Trump as Nemesis
Britain must find a new path through the ruin of hyper-liberalism's hubris
Towering columns
In the New Statesman, John Gray examines how the overreach of hyper-liberalism in America brought about the revival of Trump.
At present, liberalism is not so much a political philosophy as a chronic form of cognitive dissonance. It seems progressives lack the capacity to learn from experience – which is the necessary precondition of progress. The psychological shock Trump’s triumphant return has inflicted on them will be profoundly dislocating – far more so than that of Brexit, which unhinged so many. Oscillating between paroxysms of grief at their injured virtue and unconvincing professions of invincible hope, they preserve their sanity by denying the mortifying truth. The world they made and thought they understood is irretrievable, and it was they who lost it.
Rather than acknowledging the origins of post-liberal America in the ravages of liberal globalisation, they dismissed the communities it destroyed as redoubts of white privilege. Adopting radical positions on transgender issues outraged traditionalist defenders of the family and confirmed the realignment of American workers and ethnic minorities with the Republican Party, while alienating classical feminists and defenders of gay equality. One reason Trump’s victory was so sweeping is that the liberalism on which he waged war is so relentlessly crankish. Hillary Clinton was almost conservative in comparison.
The reaction to the election has revealed progressive elites possessed by myths. For many who opted for him, their vote was a considered choice between conflicting interests, values and dangers. (The same is true of many who voted for Harris.) For hyper-liberals, the election was an apocalyptic struggle between darkness and light. In an age of scientism, it was predictable that they should turn to numbers for reassurance that the battle could be won. With all their high-tech mathematical models, the pollsters proved no better oracles than they were in 2016. The hosts of “knowledge workers” mass-produced by ideologically captured universities were exposed as knowing nothing. The future of this class is bleak.
At UnHerd, Tom McTague considers how Jeremy Clarkson’s popularity could signify the beginnings of a right-wing counter-culture in Britain.
To watch even a few episodes of his hit show Clarkson’s Farm is to immediately realise that while it contains much of the energy of Top Gear, at heart it carries a far more profound message than the populist caricature he usually does little to disavow. Essentially, Clarkson’s Farm tells us that farming must be protected in a collective national endeavour because it provides our life source: food. It is elemental: an expression of an old, almost forgotten Toryism — not free-trade but protectionist, national, territorial and utterly opposed to centralising notions of uniformity.
The programme overlaps with other expressions of Toryism too: inheritance, obviously, but also questions of conservation and an instinctive opposition to a distant, bureaucratic state. Occasionally, as a viewer, you are suddenly struck by the sensation that Clarkson is quietly delivering a sermon on rural life, smuggled into your living room under the guise of an entertaining countryside farce, a Tractor Top Gear…
…Clarkson represents the national system; Starmer and Reeves the philosophical one. If I were Starmer, I would be worried that this is the wrong side to be on today, especially in this era of Trump. Clarkson’s politics, it seems to me, are like T.E. Utley’s self-professed brand of Toryism: “at once traditionalist and populist, which holds sway in every public bar in the kingdom and is almost entirely denied parliamentary expression by the Establishment”. Just because Clarkson’s politics do not map onto the prejudices of the two main parties today — being neither pro-European nor pro-global free trade — does not invalidate them, but rather, potentially, elevates them.
At The Critic, Doug Stokes believes the end of American unipolarity has ushered in an age of sovereigntist internationalism.
National governments have ceded authority to supranational bodies like the European Union, the International Monetary Fund, or even non-governmental organisations that operate beyond the reach of voters. Elections seemed to change little; the same policies — open borders, neoliberal economics, cultural repudiation — persisted regardless of who was in power. The result was a growing sense that democracy had been hollowed out and reduced to a performative ritual. To question this democratic deficit was to place oneself outside the progressive arc of history: gammons, deplorables, garbage.
For all his flaws and dysfunctions, Trump has served as a catalyst — forcing the old establishment to confront its contradictions. His presidency underscores the emergence of a new paradigm where sovereignty, national interest, and the desire to be free from technocratic control increasingly take precedence. Crucially, this shift should not be viewed merely through the simplistic lens of left vs. right; rather, it is best understood as a more fundamental moment — a quasi-spiritual reckoning for the West, grappling with the kind of moral order that will define its future.
