Category: Sam Bidwell

British Overseas Territories

Sam Bidwell writes on Britain’s Overseas Territories.

“the UK hasn’t been self-sufficient in terms of food production since the 1750s – and in the 1930s, only about 30% of food consumed in the UK was produced domestically”

On the 4th October, the UK Government announced that it would hand over the Chagos Islands to Mauritius The handover puts our strategic interests at risk – but why?  An overview of the Overseas Territories, and why they’re so crucial to our security and national interests.

Here is a map of Britain’s Overseas Territories Together, they form a network of staging posts that allows us to defend our interests abroad. But it doesn’t take a genius to notice that most of these territories are not close to the British Isles – so why do they matter?

For centuries now, Britain has been a trading nation, with commercial interests abroad. For example, the UK hasn’t been self-sufficient in terms of food production since the 1750s – and in the 1930s, only about 30% of food consumed in the UK was produced domestically.

Today, we import roughly 40% of our food and 37% of our primary energy sources. This means that we have an interest in the security of key trade routes and shipping lanes. Disruptions to these routes can drive up import costs, meaning higher prices for British consumers.

Even if Britain became more self-sufficient in food and energy production, we would still have overseas interests. Many of our largest businesses rely on their operations abroad to turn a profit. Also, we still need to collect military intelligence, to help us predict threats.

“The Overseas Territories are a crucial part of our efforts to keep trade flowing and exercise influence. For example, Gibraltar sits at the western entrance to the Mediterranean Sea, which accounts for about 15% of all global shipping”

Economic and military influence abroad also gives us a stronger hand when we deal with other countries – which brings us to the Overseas Territories.

The Overseas Territories are a crucial part of our efforts to keep trade flowing and exercise influence. For example, Gibraltar sits at the western entrance to the Mediterranean Sea, which accounts for about 15% of all global shipping. The RAF and Royal Navy both have a presence here, allowing for quick deployment into the Mediterranean or out into the Atlantic.

If the Strait of Gibraltar were disrupted, this would be a disaster for the flow of global trade – and Gibraltar helps Britain to keep it open. The Rock of Gibraltar is also an outpost for intelligence gathering, perfect for transmitting and receiving intel over long distances.

At the other end of the Mediterranean are Britain’s two sovereign base areas on the island of Cyprus, Akrotiri and Dhekelia from the RAF Base at Akrotiri, Britain can maintain influence over the other entrance to the Mediterranean, namely the Suez Canal.  Akrotiri also allows Britain to maintain oversight of the volatile Middle East, both in terms of intelligence gathering and in terms of forward military operations. Akrotiri has been crucial in joint US-UK efforts to keep the Red Sea shipping route open despite Houthi attacks.

Ascension Island in the South Atlantic is home to an RAF facility, which was critical to the success of the Falklands War in 1982 It serves as a refuelling point for Royal Navy ships, a signals intelligence hub, and hosts one of the four ground antennas that enables GPS.

Further south are the famous Falkland Islands, now home to RAF Mount Pleasant.  While traditionally not of enormous strategic value, a number of companies are now drilling for oil and gas off the coast of the Falklands – which we should be taking advantage of.

“The British base on the islands, Diego Garcia, allows the British military to refuel and restock when travelling between Europe, Asia, and the Middle East. It is also ideally located for intelligence gathering”

Of course, the world’s most important shipping lanes are not in the Mediterranean or the South Atlantic – but in Asia. This is precisely why the British presence in the Chagos Islands is so important – it is a staging post for our operations in East Asia and the Persian Gulf.

The British base on the islands, Diego Garcia, allows the British military to refuel and restock when travelling between Europe, Asia, and the Middle East. It is also ideally located for intelligence gathering, with easy access to some of the world’s most important theatres.

Diego Garcia complements British military instalments in the Persian Gulf, including our naval support facility in Bahrain, our military logistics centre in Duqm, Oman, and the RAF outpost at Al Udeid, Qatar.  These instalments help us to ensure the free flow of oil.

Diego Garcia also complements British military instalments in Southeast Asia, such as naval facility in Sembawang, Singapore and our military base in Brunei.  These instalments help us to ensure the free flow of goods from Asia to Europe and vice versa.

“What’s more, Mauritius regards China as a key ally – and is susceptible to Chinese economic influence”

Under the handover deal, Britain retains access to Diego Garcia for another 99 years – but this is a vulnerable position. After all, Mauritius promised that it would honour Britain’s ownership of the Chagos Islands in the 1960s, and reneged within a generation. 

What’s more, Mauritius regards China as a key ally – and is susceptible to Chinese economic influence.  Naturally, China has an interest in expanding its own ability to influence global trade routes from this key strategic position in the Indian Ocean.

The deal also removes Britain’s ability to use access to Diego Garcia as a bargaining chip when dealing with the United States. Allowing partners to use the Overseas Territories strengthened Britain’s negotiating hand – after all, we could always threaten to take it away.

Of course, not all of our Overseas Territories are of military importance. Caribbean territories like the British Virgin Islands, Anguilla, and the Cayman Islands offer favourable tax treatment, and widen access to capital for our financial services sector.

What is certain is that our Overseas Territories are a key part of a self-interested UK foreign policy – giving us military flexibility and influence, leverage over our allies, and the ability to protect key shipping lanes. Handing over the Chagos Islands was a mistake.

Reproduced with kind permission of Sam Bidwell, Director of the Next Generation Centre at the Adam Smith Institute, Associate Fellow at the Henry Jackson Society, although views are his own.  Sam can be found on X/Twitter, on Substack, and can be contacted at [email protected].  This article was originally published as a X/Twitter Thread at https://x.com/sam_bidwell/status/1842213433044861296?s=46.

Singapore: reasons for the Lion City’s remarkable success

Sam Bidwell writes on the success of Singapore.

“Singapore was born – a poor city state, surrounded by enemies, and with no natural resources of its own. Yet today, Singapore is one of the world’s richest and most successful nations”

Today, Singapore is: – the safest city in the world – the world’s freest economy – #1 in the Ease of Doing Business Index But why has Singapore been so successful, and why is it such a great place for businesses? A on the reasons for the Lion City’s remarkable success.

