Welfare Britain? Tax Cuts to Crypto with Kwasi Kwarteng, former Chancellor of the Exchequer

Quasi. Is the UK broken right now?

Well, look, I think obviously the left, the Labour Party have come in and it's very much in their interest to say everything is terrible, everything doesn't work. Now, I think the Conservatives and, you know, me, I was involved in that. We got things wrong, we have to accept that. But there were some things we got right. And if you look at the GDP growth, it's pretty competitive, actually.

Is it?

I think. Well, the whole of the west is. It could be a lot better, let me say that. And obviously I tried with Liz Truss and others to try and kick start the growth, but, you know, we're not doing worse than people in France or Germany. I don't want to relitigate Brexit, but the whole Brexit thing was about, oh, well, you know, we should stay in Europe because they're doing better than us. They're not, they're not doing better than us. So a lot of the problems we face, you know, large immigration levels, creaking public services, quite slow growth, all of these problems are faced across the west, particularly in Europe. And so if you say Britain is broken, you might as well say Western Europe is broken. We all face challenges and obviously we've got to grip them.

So you said the Conservatives did some things right and some things wrong. Give us the summary of what you think you, the Conservatives did right and wrong.

So I think the problem we had was essentially, for six years we had this austerity narrative, which was probably not the right narrative. I don't disagree with austerity, but I think we exaggerated the extent to which we were restraining spending. And then after Brexit, there was all hell broke loose. And I'll give you an illustration of this. I was in Parliament, Theresa May was the Prime Minister, and out of the blue, she called a general election. I don't know whether you remember it, but the 2017 election came out of a clear blue sky. Nobody was expecting that. And she went into the election with a majority and as a consequence of the election, we lost our majority. So then we had two years where there was no majority in the House of Commons. We were trying to get Brexit legislation through and it was a mess. We didn't get anything through the House. We came up with a deal. She couldn't get the deal through and that ultimately was why she had to leave office. And then we got Boris. He managed to get things sorted out in a way, he got his majority. And then literally about three months after we won the 2019 election, we had to deal with COVID which was a completely different kettle of fish, completely unforeseen. We were spending hundreds of billions of pounds. Hundreds of billions.

Was it about a trillion all in. Spent on.

Yeah. I mean, it depends how you measure it. But I'll give you an illustration. I remember in 2018, it's not long ago, six years ago, that was the 70th anniversary of the National Health Service. And I was working very closely with the Chancellor then at the time, Philip Hammond and Theresa May was the Prime Minister. And she essentially said, look, we've got to spend a lot more on the health service. And the number was something like 84 billion over the. Over the parliament in Covid. So 84. That's what you got to remember in Covid. We were spending hundreds of billions of pounds. Hundreds.

Just on the nhs.

Yeah. On. On. On business support and also on the nhs. So. So the. In terms of public spending. And it wasn't. It was a health emergency. That was what it was. And so a lot of the money was going through the Health Department, and so the scale of spending was way higher than anything that had happened before.

And where did that money come from?

Well, initially it was borrowed. And this is where my brief stint as Chancellor comes in. In the end, we were just hiking up taxes, and that's what we're doing now. We're just hiking up taxes essentially, to pay for the money that we spent four or five years ago. And I think what Liz Truss and I tried to do was to break. To jump out of that. That ratchet, to jump off that train where essentially we were just spending money and taxing more to cover the spending.

And, you know, that you tried to incentivize.

Well, yeah, we tried to reduce the taxes and give. And at the time, I think there were issues in terms of the speed, there were things that were unlucky. And then we freaked out. I was sacked memorably. For me, I think it was.

Do you think you were made a scapegoat?

Well, I mean, I was the number two and I'm a great believer. Yeah, I was the Chancellor and I'm a great believer in the buck stopping where the leadership is. So ultimately, the Harry Truman thing, when he says the buck stops here. Yeah, he said that. He didn't say that when he was Vice president. He said that when he was president. The. The leader has to take responsibility. And what I said to the Prime Minister at the time, it was obvious to me that if she sacked me, she would probably last about maybe a month. If she was lucky, possibly three weeks. And I actually said to my special advisor, I think she's got about three weeks. Once, once I was sacked, I thought she had about three weeks. I was actually wrong, it was six days.

Wow.

She. So she, she. I was sacked on the 14th of October, Friday. Remember it very well.

And why were you sacked, do you think?

Well, I think it was essentially because the market reaction had been very adverse to what we were doing. Guilt rates had gone up, there was a whole bunch of stuff we weren't aware of, we hadn't been told about, about guilts and pension funds being exposed to what's called long dated government debt and they borrowed money to buy that debt. And she felt, and what was so bizarre about it was that I was away in America. So I was at the IMF meeting and I was called back a day early and my view was that that's just going to make it worse, that's just going to add to the air of panic. You just try and be calm even though things are going crazy. Anyway, she called me back. I found out on Twitter that I was sacked and was very sort of Trumpian. And I remember my special advisor said, Steve Swinford, he's a writer on the Times, a reporter, he says, you're going to be sacked. And I said, and he said, do you think that's true? I said, yeah, if it's Steve Swinford, he was the go to man. It's definitely happening. So I walk into, I get driven to Downing street, walk into the Cabinet Room and it's that long, there's a long kind of oval table which can fit like 25 people around a full cabinet. And, and she's sitting in the primary chair, which is in the middle and I'm sitting opposite. So we're in this room alone and she says to me, you're gonna have to go. And at this point she's quite emotional, crying as I remember. And I'm just totally dry eyed, like I'm speaking to you. And I'm looking at her thinking, are you mad because this isn't going to make things better, it's going to actually make things worse. And she said to me, well, you know, I've got prepared a press conference and she was kind enough to show me what she was going to say. And all I said to her, I said, look, forget about what your statement in the press conference is, all they're going to ask you is whether is if you sacked the guy for doing what you wanted, why are you still there? That's the only question they're gonna. Or some variation of that. Anyway, she, you know, acknowledged that and then she had the pressure. I was sacked. I left Downing Street, I got my bag from number 11, got into the car, drove home, driven home, and then she had the press conference. And at that point, it lasted about nine minutes, and of course, four people are, four journalists asked her variation of the question I just put forward, said, if you've got rid of that guy for doing what you said, what you wanted, why are you still there? And at that point, I thought she wasn't going to last. And in the end, what happened was there was a whole sort of series of House of Commons, you know, debates on fracking and all the rest of it, and there's total confusion about what the Whip was and all the rest of it. And then on Thursday, so I was sacked on Friday the 14th, and on Thursday the 20th, six days later, she announced her resignation.

And do you think she was pushed?

I think a little bit. I think she. Because you can't imagine. I mean, I was under a lot of pressure. She was under huge pressure and I think.

From who?

From. From lots of people. I mean, I think there was, you know, clearly the bank of England, the treasury, all those institutions, and they were looking, I mean, in her.

Are they supposed to be separate from government?

They, they, they are and they aren't. I mean, they're. They can't. They can and can't be. Because if you. If you think about how the government works, treasury, about 5,000 civil servants there, something like that, I mean, thousands of people, and at the top level, they're talking to bank of England people. A lot of the bank of England people are ex treasury people. So all these institutions are very interwoven. And so, you know, people talk about the Blob people talk about the administrative state, whatever phrase you want to use, there's a whole bunch of people who think roughly the same way. And Liz's contention is that they essentially conspired to get rid of her. Now, I don't. I think it's partially true, but I.

Think that it was super quick, wasn't it?

It was very.

And your policies didn't even have five minutes.

No, it's a real shame. And I look at where we are now and I'm just very sad because I can see what Rachel Reeves and the. And it's not. It's not her, it's the administrative people behind her. The logic of where we are is, you know, they've agreed to a Huge, you know, wage increases for the public sector that need to be paid for. I mean you're an entrepreneur, you work for yourself. So you've got to generate, if you get a wage increase, you've got to generate that from your business. Yeah.

And generally you would pay people more if the job that they're doing is productive.

That's right.

How many of our public services not failing?

