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Milton Freedman once wrote “the political system is not inclined to bring about policies that would reduce the scope of government. Politicians win elections by promising benefits, not by imposing burdens.” What Freedman was suggesting was a simple truth, namely that the democratic tendency is always for the state to keep growing by venturing into ever expanding domains where it previously had no business. State power, and responsibility, creeps through promises and manifestos that politicians produce to woo the voters into areas that once were the strict domain of the individual, or family, or civic organisation. Take education, or the fire service, or for that matter the police, these were all in the private domain, before politicians, rightly by any account, decided to take them into the public realm as it was perceived to be a universal public good. “Politicians”, said James Buchanan, “like everyone else, respond to incentives. When they can get away with overspending, overpromising, and overcommitting, they will.” His words echo true today more than ever. Prime ministers of every colour and philosophical inclination from Blair to Brown, even Cameron to Johnson, and now Sunak have all expanded the remit of the state. Each has spent and borrowed continuously increasing the overall debt of the country. Ten percent of all the tax collected by the exchequer will be spent on servicing the UK national debt.[1] In most developed economies the numbers tell the same story, because politicians have worked out that so long as every country proportionately continues to overspend and over commit, the markets will be hoodwinked into a false sense of reality, at least in the short term, exactly what politicians prefer to think about — the short term. Ultimately, however, reality catches up in the form of inflation. Inflation, if not tackled quickly, has the power to bring down nations and even empires. History is a graveyard full of such nations and empires that ruled for centuries only to be brought to its knees by inflation caused by reckless fiscal management. Most developed economies today suffer from higher inflation, rising national debts, cuts in public spending, and burgeoning population of elderly citizens. Many in the West have lost confidence in the system, having spent the last two decades without a real wage rise, while the cost of living has spiralled. Only very recently have we seen any real rise in wages, and that too mostly from the private sector. This has quite rightly left many working-class, and younger voters disenchanted and out of love with open markets. Open markets have worked tremendously well to an extent, but not for everyone. Many people feel left behind. Citizens throughout the developed West are asking if we have run out of steam? Are we in need of a new economic model? At the heart of this disenchantment is China. China brought to the world stage State Capitalism at a scale never seen before. Central to the idea is that protectionism is the way to cope with the buffeting of open markets. China’s extraordinary success convinced unions in the West that they had a lot to lose from the free movement of goods across borders. Then came Covid-19, which informed western policy makers that supply chains were fragile and needed near-shoring or onshoring again. China’s state capitalism, with its disregard for international law, human rights, and rule-based trading system, was seized on in developed countries as a justification for state intervention. Politicians laboured over the fragility of international supply chains, echoed by unions and the anti-globalisation lobby all culminating in building what some have called a ‘cathedral of fear’. That fear had to be addressed by more government, more intervention, more protectionism, and with ever more government comes ever more spending. We have begun to adopt, at our own peril, a Chinese inspired State Capitalism. State intervention and closing of open markets is dangerous on several grounds. Open markets during downturns, if left alone, clear out poor businesses, those that are inefficient, or simply unable to modernise as per customer demands. This pain spurs innovation and new businesses are formed, and the economy is revitalised, creating new wealth and prosperity. None of which requires the government. We need only allow market forces to do their job. State protectionism reduces, or even protects us from this necessary pain. Governments to tackle inflation need to spend less, a lot less, and increase taxes to burn access liquidity in the market. The Conservative Party, under Sunak, has gone against its own ideological position of lowering taxes and has raised taxes to the highest level in modern British history as a percentage of GDP. Starmer, to his credit has indicated that he will maintain the Conservative status quo and keep Britain on a strict fiscal diet to bring down inflation. These are tough asks in a democracy. What Britain needs is less government, not more. State intervention is often too slow, cumbersome, and incapable of meeting the demands of a modern globalised economy. The AI and energy transitions required are simply too fast paced and complex for government to plan. Ideas need to be tested and left to die, or rise, by markets, not government committees giving out subsides. Excessive regulation will inhibit innovation and, by raising costs, make change slower and ultimately more painful without clearing out all the deadwood in the economy. The problem is that politicians love spending other people’s money, and as government budgets get ever bigger, special interests will have a feeding frenzy and a growing influence. The way forward: 7-points to keep in mind The way forward is to simply have the courage to do what we know to be right. We know the way; our leaders just need to have the courage to walk it. First, allow markets to do what they do best — meet consumer demand in the most efficient manner. In almost every sector government need not be active, and simply enable free market economics to take shape. Where supply outstrips demand,

