428. Rory vs. Alastair: Are we spending too much on defence?

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Welcome to the Restless Politics with me, Rory Stewart.

And with me, Alistair Campbell.

And Rory, you said something very interesting last week, which I want to develop when you said you were beginning to change your mind about the merits of increased defense spending, which, given that defense is so high up in the agenda in so many different issues, not least Russia, Ukraine, Gaza, etc.

So we're going to talk about that.

We're going to talk about tariffs and we're going to talk about labor and the unions with a couple of little skirmishes going on on that front, including the doctors, who I don't think are going to get quite as much of sympathy as they did last time, but we'll see.

So listen, let's start with defense.

First of all, in a word, do you think that by the time this podcast goes out, Trump will be saying that America is finally sending these Patriot missiles to Ukraine that they've wanted?

Question B,

will he insist that Europe pays for them?

But more importantly, I want to know why you're changing your view on defense.

Right.

On Trump, I think I've learnt painfully that predicting what President Trump will do or predicting whether what he says will actually happen is an absolute mugs game.

So it's perfectly possible that between now and when this goes out, he'll say that he's sending Patriots missiles, then he'll say that Europe's going to pay for them.

Then he'll say, I've signed a great deal with the Pacific, which means our Patriot missiles are off there.

And then he'll revert back to the Nobel Peace Prize and tariffs.

So that's my guess on Trump.

Defense funding.

Alisa, listen,

this is something that has been quite difficult for me.

So I was chair of the Defence Select Committee and I, with other colleagues, put a lot of energy into getting the UK up to a 2% commitment on GDP and Defence.

We organised debates in the House of Commons.

That was our big drive.

And I think that I, like you,

was pretty horrified by how little we were spending, by how much weight the US was carrying.

But I think we have missed just how dramatic what's now happened, what a big difference it is looking at 2%, and what it is looking at 5%.

So, just a couple of figures to start us off, and then maybe back to you on this.

The first is: we talk a lot about the peace dividend.

Essentially, during the Cold War, 1989, we were spending about 4% of GDP on defense, we and European countries.

By cutting that spending, Europe managed to free up about $4 trillion, that's $4,000,

for investment in mostly our welfare states.

If we start reversing back in the other direction, Europe and the UK will end up spending hundreds of billions of euros extra on defence every year.

I mean the estimate at the moment for Europe, for example, is going to be about 650 billion Euro every year.

And that has got to come from somewhere.

And the European Union's latest calculations suggest that about two hundred billion of that will come out of health, about a hundred billion of that will come out of education, about two hundred billion of that will come out of green investment, and about a hundred billion will come out of social care.

And then on the other side, and I can get into this in a little bit more, the other claim is that, well, this will deliver great economic benefits.

If you were asking the question what's the best way to get the British and European economies off the ground from their pretty parless state at the moment, I don't think any economist in the world would say, well, the most straightforward thing you should do is spend a lot of money on defense.

They would say you get a much better return on investment, investing in education, in health, in infrastructure, in green investment.

So it's, I think, something that's very dangerous.

And I also think that it's something that the US may come to regret because they're pushing Europe to spend more on defense than the US does when the European economy is in a much weaker position.

And the long-term consequences of that is that the Western Democratic allies, the US, will be ever more impoverished and ever weaker should the US ever wish to call on them again.

Well, let's just look at it from a different perspective.

I mean, might it be that Trump is being his self-star strategic genius and he's getting Europe to do this because that's exactly what he wants, get them to pay more and he becomes more powerful.

Just I've been, since you said it, I've been really looking into this in a quite a big way.

So you're right about the level.

So post, obviously Second world war massive at the time of suz defence spending in the uk was about seven percent of gdp and it dropped down to around four percent by the seventies and then it was up to five percent around the time of the falklands war and even then if you remember the military and those who support the military the defence industries and so forth they were saying you know we're getting perilously close to the real low end then as you say comes the peace dividend and you're saying there that this could be quite dangerous in in terms of the loss of spending that we would get for health, education and all the other things that people want their money spent on.

I guess the question boils down to whether we think it is dangerous not to do this.

So for example Patrick Sanders who was the chief of the general staff until quite recently he was saying at the weekend that he thinks we have got to work on the basis that we will be at war in some shape or form with Russia within three to five years.

And I think that is a fairly common view amongst people who are full-time immersed in this whole military planning scenario.

And his worry seems to be, and I think the worry of other people seems to be, that actually

we think we're making a massive step in saying share of GDP.

But actually, are we doing the planning and the preparation?

And do we have the resources to do it now?

Should that scenario be true?

So if you compare it, I think I said to you recently, I heard this amazing podcast on one of my German German podcasts about the reserves in Finland.

So Finland is a country with a population almost identical to Scotland.

I think it's sort of five and a half million.

And they're almost up to a million reserves.

These are people who are being trained in defence.

They're people who are being encouraged to build bunkers under their own homes and all this sort of stuff.

So I guess you're saying it's dangerous to go down that route because of all the impacts upon other parts of our national life.

