{"id":415262,"date":"2025-11-29T19:06:06","date_gmt":"2025-11-29T18:06:06","guid":{"rendered":"https:\/\/climatescience.press\/?p=415262"},"modified":"2025-12-17T22:24:49","modified_gmt":"2025-12-17T21:24:49","slug":"the-book-that-rachel-reeves-should-read-before-her-budget-but-wont","status":"publish","type":"post","link":"https:\/\/climatescience.press\/?p=415262","title":{"rendered":"The Book That Rachel Reeves Should Read Before Her Budget \u2013 But Won\u2019t"},"content":{"rendered":"\n
\"Portrait<\/figure>\n\n\n\n

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From Tilak\u00b4s Substack<\/a><\/p>\n\n\n\n

By Tilak Doshi<\/a><\/p>\n\n\n

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\"A<\/figure>\n<\/div>\n\n\n

The Autumn Budget is usually the largest fiscal event of the year, laying out the Government\u2019s taxation and spending priorities in the coming year. Chancellor\u00a0Rachel Reeves<\/a>\u00a0will deliver her second\u00a0Budget\u00a0<\/a>at around lunchtime on November 26th, after Prime Minister\u2019s Questions. The economic backdrop to this Budget is dire to say the least.<\/p>\n\n\n\n

Labour promised in its \u2018Change\u2019 manifesto<\/a> last year to \u201ckickstart\u201d the economy in order to \u201csecure the highest sustained growth in the G7 \u2013 with good jobs and productivity growth in every part of the country, making everyone, not just a few, better off\u201d. However, a senior Cabinet Minister admitted<\/a> Britain is facing a \u201cgrowth emergency\u201d ahead of the Chancellor\u2019s Budget. Earlier this year, a leak<\/a> revealed the broad trajectory of the Office for Budget Responsibility\u2019s (OBR) upcoming growth forecasts, which were due to be published alongside Chancellor Rachel Reeves\u2019s second Budget.<\/p>\n\n\n\n

The leaked information indicates that the OBR has downgraded its growth projections for the UK economy from 2026 to the end of the current Parliament in 2029, its most pessimistic economic growth forecasts in 15 years. Britain\u2019s growth potentially will be as low as 0.1% in some years, significantly worse than the previously forecast peak of 1.9% for 2026. Ms Reeves is expected to raise taxes to fund an expected \u00a320 to \u00a330 billion hit to the public finances from the OBR\u2019s weaker growth outlook and higher debt costs.<\/p>\n\n\n\n

Experts and business leaders warn that proposed Budget measures, such as a mansion tax and bank levy, could further hinder economic growth. Ed Al-Hussainy, an interest rate strategist at Columbia Threadneedle, an asset manager, said: \u201cThe biggest obstacle the Labour Government has is, first and foremost, growth. It\u2019s had the bad luck of not being in a high-growth environment, and whatever policy levers that it\u2019s pulled over the last 12 months haven\u2019t worked.\u201d<\/p>\n\n\n\n

So, modest as prospects are for the next few years, they are now worse. Yet, the Government has overseen the country\u2019s highest borrowing costs since 1998. The yield on 30-year Government bonds (gilts) hit 5.723% in September 2025, marking a 27-year high and surpassing previous peaks from earlier in the year. This surge reflects growing investor concerns over the UK\u2019s fiscal outlook, economic stagnation and the Government\u2019s ability to manage its debt. The situation has intensified pressure on the Chancellor to consider tax increases and spending cuts in the upcoming Budget as she faces disgruntled voters, rebellious members of her own political party and anxious bond investors.<\/p>\n\n\n\n

How to Return to Growth<\/strong><\/p>\n\n\n\n

Against this horror-show backdrop, there are moments in a nation\u2019s life when a book appears with almost perfect timeliness \u2014 a work that seems to speak directly into the storm gathering overhead. Jon Moynihan\u2019s Return to Growth<\/a><\/em> is such a book. Published in two dense, forensic volumes, it arrives just as the new Labour Government prepares to unveil its first Budget this week under a stagnant economy and an anxious public bracing for yet more taxes, more regulations and more sermonising from the state. If the UK is indeed, as many analysts increasingly warn, hurtling toward an IMF-style reckoning \u2014 a \u2018doom loop\u2019 where soaring debt service costs feed a falling currency which in turn feeds yet higher borrowing costs \u2014 Moynihan\u2019s two volumes may prove to be the most important diagnostic manual and treatment plan available to any leader willing (and more importantly, able) to avert national decline.<\/p>\n\n\n\n

