Rip it up and start again

Armstrong was quietly dispatched to Rothschild’s mansion in Barbados to recover from this nervous breakdown. By the time he returned, Harold Wilson had replaced Heath as prime minister and consented to Armstrong taking up a role outside the civil service as chair of Midland Bank.

Sir William’s breakdown was precipitated by one of the worst postwar crises to hit the British state. A combination of spectacularly misconceived economic policy and conflict in the Middle East led to a rapid increase in inflation and a brutal recession. A miners’ strike left the country without enough coal. 

Heath was forced to implement a law that forbade non-essential companies from using electricity more than three days a week. Television stations were shut down from 10.30pm to conserve energy. It got to the point where ration books were distributed to motorists, and columnists wrote about a possible military coup. Heath, refusing to settle with the miners, was forced into an early election, which he lost.

Armstrong, who was often called the “real deputy prime minister” due to his influence over Heath and his habit of appearing alongside him at press conferences, buckled under the pressure. He was trying to run the civil service while also acting as the prime minister’s main economic policy adviser as inflation rose inexorably. 

The prices and incomes policy, through which the government tried to rigidly control the economy, failed. The miners’ strike felt like a test of authority that the government could not back away from but also could not win. It was too much.

I asked Sir Robin Butler, who was working as Heath’s private secretary at the time, and later ran No 10 for Margaret Thatcher, John Major and Tony Blair, whether it was the worst crisis he had experienced in government.

“No,” he said. “Every crisis is a crisis in a different way… I don’t think any of them outweigh the others.”

One of the great dangers of writing about contemporary politics is the declinism trap. We have a natural human tendency to focus on the problems of our times and the triumphs of the past. 

When we look around us at the legacy of the Boris Johnson and Liz Truss premierships, an economy that has been stagnant for over 15 years, failing public services, record levels of child poverty, overcrowded prisons, sewage in our rivers, and endless cancelled trains, it is hard not to think that we have never had it so bad. 

By contrast, previous eras can be fondly imagined as ones where ministers were dedicated public servants, the cream of the crop, aided by a Rolls-Royce civil service, calmly managing challenges in the public interest.

This is, of course, not true. Modern British history is better thought of not as a story of decline but of a repeating cycle of crises. 

The destruction of the second world war ran into ongoing rationing, then Suez, the inflationary misery of the 1970s, the social decay of the 1980s and so on. Things have usually seemed bad, and sometimes terminal. As Sir Robin said, though, “every crisis is a crisis in a different way”.

Eventually the challenges of a given era get so bad that a dam breaks and a way of doing things that has become accepted as inevitable, or too hard to change, gets washed away. These dramatic moments happen roughly every 40 years and often, by resolving the biggest contemporary problems, create the conditions for the next crisis cycle.

In his book The Death of Consensus, the historian Phil Tinline looks at these turning points and the conditions required to trigger them: “Democracy means that any unthinkable new idea has to go through a long trial before it can be sufficiently established for a government to win power and act on it. The dispelling of an old nightmare, the destruction of an old taboo, takes a lot of back-and-forth wrangling between the established orthodoxy and the new contender. While that is happening, things look bleak, and frightening.”

We are reaching the end of our current cycle. Our moment of change is due, and the new Labour government has the opportunity to deliver it. How painful that transition will be, though, depends on correctly diagnosing the particular crisis of our times.

The initial crises of the British state were ones of democracy; the mid-century ones were those of social conflict; and the 1970s and 1980s of economic upheaval. The one we are in now is a crisis of governance.

Our problem is the total failure of our political institutions to deal with the challenges we have. Britain’s constitution has always been an oddity among developed countries. None of our institutions were designed but rather evolved incrementally through precedent, convention and, occasionally, crisis. Many of the core blocks of our political system have no basis in law. From the role of the prime minister, to the appointment of the cabinet, to the status of the opposition, and the powers of the speaker, it is convention all the way down.

