their intention to dismantle the legacy of Jacques Chirac, a German Chancellor taking office declaring their intention to dismantle the legacy of Helmut Kohl, or a Spanish Prime Minister taking office declaring their intention to dismantle the legacy of Felipe González.

But while it would be hard to explain this to an uninitiated visitor, it would make perfect sense to an observer who is familiar with British social media, where posting a statement like “I still hate Thatcher” rarely fails to attract thousands of likes and retweets (or whatever the equivalents are called on other platforms). For large sections of the British Left, Thatcher was not simply a Prime Minister whose policies they disliked, in the way a French Leftist may have disliked the policies of Jacques Chirac, or a German Leftist may have disliked the policies of Helmut Kohl. To them, she was someone who completely altered the DNA of the British economy in a way which has no counterpart elsewhere (other than maybe Chile under Augusto Pinochet), and which has never been undone. They believe that we still live in a fundamentally Thatcherite economy, and that this makes Britain markedly different from other economies. So for them, pointing out how many years have passed since she left office is missing the point: it doesn’t matter whether she left office 36 years ago, 100 years ago or a 1000 years ago, as long as her legacy is still with us, she might as well still be running the country.

Is this actually true, though? Was Thatcherism really so unique, and was it really exceptionally durable?

Let’s start with the first question. If we define ‘Thatcherism’ as simply the package of policies that were being pursued in Britain during the Thatcher or the combined Thatcher-Major years, then no, Thatcherism was not unique. With differences in degree and composition, we can see similar policy trends in many other places.

Take Thatcher’s flagship privatisation programme. Britain got there earlier than most, but just a few years after Thatcher left office, the retreat of the state from its role as an active player in the economy became an OECD-wide trend. As the OECD points out:

“[B]y the middle of 1990s, privatisation had gained momentum in most OECD Member countries. In Europe activity accelerated, especially among those who had joined the Economic and Monetary Union (EMU), as they embarked on an ambitious economic reform programme in order to meet the requirements of the convergence criteria of the Maastricht Treaty. […] During this period OECD privatisation proceeds in each year averaged around 0.3 percent of the GDP.”

One would not normally associate France, Belgium, Sweden, Finland or Italy with ‘neoliberal fundamentalism’, but even these countries sold off a lot of their state-owned enterprises in the 1990s. In France, much of that happened under the left-wing government of Lionel Jospin.

The curtailing of the growth in government expenditure, the cutting back of industry subsidies, stricter control of the money supply, the trend towards a broader tax base with fewer exemptions and lower marginal rates – none of these policy trends were unique to Britain.

Note, I am not saying that the radicalism of the Thatcher government is overstated, and that they were really just a normal Western European government like any other. They were not. Britain’s Economic Freedom score increased by about two points on a ten-point scale, which is rare outside of post-socialist transition economies. However, Britain also started from a position of more heavy-handed state interventionism, so if Britain liberalised more than others, this is in part because there was simply more liberalising to be done.

As a policy package, Thatcherism was not unique. We can find similar trends in plenty of other economies as well, even if Britain applied them earlier and with greater vigour than most.

As for the question of whether we still live in ‘a Thatcherite economy’ – that depends on what we mean by that. What would it mean to ‘undo Thatcher’s legacy’? If only a full reversal of the Thatcher-era reforms counts, then no, that has not happened. British Airways and BT have not been renationalised, exchange rate controls have not been brought back, secondary picketing enjoys no special legal immunity, and the coalmines have not been reopened. But this is not a sensible way to classify an economic model, because the policy issues of our time are not identical to those of the 1980s. If ‘a Thatcherite economy’ means ‘a liberal market economy’, then in that sense, there has indeed been a partial reversal. Since the early 2000s, Britain’s Economic Freedom score has fallen from around 8.6 out of 10 to 7.9 today. That’s not communism, but the idea that Britain is a liberal outlier in a statist Europe is completely wrong.

Thatcherism was neither unique, nor was it, in a broader sense, particularly entrenched and long-lasting. So where do people get this idea from?

What made Thatcherism special, both compared to political trends in other countries at the time and compared to British politics since then, was that it was a much more self-conscious, self-aware ideological project. To give just one indication of this, an unusually large number of Thatcher-era politicians wrote political memoirs later, explaining what they were trying to achieve while in government. I somehow doubt that either Keir Starmer or Rishi Sunak will ever do that.

The Thatcherites were unusually open and vocal about what they were doing. Lionel Jospin, the former French Prime Minister, may have sold off state-owned enterprises as well, but the last thing he would have done is extol the virtues of privatisation. He would just do it, and be quiet about it.

In political folk memory, governments with a clear ideological orientation that we can easily name and describe loom larger than governments without such an orientation. It is not the case that there have been no meaningful policy changes since Thatcher, and that everything since then has just been ‘tinkering’. But the policy changes that have happened since then have not been part of an easily identifiable, overarching ideological project. We therefore notice them less, and overstate the extent of continuity since the last government which had such a project. And that was the Thatcher government.

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The break from Thatcherism has already happened. It did not start with Andy Burnham: he just articulates it. But articulation matters. If we spend the next 100 years under governments that, step by step, take us further and further away from a liberal market economy, but without ever explicitly saying that that is what they are doing, then in 100 years’ time, people will still think that they live in a Thatcherite economy. Burnham is, at last, explicitly drawing a line under that period, and makes clear that he wants present-day Britain to be something very different. What Burnham’s alternative is remains to be seen, but at least, we will be able to judge it on its own merits, rather than continue to pretend that Britain is still governed by Margaret Thatcher’s ghost.

Countries do not slide into war. They collapse into it suddenly, unexpectedly, incredulously.

