Growth, growth, growth” is the most persistent economic mantra of the postwar years. It’s been trumpeted so often and by so many that it seems like the only fixed star in a rapidly changing firmament. From the supply-side fantasies of the former Conservative chancellor of the Exchequer Kwasi Kwarteng to the demand-side prudence of the incumbent Chancellor, Rachel Reeves, it has cast its fickle spell across the political imagination.
But calling incessantly for growth is not the same thing as delivering it. Kwarteng’s disastrous tax giveaway crashed the same markets he fervently believed would save us. Reeves’ hike in employer National Insurance is busy undermining the livelihoods of those whose jobs she pledged to support. We’re trapped in a fiscal discipline that makes George Osborne’s austerity look like a generous state handout. And still we repeat the refrain.
Let’s be fair. There is some method in this madness. Growth is supposed to secure us quality of life. It’s supposed to bring us economic power in an uncertain world. It’s supposed to wash away all ills – even those (like climate change) which growth itself has contributed to. It certainly makes the life of government easier when it comes to filling the tax coffers and paying down the public debt.
Yet those glittering prizes have proved consistently elusive since the financial crisis at least. And when Prime Minister Starmer and Reeves start channelling Liz Truss and Kwarteng, you surely have to wonder at the cross-partisan power of the underlying mantra. Particularly when, beyond the ideological crossfire, lies the distant rumble of a more sinister reality.
Labour productivity growth – the very foundation for growth in the GDP – has been on the wane in the UK since the mid 1960s. It’s been hovering around zero for most of the last decade.
No political mantra, no tech-bro fantasy, no alluring macroeconomic ideology has stemmed its persistent decline. Let alone reversed it. To all intents and purposes, we are already living in a post-growth world. And yet we continue to chase the dream.
We dismantle our net-zero ambitions. We renege on our legal commitment to overseas aid. We hand over the provision of basic services to equity financiers who suppress wages, offshore profits, pollute our environment and undermine quality. We continually privatise benefits and socialise risks.
We actively welcome investments from industries that systematically damage us. And in the process we wrack up enormous hidden costs. Costs to the climate, costs to our health, costs to future generations. No political mantra will deliver us from this false economy. Repeating the same prayer in a different political language won’t change the outcome. It won’t deliver us salvation.
It may seem unthinkable, but what we need is a chancellor who is prepared to declare that the emperor is naked. That the god of growth is no longer listening to our prayers.
That ideology won’t protect the health of the population or the future of our children. That we need to place resilience, well-being – and care – at the heart of our economic model. And learn to let go of growth.
This article first appeared in our Spotlight Igniting Growth supplement of 14 March 2025.
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