Andy Burnham ‘won’t be unrealistic’ when it comes to tax rises in the autumn, so brace yourselves.
The Prime Minister was facing up to reality on several fronts today. First, he seemed to back away from his pledge to expand council housing, by directing most new funding towards housing associations instead. And, in an even sharper break with his campaign rhetoric, plans for the nationalisation of Thames Water have apparently been shelved as unaffordable. We told you so, Andy.
No such realism, however, on the Government’s plans to restrict zero-hour contracts. With the official analysis projecting the changes could cost businesses £3 billion a year, they are less than happy. But as consultation on the reforms ended today, there was no sign of retreat. Labour seem to have learned little from their ill-judged hike to employers’ NI.
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
Trump’s Iran sanctions might just work
Stephen Pollard
‘As we saw with the mass anti-regime protests in January, economic deprivation leads to civil unrest. Further sanctions could yet topple it.’
Donald Trump’s recent economic sanctions against Iran and any nation financially dealing with it have come under fire from architects of the Iran Nuclear Deal. But should he listen to these critics when their deal gave Iran an economic boost? That emboldened Iranian proxies, leading to attacks like October 7. If Trump continues pressuring the regime, his sanctions might yet work. Read More
Three questions the new AI Minister must answer
Jennifer Holly
‘We risk being left with a minister with a lot of responsibility but little authority.’
AI policy is now in the hands of Kanishka Narayan. But can one minister, with a deceptively specific brief, manage a technological revolution? If the UK’s strategy is to be successful, he needs to answer some big questions – and recognise AI is more than just a cost-cutting tool for Whitehall. Read More
Stat of the Day
Best of the Web
Don’t blame the markets
Michael Strain, Financial Times 🔒
‘Free markets facilitate growing economies, which in turn facilitate important virtues.’
Economic freedom is out of fashion. In America, the electoral energy is with the Democratic Socialists of America and, on the MAGA side, with JD Vance and his public scepticism about economic growth. Both sides argue free markets are morally corrosive. That’s badly wrong. It’s not markets corrupting society – too often, it’s the other way around. Read More
Burnham's nationalisation plan springs a leak
Matthew Lynn, The Spectator
‘It turns out that taking Thames Water into a form of state ownership doesn’t magically make all its financial problems disappear.’
Thames Water won’t return to public ownership as quickly as planned. Plans to place the troubled utility into a ‘special administration regime’ have been postponed as it could cost the Government up to £2 billion, and that’s just for starters. Burnham promised nationalisation would save everyone money. Now he’s seen the numbers, it doesn’t wash. Read More
Jenrick: we can’t afford not to cut welfare
Liam Halligan
The Capitalist: Nimbyism is a national security threat
And if you want more...
– Put bondholders in the House of Lords? (Marginal Revolution)
– Mozart’s lessons on living well (Engelsberg Ideas)
– Democracies need creative destruction (Foreign Affairs)
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