It is almost 50 years since the senior Conservative politician Lord Hailsham popularised the term “elective dictatorship” to describe the enormous power held by a government with a majority in the Commons. This is a result of having an almost entirely ceremonial head of state in the monarchy, an extremely weak and unelected second chamber in the House of Lords, a main legislature whose timetable is controlled by the government, and a judiciary that, by convention, follows the laws as laid down by that legislature. Constitutional scholars like Vernon Bogdanor and Peter Hennessy have been documenting these challenges, both real and theoretical, for many decades. As Bogdanor noted in 1995, we have “a very peculiar constitution which no one intended… whereby the government of the day decides what the constitution is.”

Over the last 40 years, first gradually and then suddenly, these innate pressures, compounded by other factors, have caused our institutions to fail. Three trends have caused an already troubled system to gum up completely and leave us with a crisis of governance.

First, the British state became one of the most centralised democracies in the world. As a result, it is simply trying to do far too much through institutions, like No 10 Downing Street and the Treasury, that do not have anywhere near the capacity or capabilities to cope.

As Rupert Harrison, who was George Osborne’s most senior adviser throughout his time as chancellor, put it to me: “The core weakness of the British state is the constant chopping and changing and the inability to stick to any long-term strategy, whether that’s industrial policy, public sector reform, tax policy… compared to other European countries, in particular, we’re just hopeless at sticking to anything… We’re incredibly vulnerable to a new government or new minister coming in, wanting to reinvent the wheel, ripping up what came before… There’s just this irresistible range of levers and a desire to fiddle.”

Second, the British government became the most dominant of any western democracy at the expense of both parliament and, ultimately, the British people parliament is supposed to represent.

Executive dominance is not a new phenomenon. It is a function of the way British democracy evolved. By the early 20th century the monarch’s role had become almost entirely ceremonial, with full executive power shifting to his or her ministers. Then with the passing of the Parliament Act in 1911, the Commons achieved dominance over the Lords.

From then on, a prime minister with a majority in parliament, who could keep their own party on board, was one of the most powerful elected officials in the world. Most democracies have a network of inbuilt checks and balances. This can be a head of state with meaningful powers; a second chamber that can block legislation; and/or a judiciary with independent responsibility for safeguarding a written constitution. We have none of these things. 

And third, at the heart of it all, is the media and, as with the other two trends, the often baleful presence of unaccountable press barons is hardly new. Partisan and scurrilous pamphlets appeared alongside the early glimmerings of democracy in the 17th century. 

But if these rows aren’t new, the frequency and intensity of the relationship between media and politics shifted dramatically in 1989 when parliament was televised for the first time and Sky launched 24-hour rolling news. This was followed by another revolution with the arrival of social media in the late 2000s.

The consequences have not all been negative. Higher levels of transparency have improved the behaviour and work rate of politicians, on average. Conspiracies of silence, such as when Churchill’s team covered up a serious stroke he suffered in 1953, would be much harder these days.

Most of the changes, though, have been harmful. Decisions need to be taken much faster under a lot more pressure, which rarely ends well. Also, managing the insatiable appetite of modern media leads to terrible incentives to make far too many announcements, which are often poorly thought through. 

Given the already severely limited capacity of central government, the time spent on media management crowds out space for good policy-making. As Camilla Cavendish, who ran David Cameron’s Policy Unit in No 10, put it: “Walk into No 10 and the ground floor is essentially the cabinet room, the prime minister’s office and an enormous comms operation. And that tells you the priorities of any government.”

Social media has accelerated these trends and perpetuated an “always online” culture across Westminster. Everyone in politics is now constantly bombarded with information, judgments and requests. It is rare to have a conversation with a politician or adviser that is not punctuated with regular looks down at the phone. 

Beyond the news, the rise of social media abuse has, more than any other trend, led to making politics a deeply unpleasant job with high rates of burnout. It is particularly true for women and people of colour who are on the receiving end of regular misogynistic and racist abuse, but it applies across the board. It also adds to the feeling politicians have always had of being under constant attack, which again leads to worse decision-making, and an obstructive and defensive mentality.

Each of these three trends – hyper-centralisation; executive dominance of an ever bigger and more complex state; and a superfast media cycle – exacerbates the others. It is a horrible mess. Incremental improvements are not enough. We do need change on the scale of universal suffrage; the postwar expansion of the welfare state; or the economic revolution of the Thatcher years.

