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A case study in self-sabotage

Who broke Britain? Someone—or something—must have. The past 18 years, enough time for a whole lost generation to be born and brought up, have yielded nothing but stagnation and mass disillusionment. In 2007, before the global financial crisis, Britain was at its postimperial zenith. Median household income had just surpassed that of Germany. A pound was worth more than $2, and London was arguably displacing New York as the center of international banking.

But since then, Britain has been left behind. The country’s output per person is now only just above that of Mississippi, America’s poorest state—and that slight lead is only achieved thanks to London. Outside the capital, in places where tourists do not visit, living standards fall well below Mississippi’s. Brits visiting the United States find that their currency has depreciated to the point where the pound today buys only about $1.35. British wages have lagged well behind those in the U.S., and also those in Germany, France, the Netherlands, Denmark; once you account for inflation, they’ve barely grown at all. Within the next decade, the typical Pole will have a standard of living equal to the typical Brit, if current trends continue.

One generation ago, Britain was a major global power; today, it is a middling one, gripped by sclerosis. Taxation is at the highest level since World War II, yet public services have deteriorated. The National Health Service, the celebrated pillar of the British cradle-to-grave welfare state, has a backlog of 6 million patients—almost a tenth of the population—waiting for treatment. The health service now has to spend more money settling maternity-malpractice claims than it does on actually providing maternity care. Many Brits can neither obtain an appointment with a publicly funded dentist nor afford a private one; in a 2023 survey, one in 10 reported doing DIY dental work, in extreme cases extracting their own teeth or gluing broken crowns back together.

Incomes can be shockingly low: Junior doctors recently went on strike for the 15th time in three years over their salaries, which start at just £38,800; the median salary for British civil servants is £35,680. In April, amid the Iran conflict, the Daily Mail pounced on Prime Minister Keir Starmer for vacationing in Valencia, Spain, at what the tabloid described as a luxury hotel, costing £200 a night.

Some in Britain blame rotten luck—the 2008 financial crash, the coronavirus pandemic, an energy crisis after Russia invaded Ukraine. But other countries endured these challenges too. What differentiated Britain was its self-sabotaging responses to these and other problems. Brexit is the most famous example, but hardly the only one. Bad choices, beginning just after the financial crisis, begot worse ones. As public disillusionment has grown, politicians have been rotated swiftly in and out of power, abruptly terminating whatever policies they had started. Six different prime ministers have governed since the 2010 general election. They do not seem to be getting more talented over time. Less than two years after Starmer’s Labour Party took power, his net approval rating has plunged to minus 42 points. He is widely expected to resign this year, and may have done so by the time you read this.

The country’s downward slide has been consistent in one respect: As Britain has become more and more aware of its diminishment, it has retreated ever more fully into a defensive crouch. Politics have become zero-sum, descending into fights over who has robbed whom. Suspicion has fallen, above all, on immigrants, whom both major parties have turned against. There is still an enduring strain of British exceptionalism, quieter and more understated than the American version, which suggests that by retreating inward, Britain can make itself great again. Astonishingly, or perhaps predictably, it is growing stronger as the country’s problems get worse.

In fairness, the 2008 financial crisis hit Britain especially hard. In the 1990s, both the Tories and Tony Blair’s “New Labour” Party made the same bet: Britain was to be a postindustrial, services-based economy, anchored in finance. Tax receipts from a booming London would be redistributed to lagging regions in the old industrial heartland, helping to renew them. Then came 2008, and London’s financial industry cratered.

But the government’s actions during and after the crisis compounded the damage. Rather than increase spending to revive depressed demand, as modern Keynesians would counsel, the government, then led by Conservative Prime Minister David Cameron, opted to slash budgets as revenue plunged. The theory was that fiscal discipline—cutting spending more sharply than Britain’s peer countries—would inspire confidence and spur growth. At the time, deficits and debt were seen as immoral; unlike profligate Greece, Britain would manage its affairs prudently.

