A number of stories suggest a common thread this morning.
Elon Musk has walked away from Trump and the US government, having very obviously failed. And now he's turned on Trump (as I predicted he would, a while ago) and his 'Big Beautiful Bill', calling it an abomination.
Admittedly, it seems he has done so because of a debt obsession: he either thinks the USA cannot afford the cost of the tax cuts Trump is planning, or he thinks the spending cuts do not go far enough, despite his failed efforts, but either way, he and Trump are no longer in the same space.
Why is that? It's because running government is complicated. As he has admitted, it is much more complicated than he thought it would be. The result is that there is considerably more nuance required in political decision-making than Musk had appreciated. The simple criteria used by business (will it make money, do the bosses like it, and does it make them feel good?) are wholly inadequate when it comes to politics.
KKR appear to have learned the same lesson over the last few days. They put in a proposal to buy Thames Water late last week, and yesterday they withdrew it. The FT notes:
One person close to KKR said that it had not been able to thrash out a deal given the complexity of the situation and the “multiple stakeholders” involved.
I decode that as a suggestion that this was just all too complicated to get their heads around. I might be wrong, but that's how it reads to me.
Meanwhile, Sir John Cunliffe set out his interim report from his so-called Water Commission, which was allowed to consider every option for water, except the only one that is viable, which is nationalisation. The goal he was asked to secure was a simple solution, not involving government. But, the simple fact is that when water is fundamental to human life, it has to be a matter in which government is involved.
If the task of a government is protecting its population (and Keir Starmer seems to think it is, if only by being willing to fire missiles against unnamed enemies) and water is literally fundamental to human life, to pretend that the government has no role in its supply is absurd.
So, why is there this pretence that the government should have no role? That's because the reality is that supplying water is complicated, and politicians really do not want to have to do things that are complicated. If things are complicated, they want to walk away from them, as KKR have done.
As KKR have noted, there are multiple stakeholders who have to be kept happy when it comes to water, and that is hard.
This should not be news to anyone, but apparently it is to all involved, including our politicians, who, like their private sector counterparts, think there must be simple solutions to all problems, because that is what the (relatively) simple models of economists imply to be the case.
But those models are wrong.
They are built on the basis of assumptions that deny that most stakeholders exist.
They make a presumption that 'all other things are equal', or unchanged (the 'ceterus paribus' assumption believed by economists) by any decision being considered, so that they might reduce the number of variables that have to be considered when modelling such processes. That makes the maths manageable. However, it also means that economists assume away the reactions of stakeholders to decisions taken by business and politicians, which then suggests the decision-making processes that they are engaged in are much simpler than they actually are.
Those without the power to think for themselves, or who have only lived in worlds where executive power has let them pretend that such assumptions might hold true, are conned by economists into thinking these approaches are valid. They, as a result, think that the economists who have no real world experience who create these models are describing how the world really is, when nothing they say even vaguely approximates to the requirements of real world decision making, most especially when it comes to government, where there will always be considerable numbers of stakeholders in play at any time.
By the time those who secured political power based on these naive beliefs about decision making learn how wrong they have been, which is usually after some time in political office, they have almost invariably done so much political harm that it is too late for their careers to recover, and for them to do any good, even if they were capable of doing so.
Musk has trashed his reputation for good.
Reeves is over.
Starmer will fall with her, probably in the next year.
Almost every neoliberal who has claimed they can simplify government falls into the same trap.
Government is complicated.
Meeting needs is complicated.
Reconciling conflicting aims is complicated.
Most of the time, businesses just pretend these issues do not exist. That's why so many of them fail.
That's why business is nothing like as difficult as government. When it is, it can just walk away, moving on to the next thing.
Governments cannot do that. When the world realises that, then we might get better government. We might get better government decision-making, because we will realise it is nothing like business decision-making. And then we might move on.
Until then, we're stuck with people who have not the slightest idea what they're doing, or how to do it. No wonder we're in a mess.
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Meant to post this yesterday, Richard, so you may have watched it, but this is the most powerful and damning (and genuinely moving at one point) segment of TV you’ll perhaps see on Musk. It’s from Lawrence O’Donnell on Monday evening: https://www.msnbc.com/the-last-word/watch/lawrence-on-usaid-cuts-with-musk-and-trump-soulless-mindless-entities-are-what-you-see-240759365712
I’d particularly draw attention to a long running theme in O’Donnell’s reporting, which is the White House Press Corps unwillingness to challenge Trump (and any one of his lakeys) on any issue, such that he gets away with stuff that no other politician – EVER – would have been allowed to get away with. When history is written about Trump I strongly suspect that this body and people, and the MSM in general, will rightly be criticised to the hilt for being Trump enablers.
