Fiscal conservatism, economic radicalism

Sir Keir Starmer has ruled out significant rises in public spending under a Labour government. He's partly right. What his supporters and many critics fail to appreciate, however, is that a tight fiscal stance is wholly consistent with some very left-wing policies.

First, why is he partly right?

The answer has nothing to do with "iron-clad fiscal rules". Such talk is merely to appease the nonces, imbeciles and billionaires' gimps in the media.

Instead, Labour's problem is that we are close to effective full employment; certainly, there are very few doctors or builders out of work. This means that any increase in public spending in excess of taxes would be potentially inflationary and would therefore (given the current inflation target) lead to the higher mortgage rates Sir Keir warns us of.

Just as Blairites fail to see that it's not 1997 any more, so some of Starmer's critics fail to see that it's not 2010 any more. There aren't the unemployed real resources to permit a significant fiscal expansion.

This does not, however, justify sticking with every detail of the Tories' spending plans such as the two child benefit cap. From an economic point of view, increased public spending is perfectly acceptable if it is matched by taxes which would offset the boost to aggregate demand. Sticking with the Tories' plans might be a coherent media strategy, but it is not an economic necessity.

Rigid fiscal discipline, however, by no means rules out radical policies. Here are a few Labour could follow:

Economic democracy.

It's no accident that our 15-year long stagnation in productivity and real wages followed rising inequality, because there are many channels through which inequality can depress output. Fixing this requires institutional change. As Joe Guinan and Martin O’Neill say:

The institutional arrangements at the heart of today’s British capitalism – concentrated private ownership, corporate dominance, and the overweening might of London-based finance capital – together form a powerful engine for the extraction of value and its distribution upwards. It is this basic institutional design that drives the outcomes we are seeing in terms of crumbling public infrastructure, social atomisation, environmental degradation, and a widespread sense of popular disempowerment.

Part of the solution here involves tougher regulation and tax reform, such as abolishing the carried interest anomaly - a fiscal tightening Labour should approve.

Another part requires the encouragement of more worker democracy (pdf), simply because we have evidence that this would raise productivity. As Virginie Pérotin puts it:

Worker cooperatives are more productive than conventional businesses, with staff working “better and smarter” and production organised more efficiently.

This could be done by - for example - using central and local government procurement to favour worker-owned companies or social enterprises; giving workers first refusal when a business is sold; encouraging lenders to better support coops (assuming that a National Investment Bank is off the agenda for wrong-headed fiscal reasons); or giving tax breaks to employee ownership schemes.

Tougher regulation.

Beefing up competition policy doesn't require more public spending. Nor does an attack upon regulatory capture: the revolving door between Ofwat and water companies' management shows that the former does a poor job of keeping the latter in its place.

We don't necessarily need nationalization to address this problem. We could convert water companies into franchises which bid for time-limited contracts to supply water, run sewage networks and so on.

Alternatively, the government could simply impose price caps itself on utilities rather than have captured regulators do so. The theory of the second-best shows us that where there is a market failure (such as a natural monopoly) another market "distortion" can be efficient.

Tax and benefit reform.

Taxes and benefits both need to be simplified. Reducing the conditions attached to Universal Credit, for example, would be a small step towards a basic income and would actually be "fiscally responsible" by cutting the number of administrators and work coaches.

And the goal of tax reform should be to shift towards taxing (pdf) inheritances and land rather than incomes - starting perhaps with a commercial land tax.

A maximum wage.

This is typically justified in terms of fairness, to stop executives earning hundreds of times more than their employees.

There is, however, a case for such a limit in terms of efficiency.

For one thing, big inequality can reduce an organization's efficiency as middle management spend their efforts on office politics or looking for the next job; or as they look to highly-paid bosses to give the lead rather than taking their own initiative.

Against this, you might argue that such a maximum would reduce the supply of talented bosses even more than it is currently restricted. This, however, could be a good thing: if it encourages the break-up of large firms it would decrease monopoly power.
If the maximum does not apply to companies where the CEO has a large ownership stake, it would have another advantage. It would encourage CEOs to set up their own companies. In this way, we'd get an increase in the number of talented entrepreneurs.

