Blair v Brown: the Debate that Never Went Away

Finito World

For the past few weeks, British politics has been conducting two entirely different conversations about the economy.

On one side sits Andy Burnham and the increasingly dominant language of inequality, insecurity and protection. On the other sits the re-emerging Blairite tendency, represented now by figures like Alan Milburn and, increasingly bluntly, Tony Blair himself: a politics less concerned with distributing wealth than with generating it in the first place.

The publication of Milburn’s report into youth unemployment exposes the contradiction inside Labour beautifully.

The numbers themselves are alarming enough. Nearly one million young people in Britain are now classified as Neet: not in education, employment or training. The unemployment rate for 16 to 24-year-olds has climbed to 16.2 per cent, the highest level for more than a decade. Milburn warns that without urgent action, the number could rise to 1.25 million by 2031.

But what is striking is not simply the scale of the problem. It is Milburn’s diagnosis of it.

“This is not a failure of young people,” he said this week. “It is a failure of a system stuck in the past.”

Elsewhere he described young people as being trapped in a “hopeless catch-22 where employers ask for work experience but the opportunities for young people to gain it have narrowed or gone”.

That is not the language of redistribution politics. It is the language of opportunity politics. Fundamentally, Milburn is making a Blairite argument.

Young people are not failing because they lack aspiration. They are failing because Britain no longer creates enough entry-level opportunity. The “first rung” of the ladder has thinned or disappeared entirely. Employers demand experience for jobs that once provided experience. Young people send hundreds of applications into a void and hear nothing back.

Milburn himself admitted: “I’ve never known anything like this.”

The evidence increasingly supports him. Next recently revealed that the number of applicants for entry-level shop jobs has almost doubled in two years. Lord Wolfson said the retailer previously received around ten applicants per vacancy. It now receives nineteen.

Again, the point is not merely statistical. These are exactly the kinds of jobs that once gave young people their first experience of adult life: reliability, confidence, social competence, financial independence. Britain’s economic system is quietly removing the lower rungs of the ladder while still insisting people climb.

And this is where Labour’s internal contradiction begins to sharpen.

Because while Milburn argues businesses need stronger incentives to hire inexperienced young people, the government is simultaneously advancing labour market reforms that many employers believe will make hiring riskier, more expensive and less flexible.

Angela Rayner’s Employment Rights reforms are likely to exacerbate the problem which the same government, through Milburn, is highlighting today. The desire to reduce exploitation and insecurity is understandable. But the reforms rest on an implicit assumption that the central imbalance in Britain lies between employer power and worker vulnerability.

Milburn’s report suggests something rather different: that Britain’s deeper problem is stagnation itself. A stagnant economy does not create ladders. It protects incumbents while freezing out newcomers.

This is why the argument now emerging between the Blairite wing of Labour and figures like Burnham matters so much. Burnham’s politics often assumes inequality itself is the defining national problem. Blairites increasingly suspect inequality is becoming a secondary effect of something deeper: the collapse of growth, dynamism and opportunity.

That distinction matters enormously. Because you do not solve inequality merely by regulating existing businesses more heavily. You solve it by creating an economy dynamic enough to generate vast quantities of new work, new firms and new routes upwards.

The danger for Labour is that it increasingly resembles the Conservative Party during Brexit: two rival philosophical coalitions temporarily sharing one electoral vehicle. One side believes markets are fundamentally the problem and security the answer. The other believes Britain’s core crisis is the collapse of growth, risk-taking and opportunity itself.

Those two positions can coexist rhetorically for a while. But eventually reality forces choices. If Milburn is right that Britain faces a “lost generation”, then the solution cannot simply be more programmes, more guidance schemes or more state management. Young people ultimately do not need another motivational workshop. They need employers willing to take risks on inexperienced workers.

And employers only do that when they feel confident about growth. This is the uncomfortable truth creeping back into British politics through the Blairite back door: you cannot redistribute opportunities that no longer exist. Nor can you tell businesses to hire more young people while simultaneously making hiring materially more difficult.

Britain spent years arguing about fairness while quietly allowing the machinery of opportunity itself to decay. Now the consequences are arriving all at once. And Labour, like the Conservatives before it, is discovering that its deepest divisions are not really about personalities at all. They are about fundamentally different understandings of how prosperity is created in the first place.

This is the kind of problem which a change of leader won’t solve – indeed, it may even make it worse by kicking the policy can further and further down the road.