The promised growth did not materialize, and austerity left scars that linger still. Funding for day-to-day NHS operations was maintained, for instance, but only by cannibalizing the capital budget. A 2024 government report found that, as a result of austerity, Britain has “crumbling buildings, mental health patients being accommodated in Victoria-era cells infested with vermin with 17 men sharing two showers, and parts of the NHS operating in decrepit portacabins.”

After austerity cuts to welfare benefits took effect, the share of children who grew up in long-term poverty, meaning half their childhood or more, shot up from about 14 percent to 23 percent. Nutrition appeared to suffer, and doctors reported increased cases of diseases stemming from vitamin deficiencies, such as rickets and scurvy.

Local governments, called councils, saw their grants from the central government fall by 40 percent from 2010 to 2020. In 2023, Birmingham City Council, which is responsible for more than 1 million residents, effectively declared bankruptcy. One-third of all English councils could do the same within five years.

Austerity was felt most harshly by those who were already suffering after deindustrialization. The welfare state had partially compensated the losers from globalization. When it abruptly shrank—because the masters of the universe had miscalculated—anger erupted upward, at British elites, and also outward, at European migrants, who were competing for jobs and public services. It was because of this political pressure that Cameron made another fateful decision: to hold the Brexit referendum in 2016. This was a gambit; Cameron expected the vote to fail. He did not want to leave the European Union, but he wanted to arrest the rise of figures such as Nigel Farage, the longtime gadfly of British politics, who had been campaigning for withdrawal from the EU for decades. Left-behind Britain, the places especially harmed by austerity cuts, voted overwhelmingly to leave. The morning after he lost the referendum, Cameron resigned, ushering in a period of political instability that has now lasted a decade, and shows no sign of ending.

Settling the formal Brexit deal took almost four years of negotiations between Britain and the EU. The resulting uncertainty took a toll on British businesses even then. In 2018, one year before his ascension to prime minister, Boris Johnson was asked by a European diplomat about these adverse effects. He replied, “Fuck business.” And indeed, something like that happened. A recent paper on “The Economic Impact of Brexit,” by five economists, calculated that Brexit caused business investment to drop by 12 to 18 percent, productivity and employment to decline by about 3 to 4 percent, and, most striking, GDP per capita to fall by 6 to 8 percent—twice as much as earlier estimates. The harms weren’t all immediately visible. As with austerity, they accumulated over time.

Outside London, the consequences of almost two lost decades are unignorable. Stoke-on-Trent, in the West Midlands, about 150 miles north of London, was once the ceramics capital of Britain, and quite probably the world. It was geologically blessed by rich seams of both coal and clay; its wares were transported by canal to Liverpool for export. The whole area became known as the Potteries. Stoke once held some 2,000 bottle kilns—huge, bulbous structures in which crockery from companies such as Wedgwood were fired.

Today only 47 remain; the industry employs perhaps 5,000 people—down from some 300,000 in 1984. And because of Britain’s extraordinary energy costs, this number is still declining. Depleted oil drilling in the North Sea and a failure to invest in alternative energy sources have left the country reliant on imported energy, staggering consumers and industry alike. From 2004 to 2024, electricity costs for British businesses more than tripled (even after adjusting for inflation), and are now the highest in the world.

In March, I visited Middleport Pottery, the last remaining ceramics factory that has operated continuously since the Victorian era. A charming elderly guide named Phil Knott showed me around, pointing out the ceramics and crockery that the company supplies to the private residence of King Charles III. In most rooms we entered, he introduced me by saying, “This man here is from Washington to write an article about the ceramics industry.” Though the factory once employed some 400 workers, it now has only 18. Middleport uses smaller gas ovens today, but its last bottle kiln (there once were seven) still sits outside, a vestige of a bygone time. All along the kiln’s exterior—where heat and smoke and ash once escaped—small trees and plants have taken root in the dormant structure.

