May 24, 2023 - 4:15pm

“Globalisation, as we once knew it, is dead,” Shadow Chancellor Rachel Reeves said in a major speech in Washington D.C. today. Speaking at the Peterson Institute think tank, the Labour politician set out her party’s vision for Britain’s economy, as well as declaring that “the old model is failing.” 

In the speech, titled “Securonomics”, Reeves argued that “supply chains that prioritise only what is cheapest and fastest struggle when a crisis strikes, be that PPE during Covid or energy following the war in Ukraine”. Talking about the limitations of globalisation, the Shadow Chancellor pointed to “a globalised system [that] can be gamed by countries like China who have undercut and ignored the international trading rules, and made it impossible for our own to compete.”

Speaking to the Financial Times ahead of today’s speech, Reeves said that while Labour’s economic plan must be based on “the rock of fiscal responsibility”, it is in Britain’s interest to move away from Chinese supply chains. “We have allowed the production of critical technologies to slip from our grasp,” she said, “costing us jobs and compromising our security.”

The location of Reeves’s speech was significant, as she suggested that Conservative Party opposition to the Biden administration’s economic model has put a wedge between Britain and the United States in recent years. “In an uncertain world,” she claimed, “we cannot rely on a handful of industries for our economic success, nor can we outsource the supply of critical goods and services to the lowest bidder.”

Reeves pointed to New Labour’s success in “reviving industrial strategy in Britain” in the wake of the 2008 financial crash, and suggested that a government led by Sir Keir Starmer could emulate this policy focus after industry has been “hollowed out” by Rishi Sunak. Should Labour win the next general election, the party would devote itself to “rebuilding the industrial foundations that we have lost and which has left us exposed to global shocks”, she said.

Such a move is necessary, the Shadow Chancellor claimed, in what she termed the “Age of Insecurity”, a period in which three “once in a lifetime events” — the UK’s exit from the European Union, the Covid-19 pandemic and the Ukraine war — have taken place in quick succession since 2016. She singled out China for “unbalancing the old global order of a unipolar world”, and said that “while the old ‘Washington Consensus’ might have been swept away, a new one is emerging.”

Reeves, who has been in her current post since 2021, has become an increasingly influential figure within the Labour Party, topping the New Statesman’s Left Power List ahead of Starmer this month and frequently appearing as one of his most likely successors. She has aimed to win back support from business leaders, and has consistently placed “fiscal discipline” at the heart of her economic doctrine.

As to what can replace “the old hyper-globalisation”, Reeves argued that “a new era of multilateral partnership is emerging in its place”, without the excesses of the former. The transition to Labour’s economic plan, according to the Leeds West MP, can only come about by “accepting that the world has changed and Britain must change with it.”


is UnHerd’s Assistant Editor, Newsroom.

RobLownie