First, some history. In 1819, Singapore was founded by Sir Stamford Raffles, a British official who believed that the site was perfect for a trading post. The city grew quickly, attracting traders from across the region who were drawn to the city’s ‘free port’ status.

Singapore was governed by the British until 1963, when the city became independent as part of the ‘Federation of Malaya’. However, the union was not a harmonious one. Due to political disputes – including race riots in 1964 -, Singapore was expelled from Malaya in 1965.

And so, Singapore was born – a poor city state, surrounded by enemies, and with no natural resources of its own. Yet today, Singapore is one of the world’s richest and most successful nations, thanks largely to the work of its visionary founding father, Lee Kuan Yew.

A graduate of the University of Cambridge, Lee had initially tried to make a success of Singapore’s position within Malaya. But with independence forced upon him, he worked to build the ideal “start-up” nation in Singapore, using the city’s natural strengths to his advantage.

“Over 99 percent of all imports to Singapore are duty free. Corporation tax is charged at a flat rate of 17%, and the city has no capital gains tax.”

He was ruthlessly pragmatic in pursuit of his vision. His decisions were guided by empiricism rather than ideology. As a result, Singapore grew from an obscure post-colonial backwater into a world-leading city. What exactly did Lee do?

First, he recognised that Singapore’s openness to business and trade could be one of its greatest strengths. Over 99 percent of all imports to Singapore are duty free. Corporation tax is charged at a flat rate of 17%, and the city has no capital gains tax.

Thanks to efficient processes, it takes an average of 1.5 days to set up a business in Singapore, and just 15 minutes to register a company online. That’s alongside strong IP protections and light-touch regulation – many businesses have their Asia-Pacific hub in Singapore.

In order to make Singapore attractive to global businesses, Lee Kuan Yew insisted that English would be the main language of administration in the city. Alongside English, Singaporeans also learn a ‘mother tongue’ – Mandarin, Malay, or Tamil – depending on their heritage.

But low taxes and English proficiency alone would not be enough to guarantee Singapore’s success. The city also has world-leading infrastructure, designed with comfort and ease in mind. Singapore’s port is the second busiest in the world in terms of total shipping tonnage.

Meanwhile the city’s airport, Changi, is consistently rated as one of the best in the world. Changi Airport serves more than 100 airlines flying to more than 400 cities worldwide. It is clean, comfortable, and modern, designed to ensure efficient layovers and speedy boarding.

“One of the tragic illusions that many countries of the Third World entertain is the notion that politicians and civil servants can perform entrepreneurial functions.”

Within the city itself, travellers can get around using the fully automated Mass Rapid Transit network – a clean and comprehensive urban transit system, complete with functional Wi-Fi. Meanwhile the city’s roads are rated as amongst the best in the world.

Much of this infrastructure is funded and maintained by Temasek, an investment firm owned by the Singapore Government. Alongside GIC, Singapore’s other sovereign wealth fund, Temasek operates like a private company, managing many of the Government’s assets.

Temasek uses private sector incentives in the public interest. “One of the tragic illusions that many countries of the Third World entertain is the notion that politicians and civil servants can perform entrepreneurial functions.” – Dr Goh Keng Swee, 1st Finance Minister

Singapore also has a zero-tolerance approach to crime, with impartial and efficient enforcement of strict laws. Chewing gum is banned in the country, and littering can result in an on-the-spot fine. Vandalism and drug use can result in harsh penalties, including caning.

These laws, alongside an efficient system of municipal government, makes Singapore the world’s cleanest and safest city. Singaporeans regularly leave their phones as placeholders in public places – a civic culture of cleanliness and orderliness is extolled at every level.

Singapore also invests in its people and maintains genuinely meritocratic systems for hiring and firing. The Government consistently invests in education. At schools, at universities, and in public life, Singaporeans venerate intellectual ability and promote those who succeed.

Its political system is meritocratic too, prizing stability and talent. Though Singapore holds free multiparty elections, the Government maintains control over the political process. Protest is strictly controlled, and the press is regulated to prevent seditious acts and speech.

“Stability, low taxes, an efficient state, and an uncompromising approach to public order. These are the roots of Singapore’s success”

The result is the most stable political system in Asia, and amongst the most stable countries in the world. The People’s Action Party, founded by Lee Kuan Yew, has led Singapore since 1965, ensuring stability and continuity across the decades.

Public figures – civil servants and politicians – are paid well, to ensure that the best and brightest are attracted into Government. The Prime Minister of Singapore earns about ten times more than the UK’s Prime Minister, and about four times as much as the US President.

But Singapore also has a zero-tolerance approach to corruption. Public officials who take bribes while in office are removed from their post, fined, and often jailed. Just this week, the country’s former Transport Minister has been convicted of receiving gifts while in office.

Stability, low taxes, an efficient state, and an uncompromising approach to public order. These are the roots of Singapore’s success. In building Singapore, Lee Kuan Yew was not guided by ideology, but by what works. He was a pragmatic empiricist through and through.

Lee’s story is a reminder that national success is largely the product of pragmatism, competence, and vision. By studying what works in practice and implementing it, we can change society for the better. No obstacle is too big if we set our minds to the task of national revival.

The great man himself puts it best: The lessons of Singapore and Lee Kuan Yew should inspire us all.

Reproduced with kind permission of Sam Bidwell, Director of the Next Generation Centre at the Adam Smith Institute, Associate Fellow at the Henry Jackson Society, although views are his own.  Sam can be found on X/Twitter, on Substack, and can be contacted at [email protected].  This article was originally published as a X/Twitter Thread at https://x.com/sam_bidwell/status/1839676939444875461?s=46.

UK stagnation: countries which have overtaken the UK since 2007.

