Why liberals fear democracy

Elite culture and consensus economics have alienated the majority

Towering columns

For The Critic, Adrian Pabst looks at why consensus economics will not save Britain from years of stagnant growth:

Disparities of income and assets are widening. As power and wealth become more concentrated, Britain is an increasing patchwork of elite enclaves enclosed within a vast wasteland of neglected ex-industrial towns and former mining villages strewn across rural and coastal areas. By uncritically embracing globalisation and the knowledge economy, successive governments have failed millions of people.

Yet the British crisis goes even deeper than in the 1970s as dysfunctional markets lack productive capacity and the state lacks institutional capacity. In terms of the national economy, we don’t own much and we don’t make nearly enough – housing, high-tech manufacturing, medical supplies or indeed babies.

Instead, the UK economic model resembles a vast rentier system built on a property market powered by the City of London and fuelled by foreign capital. London is at the heart of a power nexus running from Silicon Valley via Wall Street and the Middle East all the way to nominally Communist China. For all the strengths of the City, life sciences and gigafactories, the volume of financial transactions is inversely related to the generation of value. We need fewer speculative bubbles that enrich the rentier class of domestic and foreign oligarchs. And we need more goods and services that foster economic security and flourishing, with decent, properly paid jobs that give people not just an income to pay the bills but a sense of purpose and fulfilment.

In UnHerd, Fred Skulthorp discusses his visit to Northstowe, the largest new town to be built since Milton Keynes, and what its shortcomings mean for the future of Cambridge development expansion:

Something of an answer lies in the last time the country was forced to build at scale. The post-war building boom was unprecedented in Europe, creating 22 new towns that became home to 2.7 million people. Northstowe’s predecessor, Milton Keynes, now feels like an infrastructural marvel from a more confident age, the post-war equivalent of the Victorians’ Crystal Palace. It was conceived in 1967, progressing (unlike Northstowe) through the austerity of the Seventies to offer its new population an idiosyncratically English hodgepodge of the garden city movement and the car-friendly suburban utopias of Fifties America. Its legacy has always attracted a seam of snobbery: a “bland kitsch, Thatcherite reality”, wrote the architecture critic Owen Hatherley, “the non-place it was planned to be”. Despite this, Milton Keynes grew and grew, and has become one of Britain’s most economically successful cities. Now, by way of grim irony in 2023, both the scale of its conception and the pace of its execution seem a much needed luxury.

No surprise, then, that the Milton Keynes “development corporation” model has been invoked by both parties in their attempts to confront housing, the Tories in 2018 and Labour earlier this year. But such a model demands a vision beyond mere house numbers. And this is what haunts Northstowe. Unlike Milton Keynes, the fact that it is “driven by developers”, as one councillor told me, has left it open to the vagaries of Britain’s long-term economic malaise. The pandemic has been widely blamed by developers for slow operation, but this didn’t prevent Savills gushing in November 2021 that the site of a town centre represented a “significant milestone”. But two years on and there is still nothing that might offer a sense of place or identity. A tangle of contracts and obligations compels developers to wait for houses to sell before delivering on promised infrastructure and facilities in stages (dependent itself on “market conditions”). Let them come, then build it, is the future of Northstowe.

Amid the Yimby call for housing at any cost, this model poses a warning, accentuated by the proximity and symbolic contrast between Cambridge and Northstowe. The former, a city trying to escape stagnant Britain via an Anglo-futurist mix of historical prestige, accelerated building and scientific innovation. The other: already more of a relic than Cambridge’s honey-gothic landmarks, tethered both spiritually and contractually to a decade of economic stagnation and political amnesia. A visionary piece of planning that has turned into a housing estate without a pulse or purpose.

