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Speaker 1: Bloomberg Audio Studios, Podcasts, radio News.

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Speaker 2: Well, quite a lot of speculation is getting pretty wide

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Speaker 2: of the mark. But yeah, let's getting to the area

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Speaker 2: which is wide of the mark.

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Speaker 3: Welcome back to voter Nomics, where politics and markets collide.

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Speaker 3: This year, voters around the world have the ability to

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Speaker 3: move markets, countries and economies like never before, so we

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Speaker 3: created this series to help you make sense of it all.

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Speaker 3: I'm Stephanie Flanders.

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Speaker 4: I'm Adrian Woodridge, and I'm alegra Stratton.

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Speaker 3: Well, we started today's show with a bit from my

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Speaker 3: interview with the UK Prime Ministers Keirs Starmer. We got

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Speaker 3: a bit of news out of him, which we will

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Speaker 3: discuss in a minute, But we were speaking at the

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Speaker 3: International Investment Summit in London exclusively and you heard he

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Speaker 3: pushed back against the capital gains tax speculation. But we

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Speaker 3: also talked about the government's plans for regulation, the relationship

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Speaker 3: with China, and his attitudes towards listing companies like Shean,

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Speaker 3: which has been quite controversial. So we're going to play

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Speaker 3: some highlights from that talk through perhaps the sort of

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Speaker 3: the highs and lows of doing these interviews, the expectations

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Speaker 3: not always fulfilled, and I think as part of this conversation,

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Speaker 3: we wanted to bring in Alvarey, who's a reporter and

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Speaker 3: the Readout newsletter contributor, to get her read on the

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Speaker 3: whole summit really how the government's performed there and in

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Speaker 3: the previous one hundred days. So Alva, I hesitate to ask,

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Speaker 3: but what would you have tried to get out of

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Speaker 3: the Prime minister if you had been talking to him yesterday?

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Speaker 3: And do you think you would have been any more

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Speaker 3: successful than I will?

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Speaker 5: Oh?

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Speaker 3: I think you.

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Speaker 5: I think you made a valiant effort and as you say,

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Speaker 5: you did get a news line out of him. It's

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Speaker 5: a good waite, which doesn't always happen when people interview

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Speaker 5: kre stars.

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Speaker 3: I'm always reminded there is this great moment of kind

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Speaker 3: of optimism about any of these kind of interviews, and

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Speaker 3: Elegre will appreciate this, where you've done the brilliant questions,

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Speaker 3: but you've not heard the sort of wordy answers. Yet

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Speaker 3: you think you're going to get this fantastic interview where

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Speaker 3: he answers all these amazing things. And of course, being

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Speaker 3: a politician, particularly prime ministers, you never quite get what

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Speaker 3: you were hoping to get. But we did hear quite

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Speaker 3: a lot from him.

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Speaker 1: He did commit new. We have this phrase commit news.

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Speaker 1: He did commit news because I think what he said

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Speaker 1: about CGT was interesting. You know, with what sixteen days

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Speaker 1: before a budget or two weeks before a budget and

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Speaker 1: to sort of give any kind of concrete shape, I

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Speaker 1: mean for me, he seemed to be saying, you know

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Speaker 1: what was wider the mark was the number, but that

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Speaker 1: it did feel like CGT will go up.

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Speaker 3: Yeah, And it came on a day where actually the

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Speaker 3: Chancellor Rachel we've heard quite a lot about her loosening

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Speaker 3: the fiscal rules, or at least changing the fiscal rules

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Speaker 3: to allow more investment. What we heard from her was

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Speaker 3: that she seemed to not think raising the National insurance

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Speaker 3: employer's contribution in some way would be a breach of

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Speaker 3: the Manifesto pledge. I did ask the Prime Minister about that.

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Speaker 3: I wasn't able to get him on that, but I

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Speaker 3: think it's interesting because obviously economists would not see much

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Speaker 3: difference between those two and I think a lot of

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Speaker 3: people reading the manifesto would not see much difference. But

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Speaker 3: they seem to be making space for that kind of

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Speaker 3: tax increase.

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Speaker 1: Yes, to me, strategically really odd because you've got this

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Speaker 1: day which is many huge, big bosses coming to the

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Speaker 1: Guildhall and then supports cathedral last night to be serenaded

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Speaker 1: by Elton John to talk about investing into the UK,

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Speaker 1: and then Rachel reads the Chancellor goes out and as

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Speaker 1: you said, say stuff. You know, she crosses the road

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Speaker 1: to have the proverbial fight to say no, we think

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Speaker 1: it's not going to be in breach of the manifesto.

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Speaker 1: That's not the narrative that they should have wanted out

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Speaker 1: of yesterday. They should have wanted out of yesterday exactly

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Speaker 1: what Kistarma was saying to you, which is a decent line.

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Speaker 1: It shouldn't have been thought of as a top line.

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Speaker 1: But you know, no, Stephanie, everyone I talked to is

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Speaker 1: asking me about planning reform, not about tax I think

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Speaker 1: you know that was never going to be the sort

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Speaker 1: of you know, front page splash. But nonetheless, you know

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Speaker 1: it's a fair point and it probably does reflect some

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Speaker 1: of the conversations in the room. But instead you then

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Speaker 1: had language from the Chancellor that is more significant.

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Speaker 3: We probably ought to actually allow people to hear a

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Speaker 3: few minutes of our conversation and This is the first

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Speaker 3: half of the interview. I began just talking about the

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Speaker 3: rather challenging environment in which he was having the summit.

