With Johnson on the ropes over lockdown parties, reception of the Westminster government’s Levelling Up white paper last week was bumpy. The Guardian was ‘profoundly disappointed’, the Telegraph excoriating of an ‘alphabet soup’ of bureaucratic meddling. Attention swiftly returned to moral outrage at the prime minister’s besmirching of Saint Keir Starmer over the Crown Prosecution Service’s failure to prosecute Jimmy Savile, a BBC celebrity and serial child-sex offender, while Starmer was its Director. Starmer’s defenders included Johnson’s own long-serving policy chief, one of a number of senior aides to flee Downing Street in recent days.
Fulfilling an election pledge to ease the country’s huge regional inequalities would seem important for the Tories’ prospects of retaining the forty or so rustbelt seats in the Midlands and northern England snatched from Labour in 2019, on which their Commons majority depends. But even allowing for the pandemic, it’s taken them a while to get around to it. Hard-right positions on public order and immigration, not to mention a New Cold War foreign policy at Washington’s behest, became apparent some time ago. But regional policy was thrown overboard by Thatcher in the early 1980s, and the current crop of neo-Thatcherites are having to make it up as they go along.
As a rule, talk of ‘levelling up’ doesn’t preview radical measures to come, but rather indicates a wish to forestall them. The term first became common currency in Westminster in the 1860s, when Disraeli’s Tories battled disestablishment of the Anglican Church in British-ruled Ireland. Instead of abolishing the Protestant ascendency, why not set up an inquiry to look at ways to level up Catholic endowments? A century later, Thatcher in Opposition set entrepreneurship and meritocracy against socialistic ‘levelling down’ through high tax and spending. Though it didn’t become part of her repertoire, one of her acolytes, George Osborne, austerity chancellor under Cameron, more recently spoke of building up the North rather than pulling London down. Anyway, it’s not a bad phrase – better than Major’s stale ‘citizen’s charter’ when the Tories were last in a fourth consecutive term in office.
The author of the new Levelling Up paper is Andrew Haldane, seconded to Whitehall from the Royal Society of Arts. Haldane retired last year as Bank of England chief economist after being passed over by Johnson for the post of governor against the advice of the prime minister’s then advisor, Dominic Cummings. In banking and Tory circles (they still overlap), Haldane isn’t what is called ‘sound’. The Financial Times describes him as ‘a free thinker but not a team player’. He comes from a working-class background in Leeds and studied at Sheffield and Warwick, bypassing Oxbridge altogether. In a loose-tongued speech to the Institute of Government, Haldane described his time at the Bank as ‘thirty years of hurt’, drawing on a 1990s football song. The speech was dotted with references to colleagues who had risen further than him – the Bank’s last three governors: Mervyn King, Mark Carney, Andrew Bailey – whose careers Haldane jokingly claimed to have lost sight of.
Haldane became the Bank’s expert in inflation targeting in the becalmed years between the fiasco of an overpriced sterling’s forced exit from the European Exchange Rate mechanism in 1992 and the financial-sector’s implosion in 2008. He subsequently ventured out on a regional roadshow in the name of rebuilding public confidence in the Bank’s operations. The FT pointedly notes that his interest in regional inequalities came despite the Bank lacking a mandate in this area. Haldane closed his tenure at Threadneedle Street by publicly warning of ‘a dependency culture around cheap money’ that had emerged since the launch of quantitative easing in 2009 and been exacerbated by the emergency response to Covid. He urged ‘immediate thought, and action, on unwinding the QE’, fearing a lasting inflationary spiral.
An unorthodox mind but an inflation hawk, Haldane has crafted a white paper that reads better than most, with a historical sweep on the rise and fall of great cities from Jericho and Constantinople to Renaissance Italy. But it offers little in the way of financial stimulus. ‘The cash has already been allocated’, a Treasury source pre-briefed the Telegraph. Haldane rules out ‘dampening down the success of more prosperous areas’, talking instead of spreading opportunity. Gone is Johnson’s earlier suggestion of temporarily relocating the House of Lords to York while Westminster undergoes repairs. Instead, the paper extends George Osborne’s model of legislating for directly elected local mayors as brokers for additional discretionary funding from central government. It pins its hopes on improved coordination across Whitehall to meet twelve overarching targets covering such diverse matters as improving broadband coverage, boosting education and skills, and fostering local residents’ ‘pride in place’. The targets are styled as ‘missions’, a reflection perhaps of the North’s regression in the Whitehall mind – from the ‘growth points’ of the 1960s and the urban ‘regeneration’ projects of New Labour to the current language of colonial evangelism (or is it a fantasy quest?). The missions run until 2030, a far-off date for a Johnson administration whose shelf life can now be counted in days.
The Times recently published opinion-poll evidence that voters ‘were inherently sceptical about a policy that relies on growing the size of the economic pie for everyone’, and would be happy instead to see London levelled down. The upshot of local-devolution initiatives over the past two decades hasn’t been economic, but political: the creation of springboards for aspirant politicians to prove their popular appeal away from the dead-eyed ranks of Westminster. Today there is Johnson, former mayor of London. Tomorrow, probably, Andy Burnham, the ex-New Labour minister running Greater Manchester and itching to replace Starmer at Westminster. Further down the line is Ben Houchen, the 35-year old Tory mayor of Teeside, adept at pulling in favours from Whitehall and instrumental in the Conservatives’ byelection win in Hartlepool last May. Houchen warns The Times that if Johnson falls, the Tories will ‘go back to square one, where the old politics of a southern Conservative Party fails to reach out to the whole country’. But it is the 2019 Tory intake from traditionally ‘red wall’ Labour seats, less well assimilated to Westminster and fearful of their electoral prospects, who have taken a faltering lead in attempts to topple the prime minister.
You could say that uneven development is what goes on in the background in Britain while voters are dangled tiny counterbalancing measures of regional aid or organisational fixes. Haldane’s white paper attributes the UK’s regional problem to a miscellany of historic factors: ‘globalisation, technological progress, advances in transport, logistics and power, and the shift from heavy industry to knowledge-intensive sectors, as well as the rise of foreign holidays and shift from technical training to university education’. The City of London isn’t named in the 305-page document, except in a couple of graphics, though Haldane is in a position to appreciate its weight on the regional scales. It registers on the political scales again too, now that the passions of Brexit have been spent. Chancellor Rishi Sunak, one of the forerunners to replace Johnson, is a former Goldman Sachs analyst and hedge-fund manager; his Labour counterpart Rachel Reeves was an economist at the Bank of England. ‘In the end, the City work around whatever government is in place’, former Barclays chairman John McFarlane told the Sunday Times in 2019, when Corbyn and McDonnell still loomed. Work around: to fix a problem, to circumvent.
Read on: Tom Hazeldine, ‘Revolt of the Rustbelt’, NLR 105.