In Compact, Greg Conti claims elite liberals fear democracy because ordinary voters tend towards conservatism:

A true democracy not only suffers, but encourages, “coarse and vulgar people” to enter the public arena. Indeed, it is almost the definition of the spirit of a living democracy that it does not tell “the poorly educated” (as Trump called them) that they can come back and be heard only after they’ve mastered the new catechism. (And it certainly does not accept that they might lose their jobs for lack of such mastery). Frequent, top-down cultural change will always have unequal effects, putting the many at a greater distance from public debates and making it harder for them constructively to challenge the determinations of their major institutions, let alone to enter these institutions themselves.

It seems hardly a coincidence that the period of breakneck cultural transformation through which we have been living has coincided with a rise in economic inequality, a growing disaffection with the central institutions of state and civil society, and survey results consistently showing a loss of faith in democracy. The latter, I suspect, might best be interpreted as indicating not that citizens no longer believe in the democratic ideal, but that they hardly feel they live in real democracies any more.

Furthermore, there is the truth—not invariable, of course, but a decent empirical regularity—that the elite is more proactive about pushing for cultural change than the masses. The historical record exhibits a greater attachment to traditions and customary ways from ordinary people than from intellectuals and professionals, except in some rare moments of revolutionary fervor—but the trouble with revolutions is that, once the upheavals get going, these tend to become the very times at which genuine public opinion has the least chance of being heard.

In the Daily Telegraph, Martin Howe says ECHR withdrawal is necessary if we are to take back control of our borders fully.

It is worth asking how we have got to this position. The ECHR itself does not contain any rights to asylum. This is not an accident. Instead, rights to asylum were covered in the Geneva Refugees Convention, which was drafted in parallel by very much the same group of countries. 

But the European Court of Human Rights decided a series of cases which held states responsible for what happens to people outside their borders if they are expelled, despite the words of the Convention which only require states to secure the convention rights to people “within their jurisdiction”. This case law expanded so that a mere risk, rather than a certainty or probability, that someone would be subjected to treatment contrary to Article 3 was sufficient to bar their removal. Nor were states allowed to take into account the risk of harm to the host country, for example from suspected terrorists. All this Strasbourg case law was cemented into UK law by Tony Blair’s Human Rights Act, leading to the woeful state of affairs we face today. 

This is only one of the many doctrines which Strasbourg judges have invented over the years and pasted on to the original Convention under the guise of “interpreting” it. For example, the Strasbourg court has held (again contrary to its words) that the Convention extends outside the territory of its member states and applies to military operations abroad, subjecting our armed forces to the risks of “lawfare”. Judges should not be lawmakers, a task for which they have no democratic legitimacy and often very little aptitude. Rule by judges according to rules they make up themselves is the opposite of the rule of law. Yet we have supinely allowed ourselves to be subject to these legal doctrines and rules which we never agreed to in the first place. 

For The Times, James Kirkup argues that raising tuition fees is the most effective way of improving the quality of university courses and research:

Tuition fees for domestic students have been fixed since 2017 and inflation means their real value is down more than a quarter. The shortfall will worsen further because fees are capped until at least 2025. This has other baleful consequences.

It encourages universities to steer British students towards courses that are cheaper to teach and away from the expensive lab-based courses that politicians, rightly, want to see more of. It leads some to cut back on novel, costly research. It means more remote and online teaching, leaving some students feeling isolated and unsupported. It means that academic pay falls and workloads rise. That has led to industrial action which, scandalously, left some students unable to graduate this summer.

The overall result is a sector that offers its domestic customers an increasingly poor product. Which is why some of the most mobile customers are looking elsewhere. At private schools in London — among the keenest analysts of educational advantage — head teachers don’t just boast to parents about how many pupils they send to Oxbridge and the Russell Group. They talk about how many children went to US universities, often on generous scholarships, and how many became apprentices at big employers such as KPMG and the BBC.