The UK’s economy has stagnated since 2008. In terms of GDP per capita – economic output divided by the number of people in a country – we’ve actually gone backwards. Sam Bidwell gives an overview of the countries that the UK was richer than in 2007, but which have since overtaken us…

“None of this was inevitable. Our economic stagnation was the result of policy choices made by successive governments”

  • UK GDP per Capita, 2007: $50,397
  • Singapore GDP per Capita, 2007: $39,432
  • UK GDP per Capita, 2023: $48,866
  • Singapore GDP per Capita, 2023: $84,734

In 2007, the UK was richer than Singapore, southeast Asia’s Lion City – today, it is much, much poorer.

  • UK GDP per Capita, 2007: $50,397
  • USA GDP per Capita, 2007: $48,050
  • UK GDP per Capita, 2023: $48,866
  • USA GDP per Capita, 2023: $81,695

In 2007, the UK was (slightly) richer than the United States, the world’s economic superpower. Today, it is far poorer.

  • UK GDP per Capita, 2007: $50,397
  • Australia GDP per Capita, 2007: $41,051
  • UK GDP per Capita, 2023: $48,866
  • Australia GDP per Capita, 2023: $64,711

In 2007, the UK was richer than Australia, a world-leading mining economy. Today, it is much poorer.

  • UK GDP per Capita, 2007: $50,397
  • Austria GDP per Capita, 2007: $46,915
  • UK GDP per Capita, 2023: $48,866
  • Austria GDP per Capita, 2023: $56,506

In 2007, the UK was richer than Austria, a highly developed social market economy. Today, it is poorer.

  • UK GDP per Capita, 2007: $50,397
  • Belgium GDP per Capita, 2007: $44,319
  • UK GDP per Capita, 2023: $48,866
  • Belgium GDP per Capita, 2023: $53,475

“When you see crumbling infrastructure, poor public services, or stagnant job opportunities, you’re seeing these two lost decades of growth”

In 2007, the UK was richer than Belgium, a developed services economy and home of the EU. Today, it is poorer. {Editors note: Taking money from hard working citizens of the EU does help}.

  • UK GDP per Capita, 2007: $50,397
  • Finland GDP per Capita, 2007: $48,467
  • UK GDP per Capita, 2023: $48,866
  • Finland GDP per Capita, 2023: $53,755

In 2007, the UK was richer than Finland, a powerhouse in electronics manufacturing. Today, it is poorer.

  • UK GDP per Capita, 2007: $50,397
  • Canada GDP per Capita, 2007: $44,659
  • UK GDP per Capita, 2023: $48,866
  • Canada GDP per Capita, 2023: $53,371

In 2007, the UK was richer than Canada, our oil-producing cousins across the Atlantic. Today, it is poorer.

  • UK GDP per Capita, 2007: $50,397
  • Germany GDP per Capita, 2007: $41,640
  • UK GDP per Capita, 2023: $48,866
  • Germany GDP per Capita, 2023: $52,745

In 2007, the UK was richer than Germany, Europe’s manufacturing powerhouse. Today, it is poorer.

  • UK GDP per Capita, 2007: $50,397
  • UAE GDP per Capita, 2007: $43,918
  • UK GDP per Capita, 2023: $48,866
  • UAE GDP per Capita, 2023: $52,976

In 2007, the UK was richer than the UAE, the Gulf state which plays host to futuristic cities like Dubai. Today, it is poorer.

  • UK GDP per Capita, 2007: $50,397
  • Hong Kong GDP per Capita, 2007: $30,593
  • UK GDP per Capita, 2023: $48,866
  • Hong Kong GDP per Capita, 2023: $50,696

“it doesn’t have to be this way. We were richer than these world-leading economies before, and we can do it again”

In 2007, the UK was much richer than Hong Kong, East Asia’s financial services superpower. Today, it is poorer.

  • UK GDP per Capita, 2007: $50,397
  • Israel GDP per Capita, 2007: $25,633
  • UK GDP per Capita, 2023: $48,866
  • Israel GDP per Capita, 2023: $52,261

In 2007, the UK was much richer than Israel, the Middle East’s high-tech hub. Today, it is poorer.

None of this was inevitable. Our economic stagnation was the result of policy choices made by successive governments since 2008. Our broken planning system, expensive energy, and a risk-averse regulatory culture have all contributed to nearly two lost decades of growth.

When you see crumbling infrastructure, poor public services, or stagnant job opportunities, you’re seeing these two lost decades of growth. The point is that it doesn’t have to be this way. We were richer than these world-leading economies before, and we can do it again.

Principally, this requires two things from our politicians. Honesty – about why we are where we are, and how we got here. And ambition – about what Britain can, and should, be. We deserve to be a high-tech, high-growth, high-powered economy again.

That means getting the basics right – housing, energy, infrastructure, public order, migration. Let’s start building things again and stop relying on low-skilled labour. Dare to dream. We built the modern world before, and we can do it again. Anglofuturism now.

Reproduced with kind permission of Sam Bidwell, Director of the Next Generation Centre at the Adam Smith Institute, Associate Fellow at the Henry Jackson Society, although views are his own.  Sam can be found on X/Twitter, on Substack, and can be contacted at [email protected].  This article was originally published as a X/Twitter Thread at https://x.com/sam_bidwell/status/1832062722412015803.

Podcast Episode 94 – Sam Bidwell: Selling Economic Liberty

We are joined by Sam Bidwell, the Director of the Next Generation Centre at the Adam Smith Institute, as we discuss the challenges of selling economic liberty and free markets to younger people.

You can find out more on Sam at X/Twitter, and at his Substack. You can find the articles we discussed with Sam here https://croydonconstitutionalists.uk/category/sam-bidwell/.

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Contents:

00:00 – Intro
01:40 – Next Generation Centre at the Adam Smith Institute
06:30 – Young people & free markets
15:00 – Selling economic liberty
19:40 – Policy ideas
24:10 – Thoughts on the new government
28:50 – Plans for the Next Generation Centre
31:16 – Website
33:30 – Events
35:08 – Outro

Dubai’s transformation: shrewd investments and a business-friendly environment

“Dubai’s remarkable growth is the product of shrewd investments, business-friendly tax and regulatory rules”

In just fifty years, Dubai has transformed from an obscure fishing village into a city of global significance.