Well they, they didn't even ask that question, they just gave.

Because that was 10 billion straight away.

Yeah, yeah that was 10 billion.

They said there's a 20 odd billion hole. That's exactly 11 billion overseas. Exactly 10 billion for public sector.

That's exactly right. And so now all this business of the winter fuel payment, they're trying to do that to cover the cost of the increase in the public sector wage.

How many people are going to die because of that lack of winter fuel payment?

And what I try and get across is that these are political choices. They come in and say oh we're forced to do that. No, they weren't forced to do that. No one put a gun to their head and said you've got to give the unions 10%. Well I don't know, maybe they did, I don't know. But nobody as far as I know compelled them to do that, that deal with the, the unions.

Yeah.

And in order to. And then they complain about the black hole. I've never heard of such a thing. How can you complain about a black hole on the one hand and then on the other.

What is a black hole?

Well essentially it's just the difference between expenditure.

Yeah, but aren't we like 2 something trillion down in total?

Yeah. So there's the debt.

Yeah.

And so aren't we always down? Yeah, yeah. So there's the debt. So it's like, it's like a mortgage. So you might have 100 grand mortgage and that's your sort of long term black hole as it were. But then you've got a current account issue. So if you're earning you know, a thousand pounds a week, which is a lot of money, but you're spending 1200 your kind of current.

But have, has 200 has income ever met expenditure?

It has actually. I mean but very. Quite a long time ago actually the last time I think the British budget was balanced was 2001. 2000.

Do you know if a company did that the directors would be struck off and that'd be called insolvency.

Yeah, but the countries willing insolvency. Countries have a different, well they have different rules I was talking to. Sorry, I was talking to a French politician and I was pointing out, actually the last time we were in surplus or balance was in 2001, which is nearly 25 years ago. And he said, oh, that is nothing. We haven't balanced the books in 74.

But that's mad because all that means is our currency just keeps devaluing. Essentially.

It does. And also it means you're just building up huge amounts of debt. And that's something which.

And then that essentially is a tax on us.

That's right. The future.

Yeah.

And I think it's a drag on growth. But the extent to which, and that was actually one of Liz's points, was that we actually had quite low borrowing levels as a country. If you look at our net borrowing, which is 2.7 trillion or whatever it is compared to the GDP now, it's about 100%. Japan is 250, well over 200%. The US, France, they're all more indebted, if you look at that measure, than we are. And so her thinking was that, well, we should be able to borrow so that we can grow the economy, which is a kind of version of what I think labor are going to try and do. They're going to have to. They think they're going to spend money to grow the economy.

Now, my philosophy is, don't they just seem to be putting all the taxes up?

That's right.

And I think there's five or six separate taxes it looks like they're paying.

That's what I think that's going to happen. This is the doom loop. I think they, I don't think they're going to get growth. They've massively increased spending and the term 5, 10%, you put on, you know, public sector pay. That's not going to go down. That just means your cost base starts at a higher level. And if you don't get growth, you're going to have to get more money through tax to pay for that. And that's the problem we're at. And that's why, anecdotally, and I think there's a lot of evidence to suggest this, a lot of very wealthy people are already leaving Britain.

Do you know what? I'm an entrepreneur and virtually every entrepreneur I speak to is leaving or wanting to leave or planning to leave.

Yeah. And I can see why they're doing that.

Is it. Is there no one in, you know, Starmer's here or Reeves Azir going? They're all leaving. You know, all the people that Generate all the money.

So two things about that. At one level, they don't really believe.

It or do they not care?

And that's another level, I don't think they care.

Do they? Do they dislike entrepreneurs at a deep.

Level, they will never admit that, but.

You know, fundamentally, in their core.

Yeah. I mean, your result. You're almost as old as I am when we're just discussing this. I'm 49, you're 45. So you're almost. I'm your age plus the VAT. But, but so we remember, we have a memory of. We don't remember the 70s, but we know, you know, growing up in the 80s, the socialism, Arthur Scargill, all of this stuff. And we know a lot of young people don't know this, but a lot of people our age know what a socialist government, what socialist ideas mean. And fundamentally, I think if you're a socialist, you prize equality above success and allowing people to, to succeed or fail. You know, it's a. Basically a new castle safety net.

But do they not understand that it's all the successful wealthy people that pay for everyone to be equal?

So they don't believe that they would say, I remember Obama saying this, and I was at a speech when he gave. I can't remember when it was before I was an mp, maybe when he became president, whatever. I happened to be in the states. And he said, it's not the entrepreneurs who've made the money, it's the state that has facilitated, you know, it's the state that provided the schools, it's the state that provided the laws, it's the state that provided all of this.

But entrepreneurship and business isn't really taught in schools. We had to go and learn ourselves.

Exactly, exactly.

So how can that be so? But their view is who employed all the people.

That's right.

Who built all the buildings?

So it's very much a state. Even Obama, who was.

How can they be that?

He's a centrist and he said it was the state that basically enabled the entrepreneurs to make money. And I'm like, yeah, at a basic level in that it's got law and order, so it means you're not going to get killed, hopefully, touch wood. But essentially it's not driving the growth. There's no way you could tell me that government is driving economic growth in that way, in the way that we are used to or the way that built up the cultures that we have in the West. But they. The socialist doesn't think like that. And I think fundamentally, someone like Keir Sir Keir, who I know a bit. We can talk about it later. But he. He was the Shadow Brexit secretary when I was the under Minister, the undersecretary, so we kind of faced each other in parliamentary questions. Always very courteous. But he's a strong hand of the state guy.

He's a socialist.

Yeah, fundamentally. Fundamentally. I think if you. If you had a beer with him and he trusted you and you had a chat, I think deep down he would describe himself as a socialist. It's not a dirty word, but we just got to accept what it is.

I did. I feel quite dirty.

But you've got to say, you know, he's got. You gotta. You know, you understand what socialism is. And I'm afraid, I think that's where he's coming from. So, you know, he doesn't mind taxing people he thinks are rich. At some level, he thinks that wealth is almost like a dirty word. He inherently thinks. Or a socialist inherently thinks the public sector is good and the private sector is somehow something dodgy about it.

But 55 of the economy is small businesses.

That's right.

They want to bite the hand that feeds them and they dislike the people that feed them. I don't.

It's mental. But that's the. What, Forgive me. That's what they believe. So I think the problem that they.

Have is because, by the way, they're not just go. You know, when we talk about entrepreneurs, they're not just going for the super rich, they're letting the super rich off.

Yeah. And the super rich are super rich.

Yeah.

So guess what? They've got enough money and means and.

Accountants and lawyers and they can move to whatever jurisdiction, but it's actually now moving down and down and down, where the middle class and the working class are getting treated like the rich.

Yeah. So the phrase, And I agreed with this when Theresa May and her team came up with it, the phrase she used to talk about was the squeeze middle, you know, and that is very much what's in play, because as we've just said, the super rich have got lots of means to dodge or get to get out of whatever hole, you know, or whatever net the labor government costs on them. But it's the people who aren't mobile. They've got two or three kids who are being educated here. Some might be in private schools, someone might be in state schools, they've got houses, they've got property, they've got relations here. They're from Britain, they can't just up and leave. It's Much harder for them to do that. And if you're an official or someone trying to raise tax revenue, it's those guys that are much easier to tax.

Than some because they haven't got the means.

Yeah, some billionaire, you know, a billionaire, he could be in Monaco one week, he can be in Dubai the next week, he can be in Vegas the next week. You know, they're very mobile people. So it's much harder to attack someone who can flit around the world, essentially, than somebody who is living in a house in Lewisham or Croydon or wherever, you know, in Leeds, wherever, and is making their way either through a small business or as a professional and educating their kids, that those people and their kids are, you know, young kids, those people are far less mobile. And it's much easier for a tax system essentially, frankly, to squeeze them than to go after the really rich people.