In an interview with the Daily Telegraph, Tom Holland covers his new book Pax: War and Peace in Rome’s Golden Age, and the forces driving the new history wars in our culture and education system:

With debates raging about “decolonising” schools and museums, activists tend to focus on another great empire: Britain’s. Holland is insistent these arguments should not be applied to his book, contending that the Romans wouldn’t have even understood the term. His previous book, Dominion, delves into how the West is moulded by a Christian tradition, which has provided the moral lens through which we observe both current and past events.

Holland says we cannot use this lens to examine the Romans, who operated on an entirely different set of beliefs and philosophies. He says Christianity “has transformed our understanding so utterly that when we look back at the pre-Christian world, it’s as though we’re looking at a glass darkly”. “The Roman attitudes to empire, which are complex, ambivalent, sophisticated, but are not shaped by the Christian assumptions that I think determine how we see empire.”

Holland views contemporary debates around rewriting history through a moral gaze, with good guys to be celebrated and bad guys to be cancelled, as a thoroughly Christian discourse. There is a paradox in the culture war, he argues, saying “that the current iteration of Christian culture is, by its own self estimation, an attempt to purge itself of Christianity; that it is anti-Christian for very Christian reasons.”

When pushed on his own views on so-called “woke” history, his answer is nuanced yet firm. “I personally don’t think that the arc of history bends toward justice,” he says. “I don’t think that there are right sides of history. But it’s important for our age because it’s a very moral age and it needs moral lessons that history be made to teach those lessons, I mean, I think that’s a fool’s errand myself, but I can see why people do it.”

Wonky thinking

The National Institute of Economic and Social Research has published its UK Economic Outlook Summer 2023, forecasting that the UK in on track to lose five years of economic growth. They also predict a 17 percent shortfall in the real disposable incomes of households in the bottom half of the income distribution in the period 2019-2024:

The series of shocks that hit the UK economy over the past few years – from the uncertainty over Brexit via Covid-19 to the spike in inflation following Russia’s invasion of Ukraine – has exacerbated underlying structural weaknesses and disparities of wealth. With slow growth, low investment, flatlining productivity as well as gaps in the provision of skills and finance, real disposable incomes and living standards have fallen across the income distribution. This applies notably to households at the bottom end who experience food insecurity and fuel poverty, and who are drawing down their savings or going further in debt (Bhattacharjee et al., 2023a and b; Hills, 2023).

An important further question is the impact that all these shocks have had on people in work, particularly those who experience in-work poverty, defined as a household living in poverty even though at least one adult is in work (JRF, 2023). Table 2.1 shows that the cost-of-living crisis in 2022 had a negative effect on wage growth for the working poor notwithstanding rises in the National Minimum Wage and the Living Wage. The negative impact on the working poor is even more severe, with inflation far exceeding pay for households in the bottom decile, much more so than the median. As a result, the divergence between the poorest workers and the median has grown...

The regional distribution of real wage growth also shows a growing disparity between the prosperous parts of London and the metropolitan parts of the South East where we project that real wages will have grown by up to 7 per cent between the fourth quarter of 2019 and the fourth quarter of 2024, and poorer parts such as the West Midlands where we project a fall of 5 per cent over the same period...

Since the recent rise in the National Living Wage and the Minimum Wage, this situation has started to change, even if year-on-year real wage growth both at the 10th percentile and the median is still negative and growth for the bottom decile has not caught up. Overall, this suggests poor prospects for closing the gap between the high- and low-income households as well as top and worst performing parts of the country, which is the first mission in the 2022 Levelling Up White Paper (DLUHC, 2022).