Now, I've not gone into detail on these because, to paraphrase Marx, there's no point writing recipes when you don't have a kitchen. Instead, I'm just saying that Labour could in principle be economically very radical even whilst having a tight fiscal policy and ruling out nationalization.

There's a strand of social democracy - I'm thinking of Polly Toynbee - which see politics largely through a tax-and-spend lens and which is therefore disappointed by fiscal restraint. Such a social democracy however works only if capitalism is healthy so that economic growth will deliver taxes. But capitalism is not healthy. We need radical supply-side measures to boost productivity.

You'll object here that the policies I've outlined are neither "practical" nor "credible".

And that's the point. Although these policies might well boost economic growth (and I've not mentioned rejoining the single market) whilst reducing inequality Labour is not offering them. Which suggests that its talk of fiscal discipline is not merely an economic policy. It is instead part of a wider message - of placating the right by showing that it is no threat to inequality and extractive capitalism. Labour is capital's second XI - and the second XI of the most backward and regressive parts of capital at that. 

Comments

[Ernie Bornheimer]

Sorry, what's XI?

[alexg]

XI = eleven = the players on a football team, the "second XI" being those who were not quite good enough to be in the "first XI"

[alexg]

or a cricket team

[Ben]

I remember a study of CEO's success and failure and it proved that it all down to chance.

[Dr Andrew Kitching]

Your last three paragraphs are spot on. I don’t think Labour has the courage or imagination to try out your policy ideas.

[begob]

"theory of the second-best" links back to this article.

[Jan Wiklund]

Partly right, but according to the Care Quality Commission there are lots of medically educated people who have left the business because of its poor funding and disgusting ways of treating its employees. Perhaps they could be induced to come back? But then one must pay for that.

[rsm]

《Instead, Labour's problem is that we are close to effective full employment; certainly, there are very few doctors or builders out of work. This means that any increase in public spending in excess of taxes would be potentially inflationary and would therefore (given the current inflation target) lead to the higher mortgage rates Sir Keir warns us of.》

Does this story assume the neoliberal catechism that inflation is a monetary phenomenon?

What if instead of tax-and-spend policies that accept monetarism as underlying doctrine, political leaders used the bully pulpit to paint prices as psychological noise, easily neutered by indexation?

[aragon]

Equalising the taxes (at the higher rate) on investment/capital gains vs trading/income would reduce the opportunity for tax arbitrage. As done by Nigel Lawson and undone by Gordon Brown.

Capitalism has already been replaced by financialisation and profit extraction.

Nothing will boost economic growth, as economic growth is not a function of financialisation.

Tony Blair is still selling the same old snake oil!

https://www.newstatesman.com/comment/2023/07/labour-tony-blair-agenda

"First, we need to control expenditure on palliative items to free up resources to invest in productive areas. Second, we need to reform radically the way public services work so that new technology is adopted and implemented. Third, as this technology is implemented, we need to realise the savings this will bring.

[...]

A further theme of the conference was that public services were slow to adopt new technology and that the private sector was frequently more innovative. A place for the private sector in delivering public services, it therefore follows, is beneficial.

[...]

The Blair analysis – both in terms of the scale of the challenge the country faces and his prescription for addressing it – is persuasive."

No the non-solution, is facile and superficial and does not address the corruption that is looting of the economy by finance.

[Laban]

"We need radical supply-side measures to boost productivity."

As I said before, a 1730s UK with current immigration levels would never have had an Industrial Revolution. Why try and save on the use of labour when people are so cheap?

IMHO we need radical supply-side measures to increase the cost of labour.

It doesn't do Japan any harm.

[aragon]

https://www.economist.com/britain/2023/07/20/sir-tony-blair-mesmerises-the-labour-party-again

"But both men acknowledge that a Starmer government would inherit none of the benign conditions that underpinned big-spending New Labour. (In December 1997, Jonathan Powell, Sir Tony’s chief of staff, sent him a memo warning of laughably trivial concerns of the time: a row over fox hunting; the state of the Millennium dome; a concern that economic growth could prove too strong.) The sort of constitutional reforms New Labour embraced—devolution, human-rights legislation—look scarcer now. The geopolitical backdrop is far more dangerous. And the public optimism that Sir Tony rode has been replaced by cold cynicism towards an entire political class."