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Speaker 2: There's been a drum beat of inward investment over recent weeks,

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Speaker 2: which I think demonstrates that although yes, of course we've

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Speaker 2: had to signal that there are tough decisions to make

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Speaker 2: because of the damage that's been done to our economy,

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Speaker 2: we've just got to be straight with people about that.

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Speaker 2: We do have amazing assets in this country in terms

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Speaker 2: of our skills, our people, our universities, our cutting edge

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Speaker 2: when it comes to technologies like AI, for example, and

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Speaker 2: that's why making that really clear statement of inten today

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Speaker 2: was very important. And I think quite a lot of

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Speaker 2: the inward investment decisions we've seen, running into tens of billions,

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Speaker 2: are of indication, if you like, of the approach that

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Speaker 2: we're taking in partnership with the investors and the businesses,

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Speaker 2: many many of whom are here today.

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Speaker 3: I mean, one of the things that you've been clear

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Speaker 3: about was that tax and the chances has been clear

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Speaker 3: about is that difficult decisions will be needed. Tax increases

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Speaker 3: will be needed to pay for that investment in public

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Speaker 3: services that people are expecting and given all the taxes

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Speaker 3: that you've ruled out, there's a lot of concern here

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Speaker 3: in the business community about increases in capital gains tax

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Speaker 3: and in wealth tax. Now, I know you're not going

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Speaker 3: to want to go into the details of the budget,

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Speaker 3: but are you reassuring the investors here that they have

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Speaker 3: nothing to worry about on that score.

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Speaker 2: Well, I'm not going to get into the details of

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Speaker 2: the budget. You wouldn't expect me to, but neither are

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Speaker 2: I'm going to shy away from the fact that we've

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Speaker 2: got difficult decisions to make. The last government left a

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Speaker 2: twenty two billion pound black hole and we're not going

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Speaker 2: to walk past that. We're going to have to deal

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Speaker 2: with it. So that'll be tough. But what have been

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Speaker 2: able to be very clear with investors and businesses is

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Speaker 2: because growth is the number one mission, then decisions, whether

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Speaker 2: it's on the budget or anything else, will be determined

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Speaker 2: by whether they help growth or not. So that's the

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Speaker 2: lens through which we're seeing this. But I have to

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Speaker 2: say the discussion here, we've had intense discussions all day

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Speaker 2: long last night as well with a number of people

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Speaker 2: in the room that we've got to know over the

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Speaker 2: last two years, so this is the first time we

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Speaker 2: meet it. All of the discussion today has not actually

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Speaker 2: been about tax. It's been about planning. It's been about

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Speaker 2: the regulatory environment. It's been about getting infrastructure moving much

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Speaker 2: more quickly and the sort of apparatus of government working

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Speaker 2: to that common end. That's the real discussion that's going

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Speaker 2: on here. That's the real focus. And actually, contrary to

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Speaker 2: perhaps what people might think, tax is not the first

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Speaker 2: thing that businesses and investors are raising with me. First

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Speaker 2: thing they're raising with me is is it really your

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Speaker 2: number one mission? Is it going to be stable and

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Speaker 2: strategic and for the long term, to which the answer

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Speaker 2: is yes, And are you prepared to do the tough

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Speaker 2: things on execution and the deliverables, which is about, you know,

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Speaker 2: the length of time it takes from investment decision to

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Speaker 2: actually seeing a project materialize. That's where I think we've

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Speaker 2: been able to do a lot of reassurance that yes,

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Speaker 2: we understand that and we're determined to do the follow

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Speaker 2: through on growth that is desperately needed for investors, for

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Speaker 2: our country and for the jobs of the future.

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Speaker 3: Forgive me, Prime Minister, but I think a lot of

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Speaker 3: people they may not be talking about it to you.

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Speaker 3: But a lot of people are worried. In this sort

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Speaker 3: of vacuum that we've had quite a long wait for

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Speaker 3: the budget. There's quite a lot of what might be

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Speaker 3: might be just crazy speculation around where capital gains tax

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Speaker 3: might go, for example, so something like a thirty nine

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Speaker 3: percent rate. Can you reassure people that whatever the change is,

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Speaker 3: it won't be anything that signifant.

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Speaker 2: Well, quite a lot of speculation is getting pretty wide

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Speaker 2: of the mark. But is the market there is. Yeah,

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Speaker 2: it's get into the area which is wide of the mark.

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Speaker 2: But I'm not going to fuel the speculation because we

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Speaker 2: can go on like this for a very long time

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Speaker 2: until budget day. Everybody knows until budget day none of

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Speaker 2: that is going to be revealed. It was important that

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Speaker 2: when we came into office, into government, we looked at

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Speaker 2: the books, we assess the state of the economy. We

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Speaker 2: needed to understand the damage that's been done and that

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Speaker 2: twenty two billion pound black hole is a real problem

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Speaker 2: that we've got to deal with and make sure that

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Speaker 2: we go through all the processes necessary for a properly

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Speaker 2: thought through budget. So that's why we put the timing

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Speaker 2: as it is. It's the right timing. But equally, it's

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Speaker 2: been really fantastic to have this investment summit just a

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Speaker 2: few weeks before the budget, where the mood music here

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Speaker 2: is very upbeat. People are talking about a real opportunity

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Speaker 2: now to invest in the UK, comparing it as a

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Speaker 2: relative advantage across the world. We want to seize that

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Speaker 2: opportunity and take it boward with many of the investors

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Speaker 2: that are here.