“I had grown up in the optimistic belief that major wars were a thing of the past,” the philosopher Bertrand Russell recalled of the 1914—1918 cataclysm. “When I heard the news of the war, I felt as if a curtain had been torn aside and the world revealed itself as a dark and terrible place.”

Most of his contemporaries felt the same way. “One hears the word ‘war’ whispered everywhere, but no one believes it,” the Austrian novelist Stefan Zweig wrote. “It is as if the world has gone mad.”

I am becoming morosely convinced that a major global conflict is gathering head and that we will be caught as much off-guard as our ancestors were at the start of the 20th century.

Like them, we have been lulled by three generations of peace. Not total peace, obviously. Just as in their day, we expect occasional wars in Africa, the Middle East, Latin America, and sometimes, the remote parts of Europe. But, much as they had not known an all-out conflict since the end of the Napoleonic wars a century before, so we have not known one since the end of the Korean War.

Now, as in the early 20th century, we have people explaining, with apparently rock-solid logic, why wars will continue to become rarer. In 2011, Steven Pinker published The Better Angels of Our Nature, a study of why violence of every kind was in long-term decline and why taboos had grown up around the use of force. In much the same vein, in 1910, Norman Angell published The Great Illusion, arguing that a major war was no longer feasible in an economically interconnected world.

Both men were, in their own terms, completely correct. Globalization is indeed a check on bellicosity. Free trade makes waging war both less rewarding (why fight to control assets when everyone can buy them at the same price?) and more costly (the disruption to a belligerent’s economy is more severe).

But then, as now, the consensus behind unrestricted commerce and open sea lanes was coming to an end. France, Germany, Russia, and the United States all turned to protectionism in the 1890s, leaving only Britain to carry the international economic system.

We are seeing a similar swing today. More trade barriers have been erected than removed every year since 2008. The difference is that, this time, the chief defender and beneficiary of the global order, the U.S., has itself turned protectionist, and in the most aggressive way. This time, the rush to autarky has come before the conflict rather than accompanying it.

Other ingredients are in place, too. We have been slow to understand the implications of President Donald Trump’s Putinism in Ukraine, but few observers now seriously imagine that the U.S. would go to war to protect Latvia from Russia, or Taiwan from China. Every country is therefore scrambling to arm itself, including, in some cases, with nuclear weapons.

Nor is representative government the pacifying force it used to be. It was once said that no two democracies had ever gone to war, although this was not quite true. Israel and Lebanon fought a war as democracies, as did Peru and Ecuador. Still, it was undeniable that democratic regimes were less likely to mobilize against one another than dictatorships.

Which is why we should be worried that, since 2012, the number of democracies in the world has steadily dwindled, while the number of dictatorships has increased.

Just like the generation of 1914, we ignore the early warning signs because we have been so habituated to resolving our differences through negotiation. Just like them, our very complacency is the problem.

Looking back, we can see several moments when the 1914 cataclysm might have been averted. Austria could have treated the assassination of its archduke as a criminal offense rather than a political attack. Serbia could have accepted Austria’s terms. Russia could have delayed its mobilization. Germany could have held off from issuing an ultimatum. Indeed, if they had been able to see what was coming, every participating country would surely have made different choices.

But, just as today, they could not properly imagine a world in which advanced nations fought each other directly rather than through distant proxies. And so they stumbled over the precipice.

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We, too, have plenty of opportunities to step aside. But we, too, seem unable to grasp the immediacy of our peril. Throw up tariffs? Jeopardize NATO? End the dollar-based system? Stop backing democracies? Lose to the ayatollahs? Meh. What’s the worst thing that can happen?

IEA Interview: IEA Managing Editor Daniel Freeman speaks with Dr Kristian Niemietz, IEA Editorial Director, about why Britain has struggled to build almost anything for decades, from housing to lab space to supermarkets, and how this shortage of building land helps explain the country’s weak economic growth, IEA YouTube

IEA Podcast: Callum Price, Director of Communications, Dr. Christopher Snowdon, Head of Lifestyle Economics, and Dr Kristian Niemietz, IEA Editorial Director discuss youth unemployment, state-run grocery stores in New York City, and the free speech controversy involving Reform and the Green Party, IEA YouTube

This week on Economic Affairs

• Why stagnation is a choice

• New York goes shopping

• Burnham’s missed tax fix

Valentin Boboc is the Senior Economist at the Institute of Economic Affairs

The estimated £18 billion annual cost for free social care, on the NHS model, should be treated more like an opening bid. The final bill for the taxpayer will likely be much higher.

Whilst we don’t have enough details to judge the current proposals for social care, we should be very sceptical of early price tags mentioned in the media. These figures ignore the rising demand from unpaid family carers who will inevitably shift some responsibility to the state, and without whom meeting that demand will be impossible.

They ignore the fact that one of the main elements of cost – human labour – is rising faster than the general price level. And, most importantly, they fail to account for the growing size of the elderly population, which will inevitably push costs ever higher.

We should have grown accustomed by now to the fact that the government has a poor record of forecasting costs. HS2 was once estimated at a fraction of its current £100 billion price tag. The additional cost of the pension triple lock rose from £5.2 billion to £15.5 billion within 15 years, as a result of the double whammy of inflation and earnings swings.

Promising open-ended entitlements could quite easily spiral out of control even faster. Governments create entitlements easily and struggle to reduce or withdraw them later. Once social care is ‘free,’ no chancellor will dare charge for it again. We will likely end up with a situation where social care must be rationed through non-market means, such as bureaucratic decisions and waiting lists.

Free care, as the taxpayer keeps discovering, is the most expensive kind.