I want to come back to that. I just, I want to understand what I'm not seeing as someone who's, you know, been the chancellor. What am I not seeing? Because my common sense tells me if you encourage people to start a business, give them a few tax breaks, they're going to employ people. So you create employment, you create additional revenue through additional sales and additional products and services created. You could even tax on a sliding scale. So because it's called a progressive tax system, but it isn't really. But what about year one, you don't pay any tax as an entrepreneur. Year two, you pay a bit more. Year three, you pay a bit more. I don't understand why, if we don't incentivize entrepreneurship and businesses and startups, I don't understand why they can't see how that's not going to be good for the economy, number one. And then number two, why are we sending all the talent away? Why are we sending all the billionaires away? Why are we sending all the tech people away? You know that they had a massive AI budget cut when labor came in. Why are we not bringing all those back in? Or why are we not bringing these billions in? What am I missing? Because to me, surely that's the best way for economic growth.

So the way in which I think you're 100 right, and I happen to agree with you, but the way in which the official mind works and government and they've got, they've got to pay things in year zero, they've got to pay for things. The welfare state, the national health service, public sector, wages, roads, all of this stuff they have to pay for on a day by day Basis, a week by week basis. And so a lot of things you're saying may bear fruits two or three years down the line, yet in the immediate term they have to pay for the state essentially. And so yes.

Why do they take 2% extra corp tax off the billionaires then the billion pound corporations?

Well that's the sort of thing paying.

4% corp tax when I'm paying 20.

Yeah, that's the sort of thing that they, they.

Because that seems fair.

Yeah, that's the sort of thing they may, I mean I might dispute that, but that's the sort of thing, they may dispute it. Well, because I think that essentially. So we looked at this in terms of a sales tax because one of the issues that you.

Oh no, I'm not talking about an extra tax, I'm talking about Corp tax is 20% but the billionaires managed to get away with paying 4. Yeah, so just, just bring them more in line with.

Yeah, they could do that, they can do that. But then the argument against that is that the, the mega corporations will just not touch, will not go anywhere near Britain and they'll get Ireland and Europe or not Europe, but places which are more favorable. So there's that tax competition.

Okay.

And I think that, but you're right to say that some mega corporations could probably pay a little bit more. But, but, but, but the government would come after them and come after anyone willy nilly. And just as the rich people can flit around, the super rich, the mega corporations can insulate themselves as they are doing. And that's what you're mentioning against whatever tax measures you're, you're bringing in. But your small business, you know, on the high street in Manchester, wherever Oldham, wherever Lewisham, they're the ones who are going to get hit just as the people who are professionals, middle class people who aren't very mobile, they're the ones who are going to get hit. And that's what I tried to, you know, as a, in government, Liz and I and others, we tried to stop that.

So you tried to reduce taxes completely and what was your theory and goal behind.

So I think what, so my, my big regret was that we try to do everything at once, which you should never do. You've got a stage and slice and dice things. That's my natural instinct. But having gone through what I went through, I'm convinced more than ever that's what you do. You can't.

So you did too much too soon.

I think it was too much too quickly. We didn't prepare the market, we didn't prepare lots of things. And, you know, that was something we were responsible for. I mean, nobody told us we had to do the budget on the. On the. Whatever date it was, I think was the 23rd of September or something very early on in the. In the government. Nobody, you know, that was us. That was. We decided to do that. Wasn't the market, wasn't, you know, conspiracy.

Were you just, like, keen to sort of. Yeah, I think we were.

Yeah. We were very keen to move things fast. The Prime Minister was very dynamic, wanted to move very quickly. And in retrospect, I think it was too much too fast. We should have taken a more cautious approach. The metaphor I think of is, you know, if there's a field strewn with landmines, you're not going to sprint through it. I mean, you can try and do that.

Yeah.

But actually, sometimes it makes sense to try and pick your way through the landmines and. And see what. What's underneath the. The COVID Right.

You. You two just both went.

We just sprinted again. And I don't think that that works. But I think what you're trying to do, and I see this now is, you know, we. Because of COVID Because of lots of other reasons, we. We've. We've. We've. As a country, as a government, we've hiked up taxes and those. That tax burden, which is higher than it has been for 70 years, and we're talking about.

It's higher than the 70s.

Oh, yeah. As a proportion of the GDP of the country, the tax take is higher since I think it's the late 40s and it's going up.

And I guess we needed it in the late 40s to pay for the aftermath of the war.

Exactly right. Exactly right. So, you know, one of my favorite subjects is economic history. You look at the charts, you know, our debt in 45, 1945, was something like 250 of. Of GDP, and today it's 100. So because we'd paid for the war, that cost us a fortune.

Yeah.

And it took us a while to get that down as a proportion. And the way we got it down, the way that most Western European, Western countries got it down, was through growth. So the growth rates from about 1945 to the 70s were between 2 and 3% a year. And if you're growing your economy at that rate, the amount of debt you have shrinks as a proportion of your wealth. It's again, like a mortgage. You get a mortgage when you're earning 40 grand a year.

If you Overpay it a few percent.

That's right.

It's going to come down.

It's going to come down and you might get a pay increase. And after 10 years, if you're doing well in your career, the debt will seem quite small.

Yeah.

But on the other hand, if you get a whopping rate, you know, mortgage, and your income doesn't go up and your costs are going up, then it.

The lockdown, basically.

Yeah. The debt is a large portion. So we got our debt down after the war by growing the economy, essentially. And then this Covid, when It came in 2020, the fiscal effect, the effect on our borrowing, on our. The amount we were. We had to spend was almost like a war because it was such a huge amount of money. Yeah, it was. If you look at the numbers, it was almost like the effect of. Of having a war.

Did we need to spend that much on it?

That's a great question. And I think lots of people will. Will debate this for a long time. I mean, I remember I was attending Cabinet. I was in Cabinet for part of that period. And I think the fear was. And Boris will have his own ideas, but I think they just. My sense was that Boris's instinct was not to go down lockdown. He just thought he had immunity. And that was the conversation, as I remember it, beginning of 2020. But you could see every other country was doing it. And again, there's huge pressure when you're in government. There's huge pressure from the media, from.

Social media, and a strong leader able to make their own decisions.

I think it's a lot hard. I think they can in theory, but I think it's a lot harder for leaders to do that in an age of 247 media and social media than it was in the 80s. I mean, you know, I don't know how Margaret Thatcher would have coped with Twitter. And so, I mean, she probably would have ignored it, but it does make things highly, much more sensitive and pressurized. If you're literally having to work and think on a 247 basis. It's not even 24 7, it's however many seconds in an hour. I mean, every single second, you're thinking, okay, what's, what's. What are they saying? What's happening? And you saw that in the. In the general election. I mean, when Rishi Sunak came back from D day, which was a catastrophic blunder, the reason why that was amplified was because of social media. And so he had to apologize the next day. Without social media, he probably wouldn't have issued an apology. I mean, who knows what would have happened. But it wouldn't, it wouldn't have been as an intense a moment, I don't think.

Yeah. Okay, so there's a couple of threads I want to pick up on. I want to go back to what your goal and your intention was.

Yeah.

By reducing taxes. Because I don't mind saying this publicly, I was very supportive of what you and Liz were trying to do and because I could see, I could see that that would encourage someone like me to grow and hire more staff.

And so basically the basic intuition of this is if you look around the world, countries that grow fast, be they in Southeast Asia, United States, across the world, have generally lower taxes. The Baltic states, Estonia, places you've got.

More money to reinvest into growth.

Yeah, yeah, they've got lower because there's more incentives.

Yeah.

You know, if you're paying, let's say 60 income tax, your incentive to earn.

An income, it's not very good.

It's not very working.

60 of your working life for the government.

Exactly. So who's going to do that?

And if your roads are screwed and the police is not great, then what?

You know, you're essentially incentivized not to be an entrepreneur, whereas if you're paying 20% and you get to keep 80%, the incentive is great. It's that simple.

Yeah.

And so what we were trying to.

Do, it was that simple idea.

It is that simple. It is that simple is to go from a high tax country to a low tax country. And the issue we had was the timing and the speed of the execution. But the vision I still hold and I think in the end we will get there. We are not going to keep putting up taxes indefinitely. People will at some point, surely, surely.

