The Duran Podcast - UK DOOM LOOP. Starmer ignores economy

Episode Date: March 30, 2025

UK DOOM LOOP. Starmer ignores economy

All right, Alexander, let's talk about the state of the UK economy. As Stammer is playing make-believe Churchill in Paris, talking about how the UK is going to defeat Russia and how the UK military is going to enter Ukraine, we have a terrible situation that is happening in the UK with regards to the economy. Stommer doesn't seem to be paying much attention to what is happening. happening in the economy, but things are getting very bad. What is the situation in the UK? I have never known a Prime Minister who has spent so little time on domestic and economic questions, as Kirste Starmer does. Before the last couple of weeks, before the diplomacy

over Ukraine started to crank up, and before Starrma, set up his coalition of the willing and all of that. Even then, apparently, he was devoting around half his time to foreign policy. Now, I suspect, foreign policy is about the only thing he devotes his time to. And I think the reason he's doing that is because he cannot face what look like increasingly insurmountable problems close home, closer to home. Now, last year, basically the British economy flatlined. In January, it contracted, which came as a shock to many people. There was expectations that the economy would grow.

Last year, in the autumn, if you remember, the government presented its budget. It increased spending considerably, mostly by paying public sector workers. It increased taxes. And at the same time, it has committed itself to borrowing more. The government then gave various figures, saying that in a couple of years' time, everything would balance out and we'd be on a sustainable trajectory. Well, that didn't last very long because over the last couple of months, the economy has contracted, as I said, government receipts have been lower than expected.

And the result has been that the fiscal headroom, as it's called, the available money that the government was raising has turned out to be less than they expected. So yesterday they had, well, they've just had to go back, to go back to Parliament, announced further cuts. A couple of days ago, they asked. announced cuts of five billion pounds on spending for disabled people. Now they've announced a further three billion pounds on spending for people. And we're getting indications that they're going to increase taxes in the autumn. Now, the reason this is happening is because

the economy, as I said, isn't growing. It's, if anything, contracting. The government is deeply in debt. It's 100% debt to GDP ratio in the UK is now around 100% of GDP. Britain runs a permanent deficit on its current account. So it's having to import capital from abroad. foreign investors worry that Britain's public finances might become unsustainable. So whenever it looks as if the government might be about to run out of money, it has to either cut spending or increase taxes.

That causes the economy to grow even more slowly. And then that forces the government a couple of months later when it be. becomes clear that the money that it's raising is not going to be enough to go over the same process again, cut spending, increased taxes. We are in Britain in a doom loop. That is what the economy, about the situation in the economy currently looks. Do the people know this? Do the citizens of Britain understand this? Does Stommer understand this? Because, you know, you You said he's interested in foreign policy, not so much interested in what's happening in the domestic affairs of the UK.

I would even say that it's not even foreign policy. He's just concerned with Ukraine. That's it. Yeah. That's the only thing he's concerned about is Ukraine. Nothing else. Do the people understand? Are they seeing this?

Do they see him go to Paris every couple of weeks or having these summits in London about Ukraine? And are the people saying, what is this guy doing? talking about with Ukraine all the time. What is he talking about UK military in Ukraine that they don't have? To go to Ukraine to do what? Why is he talking about money? He's still talking about money to Zelenskyy, money that they don't have. I mean, what's the general vibe? What's the sentiment in the UK about all of this? Well, one of the major problems, before I get to star, I think it's important to point this out. I mean, there are lots of under- problems in the British economy, which have been building up over a very, very long time,

and governments have been repeatedly making them worse, the decisions governments have been making, stretching all the way back, arguably to Blair's time, have ultimately undermined the foundations of the British economy more and more. Some would say going back even further to Thatcher's time and even beyond that, but anyway, let's not focus on the history. But these underlying problems have been made much worse over the last two, three years, because of British government policy, specifically on the issue of Ukraine. Britain gives Ukraine direct grants. They're running at about three billion pounds a year. Sometimes they've been more than that. The British government has been sending weapons to Ukraine on a huge

scale, that has left the British armed forces in a very, very poor condition. One of the reasons they're having to spend more on defence is precisely because they need to re-equip the army, because the army is so short of weapons now. They have created a state of international tensions. They've contributed very much to creating a set state tensions in international tensions. fear of war with Russia. They're talking about having to increase defense spending. To address that, they never explain their own role in creating this crisis in international relations. And of course, the sanctions which they so urgently, so insistently advocated on Russia, have had a massive, you know, effect on the British economy itself.

They've resulted in very, very much higher energy costs. Prices for energy in Britain are amongst the highest in the world. And that's also had a cumulatively bad effect on the British economy. Moreover, there's strong reasons to think that energy prices are going to surge again in the autumn. I've been discussing various programs, how problems of gas supply, the amount of gas in the European reserves is now at critically low levels. Nobody is talking about this, but there is a real possibility that come the autumn. There will be shortages of gas.