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IEA Podcast: Managing Editor Daniel Freeman is joined by Editorial Director Kristian Niemietz and Head of Lifestyle Economics Christopher Snowdon to discuss Mamdani's state-run grocery stores, Burnham's vocational schools plan, and the Farage guillotine T-shirt row, IEA YouTube

This week on Economic Affairs

News and Views from the IEA

Buildings: In defence of stupid growth

• Britain is barely richer per person today than it was in 2007 — nearly two lost decades of stagnation

• Britain’s Housing Affordability Ratio stands at 7.6, and tops 10 in Oxford, Cambridge, Bath, Brighton and London

• England is short by 3.4 million homes to match the EU average, and by nearly 9 million to match France

• Only around one tenth of England is developed; the green belt alone covers almost 13% of its land

• New publication from the IEA by Editorial Director Kristian Niemietz lays out how planning restrictions have driven Britain’s Great Stagnation

Read the Report

Mamdani’s socialist grocery stunt won’t help poor New Yorkers. Kristian Niemietz’s analysis of New York Mayor Zohran Mamdani’s plan to open five city-owned grocery stores in City AM.

Mamdani has pledged one state-owned grocery store per borough, offering 30 per cent discounts on produce, meat, bread and milk once they open next year, a saving he claims could be worth around $1,000 a year per household. But the IEA’s Kristian Niemietz argues the scheme is less an economic policy than a communication device, one that reinforces the ‘greedflation’ narrative blaming inflation on corporate profiteering.

The discounts will be funded through subsidised rents and tax exemptions, meaning the benefit isn’t really free. An IEA poll found the average person believes retail profit margins sit around 50 per cent, when the true figure is two to four per cent, so even if every retailer gave up its profits entirely, shopping bills would barely move.

Dr Kristian Niemietz, Editorial Director and Head of Political Economy at the IEA, said: “What they gain in their role as grocery shoppers, they will lose in their role as taxpayers.”

Why Can't Britain Build Anything, Anywhere? Daniel Freeman interviews Kristian Niemietz on his IEA briefing on Britain's self-inflicted housing shortage, IEA YouTube

Kristian Niemietz debunks Gary Stevenson’s wealth tax on spiked:

Daniel Freeman says Andy Burnham missed his chance to fix Britain’s worst tax

Stamp Duty reform was shelved this week, but Daniel argues it’s the one tax that experts across the political spectrum agree should go.

“Stamp Duty is so bad that abolishing it is one of the few issues you will get tax experts on the left, right and centre, to agree on.”

“There is actually a broad degree of consensus among economists that well-designed property taxes are less economically harmful per pound raised than taxes on income, corporate profits or consumption.”

Like many people, I spent holidays as a teenager and a student working in flexible low-paid jobs. They weren’t glamorous and didn’t offer much security, but they allowed me to make my own money and, more crucially, they gave me a way into the labour market as someone without any experience or skills.

As Sir Keir Starmer leaves office, the Employment Rights Act, passed on 18^th December 2025, is being touted as one of his legacy achievements. Yet, while the Act has been deceptively framed by Labour as giving workers more ‘rights’, what it has really done is hurt the people it claims to help.

The intention of the Employment Rights Act may have been to protect workers, yet the unintended consequence of it will prevent many young people from gaining crucial work experience. Burdensome regulations, such as day one paternity leave, ordinary parental leave, and statutory sick pay might on the face of it look beneficial to workers, but not if they make employers more adverse to hiring new workers, especially young people without previous work experience. Young people who are either working flexible hours or looking for a permanent job don’t want mandated employment benefits if it means we won’t be hired in the first place.

Other regulations, such as workers being given the right to sue their employer for unfair dismissal after 6 months on the job – reduced from 2 years – will only create a more legalistic market, where employers spend more time managing legal risk than creating employment opportunities.

One benefit of having a free labour market is that it allows young and inexperienced workers the chance to gain experience and skills. If the cost of hiring increases because of new employment rights, then it will be the youngest and least essential workers that will be laid off, or employers will simply hire less people.

Evidence shows that this is already a major problem. According to the government’s own data, from February to April 2026 there were 735,000 young people aged 16 to 24 who were unemployed, 109,000 more than the previous year. Additionally, from January to March 2026, there were 1.01 million people aged 16 to 24 who were not in employment, education, or training (NEET), 13.5 per cent of all 16-to-24-year-olds. This was the first time that the number of NEETs has exceeded 1 million since 2013.

There are likely a number of causes which are to blame for this, including a skills and education mismatch, minimum wage hikes, increased payroll taxes, and employment regulations. The Employment Rights Act 2025 is too recent to be the cause of increased youth worklessness. But it will likely make the problem a whole lot worse.

Once relatively free, Britain’s labour market has gradually become more regulated over decades. The original Employment Rights Act in 1996 was followed by the National Minimum Wage Act 1998, Working Time Regulations (implemented from EU law), the Employment Act 2002, and the Agency Workers Regulations, all of which piled billions of costs onto businesses, which are then passed onto workers through smaller pay rises.

Another part of the Employment Rights Act, the ‘right to request’ flexible working hours, might sound liberating for workers, but by enforcing a one-size-fits-all mandate, the government could end up passing business costs onto the workers themselves through slower wage growth. With workers unable opt-out of these employment protections, they will effectively function as a ‘stealth payroll tax.’

Another unfortunate cost of employment regulations is that they make the UK less internationally competitive, driving away investment and jobs. If Britain is a less attractive place for investment, then fewer companies will expand, fewer entry-level roles will be created, and fewer training opportunities will exist.

Those in favour of stronger worker protections argue that workers do not always have equal bargaining power and are not genuinely free as a result. But for young people, just having the opportunity to work is more important than having secure employment. While experienced and highly skilled workers might benefit from stronger protections, younger and less experienced workers risk being excluded from the labour market altogether.

The Labour Party might think that it has won the argument on workers’ rights, but the evidence shows that it doesn’t have to be this way. The US has a much more flexible labour market than Britain. One advantage is that employers are more willing to hire. This might explain why youth unemployment in the US is 9.2 per cent, compared to 16.2 per cent in the UK. Spain, where youth unemployment sits at 23.5 per cent, demonstrates how overregulating the labour market can harm younger workers by discouraging firms from creating permanent jobs.