This conflict pits two competing visions against each other: on one side, an authoritarian framework — a top-down, imposed order championed by a transnational, anti-democratic administrative state; on the other, a resurgence of sovereignty, a defence of human agency, and a return to the values of freedom and self-determination. As articulated through these movements, sovereign internationalism attempts to redefine international engagement by affirming national interests and independence rather than subjugating to unelected global bureaucracies.
At The Spectator, Rupert Darwall argues that the hollowing out of the Cop summit has demolished the economic case for Britain’s climate targets.
The choice of Azerbaijan to host the talks was always going to be challenging. Being an oil producer did not disqualify Dubai from skilfully running last year’s Cop. But the brutal ethnic cleansing of Nagorno-Karabakh last year and President Ilham Aliyev’s long-standing denial of the Armenian genocide proved too much even for a UN climate conference where white-washing and hypocrisy are the order of the day. Ironically, it was the Paris Cop21 in 2015 – widely seen as the crowning achievement of the UN climate talks – that drained the drama from all subsequent Cops.
Under the Paris climate agreement, the process moved from countries sitting around the conference table negotiating emissions targets to countries submitting their own targets – or deciding not to have any targets at all – in the form of five-yearly Nationally Determined Commitments (NDCs). Unsurprisingly, the Paris agreement failed to bring about a peaking of global greenhouse gas emissions. In 2015, global emissions of carbon dioxide were 35.4 billion tonnes. In 2023, they had risen to 37.79 billion tonnes – an increase of 6.75 per cent – with little sign, despite the UK and EU delivering massive emissions reductions, that global emissions are close to peaking…
…These developments left Keir Starmer looking an increasingly forlorn figure at Baku, where he presented Britain’s NDC for 2035, which would see an 81 per cent cut in emissions. ‘Our goal of 1.5C… Is aligned with our goals for growth,’ the Prime Minister declared. In just 11 words, the Prime Minister shows himself doubly deluded. The following day, Oslo-based climate researcher Glen Peters said that the remaining carbon budget to limit warming to 1.5C is ‘so small that it almost makes no sense anymore.’
At CapX, Alex Chalmers reflects on why Britain needs an effective technology policy that removes barriers to scale.
Structural barriers to scale – like the high cost of energy, limited lab space, broken procurement, regulatory sluggishness, and predatory behaviour from universities towards entrepreneurs – all go ignored. Instead, the government has channelled billions of pounds into subsidising the UK technology sector over the past two decades. It is the single biggest investor in UK venture capital funds and ‘growth-stage’ technology companies. On top of this, hundreds of millions of pounds is distributed to fund ineffective NGOs, support low value innovation programmes or prop up zombie companies. This is expensive displacement activity. Micro tech interventions are usually politically uncontroversial and provide regional photo-ops. While the cumulative cost to the taxpayer is high, individual initiatives are cheap, making them ‘easy’ to fund. If this is so ineffective, why do governments do it?
Firstly, there is an ideological bias. To go Thatcherite, there is no such thing as UK tech. There are only individual companies. Only a handful of these can win. This jars with both Westminster and Whitehall. The former believes that any British business is axiomatically ‘world-leading’, while the latter is fixated on ensuring growth is distributed as broadly as possible. Rather than allowing bad businesses or incompetent investors to fail, so talent and capital can be recycled, they’re kept alive to counter imaginary ‘market failures’.
The second malaise is ‘stakeholderism’. Lack of in-house expertise results in policymaking by a committee of vested interests. Policy around technology finance is determined by polling the current or potential recipients of public money – and they always want more. For example, the driving force behind the creation of a multi-billion pound British Patient Capital fund was a review that heavily consulted venture capitalists and asset managers who stood to benefit. Finally, it’s easier to focus on funding than it is on structures. Given the choice between the pain of building out the UK’s nuclear infrastructure to power data centres or the ease of launching a new regional growth fund – the median politician will pick the latter.
In the Wall Street Journal, Bojan Pancevski looks at how Western European cities have become less safe for Jewish communities.
