The anti-growth extremist in Burnham’s cabinet

‘When you think that you’ve lost everything’, sang Bob Dylan, ‘you find out that you can always lose a little more.’

Ahead of Andy Burnham announcing his new cabinet, the widely held view among right-thinking people was that nothing was more important than Ed Miliband losing his job at the Department for Energy Security and Net Zero. Surely no one could be worse than this fanatic? Miliband not only lost his job but will now spend much of his time abroad in his new role as UK foreign secretary. Happy days. Alas, those who couldn’t think of anyone worse to be in charge of the nation’s energy supply had forgotten about Miatta Fahnbulleh, former chief executive of the New Economics Foundation and Britain’s new Minister for Energy Security and Net Zero, with the emphasis heavily on ‘Net Zero’.

Fahnbulleh has accused Zack Polanski of stealing her vision of a green economic revolution and she has a point. The economically illiterate, tree-hugging, anti-growth agenda that the New Economics Foundation (NEF) has been pushing for the past 40 years is indistinguishable from that of the current Green Party. Indeed, the NEF sprang out of what was then known as the Ecology Party in the 1980s. For years, it provided a little light relief in the think-tank world, with its happy-clappy focus on ‘wellbeing’ over wealth and its hare-brained policy proposals, such as setting up its own rival to Uber and creating local currencies like the Brixton Pound.

According to the NEF’s Happy Planet Index 2012, Rwanda was a better place to live than Luxembourg, and Costa Rica was the greatest country in the world. How we laughed! The think-tank’s obsession with climate change seemed to be motivated by a perverse desire for the sacrifices it assumed would have to be made. Privation was a feature rather than a bug of its efforts to save the planet. In 2009, it dished out carbon ration books, which limited people to a certain number of showers, baths and toilet flushes per week to get them ready for the future. In 2010, it followed up its book, Growth Isn’t Working, with the sequel, Growth Isn’t Possible. In the same year, it called for a 21-hour working week to help tackle unemployment and ‘over-consumption’ and to ‘help to engineer a “steady-state” economy’.

As the 2010s wore on and the public began to see what an economy without growth actually looked like, the NEF quietly pivoted away from wanting a ‘steady-state economy’. By 2020, it was complaining that the UK’s GDP per capita was slightly lower than it had been in 2008 (for which the NEF blamed the government’s failure to ‘invest in insulation and renewables’), but it never lost its fondness for terrible policies. Rent controls? Yes please! A wealth tax? You bet! Price caps? Of course! No wonder Fahnbulleh thinks Polanski has stolen her ideas. (Having your ideas stolen by politicians is kind of the point of think-tanks, by the way.)

The NEF worldview is driven by a way of thinking that is not so much ‘new economics’ as anti-economics. Its belief that a 21-hour working week will reduce unemployment shows that it has fallen for the lump of labour fallacy – the false notion that there is a fixed, finite amount of work available in an economy. Its idea of replacing fiscal rules with ‘fiscal referees’ appointed by the government – who, the NEF assumes, will give governments greater latitude for borrowing – ignores the fact that the bond markets do a ruthlessly efficient job of refereeing already. The Bristol Pound and similar local currencies rest on the foolish belief that places get rich by not trading with outsiders.

Immerse yourself in the world of the New Economics Foundation and you will be transported to a parallel universe in which Britain is a night-watchman state practising ‘trickle-down economics’, ruthlessly cutting benefits and doing sod all about the ‘climate crisis’. Despite public spending rising from 40 per cent to 46 per cent of GDP and the national debt trebling since 2007, the NEF has consistently maintained that Britain is labouring under ‘austerity’. Despite income inequality falling to the lowest level in 30 years, the NEF’s current chief executive, Danny Sriskandarajah, insists that this is ‘a time of rising inequality’ and that we are ‘living through an inequality crisis’.

This is the organisation that Miatta Fahnbulleh ran between 2017 and 2023, when it dropped the silly but endearing hippy stuff and became a run-of-the-mill left-wing think-tank. Now she is at the heart of government and her latest successor has congratulated Andy Burnham for ‘calling time on trickle-down economics’ and for going ‘beyond aggregate growth’.

As for Net Zero, there can be no doubt that Fahnbulleh is at least as zealous as her old boss, Ed Miliband. In an article written in 2019, in which she claims that British governments on the left and right have ‘spent decades following a neoliberal recipe of tax cuts, reduced social welfare benefits, and deregulation’, she called for Net Zero to be achieved ‘within 10 to 15 years’, which would be ruinously expensive if it were not utterly impossible. She is a staunch supporter of the Green New Deal, which the NEF helped devise back in 2008. She has applauded Extinction Rebellion and used to be the chair of the Croydon Climate Crisis Commission. If she’s using the issue of climate change to climb the greasy pole, she has been playing a very long game.

Instead, there is every indication that Fahnbulleh is a true believer, a dyed-in-the-wool climate ideologue with delusional economic beliefs for whom no cost is too great for the prize of decarbonising the United Kingdom. She genuinely believes that energy costs are too high because we are over-reliant on fossil fuels and wants to make a ‘big sprint’ towards a Net Zero electricity grid by 2030.

Don’t assume that things cannot get worse. Things can always get worse.

Christopher Snowdon is director of lifestyle economics at the Institute of Economic Affairs and the co-host of Last Orders, spiked’s nanny-state podcast.