Britain’s overregulated labour market is creating a lost generation of young people who have lost confidence in their future opportunities. Rather than burdening businesses with even more employment regulations, a solution to increasing youth worklessness would be to cut the red tape and make hiring cheaper. Businesses want to hire more workers, but the state needs to get out of the way.

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The main reason that this doesn’t happen is firstly because the Labour Party refuses to accept that its policies are economically damaging. If it finally realised that many of the problems facing the economy, such as youth unemployment, are a result of overregulation, then it would have to change course. But it doesn’t do so because that would require giving up their raison d’être, which is representing the interests of trade unions.

Christopher Nolan has built a remarkable career by using blockbuster cinema to explore profound philosophical and historical questions. His latest film, The Odyssey, continues that tradition. Yet this time, beneath the sweeping visuals and epic storytelling, lies an unexpected argument—one with striking relevance for today’s debates about globalisation, trade, and international cooperation.

The film’s most memorable moment is not the fall of Troy, the encounter with Polyphemus, or the song of the Sirens. Instead, it comes when Odysseus, after two decades of war and wandering, reflects on the civilisation that existed before the conflict. He remembers “a world of palaces, trade and writing,” held together by “bonds of trust” that were ultimately destroyed by violence. Those words are not found in Homer’s original text. They are Nolan’s own addition, transforming an ancient epic into a meditation on one of history’s most enduring questions: why do civilisations flourish, and what causes them to collapse?

That question lies at the heart of Johan Norberg’s recent book Peak Human, which argues that societies rise not simply because of military strength or exceptional rulers, but because they develop the institutions that make cooperation, innovation, and voluntary exchange possible. Historians once explained the fate of civilisations primarily through battles, conquests, and empires. Increasingly, however, scholarship has shifted its attention towards less dramatic but ultimately more decisive forces: secure property rights, political stability, trust between strangers, economic freedom, and the peaceful exchange of goods and ideas. Armies may conquer kingdoms, but commerce is what allows civilisations to endure.

Nolan’s emphasis on trade is therefore far from accidental. Archaeology has revealed that the eastern Mediterranean during the Late Bronze Age was home to one of the most sophisticated commercial systems the world had yet seen. Rather than a collection of isolated kingdoms, it formed a remarkably integrated economic network linking Egypt, Anatolia, the Levant, Cyprus, mainland Greece, and beyond. Copper, tin, wine, olive oil, timber, textiles, ivory, glass, spices, and precious metals travelled enormous distances through interconnected markets.

The most remarkable evidence for this commercial world emerged almost by accident in 1982, when a diver discovered the wreck of a merchant ship off the southern coast of modern-day Turkey. The Uluburun shipwreck, dating from the fourteenth century BC, contained more than ten tonnes of Cypriot copper, almost a tonne of tin, African ivory, Baltic amber, Mesopotamian glass, Mycenaean pottery, and gold jewellery. No primitive economy could have organised such a logistical operation. Long before the Industrial Revolution, an extensive international trading system already connected societies separated by thousands of kilometres.

Commerce alone, however, was not enough. These networks depended upon institutions of cooperation. The Amarna Letters reveal rulers addressing one another as “brothers,” exchanging gifts, negotiating alliances, and maintaining permanent diplomatic contacts. Greek society reflected the same logic through xenia—the sacred obligation to offer hospitality to strangers. In a world where long-distance trade depended on trust between people who had never met, such norms were not merely moral ideals; they were essential economic institutions.

Seen in this light, Nolan’s The Odyssey becomes more than an adaptation of Homer. It offers a powerful illustration of what classical liberal thinkers have argued for centuries: war destroys far more than cities. It undermines trust, disrupts commerce, and replaces voluntary cooperation with coercion. David Ricardo demonstrated why trade benefits all participants through comparative advantage, while Frédéric Bastiat captured its political significance in his famous maxim: “When goods do not cross borders, soldiers will.” Modern research broadly supports the intuition. Political scientists John Oneal and Bruce Russett have consistently found that countries with stronger commercial ties are, on average, less likely to fight one another. Trade does not eliminate conflict, but it changes incentives by increasing the costs of war.

The historical record points in the same direction. Since the Second World War, international trade has expanded at an unprecedented pace. Over the same period, extreme poverty has fallen dramatically, life expectancy has risen across the globe, and—despite many tragic exceptions—the world has experienced the longest period without direct war between the major powers in modern history. As Steven Pinker argues in The Better Angels of Our Nature, the long-term decline of violence reflects many factors, but the spread of commerce, stronger institutions, and wider networks of cooperation has undoubtedly been one of them.

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Nolan’s film also offers an important reminder. Prosperity is not a permanent condition. Markets do not sustain themselves automatically. They depend upon trust, stable institutions, enforceable contracts, and the rule of law. When those foundations begin to crumble, commercial networks can disappear with astonishing speed—as they did more than three thousand years ago. That may be the deepest lesson of Nolan’s The Odyssey: civilisation is not held together by military power alone, but by a fragile web of trust and voluntary exchange that must constantly be preserved. In reminding us of that timeless truth, Nolan has done something increasingly rare: he has turned a Hollywood blockbuster into a compelling defence of the institutions that underpin peace, prosperity, and human flourishing.

For a young aspirant with dreams of the front bench, the decision of what to read at which university commanded one simple answer - PPE at Oxford. But “Modern Greats” has produced, of late, rather few of the sort. Even those reading the megalomaniacal mish-mash are now wincing at the endless questions about their yearning for positions much degraded in public esteem.  

