Why Burnham might be better off aligning with the US – not the EU
A.Former deputy cabinet secretary Helen MacNamara said ndy Burnham’s promise to move closer to the EU could see Britain “back to 70% of where we were 10 years ago”.
Mr Burnham, who will become prime minister on July 20, has previously said he wants to ‘consolidate the progress made in current UK-EU negotiations’ and ‘strengthen UK-EU cooperation on illegal immigration and economic security’. The former mayor also promised ‘growth in every postcode’ and laid out plans to devolve government powers to local governments.
In the latest episode of In The Room, Helen and former No.10 special adviser Cleo Watson explain that if Mr Burnham sticks to his pro-devolution and pro-EU stance, he could make his own life difficult amid major pre-existing economic difficulties.
Listen to the full episode:
“You want to delegate all the authority, but you also want to be able to pull the levers and achieve growth now.” Helen explains. “There’s tension and choice between those two things. They’re not compatible.”
Cleo stressed the importance of positive growth for Labor that people can actually feel, rather than the lip service that defined Starmer’s premiership. “There’s no point in putting out some numbers for people. The question is: Can you make the average Briton feel better?”
“The thing is, our situation as a European bloc is not that bad. We’re just on a very stagnant continent. Surprisingly to me, we’re doing better than Germany, which Andy Burnham portrays as a perfectly developed federalist state. It’s a bit worrying that its growth plan has objectively failed.”
“From an export perspective, our economy has been geared to export to the EU for a long, long time,” says Helen. “And that’s much more complicated because of Brexit. There are very, very strong voices in the Labor Party who say we need to get as close to the EU as possible now to rebuild the economy in the short term. And that will probably make a difference to some of the figures.”
“But the problem with this election is that we will be adjusting ourselves to a part of the world economy that is simply not growing.”
GDP and employment across the EU are slowly rising but are also significantly outpacing the US, the UK’s biggest export partner. The US is also the largest national investor in the world for the rapidly developing AI industry; By investing 100 billion dollars in 2024, it has invested 10 times as much as the second-ranked China. Helen says the US is “seismically important from a digital perspective.”
“All these new parts of the economy are not coming back to the EU. There are some pretty tough choices there. Do you try to relax some things out of sentiment or short-term pragmatism and then maybe get back to 70% of where we were 10 years ago in some services, in some exports?”
“Or do we say, ‘We actually need to double down, go further, get more in line with the parts of the world economy that are actually growing and are likely to continue growing over the next 10 years?’ It’s a difficult and very brutal choice.”
Listen to the full episode in the room, ‘Will Burnham make you richer?’ Apple Podcasts or Spotifyor watch YouTube.
