Transcription
Our GDP per capita is up by only 0.7% since the last time Trump visited Britain for a state visit in 2019. By contrast, America's GDP per capita is up by more than 9% during that time. We can't go on like this. We're spending and spending and spending, but the private sector that pays for all this spending is barely growing or even shrinking. It can't last.
I'm Alistister Heath and once again I'm responding to some of the excellent reader comments on my latest article about the staggering incompetence of the Labor Party and the collective embarrassment we should feel at the state of our country, especially during this second Trump state visit.
The first question is from Derek Riby who says, "Let's be honest, President Trump will know as well as anyone how incompetent we are. He has met members of our cabinet for God's sake. The fact is that despite all the pageantry, he will know that on the world stage, we are completely and utterly irrelevant."
Well, Derek, obviously he's aware that our cabinet and our government isn't exactly the best. And quite frankly, obviously, he doesn't particularly like any kind of socialist government, especially the Labor government. But I think the thing about Trump is that he really loves a certain idea of Britain. He loves our traditions and he loves the underlying philosophy that he believes we bequeathed to the world, including to America. I think the best way to understand the modern conservative movement in America is that they see their own country as a synthesis of Jerusalem, Athens, and Britain, and therefore the British element is very important to them. They, they like habeas corpus more than we do. They are more aware even than we are that Britain played a key role in eradicating the slave trade in the 19th century, for example. And I think that is very helpful for Britain diplomatically because it means that the Trump government can turn a blind eye to the dying competence and stupidity of our present government. And I think that's quite different to what Obama did or what Biden did. Both of those are much more hostile to Britain. And therefore, you had a a much purer form of diplomacy that wasn't shrouded by the sorts of pro-British sentiment that Trump and his colleagues display. But of course, that's not an excuse. That's not a reason to go soft on Starmer. Starmer is failing disastrously and conducting both domestic and international policies that the Americans clearly hate.
So the next question is from Paul Smith. Alistister is right to blame successive governments, but the unpalatable fact is that the great British public like free stuff and a significant part of the population enjoys being nannied by the government. In America, they have a different mindset.
Well, yes, I think that is part of the issue, but I think ultimately we have suffered from a British establishment that has lied to the public. Our politicians, both from the Labour Party and the Conservative Party, and also the SNP in Scotland and the Liberal Democrats when they were in coalition with the Conservatives, all that sort of stuff. These politicians have pretended to the public that life would be easier than it really is. They have sold a vision of Britain that we can't actually afford. They have insisted that we can go on spending more and more and more money on the NHS and that the NHS could grow and grow and grow, and all of that could simply be paid out of taxes and that there will be no impact on our prosperity. Astonishingly, the full-time equivalent workforce of the NHS is up by 90% now since 1999. Soon it will have doubled in a 30-year period. The NHS is continually growing, hiring more and more people, and all of that is being paid by the taxpayer. And the problem is taxes are at an all-time high, and that is crippling the economy. It is one of the reasons why there's virtually no productivity growth in Britain and very little GDP growth. We just can't afford that. We also can't afford to be spending money on 6.5 million people who are in receipt of out-of-work benefits. We can't actually afford the triple lock pension. We can't afford endless benefits to endless people, endless subsidies, endless government programs, and a public sector that keeps on growing. We just can't afford it. And our politicians have spent 30 years, or 27 years at least, telling the public that we could. So, yes, the public enjoys these benefits and votes for more. But I really blame the politicians who have basically conditioned them into believing that, uh, they could have a free lunch.
The next question is from somebody who calls himself Don Draper. One key difference between America and Britain is cultural. For the most part, people accept that they do well or less well because of their choices. Here we have a toxic combination of victimhood and welfareism.