The deindustrialization of Stoke began a long time ago. In the 1980s, Prime Minister Margaret Thatcher ushered in her “supply side” revolution, emphasizing privatization and breaking the trade unions. This improved the country’s fortunes, but not those of all its parts. Thatcherism hit Stoke hard, causing closures of factories, steelworks, and mines. Lisa Healings, who runs the charity Voluntary Action Stoke-on-Trent, lived through that as a young girl. VAST works with a network of charities to provide food, job training, and counseling, but the group is fighting economic gravity. “There’s now a third generation almost coming through,” Healings told me, whose “parents were unemployed, their grandparents were unemployed, and they don’t see any future for themselves other than living on benefits and being unemployed.”

Austerity was particularly brutal to places like Stoke, where a large share of the population was already dependent on government benefits. Two out of every five children in Stoke live in poverty, one of the highest rates in Britain, and in 2022, the city had one of the highest rates of infant mortality in the country.

Since the turn of this century, successive governments have tried and mostly failed to correct basic problems. In 2003, John Prescott, Blair’s deputy prime minister, started a policy called “Pathfinder,” which aimed to demolish and replace worn-down housing in postindustrial places such as Stoke. Cameron’s government abruptly defunded it in 2010, leaving empty eyesore lots where demolition had finished but building had not yet begun. In 2019, Johnson promised that a new economic-revitalization plan called “Leveling Up” would “answer the plea of the forgotten people and the left-behind towns.” But few specifics were forthcoming until three years later, only months before Johnson resigned. The funding it provided was a pittance compared with the support withdrawn from local governments under austerity.

It is in places like Stoke where discontent with London and Brussels is highest. During the 2016 referendum, 69 percent of residents voted to leave the EU—the highest share of any city in the country. Afterward, Stoke was branded “the capital of Brexit.”

My train north from London was, like many, seriously delayed—in this case because of a loose panel on a front car. “Hopefully it’ll hold on until we get to Manchester,” the conductor announced. This information left me, rather like the panel, flappable, but it had no discernible effect on my fellow passengers. Although Americans should generally not cast aspersions on the rail services of other countries, the episode was yet another reminder of Britain’s degraded state.

Recent plans to transform the country have rested in no small part on High Speed 2, a superfast rail line intended to connect London with Birmingham, Leeds, and Manchester. But since HS2 was proposed, in 2009, its costs have tripled, to more than £100 billion. It is the most expensive rail line in the world. (A special structure to protect a rare bat species near the rail line in Buckinghamshire required 8,000 permits and was built at a cost of £216 million.) The most important sections of the proposed route have been lopped off. The rump line—going from Birmingham, Britain’s second-largest city, to not-quite-central London—may be finished by 2040.

In Birmingham, a local named Gerry Moynihan walked me from the city center to the benighted HS2 terminus. Moynihan—a pleasant, white-haired former lawyer with a dyspeptic X account often focused on his hometown’s troubles—was eager to show me what had gone wrong. He pointed out a large site called Smithfield, formerly the location of grocery wholesalers whose warehouses had been vacant for many years. We passed a few film studios along the canal, some of the more promising businesses that have sprouted up in recent years. Moynihan admitted that their existence poses some challenge to an oft-repeated remark of his—“I see nothing of merit in this city”—but then redirected my attention to the gargantuan potholes in the road, gouged so deep that you could see the Victorian-era cobblestones below; to the trash piled up in vacant lots; and to the discarded boxes for extra-large canisters of nitrous oxide, which is routinely abused in Birmingham.

To get to the HS2 terminus, at Curzon Street Station, Moynihan and I walked along the route of an attempted Birmingham-metro-rail extension, which has itself been beset by delays and cost overruns: a localized version of the HS2 debacle. I could see crawler cranes and excavators moving busily around; huge Y-shaped piers that will, perhaps in a decade, hoist the high-speed rail stood disconnected from each other. HS2 has been delayed for so long that two swiftly built towers near the terminus now themselves look derelict and in need of demolition. “If you’re a developer, why would you invest here? The only reason is HS2, and it is moribund,” Moynihan said.