Moynihan is too modest by half. Though he insists he is not an economist, he displays in these pages a keener analytical mind, a broader historical grasp and a deeper practical sense than most professors of economics in Britain\u2019s universities. A businessman, venture capitalist and consultant by background, unencumbered by academic groupthink, he slices cleanly through the muddled orthodoxies that have trapped the UK and wider Western Europe in decades of low growth, over-regulation, bloated government, moral panics and fashionable ideologies. His thesis is simple, devastating and urgently needed: Britain \u2014 once one of the world\u2019s greatest engines of prosperity \u2014 has allowed itself to drift into the torpor of social democracy, where high taxes, high public spending and a suffocating regulatory state have crushed dynamism, productivity and growth.<\/p>\n\n\n\n

As the Budget looms and the Chancellor of the Exchequer Rachel Reeves\u2014 \u2018Rachel from Accounts\u2019, as some wryly call her \u2014 prepares to lean further into the very policies that caused the problem, Moynihan\u2019s book is essential reading for any leader hoping to rescue Britain from its accelerating descent.<\/p>\n\n\n\n

The Argument: Why Growth Matters \u2014 and Why We\u2019ve Lost It<\/strong><\/p>\n\n\n\n

Moynihan structures Volume I around three pillars: the size of government, the rate of taxation and the quantity of regulation. These are not abstract economic variables. For Moynihan, they constitute the very architecture of national prosperity or decline. Across Europe, where the social-democratic model has ossified into dogma, the results are clear: barely any growth per capita for two decades, rising welfare commitments and failing public services. These are not steady-state economies. They are \u201cbarely ticking over\u201d, unable to generate the surpluses required to sustain the very welfare state voters cling to. The system is, in his words, unstable and unsustainable.<\/p>\n\n\n\n

The grounding for this analysis is laid out starkly in Moynihan\u2019s first chapters. Economic growth, he argues, is not merely an instrumental good \u2014 it is a moral imperative. The idea that affluent societies can flirt with \u2018degrowth<\/a>\u2018, one of the more esoteric imports of luxury-belief elites, is savaged with statistical precision and moral clarity. Degrowth will not save the planet. In a zero-sum society, where anyone becoming richer can only be based on someone else becoming poor, it would condemn billions to shorter lives, greater disease and deeper poverty. The past two centuries of rising lifespans, falling infant mortality, dramatic expansions in material comfort and human flourishing \u2014 none of this was produced by central plans, socialist regimes or government \u2018industrial strategies\u2019. It was the outcome of private enterprise, competitive markets and innovation unfettered by dirigiste political fantasies. Government\u2019s role in this remarkable ascent was simple: it got out of the way<\/em>.<\/p>\n\n\n\n

Yet Britain, like much of Europe, has forgotten this lesson. Wagner\u2019s Law \u2014 that public expenditure grows inexorably as societies grow wealthier \u2014 has combined with political incentives to produce a state swollen well beyond its productive capacity.<\/p>\n\n\n\n

Politicians purchase short-term popularity with long-term unaffordable commitments, leaving future governments to pick up the bill. Moynihan points out the brutal arithmetic: as public debt rises, servicing it consumes an ever-greater share of national output. Britain is among the most indebted of developed nations, spending over \u00a3100 billion a year simply to stay afloat. The UK\u2019s debt-to-GDP ratio is now hovering near 100% \u2014 a level unthinkable two decades ago.<\/p>\n\n\n\n

Against this background, Moynihan introduces core concepts that any first-year economics student should know but most politicians pretend do not exist: the Laffer Curve, the growth-destroying dynamics of over-taxation; the deadweight loss of regulation; and the devastating consequences of debt compounding over time. Taxes and regulations do not simply reduce growth at the margin \u2014 they can smother entire sectors, drive investment offshore and hollow out the entrepreneurial energy of a nation. Britain\u2019s creeping descent into this condition is now unmistakable.<\/p>\n\n\n\n

What Really Kills Growth: The Regulatory Hydra<\/strong><\/p>\n\n\n\n

Of Moynihan\u2019s three villains \u2014 big government, high taxes, excessive regulation \u2014 it is the third he reserves his sharpest criticism for. Excessive regulation, he writes, is \u201cwhat really kills growth\u201d because it destroys not only present output but future possibilities.<\/p>\n\n\n\n

The chapters on regulation are among the most powerful in the entire two-volume work. Here Moynihan synthesises themes as disparate as Net Zero, DEI ideology, ESG compliance, planning constraints, housing distortions, moral panics over mental health and climate change, and the metastasis of bureaucracy. What unites these trends is the relentless shift of power from ordinary citizens and businesses to regulators, quangos, civil service activist-bureaucrats and ideological networks.<\/p>\n\n\n\n