Enough for as long as labor are in power. That's never going to happen.

Yeah. So the problem.

Labor aren't going to bring taxes down.

Yeah. The problem that I had looking back with what we were doing and even at the time people were discussing this, is that you can't reduce taxes without showing how you're going to reduce spending because it's the tax revenue that pays for the spending. So you can't say, okay, we're going to keep spending the same and then say, oh, but we're going to cut taxes. And that's the bit that the market wasn't convinced by. And there were other reasons as well. So. So I think if you come up with a tax cutting plan, you have to show some willingness to restrain spending.

Can'T you also show where you think the extra economic growth is going to come from? From the.

We can do that, we can do that. But I think that initially the market just doesn't believe. And that was the sadness. I mean, her intuition was that, you know, as far as Covid was concerned, the market didn't care. We were spending so much money. So if we're spending money to reduce the tax burdens, what's the issue with that? But I think the market wanted to see some, and we were a conservative government, we've got to show some restraint on spending. And that's the problem I have with Rachel Reeves. It's not the spending bit. She's going to try and reduce spending. That's where this winter fuel payment, I mean, it was a daft thing to do. But there are ways you can reduce spending. I get what she's trying to do, but she's going to put up tax as well, which to me is just crazy. I want to reduce spending and reduce taxes so that people can invest and lead their lives and keep more of what they earn. It seems to me that she wants to reduce spending while also increasing taxes. And I think that's just a double squeeze. And that's what I don't. I don't trust labor on. I never have. That's why I was a conservative politician. But I think they're going to run into this problem and the danger isn't what happens in the next few months. The danger is that if for whatever reason they don't get growth in two or three years time, the tax ratchet will just go up and up and up.

How are they going to get growth? If they're reducing taxes and increasing spending, how are they going to get growth?

Yeah, they're increasing taxes. Yeah, they're increasing. So. So what I think the plan is.

Sorry, did I say that the wrong way?

They're increasing taxes, they're increasing taxes. And so what they're going to do, I think they've got these various big quangos and, you know, GB Energy and all that sort of stuff. And they're going to use the taxes they get to spend on, I don't know, infrastructure, this, that. The other one thing they have done that is good is planning reform. We could never get that through. But I think, you know, we've got to stop that.

No, so I think an economist told me the banks sort of kick out all the housing ministers because they. The banks don't want to load a house building, do they?

No, but I think the problem we had was we've got strong. And, you know, I represented a constituency where people were very skeptical about building. The issue with house building is that you've got lots of Conservative mps in areas where people are very skeptical about new build. You know, they've got lovely fields, they've got a lovely environment and they say, you know what? I. We don't want building here. Nimby, not in my backyard.

Yeah.

And that Nimbyism is quite common and a lot of those NIMBYs are in conservative areas. So Conservative governments have always struggled to get planning reform because a lot of backbenchers, you know, live representing beautiful areas.

Yeah.

Say, no, we don't want beautiful fields, you know, concreted over with. With, with flats. We don't want that. And so successive Tory chances.

Why didn't they reduce immigration?

That is a killer question, that is. And we could talk about that. So that. And again, I think a lot of the official thinking quite likes immigration because it boosts the gdp. They never measure GDP per head, it's just a gdp. So, you know, just to take that forward, if you had 100 million people in England, the GDP, guess what, would be huge. You know, it's crazy, right? But the, but the, their models never look at the GDP per capita, which.

Is surely really important.

Which is the important thing. Yeah.

Because that's how productive each, each person is.

You know, you brought in, you know, 20 million people from China. Yeah. The GDP would go through the roof.

Yeah.

But it wouldn't necessarily help everyone individually at all. And then you've got all the infrastructure that you need to deal with. You've got the schooling places, you've got roads. And that's why immigration is such a sensitive issue. It's because it affects every public service, it affects the demand for houses, it affects the demand for schooling.

Of course, the nhs.

Yeah. Which is already. And that's why it's such an important issue. Rightly. And I'm a son of immigrants. My parents came in the early 60s, 60 years ago, and the average was something like then, probably about 30,000 a year, maybe.

What is it now?

745,000 last. So it's a totally different order. Right.

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I think it's too much.

Yeah.

It's, it's, it's too much. I mean, in the 80s, so you had the first wave of immigrants from the Second World War, the Commonwealth and all of that. In the 80s we had net immigration out of England, out of Britain.

Wow.

So for, for, so some periods of.

The 80s, we might soon, if the country keeps going.

You wouldn't believe it. You know, the population was incredibly stable and again, you know, you and I are similar age. At school, we were taught the population of the UK was 55 million. That was the number. And, and we all remember it never really changed for 20, 25 years, it never changed. Now I reckon the number's about 60, so. And no one really knows because there's a lot of people who are not in the system. You know, they're working in, you know, car washes or wherever, but they're in the shadows. They don't have National Insurance cards or numbers or anything like that. They didn't even have passports, some of them. So there's probably about, I'd say about a million, maybe 2 million people. I can't, obviously we don't know the figure who aren't in the system. So that whatever the population figure they say is probably 1 or 2 million lower than the reality.

Wow. I want to loop back to something else you said. Do you think, And I'm torn on this, but part of me thinks four years isn't enough. You know the term that you get. Yeah, I know you can obviously stay.

Longer, but five years is the maximum.

Yeah. It feels like you need 10 years.

Yeah.

To really bed in, have a long term vision.

So the way the system works or should work. And again, I'm looking back at my experience. So we had Thatcher major, that was 18 years of Tories, and then that was followed by 13 years of Labor. So for 30 years we basically had two parties who divided roughly half and half.

So they had their 10 years plus.

They did, they did. I think now the electorate is much more volatile. I think people don't vote tribally, which is probably a good thing, but it does mean that they can turn on you. And so when, you know, the day after the election, people say the Tories are out for 10 years. And I'm like, after two months of this labor, I can't see them lasting 10 years.

Do you think they're messing it up?

Yeah, I mean, you look at, I mean. Well, I get what they're trying to do. They're trying to get everything done. Controversial at the beginning, bed in and then hopefully things come. Right. But they've, you know, in two months you've had, obviously the riots, but that came out of the blue. But you've had this union wage settlement. You've got this winter fuel payment. They let out what, 5,000 prisoners or they're gonna let out, you know, in two months, all of these. This is in two months time they've done this. And I'm thinking, don't we all already.

Have quite a crime issue in the uk, a lack of conviction?

I think that the, there were ways you could deal with that. And they say, oh, well, it was a Tory's fault, but they didn't. No one said, again, it's a choice. Oh, we're gonna let out. I think they're Gonna let out 5,000 in September and October. So this month and next month, by the end of next month, they'll have let up 5,000 prisoners at the same.

Time, putting people in prison for social media posts.

Exactly.

I'm not saying that they were not.

No, no, no, no, no. Exactly right. Yeah, exactly right. And you've got. And, and what's going to happen? And I'm sure the, you know, the tabloids will get onto this within about three or four months. Some of these people who've been let out will end up doing terrible things.

Of course they will.

And the victims of those people will blame the government.

Well, the victims weren't. Weren't even told, apparently.

Of course not. So, but they've. These are decisions they've made in two months. I mean, the election, when was it? July 4th. And we're now in September. I mean, it was, you know, and so they've done all of this in two months. And I'm thinking if they carry on like this, that they won't get reelected. I mean, I don't know what the next government will be, but those guys aren't. Aren't going to come back. And if they do come back, it'll be a much smaller majority or it'll be some sort of coalition.

Right.

That they end up in.

So I was in this same room just a couple of weeks ago with Dan Wootton.

Oh, he's a good man.

And Dan is bullish on Nigel being prime minister in 2029.

Fascinating. I. I get on with Nigel. He's a. Someone I regard as a friend. I go on his show, but I think he's done something which is really naughty. And that's what.

That's naughty good or naughty bad?