Book of the week

We recommend reading Don't Be Evil: The Case Against Big Tech by Rana Foroohar. This book examines how democracies can hold the tech giants to account and address the harmful effects of digital technology:

I have no doubt that even if they are well regulated, Big Tech firms will continue to turn disproportionate profits, because … their key inputs – our data – are had for free. In an era in which most wealth will live in data, intellectual property, and other intangible assets, it will be important to come up with more equitable ways to share that pie…

But the tech platform companies are not the only ones in the digital surveillance business. Data brokers such as credit bureaus healthcare firms, and credit card companies collect and sell all sorts of sensitive personal user data to other businesses and organizations that do not have the scale to collect it themselves. These include retailers, banks, mortgage lenders, colleges, universities, charities, and – as if we could forget – political campaigns. This is one reason we haven't seen more companies outside Silicon Valley pushing for antitrust action against the big technology companies – they are the ones buying what the Valley is selling. The advent of the Internet of things, in which Web-enabled sensors are embedded in objects all around us, will exponentially expand the opportunities for digital resource extraction. Every company is getting into this business. As a result, we may not be able to simply regulate away all the problems that are being posed by surveillance capitalism.

That’s why it is worth considering whether the companies that extract our digital oil should have to pay for it. California has also proposed a “digital dividend” paid by data collectors to the owners of this resource – all of us. It is akin to the way Alaska and countries including Norway have created wealth funds into which a percentage of revenues from commodities are invested for the benefit of future generations. The extractors can afford it. Google and Facebook have high double-digit profit margins because they do not pay for their raw inputs – our data. But we should own our own personal information. And if the extractors use it, they should have to compensate us. The four major categories of data harvesters – platforms, data brokers, credit cards, and healthcare firms – could pay every American who uses the Internet a set fee, using a portion of their own revenue. Or the extractors could be forced to put a portion of that money into a public fund that invests in education and infrastructure…

Taxing data extractors cannot, however, be a get-out-of-jail-free card that allows them to run roughshod over individual privacy or civil liberty. For users of platform technology, transparency could be increased with “opt-in” provisions that allow them more control over how their data is used... The “opt-in” language should be clear and simple, with the burden of proof for violations on companies rather than individuals. Big Tech companies should also be required to keep audit logs of the data they feed into their algorithms, and be prepared to explain their algorithms to the public…

Companies should be prepared to make themselves open to algorithmic audits, as suggested by mathematician and Big Tech critic Cathy O'Neil, in case of complaints or concerns about algorithmic bias that could allow for discrimination in the workplace, healthcare, education, and so on.

Individuals should also have their digital rights legalized. Former Wired editor John Battelle has proposed a digital bill of rights that would assign possession of data to its true owner, which is, of course, the user and generator of that data, not the company that made off with it. He believes this notion should be so central that it should be enshrined as an amendment to the Constitution… Finally, I would like to see a digital consumer protection bureau, with tough rules around discrimination by algorithms, and a system for ensuring that individuals can access and understand how their personal data is being used, as we can with credit scores today.

Quick links

Inflation fell from 7.9 percent in June to 6.8 percent in July 2023.

The state pension will increase to £11,469 next year giving pensioners an extra £72 a month.

UK manufacturing production increased by 3.1 percent in June 2023…

…but Chancellor Jeremy Hunt rules out following the US by expanding subsidies.

The Government ordered a review of bias in research into low-traffic neighbourhoods.

New polling shows 40 per cent of voters believe utilities should be publicly owned.

Climate change and the environment is third-biggest issue behind the economy and inflation.

Three in four people think Britain is becoming a worse place to live.

The fertility rate in England and Wales down to 1.5.

High demand is causing 30 per cent of GP practices to stop offering routine appointments.

Poland announces a referendum on an EU relocation scheme for migrants.

Doubling the size of Cambridge might not be as effective as creating more R&D and innovation clusters outside of the South East.

The Government has said that all new non-residential buildings must have a single-sex toilet in new draft guidance.

Sir Keir Starmer said he would not have blocked the Scottish Government’s gender recognition reforms.

Brazil’s trade surplus for July 2023 is at a record level driven by exports to China and Latin America.

The Metropolitan Police arrested three Bulgarians suspected of spying for Russia.

Saudi Arabia wants to join the combat aircraft programme with UK, Italy, and Japan.

Former Manchester United player Philip Mulryne has become a Catholic priest.