Statistics show that anti-Jewish violence has been on the rise in Western Europe for a decade, but it has surged since Hamas’s attack on Israel on Oct. 7, 2023, and Israel’s retaliatory invasion of Gaza. In France, the number of antisemitic incidents increased from 436 in 2022 to 1,676 in 2023, while physical assaults, including stabbings, nearly doubled from 43 to 85. Antisemitic incidents in the U.K. rose from 1,662 to 4,103, with physical attacks increasing from 136 to 266. Only a fraction of such incidents are reported to the police or community agencies, according to the Institute for Jewish Policy Research, a British nonprofit…
…Josef Schuster, head of the Central Council of Jews, Germany’s largest Jewish organization, said Western Europe was suffering an eruption of anti-Israeli and purely antisemitic violence. While in the past antisemitic violence came from the far right, he said, it now comes much more from left-wing extremists and Islamists: “Israel’s conflicts with Hamas, Hizbollah or Iran seem to rile up the migrant communities.” According to an official EU survey conducted in 2023 before the Hamas attacks, 50% of the victims of antisemitic physical attacks in the EU reported that the perpetrators had Islamist extremist views, up from 30% in 2018. Another 22% had left-wing extremist views, while 17% had right-wing extremist views…
…More than a third of Germans hold antisemitic views, according to a 2022 poll, but the proportion is twice as high among Muslims in the country. In 2023, Germany saw 148 violent antisemitic crimes, up from 88 the year before. Over half of German Jews have considered emigrating in the past five years for reasons related to being Jewish, according to a recent EU survey. France and Belgium have seen tens of thousands of Jews emigrate to Israel in recent years.
Wonky thinking
Policy Exchange has published Semiconductors: A test for the new Government by Sir Geoffrey Owen, their Head of Industrial Policy and the former Editor of the Financial Times. Sir Geoffrey makes the case for building an open access foundry for compound semiconductors. This would boost one of Britain’s existing strengths and catch up with European competitors in France, Italy, Germany, and the Netherlands.
The government’s options are constrained, as they were for its predecessor, by the fact that UK-based companies have largely withdrawn from the high-volume production of silicon chips. There is no large, broad-based semiconductor manufacturer comparable to the three leading European companies: Infineon in Germany, NXP in the Netherlands, and the Franco-Italian group, STMicroelectronics. All three of these companies are building new European fabrication plants, helped by government subsidies under the European Chips Act.
Even if the UK wanted to move in the same direction, there is no manufacturing base on which a larger industry could be built. In examining why semiconductor production has declined more steeply in the UK than in other European countries, this paper puts some weight on the lack of consistency in government policy towards the industry, especially in the period between the 1970s and 1990s. But it also notes that government support in Germany did not prevent Siemens, the country’s principal semiconductor firm, from running into financial problems at the end of the 1990s, prompting the company to withdraw from the industry.
The survival of the three European companies has been due not so much to government support as to their ability to identify and exploit opportunities in sectors of the market which are less directly exposed to Asian competition. Some of these opportunities lay in European industries, notably the automotive industry, which have provided a large market for European-made chips and served as a base for supplying global markets, especially in Asia; China’s fast-growing car makers have become important customers.
The UK cannot hope to replicate what the European firms have done, but there is an opportunity, not in silicon chips, but in compound semiconductors. Devices based on these materials, which include silicon carbide and gallium nitride, are increasingly replacing or supplementing silicon in a range of applications, because of their low power consumption and other advantages. The UK already has competitive strengths in this part of the industry, but there is a missing ingredient: an open access foundry which could play the same sort of role for firms that design or make compound semiconductors as silicon-based foundries play in Europe, the US and Asia.
Such a facility would almost certainly need government support, but it should also attract investment from semiconductor design firms and from compound semiconductor users. It could be built on a greenfield site, or adjacent to an existing fabrication plant. If the government decides to support such a venture, it needs to do so on a sufficient scale, and on the basis of a long-term commitment. One clear lesson from the semiconductor story set out in this paper is that it is better for governments not to intervene at all than to do so half-heartedly or intermittently.
The Institute for Fiscal Studies has published Household responses to trade shocks by Aitor Irastorza-Fadrique, Peter Levell, and Matthias Parey. Their working paper investigates the impact of Chinese import competition on households and workers in England and Wales during the early 2000s following China’s entry into the WTO. They found that the trade shock had significant consequences for the British labour market and manufacturing sector.