Also this segment from yesterday evening, now that Musk has decided that he and Trump weren’t mates after all (and that only took a day). https://www.msnbc.com/the-last-word/watch/lawrence-and-on-day-134-musk-turned-against-trump-240844357521
I’d strongly recommend anyone with an interest in US politics to watch both. You won’t regret it. This is how current affairs journalism should be done (ditto Rachel Maddow, with Chris Hayes and Ari Melber not far behind). Shame on the state of journalism in this country that nobody comes close to these MSNBC people.
Thanks Ivan…
Well, as Bernie Sanders commented, ‘Musk is right: this bill IS a ‘disgusting abomination.’
There is also a HoL Industry and Regulators Committee report out today, ‘Power struggle: Delivering Great Britain’s electricity grid infrastructure’. Mike Parr’s thoughts would be useful here. A fast read through suggested focus on the huge infrastructure requirements (money); reminding us the Fiscal Rules have to go. Every day we find that over the last forty years Neoiliberalism has been funded by running everything into the ground, leaving us trapped in a hollowed out, sham economy.
I was also interested in the Zonal Pricing proposal (very attractive for Scotland, and Scotland’s potential for relocation of advanced technologies like AI).
“In theory, zonal pricing would lower the price of electricity in areas of excess supply aiming to incentivise consumers, particularly large energy-intensive businesses, to locate closer to generators. Conversely, areas of high demand and low supply would have higher prices, incentivising electricity generators to build additional supply there. The aim of this reform would be to reduce the waste of excess renewable generation that the grid cannot transport elsewhere and decrease the need for additional grid expansion by locating generators and energy-intensive consumers closer to one another.This would aim to contribute to a reduction in system costs and lower bills for consumers.” (p.21)
With Zonal Pricing data centres or electrolysers, would be attracted to locate in Scotland with obvious economic benefits. If Zonal pricing doesn’t happen, there is another way to fix this. It is a reminder that economically Scotland will be better off independent, and able to develop its own transmission network; and very profitably export energy to England.
KKR have 25% of the shares in Northumbrian Water, so they have always known about other shareholders in the industry.
That’s just an excuse to get out of a difficult situation with Thames Water.
There is also a HoL Industry and Regulators Committee report out today, ‘Power struggle: Delivering Great Britain’s electricity grid infrastructure’. Mike Parr’s thoughts would be useful here. A fast read through suggested focus on the huge infrastructure requirements (money); reminding us the Fiscal Rules have to go. Every day we find that over the last forty years Neoiliberalism has been funded by running everything into the ground, leaving us trapped in a hollowed out, sham economy.
I was also interested in the Zonal Pricing proposal (very attractive for Scotland, and Scotland’s potential for relocation of advanced technologies like AI).
“In theory, zonal pricing would lower the price of electricity in areas of excess supply aiming to incentivise consumers, particularly large energy-intensive businesses, to locate closer to generators.149 Conversely, areas of high demand and low supply would have higher prices, incentivising electricity generators to build additional supply there.150 The aim of this reform would be to reduce the waste of excess renewable generation that the grid cannot transport elsewhere and decrease the need for additional grid expansion by locating generators and energy-intensive consumers closer to one another.This would aim to contribute to a reduction in system costs and lower bills for consumers.” (p.21)
Labour will not let Prem Sikka near this committee, I am sure.
I recommend Carol Cadwaller’s latest substack post on Musk, and how his job is done. The data he stole is now in the hands of Peter Thiel, ready for his digital concentration camp project. As for the split between Trump and Musk, you are right, it was inevitable. The Maga camp is full of conflicting ideologies. The religious right have to dispense with all Christian values to support Trump, and the Far Right element of Maga, Bannon, Hegseth, those sorts, are opposed to the tech bro libertarians like Musk, Vance, etc. My money is on the side that has a billionaire with the CIA in his pocket. The tech bros are coming for the UK as well, and Starmer doesn’t stand a chance.
You’re right that the MAGA Camp has conflicting ideas, but Evangelical Christians who support Trump do not dispense with Christian values to support Trump, they have a different view as to what those values are to you.
“Those whites who have a strict father personal worldview and who are religious tend toward Evangelical Christianity, since God, in Evangelical Christianity, is the Ultimate Strict Father: You follow His commandments and you go to heaven; you defy His commandments and you burn in hell for all eternity. If you are a sinner and want to go to heaven, you can be ’born again” by declaring your fealty by choosing His son, Jesus Christ, as your personal Savior.
Such a version of religion is natural for those with strict father morality. Evangelical Christians join the church because they are conservative; they are not conservative because they happen to be in an evangelical church, though they may grow up with both together.”