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Speaker 3: You're looking at books, but obviously people are also just

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Speaker 3: sort of checking when they think about I know you're

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Speaker 3: not going to reveal what's on the budget, but when

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Speaker 3: they're thinking about what you've committed to and what you've

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Speaker 3: not committed to. For example, the pledge not to increase

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Speaker 3: natural insurance contributions. Most people I talk to think that

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Speaker 3: if you increase the employer side of that, the employer contribution,

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Speaker 3: that would be breaking that pledge. Can we without getting

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Speaker 3: into the budget, can I just check that is your

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Speaker 3: understanding that that would be breaking that pledge.

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Speaker 2: Well, you're saying, without getting against.

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Speaker 3: The publict it's your pledge.

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Speaker 2: We made commitments in our manifesto and we intend to

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Speaker 2: deliver on those commitments. Beyond that, I'm afraid you'll have

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Speaker 2: to wait for the budget for the details. For very

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Speaker 2: obvious reasons, we're still weeks away from the final assessment

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Speaker 2: in the budget.

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Speaker 3: I guess that what feel you said, it's the right

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Speaker 3: timing for this summit. It does feel a bit odd

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Speaker 3: that for those people in the room, people who are

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Speaker 3: doing deals today, you can't promise them that the basic

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Speaker 3: tax environment for entrepreneurs, for business, for wealth in a

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Speaker 3: couple of weeks time won't be completely different.

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Speaker 2: Well, they're very interested that corporation tax is capped. They

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Speaker 2: know exactly where that is in the long term. They're

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Speaker 2: very interested in the fact that we're able to say

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Speaker 2: that because we've got a good, strong majority in government,

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Speaker 2: we're able to make decisions based on years, not months,

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Speaker 2: with a clear strategy. They're very very interesting when I

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Speaker 2: talk them about being a mission driven government, a government

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Speaker 2: with a real sense of purpose measured over years, with

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Speaker 2: one central purpose, which is wealth creation translated into jobs

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Speaker 2: in different parts of the United Kingdom. That's the sort

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Speaker 2: of stability that they're looking for, and that's the conversations

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Speaker 2: we're having. They're very pleased to hear that from a government.

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Speaker 2: I'm very pleased about the clarity. There's no end of

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Speaker 2: people here today have said the clarity of the message

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Speaker 2: is really welcome. It's now the follow through, which is

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Speaker 2: actually the execution of it. What are you prepared to

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Speaker 2: do when it came to planning, what you're prepared to

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Speaker 2: do when it comes to regulation. It's not just the

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Speaker 2: number of regulations, it's the inconsistency of regulation that we

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Speaker 2: need to deal with. And when I'm able to say

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Speaker 2: with real confidence and certainty and clarity, yes, we're going

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Speaker 2: to deal with that, that leads the decisions, in my view,

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Speaker 2: to make the sort of investment that we've seen in

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Speaker 2: recent weeks, which is very welcome. These are not just

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Speaker 2: big numbers, although they are big numbers, they translate into

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Speaker 2: jobs around the United Kingdom, good, well paid, secure jobs.

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Speaker 2: And that's the change we promised at the election and

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Speaker 2: the change that I'm determined to deliver on.

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Speaker 3: Just looking at the summit, do you think they did

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Speaker 3: what they wanted to do and what do you make

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Speaker 3: of this tax speculation?

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Speaker 5: I think that they are pretty happy with how it

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Speaker 5: went yesterday, All things considered. They feel like they hit

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Speaker 5: the lines that they wanted to. I mean the line

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Speaker 5: that you've got our d of care Starmer. Clearly they

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Speaker 5: wanted to send that thing, or they show that they

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Speaker 5: do make exceptions when they think budget speculation is too

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Speaker 5: of the mark, And clearly they wanted to shoot that

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Speaker 5: dining ratio.

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Speaker 1: So was licensed to go and say that.

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Speaker 5: I think so. I think probably yeah, And in the notes,

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Speaker 5: if pushed, you can say this, you definitely don't want

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Speaker 5: to give the opposite impression. I would imagine that's how

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Speaker 5: it went, even though probably ideally he would have stuck

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Speaker 5: to the line that you mentioned Allegra and then on

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Speaker 5: the employer nix. I think, and we've had a little

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Speaker 5: bit more from Keir Starmer as well, and not saying

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Speaker 5: the same as Rachel reeves, This seems like something that

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Speaker 5: they do clearly intend to do, unless it's all kind

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Speaker 5: of mind games. But I think I think that they

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Speaker 5: feel like they have just enough space or plausible deniability

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Speaker 5: to say that this wasn't a manifesto Pleasure wants fluttering.

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Speaker 4: They've given a very positive assessment of what's going on,

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Speaker 4: but let me be a little bit more negative. First

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Speaker 4: of all, they're very incredibly confused with their messaging. They've

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Speaker 4: spent the last few weeks telling us that Britain is

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Speaker 4: a basket case in all sorts of ways. Its infrastructure

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Speaker 4: is crumbling. It made this dramatically stupid mistake of leaving

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Speaker 4: the EU, and now they're saying to all these people

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Speaker 4: invest here. That's a very odd way of going about government.

