Does Burnham have a problem with profit?
Plus: capitalism in outer space, and Net Zero's threat to the grid
He’ll fix it – just don’t ask how.
Andy Burnham’s big speech on social care today was light on policy detail, as he said he would wait for an accelerated version of the Casey review next summer before making any decisions. There was a worrying sign, though, as reports came in that he is planning to shut profit-making firms out of the sector. Does business-friendly socialism have a problem with private enterprise?
Meanwhile, the banks are getting nervous that they may be in the firing line to help pay for the new Government’s promises. See Gerard Lyons below on why Burnham needs to think hard about second-order consequences before raising tax rates any higher.
Below you’ll find all the latest pieces from CapX, plus what we’re reading from around the web.
Marc Sidwell
Editor, CapX
Today’s Takes
Fresh thinking from CapX
Net Zero could collapse the grid
Ted Newson
‘The sheer cost of balancing the grid should convince even sceptics that we must invest more in firm power.’
On June 23 Britain’s grid came close to collapse. Despite an energy minister calling the claims ‘scaremongering’, new whistleblower information shows the grid had indeed been pushed past safe operating limits. As Britain’s Net Zero goals bring more renewable power online, new risks are being introduced when wind and solar fail to deliver. To maintain trust in the grid, politicians and grid operators must be transparent with the public. Read More
Nationalising Thames Water would sink Burnham
Mark Field
‘Welsh Water is touted by proponents as the model for mutualisation … but Welsh customers are tipped to have the highest water bills across England and Wales by 2030.’
Andy Burnham has already spent over £1.3 billion on policies that do nothing to stimulate economic growth. He cannot afford to stick taxpayers across the country with the bill for nationalising Thames Water as well. As for talk of a mutual model, the firm’s debt pile makes it a complete non-starter. Read More
The Capitalist: Who owns the Moon?
In June, SpaceX went public in the largest IPO in history. Three days earlier, a German historian published a book explaining why that moment had been 60 years in the making.
I sat down with Rainer Zitelmann to discuss ‘New Space Capitalism’, his account of how private enterprise took over the final frontier. We talked about how SpaceX cut launch costs by 95%, why the Space Shuttle was a fiasco, what cost-plus contracting does to a defence budget – and who will own the land beneath the first city on Mars.
Best of the Web
A warning to Burnham on tax
Gerard Lyons, The Telegraph
‘As the Scottish Government has discovered, raising new tax revenues is rarely straightforward.’
Scotland’s 48p top rate of income tax has raised less money, not more, as canny taxpayers changed their behaviour. Andy Burnham should absorb the lesson before the autumn Budget, especially if he is eyeing capital gains or property taxes. Modern tax systems were built around incentives and ability to pay, and there’s a reason for that. Read More
No, minister – lower growth isn't good news
Arthur Reynolds, City AM
‘The vast majority of Brits, myself included, do not want to consume less. We want more holidays, more pleasure in our lives, greater financial security.’
Katie White, newly promoted at the Energy department, once chaired the Mindfulness Initiative, which welcomed slower growth and wanted GPs trained to treat ‘eco-anxiety’ – not the prescription you’d expect after 15 years of stagnant incomes. If Burnham wants growth in every postcode, he’ll need ministers who believe in it. Read More
Policy is not pizza 🍕
Tim Knox
Stat of the day
And if you want more...
– The rise of the deserving rich (The Economist 🔒)
– Nuclear war is thinkable again (New Statesman)
– What happens to your data when you click delete? (The Conversation)
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