Our analysis exploits the rapid increase in Chinese exports surrounding China’s entry into the WTO in December 2001. This increase has been attributed to several factors including lowered tariffs on imported inputs, the end of international import quotas under the Multi Fibre Arrangement (MFA), a reduction in trade uncertainty, and continued rapid Chinese productivity growth during this period (see, e.g. Pierce & Schott, 2016; Handley & Limao, 2017; Amiti et al., 2020).
Figure 1a shows the timing and scale of the rapid increase in Chinese imports to the UK. Most of this increase occurred in the 2000s. During this time, the share of the UK’s total imports coming from China almost doubled, and the real value of imports from China increased from approximately £20 billion in 2001 to around £50 billion in 2011. Imports were concentrated in low-tech manufacturing (e.g. the manufacture of games and toys; luggage and handbags; footwear; leather), consistent with China’s comparative advantage in labour-intensive activities during this period (Amiti & Freund, 2010). Table A.1 lists the 20 industries most affected by import competition between 2001-2011.
Figure 1b shows that this increase in imports was accompanied by a decline in manufacturing employment that occurred almost entirely within our period of analysis (2001- 2011). This decline was focused on the most trade-exposed industries, whose employment declined by 45 percentage points between 1993 and 2011 compared to 32 percentage points for the least trade-exposed manufacturing industries. Figure 1b also shows that the faster decline in employment among the most trade-exposed industries that occurred during our sample period was not due to the Great Recession of 2008-09 (highlighted in grey), but rather occurred in the period before 2007 when import competition from China was rising steeply. The impact of the recession itself on manufacturing employment was similar across more and less-trade exposed manufacturing industries…
…We find that men in households exposed to import competition respond by increasing labour force participation at older ages, and by moving into self-employment. This is true both in response to their own import exposure, and when their female partner is exposed to the shock. We do not find evidence for these responses among women, who do not increase labour supply if their male partners were initially employed in exposed industries. Self-employment plays an important role in accounting for the difference in responses across genders. Those working in the self-employed sector are more likely to be in maledominated occupations, and these appear to provide men exposed to import competition with an employment buffer. Similarly, male-dominated occupations account for almost the entire increase in self-employment among men responding to shocks affecting their partners.
Our results show that partners provide insurance against negative labour market shocks stemming from import competition. However, the nature of this insurance depends on the gender of those affected. One implication of our findings is that the impact of future shocks is likely to depend on the gender composition of workers in affected industries. A second implication is that single-headed households affected by a shock may be in greater need of public insurance.
Book of the week
We recommend Technology and the Rise of Great Powers: How Diffusion Shapes Economic Competition by Jeffrey Ding. The author provides an account of how technological revolutions have fundamentally shaped the ebb and flow of geopolitical rivalry throughout history. This interplay of forces relies on how well states are able to harness technology to their own benefit. Learning the right lessons will decide the outcome of US-Chinese competition as new technologies around artificial intelligence develop and change the world.
At present, the United States is better positioned than China to develop the skill infrastructure suitable for AI. First, the United States has more favorable conditions for expanding the number of AI engineers. According to three separate projects that mapped out the global AI talent landscape, many more AI engineers work in the United States than in any other country. In 2017, Tencent Research Institute and BOSS Zhipin (a Chinese online job search platform) found that the number of AI “practitioners” (从业者) in the United States far surpassed the corresponding Chinese figure. Figure 7.2 captures this gap across four key AI subdomains: natural language processing (by three times), chips and processors (by fourteen times), machine learning applications (by two times), and computer vision (by three times). Overall, the total number of AI practitioners in the United States was two times greater than the corresponding figure for China. Furthermore, data from two separate reports by LinkedIn and SCMP Research confirm that the United States leads the world in AI engineers.
In addition to statistics on the AI workforce, the quantity and quality of AI education is another consideration for which country is better positioned to develop GPT skill infrastructure for AI. Again, the United States leads China by a significant margin in terms of universities with faculty who are proficient in AI. In 2017, the United States was home to nearly half of the world’s 367 universities that provide AI education, operationalized by universities that have at least one faculty member who has published at least one paper in a top AI conference. In comparison, China had only 20 universities that met this standard. After replicating this methodology for the years 2020–2021, the US advantage is still pronounced, with 159 universities to China’s 29 universities.