I guess where I'm still coming from is I probably am more on the hawkish side of things that thinks Putin's in for the long haul, he's going to keep going till he gets Ukraine and then he's going to try and pick off a NATO country, or at least get a NATO country engaged.

Well okay so um let's maybe push this one more level.

So what's the biggest threat that we're facing in Europe at the moment?

Potentially Putin, but potentially also populism, potentially also radical far-right parties emerging, angry about a lot of things and who will be pro-Putin.

Who will be pro-Putin?

But the fundamental thing we hear most of the time in most countries is they just think their countries are broken.

Britain's broken, it's rubbish.

And what do they mean by that?

Yes, they mean immigration, but there's a lot of just public services are creaking, the economy's crap, things are not going in the direction in which they go.

So if you're labor, I guess there are two main things that you think you need to be doing, growth and public services.

And radically increasing your defence spending is not good for either.

On the growth side, there's been some really interesting modelling.

Basically, defence expenditure historically doesn't have a great return on investment just as an economic move.

The normal modeling suggests that if you put money, a pound, into defence spending, you probably get something in the region of 0.50p or maybe 90p back for every pound you put in.

Well, it sort of depends who you talk to this, right?

I was talking to somebody very much on the pro-spending side of things who was saying it's 2.2.

For every one we put in, we'll get 2.2.

I mean, listen, there's loads of.

I guess you're completely right.

I mean, obviously, a lot of this is finger-in-the-air stuff.

And the OECD does it, the IMF does it, the EU does it.

And I guess you're probably right.

Whoever your friend is would be pretty sceptical of the fact that there are huge claims made for green investment because, understandably, we all want to be friendly to green investment.

So they think pound going into green investment creates far more jobs and defence, creates far more return on investment in defence.

But the reason why it's probably true that you get less return on investment for defense is, firstly, that there's an incredible leakage.

So a huge amount, 30 to 50% of our defense equipment comes from the US and Israel.

We don't make it ourselves.

So unlike investing in education, health or road infrastructure, a huge amount of that money that we'll be spending will simply be flowing out of Europe and the United Kingdom towards other people's economies.

It's also very geographically concentrated.

If you invested in education, it would reach everybody in the country.

If you invested in defense manufacturing, it would benefit Barrow, BAE systems.

It's relatively low employment too.

It's quite capital intensive.

It also,

the only way in which we're going to be able to do this is by ramping up our debt by borrowing money.

And that also can drive up interest rates.

That can also have an effect on businesses' ability to borrow and invest in other directions.

And the final question, I guess, is that the big old chestnut is, of course, that it's true that in the US,

quite a lot of the Department of Defense investment led to these amazing things like famously the internet and global positioning.

Your Google Maps comes directly out of military investment.

But is it the most reliable way to get that tech result?

No.

And of course, Europe is littered with things of which maybe Concorde is the most dramatic example of very, very expensive, incredible tech investments, which didn't have the kind of spillovers for the economy that people were looking for.

But just a couple of examples.

So, you know, we've talked a lot, obviously, about Ukraine, and

the Russia-Ukraine war, if it's done, it's done lots of things, but one of the massive changes has been the change in the nature of warfare, in particular, drone and AI technology, where the Ukrainians seem to be doing a pretty amazing job.

Now, the Russians are responding in kind and with the rest of it.

But so that's all going to change.

And I was talking to somebody who, so, for example, was saying that we will spend billions, literally billions, on, say, the next next generation of fighter jets.

And meanwhile, AI is developing fighter jets without pilots or fighter jets with co-pilots, added to which, we're developing drone technology, which can take out fighter jets and can take out unbelievably expensive tanks.

So I think what maybe...

we need to be thinking about is the 3%, 5%, whatever it's going to be, is a signal of direction, of signaling to the rest of the world.

We think the world is a much scarier place.

Yes, Putin is a genuine threat.

There will be other threats to come, and therefore we need to build up our defenses.

But we need to do it in a way that is much more rooted in this world of technological revolution.

And the other country that I think is interesting is Estonia, because Estonia, again, has increased defence spending because it's right there at the heart of the possible sort of front line in a future war.

But it's also become one of the most significant developers of tech upstarts, many of them in the defence industries.

So, I think it's somehow it's maybe we're not disagreeing that there's a threat.

You think there's a real danger that we're going to waste a lot of money through a sort of political virility contest about what the percentage of GDP is.

I guess I'm thinking that we have to match the threat to the changing nature of warfare and also the role of societies, and that's why the Finland Reservist story is so important.

You're completely right.

And the chances are, based on what we've been doing over the last few decades, is we will really screw this up because we are very, very, very bad at defence procurement.

We're always buying kit, which turns out to be nine or ten times more expensive than we initially thought it would be.

And by the time it's delivered, turns out to be completely outdated for the environment that we're operating in.

Because the threats change very quickly.

I mean, you talked about this.

You talked about how in 2000, we're not thinking about 9-11.