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Speaker 4: And secondly, about the Starmer speech, this is sort of

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Speaker 4: we tend to think of this in terms of cat

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Speaker 4: and mouse. We try and get him to say things

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Speaker 4: that tell us what's going to be in the budget,

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Speaker 4: and he tries to stop himself from doing that and

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Speaker 4: keep the surprise there. But I just wonder if that's

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Speaker 4: not the right game to be playing. A better game

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Speaker 4: would be providing a sort of intellectual framework that justifies

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Speaker 4: what you're doing. Of course he can't give away what's

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Speaker 4: in the budget, but what he must do is set

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Speaker 4: up a set of visions of tactics and all of

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Speaker 4: that sort of thing, and he just doesn't do that

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Speaker 4: in this interview.

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Speaker 5: Yeah, well, you were all smiling when I mentioned the

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Speaker 5: employer nix and the government rolling the pitch for that.

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Speaker 5: I wonder what you make of that. It does look

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Speaker 5: like that is what the government intends to do as

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Speaker 5: one of its main revenue raisers. In budget No. I

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Speaker 5: think that they feel like they can just about make

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Speaker 5: the case that this isn't breaking a manifesto commitment, that

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Speaker 5: it's sufficiently ambiguous, because the Tories were pushing them to

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Speaker 5: rule it out during the election campaign, so you could

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Speaker 5: plausibly make an argument that it wasn't in the manifesto itself.

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Speaker 5: I think they feel like they've got enough space there

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Speaker 5: and then this raises enough money in one way.

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Speaker 4: But reinforced the sense on the part of the electorate

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Speaker 4: that even if they were not lying directly, they were

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Speaker 4: really trying to pull the wall over people's eyes and

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Speaker 4: undermine trust in the electorate. We know, really that they

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Speaker 4: made a lot of us about not raising these big taxes,

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Speaker 4: and now they seem to be squirming around in order

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Speaker 4: to be able to do it. They may be able

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Speaker 4: to get away with they've got a vast majority, they

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Speaker 4: may have left themselves wiggle room, but we don't want

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Speaker 4: to be governed by people who are looking for wiggle and.

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Speaker 1: That kind of great independent judge of these things. Paul Johnson,

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Speaker 1: who's the head of the Institute for Fiscal Studies, came

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Speaker 1: out yesterday and said it would be a straightforward breach

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Speaker 1: of the manifesto, and I think Adrian is right. You

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Speaker 1: play with fire when you have an apathetic electurate that

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Speaker 1: thinks they're all the same and don't talk to you straight.

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Speaker 4: But the impression I get from all of this is

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Speaker 4: that we're going to tax labor more heavily, increase the

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Speaker 4: cost of employing people, and we're going to tell employers

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Speaker 4: how to employ people. I mean, we're going to make

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Speaker 4: lots and lots of rules about workers' rights, which you

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Speaker 4: contributes to the extent of regulation and which diminishes your

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Speaker 4: power as a manager to manage. I think both of

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Speaker 4: those are very dubious moves for a government that believes

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Speaker 4: in wealth, supposedly believes in wealth creation.

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Speaker 3: But this is one of those times where I think

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Speaker 3: the politics versus the economics, if you just look at

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Speaker 3: the economics, you know the reason they are in this

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Speaker 3: hole talking about wealth taxation, talking about capital gains tax,

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Speaker 3: which they don't really want to be talking about when

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Speaker 3: they're trying to attract investment and support growth, is because

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Speaker 3: they've ruled out reversing these most recent nationals surance cuts,

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Speaker 3: which the country really couldn't afford. They cost twenty billion pounds,

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Speaker 3: and I think there's a world in which they could

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Speaker 3: have said, you know, we're not raising ASTRA insurance beyond

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Speaker 3: what they were a year ago, but we don't think

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Speaker 3: these recent cuts, which by the way, you've barely noticed,

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Speaker 3: are affordable, and we are going to reverse those now.

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Speaker 3: Who knows whether they could have done that, but if

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Speaker 3: they effectively do that via the employer contribution, it doesn't

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Speaker 3: actually make a bit. It doesn't affect employment anymore or less.

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Speaker 3: To do it on the employer side. On the employee side,

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Speaker 3: they'll be doing it in a politically cack handed way.

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Speaker 3: But a lot of economists would say, yeah, that makes

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Speaker 3: sense because we couldn't afford those recent cuts anyway. One

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Speaker 3: thing I wanted to get onto after that part of

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Speaker 3: the interview was this tension between the focus on ethics

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Speaker 3: and the focus on attracting investment. I think comes up

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Speaker 3: big time, particularly in relation to Chinese companies, but also Sheen,

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Speaker 3: the online retailer so controversial that it has not been

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Speaker 3: able to list in the US because of accusations around

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Speaker 3: forced labor of Weiga workers in Shinjang. And I was

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Speaker 3: quite interested. I mean, Alva, do you think this is

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Speaker 3: going to be an issue for them because the previous government.

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Speaker 3: We're trying desperately to get Sheen because a lot of

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Speaker 3: other people don't want to list in the UK anymore.

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Speaker 3: But this is quite controversial.

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Speaker 5: Well yeah, I think that privately the government says that

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Speaker 5: they're open to this. I read that as they are

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Speaker 5: pretty keen really like they do want more listings in

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Speaker 5: London and this would be a record size of listing.