Building infrastructure, or much of anything else, has become all but impossible in the United Kingdom. In addition to having the world’s most expensive (not yet built) train line, Britain also hosts the world’s most expensive (not yet built) nuclear-power plant, Hinkley Point C. Its environmental-impact assessment ran 31,401 pages; the plant will feature a £700 million “fish disco,” which will pulse sounds underwater to deter animals from its intake pipes. The government spent 32 years and £179 million planning a tunnel beneath Stonehenge to relieve traffic, only to officially scrap the plan this year. Even basic tasks, such as obtaining power, can be nightmarish. “In the U.K., you can be waiting for five years to get any kind of energy-intensive project connected to the grid,” Sam Bowman, a founding editor of the magazine Works in Progress, told me. These failures are all self-imposed. Parliament, by design, could exercise broad authority over these matters—yet rather than wielding this power to confront Britain’s problems, it has chosen instead to smother the state with veto points, proceduralism, and endless reviews.

Britain suffers from a housing crisis significantly worse than America’s. The problem cannot even be blamed on zoning, because Britain does not have a zoning regime to speak of. Rather, every attempt to build is a painful, ad hoc negotiation with local government councils and NIMBY residents. As a result, housing costs per square foot are among the highest in Europe. In the words of one report, “Our housing stock offers the worst value for money of any advanced economy.” France has roughly the same population as the U.K., but almost 50 percent more homes. And yet, since the financial crisis, the U.K.’s rate of housing production has only fallen.

Britain’s building problems are not limited to the periphery. In London, the typical house sold in 2024 cost 11 times median earnings. And although London remains an alluring global city, it, too, is stagnating—since the financial crisis, worker productivity there has been essentially flat. Even so, London today is almost 50 percent more productive than the West Midlands, which includes both Stoke and Birmingham. Anna Stansbury, an economist at MIT, told me that the gaps between London and other British cities are comparable to those between cities in West and East Germany. In regional terms, the problem of the past two decades is essentially that London has hardly grown, yet Britain’s smaller cities remain so far behind it.

There are some exceptions to the general pattern of British malaise: Oxford and Cambridge, world leaders in science for centuries, are belatedly becoming hubs for start-ups, though they are close enough to London to share its housing afflictions. The most optimistic place I visited outside London’s orbit was Manchester, where growth has consistently been double the U.K. average. Downtown Manchester was once almost totally depopulated; today, approximately 100,000 people live there. After working hours in the city’s pubs, you will hear conspicuous southern accents: In 2024, more Londoners moved to Manchester than vice versa.

Manchester has succeeded in part because it gained some independence from the shambolic central government in London. In an experiment in devolution begun in 2011, London granted the city more power over taxes and transportation. The bus network was brought under public control, and a local £1 billion “Good Growth Fund” was set up to distribute investments across the city. Manchester, as a result, is now better able to set its own economic course. “You can’t order growth from the top down,” Andy Burnham, the mayor of Greater Manchester since 2017, told me. “The U.K., for most of our lives, has been an overly centralized country.”

Many Labour supporters wish that Burnham, rather than the hapless Starmer, was prime minister. But for that to happen, Burnham would first need to return to Parliament (where he had previously served for 16 years). He attempted to do so in January, when a parliamentary seat became vacant in Greater Manchester, but he was blocked by Starmer’s allies, who did not want to elevate a potential rival (already called the “King of the North”). In May, after Starmer’s grip on power had loosened even further, a Labour member of Parliament in Makerfield, another Manchester seat, voluntarily resigned to offer Burnham another avenue to challenging the party leader. He will not be blocked this time.