[Blissex]

««Labour could in principle be economically very radical»

That would be what is now called "predistribution", that is changing rules and institutions to reduce the advantage that big concentration of capital and power give over the lower classes.

«even whilst having a tight fiscal policy and ruling out nationalization.»

It is good that here our blogger is not talking about the imaginary "austerity" (both fiscal and credit policies being tight to reduce consumption across all classes), but pointing out that only fiscal policy has been tight, and only towards the lower classes.

It would be even better to make explicit that instead credit policy has been exceptionally generous to asset speculator in finance and property (currently for "friends of friends" the BoE real interest rate is deeply negative), and that when finance property have needed it, as after 2008, even fiscal policy has been exceptionally generous to finance and property interests.

«Labour is not offering them [...] showing that it is no threat to inequality and extractive capitalism.»

The thatcherites of the Mandelson Tendency who have captured Labour are actually entirely in favour of inequality and extractive capitalism, because their core constituency is by choice the affluent southern property owning middle class, who have ben enjoying for decades booming living standards thanks to inequality and extractive capitalism.

[Blissex]

«a 1730s UK with current immigration levels would never have had an Industrial Revolution. Why try and save on the use of labour when people are so cheap? IMHO we need radical supply-side measures to increase the cost of labour.»

Things happen when there enabling factors and triggering factors:

* In the 18th century arguably the trigger was the long shadow of the Black Death reducing the labour supply, but there was also the enabling factor of abundance of coal and a new technology that enabled it via steam power to substitute for labour power. The same happened after WW1 and WW2 for the first and second switches from coal to oil.

* Currently there is no enabling factor for large productivity increases, that is there no new fuel that is both cheaper, lighter and more energy dense than oil and derivatives.

Because of the latter point scarcity of labour would result not in large increases in productivity, but in ending the upward redistribution from workers to property and business owners, two categories that are politically skilled and powerful.

«It doesn't do Japan any harm.»

[Laban]

"the public optimism that Sir Tony rode has been replaced by cold cynicism towards an entire political class."

To be fair, Blair is responsible for a great deal of that cynicism. I was so happy when he won in 1997, by 2000 I hated his guts - and that was well before Iraq.

His 1998 decision to stop all new civilian nuclear build wiped out a generation of nuclear engineering expertise with consequences which are with us today.

[Blissex]

«https://www.economist.com/britain/2023/07/20/sir-tony-blair-mesmerises-the-labour-party-again
"But both men acknowledge that a Starmer government would inherit none of the benign conditions that underpinned big-spending New Labour."»

As part of the one of the most important article in the past decades in UK politics Tony Blair wrote lucidly in 1987 about the conditions that underpinned big-spending New Conservatives (Thatcher etc.):

http://www.lrb.co.uk/v09/n19/tony-blair/diary
“Mrs Thatcher has enjoyed two advantages over any other post-war premier. First, her arrival in Downing Street coincided with North Sea oil. The importance of this windfall to the Government’s political survival is incalculable. ...
Bank lending has been growing at an annual rate of around 20 per cent (excluding borrowing to fund house purchases); credit-card debt has been increasing at a phenomenal rate; and these have combined to bring a retail-sales boom – which shows up dramatically in an increase in imported consumer goods.
Previously such a boom and growth in imports would have produced a balance-of-payments deficit, a plunging currency and an immediate reining-back on spending, with lower rates of growth.
Instead, oil has earned foreign exchange and also produces remittance payments from overseas investments bought with oil money. The situation is neither stable nor healthy in the long term: but in the short term it allows the living standards of the majority to rise rapidly, even though the industrial base, the ultimate foundation of a successful economy, is still only achieving the levels of output of 1979.
The fact that we have failed to use oil to build a productive and modern industry for the future is something historians will deplore.”

