“Social democracy is as much about a successful market economy as it is about an active state. When Labour forgets the first part of that sentence, we and the country lose. We’ve got to be as focused on wealth creation as we are on wealth distribution.” These words by Wes Streeting, former secretary of state for health in the Labour government, appeared in the FT last week. This is the right approach.
Unfortunately, data from the Conference Board shows that in 2025, the UK’s real output per head was 27 per cent smaller than it would have been if the 1970-2007 trend had continued. “Degrowth” Greens should cheer. But just look at how happy this is not making people. Economic growth is a precondition for almost everything. It was a necessary condition for the birth of the UK’s liberal democracy in the 19th and early 20th centuries. Today, it is a condition for its survival.
There are many reasons, no doubt, why Sir Keir Starmer’s government has become so unpopular. My colleague Robert Shrimsley blames it, plausibly, on a lack of hope. But hope must be grounded in reality. After almost two decades of disappointment, many people have given up on it. This is part of the reason why rage plays such a big role in today’s politics. As I have argued in recent columns, it is now even putting the UK’s political stability in danger.