Why is nobody interested in the real reasons Blair is wrong? Thoughts on responses to that essay.

Somewhere out there is a free market response to Blair, one that says yes to his globalism but rejects his big state techno-oligopoly.

There has been a veritable avalanche of proposals for the salvation of Britain. All prompted by Tony Blair who presents what he called the politics of the future in a long-winded argument that because of AI everything must change:

“And is it right that we’re living through the 21st-century equivalent of the 19th-century Industrial Revolution and if so, are we remotely meeting the scale of that challenge? And what are the opportunities in areas like health and education for transformative change consequent on this revolution and the existential dangers of this revolution when, quite soon, someone sitting in their front room could hack into vital national infrastructure and bring it down?”

Some have argued (not without merit) that Tony Blair, having taken a quarter of a billion dollar donation from Larry Ellison the owner of Oracle, is more or less duty bound to make the case for policy changes designed to suit billionaire owners of big tech businesses. But this doesn’t mean that Blair is wrong to make arguments for a refocus on energy abundance and a liberalised planning regime (at least for technology infrastructure, Blair famously has a housing crisis blind spot). If the position for Britain is to embrace the AI revolution with all its warts or else fall behind and risk further relative economic decline, then these policy changes really are necessary. Blair makes an eloquent case for what he calls the “radical centre”, essentially a sort of techno-oligopoly, a more benignly capitalist version of Aaron Bastiani’s ‘fully automated luxury communism’.

Some reading the article tell us about the things that Blair gets right (scrapping net zero, reforming planning, reaffirming the close relationship with the USA, not relitigating Brexit) and use them as a stick to beat the men fighting over the decaying carcass of the Labour Party. But in doing this we miss what Blair gets wrong. Most notably Blair’s argument makes a presumption that the success of his techno-oligopoly depends on what he calls ‘partnership’ between industry, commerce and the government. But Blair insists that this partnership is primarily about AI (see above for his funders) and that it is all about managing the state not boosting the economy:

“Most important of all, reorganising the whole of government around the harnessing of the 21st-century technological revolution. All governments for the foreseeable future will govern in the age of AI. Those which understand it will see their countries prosper; those which don’t, won’t. This is literally the challenge across all sectors including welfare and health (digital ID is just one, though vital, part of it). It will define the future of the British economy which, ironically, has a powerful position in technology but one we’re in danger of squandering.”

The responses from Andy Burnham and Keir Starmer have been, in different ways, to reject Blair’s arguments. Burnham (and more sotto voce Wes Streeting) says the problem is inequality and the legacy from 40 years of ‘neoliberalism’. Every problem Blair describes (and some he doesn’t such as the 2008 financial crash) was a consequence of failed regulation. And this regulatory failure resulted from us being altogether too soft and laissez faire. Dare I say it, too Blairite. Burnham parades Manchester’s modest, largely property- and services-driven economic success as evidence despite him having little to do with the drivers of this growth. The growth mainly comes from good fortune, enterprising Mancs, liberal planning allowing rapid city centre development, the relocation of the BBC and the consolidation of the North West’s legal, consultancy and accountancy businesses in the city. Burnham just rode this wave.

Sir Keir Starmer’s response turned out to be a pretty robust defence of his choices and leadership in government. As with Burnham, Sir Keir dismisses Blair’s arguments as being out-of-touch and unpopular. There was no engagement with the principle ingredient of Blair’s proposals, the AI ‘revolution’. Probably because, right now, people either see AI as a cutesy internet tool (all those drearily twee cartoons) or else as something that is going to kill their job. For the millions of public sector workers who make up the core of the Labour vote and provide most of its activists, talk of “...reorganising the whole of government around the harnessing of the 21st-century technological revolution…” isn’t talk of better government but signals a redundancy notice at some point in the near future.

The Labour Party isn’t going to adopt Blair’s radical centrism, especially when it reeks of American tech billionaire interests. Instead, regardless of whether Burnham replaces Starmer as leader and PM, we’ll see another shift leftwards. The Burnham agenda of nationalising water, subsidising buses and borrowing money to build a few council houses will become the strategy as the party hopes that Tory immigration reforms will eventually reduce net migration. And, as the Trump era comes to an end, the world’s economy will breathe a sign of relief and start to grow a little. In Britain a mild uptick in the economy will be presented in triumphal terms as vindication of Labour’s reforms and, echoing a decade of French politics, the Party’s electoral strategy will feature a special fear whipped up about Reform and the ‘far right’.

The most striking thing about Burnham’s reply to Blair’s essay is its parochialism. In his response, Burnham returns to arguments about local protectionism and state investment rather than engaging with the globalism of Blair’s essay. All three men fighting over the somewhat tarnished Labour crown seek (and in doing so reflect what is probably the majority view of Labour Party members) to pull away from engagement with the global economy - except for the diminishing part of that global economy represented by the EU - and prefer to talk about inequality, state control and industrial strategy. What’s most striking about these positions is how close they are to those favoured by national conservatives and, in as much as it has one, Reform UK economic policy.

The outcome of this debate hasn’t been an active discussion of the social and economic choices created by the “21st century technological revolution” but rather a retreat back into trite arguments about “40 years of neoliberalism” and how we can’t allow the markets to dictate the economy. Even Blair’s odd endorsement of multipolarity while arguing for closeness with the USA received little attention except in respect of Britain’s relationship with the EU. Nobody, moreover, hinted that Blair’s obsession with digital ID, biometrics and social media controls might not be conducive to an effective long-term relationship between Britain and the USA, home to the businesses leading this technological revolution. Instead we’re talking again about nationalising water supply, a failed attempt to use state direction to make bus travel economic, and a sort of social model for public procurement that amounts to little more than localised protectionism.

Nobody raised an eyebrow at Blair’s promotion of gulf state and Saudi interests given that these are also important clients of his institute. Or indeed asked questions about the active engagement strategy with China that Blair promotes. Above all the only alternative to Blair’s AI strategy is one of greater control and regulation, a fearful approach that parallels the approach of the EU. Indeed Blair, rather than seeing new technology from a laissez faire perspective, presents the benefits of AI and LLMs as lying in reforming the state and social control rather than in creating new opportunities for commercial and business innovation. Britain has real opportunities in AI application to fields like life sciences, financial technology, leisure, gaming, and health that our sclerotic and often obstructive state makes more difficult. This isn’t simply a matter of letting developers build data centres but of stepping back from the sort of planning driven economic strategy that Blair advocates. Burnham, Streeting and Starmer want to concentrate on distributing the pie while supporting Blair’s essentially statist approach. Streeting posts a video talking about wealth taxes while Burnham and Starmer babble about social justice.

Somewhere out there is a free market response to Blair, one that says yes to his globalism but rejects his big state techno-oligopoly. But so far all we’ve had is Burnham rediscovering the failed policies of 1970s Britain, Starmer proclaiming the merits of his regulatory, lawyer-led state, and Streeting trying to be a less zany version of Zack Polanski. A better plan - ideally a plan to have less planning - would be welcome. This from Kemi Badenoch is a start but I hope she is listening to herself when the arguments for social control are made, often with tears and pain.