I think this is a very good point. Thank you. Uh, I think a slight exaggerated point in the sense that I also think there's plenty of victimhood and welfareism in America, just that there's less of it. We've just got far too much of that. It has become some of the dominant ideologies of Britain. Other dominant ideologies of Britain include egalitarianism, this idea that we all need to be made equal, that outcomes need to be made equal via state action, via repressive taxation and redistribution. And also this belief in the NHS as some sort of secular religion, while in fact countries all over the world would never dream of adopting the kind of model we have for our healthcare. A much better model, by the way, is not the American model, but the Swiss model or the Singapore model. And I hope that one day, one day, Britain sees the light and decides to move away, uh, from the NHS. But there you go. I think when the Americans look at Britain, they see a country that's increasingly poor. They look at our average earnings and they look at the average earnings of the top 10%, the top 20%. And let's face it, Americans make a lot more money than we do. And the gap is growing. That is directly as a result of the superior economic performance of America, caused by things like the shale energy revolution, the entrepreneurial culture, their pro-growth tax system, all those sorts of policies. While we have deliberately crippled the City of London, we have deliberately inflicted upon ourselves much more expensive energy and very expensive electricity. And we have regulated everything that moves. It's been a disaster. Britain is becoming poorer relative to America. America is becoming richer relative to Britain. And the gap is growing disastrously wide.
The next question is from Philip Andred. Next year will mark the 250th anniversary of the American Declaration of Independence. It will also mark the 50th of the UK gain cap in hand to the IMF. What are the odds of another such humiliation for our country by July the 4th next year?
That is a very good juxtaposition of anniversaries. America will be celebrating its independence, but we will be in a very bad place next year. The situation in Britain is going to get worse, not better. This government is already hated. There's hardly any support left, uh, for Starmer. Reform is growing. Labor is plummeting in the polls. And I think the big problem is the fiscal situation. That is one of the big ticking time bombs under British society. The budget, when it comes towards the end of the year, is going to be a massive set of very nasty tax increases. There'll be as large or even larger than what was inflicted upon this country to disastrous economic effect last year. So we're going to have all of that again, and even that will probably not be enough to plug the massive black hole at the heart of the government finances. So next year is going to be very grim. It will be the year where the markets may decide to force Britain to live within its means for the first time in years. If that were to happen, that would trigger a lot of political instability. Will it actually lead to an IMF bailout? I don't think so, because the IMF is too small to actually bail out the British economy. But could we be due a fiscal crisis? Yes, quite possibly. I think the chances of that are going up all the time, especially now that the OBR has accepted that our productivity growth is even lower than previously thought.
I will just leave you with one key statistic. Our GDP per capita is up by only 0.7% since the last time Trump visited Britain for a state visit in 2019. By contrast, America's GDP per capita is up by more than 9% during that time. We can't go on like this. We're spending and spending and spending, but the private sector that pays for all this spending is barely growing or even shrinking. It can't last.
The next question is from James Paret. Amazing to see how many people think our malaise is purely down to our current government. The chaos of Boris, the lunacy of Truss, the catastrophe of Brexit. What did you expect?
So obviously, as I say in my piece, the problems of Britain are not only due to Starmer, but Starmer has made everything worse. This Labor government has been a complete disaster, but it's built on the past 27 years of failure. We last had a good government, roughly speaking, 1997, though obviously it had run out of steam and was engulfed by sleaze scandals and all sorts of other problems. But the subsequent 27 years have been a catastrophe in terms of political philosophy, legislation, and the economy. We've effectively adopted a European-style social democracy. We've wrecked our constitution. We've introduced a rule by lawyers. There have been many, many problems, uh, since that time. I think Starmer has made everything worse, but he's not the only responsible man. Obviously, I think the Conservative Party failed lamentably during its time in office. And in many ways, Starmer is merely continuing their bad policies, which in turn, by the way, were continuation of bad policies from the Blair-Brown era. So, I think our political class shares the blame for our crisis, and I think there's going to be a reckoning coming soon, a democratic reckoning.
That is all we have time for today. Thank you to all our subscribers for their comments. Keep them coming, and we will try and respond to as many of you as possible.