Burnham’s reindustrialisation plan faces market challenge, says Guardian columnist
8 reported
A Guardian opinion piece by Larry Elliott argues that Prime Minister Andy Burnham shares similarities with former Prime Minister Liz Truss in diagnosing economic problems and seeking change, but must avoid Truss's fate of market rejection. Elliott states that Burnham's analysis of a City of London-dominated economy with shrinking manufacturing and stagnant living standards is accurate. The columnist, co-author of the forthcoming book "Reindustrialise Britain," contends that Britain's real problems are production, not distribution, and requires a state-led reindustrialisation strategy. Elliott recommends a national investment bank providing long-term patient capital tied to public equity stakes, and broadening the Bank of England's mandate to fund reindustrialisation. The piece notes that even before taking office, there are signs of financial market pressure, with predecessor Keir Starmer leaving Burnham to fund the government's defence investment plan. Elliott warns that bowing to market pressure would perpetuate a cycle of weak growth, budget deficits, and demands for austerity.
What’s reported
The Guardian opinion piece by Larry Elliott compares Andy Burnham to Liz Truss in their views on the economy and desire for change.
Truss's tax-cutting mini-budget was "brutally rejected by the financial markets" within weeks.
Elliott states that over the past 40 years, the economy has become dominated by the City of London, manufacturing's share of output has shrunk, and living standards are barely higher than before the 2008 banking crisis.
The piece argues that neoliberal policies introduced by Margaret Thatcher have failed, especially in former industrial heartlands.
Elliott co-authored the forthcoming book "Reindustrialise Britain" with Costas Lapavitsas and Doug Nicholls.
The article recommends a national investment bank with a mandate for long-term, patient capital for transport, energy, and industrial supply chains.
It suggests broadening the Bank of England's mandate to provide low-cost, patient capital for reindustrialisation.
The piece notes that even before Burnham took office, there are signs of financial market pressure, with Starmer leaving him to fund the defence investment plan.
Key figures
Andy Burnham: Prime Minister, former mayor of Greater Manchester
Liz Truss: Former Prime Minister
Keir Starmer: Former Prime Minister
Larry Elliott: Guardian columnist and co-author of "Reindustrialise Britain"
Costas Lapavitsas: Co-author of "Reindustrialise Britain"
Doug Nicholls: Co-author of "Reindustrialise Britain"
Sources: The Guardian