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Speaker 5: They've had meetings with Shean quite a bit privately, even

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Speaker 5: in opposition. This is something that they do want to

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Speaker 5: see happen, but they're careful about the language around it because,

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Speaker 5: as you say, there's a lot of concern on the

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Speaker 5: labor backbenches and just in Parliament in general about the

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Speaker 5: employment practices of Shean, and they've managed to avoid too

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Speaker 5: much scrutiny on it. But I think it will come

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Speaker 5: to a head. There are some people who are clarly

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Speaker 5: keen to raise this in Parliament in the coming week.

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Speaker 5: So I think it was good that you pressed him

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Speaker 5: on that. The way that the government always gets around

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Speaker 5: this when they're asked about it is they say, well,

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Speaker 5: if they're listed in London, they would be subject to

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Speaker 5: UK employment regulation. And so I think it was good

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Speaker 5: that you said, what does that actually mean? Does that

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Speaker 5: mean that they have to stop using workers in Shinjang?

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Speaker 5: What kind of reassurances will you need? And it was

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Speaker 5: the first indication from Kure Starmer that actually they will

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Speaker 5: need to do that. My understanding is that they've given

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Speaker 5: she In reassurance is that they won't block any attempt

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Speaker 5: to list. But if they need, actually she And to

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Speaker 5: change a big part of their employment model, then I

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Speaker 5: think that that's pretty interesting. I mean, she and I

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Speaker 5: think has always rejected the suggestion that they use slave labor.

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Speaker 4: I think Britain's in a very difficult position in the

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Speaker 4: relationship with China because we can't trade as much as

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Speaker 4: we'd like to on the tech side, so we have

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Speaker 4: to redefine what our trading relationship is. And you know,

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Speaker 4: a fast fashion company doesn't pose national security problems, so

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Speaker 4: that's the sort of area where we ought to be

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Speaker 4: doing that. But you know, again there's this tension between

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Speaker 4: on the world one hand, the focus on investment at

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Speaker 4: any cost or and on the other worker's rights at

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Speaker 4: any cost. And you know, saying we're going to we're

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Speaker 4: going to be much more concerned about workers' rights. But

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Speaker 4: on the other hand, we're going to trade with somebody

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Speaker 4: who uses very dubious sources of labor.

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Speaker 3: In But do you think it actually should be disqualifying

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Speaker 3: for the UK Stock Exchange to have if it turned

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Speaker 3: out they had forced that. It was, of course the

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Speaker 3: question you always have one question, you wish you'd ask

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Speaker 3: three more twice.

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Speaker 4: If they use force labor, absolutely they shouldn't be they

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Speaker 4: should not be allowed to listen on the UK Stock Exchange. Again,

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Speaker 4: as I was saying earlier, these are very mixed messages.

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Speaker 3: So maybe we should listen to that bit of the

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Speaker 3: interview and then see whether he's come out with a

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Speaker 3: coherent policy. So you talked about mission led government and

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Speaker 3: ethics led governments obviously in a feature. But there is

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Speaker 3: another company, Sheen, which was considered to be such a

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Speaker 3: rogue operator in the U s that it hasn't been

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Speaker 3: able to list on the US stock market. It was

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Speaker 3: too controversial as working practices. But it seems that your

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Speaker 3: government is continuing their sort of open arms policy for

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Speaker 3: she wanting Sheen to list here. Is that right?

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Speaker 2: Well, I think we've got to get the balance right,

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Speaker 2: and clearly we've got to have standards, high standards. We

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Speaker 2: do have high standards, not least for example in rights

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Speaker 2: at work, and I addressed that in my speech here

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Speaker 2: today to say look better rights and protection for people

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Speaker 2: in their workplace are good for growth. So we're clear

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Speaker 2: where we stand on standards, but we're future looking, we're

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Speaker 2: pragmatic and subject to those standards. Then, yes, we do

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Speaker 2: want investment into the United Kingdom because we desperately need

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Speaker 2: growth in this time. We have had meaningful growth in

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Speaker 2: the economy in the United Kingdom for fourteen long years.

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Speaker 2: We're determined to turn that around.

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Speaker 3: But just to be clear on that, so the government

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Speaker 3: would need to be sure that she's not using forced

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Speaker 3: labor in Hinjang before it could list in the UK.

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Speaker 2: I'm not going to get into individual businesses. What I

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Speaker 2: will say would be very about it. Standards and high

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Speaker 2: standards do matter to us, so of course we'll be

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Speaker 2: looking at any issue that goes to high standards, with

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Speaker 2: a particular feature on the rights of the workforce. We've

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Speaker 2: been really clear that we see that as two sides

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Speaker 2: of the same coin when it comes to growth, good

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Speaker 2: employment rights and protections and a lot of drag on

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Speaker 2: growth they're fundamental for growth, and I think pretty well

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Speaker 2: all good businesses understand that, which is why in many

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Speaker 2: cases they've already put in place some of the rights

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Speaker 2: and protections that we are bringing forward in legislation on China.

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Speaker 3: And you had an interesting conversation with there it shmitt

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Speaker 3: that this morning that touched on China. I'm interested. You know,

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Speaker 3: right now we have the Chinese Army holding drills around

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Speaker 3: democratically governed Taiwan, which they admit are a rehearsal or

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Speaker 3: a practice for a full naval blockade of this place

437
00:21:52,520 --> 00:21:55,760
Speaker 3: that produces most of the high quality advanced chips in

438
00:21:56,359 --> 00:21:58,080
Speaker 3: the world. I'm just wondering. I mean, we have the

439
00:21:58,119 --> 00:22:01,600
Speaker 3: Foreign Secretary on his way to Beijing later in the week.