Because I think this labor government is fundamentally not very popular. Okay. They only got what, 34%, 35% of the vote, which is a lower score than any government I think, ever. But what gave them a huge majority was Nigel's Reform Party. And yes, Sunak had a terrible campaign and Nigel did his thing. But my frustration with it is that I know because I know all these people. I know I was a colleague of many MPs, hardworking people, good people. And they lost. And they are as sound conservative, right wing, whatever you want to call it, as Nigel is, they're not socialists. They're anti woke. You know, I mentioned people like Richard Drax in South Dorset. He lost by, I think, a thousand. And Reform, forgive me, Freud and SIP reform got 8,000 votes. So the labor guy gets 15,000 votes. Let's say the conservative gets 14,000 and reform gets 8,000. And you're not telling me that if Reform hadn't, this guy wouldn't have got in. And I said to. I actually said that to Nigel. I said, you know, a lot of very good conservatives, people who share your values, who are, you know, care about our country, who care about our history, who are anti woke, lost their seats because of reform candidates. And that's the problem that the Conservatives will face.

Why was that naughty of Nigel though, if he's got his own political ambitions?

Because essentially what you're doing is you're giving Labor A huge. I mean, I'm being flippant, saying naughty, but it's frustrating because. Because you're essentially giving Labor a totally inflated majority.

But Conservatives had their chance.

Yeah. No, you, you can say the Conservatives were bloody awful and they did this to themselves. And that's what Nigel says. Nigel basically says the Tories did this to themselves. They killed themselves. They were bloody awful. But I would say to him, however awful the Tories were, you've got a left wing government that they don't agree with anything that Nigel says, they're the complete opposite. And because of what Nigel did, he's empowered them to do whatever the hell they want. They've got a majority of 179, which they wouldn't have had if reform wasn't there. So.

But do you think he's going to make a play to. Maybe.

I think reform could do well, yeah. But I don't. You know, the problem is, and I always talk about the past because I'm a historian and I. A lot of my politics reflects the fact, the time I grew up in. So one of the things that happened in my lifetime was the SDP and Labor and in 1983, the Tories got a massive majority because the left essentially. Well, lots of reasons. Thatcher was popular, the Falklands, all of those things. But one factor that's often overlooked is that the left were split. So you had the SDP and then the Labour Party and it took them 14 years after Thatcher, after 83, they only got into power in 97 because they were split. They had to do all sorts of things to get rid. To get into government. The danger, and I don't think we'll be out as long as this, but the danger is that with reform and the Conservatives, you've got a broad sort of center right family that is at war with each other and allows the Labour Party to be unopposed. And that's a real threat.

Do you think Conservatives lost their identity? Nigel said to me, they don't have a brand anymore.

Yeah.

Do you think maybe they lost that?

I think there's a. I think there's a good. So the issue. And I came in in 2010 with David Cameron, we had five prime ministers.

Because he's supposed to. Conservatives are supposed to be low tax.

Yeah, yeah. And then we. Yeah, yeah. So. So. And I've had this conversation with Nigel and other people, you know, and people in my constituency, they're Conservatives, but a lot of them voted reform. We still won in Spelthorn, which is good. And we've got A great new MP called Lincoln Job. But there were a lot of my voters who voted reform this time, people who voted for me who voted reform. And I speak to a few of them, you know, in the pub and other places, and they were saying to me, well, look, you know, we like you, you know, we've got a personal friendship, whatever. But if you look at the Conservatives, you know, we are low tax people and you put up taxes. We are loaner immigration people and you've whacked up immigration. We are personal liberty people and you want to ban smoking. You know, all of these things. It's like, so why would we vote for you? You know, we are strong defense people and you've cut the armed forces, so why should we vote Conservative? And I, you know, try and make the case. There are lots of cases to vote Conservative, but I can see why, given what happened, they will look elsewhere. But my worry is that, you know, reform can do well, but they're a long, long way from government. They've only got five MPs and you've got, and they've eliminated through their actions a whole, you know, dozens of very good Conservative MPs, which, who would have held this labor government to account.

So what do you think is going to happen in this budget that's coming up then?

So I think, I mean, it's a fascinating situation.

I like the choice of word fascinating. Well, it's, I think I'm not fascinating.

It's depressing as well. So I think what they're going to do, they're definitely going to put up tax, but the way that they've crafted it is we're going to hit you very, very hard. The taxes are going to be really, really, really, really difficult. And then in the event, they'll just hit you a little bit and we're half. You get the taxes getting raised. Do you know what I mean? They're softening the ground, they're preparing the ground. And I think tax rises are inevitable. And I think, you know, the, the as people will be grateful for the fact that they didn't tax us to the Hill. That's what, that's how they're framing this. That's, that's what I think is going to happen.

Okay, and then how do you think the next few years looks under Labor?

Look, you know, I'm a, I'm a British patriot. I want the country to do as well as possible. My fear and my expectation, frankly, is that they're not going to get the growth they want. And if they don't get growth and you've got public expenditure going up very fast, high. You're going to try and tax. Get tax revenues to pay for it. And the way to do that if you don't have growth is just to hike up taxes. Because what growth does. And we did the analogy of the House and we talked about after the war and stuff, if you're growing your income and growing your wealth, you know, debt becomes quite manageable because it's a fixed rate, you pay interest on it. But if your income is going up very fast, you can handle that. If, however, your income isn't going up and the debt is there and you're trying to pay interest on it, everything becomes much harder. And as a country, I think that's my fear for the next two or three years, essentially, we get stuck with quite low growth rates. Public expenditure is going up very high and we will simply try and raise taxes. And the thing as you've identified is that if you raise taxes, you're killing off incentives. So that's the doom loop. So the more. The less you grow, the more you have to raise taxes. And the more you raise taxes, the less you grow. So it's this vicious cycle. And that's where I think we could be.

Wow. Because if I look at what's going on in Dubai, which seems to be run at the top by entrepreneurial people, lots of people I know from the UK have gone there.

Yeah.

Of course it's expensive there, but the taxes are very much lower. And this seems to be a major campaign for entrepreneurship.

Definitely. So the thing there.

Can we not look at that model? We could. Saudi and Dubai were built essentially by entrepreneurial kings.

Sure. But a. They're quite autocratic. True. And. And as a consequence of that. So they have votes. Right. So, yeah, you don't have to worry and inverted commas about actually what people think. And because we've had democracy for such a long time and it's a European thing, it's not just about Britain, we've basically built up a huge social net, a welfare state that many people, including myself, would want to kind of restrain because we. Which we can't afford. Which we cannot afford.

How much are we spending on welfare?

So the, the total budget. Get this. Right. So when I was first an MP, it was 700 billion. And then by the time I was Chancellor, this was about 10 years later, 11 years later, we were spending a trillion pounds. And I remember thinking, on welfare. No, not on welfare. So the welfare bill. The welfare bill was about. Is about 20%. 20, 25% about. Of that. That's massive. It's huge. It's huge.

Why do we not invest? Do you know what? Like, just as an aside here. So I got. I got decent following on social media and I just walk around my streets of Peterborough sometimes, just talking to people, you know, people on the streets.

Yeah.

And they literally sit down and say to me, there's no point going back to work because I can earn more begging on the streets. And they're professional begging somewhere in 150 a day, 200 a day, 300 a day. Not. Not even exaggeration. They've got their own house.

No.

And they don't see the point in going back to work, but I'm sure they want to.

But their incentives are all wrong.

Yeah.

And that, going back to your Dubai point, they don't have that in. They don't have a welfare state in Dubai, essentially. I mean, they've got bits and pieces of it, but not to the same degree as Western countries.

So people just end up having to find a job. They have no choice.

That's right. That's right. And then they keep more of what they earn. Whereas we built this huge welfare state that needs. And it's not just so. So that. So when I'm looking at the budget, I'm thinking, let's say it's a trillion. It's more than that now, but two years ago it was roughly a trillion pounds, which is astronomical. And about 20% of that was welfare. The National Health service is about 20% as well. And then you've got all the other things. And the problem is that the.

Well, the interest on debt is quite.

The interest on debt is about, let's say, 100 billion. I mean, these are all rough figures.

That's not even paying the debt off, is it? That's just the interest.

