Can Beijing bounce back?
Isabel Hilton writes in her usual well-informed style about the challenges facing Beijing. Her comments on the country’s struggles with the pandemic, its housing crisis, its poor growth over 2022—and the possibility it falls into the “middle-income trap”—are well made. It is clear that China’s leaders are facing a grim menu of economic difficulties. Nor could one reasonably dissent from Hilton’s assessment that they are likely to prioritise shoring up their own political power over finding effective answers.
Still, China throws surprises at even the most seasoned analysts. Within days of the nationwide protests against continuing lockdowns in November, Chinese leaders lifted many restrictions, including strict tracing requirements. This was despite most expecting that this sort of surveillance would carry on when the pandemic died down. Autocracies have many issues—but making huge U-turns is not at the top of their list of fears. The question remains whether the country is going to be able to manage the nasty spike and high number of fatalities that have emerged in the past few weeks, but the willingness to make shameless about-turns often works to China’s advantage.
This makes me more hesitant than Hilton in predicting such negative events over the horizon. The one golden rule that anyone observing China over the last few decades has had to bear in mind is that outside observers are almost always dramatically more pessimistic about the country’s options than is ultimately justifiable. China might well be facing profound systemic challenges this time around, of an order not seen before. It may be due a reckoning. The evidence as of today, however, is that the Communist party will be ruthless in maintaining its hold on power. And to do that, it will be willing to deploy any policy responses necessary—even ones that it stated just a few days before were impossible. In this context, all one can do is expect surprises.
Kerry Brown, King’s College London
New beginnings
Brexit presented the country with a reset button. Iain Martin and Patience Wheatcroft began to touch on this, noting that one of the benefits of Brexit is that we can no longer blame the EU for our economic woes.
We gained some freedoms when we left, but cutting red tape isn’t going to fix our economy. Nor are new trade agreements with distant friends such as Australia. There have been some disadvantages to leaving. It is certainly the case that the EU has been more obstinate in negotiations than I expected—and hoped. But the discussion about any closer relationship with the EU misses the point. Tinkering at the margins of that relationship isn’t going to transform our economy—we must think far bigger.
The greatest benefit of Brexit could in fact be that it will shake the political establishment out of its complacency, forcing it to look at our economy afresh, tease out the faults and find workable solutions. The real drags on our economy are low investment, an exchange rate that is far too high, over-dependence on services and the southeast, and neglect of our manufacturing industry. Brexit has uncovered the reset button. It’s time that we hit it and dealt with these issues.
John Mills, former chair of Vote Leave
It’s a shame that, after great analysis of “Brexosis”, Ferdinand Mount does not make clear that a step-by-step return to EU membership would be the best solution. In a democracy, a vote is not forever. We took a wrong turn in 2016, misled by lies and potential foreign interference. Why would we not turn around, rather than just continue on this harmful path using a different mode of transport?
Single market and customs union to start with. The saner parties must form a progressive alliance in Westminster and get rid of the disaster capitalists and right-wing zealots. The vision is rejoin.
Magdalena Williams, via the website
Healing the health service
Alexander Menden’s comparison of the NHS to the social insurance approach in Germany reminds me of the time that I was advising the Ministry of Defence on which German hospitals to use, when the British military hospitals on the Rhine closed in the 1990s. An air vice-marshal phoned me, worried about the possible drop in the quality of healthcare for his airmen and women. I was able to reassure him that the quality would be twice as good but at double the cost!
Menden’s insightful anecdotes can be backed up with statistics comparing health expenditure, access and quality. Adjusting for differences in purchasing power, the US spent $12,318 per person in 2021 compared to Germany’s $7,383 and the UK’s $5,387, yet performed worse in the 2019 Healthcare Access and Quality Index, at 81 compared to Germany’s 87 and the UK’s 83. Germany does better than the UK—but at greater expense.
Three key differences stand out for me in comparing the German and British systems. First, it is easier for staff to be devoted to a system like the NHS, with equal conditions of service for staff (individual German providers set their own conditions, excepting collective agreement for nurses’ salaries). Second, administration costs are higher in systems based on social insurance than pure exchequer funding. Third, the decentralised German system—with the majority of district hospitals owned by local churches, charities like the Red Cross or local government—helps to insulate the service from national politicians.
So how do we follow Menden’s suggestion to improve rather than replace the NHS? First, maintain the national conditions of service, which means stopping the relentless outsourcing intensified by the Health and Social Care Act 2012 (although somewhat ameliorated by more recent legislation). Otherwise, private providers can impose their own conditions on the staff who keep the health service functioning. Second, continue central funding to keep admin costs down. Third, protect the service from national politicians by returning the hospitals to local government and the voluntary sector, and enshrining subsidiarity in law.
Cam Bowie, Somerset
Half as many nurses, a third as many hospital beds, and a quarter less health spending. No need for other explanations, is there?
Ivan Helmer, via the website
Imagination barrier
A very important contribution from Geoff Mulgan in view of our current difficulties. Nostalgia—including intellectual nostalgia—is to be expected on the right and I am happy to leave them to it, but the lack of bold yet practical thinking on the centre-left is a real problem. It may cost the left its next chance to move the country forward in the way in which great reforming governments have in the past.