Despite popular misconceptions, oil revenues contribute less than 1% of Dubai’s GDP today.  You read that right – unlike nearby Abu Dhabi, Dubai’s economy is not powered by oil revenues. In fact, Dubai’s remarkable growth is the product of shrewd investments, business-friendly tax and regulatory rules, and an uncompromising approach to political stability.

Modern Dubai was founded as a fishing village on the Persian Gulf at some point in the 18th century. Throughout the early 19th century, Dubai – as well as other neighbouring Gulf states – fell under British influence. In 1820, these small Gulf states fell under a British protectorate.

“In 1901, Sheikh Makhtoum bin Hasher Al Makhtoum established Dubai as a free port, with no tariffs on imports or exports”

As early as 1900, Dubai began to emerge as an important port. Its location at the mouth of the Persian Gulf made it ideal for trading into the Middle East, India, and East Africa. This geographic advantage, and its openness to commerce, has been the secret to Dubai’s success.

In 1901, Sheikh Makhtoum bin Hasher Al Makhtoum established Dubai as a free port, with no tariffs on imports or exports. Merchants, particularly those working in the pearl industry, were given parcels of land, guarantees of protection, and religious toleration.

In the first half of the 20th century, Dubai grew in importance as a hub for trade with Persia and India. However, the city’s position was supercharged with the emergence of a new leader. In 1957, Rashid bin Saeed Al Makhtoum succeeded his father to become ruler of Dubai.

Sheikh Rashid understood the young city’s potential. He set about transforming Dubai from a small coastal settlement into a modern port city. He also understood the keys to Dubai’s success – openness to trade, infrastructure investments, stability and order.

“In 1966, more gold was shipped from London to Dubai than almost anywhere in the world”

He set about creating private companies to build and operate infrastructure. In 1959, he established Dubai’s first telephone company; by 1961, it had rolled out an operational network. The city’s private water company established a regular supply of piped water by 1968.

By 1960, the city’s airport had opened, with flights operating across the Middle East. In 1963, the Sheikh opened the first bridge across Dubai Creek, paid for by tolls. The airport was expanded in 1965 to enable long-haul flights and was expanded again in 1970.

By the late 1960s, Dubai was also a hub for the global gold trade – much of which was based on the illegal sale of gold to India. In 1966, more gold was shipped from London to Dubai than almost anywhere in the world (only France and Switzerland took more).

And again, this is all before the discovery of oil. By the time that Dubai struck it rich in 1966, it was already a growing port, with a solid base of infrastructure and a low-tax, pro-business environment. Of course, the discovery of oil supercharged Sheikh Rashid’s vision.

“Roads, bridges, hospitals, and schools were constructed in a construction glut which propelled Dubai’s economy through the 1980s. As the old saying goes, build it and they will come”

But Sheikh Rashid had the foresight to know that one day, the oil would run out. He understood that one day, the city would need to survive without oil – and so set about making Dubai a world-leading hub for regional and international commerce.

In 1972, Port Rashid was constructed and in 1979, it was followed by the Port of Jebel Ali, today the busiest in the Middle East. In 1978, Sheikh Rashid opened the Dubai World Trade Centre. Dubai Creek was dredged and widened in the early 1970s. In 1983, Dubai Drydocks opened.

Meanwhile the city’s airport was expanded, and hotels were opened for business travellers. Roads, bridges, hospitals, and schools were constructed in a construction glut which propelled Dubai’s economy through the 1980s. As the old saying goes, build it and they will come.

This infrastructure-first approach was the foundational principle of Dubai’s pro-business policy environment. By leveraging the city’s geography and encouraging businesses to invest, Dubai made itself into one of the Middle East’s leading trade entrepôts.

The city sits at the mouth of the oil-rich Persian Gulf, with convenient maritime connections to Asia, Europe, and Africa. By air, more than 50% of the world’s population is 7 hours or less from Dubai – again, ideal geography for an international business hub.

“26 free trade zones, companies enjoy a 50-year corporation tax exemption, and no international tariffs. Many of these free trade zones use English common law”

However, it’s not just geography and infrastructure. Dubai has no income tax. Corporation tax is low at 9% – and in 26 free trade zones, companies enjoy a 50-year corporation tax exemption, and no international tariffs. Many of these free trade zones use English common law.

These zones create an extremely business-friendly environment – many international businesses have their regional or global HQs in Dubai. At the same time, the state invests in the infrastructure – roads, schools, hospitals – needed to keep business travellers coming.

And speaking of business travellers, Dubai – and the rest of the United Arab Emirates – is home to a large number of foreigners. In fact, 88% of the UAE’s population are expats. The territory’s tax-free status and world-leading infrastructure attracts high net-worth individuals.

However, unlike in Europe, immigrants in Dubai live under strict conditions. They do not benefit from state welfare and can be deported at any time. It is almost impossible to become a naturalised citizen. In return, migrants get to make far more money than they would at home.

This is particularly true for low-skilled migrants, often from South Asia, who come to the country under the so-called ‘kafala system’. Under the kafala system, all migrant workers need to have an Emirati sponsor – if their employment ends, so does their residence.

Which brings me onto the final aspect of Dubai’s success – law and order. The city has a zero-tolerance approach to crime and public disorder. The Dubai Police employs drones and has an average emergency response time of 2 minutes and 24 seconds, as of Q3 2023.

“Despite popular misconceptions, its rapid rise owes just as much to sensible policymaking as to oil. Not everybody can turn a patch of desert into a global megacity!”

Sheikh Rashid passed away in 1990. He was succeeded by his son, Maktoum, who ruled until 2006. In turn, Maktoum was succeeded by his brother Mohammed, who rules Dubai to this day. Though Dubai has grown considerably since Sheikh Rashid’s time, the basic principles are the same.

In many ways, the principles that built modern Dubai are the same as those that built Hong Kong, Singapore – or even, historically, London.

