Growth

Anatomy of an obsession

Milton Keynes, a new town planned and built in the Buckinghamshire countryside in the 1960s. It sits between Oxford and Cambridge, in the middle of the “Silicon Valley” imagined by British politicians.

Those who say Britain is ruled by a uniparty – a single agenda that unites both Labour and the Conservatives – will feel vindicated by the government’s latest proposals. Labour prime minister Keir Starmer and his chancellor, Rachel Reeves, have been scavenging from the sizeable waste heap of ideas abandoned over 13 years of Conservative rule. They want to expand Heathrow airport, a plan already approved by governments in 2009 and 2018. They suggest turning the region between Oxford and Cambridge into “Europe’s Silicon Valley,” a fantasy hatched by Boris Johnson (though all five Conservative Prime Ministers between 2010-24 promised to emulate Silicon Valley somehow). Like so many of their predecessors, they are pledging to cut back environmental protections and planning regulations, while Starmer has made a point of repeatedly praising Margaret Thatcher.

Most familiar of all, though, is the stated rationale for these plans. Labour have contracted that weird tic, especially reminiscent of Liz Truss’ ill-fated stint in government, which involves ranting incessantly about economic growth, repeating and circling back to the phrase with a mindless obedience that would embarrass a doctrinaire Maoist. There is no policy so unrelated that it cannot be made about growth. A recent Labour press release mentioned “scrapping the need for people to queue at the local council to register the death of a loved one – getting in the way of growth.” It’s as though they believe that economic growth can be willed into being simply be repeating the word. Growth growth growth growth growth growth growth growth growth.

Some of this can be explained by the chancellor’s recent financial problems. In January, the government’s cost of borrowing surged alarmingly (more echoes of Truss) as the investors who buy this debt showed their doubts about Reeves’ agenda. When British politicians talk about growth, it is partly to reassure “the markets” that they can keep lending cash (which is needed to fund the promises that get those politicians elected in the first place). But there is also an influential section of the UK intelligentsia which is genuinely obsessed with economic growth. These are basically neoliberals, whose ideas of progress hinge on removing barriers to the free market. What gives British politics its repetitive, uniform character is the on-going battle between this growth movement and another great power in the land, the so-called “blob” of administrators, lawyers, civil servants, NGOs and so on, who derive their influence mainly from the setting of rules.

This struggle has generally resulted in the UK getting the worst of both worlds, a peculiar combination of market “discipline” and bureaucratic excesses. In many ways, the neoliberals have got the world they wanted: for several decades, boundaries and standards of all kinds have been lowered to facilitate the circulation of capital, people and goods; public utilities are owned by hedge funds, technology is worshipped, and “market principles” have been imposed on a wide range of institutions (almost regardless of their purpose). Far from turning Britain into a model of economic productivity, this had led to chronic underinvestment, falling living standards and widespread insecurity. But supporters of this vision have never had to acknowledge its failures, since they can always point to the irrationality and mismanagement that continues to accumulate in the legal and administrative layers of the British state. Consider, for instance, the ruling by employment judges that retail shop staff and warehouse workers must receive equal pay, even though they are doing totally different jobs. Or the now-infamous £100 million tunnel to protect rare bats in the vicinity of a high-speed railway line. The dysfunction of official Britain allows market evangelists to claim that real deregulation has never been tried. As the economic historian David Edgerton puts it, they have “presented themselves as outsiders and radicals,” even as they “tell the elite what they already believe.”

I’m not disputing that material prosperity should be a central goal of government policy, or that the UK needs much more of it. I sometimes hear Britain described as “a rich country,” which immediately makes me suspect that the person speaking has not seen very much of it. Economic growth is generally an important component of prosperity, and a reasonable gauge of it. But the two are not the same. Prosperity consists in a wide range of things, relating not just to resources but to quality of life, whereas growth just refers to the monetary value of goods and services produced in a given area. Growth is not desirable for its own sake. It matters where it comes from, at what cost, and who will benefit (and suffer). This seems quite obvious to me – again, we don’t benefit from growth as a statistical artefact, only from actual conditions of prosperity – but quite often, the growth movement seems unwilling to acknowledge such distinctions.

In October, for instance, three think-tankers published an influential pamphlet called Foundations, urging the deregulation the housebuilding, infrastructure and energy production. The authors describe how “as late as the 1930s, there were almost no restrictions on development” in the UK, how there are fewer building regulations in the United States today, and how the French have more houses than we do. Yet none of these comparisons mention the simple variable of space. Britain is a small, crowded island – significantly more crowded than a century ago – and though governments have failed to meet their building targets, you only have to take a train around southern England to see that houses, especially, are being built in large numbers. Britain is stagnating economically, but the countryside is still vanishing. Unsurprisingly, all of this affects people’s attitudes towards further development. Similarly, take Robert Colvile in the Sunday Times, mocking the regulations that will obstruct Reeves’ plans to build new reservoirs:

But has she thought about biodiversity net gain? Catalogued the ancient, veteran and notable trees? Examined the geology? Considered the flooding risks?

Such concerns are ripe for mockery because they have become synonymous with bureaucratic absurdity, and I am with Colvile on the need to build more reservoirs (not for the sake of economic growth, but because it’s ridiculous that a country as wet as Britain suffers from water shortages). And yet, since many Brits quite like nature, and dislike flooding, and don’t want to turn the entire country into a Zone 4 London suburb, we need some way of accounting for these things.

Of course, we aren’t the only society to fixate on economic metrics. As Hannah Arendt suggested, this tendency is inherent to the concept of society itself, a modern construct which treats people like members of giant household, expecting them to conform to certain patterns of production and consumption, and taking the banal necessities of life – work, sustenance, distribution of resources etc. – as the natural focus of their collective efforts. Thus the actions of individuals are replaced by the predictable behaviour of people in “the economy.” This domestication of politics is driven, in part, by the growth of the state, for which the details of national income are crucial for the payment of public sector employees, the management of debts, and the funding of public services and welfare programs.

Still, even within the “communistic fiction” of our shared household, as Arendt calls it, we don’t have to be so narrowly concerned with economic production. One alternative would be to focus on social trust. Imagine, for instance, if we decided to aim for a society in which the following is true:

1. People don’t need to lock their houses and cars.

2. Children can be left to roam safely and independently over a wide area.

3. Everyone has convenient access to “third spaces” – that is, places which are neither work nor home (pubs and cafes, playgrounds, exercise areas, parks and squares etc.)

4. Loneliness and isolation are much rarer, especially among the elderly and the young.

5. Public spaces are treated with pride, by those who provide them and those who use them.

I’m not arguing that we should pursue these things instead of material wealth. But it seems to me that they would make significantly more difference to most people’s lives than marginal levels of economic growth, and while there are certainly ways that growth could contribute to them, it does not seem necessary for them. For much of the 20^th century, many western countries were closer to realising these goals than we are today, despite also being poorer.

And who knows, maybe such improvements could make us more productive as well.