Last spring Rachel Reeves introduced securonomics - a UK version of US economic policy that backed big-scale state spending‚ Its now looking like a risky bet
The idea seemed solid: copy Joe Bidenʼs approach with green-focused spending and state involvement. Reeves even went to Washington to show her support for this path (while criticizing UK conservatives for not following it)
- State-led investment programs
- Green energy focus
- Industrial strategy push
- Government spending increase
However recent US elections changed everything - Americans picked Donald Trump instead of Bidenomics; voters main worry was the economy. Even though growth numbers looked good many people felt left out and dealt with high prices instead
Now Labour stands alone with its spending plans: their recent budget shows tens-of-billions in extra costs for next two years. The Office for Budget Responsibility isnt impressed - they think growth will slow down in coming years
The GB Energy project also hit some bumps; its promise to cut 300 pounds from energy bills doesnt look so sure anymore. Market experts think small-scale green projects wont make big changes to costs
Reeves might be seeing these warning signs: her latest speech at Mansion House talked about working with Trump and fixing over-regulation of business. Maybe Labour isnt planning to go solo after all