440
00:22:02,000 --> 00:22:03,840
Speaker 3: Do you worry about the timing? Do you worry about

441
00:22:03,840 --> 00:22:05,680
Speaker 3: the signal that sends on a week that the army

442
00:22:05,720 --> 00:22:09,480
Speaker 3: is literally practicing potentially an invasion or a blockade of Taiwan.

443
00:22:10,000 --> 00:22:13,400
Speaker 2: Well, the approach i'd take is this that national security

444
00:22:13,400 --> 00:22:15,880
Speaker 2: has to come first, so that's the number one priority,

445
00:22:17,200 --> 00:22:20,000
Speaker 2: and therefore, of course we challenge where it's necessary to

446
00:22:20,080 --> 00:22:23,919
Speaker 2: do so. But we're also pragmatic and we want our

447
00:22:23,960 --> 00:22:27,040
Speaker 2: country to move forward and to succeed. So challenge where

448
00:22:27,040 --> 00:22:30,200
Speaker 2: it's necessary, but there are areas not.

449
00:22:30,119 --> 00:22:34,840
Speaker 3: Necessary when they're really well, we have kind of practice challenged.

450
00:22:34,960 --> 00:22:37,560
Speaker 2: We do challenge, I myself spoke to the President. We

451
00:22:37,600 --> 00:22:42,800
Speaker 2: do challenge where it's necessary to do so. But you know,

452
00:22:42,840 --> 00:22:45,560
Speaker 2: we are pragmatic as well, and we need to make

453
00:22:45,600 --> 00:22:48,960
Speaker 2: sure that we get that balance right when it comes

454
00:22:49,000 --> 00:22:50,760
Speaker 2: to our relation with China.

455
00:22:51,320 --> 00:22:53,480
Speaker 3: I mean, just to follow up on that, when you

456
00:22:53,480 --> 00:22:55,600
Speaker 3: say pragmatic, it feels like you're going to be more

457
00:22:55,600 --> 00:22:59,080
Speaker 3: pragmatic than the previous government. They ceased inter that sort

458
00:22:59,119 --> 00:23:04,159
Speaker 3: of major nomic cooperation, the dialogues, other things. When China

459
00:23:04,240 --> 00:23:06,840
Speaker 3: imposed the National Security Law on Hong Kong. Are we

460
00:23:07,000 --> 00:23:08,760
Speaker 3: sort of officially saying we're over that now.

461
00:23:08,760 --> 00:23:08,920
Speaker 5: Well.

462
00:23:08,920 --> 00:23:10,720
Speaker 2: I think the problem with the last government is they

463
00:23:10,880 --> 00:23:13,280
Speaker 2: veered from one side of the road to the other

464
00:23:13,320 --> 00:23:14,960
Speaker 2: side of the road and then back again, and that

465
00:23:15,119 --> 00:23:17,919
Speaker 2: just led to a pretty chaotic approach. I think everybody

466
00:23:17,960 --> 00:23:21,840
Speaker 2: understands the national security first approach that we must take

467
00:23:21,920 --> 00:23:25,520
Speaker 2: and will take. Everybody understands that we do challenge where

468
00:23:25,560 --> 00:23:30,040
Speaker 2: it's necessary to do so, but equally when it comes

469
00:23:30,119 --> 00:23:32,719
Speaker 2: to I don't know, for example, climate change. We're going

470
00:23:32,760 --> 00:23:36,120
Speaker 2: to have to work with countries like China because it's

471
00:23:36,160 --> 00:23:38,240
Speaker 2: the only way that we can all go forward.

472
00:23:46,040 --> 00:23:48,720
Speaker 3: I mean, of course, some of this is problems with

473
00:23:48,760 --> 00:23:51,560
Speaker 3: their own making, and then there are challenges, as you hint, Madrian,

474
00:23:51,720 --> 00:23:54,679
Speaker 3: that are about the world and Britain in the world.

475
00:23:55,000 --> 00:23:57,320
Speaker 3: You know, Britain having been We've talked about this for Germany,

476
00:23:57,320 --> 00:23:59,880
Speaker 3: but Britain also has a lot vested in a model

477
00:23:59,880 --> 00:24:03,640
Speaker 3: of globalization which no longer exists. Is not it financially

478
00:24:03,680 --> 00:24:06,399
Speaker 3: in a position to do what the US has done,

479
00:24:07,000 --> 00:24:09,520
Speaker 3: And that comes up very much what I was trying

480
00:24:09,560 --> 00:24:11,800
Speaker 3: to get to in the interview with regard to China

481
00:24:11,880 --> 00:24:14,560
Speaker 3: more generally, you know, And in fact he had done

482
00:24:15,880 --> 00:24:18,280
Speaker 3: the Prime Minister had done an on stage session with

483
00:24:18,440 --> 00:24:21,879
Speaker 3: the former head of Google, Eric Schmidt, where Eric Schmitt

484
00:24:21,920 --> 00:24:24,959
Speaker 3: was actually at some point actually seemed to be almost

485
00:24:25,040 --> 00:24:28,320
Speaker 3: sort of not lecturing, but sort of explaining to the

486
00:24:28,359 --> 00:24:30,720
Speaker 3: Prime Minister how the world was these days, that he

487
00:24:30,800 --> 00:24:33,280
Speaker 3: was actually going to have to choose, and Britain wouldn't