It has to start with a wholesale restructuring of the state to shift power down from Whitehall to regional government. Without doing this we will never see our cities outside London achieve their potential. Nor will central government ever be able to cope with the status quo. Fiddling around with central government machinery – by, for instance, strengthening No 10 and providing better support to the prime minister – could certainly help but it would not solve the underlying problem of them simply having too much day-to-day responsibility.

But these things are all relative. Our standards of living may be slipping down the global rankings, but we are, for now, still a rich country, with the ability to rapidly improve things if there is the will to do so. As the great economist Adam Smith calmly replied to the news of a British Army defeat during the American War of Independence, “there is a great deal of ruin in a nation”.

Every country has its own problems, its own historical context, its own crisis cycle. But ours do seem particularly bad. 

Taking purchasing power into account, the average Brit is considerably poorer than their western European counterparts, let alone Americans. On current trends this will be true of Slovenia soon and Poland by the end of the 2020s.

While many of the problems I talk about are true across rich countries, we are outliers in having a government so powerful and with control over so much. While we might not want to swing too far in the other direction, and find ourselves with the problems other countries complain about, we do need to rebalance.

Fellow Brits I have spoken to had less difficulty in accepting our system was broken. But some told me that in blaming our problems on institutional failure I am letting our current crop of politicians off the hook. 

I am certainly not claiming that the individuals in charge, the ideologies they hold, and the decisions they take, do not matter. But I do argue that we have the politicians we do because of the system we have. 

We have an entire incentive structure that selects for qualities unrelated to the ability to govern well. No doubt many MPs, of all parties, are genuinely motivated by a sense of public service, but they are not the ones who will necessarily get to the top. Sometimes people who do have the ability to govern well will find themselves in positions of power but this is, too often, a matter of luck.

Even when more talented people find themselves in power, they are trapped in institutions that do not work, and bad systems beat good people every time. Every prime minister, after a short period in Downing Street, realises how few effective levers they have. 

As Helen MacNamara, who was one of the most senior civil servants in government before leaving in 2021, put it: “[There is a huge] gap between what people think government is and what it actually has become in practice. It’s really easy to say, it’s this useless minister or that bad Spad. You can have, rightly or wrongly, as many opinions as you’d like about them as individuals. But actually the structural foundation, the underpinning of the way our government operates, has become so different to what people imagine it to be.”

In short, absolutely nobody is happy with the current state of affairs. No ideological grouping feels like it is getting its way. Libertarian Tories have seen the tax burden rise to record levels and the planning system grind to a halt. Fiscal hawks have seen debt levels increase to peaks unimaginable a few decades ago. Social conservatives have watched on as net migration has hit numbers well beyond previous records. The centre left has seen public services weaken, in some cases to the point of collapse, and basic standards of government overturned. Child poverty is at record levels, and homelessness is on the rise again.

The one thing everyone does seem to be able to agree on is that the system is broken. Even Rishi Sunak said as much in his 2023 party conference speech:

“Politics doesn’t work the way it should. We’ve had 30 years of a political system which incentivises the easy decision, not the right one… And why? Because our political system is too focused on short-term advantage, not long-term success. Politicians spend more time campaigning for change than actually delivering it.” In that very speech he announced an extremely short-termist decision to cancel the second leg of the HS2 rail project with no proper consultation or plan.

And yet, issues of governance and constitutional failure are inherently abstract and, to most of the population, impenetrable. Persuading people that the structure of government, or the way ministers timetable legislation, is the ultimate cause of their pay packet not increasing in a decade, or their inability to get a GP appointment, or sewage spewing out on to the local beach, is a hard sell. That makes the crisis self-reinforcing in a way previous ones were not. 

As things get worse, the more likely it is that the very suggestion of focusing on what can seem like arcane “Westminster bubble” issues is dismissed. MPs will not even vote to repair the building they are sitting in for fear it would seem self-indulgent.

No doubt many of the people who work in and around Westminster will be shaking their heads at the thought of trying to make progress on some of these issues, thinking “it’ll never happen”. The assumption is that governments, even if they hint at reforms in opposition, will never give away power in practice. But resolving a crisis cycle requires overturning a previously fixed orthodoxy. Whether it takes two years, 10 or 20, eventually a government will realise they cannot achieve much with broken institutions. And we do not have 20 years.

Extracted from Failed State by Sam Freedman, Macmillan, £20.00