Replacing Starmer/Reeves with another captive of the finance sector will change nothing

June 22, 2026
bill
Britain, Demise of the Left, Reclaim the State
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Successive governments in the UK – Labour and Tory – have pushed the nation to the brink where there is little capacity left for progressive policy. And I am not referring to Brexit. Rather, the elevation of the financial sector as a primary force in the economy, dating back really to the Callaghan Labour government and then fast tracked by Thatcher and Blair, has resulted in almost every important part of the economy being devoured by the greed machine. This is relevant to the leadership struggle in the UK Labour government, which should see the lamentable Starmer replaced by the (to be assessed) Andy Burnham. The latter would be the first Prime Minister to hail from Lancashire since David Lloyd George (1916-22) although Harold Wilson came from nearby Yorkshire. The problem the new leader will face apart from his own misguided notions about fiscal capacity and the need for ‘strict’ fiscal rules is that the financialisation of the British economy (like most economies in this neoliberal age) is so pervasive that the spheres of resistance to change are everywhere.

I have previously written about the way in which Capitalism evolved into a system that commodified everything – work, recreation, family etc.

For example:

1. How to break out of the commodification of everything (July 14, 2025).

2. To reclaim the state, we have to start with ourselves (December 21, 2021).

3. Sport and doping – the spreading tentacles of capital (February 11, 2013).

In 1974, Harry Braverman’s book – Labor and Monopoly Capital: The Degradation of Work in the Twentieth Century (New York, Monthly Review Press) – was very insightful for progressive thinkers.

He focused initially on specifying the essential nature of the capitalist labour process as part of his enquiry into the de-skilling of workers as a control tool designed by capital to extract ever more surplus labour from workers.

He argued also that these “labour processes”, which attach market-values to intrinsic human activity, have progressively subsumed our whole lives – sport, leisure, learning, family – the lot.

Everything becomes a capitalist surplus-creating process.

Early capitalism was marked by workers going to the workplace and producing surplus value, but then being able to escape the labour process after hours to enjoy non-surplus generating activities (like sport, etc)

Harry Braverman understood that capitalist profit-making would seek to impose its constructs on all aspects of human activity.

Even those activities that were previously part of our non-working lives – our lives away from the oppression of work.

So activity or effort that helped communities – planting a tree or helping an elderly person wash or whatever – was not considered to be ‘work’ under this spread of labour processes unless it generated surplus value (and manifest as profits).

Such work was vilified as being unproductive and constituted boondoggling.

That is one of the reasons the elites have been long opposed to government direct employment creation.

Of course, neoliberalism ensured that even these caring activities became labour processes as governments were pressured into outsourcing or privatising public service delivery.

I am also working on a research paper at present exploring the way the so-called – New Public Management (NPM) – has infested our higher education sector.

NPM proposes that government entities delivering public services should be considered no different to private corporations that seek profits.

So billions are now spent by governments on private management consultants who produce elaborate PowerPoint presentations that advocate market-oriented, performance-driven management, regardless of whether that approach fits the basic purpose of the public institution.

It is an extension of the trend that Harry Braverman wrote about more than 50 years ago.

During those 50 years or so, capitalism evolved into its financialisation phase, largely replacing the – Robber baron (industrialist) – with the – Bankster – where billions are now made for doing nothing productive.

The recent article (June 17, 2026), by academic and Labour member of the House of Lords Prem Sikka – The finance curse is devouring the UK – is sober reading.

He notes that:

The finance industry now controls significant parts of the UK economy. It extracts wealth, destroys jobs and weakens economic resilience. Governments go to extraordinary lengths to promote and protect the finance industry, whilst neglecting other productive areas, such as manufacturing.

He recounts the history of this rise to prominence as a series of episodes where the banksters chased easy profits through aggressive business practices, fraud, corruption, etc and the eventual overreach then required government bail outs.

Privatise the profits, socialise the losses.

After many regional or localised bank or finance collapses, the feeding frenzy came unstuck in a global sense during the GFC.

Once again the public bailouts were spectacular.

Prem Sikka estimates that:

The state provided £1,162bn (£133bn cash and 1,029bn guarantees) to rescue banks, and £895bn of quantitative easing to stimulate financial markets. The economy is yet to recover. The average real wage has hardly changed since 2008. Between 1995 and 2015, the finance industry made a negative contribution of £4,500bn to the UK economy, effectively wiping out 2.5 years of gross domestic product.

And while that event should have led to a total rethink of the way the financial sectors are allowed to operate, the reality is that nothing much changed.

Unregulated shadow banking continued and governments allowed “private equity and hedge funds, to expand and devour the economy”.

Prem Sikka writes that:

Private equity takes over existing businesses with finance from banks, insurance companies, pension funds and wealthy individuals seeking higher returns. It acquires control but injects little share capital. Takeover targets are loaded with the secured debt, often routed through opaque offshore entities, and are expected to pay it off. Financial engineering, asset-stripping, staffing and wage cuts, dumping liabilities and tax abuse are key elements of the business model. When businesses are collapsed, private equity and banks, as secured creditors, walk away with most of the proceeds from the sale of the business assets, leaving little for unsecured creditors and pension schemes.

