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Opinion | Niall Ferguson

Theresa May’s Abbanomics and Brexit’s new class war

UK Prime Minister Theresa May. LISELOTTE SABROE/AFP/Getty Images

“If you believe you’re a citizen of the world, you’re a citizen of nowhere. You don’t understand what the very word ‘citizenship’ means.”

Those were the key words of a speech by Prime Minister Theresa May of Britain, at the Conservative Party conference in Birmingham last week. My response — as a fully paid-up member of the rootless cosmopolitan class — was: Ooh la la!

Welcome to the new class war, Brexit edition.

On one side, the citizens of the world — the Weltbürger — who are only citizens in the sense that Orson Welles’s Citizen Kane was a citizen. We have at least two passports. We speak at least three languages. And we have at least four homes, not one of them in the town where we were born.


On the other side — seething with resentment against us — are you citizens of the nation state. You have one passport, if that. You hate the few words of French you learned at school. And you live within driving distance of your parents or your children.

No prizes for guessing which group is more numerous. No matter how many donations the global elite made, philanthropic and political, we could never quite compensate for that disparity.

Well, we had a pretty good run. Nearly 30 years of globalization, information technology, and bubbly asset markets, from 1979 until 2008. And what fun it all was! The Bolly. The beluga. The bling. Since the financial crisis, however, the tide has turned, despite such inspired devices as quantitative easing (whose benefits to us can be, well, easily quantified). We may as well face it: 2016 has been the global elite’s annus horribilis.

When we met at Davos, in January, we could still laugh at Donald Trump. Then he won the Republican nomination. When we met again, in Aspen in the spring, we could still joke about Boris Johnson. Then he (inadvertently) led Brexit to victory and became foreign secretary. All summer long — from Lake Como to Martha’s Vineyard — we clung to the hope that the economic consequences of Brexit would be so dire that the voters would repent. Wrong.


Now, as the nights draw in, we rootless cosmopolitans have gathered in Washington for the usual International Monetary Fund meeting. Gloomily, we agree with the German finance minister, Wolfgang Schäuble, when he says: “More and more, people don’t trust their elites.”

Cue Theresa May.

May’s speech last week did three extraordinary things. First, she made it clear that we are destined for “hard Brexit.” May has understood that, in June, the country voted to restrict immigration and that ending free movement of EU citizens must mean our departure from the European single market. She has therefore decided to make the best of it. Her appeal to people who “find themselves out of work or on lower wages because of low-skilled immigration” was as unambiguous as her allusion to the “social contract that says you train up local young people before you take on cheap labor from overseas.” Ooh la la!

Second, this was a complete repudiation of Thatcherism, aimed directly at disillusioned Labour voters. “The good that government can do.” She used that phrase five times. She pledged “to put the power of government squarely at the service of ordinary working-class people.” She even asserted that “the state exists to provide what . . . markets cannot,” declaring her readiness to “intervene . . . where markets are dysfunctional.”


Yet the most daring part of this speech was May’s sustained barrage against the “privileged few . . . the rich, the successful and the powerful . . . the powerful and the privileged . . . the rich and the powerful.” Not since Edward Heath called Tiny Rowland “the unacceptable face of capitalism,” in 1973, has a Tory leader talked this way.

And that is precisely what perturbs me. Months ago, I warned readers of this column that a vote for Brexit risked throwing the UK back to where it was 43 years ago, when the country first joined the European Economic Community. I now fear this is exactly what May has in mind.

Forget the token nod to “the world’s leading financial capital.” Discount the lame reference to “Global Britain.” As the pound fell off a cliff on Thursday night, Britain was back in the 1970s, every which way: first the industrial strategy, then the sterling crisis. The Japanese got Abenomics. This looks more like “Abbanomics” — named in honor of May’s favorite band.

My favorite ’70s band was always the Faces, and all this reminds me of one of their greatest hits: “Poor old Granddad,/I laughed at all his words./I thought he was a bitter man,/He spoke of women’s ways./‘They’ll trap you, then they use you/before you even know,/For love is blind and you’re far too kind,/Don’t ever let it show.’ ”


Altogether: “I wish that I knew what I know now,/When I was younger.”

The name of that song? “Ooh la la.”

Niall Ferguson is a senior fellow at the Hoover Institution at Stanford University.