Understanding Trump (2016), George Lakoff
The core commandment of Christianity for human affairs is ‘Love one Another’.
The Uk is trying to run a 21st century economy on a governance model dating from the restoration of the monarchy. It is beyond unable to cope with the complexity of today’s world.
What is needed, IMHO, is a federal structure with power dispersed to the nations and regions. House of Lords and Privy Council replaced by an elected People’s Council with power to set its own agenda. One parliament replaced by five legislatures plus the People’s Council. People to have the right to put topics on the democratic agenda.
And all four nations to be sovereign, excepting defence, foreign affairs, and common standards, with each having the right to leave if 50% of their electorate vote thus.
Ceteris Paribus
Ok….if you insist
Perhaps the most complicated problem they need to address is how to restore confidence in Government! And they can’t privatise that one.
I don’t know the king could let out a contract to run the government. I hope that no neoliberal is reading the blog.
Unfortunately, they have thought about privatising government. One variation mentioned by Naomi Klein around 14:55 in here https://www.youtube.com/watch?v=XtYSyb6fCxo
Musk is definitely turning against Trump and he is not alone.
https://www.huffpost.com/entry/elon-musk-disgusting-abomination-big-beautiful-bill_n_683f334ee4b0908fdbe0b7e4?utm_source=cordial&utm_medium=email&utm_campaign=hp-us-reg-morning-email_2025-06-04&utm_term=us-morning-email&email_hash=b3fae7b79ac6422f8a1986dbd68f9fa82f89f01a
Footnote: I know Rand Paul
Do we offer commiserations?
Yes . . . on a violin shorter than the Planck length.
Bluntly, we are running out of time on all fronts with compromised corrupt dolts in charge. The worst bit of it all? The lack of insects clogging our windscreens in high summer. When the bees die, the human story is over.
If it didn’t have such serious ramifications, I’d see this falling out as 2 bald men arguing over a comb.
Today was a fresh wind day in Scotland.
the grid was taking 5200MW, 5.2GW most of the day, from wind generation, plus 400MW to Northern Ireland by dc cable.
Fuel cost? negligable.
Data source? the grid dashboard.
Then we see, 3GW transfer to Europe via the dc cables to them.
WFA? why not fix the elephant in the room? We are charged asif this energy was produced by burning gas or cat litter at Drax, wood pellets imported from theAmericas.
@ davestewart,
If you’re paying attention to that kind of data, maybe this will be of interest:
https://www.eldiario24.com/en/largest-scotland-energy-underwater-technology/5488/
Not sure about the Musk thing.
As I posted elsewhere earlier:
“This might be how Project 2025 is going to move Trump out to enable them to substitute Vance. 180 days is nearly here.
This is no epiphany on the part of Musk – but this could be about discrediting Trump and letting his instability take him into impeachment.
Trump expects his bill to pass, perhaps with some tweaks, but to pass, nevertheless.
But if it is killed, it seems unlikely that he would hold it together mentally, even in Trumpian terms, in the face of the destruction of his showpiece.
And his authority would be in question because of the failure of the BBB.
Under those circumstances, it might only be a matter of time before Amendment 25 was brought into play.
https://www.desmog.com/2025/05/30/elon-musks-government-legacy-was-enacting-project-2025-his-ties-go-back-years/
”
It could be that this apparent volte-face has more to do with Russell Vought than might at first be apparent.
I found my copy of Aneurin Bevan’s ‘In Place of Fear’ today with a bookmark at this passage, where he speaks of the dangers inherent in a laissez-faire society:
‘It has often been said that when revolution threatens, nations go to war, but that is too simple and rationalised a view. It does not do justice to what in fact happens. I have seen the alchemy at work too often not to appreciate the intensity with which relief is sought from a threatening situation, and from the burdens of intellectual choice. It is the same impulse that makes men shout for unity when faced with the need to resolve some painful and legitimate difference of opinion.
This mood is always difficult to resist because it does not arise from a rational analysis of the problem. On the contrary, analysis is what people want to avoid because it would lay bare the divisions which led to the tensions in the first place.’
I think he has a point. This seems pertinent to many things going on today. His book is back on my book-pile.
I have a copy, because it’s a book that set the tone for a change in society. Few do.
… Bevan’s assertion that “This is the real crisis in democracy. People have no use for a freedom which cheats them of redress. If confidence in political democracy is to be sustained, political freedom must arm itself with economic power” could have been written today. I can only hope that someone, somewhere in Government is listening to you, Richard.
The government has said it would cost £100 billion to nationalise Thames Water.
It won’t
And it was totally crass of them to say it would
Bust companies are worthless