This is late stage capitalism.

And the tentacles of private equity are everywhere gaining footholds in all the previously public activities such as airports, utilities, education, health care, etc.

It is all about ‘extraction’ until there is no more to extract then ‘liquidating’ while leaving the mess behind.

The role private equity has placed in the water sector in the UK is a stunning example of the failure of this approach.

Prem Sikka also notes that “governments have financialised humanity” – by allowing essential healthcare and retirement services to be taken over the private equity firms via contracted-out arrangements and outright privatisation.

I went to my dentist recently and when once you went into the surgery and was met by your favourite dentist, the new model is that some front person comes out and discusses your dental hygiene with you, shunts you into a hygienist’s chair who probes around, then calls in the dentist to consult, and the fees for all these overheads are ridiculous.

As an example of how governments have become agents for finance capital one only needs to study the details of the – Financial Services and Markets Bill – which is currently before the British Parliament.

Proponents claim that it is about driving economic growth but it comes at the expense of maintaining regulatory oversight, with no guarantees that the new flexibility will drive growth anyway.

The Bill shifts a swathe of corporate and financial rules (and their enforcement) out of the hands of Parliament and into the ‘independent’ regulatory authorities who are technocratic and unaccountable to the electorate.

Prem Sikka concluded:

The economy has been devoured. Low wages and tax abuse have been normalised. Town centres have become economic deserts. Wealth extraction is prioritised. Unprecedented resources are devoted to financial engineering and tax abuse.

The flaw in the whole surrender by government to the finance sector is that by making it easier for speculative capital to move in and out of sectors with less oversight, the payoff will be higher productivity and improved living standards for all.

It has simply not transpired over more than five decades of progressively ceding control to the finance sector.

Turning the economy into a wealth-shuffling casino where the workers are pawns in the risk taking produces nothing of benefit for society.

A 2018 academic research paper – The UK’s Finance Curse? Costs and Processes – found that by allowing the finance sector to become ‘too big’ (misallocation of resources) amounted to “147.4 per cent of 2015 GDP.”

Potential investment funds are channelled into non-productive but high yielding (for the winners) assets – “high collateral financial assets (such as property, or liquid financial instruments,) often contributing to price volatility, at the expense of longer term productive investments in technological and R&D intensive areas.”

There is a “brain drain” of highly educated and skilled workers into the finance sector because of the massive salaries that are available.

The problem is that politicians see no way out of this trend.

The finance sector just has to hint that it will ‘sell off currencies’ or whatever, for politicians to put any idea of reform away and, indeed, further relax the regulatory oversight.

This is the environment that the likely new British Prime Minister will be confronted with.

Andy Burnham has been a serial challenger for the leadership of the Labour Party.

His background is not encouraging.

Perhaps people have forgotten his role as a Blairite.

The Times article (May 23, 2026) – Who is Andy Burnham really? Teen ‘scally’ to professional outsider – notes that Burnham wore “Armani suits under Blair”.

He was a right-wing Blairite advocating the privatisation of NHS contracts and other pro-market policies.

When Jeremy Corbyn looked like becoming leader in 2015, Burnham threatened to resign from the Shadow Cabinet if Labour withdrew Britain from NATO (Source).

More worrying was his elevation in June 2007 under the failed Gordon Brown to the position of – Chief Secretary to the Treasury – which was highlighted by his role in the – 2007 Comprehensive Spending Review.

Among the changes that the Review made were:

1. It reinforced the notion of ‘fiscal consolidation’ – read austerity.

The Review sought to reduce the annual real growth in public expenditure by 50 per cent (4 down to 2) over a three-year period.

2. It hacked into the public service – 110 departmental-based Public Service Agreements were merged into 30 interdepartmental agreements with the aim of saving around £35 billion or around 3 per cent per Department per year ongoing (Source).

The service capacity of the public service was severely compromised by the changes.

In recent times, as Burnham was building his public appeal again as part of his next ‘challenge’ for Labour leadership, he conceded that he would stick to the fiscal rules demanded by the finance sector – which cut spending for the poor and ensure the top-end-of-town is never short of public money commitments.

The Times article (cited above) wrote:

Big business is willing to allow very little right now—and has pushed Labour to stick with austerity and water-down the mildest of reforms that could put up barriers to profit-making.

Winning reforms requires a confrontation with big business through working class struggle outside parliament.

Today, Burnham is part of the “soft left” of the Labour Party. It sees parliament as the only way to bring about change, rather than working class struggle on the streets and in workplaces.

So, whenever push comes to shove, it accepts those parameters and ends up siding with the right.

Millions are desperate for a political alternative to austerity, imperialism and inequality.

Burnham is capable of being many things — but he is not capable of becoming the answer to the social crisis or the rise of Reform UK.