Net Zero, for instance, has grown into \u201ca festering mass of regulation, regulatory evasion, subsidy seeking and dodgy claims of success\u201d. London\u2019s Mayor Sadiq Khan \u2014 chair of the C40 network<\/a> \u2014 emerges as a central symbol of this overreach, promoting policies that would choke off economic growth by restricting transport, mandating lifestyle changes and imposing severe limits on travel, clothing consumption, meat and housing. The C40 vision, in Moynihan\u2019s telling, is nothing less than an agenda of enforced austerity disguised as planetary virtue.<\/p>\n\n\n\n

The same dynamic emerges with DEI and ESG. Moynihan recounts with mordant humour the disastrous McKinsey report<\/a> that purported to prove that diversity produces superior corporate performance \u2014 a study later debunked<\/a> as unreproducible and empirically flimsy. But such evidence scarcely matters. Corporate HR departments have embraced DEI with the fervour of a state religion, consuming managerial time, institutional focus and financial resources \u2014 all to pursue ideological goals that undermine meritocracy, chill free speech and distract from the only purpose of business: to serve customers.<\/p>\n\n\n\n

These are not small matters. Such regulatory overreach clogs the arteries of economic life. When house-builders must navigate habitats regulations protecting bats while mass immigration inflates demand for new homes; when landlords are harassed for failing to meet impossible Net Zero requirements; when the City of London \u2014 once an engine of global finance \u2014 is paralysed by anti-fraud regulations that produce little reduction in fraud, one begins to see the cumulative effect Moynihan warns of. Britain is turning into a high-cost, low-growth, bureaucrat-dominated economy.<\/p>\n\n\n\n

None of this is incidental. All of it is political.<\/p>\n\n\n\n

Europe\u2019s Fatal Conceit \u2014 and Britain\u2019s Addiction to Planning<\/strong><\/p>\n\n\n\n

Moynihan frames his critique in a deeper philosophical and political context in Volume II. The Western world, he argues, has succumbed to what Friedrich von Hayek famously termed the fatal conceit <\/em>\u2014 the belief that wise technocrats can manage complex economic and social systems from the centre. Whether dressed in the language of industrial policy, environmental planning, social-justice objectives or \u2018strategic sectors\u2019, the conceit remains the same: government knows best. Reality repeatedly proves otherwise.<\/p>\n\n\n\n

The UK\u2019s ongoing delusion that Net Zero-driven central planning will deliver prosperity is the most glaring example. Britain, uniquely in the developed world, has legislated itself into an energy trap where its own abundant onshore and offshore gas reserves lie unused while it imports gas from the US and Qatar at multiples of domestic cost. Nuclear power \u2014 the cleanest, densest, most reliable source of energy known to man \u2014 is regulated to the point of paralysis, with new reactors costing four to five times what they cost in South Korea or the UAE. The result? Soaring electricity prices, energy-intensive industries shutting down, blackouts looming and vast wealth transfers from households to subsidised renewables (wind, solar and batteries).<\/p>\n\n\n\n

Meanwhile, China \u2014 the world\u2019s industrial superpower \u2014 approves the building of two coal plants a week and continues to dominate solar and wind energy supply chains. Yet Britain blithely continues punishing itself in deference to a global virtue-signalling contest it cannot possibly win.<\/p>\n\n\n\n

This is not merely bad policy. It is suicidal policy<\/a>.<\/p>\n\n\n\n

Immigration, Education, Planning \u2014 The Structural Roadblocks<\/strong><\/p>\n\n\n\n

Appendix A of Volume I offers one of Moynihan\u2019s most candid interventions: his brief discussion of education, immigration and planning. Here he notes problems so entrenched that no government of the past 30 years has dared to confront them.<\/p>\n\n\n\n

Teachers\u2019 unions have captured the education sector, ensuring that reforms serve their interests rather than those of children. Mass immigration \u2014 which the OBR insists is always an economic good \u2014 is revealed as a fiscal and infrastructural burden given the UK\u2019s high-welfare model. Moynihan is clear: the gross inflow matters more than net migration. Highly skilled, high-earning Britons are leaving, replaced by low-skilled dependants drawn to generous social benefits. A country cannot grow when its most productive citizens depart and its least productive arrive.<\/p>\n\n\n\n

Planning is the final disaster. From housing constraints to bans on drilling, Britain has wrapped itself in environmental protections and NIMBY dogmas that strangle economic dynamism.<\/p>\n\n\n\n

To implement any of the reforms he recommends, Moynihan argues, the UK would have to leave the European Convention on Human Rights and rewrite its equalities legislation. The likelihood of this under the present Labour Government is, in his view, vanishingly low.<\/p>\n\n\n\n

A Blueprint for Renewal \u2014 If We Can Escape Our Doom Loop<\/strong><\/p>\n\n\n\n

The final chapters of Volume II lay out Moynihan\u2019s practical programme for recovery. It is both radical in its implications and refreshingly simple in its execution:<\/p>\n\n\n\n