  • Openness to business
  • Ideal strategic positioning
  • Shrewd investments in infrastructure
  • Pragmatic governance
  • Law and order

Whatever you think of Dubai, the city’s growth is one of the most incredible stories of the 20th century.  Despite popular misconceptions, its rapid rise owes just as much to sensible policymaking as to oil. Not everybody can turn a patch of desert into a global megacity!

Yes, it really is true – as of today, less than 1% of Dubai’s GDP is generated by oil revenues. In fact, it’s commerce, financial services, real estate, and transportation that are the biggest drivers. The ultimate service economy!

Reproduced with kind permission of Sam Bidwell, Director of the Next Generation Centre at the Adam Smith Institute, Associate Fellow at the Henry Jackson Society, although views are his own.  Sam can be found on X/Twitter, on Substack, and can be contacted at [email protected].  This article was originally published as a X/Twitter Thread at https://x.com/sam_bidwell/status/1827802745740337507

Private security and the law enforcement gap

Sam Bidwell writes on the UK’s law enforcement crisis – and the signs that private security is emerging to fill the gap.

“In 2022, 89.2% of bike theft cases across England went unsolved, rising to 93% of thefts in London”

Alongside defence and border security, maintaining law and order is one of the first duties of any state – but in the UK today, many laws are just not being enforced. When we talk about law and order in the UK, we often talk about a few distinct but related issues: – softening of the law around some crimes

  • soft sentences
  • inaccurate data reporting
  • generalised disorder
  • non-enforcement of the law

I want to focus on the latter.

In May 2024, London’s Met Police announced that it would no longer be policing fare evasion on London buses. “Since this incident happened, we have stopped our involvement in supporting Transport for London fare evasion operations.”  December 2023 research revealed that the Met Police attended just 44% of shoplifting reports between April 2022 and April 2023 – the rate has not been above 50% since 2018.

“police failed to solve a single burglary over the past three years in half of neighbourhoods in England and Wales”

In 2022-23, Home Office statistics show that the Met Police failed to solve 82 percent of burglaries in London. Just 8 percent of London burglaries during this period resulted in a suspect being charged or summoned – we can assume that the conviction rate is even lower.  In 2022, 89.2% of bike theft cases across England went unsolved, rising to 93% of thefts in London. In Surrey, just 0.81% of bike theft cases resulted in a suspect being charged.

According to March 2024 research, police failed to solve a single burglary over the past three years in half of neighbourhoods in England and Wales. This comes despite an October 2022 promise from all 43 police chiefs across England and Wales to “attend every break-in”.

In 2023, police failed to attend 72 percent of car thefts – an increase of 32 percent since 2021. In Cambridgeshire, a full 90 percent of car thefts reports were not attended by an officer – in Bedfordshire that figure was 88 percent.

“the Co-op has reported that assaults on staff have increased by almost 30 percent, with 20 percent more anti-social behaviour and verbal abuse”

The police’s own data shows that, as of 2023, around 90 percent of all crime goes unsolved, rising from around 75 percent in 2015. This figure includes more than 30,000 sex offences, 330,000 violent crimes, 320,000 cases of criminal damage, and 1.5 million thefts.

According to February 2024 research, police failed to attend 40 percent of violent shoplifting incidents in 2023. This comes as the Co-op has reported that assaults on staff have increased by almost 30 percent, with 20 percent more anti-social behaviour and verbal abuse.

“The police are no longer consistently enforcing the law – particularly in cases of property crime, but increasingly in terms of low-level violent crime too”

Finally, across London, 250 phones a day are stolen – one every six minutes. In theory, the Met Police’s ‘Operation Venice’ is designed to crack down on phone snatching – but there’s no public information about the current state of that operation.  Pulling together these individual data points, what do we see? The police are no longer consistently enforcing the law – particularly in cases of property crime, but increasingly in terms of low-level violent crime too. This isn’t just a London problem, either.

This is especially audacious given the efforts made by police in recent weeks to crack down on ‘hate speech’ and improper political activism. They don’t have the resources to protect businesses from theft, but they do have the resources to put people in jail for sharing memes.

This leaves ordinary people subject to the tyranny of criminality – criminal disorder is just as tyrannical as any overbearing state. One of the results of this is a rise in private security use, particularly from businesses who know that they can no longer rely on the police.

“According to the British Security Industry Association (BSIA), the UK will need 62,000 new security officers over the next 12 months to keep up with growing demand”

My Local Bobby, a security firm established by two former Met Police officers, served 12 residential areas and four “public realm beats” as of May 2023, with a focus on property crime. Households pay around £100 to £200 a month for this additional protection.

According to the British Security Industry Association (BSIA), the UK will need 62,000 new security officers over the next 12 months to keep up with growing demand. BSIA estimates that a total of 450,000 licensed security professionals could be in operation by the end of 2024.

In a January 2024 poll, 6 in 10 UK adults trust private security professionals, while 7 in 10 say that private security professionals are necessary to maintain public order. An April 2024 poll, on the other hand, showed that just 4 in 10 Britons trust the police.  In the absence of a capable state police force, many businesses – and some individuals – are turning to private provision. Let me be clear – this is not a good thing! The expanding role of private security is a sign of withering state capacity.

“The early warning signs are there – including the growth in private security and the rise of gated and quasi-gated communities”

In countries where disorder is common – like South Africa, Nigeria, or Brazil -, private security is a fact of life. Nevertheless, these private security firms often operate under strict regulatory conditions, even while the state’s policing capacity continues to decline.

While Britain’s situation is not nearly as severe as Brazil or South Africa, we are experiencing a decline in law and order. The early warning signs are there – including the growth in private security and the rise of gated and quasi-gated communities.

We must resource our police force properly, enabling them to enforce the law consistently. Even John Cowperthwaite, Hong Kong’s famously laissez-faire Financial Secretary, understood the importance of a police force able to enforce order and protect property.