But now it’s English’s turn to screw its courage to the sticking place - and it might not fail. Burnham, at Cambridge, was trained on Leavis and his fear of a “technologico-Benthamite civilisation”. So, we await a premier awash with kindness, empathy, and fellow-feeling - the skills that, ostensibly, make an English degree worth it.

If literature makes you kinder, it’s no wonder that it should produce a poster boy of the left. It has become a well-worn adage and a stock critique of the right - sensitive young people are contorted in the woke factories of humanities departments. English, however, had surprisingly conservative beginnings. Its establishment as a subject worth studying came from the Newbolt Report of 1921, which set literature as a new-age alternative to religion in the fight against vagrancy and anarchy. English, then, from its birth, has been an instrument of ideology. And leftism marched in a half-century later, riding on the high that literature is a site of ideology and power (as opposed to something to muse upon, heartbroken, by a river), and henceforth, literary criticism donned the purple robes of ideology critique. The strident schools of literary criticism were overtly named “Marxist”, “postcolonial”, “feminist”.

As I trudge my way through my Classics and English degree (two disciplines that were anathema to each other a century ago, with the former inveterate and the latter arriviste), I am continually baffled at the discipline’s fetishisation of dismantling. The correct ideology must be the dismantling one. We have put Rhodes in a cage - we may now put Wuthering Heights in one too.

But there is no mandate that literature should churn out willing customers of natural wine bars. And neither is it a necessity that the “kindness” literature engenders should incubate politicians of the left. The discipline prides itself that it holds no “right answer”. But the range of answers that emerge is much narrower than one might expect. In the potential of what English can teach, even if that demonstrably is, admittedly, quite woke, we can find a nuance of thought that could easily hone its strength in public life. And - I promise - producing a politician of free-market bent is clearly within its scope.

An education in English affords a remarkable freedom to its students. Periods and papers are loosely programmatic, but you are free to engage with anything, however lowly, that could be classed as “literature” within them. Single-honours English at Oxford forces you to do Old English, but Burnham’s Cambridge does not even impose this. I find myself reading everything from 18th century political pamphlets to gaudy 1930s novellas. The syllabus leaves ample room for self-actualisation… or mere indulgence of your own tastes. The enjoyment of this freedom, I believe, has given its students the materials to turn up their noses at oppressive top-down bureaucracy.

And good reading attunes your mind to particulars; the nuanced, irreducible vagaries of lives that cannot be aptly explained by a model, but make our existence interesting. Yes, much has been made of “regular” lives, but it is in their aberrations that literature finds its realm - the regular wife who has a wild affair, or the salaryman who quits his job. Your economist ears might be firing up - this catallaxy of specific circumstances shares much with Hayek and his Knowledge Problem. The epistemology of the two converge in the damning realisation that a jobsworth with a clipboard cannot discern the inner world of man.

But we cannot, exactly, call a novel Hayekian - the very existence of a narrative is the fruit of the top-down planning of the author. A plot is no catallaxy. And the “market” can only be shown with a specific face, which is often as unappealing as an imperious mill owner or uppity landlord. I caveat: the anti-market reading is not a stupid one to reach, but it is certainly not the only one.

English students’ virtue is that they are “empathetic”, which has been lauded as a good prospect for Burnham’s premiership. He is a man who can weep along with the plight of the disadvantaged, rather than just reach for the clipboard. But “empathy” is chained to what is “seen”, in Bastiat’s terms - it fixates on the vivid particular, like the single mother fighting to make ends meet, and ignores the many things that go “unseen”, which simply cannot be written into a plot. Not even Hardy could write a compelling novel chronicling all those who didn’t lose their jobs.

The antidote to this blindness is, however, contained right within good literature: it is the wonderful device of irony, which at once holds the sufferer’s frame and the frame he lacks in view of the discerning reader, taking him beyond the deceitfulness of an image. But, crucially, this vantage does not allow the reader the omniscience of a central planner - unreliable narrators, such as Humbert in Lolita, deprive us of that privilege. That leaves the trained reader knowing that “empathy” is easily manipulated and often short-sighted - which is but one step away from suspecting the same of a policy paper.

Burnham has told us that his favourite novel is Eliot’s Middlemarch. This novel is an easy choice for a soft-left politician; Dorothea Brooke yearns to do good at scale, and the novel’s sympathy is reformist. But the novel readily permits an alternate reading. Casaubon’s Key to All Mythologies is the apotheosis and downfall of the totalising scheme, and Lydgate, who despite modelling a decent plan for the town, is destroyed by particulars: debt, a bad marriage, and irrevocably tangled local interests. Even Dorothea’s dignified ambition is gently disciplined until it finds its most effective form in familiar, rather than grand, philanthropy. The finale is marked by “unhistoric acts”, whose effect is “incalculably diffusive” by virtue of its lack of design. It would certainly not be a stretch to feel the same dignification of the spontaneous in classical liberalism or with the Austrians.

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I believe that English’s greatest strength is its infinite variety. It is a shame that a discipline that promises an infinity of interpretations has sequestered itself down one critical alley, insofar that the study of English is deemed a defining feature of a politician like Burnham. Perhaps the decades of theory piled atop finally deserves its own dismantling.

As you sit in another traffic jam, try to work your way around another road closure, follow a diversion or sit at home waiting for someone or some delivery that is late to turn up, do you ever ask if public sector roads are the best answer? How much of our lost productivity and squeezed small business sector is down to the costs and difficulties of getting about?

In my first roads article I looked at the stressed and delay prone nationalised strategic highways, our motorways and trunk roads, which cater for a third of our vehicle miles and two thirds of the truck miles on an inadequate 2.4 per cent of our roads. My second promised article got delayed a week by a Burnham diversion and yet more government anti-driver actions. Today I look at that cross roads of congestion, our major road network of A roads. These are nationalised under local authority management but often dependent on national government grants. A further 43 per cent of our vehicle miles take place on these routes on just 4 per cent of our roads. The remaining 93 per cent of our roads are local and handle only 23 per cent of total travelled miles.