As Mulgan suggests, the answer lies partly in academia. We need a new generation of thinkers who are not obsessed with producing a quota of published papers every year but want to see their ideas tried out and are prepared to get their hands dirty in the messy world of practical politics. They will have to persuade progressive leaders to stop seeing politics as a marketing exercise and start to believe in their own ideas and values. This might be easier at the second tier of government—mayors, Scotland, Wales and so on.
Perhaps we need a new kind of research institution more dedicated to actually seeing things happen. I wonder also if the involvement of physical scientists in politics—perhaps towards the end of their careers—would not be a good thing.
Keith Macdonald, via the website
A thought-provoking article by Mulgan. It would be interesting to see if this absence of imagination is tied to the lack of support for creative subjects in schools from the 1980s onwards. Arts and culture may not be seen as intrinsic to economies in the way maths and science are; yet without their stimulation of creative thought in young people, architects, economists and even politicians are stunted in their development.
Jo Towler, via the website
Fuelling the fringe?
I am so disappointed in Prospect for publishing Maya Forstater’s response to Rowan Moore. Such blind loyalty to “both sides” journalism serves no one. There is no requirement for you to platform a hateful rebuttal to an essay you have published, and I’m sure in most cases you do no such thing. The so-called “trans debate” is fuelled by media outlets enabling this kind of live argument, rather than pursuing respectful and critical journalism. The beliefs expressed in Forstater’s piece are fringe ideas amplified by the internet, when the role of a journalistic outlet is to parse through the noise and publish worthwhile writing. There is no debate over whether trans people exist. They do. I hope you will do better in future.
Jane W, via the website
Evading capture
John Kay makes the case that economic regulation doesn’t work or lacks effective enforcement. Could the independent oversight of economic regulation be the job of a specialist prosecutor such as the Department of Justice or attorney general, charged with identifying compliance failures and bringing cases before the courts?
Tim Cowen, via the website
There’s a whole web of interconnected practices that need tighter regulation or indeed outright banning. Company donations to political parties and large personal donations from wealthy individuals are made not out of charity but with the intention of exerting influence. Murky lobbying by business, paying large fees for a “dinner”, direct access to government ministers and the ear of the PM; the revolving door between regulators and the regulated; the appointment of cronies and has-beens to the House of Lords; these and more facilitate capture.
It is easy for the wealthy to bend the ear of a minister or PM, but how do I, an ordinary voter, get to lobby in person? The answer is that I don’t. I have to settle for being grateful that I have a vote, if not a voice. This is not democracy.
Graham Hewitt, via the website
Cultural con
I couldn’t agree more with Samuel West that the slogan of “levelling up” under which the new arts funding settlement is being done feels like a con (“Diary”, Jan/Feb). My parents met in the pit at the Coliseum, so I have a soft spot for English National Opera and am sad that the Arts Council has sought to make ENO the sacrificial lamb, cutting its grant, then offering it much less money to move out of London. It has now been granted a reprieve of sorts—but must still work around a real-terms cut and has no certainty beyond early 2024.
It may be that, planned carefully, cultural institutions can be moved around to regenerate communities, but it doesn’t seem as though there’s any joined-up planning here. Any major relocation in the arts is complex. Performers have lives, schools and mortgages. When the much smaller Sadler’s Wells touring ballet was invited to move to Birmingham in the late 1980s, artists were consulted and given years to transition. The ENO has 300 full-time employees and hundreds more part-timers.
We don’t even know where the new base will be. Manchester is sometimes suggested. But cultural organisations in Manchester weren’t consulted. Opera North in Leeds has called the plans “nonsense”—and why would Manchester, or Birmingham, want to be fobbed off with an opera company whose funding is imperilled? Far from bringing opera to people around the country, the risk is that a chaotic move would destroy the ENO.
Oddly, in January, Nadine Dorries—who originally told the Arts Council to move money away from London—turned on the body, accusing it of having pulled a politically motivated stunt. If Dorries now realises what a mess this is, and with the original swingeing cuts having since been postponed, I’m beginning to hope a solution can be found.
Vanora Bennett, journalist and writer
Market fundamentalism
Ben Jackson’s review of Hayek: A Life reminded me of the Austrian-British economist’s fascinating paper on “The Economic Conditions of Interstate Federalism”, published in 1939, which challenges the thinking of free-trade Brexiteers such as Daniel Hannan and Jacob Rees-Mogg.
Hayek wrote: “it is rightly regarded as one of the great advantages of interstate federation that it would do away with the impediments as to the movement of men, goods, and capital between the states and that it would render possible the creation of common rules of law, a uniform monetary system, and common control of communications. The material benefits that would spring from the creation of so large an economic area can hardly be overestimated, and it appears to be taken for granted that economic union and political union would be combined as a matter of course.”
He argued that national sovereignty creates pressures for increased state intervention in markets, as indeed many who voted Leave want and governments will now be forced to concede.
Titus Alexander, Scottish borders
Alexander the late
An interesting article on the legacy of Alexander the Great, though I am not sure about Alexander dying “after a heavy drinking bout”. Given his drinking habits and his years in the field, I imagine most of his days were followed by a drinking bout. More likely, he died from a serious illness of the kind that took many in the ancient world.
Chris, via the website