When he got in power he did the same, only more so (without the mythical "big spending", using PPI). The UK became a net importer of oil more or less in the month when he handed over to Gordon Brown. Smart exit. This is a graph that well describes UK politics since the 1960s:

https://blissex.files.wordpress.com/2018/04/dataukoilextrconsexpmazama1965to2015.png

[Blissex]

«His 1998 decision to stop all new civilian nuclear build wiped out a generation of nuclear engineering expertise»

That happened previously to marine engineering when the docks were closed down, and various other engineering branches and various trades and professions that were offshored to countries with workers less "lazy, uppity and unaffordable" than UK workers.

Some right-wing think-tanks have called engineering and computing "legacy" subjects and are advising the government to stop funding research and degrees in them, because it is much cheaper to buy engineering and computing products from China etc. than to make them in the UK, and to hire the few engineering and computing professionals still required from India etc. than to train them in the UK.

This has already largely happened for medical doctors and nurses, where university and training places have been cut considerably because of how expensive they are, and where doctors and nurses trained at the expense of foreign treasuries are very willing to immigrate into the UK.

https://www.theguardian.com/society/2022/feb/09/britain-needs-to-double-the-number-of-doctors-it-trains
"Last year 59% of new registrations in England had been trained by other countries, writes Prof Rachel Jenkins [...] The number of medical student training places in the UK needs to double. This should not be as expensive to Treasury as feared"

https://www.theguardian.com/society/2022/jun/08/nhs-hiring-more-doctors-from-outside-uk-and-eea-than-inside-for-first-time
“Unpublished figures from the General Medical Council (GMC) show that 7,377 (37%) of the 19,977 doctors who started work in the NHS in 2021 had a British qualification. A total of 10,009 new medics learned medicine outside the UK and the EEA – so-called international medical graduates (IMGs) – compared with 9,968 within. [...] In 2021 a total of 1,645 doctors from India began working in the UK, as did 1,629 from Pakistan, 1,250 from Egypt, 1,197 from Nigeria and 522 from Sudan – a total of 6,243.”

[Laban]

Blissex "medical doctors and nurses, where university and training places have been cut considerably because of how expensive they are"

Not so, doctor training places have increased, there are new med schools all over the place compared with say 2000.

Why the shortage of doctors then?

a) med school used (in 60s) to be 85%+ male. Those guys worked til retirement. And back in the day the 15% female often worked til retirement too.

Now it's 55% female.

This has two consequences - lots of women quacks work 2 or 3 days a week, quite a few take time to have babies (A GOOD THING), some who bagged consultants pack it up, drop their registration and design fabrics. If your workforce is 55% female you need to more than double it to get the same doctor-years as if it were 100% male

b) places like Oz and NZ pay junior doctors a fair bit more, plus it's a nice place to live. Without raising wages you will lose a number of docs overseas. It's almost a cliche that a med grad does two compulsory hospital years then heads Down Under.

Nursing training is a heap big disaster inherited from the back end of the Thatcher years. Back in the day nursing training still took 3 years, but it was on the job, you got paid from day 1, no student loans. SEN for the not so bright nurses, SRN for the brighter ones.

"Project 2000" arrived, and nurses now needed student loans.

https://en.wikipedia.org/wiki/Project_2000

This was a disaster in several ways

1) a lot of very good nurses pre-P2000 were already graduates. These all vanished from the recruitment pool overnight - who could get a second lot of debt, and who wanted it? A lot of my uni friends became nurses.

2) prior to loans you could do a couple of years of training and then decide that blood and poo wasn't for you, and maybe an office would be nicer, or maybe an airline. Now people two years in already have big debts, it's too late, they have to stay or leave with debt and no quallies. Result - there are quite a few nurses who don't like the job and really shouldn't be in it.

3) the uni-based training wasn't as good as the practical stuff. Highly politicised. See below. I'd done sociology, but the new training puzzled my wife.

https://ukcommentators.blogspot.com/2003/10/come-back-miss-nightingale.html

(Sources - a lot of family in the doctoring and nursing trades)

[aragon]

UK under Starmer.

Government by Finance Companies (McQuarrie, KKR, Apollo, Black Rock. PWC, EY etc).

Administration by Microsoft.

