Did I expect former Defence Secretary John Healey to become Chancellor of the Exchequer? No. His recent political background is not in economics,, although he was a Treasury minister under Tony Blair and Gordon Brown. We have to go that far back to find what he thinks.
To do that, I had to resort to several AI sources (Google, ChatGPT, Claude and Perplexity) and this is what I got, with a few edits by me (and with my caveats in parentheses and italics):
- John Healey is best described as a Brownite social democrat. He is not a neoliberal (although I am not convinced by that), and nor is he a heterodox economist.
- He supports an active role for government in shaping markets, investing in public services and promoting economic development.
- However, he accepts the established Treasury framework, including:
- Fiscal rules.
- Financial markets as a constraint on government.
- Orthodox approaches to public borrowing.
- Bank of England independence.
- Building credibility by reassuring investors and financial institutions.
- He seeks to change priorities within the existing framework, not the framework itself.
- His past priorities have included:
- More housing.
- Greater regional investment.
- Higher defence spending.
- Unlike Andy Burnham (possibly) and economists associated with modern monetary theory, he does not challenge the underlying assumptions of UK macroeconomic policy.
- He is primarily a policy and administration politician, focused on improving government performance rather than reforming economic institutions or theory.
- He belongs to the Labour tradition established under Gordon Brown: an interventionist state operating within fiscally orthodox rules.
- His disagreements with Conservatives are generally about the scale and priorities of public investment, not the architecture of economic policy.
- Overall, Healey supports a more active government than Conservatives typically advocate, but does not appear to believe that the UK's macroeconomic framework requires fundamental reconstruction.
That last line is the killer. As I said in this morning's video, to succeed, Burnham has to break the fiscal rules. He has chosen a Chancellor who is very unlikely to do that. Burnham will fail in that case. No other outcome is possible.
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This interview from 2021 gives a flavour of his priorities and thinking.
“The central feature of that 13 years of Labour government was that the Treasury was the driving force. That was imperative to the qualified success that we had. Without that, we probably would have made very little headway”
Most of the interview is about his championing of regional development boards. I suspect that this is why Burnham has appointed him with his devolution agenda.
https://sites.harvard.edu/uk-regional-growth/directory/john-healey/
Thanks
‘Keep you friends close and your enemies closer’ – Sun Tzu?
My hopes for the future by-pass this development – but we’ll see.
Could have been a lot worse.
It will probably go to s**t, but I’m going to see what happens.
“Always look on the bright side of life”.
All this is no doubt true, but I do find it somewhat entertaining that the man who insisted the Treasury should have found him the money he requested for defence has been handed the keys to the Treasury and told, in effect, “ok, you find the money”. Bluff, called.
Household analogy fans always miraculously find the money they need for either their own priorities or the latest unavoidable crisis/war/pandemic.
What they perhaps don’t realise, is that the more often they do it, the more damage they do to the sandy foundations of their economic orthodoxy.
When the public see that 3% has been found for military expenditure, they are likely to ask, “but I thougt we couldn’t afford it?”. Again.
I see Streeting has become Defence Secretary – the MOD/Treasury/Downing St. relationship could be interesting to watch.
Agreed
Putting Healey in as chancellor is the classic cute move.
Healey wants defence better funded and now he has to figure out how to make it happen.
In truth even if Burnham wanted to break the status quo economics (and I sincerely doubt that) he would probably be unable to do so.
Neoliberalism has created monsters so powerful they can (and will) sabotage the economics of any nation that attempts to serve its populace.
I disagree
Change is always possible
Now that we have created such powerful interests outside of nation states that wield dark propaganda on a scale beyond anything previously encountered they can turn an entire populace against its government and topple it with ease.
Whether this is done by creating adverse economics or smear or other, the end result is the same: a new government that will toe the line.
This climate makes meaningful change a fiendishly difficult proposition even for the cleverest (and most moral) minds and we have none of those in the Westminster system.
Neoliberalism is a clever enemy and was always designed as a trip with no return ticket, like a singularity with an event horizon.
I find this upsetting and depressing but whenever I sit and examine ways for the UK to break out of this disaster (given the various limitations that exist) I cannot see a path that these powerful interest could choke off with relative ease.
These are indeed the darkest days of my life and the worst of the worst is waiting like a ghoul in the shadows (Reform) to finish us off.
I hope I can add some hope….
On the other hand Miatta Fahnbulleh describes herself as a heterodox economist, there is hope.
She does seem to be one to watch, as long as the established economists don’t tear her down first.
Thoroughly underwhelmed by the appointments, or in the case of Mahmood and Nandy, oh dear. It looks like son of HuffnPuff, Steve Kinnock, may get Welsh Sec. He was, of course, the one who blanched the most in 2017 as Corbyn came close to a win. A pile of neolibs, with the slight exception of Miliband – who nevertheless isn’t the man his dad was.
Well, that’s some right wing government coming our way in 3 years time. I despair. Another wasted opportunity. No different to Kid Starver other than moving the deck chairs on the Titanic.
On a more positive note, thank you Richard for everything you do. Best wishes for a full recovery and best wishes to all of your family
John Healey yesterday: “Fiscal discipline is the first duty of a Chancellor”.
Not to use fiscal policy and monetary policy (after scrapping the current MPC) to steer real national resources in support of the Government’s strategy.
No, first you have to ‘balance the budget’. Only after that can you think about what is good for the country.
Why are they so stupid? Don’t they realise that no matter what they do and say, despite all evidence to the contrary, swathes of the country will always view them as the party of fiscal irresponsibility. So stop pandering and start doing right for a change.
Hmm. Healey. Brings to mind a certain previous Chancellor of the same name who thought he had to borrow from the IMF. No relation, I understand.
At least I am pleased to see that Miatta Fanbulleh, who was the first minister to resign from the Starmer fiasco, has been raised from under-secretary to cabinet level, and I believe she is one of Burnham’s economic advisors. Maybe a crumb of hope there?
I hope so. She has a brief that should suit her.
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