“The hard realities of keeping the peace between man and man and between authority and the individual can be more accurately described if the phrase were inverted to “order and law”, for without order the operation of law is impossible.” – Lee Kuan Yew, 1963

Reproduced with kind permission of Sam Bidwell, Director of the Next Generation Centre at the Adam Smith Institute, Associate Fellow at the Henry Jackson Society, although views are his own.  Sam can be found on X/Twitter, on Substack, and can be contacted at [email protected].  This article was originally published as a X/Twitter Thread at https://x.com/sam_bidwell/status/1824079066804146582.

Main image: Southbanksteve, CC BY-SA 2.0 <https://creativecommons.org/licenses/by-sa/2.0>, via Wikimedia Commons

Hong Kong, from small port to global finance centre

“Hong Kong transformed from a second-rate port city into a global centre of finance and commerce. But how did it achieve this?”

In the 20th century, Hong Kong transformed from a second-rate port city into a global centre of finance and commerce. But how did it achieve this? An overview of the use of ‘positive non-interventionism’, the economic philosophy which powered Hong Kong’s rise to greatness.

Hong Kong Island was ceded to Britain in 1842, in the wake of the First Opium War. Its strategic location was ideal for projecting British military and economic power into south China.  At the time, it was home to around 5,000 people, spread across several small fishing villages.

The city grew quickly, powered by trade with China and British financial interests in East Asia. By 1859, the island was home to some 85,000 Chinese residents, alongside 1,600 foreigners.  In 1865, the now world-famous HSBC was founded in Hong Kong.

The Kowloon Peninsula was added to the territory in 1860, and the so-called ‘New Territories’ were obtained in 1898 under a 99-year lease.  Thanks to the legal and political stability offered by the British, Hong Kong’s role as a trade entrepot continued to grow.

By the outbreak of the Second World War in 1939, Hong Kong was central to British interests in East Asia. The territory operated as a free port, with no tariffs on imports, which attracted merchants from China and Europe alike.  And then came the Japanese.

In 1941, Hong Kong was occupied by the Japanese after eighteen days of fierce fighting.  Japanese occupation was brutal. Civilians were regularly targeted for mass execution, banking assets and factories were seized, and a harsh rationing regime was imposed on the territory.

“he ensured that Hong Kong was granted financial autonomy from the UK, giving HK more freedom to make its own policy. He also resisted calls for a centrally planned industrial strategy”

On August 30th 1945, Hong Kong was liberated, and British control was restored. This is where Hong Kong’s remarkable rise really begins.  In 1946, Sir Geoffrey Follows was appointed as the territory’s Financial Secretary and charged with recovering from the occupation.

Follows oversaw a rapid short-term recovery of Hong Kong’s fortunes. In October 1948, he ensured that Hong Kong was granted financial autonomy from the UK, giving HK more freedom to make its own policy. He also resisted calls for a centrally planned industrial strategy.

In 1949, the Communist Party of China emerged victorious from the Chinese Civil War. Capitalists, Chinese nationalists, and political dissidents who feared communist rule fled to Hong Kong.  From 1945 to 1951, the territory’s population increased from 600,000 to 2.1 million.  Follows’ emphasis on free trade and stability, alongside the cheap labour and expertise of these new migrants, laid the groundwork for Hong Kong’s economic miracle.

What was the ‘positive non-interventionism’ which shaped the approach of the next three Financial Secretaries?  In short, ‘positive non-interventionism’ starts from the observation that Government efforts to shape resource allocation are usually damaging to growth, particularly in the private sector.

That’s the ‘non-interventionism’ – but what about the ‘positive’?  Successive Hong Kong Governments recognised that the state can take positive steps to ensure improved market function – such as investing in infrastructure, maintaining law and order, and providing legal and political stability.  That’s the ‘positive’ part.

“The territory had no income tax, and instead raised revenue through land value capture”

What did this look like in practice?

The territory’s next Financial Secretary was Arthur Grenfell Clarke (1952-61). Clarke refused to introduce regulation of the Hong Kong Stock Exchange, and the territory operated without a central bank or monetary policy.

The territory had no income tax, and instead raised revenue through land value capture.

At the same time, Clarke worked with his colleagues in Government to expand Kai Tak Airport, improve the Hong Kong Police Force, and crack down on triad-led gang crime.

“From 1961 to 1971, Government spending as a percentage of GDP fell from 7.5% to 6.5%. At the same time, real wages rose by 50% and acute poverty fell from 50% to 15%”

Yet the real star of the show is John James Cowperthwaite, the city’s Financial Secretary from 1961 to 1971.   From 1961 to 1971, Government spending as a percentage of GDP fell from 7.5% to 6.5%. At the same time, real wages rose by 50% and acute poverty fell from 50% to 15%.

Under Cowperthwaite, the territory imposed no controls at all on international capital flows. He refused to collect GDP statistics, fearing that these would only be used to enable economic planning.  Taxes were kept low, and Government focused on basic infrastructure delivery.

Hong Kong grew rapidly, powered by manufacturing, shipping, finance, and construction. The number of factories in the territory increased from 3,000 to 10,000 over Cowperthwaite’s tenure, while the number of foreign companies registered in HK almost doubled.

This approach was continued by Cowperthwaite’s successor, Philip Haddon-Cave. Indeed, Haddon-Cave coined the term ‘positive non-interventionism’ in 1980.  In 1975, Hong Kong emerged as the world’s freest economy, a position that it held continually in 2019.

Haddon-Cave worked with Governor Murray MacLehose to improve services without increasing taxes, tariffs, or regulation.  The pair agreed that Government should focus on delivering a few basic services, and should draw on private sector expertise for delivery of major projects.

With this approach, the duo clamped down on corruption and launched the famous Mass Transit Railway.  They also managed Hong Kong’s rapid transition from a manufacturing economy to a services economy – prompted, in large part, by a major change just over the border.

In 1978, Chinese premier Deng Xiaoping launched the Open Door Policy, which saw China open up to foreign businesses.  In 1980, Deng designated the small city of Shenzhen, just across the border from Hong Kong, as a ‘Special Economic Zone’, in order to encourage foreign trade.  Like Hong Kong, Shenzhen would boom in the coming decades.