Yet Burnham’s path to power is not guaranteed. Even Manchester is not immune to the country’s anti-establishment mood. In Makerfield, recent elections have seen significant improvement for the Green Party, the populist left party on the rise in Britain. The Greens are run by Zack Polanski, a former hypnotherapist and a self-described “eco-populist” who wants to legalize drugs and implement a wealth tax. But the strongest performance has been put up by the Reform Party, the populist hard-right party that’s rising nationally even faster than the Greens.

Both of these parties, once relegated to the fringe of British politics, have done exceptionally well in recent national surveys. Reform has in fact been out-polling all the others for months—the first time in more than 40 years that neither Conservatives nor Labour has led. No matter who in the Labour Party replaces Starmer, presuming he resigns, Britain must hold another general election within the next three years. The odds-on favorite to be the next prime minister after that election is Reform’s leader. His name is Nigel Farage.

How could the prime instigator of Brexit now find himself in a position to be promoted to prime minister?

Farage is ascendant because he has an enticing answer to the question “Who broke Britain?”: the feckless elites, the ineffective civil servants, and the unwanted immigrants. Even if the country’s problems are beyond his capacity to solve, he at least can promise their reckoning.

I met Farage in March, right before he took the stage at a campaign rally in Milton Keynes, a commuter town outside London most famous for its many roundabouts. He and his merry band of insurgents were touring the country ahead of the local elections in May, in which Reform would gain some 1,400 municipal-government seats (30 percent of the total seats contested), while Labour would lose about 1,400 and the Tories about 500. Farage was in character: besuited, with a pink-and-purple tie immaculately matched to his shirt, and sporting his trademark Union Jack socks. When he leaned forward, I smelled tobacco and possibly a faint whiff of the pint of lager that he is so often pictured holding. He sunnily told me how he was preparing, upon his election, to wrest power from the deep state and deploy it to enact the will of the people. “We have to make sure within the civil service that we have people who are not willful obstructors,” he said: His government would not be like Donald Trump’s first administration, initially unsure of how to wield power, but like the second, ready to go from the start.

Several hundred people had come to see Farage speak. Political rallies in England are more civilized than the American ones I am used to: People drink pints before the event, sit patiently in chairs during it, and leave in an orderly queue afterward. After everyone took their seat, Farage delivered his speech, which was a rhapsody of declinism. “It is a period of complete political failure; economically, we’re going down the drain,” he said. Every current and recent political leader was to blame. The Conservatives had delivered Brexit too slowly, allowed mass migration anyway, agreed to net-zero-emissions commitments. Labour was responsible for Britain’s humiliation on the world stage, through its weak response to the war in Iran and its general dithering. The message was clear: Only Farage could fix it.

Farage’s plans to consolidate power, through a defanged civil service and constitutional reform, are detailed. Cuts to the civil service are not just being promised in a general way; a “Project 2025”–style ministry-by-ministry road map is being discussed by Reform’s allies. Quasi-constitutional laws that have restrained the power of the central government, such as the 1998 Human Rights Act and the 2010 Equality Act, will be redrafted. So will the 2008 Climate Change Act, which enshrined Britain’s net-zero commitments. Danny Kruger, a Conservative MP who defected to Reform last year and is now a part of its brain trust, told me that fixing the country’s problems requires first restoring parliamentary sovereignty. That would mean limiting the ability of independent government bodies to direct policy, and of courts to exercise judicial review on acts of Parliament.

Greater power for Parliament could indeed enable needed reforms. The accumulation of legal clutter is in no small part responsible for the country’s inability to build housing, infrastructure, and industry. And Parliament’s ability to self-govern, after decades of delegation to EU committees, has atrophied. Even after Brexit, a sort of learned helplessness has prevailed within the political class, Fred de Fossard, a former Tory political adviser now at the Prosperity Institute, told me. If Farage is elected, perhaps that will change. But Brexit proved that a sweeping assertion of sovereignty is by itself insufficient to ensure growth—and, indeed, can be self-harming.