488
00:24:33,280 --> 00:24:34,880
Speaker 3: be able to choose China, it would have to choose

489
00:24:34,880 --> 00:24:37,320
Speaker 3: the US, and it couldn't be confused about that. And

490
00:24:37,359 --> 00:24:40,080
Speaker 3: I thought That was quite telling, because this is a

491
00:24:40,080 --> 00:24:46,000
Speaker 3: government that is struggling with being open to China, wanting

492
00:24:46,040 --> 00:24:48,439
Speaker 3: to have that relationship in a world where that's becoming

493
00:24:48,480 --> 00:24:51,760
Speaker 3: harder and harder. So he talked there about they always

494
00:24:51,800 --> 00:24:55,080
Speaker 3: fall back on pragmatism when they haven't got anywhere else

495
00:24:55,119 --> 00:24:59,080
Speaker 3: to go. But Adrian, do you think it's practical to

496
00:24:59,200 --> 00:25:03,520
Speaker 3: have for them to reopen some of these channels for

497
00:25:04,440 --> 00:25:07,560
Speaker 3: economic dialogue and all these things that even the conservatives

498
00:25:07,560 --> 00:25:11,800
Speaker 3: thought they couldn't sustain after the Hong Kong National Security Law.

499
00:25:12,240 --> 00:25:15,119
Speaker 4: First of all, it's very difficult to do that, but secondly,

500
00:25:15,920 --> 00:25:21,240
Speaker 4: the United States is really confronting written with the choice

501
00:25:21,280 --> 00:25:23,520
Speaker 4: you either side with us or who side with China?

502
00:25:24,200 --> 00:25:26,320
Speaker 4: And now we're no longer part of the EU, that's

503
00:25:26,359 --> 00:25:29,280
Speaker 4: an even more pressing, pressing choice and we will have

504
00:25:29,359 --> 00:25:32,840
Speaker 4: to side with the EU. And just saying well, let's

505
00:25:32,840 --> 00:25:35,040
Speaker 4: go for fast fashion is not a way forward. So

506
00:25:35,280 --> 00:25:37,000
Speaker 4: David Lamon is going to have a very difficult time

507
00:25:37,040 --> 00:25:39,320
Speaker 4: in China making sense of me in.

508
00:25:39,320 --> 00:25:42,680
Speaker 3: The week where they're practicing having a blockade of Taiwan.

509
00:25:43,400 --> 00:25:47,359
Speaker 3: Absolutely absolutely, I mean, Alva, what's the on the labour side,

510
00:25:47,400 --> 00:25:49,560
Speaker 3: how much nervousness is around China or they've just got

511
00:25:49,560 --> 00:25:51,240
Speaker 3: too long a list of other things to worry about.

512
00:25:51,400 --> 00:25:55,320
Speaker 5: I don't hear it come up very much. I think

513
00:25:55,359 --> 00:25:58,280
Speaker 5: probably it will more. I think it doesn't in the

514
00:25:58,320 --> 00:26:02,800
Speaker 5: context of what you do. Aren't sanctions on Chinese goods?

515
00:26:04,080 --> 00:26:08,560
Speaker 5: Definitely there are labor MPs even when they were candidates.

516
00:26:08,560 --> 00:26:12,840
Speaker 5: People thinking about Britain's industrial strategy and how you manage that,

517
00:26:12,880 --> 00:26:16,040
Speaker 5: whether you put tariffs on Chinese evs and things like that.

518
00:26:16,200 --> 00:26:17,959
Speaker 1: How much do you think that this is a government

519
00:26:17,960 --> 00:26:20,760
Speaker 1: that is slightly split and conflicted on some of these

520
00:26:20,760 --> 00:26:23,639
Speaker 1: big questions, and just because huge majority in such an

521
00:26:23,640 --> 00:26:25,160
Speaker 1: early stage, we're not seeing it yet.

522
00:26:25,240 --> 00:26:28,680
Speaker 5: I think that it's interesting. Also, as Adrian was talking

523
00:26:28,720 --> 00:26:31,119
Speaker 5: about with the Workers' Rights Package and then trying to

524
00:26:31,119 --> 00:26:34,600
Speaker 5: attract investment, I guess labor has been in opposition for

525
00:26:34,640 --> 00:26:37,440
Speaker 5: so long and had in some ways. You know, they're

526
00:26:37,440 --> 00:26:39,920
Speaker 5: accused of not being well prepared in some ways, they've

527
00:26:39,920 --> 00:26:41,679
Speaker 5: had too long to think about what they would do

528
00:26:41,720 --> 00:26:45,119
Speaker 5: in government. And some promises are very very old, and

529
00:26:45,200 --> 00:26:48,520
Speaker 5: some things are newer and a response to challenges today,

530
00:26:48,920 --> 00:26:51,200
Speaker 5: and something like the workers Rights Package is very old

531
00:26:51,520 --> 00:26:54,760
Speaker 5: that these aren't very old commitments that they have made.

532
00:26:54,840 --> 00:26:56,280
Speaker 5: This is the sort of thing that they feel like

533
00:26:56,400 --> 00:26:59,199
Speaker 5: a labor government should do, Like there's no point in

534
00:26:59,280 --> 00:27:01,600
Speaker 5: being in power if you can't do something like that.