Health by Palantiar.

Entertainment by Hollywood (Microsoft/Japan - Computer Games).

Advanced Manufacturing Taiwan/South Korea/Japan

Manufacturing by China

Operations by India

Rust belt - The West - The UK, Europe, (less so USA).

Russia/Middle East/Africa - Mass Em/Immigration to UK/Europe.

@Laban,

Don't dispair...

Palantiar will be running the Health service (or at least the I.T. with AWS the infrastructure) as soon as Tony and Wes can arrange it.

New Labour poured money into the Health Service, no money this time, bootstraps and capture savings for debit reduction (three point plan).

Continue outsourcing Government.

So privatise the Health Service to Palantiar who will provide the necessary 'Investment', innovation and expertise?

The City benefits from M&A and laundering dirty cash. Tories approve.

Say it ain't so: Starmer...

[ltr]

"Manufacturing by China"

This is of course nonsense, but what is beyond understanding is why there is such a British disdain for China and working with China. China would add importantly to British growth were there wide-ranging trade relations between the countries.

There is a sore need to get over the British imperial mind-set with regard to China, and stop allowing America to dictate harmful trade relations with China for Britain.

Britain needs to be working closely and broadly with China.

[ltr]

China could bolster British growth importantly.
Relations between the countries should be close, no matter American attempts to isolate Britain:

https://fred.stlouisfed.org/graph/?g=175mB

August 4, 2014

Real per capita Gross Domestic Product for China and United Kingdom, 1977-2022

(Percent change)

https://fred.stlouisfed.org/graph/?g=175mD

August 4, 2014

Real per capita Gross Domestic Product for China and United Kingdom, 1977-2022

(Indexed to 1977)

[aragon]

Palantiar is Palantir
I never read the Hobbit/Lord of the Rings.

https://www.bbc.co.uk/news/technology-56183785

"But Open Democracy, which labels Palantir a "spy-tech" company, is critical of the extension of that short-term contract in December. It will now run for two years, and cost £23.5m."

https://doctorow.medium.com/how-palantir-will-steal-the-nhs-c234cacf3093

"All that liquid capital means that Palantir doesn’t have to win NHS
contracts — it can simply buy up other companies that have won them.
Palantir’s strategy leaked to Bloomberg, and Olivia Solon lays it out:

https://www.bloomberg.com/news/articles/2022-09-30/palantir-had-plan-to
-crack-uk-health-system-buying-our-way-in

"Palantir’s Mosley said he’d target NHS software suppliers with "credible leadership" and revenue between £5–50m, offering their founders "v. generous buyout schedule (say 10x, especially if all stock)," adding "(we might even be their only real exit option).""

"Palantir ran their own separate lobbying as well, hiring Indra Joshi and Harjeet Dhaliwal away from the NHS to push their agenda in Westminster:

https://www.bloomberg.com/news/articles/2022-04-21/palantir-hires-ai-chief-from-nhs-in-u-k-as-it-bids-to-expand"

Also:
https://www.theregister.com/2022/11/25/family_doctors_conference_calls_for/

[Blissex]

«doctor training places have increased, there are new med schools all over the place compared with say 2000. Why the shortage of doctors then? [... women doctors effectively work part time as a lifetime average ...]»

That's a useful point, but still state student loans for medical degrees are capped to just over 1/3 of registrations (which are themselves perhaps half of demand), to keep losses on those loans lower (and thus taxes on high incomes or public sector borrowing can be lower).

«If your workforce is 55% female you need to more than double it to get the same doctor-years as if it were 100% male»

But to discriminate against women doctors just because they work part time as a lifetime average (but still require a full cost for training) would be politically impossible.

So the obvious solution in the near future is to withdraw state student loans entirely from medical degrees in England, so those who want to work in medicine whether part-time or full time pay for their own training and make their own choices as to whether it is worth then working part-time, and it is up to private lenders to evaluate whether to advance their fees; that's largely the system in the USA, and english tories try to imitate USA customs quite often,

Anyhow there is a nearly unlimited global supply of doctors (etc. including engineers and computing specialists) whose training cost have been paid by the taxpayers of other countries, and so many of them are eager to work in England.