Many of the details about how Farage would restore Britain’s place among wealthy nations, and a sense of opportunity for its people, are hazy. I asked him how he would spur the kind of strong economic growth that the Conservative and Labour Parties had failed to achieve. He answered by saying that he and his future ministers were successful businesspeople, unlike the current lot, and would therefore do better. The Reform Party has promised to slash government spending and national deficits, though it has promised to cut some taxes too. Farage told me that shock therapy for the British state would be necessary. “There is no question the state has to shrink in size, and this is going to be very, very tough,” he said, adding that he anticipates protests when he unveils plans to cut welfare benefits. “But if we don’t do it, we are going to go bust.”

Because of such statements, Reform is often accused of being austerity rehashed, or Thatcherism rewarmed. But Reform’s most specific economic pronouncements have largely been of the crowd-pleasing, non-Thatcherite variety: cutting fuel taxes, keeping the NHS free at the point of service, and preserving the “triple lock”—a policy effectively ensuring that state pensions increase faster than ordinary wages.

Being cryptic about hard economic choices is electorally advantageous, particularly when the general election could be years away. This was in fact the strategy that Starmer employed in his election campaign, repeating the word growth like a mantra without revealing how he would achieve it. His political capital proved fleeting. Reform may ascend to power only to find itself snared in the same trap. Still, even well-connected Westminster types who served in prior governments told me they did not really dread a Reform government. Reform, in their view, is the only party iconoclastic enough to attempt major structural repairs on the foundations of the British state and economy. “To believe that something is broken doesn’t mean that it’s irretrievably broken,” James Orr, a Cambridge theology professor who leads policy for Reform, told me. “But we think it’s becoming increasingly obvious that we’re the only political movement with a chance.”

The most detailed plans released by Reform involve immigration—the one issue that evokes as much anger among voters as living standards do. The Conservatives broke their pledges: Johnson promised to reduce the net inflow of migrants, but his policies, meant to bolster health-care staffing and stabilize falling university enrollment, led to the legal arrival of more than 3 million non-EU immigrants, who now amount to one out of every 25 people in Britain. Later, Prime Minister Rishi Sunak struggled to deal with the arrival of more than 150,000 migrants who’d crossed the English Channel on small boats. Even the current Labour government, sensing the anger in the electorate, has pledged to reduce migration.

It is on immigration that Farage offers the starkest choice. He has put Zia Yusuf, a wealthy businessman and the son of Sri Lankan immigrants, at the helm of his immigration agenda. Yusuf’s major policy pitch is “Operation Restoring Justice,” which calls for the deportation of all unauthorized migrants in Britain (through a new ICE-style agency called UK Deportation Command). Yusuf is the kind of zealous and paradoxical convert whom Reform, and other parties of the global New Right, revel in—a practicing Muslim who strenuously campaigns to keep churches from being converted to mosques. He is to Farage what Stephen Miller is to Donald Trump: a hard-faced nativist, always aware of the latest heinous offense committed by an immigrant and always warning of impending civilizational collapse—next to whom the boss looks moderate and relaxed. “Never again will British people be a second-class citizen in their own country,” Yusuf declared in a speech on the night I saw Farage in Milton Keynes. “Under a Reform government, His Majesty’s Parliament will be sovereign once again, and the rights of the great British people will reign supreme!”

Given the anger over broken border promises, it’s no surprise that Reform’s clearest message has been on restricting migration. It resonates because Britain’s economic failures have contributed to a growing cultural precarity, too. But unwinding migration is unlikely to solve Britain’s deepest woes—most of which are domestically manufactured, not imported.

With every disappointing year, with the failure of every backfiring government policy, the nostalgia for British exceptionalism has grown stronger. Restoration to global hegemony is impossible. Stabilization is achievable, but only if Britain’s next ruling class does something that its governments over the past two decades have not managed: stop choosing the self-harming option. Arresting the current trajectory of decline will require the recognition of a hard truth. What broke Britain was not Brussels, bad luck, or bankers. The British broke Britain. To mend it, they must first stop breaking it further.

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