Commercial Summary: Labour risks facing a perfect storm that unseats Starmer. Unrest in Britain is set to grow. And the risk of a major financial crisis is rising.
Cataloguing Prime Minister Sir Keir Starmer’s woes is a difficult exercise. Where does one begin?
First, there is the growing unrest risk, now centred on the little town of Epping in Sussex, where locals angered by an alleged sexual assault by an illegal Ethiopian migrant targeting a 14-year old girl. Locals responded by protesting at The Bell Hotel, where the illegal migrant was housed. Essex Police went so far as to escort far left, pro-migrant counter protesters to the site of the hotel - something which they would never do for the other side (police would normally allocate a separate area further away from the original protest). Now, the local head of police has called for the hotel to stop housing migrants, and the government moved the illegal migrants to a hotel in Canary Wharf, where unrest is also beginning.
Then there is the challenge from his left. Jeremy Corbyn and Zarah Sultana, both formerly of the Labour Party, have announced a yet-to-be-named new party. There is a high risk that, with Labour’s polling collapsing, and the far left wing of the party refusing to associate itself with any (absolutely necessary) cuts to welfare spending, at least some Labour MPs would defect to join Corbyn. Already, Muslim independent MPs have joined the party. The PM’s perceived unquestioning support for Israel is almost certain to alienate the Muslim vote, which may go to this new party, threatening perhaps up to 30 seats previously considered safely Labour. Courting those votes is certain to create a problem with Starmer’s Jewish supporters, who are considerably less numerous but still have considerable influence.
Then there are the financial challenges. Gilt yields, the returns on government debt, are rising, suggesting that the market perceives a greater risk that the government will not be able to repay its debts. With good reason: borrowing has exceeded forecasts for months, while Rachel Reeves’ disastrous budgets have caused employment to fall alongside tax revenues: simply, it is better to be rich somewhere else, and to invest somewhere else, rather than in overregulated, net zero, DEI-obsessed Britain. Already, Gilt yields have exceeded the levels experienced under the premiership of Liz Truss, though the media, and the Bank of England, have refrained from speaking in the same manner, allowing Starmer to remain in place.
Commercial Implications:
Despite polling showing Reform in the lead in any future election, predicting the outcome of the 2029 election is a mug’s game. The right is split between Reform, the Conservatives, and whatever MP Rupert Lowe’s Restore Britain movement may throw up. Similarly, the leftwing vote is split between the LibDems, the Greens, Labour, and Corby’s new far left-Islamist coalition. The scenarios can include anything from a resounding triumph for the right, the left benefiting from right wing disunity and winning, or a highly fragmented parliament. However, we are relatively certain that Labour will not be in power after the 2029 election.
The success of the Epping protest in closing the illegal migrant hotel, and the near certainty that sexual assaults by illegal migrants will repeat, are going to lead to more unrest. Furthermore, the media is unlikely to be cooperative, given how Starmer hid the facts of the Southport murders.
Keep reading with a 7-day free trial
Subscribe to Modad Geopolitics to keep reading this post and get 7 days of free access to the full post archives.