[Blissex]

«China could bolster British growth importantly.
Relations between the countries should be close, no matter American attempts to isolate Britain:»

These arguments are ridiculous, there are two points that mean that the UK oligarchs will obey the USA for a long while:

* At least since WW1 and the subsequent creation of the "Labour Representation Committee", and since WW2 and the subsequent Labour government, the english oligarchs have transferred all their funds to the USA, to put them out of reach of "trots" and "huns" and "cossacks", because the english oligarchs know they don't have the military or police power anymore to defend their wealth themselves.

* Also as to their immovable assets (ancestral palaces, factories, properties, ...) in the UK the english oligarchs rely on the USA military and security services to prevent a "socialist" or "communist" turn of the UK government that might confiscate or tax them away.

Given that the USA have a rather flexible attitude to foreign assets invested in the USA (see russian oligarchs) and their military and security services can be used either to protect the english oligarchs or to regime change them, the english oligarchs are well aware that they totally depend on USA "protection", and that won't change for a long time.

Perhaps one day the PRC will be a safe haven for the funds of english oligarchs, and the PRC military and security services will work to prevent any "socialist" or "communist" turn in England, but unless and until that happens, England will be an obedient USA protectorate.

[Blissex]

«the english oligarchs are well aware that they totally depend on USA "protection", and that won't change for a long time.»

Tony Benn "Diaries" 1965
«Defence, colour television, Concorde, rocket development - these are all issues raising economic considerations that reveal this country's basic inability to stay in the big league. We just can’t afford it. The real choice is — do we go in with Europe or do we become an American satellite? Without a conscious decision being taken the latter course is being followed everywhere.»

"Winston Churchill in the Twenty First Century" edited by David Cannadine, Roland Quinault:
«The irony was, of course, that one of the war aims of the Roosevelt administration was the liquidation of the British Empire, and the expansion of American power and influence at the expense of Britain.
By the end of 1943 it was clear to Churchill that he could no longer rely on American co-operation.»

Churchill to De Gaulle, 1944-06-04, quoted in Jean Lacouture "Le Rebelle" 1984.
«"How can you think that we British would take a position separate from that of the United States? We are going to liberate Europe but it is because the Americans are with us in doing it.
Because every time we must choose between Europe and the open seas, we shall always choose the open seas. And every time I have to choose between you and Roosevelt, I will always choose Roosevelt."»

http://www.telegraph.co.uk/culture/books/non_fictionreviews/3667997/How-victory-spelt-the-end-of-empire.html
«“Churchill was reduced to a subordinate position in the Grand Alliance as early the Teheran Conference in 1943, when he "realised for the first time what a very small country this is". By Yalta in February 1945, he was "weaker than ever before". Roosevelt was concerned with Stalin – he "wasted little time on pandering to Churchill, a vaudeville act with which he was becoming bored". By that time, Clarke writes, "a well-briefed and prudently calculating leader" would have realised "what limited options were realistic [...] for Great Britain as a bantam in a heavyweight league, for the Anglo-American alliance as an expedient relationship premised on subordination”»

Andrew Marr, "History of modern Britain"
«Britain’s dilemma from 1945 until today has been easy to state, impossible to resolve. How do you maintain independence and dignity when you are a junior partner, locked into defence systems, intelligence gathering and treaties with the world’s great military giant? [...] In practice this meant [...] a posture towards American presidents that is nearer that of salaried adviser than independent ally.»

[ltr]

Blissex:

«China could bolster British growth importantly.
Relations between the countries should be close, no matter American attempts to isolate Britain:»

These arguments are ridiculous, there are two points that mean that the UK oligarchs will obey the USA for a long while...

[ As usual, Blissex answers compellingly and importantly.

The point I would make is that all I would hope for is an British economic policy that is not overly and self-deflatingly constrained by American dictates. Britain no longer has a healthy relationship with the EU, and America is not about to let manufacturing escape to Britain, so the trap for Britain has sprung.

I appreciate the fine, fine response. ]

[Blissex]

«the english oligarchs are well aware that they totally depend on USA "protection", and that won't change for a long time.»