Gas will have to be bought at premium prices, liquefired. natural gas, that's quite likely to be passed on in higher prices to UK consumers, which will depress the standard of living even further. So nobody wants to talk about this, but Ukraine is now a major reason why the government, from one budget to another, finds itself shorter and shorter of money and why it's having to cut spending and or increases taxes in order to balance things out so that foreign investors and foreign bondholders will continue to put money into Britain. Now, coming back to what people think, I think Stama probably deep down has some understanding

of this, but he doesn't want to face it. I think he is not prepared to change policy on Ukraine. As has been discussed many times now, he's basically a cutout, the political class, the people who run it, Stama. For them, Ukraine, defeating Russia, getting Europe back into the EU, all of these things are far more important than what happens to the British economy. Getting the UK back into the EU here. Back into the EU, sorry.

All of this is far more important for them than what happens in the short or medium or even long term to the British economy. So he will just continue doing what he wants to do. And at the psychological level, I think he finds it easier, much easier to hold summit meetings with Macron, to talk about Putin and what a bad man he is, do those kind of things, than to confront the major increasing underlying problems of the British economy. As for the British people, they do understand this. The mood in the UK is very bad. People are very demoralised.

I've been saying this now for months. You see this in the polling figures when none of the political parties, conservatives, labor are doing particularly well. So there is a widespread feeling that things in Britain are very bad and that there's no clear way forward. But there is still no real coming together of people, no real decision about what alternatives we should follow. And that also is contributing to the deepening malaise. There is a sense instead that whatever we do, whatever we try, matters are simply going to get, the situation is simply going to get worse.

And that is very demoralizing. And it's causing people to hunker down to try to get through day by day, hoping that some miracle will turn out in a year's time or five years time or whenever, and then things will come back to normal. That's, I think, a summary of the mood here in the UK at the moment. Final question on Farage? Yeah. It seems like Farage is sometimes it seems like he's going against the establishment.

Other times it seems that he's folding into the establishment, complimenting. the establishment, the government stammer. Other times it looks like he's ready to lead reform to a victory. Then he says something which makes many people believe that perhaps he's leading reform to, or he's working against reform. I mean, I don't know. Farage seems like he's a bit lost, at least to me, as to what his position is on all of this. Is he establishment?

Is he anti-establishment? Is he there to help reform? Is he there to dismantle reform? I haven't been quite able to put my finger on what Farage is looking to do. What are your thoughts? He remains by far the most interesting politician in the UK at the moment. I mean, he is the politician who brought about Brexit, who changed politics in Britain. The great problem with Farage is that he's always been strong.

strongest in opposition. And he's never until now really imagined himself, prime minister, and worked out a program for government that he would take to the British people. He's now closer to achieving that goal than he has ever been. But he risks, and you can see this, the pressures are on him, falling into the trap that all insurrectionary leaders of political movements fall into, what many of them do, which is that the closer he comes to power, the more he feels the inclination to compromise with the political class, because he thinks that if he does that, that's going to win over more centrist, more moderate voters who will then come to him and will give him the chance to lead.

And he also thinks that if he does that, it will somehow make him more respectable and will make it easier if when he does form a government, it'll make it easier for him to move forward and to establish a government that will be acceptable to the political class. You see this time and again, you see this with Maloney, for example, in Italy. That was exactly the trap ultimately that she fell into. So I think that is the danger with Farage. Remember, as I said, this is not someone who two or three years ago ever envisaged himself as prime minister. So this is why I think he's not catching fire.

Because even though reform is by some calculations, not all, but by some calculations, the most popular party, Britain today. Others, by the way, put him ahead of the Conservatives, but still behind Labour. He's still only polling around, or between 20, 25%, which is huge for an insurrectionary party in, or would have been huge for an indirectionary party in a previous period in British, modern British history. But given the situation that we have today, It could arguably be said to be disappointed. This is, I think, the reason that he's flatlining, because he's not putting forward a convincing program telling people,

look, this is all going terribly wrong. We've got to carry out much more radical changes to the way that Britain is run, because we are in this doom loop situation. So we have to change and adjust our foreign policy. We have to look at the way we run our domestic policy. We have to do all of these various things and put them all together. And then we can finally break out of this. I think people would be ready to listen to that.

And I think if you put together a convincing program for reform, as he says, then change might happen. But he hasn't done that up to now. Now, a couple of days ago, he did have a meeting with Dominic Cummings, who was Boris Johnson's chief advisor, until, of course, Boris Johnson basically got rid of him. Now, Carming's is someone with lots of plans. I mean, he's got all kinds of ideas for change. Mostly, it must be said, more about governance and about how to change the structures in the centre.

Not all of which I agree with, by the way, but anyway, I mean, he's a man full of ideas. is. Maybe if it is indeed the case that Cummings and Farage will come together, that will start to see something a little bit more coherent coming from reform and for Raj himself and that that will eventually start to work its way through and start to be appreciated by more people in Britain. something we have to see. And it's important to say that Farage and Cummings have a long history of very, very bad relations with each other. They're not friends. All right. We will end the video there. The durand.locals.com. We are on Rumble, Loddicey, Betchut, Telegram, Rockfin, and X. Go to the Duran Shop, pick up some merch like what we are wearing in this video update. There is a 15% special as well on the Duran shop. Use the code Spring 15. The link is in description box.

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