That's just the interest. We're not going to pay the debt off. And so we've built this system over decades, which we can barely afford. And I would. I would question. I would suggest we can't afford it.

So does. So what's the. Because some people call fiat currency.

Yeah.

A Ponzi scheme.

Yeah. So we've been printing money. We've basically been. And this is one of my favorite areas, actually. Until 1971, the world was on some sort of gold standard. Since 1971, the last 50 years, we've basically allowed central banks, governments, if you will, to print paper money.

Yeah.

And that is. It's like the heroin hit. Do you know what I mean, if you're in trouble.

But people don't understand every time there's the heroin hit, that's essentially a tax on all of our money.

It is. And also it, it leads to currency depreciation. It leads to less stability and a much more uncertain world. And actually the people who benefit from it are people who have assets. So.

Yeah, I mean, it pushes the value of.

Exactly. Exactly.

Asset up and the debt down.

Yeah. I mean, what a lot of people don't know is like. Yeah. You know, you all probably at school read about the. Or saw the hyperinflation in Germany in the 20s. Now, a lot of people, not a lot, but some people made a lot of money in that because they had farms. Yeah. They had assets. Yeah, they had assets. Yeah, yeah. And they had, they borrowed. They borrowed money, they bought assets.

That's why the rich get richer. The rich have assets.

Yeah. And the inflation just wiped out the, the, the debt.

Yeah.

And the house at the end of the day is still a house. A field is still a field and a cow is still a cow.

And whatever mortgages on it all is virtually nothing.

Yeah, exactly. Right. So people still made money from that. And actually what we've seen over the last 15 years, certainly since 2008 and the financial crisis, there has been massive pumping, pump priming, very low interest rates, flood of money that's pushed up asset prices. And so if you had assets, happy days. But if you didn't have them, it got more and more expensive in the currency you were, you were earning to buy those assets. So that's where you get disparities.

Yes.

Greater disparities, as you say, between wealthy and poorer people.

Yeah. Because unfortunately, it pushes the price of houses up. I own 345 properties, so it's good for me.

Yeah, it's great.

But I have deep sympathy for people whose wages are going up nowhere near with house prices.

Yeah. And it's a real problem. And the, the other issue with it is that you've got generational disparities. So. And this, I think, is at the back of labor's minds, they think old people are rich, you know, which is nonsense.

Yeah.

But you do have some people of that generation who, you know, have worked hard and have paid off their mortgages and they have houses that are considerable value. And then you and I will know people who are 35, even 40, who've never bought a property, they can't afford one because they can't afford one. And they're actually doing, quote, good jobs, but they've never managed to be able to scrape together a deposit to, to pay for this.

Well Also I remember 15, 20 years ago in the, in England, one of the foundations of you becoming successful was to own your own home.

Sure.

And now so many people are like anti owning homes. There's big influencers and even wealthy people. You shouldn't own a home. It's a liability, it's a debt trap.

That's right. So, so a lot of, I mean just to be fair, I think a lot of this is, is cyclical. So before the Second World War people used to rent a lot more than they, they do, they did 20 years ago and they even, they do now. But you're quite right. I think the maximum of home ownership was probably about 2002, 2003. I'm sure one of your. But it's certainly going down. It's not, it hasn't gone up. And I think this, these asset bubbles are a big part of that. You know, houses. I remember as an mp, you know, the house prices went up hugely in my constituency. So a three bedroom house in a place like Stanwell, in about 2010 people will know where Stanwell is, but it's a suburb of Staines essentially. It was just near Staines would have cost about 180 grand in 2010. I can see that right now. Now it's probably doubled.

Yeah.

In 14 years. And these are, you know, modest family houses. They're not, they're not anything lavish, they're big that, you know, people are comfortably off who are in them. But you know, for that to double. So your ability to buy a house like that if you're borrowing and you know is, is, is really difficult compared to what it was 10 years ago, 12 years ago. And I think that's a big problem.

I'd love to talk about the future of fiat currency because I wrote a book called Money and I studied the history of money.

It's fascinating.

Many. It is fascinating. And what people don't understand, I think people assume money, cash money, fiat currency, it's always been here and it always will be him. Not at all. Cash is a relatively new phenomenon. If you look through history and we've traded virtually everything as money, surely at some point maybe it started the death of cash and something replaces it.

So I think something already has almost replaced it, but it's only beginning. It's in its infancy, cryptocurrencies. I mean, I don't think the phenomenon of cryptocurrencies would have emerged without fiat currency.

No. Because it wouldn't have had a problem.

Exactly.

Because the fundamental concept of bitcoin, limited supply.

Exactly, exactly.

That's the opposite.

Exactly right. So Bitcoin is almost like trying to be a sort of gold standard or a current commodity standard in terms of the limitations of supply. Whereas, as you say, with fiat currency, there's an infinite. They just have to print the press. Right. And the stuff rolls out. And actually one of the things, I wrote a short piece about it a few months ago, a guy called John Law, and he was a Scotsman who essentially, through lots of different ways became buys and means, became Prime Minister of France. And he had a scheme and they'd worked out paper money 300 years ago. And he basically, you know, he had this bank in France and they had fiat money and he had, he literally had printers, eight printers that were working night and day to print out these, these currencies, this paper money. And of course the whole thing came down and the stock market of the company he set up, the share price crashed. And there's, that's an intrinsic risk in fiat money because there's no restraint, there's no natural restraint to the printing of currency. Now, I don't know where that leads in the west. And you've got bankers who are trying to manage the system.

Do you fear a central digital currency?

Not really. I mean, the problem is.

Or do you fear a cashless society?

I don't fear a cashless society, but I think you need to have stores of value. Maybe crypto is, or some form of crypto and balancing it.

Why don't you fear a cashless society? Because if there's no cash, then everything's automated. Can't they just do whatever they want?

So I, I, I don't think they can. If you've got different sort, if you've got different cryptocurrencies, you know, I think you could, you could have a world where we didn't actually have cash and everything was, was wired.

So you think there might be some free market, fair competition?

Yeah, there could be. Look, so cash, which is a function of history as well, you know, if they, if they had wireless transfer in, you know, 1200, they probably would have done that.

Yeah.

You know, they were limited by their technology, by how they could do transactions.

But wireless transfer is different from a cashless society in a central bank, digital currency.

Okay.

Because, you know, big banks like to swallow up and wipe out little banks.

Yeah, they do history. They do, they do, they do, they do. But I think some sort of competition. So you had a Thing called free banking, you know, before the Federal Reserve, basically, in the us and you could envisage a world where there was competition amongst different banks, amongst different currencies. The problem with that is that some would go down and then of course the people who lost their money would complain to the government and that's where the regulation comes in. But it's not impossible to imagine a world where you have, you know, transfers, digital currencies competing. Maybe it's not, it's not beyond the realms of imagination.

No, I think it was probably going to happen. I just fear the control. I, I don't.

But if you've got lots of different centers, you know, if you've got that. That's right, that's right. So you, you know, you've got to.

Sort of, you know, RBs. How many banks they actually own?

They own dozens. Yeah, so.

So you think there's all these decentralized banks and actually they're all owned by one group. You go into the supermarket and you think you've got all these brands and they're all owned by Unilever and Nestle.

And that's been happening for probably more than 100 years. So if you looked at the high street 100 years ago, there'd be tons of different banks. Tons of different banks.

And then when I feel is good for competition.

Yeah, it was. But then, but then, but then what happens with competition is that the big bank wins and especially if you've got.

A big bank, you're happy.

Exactly. But then you've got to split them up again.

Yeah.

And actually the, the. So what you've got to do is you've got to make it easier for banks to come in. I mean, that's why, you know, I liked things like Metro bank and Monzo and, and start all of these banks. I think that's good. It's good to have healthy competition because, you know, back in the day we had four banks, you know, the Midland, NatWest, Lloyds, I can't remember the other one. And Barclay. Barclays, yeah. And that was it. They, they, they had 90% of the market. You know, the, the banks used to shut at 3:30. Do you remember that? In the afternoon it wouldn't be open on the weekends. Yeah. You know, it was all very kind of monolithic.