How are the mighty fallen... Two quotes that I often gave to "sovereignty is matter of loud declamation and blue passports" delusional brexiters:

Andrew Marr "A history of modern Britain":
«In 1942, as Rommel’s tanks drew nearer, and Churchill was fulminating about Cairo being a nest of ‘Hun spies’, the British ambassador told Egypt’s King Farouk that his prime minister was not considered sufficiently anti-German and would have to be replaced. The King summoned his limited reserves of pride and refused. It was, he insisted, a step too far, a breach of the 1937 treaty.
Britain’s ambassador simply called up armoured cars, a couple of tanks and some soldiers and surrounded King Farouk in his palace. The ambassador walked in and ordered the monarch to sign a grovelling letter of abdication, renouncing and abandoning ‘for ourselves and the heirs of our body the throne of Egypt’. At this royal determination crumbled. The king asked pathetically if, perhaps, he could have one last chance? He was graciously granted it and sacked his prime minister.»

William Rees-Mogg, "The Times", 2006-08-07:
«When Jack Straw was replaced by Margaret Beckett as Foreign Secretary, it seemed an almost inexplicable event. Mr Straw had been very competent — experienced, serious, moderate and always well briefed. Margaret Beckett is embarrassingly inexperienced.
I made inquiries in Washington and was told that Donald Rumsfeld, the Defence Secretary, had taken exception to Mr Straw’s statement that it would be “nuts” to bomb Iran.
The United States, it was said, had put pressure on Tony Blair to change his Foreign Secretary. Mr Straw had been fired at the request of the Bush Administration, particularly at the Pentagon.[...]
The alternative explanation was more recently given by Irwin Stelzer in The Spectator; he has remarkably good Washington contacts and is probably right. His account is that Mr Straw was indeed dismissed because of American anxieties, but that Dr Rice herself had become worried, on her visit to Blackburn, by Mr Straw’s dependence on Muslim votes. About 20 per cent of the voters in Blackburn are Islamic; Mr Straw was dismissed only four weeks after Dr Rice’s visit to his constituency.
It may be that both explanations are correct. The first complaint may have been made by Mr Rumsfeld because of Iran; Dr Rice may have withdrawn her support after seeing the Islamic pressures in Blackburn. At any rate, Irwin Stelzer’s account confirms that Mr Straw was fired because of American pressure.»

And not even from the Prsident, but from subordinates like the NS adviser or the DOD secretary.

What about the UK's legendary nuclear weapons, "ultima ratio regum"? Tony Blair said candidly and clearly:

https://www.telegraph.co.uk/news/politics/Jeremy_Corbyn/12127403/If-Jeremy-Corbyn-were-a-proper-politician-heres-what-hed-be-saying-about-Trident.html
«"The expense is huge, and the utility in a post-Cold War world is less in terms of deterrence, and non-existent in terms of military use.[...] It is true that it is frankly inconceivable we would use our nuclear deterrent alone, without the US"»

Also because the UK SLBMs that would deliver the warheads are owned and controlled by the USA Navy, even if they are hosted from part-UK submarines.

All this to buy USA "protection" of the fortunes of the UK oligarchs.

As to the PRC, I have mentioned before Chairman (of the CMC) Xi's all-important speech published in Qiushi 2 years ago:

http://en.qstheory.cn/2021-07/08/c_641137.htm

where my understanding that he wrote that while the PRC so far has benefited from globalisation and will try to continue to do so, it is clear that era is ending and the PRC must prepare for a cold war among separate trade and security blocks.

At one point David Cameron accepted the chairmanship of the BRI investment fund, and the UK oligarch tried to trade with both PRC and USA; that was when the USA oligarchs still thought that the PRC was one of their vassal, too dependent on exports to the USA and oil and raw materials imports from USA controlled countries to ever dare to slip the leash, and the USA tolerate trade among vassals.

BTW not only the UK oligarchs totally depend on USA "protection" of their fortunes, the whole country also depends on USA "protection" for its imports of fuels, cereals, etc. along sea routes completely controlled by the USA Navy, like most european countries also do.