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UK Prime Minister Keir Starmer’s rapid loss of political authority has been widely seen as a British peculiarity. But the same malaise can be found across other rich industrialized societies. Starmer may be a decent and intelligent man, but like so many other leaders today, he faces an impossible task: navigating the treacherous path between the bond market and populist political demands.
Starmer’s predicament tells a story not just about the UK, but about modernity — and how it went wrong. In the mid-20th century, the UK and all its peer countries had two big stable parties that engaged in civil competition, with the leaders of each treating their counterparts with respect. Generally, one party was slightly left wing, and the other slightly right wing. One tried to tax a little more, the other a little less. Both resisted ideological extremism, because they understood that moderation was the way to win over the median voter — the one who usually decided elections.
The UK leader is a throwback to this era. But the old assumptions no longer apply, because the combination of globalization, deindustrialization, media filter bubbles, and the end of the Cold War — a conflict that lent a degree of certainty and consistency to geopolitics — destroyed the old model. The political middle has disappeared, and voters are angry. Party leaders treat each other with contempt, ideological conflict is now the currency of politics, and the surviving old parties have been discredited.
Voters want — or believe they want — radical change. In the British case, the Conservative Party is losing ground to Nigel Farage’s Trumpian Reform party, while Starmer’s Labour Party faces a growing threat from a radicalized environmental party, the Greens.
Italy beat a path to this new politics long ago, with the fall of the Christian Democrats and the Communists in the 1990s. In France, the old left, the Socialists, and the old right, the Republicans, also grew moribund. However, President Emmanuel Macron’s new centrist movement kept populism at bay, at least until recently. And in Germany, the old mainstream parties, the center-left Social Democrats and the center-right Christian Democrats, are dwindling as the far-right Alternative for Germany rises in opinion polls.
But the British debate is even more fraught than these continental European cases. At its core is economic underperformance, the result of low productivity growth, which has festered and morphed into a crisis of national identity. Clinging to its legacy of empire, the UK is caught between working with the US and reintegrating with Europe. British voters narrowly rejected the EU in the 2016 Brexit referendum; but since then, the US has become an increasingly unreliable ally.
The UK is caught between working with the US and reintegrating with Europe.
Harold James
US President Donald Trump is right to point out that Starmer is no Winston Churchill. But is that such a bad thing under the circumstances? To channel Britain’s wartime leader, Starmer would have to urge his country give its blood, toil, tears, and sweat. But to what end?
Two candidates are being widely touted as potential successors to Starmer. One is Wes Streeting, a former health minister with a track record of successful reform, who has correctly identified Brexit as the primary source of the current instability. Nonetheless, he has struggled to devise a plausible solution.
The other contender is Andy Burnham, the mayor of Greater Manchester, who would first have to win a by-election to Parliament to throw his hat in the ring. His primary message is that the European option needs to be off the table, and he launched his campaign by declaring that the bond market should be ignored. While some of his proposed fiscal policies might boost growth temporarily, they would fuel inflation, debt, and ultimately a balance-of-payments crisis. Apparently recognizing these risks, he has already backtracked, saying that the country needs a framework of fiscal rules.
Thus, the Burnham campaign is reproducing the dynamic that led to disillusionment with Starmer, who likewise began with a commitment to orthodox fiscal policies, only to be forced to backtrack by revolts within his own party. Regardless of the candidate, the choice is the same: Either offer a clear message on external political alignment — with the US or EU — that ruffles feathers, or declare that Starmerism is the only politically plausible path.
Is there a way out of this predicament? The problem with any populist option is that it depends on a type of magic trick, conjuring benefits for constituents usually at the expense of other countries or foreign bondholders. But since small and medium-size countries cannot manage effectively on their own, populism cannot be sustained.
By contrast, larger political units are less vulnerable to the corrective power of bond markets — though the EU is rightly aware of the limits, and the US is making itself strikingly vulnerable through its dependence on financing from the rest of the world. Fiscal unions and even political mergers will likely emerge as a key to stability.
In fact, one such precedent involves Churchill. In June 1940, as France was collapsing under the German invasion, the British leader set out a “Declaration of Union” between the two countries — an idea spearheaded by Jean Monnet, the father of European integration. Although the initiative failed to go anywhere, French Prime Minister Guy Mollet briefly tried to revive the proposal in 1956 during the Suez crisis — an obvious analogy to the current geopolitical moment.
Earlier generations of European and British leaders understood something that many today have forgotten. Whether you are placating bond markets or standing up to a foreign bully, there is strength in numbers.
• Harold James, Professor of History and International Affairs at Princeton University, is the author, most recently, of ‘Seven Crashes: The Economic Crises That Shaped Globalization’ (Yale University Press, 2023).
©Project Syndicate