“Rather than damaging Hong Kong, the growth of cheap manufacturing in China allowed the territory to transform into a hub for financial and legal services”

In the 1980s, its growth was powered by manufacturing. The city’s low labour costs and high regulatory flexibility made it attractive for businesses looking to reduce their costs – including firms in Hong Kong.

Rather than damaging Hong Kong, the growth of cheap manufacturing in China allowed the territory to transform into a hub for financial and legal services, with immediate access to cheap goods and cheap labour from China. Costs remained low and growth remained steady.

“Hong Kong’s remarkable growth continued throughout the 1980s and 1990s, guided by positive non-interventionism”

For those wanting to access the lucrative Chinese market, Hong Kong was a perfect entry-point. The stability of Britain’s common law system and HK’s light touch regulation gave foreign businesses confidence that their investments would be protected.

Hong Kong’s remarkable growth continued throughout the 1980s and 1990s, guided by positive non-interventionism.  In 1997, HK was returned to China, after more than 150 years of British rule. Nevertheless, positive non-interventionism has continued to shape HK’s economic policies.

Though HK faces challenges today, it continues to stand as a global hub for financial and legal services.  Its remarkable story is testament to the power of free markets – but also to the importance of limited, effective government which focuses on stability and order.

Reproduced with kind permission of Sam Bidwell, Director of the Next Generation Centre at the Adam Smith Institute, Associate Fellow at the Henry Jackson Society, although views are his own.  Sam can be found on X/Twitter, on Substack, and can be contacted at [email protected].  This article was originally published as a X/Twitter Thread at https://x.com/sam_bidwell/status/1817279031345352801

How London’s Docklands were saved

“Ships with goods from around the world, particularly from across the British Empire, were onshored and processed here. By 1900, London’s docks were the busiest in the world”

Once home to the largest port in the world, London’s Docklands had fallen into disrepair by the 1970s. Today, the Docklands is one of London’s most modern, attractive areas, home to a leading financial district and even an airport.

Throughout the 19th century, London’s Docklands grew rapidly, starting with West India Docks in 1802. Ships with goods from around the world, particularly from across the British Empire, were onshored and processed here. By 1900, London’s docks were the busiest in the world.

In March 1909, the separate docks were consolidated under the control of the Port of London Authority, which was responsible for management of the docks. Tens of thousands of people were employed here, and at nearby mills and factories which depended on the Docklands.

During the Second World War, the Docklands were heavily bombed in an effort to cripple Britain’s international supply chains. Much of the area’s infrastructure was destroyed, including almost 1/3 of the area’s housing. Still, the Docklands saw a brief resurgence in the 1950s.

“London’s docks were unable to accommodate the larger vessels needed for modern container shipping, and the shipping industry moved to deep-water ports like Tilbury”

Then came the shipping containers.

Throughout the 1960s and 1970s, shipping companies came to rely on a standardised system of shipping containers, which could be loaded and unloaded at most major global ports. This new system relied on larger vessels, and fewer human labourers.

While containerisation made international shipping cheaper and more efficient, it was terrible for the Docklands. London’s docks were unable to accommodate the larger vessels needed for modern container shipping, and the shipping industry moved to deep-water ports like Tilbury.

Between 1961 and 1971, almost 83,000 jobs were lost in the Docklands. By 1980, all of London’s docks had finally closed, leaving behind about 8 square miles of derelict land in East London. Almost all housing in the area was council owned, and crime grew rapidly.

“Ward claimed not to have a master plan – “instead, we have gone for an organic, market-driven approach, responding pragmatically to each situation.”

In 1979, Prime Minister Margaret Thatcher came to power. She charged her Environment Secretary, Michael Heseltine, with addressing the decline of Britain’s post-industrial urban areas, including Docklands. Some members of her cabinet proposed to abandon the Docklands entirely.

Instead, Heseltine pursued a radically different approach. In 1981, he created the London Docklands Development Corporation, charged with spearheading a market-led revival of the Docklands. All local planning powers were handed to LDDC, despite protests from local councillors.

Planning decisions in the area would be made by LDDC. It received an initial grant of £80 million p/a, and in 1982, Heseltine created the Isle of Dogs Enterprise Zone, with no land tax, no planning restrictions, a 100% tax write-off on capital costs and a 10-year tax holiday.

The man in charge was Reg Ward, who was appointed CEO by Heseltine. The supremely pragmatic Ward claimed not to have a master plan – “instead, we have gone for an organic, market-driven approach, responding pragmatically to each situation.”

The first few years of LDDC were spent attracting investment for new riverside housing, bringing in small-scale industry (like Billingsgate Market in 1982), and opening up new office space. The proximity of Docklands to the City made it an attractive second site for businesses.

Derelict land was cleaned up and sold to developers, while the absence of local planning hurdles made the area attractive for private businesses looking to invest. By 1986, the LDDC had spent around £300m of public money, but had attracted £1.4 billion in private investment.

“DLR opened in 1987, under-budget and ahead of schedule, with subsequent expansions between 1991 and 1994”

In 1982, Ward commissioned the new Docklands Light Railway (DLR), which would make it easy to get from Docklands to central London. Running mostly on disused railway lines, DLR opened in 1987, under-budget and ahead of schedule, with subsequent expansions between 1991 and 1994.

In 1983, Ward began pushing for an airport on one of the old quays, which would cater to business travellers looking to make short-haul flights between London and Europe. Operations at London City Airport would begin in 1987.

Ward’s greatest success came in 1985, when Ward met for lunch with American-Swiss financier Michael von Clemm. Von Clemm was interested in opening a restaurant in the area – but upon visiting, realised that Docklands would be a prime location for office space.

“Canary Wharf accounts for 67,000 finance sector jobs, putting it ahead of Frankfurt as a banking centre”

Ward worked with Von Clemm to draft a proposal for a new business district, taking advantage of the area’s lack of red tape. In 1988, the project was sold to Canadian developers Olympia & York, with the first buildings finished in 1991. This development is known as Canary Wharf.