Yeah.

And of course you've got to have more competition, but I'm not. I think cash itself is something that probably will in the end disappear because, you know, we've got different technology. You know, cash itself was, you know, back Way back when was very sophisticated technology because people used to have actual currencies and gold and silver and then say, oh, we got paper notes. How sophisticated is that? Yeah, but things evolve and then that's not sophisticated anymore. We've got other ways of conducting transactions, so.

I'm aware. On your time.

Yeah, it's a shame. I mean, I wish we'd had longer and if I'd known that you were so free flowing, I would have definitely booked out because we can talk forever.

Yeah, that's fine.

A lot of these fundamental issues and.

Maybe we will in the future.

We will. I hope so.

Yes.

I'd love to come back and talk about paper currency, fiat currency.

I'd love to.

The gold standard money. Because I didn't know what your drift was. I mean, I assumed we were going to obviously talk about politics, but I'm very interested that you've got a strong interest, as I do, in the history of money and currency.

Okay, so let's do a quick fire round to finish then because you've still got a few minutes from what you said. So we do the quick fire round at the end of the show every time. It's called the disruptors round. What's a story you've never shared or a secret you've never told?

I'm trying to think. I mean, you know, having been a politician, everything is out there.

There's always something.

I'm just trying to think. Probably something about my university days like breaking windows and throwing things through them, but I don't want to go there.

You gonna give us something?

I think I threw a bottle through a window once, a full bottle of wine. But that.

Is that not a rite of passage for going to university though?

I felt a little bit guilty. It was actually ended. It was a friend's room. Anyway, I don't feel, I don't. I feel a bit guilty about that, but it was a long time ago.

Okay. What's the biggest disruption that's ever happened in your life?

Well, being sacked from being Chancellor of the Exchequer after 36 days or whatever it was. 38 days. That was quite a. That was quite something.

Did you think you'd be in for a few years?

No, actually, because we, we were facing a general election whether we liked it or not, within two years, which even then seemed likely that we were probably going to lose it. But at the same time it was a very quick, it was a very sharp exit. I never felt secure in the job because I did the whole thing. The pace at which we went, we went about things was in itself slightly unsettling and unstable.

What's the biggest risk you've ever taken?

The biggest risk, I think anyone who goes into politics, into stands for Parliament, sort of financial risk, but it's very uncertain. You might not even get elected, you might only even get selected, and then you might just do one term. Some people I know who had the safest seats, someone like Michael Gove had one of the safest seats. He left and we lost the seat. Dominic Raab was the same. So in politics it's very uncertain. Lots of chance events, lots of, you know, even Brexit itself, you know, who predicted that? So it's, it's turbulent and, and, and uncertain. So I think anyone who embarks on a career as an MP is, Is taking a risk.

What's your most brutal life lesson?

I think you've got to be very, very resilient. I mean, that sounds like a cliche, but I think, I mean, there's the old cliche. Nothing is as bad as it seems, nothing is as good as it seems. So being able to keep an equal temper, whatever goes on, is really, really hard. But actually I think it's the most useful lesson. And of course, we're woke. So we don't quote Kipling anymore. He's been cancelled. But that's. We're not allowed to refer to him. But, but he wrote that poem if. And I keep reading that, and there's so much to be said for it, you know, if you can keep your head and all of that sort of stuff. And I know it's associated with empire and colonial. All of that stuff, colonial oppression and all of that, but actually it's a very good poem. And I think in politics, in business, in lots of walks of life, being able to keep an even temper when things are going crazy.

Because it could be crazy good as well as crazy.

Exactly, exactly. And he says, he says that line where he says, you've gotta. You gotta triumphant disaster. You've got to treat those two imposters just the same. You know, that's a really hard thing to do, and I don't think anyone can quite get there, but it's an aspiration. I think it's a really good way to be because otherwise. The thing is, when you panic, you don't think straight. It impairs your ability to think through problems. And that's why you've got to try and keep an even. An even temper. Very, very hard to do. Easier said than done.

What's the most disruptive thing anyone's ever said or done to you.

People say that all the time on the street. I mean, you know, especially after I left, the chances, like you buggered up my mortgage. I said, oh, thank you. Of course, that's what really annoys me. It's like they fixed it. They chose to do the deal, you know, for two years or three. You know, that's their choice. But of course, if it goes wrong, then they have to blame whoever it is. And I get that there's frustration and anger and all those things. And I think if you're in the public eye, you know, and I use the Tube, I've. I'm a Londoner and I've used the Tube probably every day of my life since I was about 12 or most days. And so I. I haven't changed that. And actually, some people are very nice and charming if they recognize me. Most people don't know who I am. And people come up to me and go, you're that guy on BBC, are you? And I went, yeah. And one charming man said, you look like the man who used to be Chancellor the Exchequer. I just said, yeah, for you. But. But no, so. So you.

And actually, they're not referring to Trevor MacDonald.

Maybe they've got some resemblance. They've got to be of a certain age. Of course, no one under 50, really, of 40, 40 knows who Trevor McDonald is. But. But yeah, that's. And actually, it's funny because I met. I bumped into Alistair Campbell on the tube and he's one person, you know, love him or loathe him, he knows what it's like because he's like me. He uses the tube, He's a public person who's not afraid of being in the. In public. Literally.

You know, you're not afraid because there was some. Quite a few stabbings of MPs.

Yeah. I mean, one does think about that. I mean, the appalling thing about that was that they were doing their job as MPs.

Yeah.

At surgeries, which they'd advertised and I'd stopped that in 2014. So generally, you've got a constituency office and I would have my surgeries there.

Yeah.

But we would vet the people who came in. We check they had an address, which. But if you do what are called mobile surgeries, you'll say, I'll be at a Tesco on Acacia Avenue, you know, at 3pm on a Friday, and you tweet it, anyone can see.

But I know one politician who we both know.

Yeah.

Who has 10 people in his security detail. Now, and two of them just monitoring social media the whole time.

Yeah, no, I could see that. And I know, I think it is. It's mental and it's really sad.

It is.

And actually, 30, 40 years ago, it wasn't a thing. I mean, you had the ira, so that was different. But. But the man that I so fond of was Sir David Amos.

Right.

I didn't know him brilliantly, but we were friendly. You know, he's someone you'd always be happy to see and bump into the tea room or the corridors. And what he did was he tweeted the fact that he was going to have a surgery in a church in his constituency and his assailant, his murderer, saw the. The tweet and then, you know, spent 10 quid or whatever it was on a train from God knows where, Kilburn somewhere, to Southend and attacked and killed him.

That is so sad.

It's. It's. It's beyond sad. It's tragic. And, you know, he's beautiful family. I went to the service in Westminster Cathedral and, you know, he had his four. I think he's got four or five children, I think, anyway, four or five, lots of children, and they were all there with their mother. I mean, it was. It was. It was heartbreaking.

And you still get the tube.

Yeah, I do. I mean, I think. Yeah, I. I don't think. I don't. I've never felt unsafe. People say think the old thing, but I've never. I think the issue with David was that he advertised where he was going to be and that tweet, I think, had lasted for about a week. And, you know, and it's. I don't like talking about it, but it's the fact that if you, as a public figure, say you're going to be in such and such a place in a week's time, there is inherent risk there. Whereas if you're just popping around the Tube and that you're not advertising where you are.

Yeah. A week's a long time for someone to prepare.

Exactly. So that, you know, one, it can be exposed to random attacks. But if, you know, if you say where you are a week in advance, you know, there is always, I'm afraid these days, the possibility that, you know, very bad people will act on there.

What's the best advice you remember receiving?

I think the best advice I remember was probably political advice, but, like 20 years ago, and people said, you know, you've always got to be. You've always got to have a life outside politics, whatever that is. And I think you could apply that to other professions. You mustn't let whatever you're doing just totally consume your mind. And that's what I do for business.

So maybe I need to listen to this.

