Price caps are a fool's errand
Soviet-style supermarkets won't work
There’s joined-up government, and then there’s, well, this Government. After whipping its MPs to vote against drilling in the North Sea last night, today it was relaxing sanctions so we can buy more Russian oil instead. Meanwhile, the Treasury came out with some genuinely promising measures that might actually get new energy and transport infrastructure built – on the day it emerged it was pursuing the most economically wrongheaded idea possible, by looking into price controls on supermarkets. Oh, and tougher anti-price-gouging powers as well. Can you regulate for growth and degrowth at the same time?
Also today, the Prime Minister vowed he’d be in post until at least Christmas. Wes Streeting – now openly running to replace him – used his resignation speech to call for a new ‘special relationship’ – with the EU. Meanwhile Andy ‘business-friendly socialism’ Burnham already has voters putting Labour under his leadership ahead of Reform in the polls (see our Stat of the Day, below). Sadly, someone has to win.
Below you’ll find 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
Only a fool or a politician would cap food prices
Andrew Lilico
‘What conceivable rationale could there be for capping supermarket prices in the UK today?’
In response to accusations of ‘price gouging’, the Government is reportedly considering asking supermarkets to agree to caps on the prices of 20 items in exchange for the temporary relaxation of some cost-raising regulations. This would prove a disastrous piece of intervention that would leave consumers worse off. Read More
Starmer has bottled welfare reform – again
Helen Whately
‘Last week was a chance for Keir Starmer to show us how serious he is, by committing to bringing forward legislation to tackle mounting welfare costs. He decided against this.’
Keir Starmer says he is fighting to stay. The problem is that is all he is doing. Last week’s King’s Speech was written to save his skin, not to fix anything. Take the spiralling welfare bill, which even his own Chancellor recently admitted desperately needs gripping. But there was no Welfare Bill in the King’s Speech – and without that there can be no serious reform. Read More
The bond markets are right to be worried
Joseph Dinnage
‘The prospect of Burnham considering major spending cuts is about as slim as him going a minute without mentioning Oasis or Everton Football Club.’
The IMF has issued a stark warning to Britain’s policymakers: rein in borrowing and spending or face the wrath of the bond markets. Traders are already concerned by Andy Burnham’s leadership ambitions, signalling that they’d prefer gradual decline under Keir Starmer to full-fat socialism. With Labour having given up on fiscal prudence altogether, it’s up to the Tories and Reform UK. Read More
The Capitalist
In this week’s special episode of CapX podcast, we share a speech by Shadow Chancellor Mel Stride on the economy, including:
Why Britain’s gilt yields are the highest in the G7
How the ‘Burnham premium’ could cost every working household £300
Labour’s plans to borrow a quarter of a trillion pounds more across a single Parliament
Watch on YouTube; listen on Apple Podcasts or Spotify.
The CapX Reading List
The best of the web today
My generation has known only political chaos
Emma Revell, City AM
‘We need to find stability of some kind soon – otherwise the issues that have plagued us for nearly two decades might become terminal.’
Not since Tony Blair has Britain had a political leader who was able to win a general election and actually enact major policy change. Which means that for people under 40, their entire adult lives have been lived under governments who couldn’t actually govern – and with the near total collapse of his authority, Keir Starmer is plainly not the man to change this. Read More
Can Andy Burnham take credit for Manchester's success?
James Breckwoldt, The Spectator
‘Manchester at least proves decline is not inevitable. Britain is not doomed. Institutions can improve. Growth can return.’
It’s no secret that Andy Burnham likes to take credit for Manchester’s success. But is that justified? Greater Manchester’s success is real, but none of it happened by accident. The truth is that much of what has made the city great comes from Burnham having inherited a relatively healthy institutional ecosystem. Read More
We have a migration data problem
Neil O’Brien, Substack
Stat of the Day
And if you want more...
– The return of the Western question (Engelsberg Ideas)
– English wine has never been so good (London on the Inside)
– Why Iran is right to be paranoid (UnHerd)
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