The major Council A road network is crucial to productivity and jobs in the UK. It is the main means for people to get to work, the main way to get to shops, for service companies and deliveries to reach our homes and for children to get to school. It is sadly neglected by government, starved of cash for extension and improvement whilst millions more people in recent years come to live here needing vehicles and deliveries. Over 20 years only 600 miles of new road has been added to the major road network. Much more new road has been added by developers as they build new housing estates with plenty of local and estate roads to funnel more vehicles onto the overwhelmed major road system.

There are very few new road schemes planned for the A roads to improve capacity and reach with only a small national budget of £1.6 bn. Government’s priority is to cut vehicle use, so plenty of money is spent on anti-vehicle changes to roads. Active travel’s new third strategy is backed by £4.5 bn to get 55 per cent of all short journeys in towns and cities onto bikes or on foot. The government in its usual way has a popular success story of personal transport on its hands, so it does its best to throttle it. It turns to rationing and to offering very expensive less popular choices buttressed by public spending, tax breaks and over provision. We have plenty of near empty trains apart from some peak times and favoured routes, and many unused cycleways.

As a result we face an increasing array of measures to slow, impede or stop road vehicle use. There are the 20 mph zones taking over urban areas. 20 mph is fine near a school at times when children may be in the road, or on residential estate roads, but not on a major A road route needed for heavy traffic. There are a growing number of Low Traffic Neighbourhoods restricting access to and from residential areas altogether. There are chicanes and speed humps. On some roads now Councils have put islands or barriers on one side forcing traffic to stop and wait for a gap in traffic coming the other way, a particularly dangerous as well as vexatious intervention. Many new traffic light sets are introduced. Vehicle lanes are reduced or narrowed to put in bigger pavements and cycleways. Aggressive kerbs are popular to do more damage alongside the poor road surface so motorists sometimes swerving to avoid the potholes hit a new super kerb. Tyres and suspensions are hammered by bad roads.

Junction design is often changed to slow and delay traffic. Light phasings sometimes ignore the need to give priority to the main road. Too few light sets have traffic sensors to trigger timely changes of light phasing in accord with traffic demand. Drivers on the main road have to wait at red lights when little or nothing is using the green. Some light sets now have all red phases to allow the mythical pedestrian wanting to cross both roads at the same time to do so. There are too few roundabouts which usually flow better. Some highways Authorities seek to cut flows at successful roundabouts by narrowing the highway or by introducing traffic lights and stop lines.

So why are our main local roads so badly run? Some of the changes are made as so called green policies, yet they lead to more congestion and vehicles burning more fuel whilst making little or no progress. Some are made to improve safety, yet they often increase potential conflicts between vehicles , cycles and pedestrians by complex junctions, narrower lanes, and confusing instructions.Taking roadspace away from vehicles to create a little used cycle lane causes congestion and frustration, which some bad cyclists add to by riding on pavements or the vehicle lane and shooting red lights in unpredictable ways.

Good Councils should get to work to help drivers who pay so much tax for such a poor service. They should roll out traffic management schemes that improve flows. We need more roundabouts and fewer light sets. All A road traffic lights should give priority to the main road with traffic sensors to allow entry from side roads in a controlled way. They should pursue more small schemes to remove road blockages, allow selective widening and segregate A road vehicle traffic from bikes and pedestrians. They should not have 20 mph speed restrictions.

Each Council or Mayoralty should set out a local strategic road network of the main through A roads in their areas. There should be plans to dual heavily trafficked routes. The national government needs to provide a better financial balance between good roads for vehicles and good active travel alternatives away from the main strategic roads.

White van man and woman need a better deal. To save our High Streets we need decent car access. To have more choice of services and deliveries to our homes we need better roads.

Anyone wanting to grow this economy should want lower taxes and cheaper energy. They need to follow that up with better main roads as highways for trade, services and getting to work. We lose both productivity and business opportunity by sitting in traffic jams. Drivers pay far more in vehicle and fuel taxes than they get in road provision. The plumber, the Amazon delivery driver, the builder, the employees going to work and the families seeking entertainment all need to get there by road vehicle. Why does the miserable government road monopolist seek to delay them and lecture them on how not to bother? It even in some places spends money on expensive signs to tell you to expect long queues and bad service, as if proud of it.

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What we’re reading

1. The unspoken truth about wildfires. Matt Ridley argues in The Spectator that, despite the awful headlines from the continent, the cumulative land area burnt in wildfires across Europe is far below the 2012-2025 average. Although politicians like to blame climate change for their failure to take precautionary measures, controlled burns are the most important factor in preventing the build-up of tinder. In Britain, government policy against controlled heather burning gets in the way of good practices.

2. Why wealth taxes fail. Over at the Cato Institute, Chris Edwards and Adam Michel write that taxes on wealth target accumulated savings such as business assets, which benefit society with investment and job creation. Most European countries that imposed wealth taxes eventually repealed them since they were counterproductive, leading to capital flight and tax avoidance. Current proposals to create wealth taxes run counter to the lessons from recent experience.

3. Mamdani’s subsidized NYC grocery stores face lawsuit: As Lisa Fickenscher reports at the New York Post, a group of business owners will sue New York City’s “democratic socialist“ mayor, Zohran Mamdani, over his taxpayer-funded supermarket scheme. The group’s spokesman says the subsidized stores, which are meant to sell groceries at steep discounts to market prices, would have an unfair advantage over their private competitors. It might amuse Mamdani that the business group suing his attempt at state-owned retail distribution is immigrant-led. It is called the Multicultural Business Coalition.