535
00:27:01,880 --> 00:27:04,840
Speaker 5: And then so then they find themselves in this situation

536
00:27:04,880 --> 00:27:07,000
Speaker 5: where they've got their old promises and their new promises

537
00:27:07,000 --> 00:27:09,280
Speaker 5: and they're facing a different directions. Different people in the

538
00:27:09,320 --> 00:27:15,200
Speaker 5: cabinet prioritize different values, and then it doesn't come coherent

539
00:27:15,240 --> 00:27:18,840
Speaker 5: too one overarching domestic narrative. That's been the big criticism

540
00:27:19,200 --> 00:27:22,119
Speaker 5: even from people within government of their the past one

541
00:27:22,200 --> 00:27:24,560
Speaker 5: hundred days, that they don't have leadership from the front.

542
00:27:24,600 --> 00:27:26,960
Speaker 5: Keir Stammer saying, this is the overall thing.

543
00:27:27,200 --> 00:27:28,520
Speaker 3: I think we're going to come back to this quite

544
00:27:28,520 --> 00:27:32,159
Speaker 3: a lot. And there's this I think, Alva, what you

545
00:27:32,200 --> 00:27:34,359
Speaker 3: were bringing us back to is that sort of hole

546
00:27:34,400 --> 00:27:36,679
Speaker 3: at the center, you know, when people go back to

547
00:27:36,760 --> 00:27:39,720
Speaker 3: it's an unfair comparison because there haven't been many more

548
00:27:39,720 --> 00:27:44,080
Speaker 3: effective Number ten operations than the ninety seven Tony Blair operation.

549
00:27:44,280 --> 00:27:46,600
Speaker 3: Just the depth of talent there, the seniority of the

550
00:27:46,600 --> 00:27:49,679
Speaker 3: people there, the David millerbands that ever butt, Jonathan Powell's

551
00:27:49,680 --> 00:27:53,800
Speaker 3: all those people that is clearly lacking in this government.

552
00:27:54,119 --> 00:27:57,520
Speaker 4: And well people weren't senior, were they They were quite

553
00:27:57,720 --> 00:27:58,160
Speaker 4: most of them.

554
00:27:58,160 --> 00:28:00,399
Speaker 3: Well this is where they not, but they were. But

555
00:28:00,440 --> 00:28:03,280
Speaker 3: they were people who had been with the Prime Minister

556
00:28:03,400 --> 00:28:05,479
Speaker 3: for a very Tony Blair for a long time. They

557
00:28:05,520 --> 00:28:07,600
Speaker 3: had all been together for four or five years. And

558
00:28:07,640 --> 00:28:09,280
Speaker 3: I think that's one of the key things. There's not

559
00:28:09,359 --> 00:28:11,520
Speaker 3: of that kind of text is so important though you

560
00:28:11,960 --> 00:28:13,240
Speaker 3: and the social media.

561
00:28:13,440 --> 00:28:16,600
Speaker 1: Social media has fast forwarded the demand for people to

562
00:28:16,680 --> 00:28:20,320
Speaker 1: react to negative news. The scrutiny is so intense and

563
00:28:20,359 --> 00:28:22,080
Speaker 1: so you know, you can have three news stories within

564
00:28:22,119 --> 00:28:25,040
Speaker 1: a day. And it's also we've now got this kind

565
00:28:25,080 --> 00:28:29,280
Speaker 1: of sense of real voter discontent, which that government was

566
00:28:29,440 --> 00:28:32,920
Speaker 1: you know, you know, either at the start of orhad.

567
00:28:32,600 --> 00:28:36,679
Speaker 4: Everything that everything is also of raw talent, and I

568
00:28:36,760 --> 00:28:38,680
Speaker 4: just don't think there's the raw talent here that there

569
00:28:38,800 --> 00:28:40,360
Speaker 4: was in in in ninety seven.

570
00:28:41,760 --> 00:28:43,600
Speaker 3: But I think this goes back to the unfair comparsion.

571
00:28:43,680 --> 00:28:48,160
Speaker 3: There isn't that raal talent on the other side either them.

572
00:28:48,440 --> 00:28:50,040
Speaker 3: This is the best government that we couldn't have.

573
00:28:51,680 --> 00:28:53,680
Speaker 4: I think that's true. That's true, all right.

574
00:28:53,720 --> 00:28:58,160
Speaker 3: On that happy note, Albert Adrian let Thank you very much,

575
00:28:58,560 --> 00:29:04,480
Speaker 3: and I'm sure we will return these topics. Thanks for

576
00:29:04,560 --> 00:29:07,440
Speaker 3: listening to this week's photon Nomics from Bloomberg. This episode

577
00:29:07,480 --> 00:29:10,720
Speaker 3: was hosted by Me Stephanie Flanders with Allegra Stratton and

578
00:29:10,760 --> 00:29:14,080
Speaker 3: Adrian Waldridge. It was produced by Summer Sadie, with production

579
00:29:14,200 --> 00:29:17,400
Speaker 3: support from Chris Martinlou and Isabella Ward and sound design

580
00:29:17,520 --> 00:29:21,040
Speaker 3: by Moses and dam Brendan Francis Newnham is our executive

581
00:29:21,040 --> 00:29:24,600
Speaker 3: producer and Sage Bowman is Head of Podcasts, with special

582
00:29:24,600 --> 00:29:30,520
Speaker 3: thanks to Secure Starmer and Harris Broad and Alviray. Please subscribe, rate,

583
00:29:30,720 --> 00:29:34,480
Speaker 3: and review this podcast highly wherever you get your fix

584
00:29:34,680 --> 00:29:35,560
Speaker 3: of podcasts