These findings contradict prominent views on the present global distribution of AI engineering talent. In his best-selling book AI Superpowers: China, Silicon Valley, and the New World Order, Kai-Fu Lee argues that the current AI landscape is shifting from an age of discovery, when the country with the highest-quality AI experts wins out, to an age of implementation, when the country with the largest number of sound AI engineers is advantaged. In an age of implementation, Lee concludes, “China will soon match or even overtake the United States in developing and deploying artificial intelligence.” Pitted against the statistics from the previous passages, Lee’s evidence for China’s lead in AI implementers is meager. His attention is concentrated on anecdotes about the voracious appetite for learning about AI by Chinese entrepreneurs in Beijing. While this analysis benefits from Lee’s experience as CEO of Sinovation Ventures, a venture capital fund that invests in many Chinese AI start-ups, it could also be colored by his personal stake in hyping China’s AI capabilities.
Drawing on Lee’s book, Allison and Schmidt also assert that China is cultivating a broader pool of AI talent than the United States today. Specifically, they point out that China graduates three times as many computer science students as the United States on an annual basis. Yet the study on which this figure is based finds that computer science graduates in the United States have much higher levels of computer science skills than their Chinese peers. In fact, the average fourth-year computer science undergraduate in the United States scores higher than seniors from the top programs in China. Therefore, estimates of China’s pool of AI engineering talent will be misleading if they do not establish some baseline level of education quality. This is another reason to favor the indicators that support an enduring US advantage in AI engineers.
Second, as previous industrial revolutions have demonstrated, strong linkages between entrepreneurs and scientists that systematize the engineering knowledge related to a GPT are essential to GPT skill infrastructure. In the AI domain, an initial evaluation suggests that this connective tissue is especially strong in the United States. Based on 2015–2019 data, it led the world with the highest number of academic-corporate hybrid AI publications—defined as those coauthored by at least one researcher from both industry and academia—more than doubling the number of such publications from China. Xinhua News Agency, China’s most influential media organization, has pinpointed the lack of technical exchanges between academia and industry as one of five main shortcomings in China’s AI talent ecosystem.
These preliminary indicators align with assessments of the overall state of industry-academia exchanges in China. Barriers to stronger industryacademia linkages include low mobility between institutions, aimless government-sponsored research collaborations, and misguided evaluation incentives for academic researchers. One indicator of this shortcoming s the share of R&D outsourced by Chinese firms to domestic research institutes: this figure declined from 2.4 percent in 2010 to 1.9 percent in 2020. Over the same time period, the share of Chinese firms’ R&D expenditures performed by domestic higher education institutions also decreased from 1.2 percent to 0.4 percent.
Moreover, the US approach to AI standard-setting could prove more optimal for coordinating information flows between labs working on fundamental AI advances and specific application sectors. Market-mediated, decentralized standardization systems are particularly suited for advancing technological domains characterized by significant uncertainty about future trajectories, which clearly applies to AI. In such fields, governments confront a “blind giant’s quandary” when attempting to influence technological development through standardssetting. The period when government involvement can exert the most influence over the trajectory of an emerging technology coincides with the time when the government possesses the least technical knowledge about the technology. Government intervention therefore could lock in inferior AI standards compared with market-driven standardization efforts.
In that light, China’s state-led approach to technical standards development could hinder the sustainable penetration of AI throughout its economy. For example, the Chinese central government plays a dominant role in China’s AI Industry Alliance, which has pushed to wrest leadership of standards setting in some AI applications away from industry-led standardization efforts. Excessive government intervention has been a long-standing weakness of China’s standardization system, producing standards not attuned to market demands and bureaucratic rivalries that undermine the convergence of standards. Wang Ping, a leading authority on this topic, has argued that China needs to reform its standardization system to allow private standards development organizations more space to operate, like the Institute of Electrical and Electronics Engineers in the United States and the European Committee for Electrotechnical Standardization.
Quick links
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