Canary Wharf accounts for 67,000 finance sector jobs, putting it ahead of Frankfurt as a banking centre – and it’s no longer an office monoculture. Count in the hotels, shops and restaurants, and Canary Wharf employed around 120,000 people, pre-pandemic.

The LDDC began a staged withdrawal in 1994, and was formally wound up in 1998. Planning powers were handed back to local councils, and the area’s special tax incentives were gradually rolled back. But what Heseltine, Ward, and others had achieved was incredible.

Once-derelict Dockland had been revitalised, with attractive riverside housing, a shining new financial district, an airport, and a local transport system. For most of its history, LDDC managed to do this almost entirely by attracting private investment.

LDDC even managed to reverse a population slump in the area that had begun in the early 1900s, encouraging upwardly mobile ‘yuppies’ to take their first step on the property ladder in the attractive riverside communities of the Docklands.

“decline is not inevitable – with ambitious, pro-growth policies, we can achieve incredible things”

What can we learn from Docklands?

  • First, that decline is not inevitable – with ambitious, pro-growth policies, we can achieve incredible things.
  • Second, that areas perform best when govts allow their natural strengths to flourish – such as Docklands’ proximity to London.
  • Third, LDDC shows us the limits of localism. Local government figures, including Greater London Council Leader Ken Livingstone, hated Docklands. Critics said that LDDC was elitist and undemocratic – after all, it had the power to ignore local wishes entirely.

While the localism of the 1960s and 1970s had created poverty and decline, the efficiency and ambition of LDDC turned Docklands into one of Europe’s leading financial centres. Clean, modern, and full of potential. A sparkling sign of what is possible if we dare to dream.

Reproduced with kind permission of Sam Bidwell, Director of the Next Generation Centre at the Adam Smith Institute, Associate Fellow at the Henry Jackson Society, although views are his own.  Sam can be found on X/Twitter, on Substack, and can be contacted at [email protected].  This article was originally published as a X/Twitter Thread at https://x.com/sam_bidwell/status/1815055102702498300?s=46

Birmingham: Cradle of the industrial revolution to decline and bankruptcy.

Birmingham used to be one of the world’s greatest cities. From 1954-64, service businesses around Birmingham grew faster than any other part of the country. In 1961, West Midlands households earned more on average than any other British region. This is how we ruined it…

“By 1900, Birmingham had more miles of canal than Venice. Between 1923 and 1937, the city’s population grew nearly twice as fast as the national average”

The West Midlands was one of the cradles of the Industrial Revolution. The region was the birthplace of the steam engine, while Birmingham itself was regarded as one of the world’s foremost cities. In 1890 it was described by Harper’s as “the Best-Governed City in the World”.  By 1900, Birmingham had more miles of canal than Venice. Between 1923 and 1937, the city’s population grew nearly twice as fast as the national average. The compact cavity magnetron, indispensable for radar, was invented there in 1940.

But Westminster viewed this growth as a threat to other regions. The Distribution of Industry Act 1945 sought to slow industrial growth in ‘congested’ areas like the Midlands, and push it towards declining industrial cities in Northern England, Wales, and Scotland.  The Act gave the Board of Trade veto power over planning applications for factories of a certain size, and created “development areas” in which the Government was charged with managing industrial estates. Walter Higgs MP, speaking during the debate:

“local government was obliged to achieve a target population of 990,000, lower than its actual 1951 population of 1,113,000”

In 1946, the Government commissioned the West Midlands Plan, which attempted to constrain Birmingham’s growth – local government was obliged to achieve a target population of 990,000, lower than its actual 1951 population of 1,113,000.

The Government wanted Birmingham to shrink.

In 1947, the Town and Country Planning Act created Industrial Development Certificates (IDC). A company had to obtain an IDC if it wanted to expand an industrial plant beyond 5,000sq ft. This gave Government control over where industry could and could not be built.

“From 1951-61, Birmingham created more jobs than any city but London, with average unemployment less than 1%”

These restrictions constrained the city’s industrial growth – but despite these controls on heavy industry, there was relatively little regulation of service businesses. From 1951-61, Birmingham created more jobs than any city but London, with average unemployment less than 1%. 

“in 1964, the incoming Labour government declared Birmingham’s growth “threatening”

However, in 1964, the incoming Labour government declared Birmingham’s growth “threatening”. It restricted the development of new office space for almost two decades through the Control of Office Development (Designation of Areas) Order 1965.

And in 1975, plans for a West Midlands Green Belt were finalised, stifling the city’s housing growth. After decades of success, the Government had made it harder than ever to build new factories, new housing, and new offices in Birmingham.

The result? In the 1980s, Birmingham’s economy collapsed, with unprecedented levels of unemployment and outbreaks of social unrest. This wasn’t the result of neoliberalism – anti-growth regulation left the city vulnerable to global economic shocks.

“We have a tendency to describe fast-growing regions as “overheated” (see: modern London) – this is a dreadful instinct”

What can we learn from Birmingham?

1. We have a tendency to describe fast-growing regions as “overheated” (see: modern London) – this is a dreadful instinct. Where a local economy works, Government should enable it to flourish, rather than seeking to spread that growth thinly.

2. Britain’s regional inequality is a product of regulation, not big business. Without the above regulations, Birmingham would likely still be a thriving second city. If we want to “level up” the rest of the country, we should liberalise planning and provide cheap energy.

3. Industrial strategies don’t work. For every good example of industrial strategy, there are five examples of expensive failure. Instead of trying to direct growth, Government should be aiming to create conditions in which growth can occur naturally.

Reproduced with kind permission of Sam Bidwell, Director of the Next Generation Centre at the Adam Smith Institute, Associate Fellow at the Henry Jackson Society, although views are his own.  Sam can be found on X/Twitter, on Substack, and can be contacted at [email protected].  This article was originally published as a X/Twitter Thread at https://x.com/sam_bidwell/status/1812177506822144055.

Main images includes a ‘View across Birmingham’.  Source Smileyface on 20 July 2021, at https://www.flickr.com/photos/whataloadofmoo/51323892597/.