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Over the last few weeks, one of the most important jobs in Britain has become vacant. Not the one that dominated the headlines last month, nor Nigel Farage’s rage quit. This was a departure that has gone comparatively unnoticed: that of John Edwards, the Information Commissioner.

Dismissing his exit as a niche matter for Westminster insiders would be a mistake. This isn’t some random quango chief executive whose departure matters only to SW1 people-watchers. Rather, the role oversees two of the most critical functions of modern governance: taxpayers’ ability to access public records and their right to personal privacy.

This right to interrogate the civil service and elected officials is one of our few remaining safeguards outside the ballot box. Protecting the ability of the general public to question anything from the cost of putting in a new cycleway by the council to the policy documents for a government decision is how those outside Parliament hold those within to account. Crucially, Freedom of Information requests (FOIs) allow us to access information that is not already in the public domain, bridging the gap between what an authority chooses to publish and the information the public deserves to see.

The figures show why this transparency matters now more than ever. In 2025, public bodies received a record 94,526 FOI requests, a 14 per cent surge on the previous year. The complaints statistics are equally telling: of the 640 complaints escalated to the Information Commissioner’s Office (ICO) in 2024, only 369 original decisions to withhold information were upheld.

Public appetite for official scrutiny is growing, and taxpayers need robust leadership, not a passive referee.

Ironically, it took an FOI to discover the ICO has been exploring its own ways to clamp down on the flow of inquiries. The proposals ranged from five requests per year per agency, to allowing individuals to be declared vexatious over individual requests, and even requiring greater identification before accepting a request.

From individual requesters to investigative organisations, this change would only result in less accountability. This would, in turn, give ministers greater control over what can stay hidden and who can ask questions.

A pledge to “tighten up” legal response timeframes means nothing when this very group, which should be championing disclosure, also wants to refuse to investigate an FOI when there is “little public interest in its disclosure”. The body tasked with upholding information rights should not be deciding on behalf of taxpayers how far those rights should extend.

The central problem here is that the structure of the job is conflicted.

The Commissioner is expected to balance competing priorities by protecting personal privacy and enforcing data protection rules, while also ruling on FOI requests made to agencies and defending the right to access public data.

Both are important duties, but each requires different instincts. When both roles sit inside the same office, led by the same office-holder, it leads to one priority dominating the other, depending on the leadership of the day.

Having previously served as New Zealand’s Privacy Commissioner, Edwards’s pre-appointment committee hearing focused heavily on issues around big tech and accessing remedies. At the same time, he refused to commit to reinstating the strict FOI compliance monitoring standards previously used to keep foot-dragging agencies honest. Yet it is not only transparency advocates who have been left disappointed, with privacy experts also raising other concerns about the office’s direction.

This is not only a British problem. Across the Anglosphere, governments are attempting to make it harder to question them.

Australia has only temporarily paused reforms on the basis that its system costs around $100 million AUD a year while ignoring the unknown savings from promoting a culture of transparency. New Zealand is investigating restrictions of its own despite the guiding principle that official information should be released unless there is good reason to withhold it. Even Canada, where access-to-information fees have existed since 1983, continues to expand the grounds on which requests can be refused.

The UK may already proactively release more information than these countries, but the fact that four of the last eight Prime Ministers have criticised the system for stopping good government shows our leaders still don’t understand transparency. Too often those who champion transparency from opposition come to see it as an obstacle to governing, rather than a safeguard against governing badly.

If the system is truly under pressure, the answer is not to make it harder for taxpayers to ask questions, but to demand more information be proactively published and that unnecessary bureaucratic sign-off processes are stripped out. These backlogs would naturally fall away if requesters were treated less like a threat and more like a routine part of open government.

Edwards’s departure needs to be used as an opportunity for a rethink of the structure of the office itself.

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Liz Kendall, the former Science and Technology Secretary, believed that dropping the single commissioner model and appointing non-executive directors would fix the office’s cultural issues. Yet the fundamental problem will remain: a body split between two very different mandates will still struggle to produce better results.

Groups like the TaxPayers’ Alliance and New Zealand Taxpayers’ Union are not usually the first to call for more commissioners. Yet this may be a rare example where splitting the job would lead to less secrecy rather than more bureaucracy, with one agency focused on personal data and digital regulation, while a separate body would champion a stronger FOI system.

The Information Commissioner’s Office cannot continue competing with itself.

This week Wikipedia deleted a key paragraph from its entry about the origin of Covid. Why does this matter? It tells me that the real battle in this world today is not between left and right but between top-down and bottom-up. Wikipedia is a prime example of an institution that was intended to be built from the bottom up by us all and is increasingly being dictated from the top down, disastrously.

Spontaneous order describes many of the things that work best in the world: ecosystems, brains, bodies, cells, and genomes are built that way, self-assembling with no management. So are economies, markets, and languages. Nobody is in charge of the rules of the English language (thank goodness), even though it is man-made: everybody is. As the eighteenth-century Edinburgh philosopher Adam Ferguson said, “nations stumble upon establishments, which are indeed the result of human action, but not the execution of any human design”.

“On coming to Paris for a visit, I said to myself: Here are a million human beings who would all die in a few days if supplies of all sorts did not flow into this great metropolis,” wrote the nineteenth-century economist Frédéric Bastiat. Nobody is in charge of deciding how Paris gets fed every day, and it would be a mess if somebody was (see Union, Soviet or European). The lesson is that we are far too ready to reach for command and control rather than, as far as possible, setting the rules so that people can negotiate complex solutions among themselves through the magic of supply and demand.

The paragraph deleted from Wikipedia this week described a document called the DEFUSE proposal. This was a grant application from scientists in Wuhan and America in 2018, which requested $14 million from the Pentagon to put a genetic sequence called a furin cleavage site into a virus 20 per cent different from SARS for the first time. A year and a half later, a virus 20 per cent different from SARS with a furin cleavage site – the only one ever found in several hundred sarbecoviruses – started infecting people with a nasty new disease called Covid, in the very same city where they had proposed to do the experiment.