Is that what you do? Because then again it's that thing where you just need a bit of perspective though. Yeah. It can be all consuming but you somehow you've got to. And it's different personality types have respond to this differently but you've always got to try and look at yourself critically and if you're not, if you're just objectively. Objectively no one can have full objectivity.

We are, we are.

Yeah, exactly. So you can never. And you learn that if you know anyone who's studying history at school, university, the historian cannot ever be fully objective.

No.

Because they've got their.

You can have high or relative.

Exactly. You can assign your flaws exactly. You can aspire to it. It's like an athlete you're never going to be run the perfect race but you can always aspire to getting better. And I think you've got to have self awareness. I think we've all got to work on, on that you see yourself how others see you. All those cliches. There's a reason why people say that, you know, you've got to, you've got to. And I think generally successful people, I mean there are some exceptions but generally succession people are very self aware.

And what about the worst advice you remember receiving?

Oh, I can't remember. I mean so again probably something in politics. Maybe it was something, you know, in 2010. Oh yeah, you know. Oh yeah. You know you've got to back remain because you know that's going to win and your career will be finished. If you. Something like that.

What would you say is your biggest regret?

My biggest regret I think has to do with my very brief period regrettably in as Chancellor Isheka I think we should have taken a much more deliberative, slower approach to what the strategic goal was. I think trying to do everything at once in life is generally a bad idea and I can see, I've thought about it a lot. The reason why politicians do it is because you're living in a 247 social media culture. So the, the pressure is always to do something, get a grip. But actually sometimes you need to think more deliberatively about what it is, what your strategy is, what your end goal is and then work systematically to get there. Because if you try and do everything at once, it's like speed you Know, if you, if you're driving a car 150 miles an hour, there's more inherent risk in that than if you're driving it at 40 miles an hour. That's why we have speed limits. So the concept of doing things very fast is allied to risk, greater risk. And that's something I've thought about a lot in life, obviously since leaving office.

Do you think the Prime Minister actually has full leadership of the country or are there other people that are more powerful that I think it's influenced?

So my big idea, and again, I've thought about this a lot, as you say, because that was my profession is what has been my profession. I think basically the Prime Minister today is a totally different animal to what it was even 30 years ago, let alone 100 years ago. I think 100 years ago, you know, we read about the great prime ministers and they were kind of driving their own agenda and they had a lot of power. Now you've got all sorts of institutions. You know, you've got quangos, you've got institutions, you've got regulators, you've got judges who are much more empowered than they ever have been.

Could you just define a quango in case someone doesn't.

So quango is like, it's called, it's a, it's a quasi non governmental authority. You know, quango is something like offgem that regulates, and I used to work with them a lot, the energy sector or the electricity sector or another quango would be, you know, things like, you know, I'm trying to think of, you know, the securities fsa, you know, that regulates the financial services. Yeah, the FCA Financial Conduct Authority. But then we had an FSA before that. Yeah. And then we've got, you know, the bank of England, which is sort of not really a quango, but it's an institution that's outside government.

But obviously response had some power over you, didn't it?

The bank of England? Certainly, certainly, certainly. I mean, even though I know Bailey, Andrew Bailey, the Governor, I mean they, they, they, they, some people would say they did a number on us, but you know, I think a lot of that was self inflicted, but we can talk about that. And there are lots of these institutions that are unelect, are run by unelected officials, by people who have a lot of power and nobody knows who they are. And so a modern Prime Minister is dealing with what I would call the administrative state. There are officials, there are these, we call them quango crats, people running these institutions that aren't remotely electable or elected or get accountable to the electorate. You've got a whole bunch of think tanks, you've got a whole bunch of people in the public service generally and they all have huge influence. And a prime minister today is almost in many ways like a mid level bureaucrat who's swimming in this tide. And we read about the great prime ministers, Churchill, Israeli, whatever, whoever your hero is. And they had much more freedom of action because there were a few of them.

So we don't have the environment to have a leader like that anymore then.

I don't, I think, I think the media environment and the broader bureau bureaucracy which I'm talking about, you know, the officials, the quangos, as I mentioned, the different institutions that run by people who are earning lots of money, who you've never heard of, all of that means that what a prime minister can actually do, I think is more constrained than ever before.

Wow.

Wow.

And this show is called Disruptors. Final question. What does disruptive mean to you?

I think you've got to. It's like breaking the mold. It's like breaking, you know, patterns of behavior and thought that have dominated and constrained people for decades. I think disruption is really, really, you won't get progress without disruption because people would just stick around doing exactly what, you know, they've done for ages. And I was used to laughter, you know, with my civil servants and officials. You know, if, if we weren't disrupted, we'd still be in caves, we'd still, you know, the Stone Age would never have ended. But people, because people decided, actually, no, we're not going to live like this. We're going to try this. We're trying to get out the cave and do something and see something. That's how progress happens. Because if we just end up doing the same thing forever, you know, we just have a monolithic, stale civilization, if we can, if we could even call it that.

And are you active anywhere on social media or do you engage in any discussion?

Keep. I do a lot of media, actual media, so I do, I go on TV programs. I love talking about politics. Love going on Nigel's, Nigel Farada show, open debate, love all of that social media. I'm less active because you get into these rabbit holes and fights and you know, I, I'm not into that. I don't want to have, you know, like Johnny Mercer, my old friend and mp, you know, he used to have these spats with Carol Vorderman that lasted forever and they were just calling each other.

She tried to cancel you.

She tried to counsel me. She said, why is he on GMB News? I'm like, well, gmb, not GMB News, GB News, gmb. Why is he on gmb? And I'm like, you know, this man wrecked the economy, he shouldn't be. I mean, what are you talking about? You've got to have a debate, you've got to have open discussion as well as what you're doing.

Yeah.

And there's this element. We never really had this until about five years ago. We didn't had a. We didn't have a council culture five, ten years ago maybe. But I don't know where this thing has crept in where you just basically deny people a platform because they say things you disagree with.

Yeah. That to me, that's fundamentally wrong.

It is fundamentally.

Won't. You won't have progress.

No. And you won't have discussion.

No.

And you won't have growth. I mean, not economic growth. I mean mental intellectual growth.

Yeah.

How can you have that if you just shut down and don't listen to views that you don't agree with?

Do you think it's maybe something to do with? Because I think about this a lot because I think society is an interesting place and I wonder if maybe things have been very good for probably a few decades.

Yes.

You know, imagine if there was a war in our life 20 years ago.

Yeah.

You know, we, there wouldn't be all this entitlement.

No, no.

Do you think maybe just things have been a bit easy? Because when we, when things are easy and comfortable.

Comfortable.

We get distracted. We pick little arguments. You know that saying about good times create weak men, weak men create hard times. Hard times create strong men. Strong men create good times.

Yeah.

And it's cyclical.

Yeah. I think there's an element of truth in that. But I also think that the proliferation of media means you can just listen to people you want to listen to.

And anyone's got an opinion now and.

Anyone'S got an opinion. So if you, if you have crazy ideas about, let's say, the flat earth society, you know, whatever, but there are a whole bunch of guys on the Internet who are just talking to each other and that's their truth.

Yeah.

Whereas, you know, 30, 40 years ago when we didn't have that, you had to engage with, you know, you could say it was mainstream media, you could say it was biased, whatever, but you had to engage with that. Whereas now you can lock yourself up in a room and talk to similarly like minded crazy or not crazy people and then. And, and ignore everything. Else. And I think that can be inherently dangerous. And that's why you've had all these, you know, a proliferation, I would say.

And then they have. Sorry to interrupt. But then also the algorithms feed you.

More with all that stuff.

Yeah.

And you could live a world where essentially you're not listening to any diverse opinions.

Yes.

Or anything that's challenging your worldview and everything you hear and everything you say is just reinforcing whatever, you know, notions you've had. And I think that can be quite dangerous.

Thank you very much for being on the show, Kwazi. I enjoyed it. I had a lot of fun. It's been great to meet you.

Well, at some point in the future, we should talk about fiat currency.

Yes. We'll do a couple of hours on that.

I'd love that. I'd love that. I'd find that very interesting.

Thank you.

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