At the Bank of England Museum Britannia is described as a symbol of British strength. She is the personification of Britain that dates to the Roman era, typically shown with a trident, a shield and a warrior’s helmet. Today we mostly recognise her on our bank notes and coins. She is calm, poised and commanding. She was not always so. Britannia throughout the ages has been personified to represent the deepest aspirations, what we want to envisage ourselves to be as Britons. Roman emperors like Antoninus Pius (AD 138 -161) depicted her as a fierce warrior perched on a wall safeguarding the furthest limits of the Roman empire. In the 1750s she became the proud freer of slaves, in portraits where she sits next to a tamed lion, as black slaves kneel before her in gratitude. In the 1800s she was depicted negotiating with what was British India over who would pay for the Afghanistan war. Skip a few centuries and we see portrayals of a post Brexit Britannia — aged, destitute, and looking for some ‘spare trade’. Jörg Schindler, a journalist for Germany’s premier newspaper Spiegel, wrote extensively on what he saw, namely ‘The UK faces a steep climb out of a deep hole’. He essentially sculpted a narrative that still somewhat haunts us today that of a ‘broken Britain’. A Britain divided by class, north and south, ethnicities and along religious lines. British democracy was once lauded as a stable institution where the world’s money was safe, and stability prized. The last four years have seen that image badly tarnished.intent. In the light of Schindler’s remarks, Prime Minister Rishi Sunak was probably what the nation required: stability. He has certainly done that. Sunak is not flamboyant, nor is he particularly smooth or charming like Blair, but to his credit he is brave, although seen as indecisive at times. He was brave to raise taxes and cut or limit public spending to get inflation under control. He was brave in scrapping HS2. Yet, he is likely to face a massive defeat at the next general elections in 2024. On the red corner, Starmer is desperately trying to emulate ‘steady’ and ‘safe’ and has done a remarkable job of disciplining and sculpting the Labour leadership taking them away from the loons on the far left and soft Islamists in Labour heartlands. The next election seems to be sizing up as a fight between ‘who will manage the economy better’ and ‘who will make us all feel safe again’. We want, as do all electorates, smaller taxes and better public services, and every politician hoodwinks us during election time to do exactly that. This time feels no different. While yet, there is something markedly different. The role of Prime minister in our country has become more presidential (since Blair), and power is more concentrated at №10 than ever before. We are a people that are increasingly voting for the best leader — whoever is seen to come out on top in the gladiatorial televised open mic verbal fisty-cuffs. The problem with this current trajectory is that it attracts narcissists says Dr Brian Klaas at the UCL School of European Languages Culture and Society. Narcissists crave power for powers sake, and they are often quick to abandon the moral ground to get ahead. Note how Johnson swung to appease his crackpot right-wingers while the entire Labour Party elected a man stuck in the 1980s and swung to the far left. Douglas Adams once wrote of a planet on which humans are ruled by lizard overlords. There’s a paradox: the planet is a democracy; the humans hate and outnumber the lizards and yet the lizards always get elected. It turns out the humans vote for the lizards for a simple reason: “If they didn’t … the wrong lizard might get in.” Sunak is not a lizard, indeed he may not even be a narcissist, after all he took the poisoned chalice of leadership of the Conservative Party when he knew it was spiralling into chaos. It would have been far better for him to step back, watch his party implode and then step in when it was safe to do so, and reframe himself as the prodigal son and saviour! His principled approach maybe his undoing. The people don’t seem to want a manager — that’s what the markets and our institutions want. The cynic in me thinks the people want a rainmaker! But maybe, if I was to take a more optimistic view, the people aspire for Britannia to reappear, one fit for the 21st century. Britannia represents a form of nationalism, but not all nationalism is dirty. What we need may not be the political nationalism of the Empire, where we subjugated, and colonised those that were different, or seen to be inferior; but rather a softer cultural nationalism that helps as a binding agent to build a sense of ‘commons’ amongst all our diversity. To quote Professor John Hutchinson, the political philosopher from the London School Economics (LSE), ‘cultural nationalism acts as a force for moral innovation, emerging at times of crisis, to form movements that offer new maps of identity based on historical myths, that in turn may inspire programmes of socio-political regeneration.’ Maybe our democracy needs a renewal. If Hutchinson is correct, then maybe we need a sprinkling of cultural nationalism. Unless we, as a people, know what we stand for, we will always be in danger of being seduced by talented narcissists who seek the mandate to rule over us, and take us somewhere we have no desire to go. We need to hold our leaders to higher values, which clearly charts what we stand for, and where we want to be taken. A leader that will inspire what it means to be British — steady, fair, disciplined, aspirational coupled with hardworking, influential, and strong. This new Britannia is no longer the commander of the seas, and a subjugator of foes, but rather a deity that