This week some Wikipedia editor called “SilkTork” called the DEFUSE proposal an “unnecessary detail” and, minutes later, another editor called “Tarnished Path” removed all mention of it. He left in a verbose and bizarre paragraph about the “parallel between the Wuhan lab leak narrative, and the machinations of fictional supervillain Fu Manchu”, giving the lie to the claim that the cut was made to save words – and perhaps giving a clue as to his own nationality.

This is the reality of Wikipedia these days. A handful of powerful editors decide what you will read. They have banned 1.6 million people from contributing and spend their days shutting down anything that does not fit their prejudices. As Wikipedia’s co-founder Larry Sanger complained last year: “It is a basic principle of sound governance that we know who our leaders are, so why are the 62 Wikipedia users with the most authority—’CheckUsers’, ‘Bureaucrats’ and Arbitration Committee members—mostly anonymous? Only 14.5 per cent of such users reveal a full, real name.”

This matters because Wikipedia is the overwhelming favourite source for Google when it comes to searches, and of almost all the AI engines too. Google has been pouring money into the Wikimedia Foundation, whose boss, Katherine Maher, has said that empirical truth-seeking is a “white male Western construct”. Wikipedia was built on the principle of decentralised knowledge but, says the journalist Ashley Rindsberg, has veered into “the hyper-centralized space of top-down social justice activism and advocacy”.

It is not the left-wingery of Wikipedia that bothers me but the top-downery. We have just invented a forum called the internet where everybody and anybody can contribute. But the instinct of pretty well every politician and far too many journalists is to try to turn it into a place where nanny knows best.

Surely it was not a coincidence that this edit happened two days before Anthony Fauci appeared before a Senate committee, where he was asked to explain why he secretly thought a lab leak possible but publicly did his best to kill the idea. The DEFUSE proposal is the single most devastating document pointing to a lab leak.

We now know the pandemic probably had a top-down cause, not a bottom-up one: a Chinese research group with American backing decided that interfering in viruses – collecting them from bats, bringing them to the middle of a big city, sequencing and then altering their genomes, testing them on humanised mice – would prevent a pandemic. Instead it almost certainly caused one. For some reason, scientists who are happy to embrace the idea that climate change has a top-down cause are extremely reluctant to reach the same conclusion about Covid.

Then the response to the pandemic was also far too top-down: locking us down for months on the basis of flawed models, culminating in our government telling us whether a Scotch egg is a snack or a meal.

Conversely, we know that the Chinese economic miracle had a bottom-up cause, not a top-down one. It was not some brilliant piece of planning by the government. It was the accidental realisation by Deng Xiaoping that a bunch of farmers disobeying their collective farm rules and growing their own produce were getting results, followed by a decision to loosen the restrictions on other sectors too.

This is true of all economic miracles. When Bill Clinton asked Congress to allow e-commerce, he did not try to dictate what would happen: the Framework for Global Electronic Commerce he put forward in 1997 was one of the most libertarian documents in history. The rapid rise in living standards in countries like India, Vietnam, and Poland is not the result of good five-year plans but of government getting out of the way of entrepreneurs.

When Ludwig Erhard decided to abolish price controls and rationing over one weekend in post-war West Germany in June 1948, the head of the American occupying forces, General Lucius Clay, was horrified. He told Erhard: “My people say you are thinking of abolishing controls, and they think that’s a bad idea.” Erhard replied: “Yes, my people say it’s a bad idea too, but try and stop me.” Germany took off like a rocket after that.

This is not an argument for anarchy. Of course we need law and order. But it is an argument for humility. Don’t assume that a few clever people know best; don’t tell other people how to flourish; set the rules, hold the ring, be the referee, but let the players play the game.

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What we’re reading

1. Turning Japanese. Over at CityAM, Helen Thomas suggests that Britain faces a choice like the one that has confronted Japan in recent decades: whether to escape economic stagnation through a programme of fiscal stimulus, industrial policy and structural reform, or to accept a prolonged period of low growth and rising debt. But Thomas warns that simply borrowing and spending is unlikely to succeed without deeper reforms to boost productivity and encourage investment.

2. It’s cool (to know nothing). Are Andy Burnham and Lucy Powell bringing back stupid? That’s what Michael Gove asks over at The Spectator. He argues that the Government’s education reforms represent a retreat from academic ambition in favour of lowering standards, all under the guise of inclusivity. Rigorous academic education has been one of the most effective drivers of social mobility; steering pupils away from academic GCSEs will be an anti-intellectual mistake.

3. Millionaire move. For The Critic, James Hodgkinson poses a simple question: where are all the millionaires going? Britain is experiencing a genuine exodus of high-net-worth individuals, driven by a hostile tax environment and an erosion of the conditions that once made the country attractive to entrepreneurs and investors. The departure of wealthy individuals leaves the Treasury with less revenue and the wider economy with fewer jobs and lower growth.

4. Drink piece. Our own Christopher Snowdon has taken to his Substack to critique claims that Britain’s spike in alcohol-related deaths after 2020 was primarily down to long-term factors such as alcohol availability, advertising, or affordability. Instead, Snowdon argues that the sharp increase in alcohol-specific deaths during the pandemic was a consequence of lockdowns, social isolation, disruption to treatment services, and worsening mental health – and he has the receipts.

5. The limits of tolerance. At ConservativeHome, Harry Richer from Fighting for a Free Future has argued that Britain is failing to have an honest conversation about the limits of tolerance and our need for a stronger civic culture. Richer contends that tolerance – once understood as a liberal virtue that allowed people with different beliefs and lifestyles to live together – has increasingly become confused with the passive acceptance of behaviours that undermine social cohesion.