Straight after 9-11, suddenly 90% of the activity of our intelligence agencies are counter-terrorism and our whole military shifts towards fighting people like the Taliban.

So that's very low-intensity, essentially fighting people on donkeys with Kalashnikovs.

And then we reorient our whole military towards that.

And then suddenly we're, and then we do a strategic defense review where Boris Johnson says, and this isn't an attack on Boris Johnson, this was the conventional wisdom of the time.

We're not going to have to fight a war on the European planes with tanks.

And then immediately Russia invades Ukraine.

So that's one problem.

We're very, very bad at predicting what the nature of the threat is and what we need.

I mean, do we, to put it bluntly, let's take your examples.

Do we need to be following Finland and having a huge number of people?

Do we need a massive army?

Do we need mass?

That's what the Russians and the Finns believe.

And that would require national service.

Or do we follow the Americans in thinking that what we need is incredibly expensive, exquisite technology and could we afford it if we wanted it?

Or do we follow your Estonian example and say what we need to spend a lot of money on is cyber defense?

I mean, UK cyber defense is terrible, really terrible.

And why is it terrible?

Basically, because we don't spend enough money on it.

We are very, very vulnerable.

We have a few decent people, but beneath the very top, there's just not enough people doing decent cyber defense in the UK.

It's terrible.

I think the other thing that we underestimate when you hear Keir Starmer and John Healy, the Defense Secretary, talking about increasing defense spending up to 3%, 5%, whatever it's going to be, is that our nuclear defenses will continue to take an enormous part of that, this new deal with the French notwithstanding.

There is already a sort of, I think, it's running about 7 billion, what they call a kind of equipment gap.

And then, of course, you've got the whole personnel issue on top of that.

So, even at 3%, if the threat is genuinely more serious than it was, you're talking about pretty tight resourcing.

And just finally, on the economic point, Rory,

so basically, during, and this is very, very inexact.

So, for example, you can point to the Soviet Union, which had a defense spending of any regularly in double figures and often up to 20%.

And basically, an economy that was completely crippled because the money never went anywhere else.

But in our economies,

growth has been higher when there has been higher defense spending in general.

And I'm not suggesting, by the way, that's one of the reasons for our state nation.

But I think that's basically because growth was higher in the 50s, 60s, and 70s.

And that's much more to do with a youthful population.

Yeah, for sure.

New technologies coming on.

And it happened to be a time we spent defense.

I guess the point I'm making is that you can look at any of these examples and fit them to make any argument.

Ultimately, we have to make political judgments.

That's the political leadership of the country.

And we all have to make judgments about whether we take this threat seriously.

Because if we do, then I think we all have to change our mindset about it.

Okay, so

let's maybe finish this one by my agreeing with you on that.

That if we are going to spend this money, boy, we better change the way that we spend this money.

So that's partly your point about coordinating much more closely with Europe, understanding that Britain, even if it's spent 5%,

can't actually operate completely independently against Russia.

It could only do so as part of a much, much bigger multinational unit.

We need to work out which bit of that we're providing, which bits the others are providing.

Secondly, understand that these defence companies rip us off again and again, and it's a really, really inefficient way of spending money to just hand money either over to American companies like Raytheon and Orthodox Grumman or even hand over money to our own big defense contractors.

These are massively inefficient, costly private sector companies in a very kind of, I think, unhealthy relationship with the government that has the government over the barrel.

And that's true in Europe too.

I think one of the problems is that we fantasize that Europe will suddenly have this amazing defence industrial policy, whereas probably what they'll end up doing is just handing over money to massive French and German defense contractors who will be very inefficient.

Maybe the bridge into tariffs is maybe to say this, that there's, I think there's been a kind of unwritten rule that this whole thing is breaking down because Trump is no longer seeing himself as in remotely as a protector of Europe.

But I think part of the unwritten rule of us

our reliance on the US was that we wouldn't sort of put all the money into our own defences, but insofar as we did, we would buy loads and loads of stuff from the United States.

It was a kind of a bit of a quid pro quo going on that.

Now, the other thing that has to happen is whether countries like ours and countries like Turkey and countries maybe like the Saudis, I don't know, Japan, develop their own defense industrial capacity in a way that actually starts to fill that gap.

Because I think that one of the things that's happening right now, and this is the direct link to tariffs, and maybe this is what we should talk about now, is the observation that if you feel that a close friend is moving away from you, you maybe start to look at other places.

I thought it was very interesting that when Donald Trump announced the new tariffs on the European Union, for example, von der Leyen, Ursula von der Leyen, was in Indonesia.

Why was she in Indonesia?

Because she was doing a big new trade deal between the European Union and Indonesia.

So why don't you use that as the peg into this week's tariff reality TV show?

I think tariffs, if defense is the most dramatic story, because it's war and conflict and it reminds us of the Second World War, tariffs is probably the most important economic story.

And it's one that we're not maybe focusing on enough because Trump plays the hokey cokey.

He puts Trump tariffs up, he brings them down and he seemed to blink against China.

So actually, if you look at the markets, they've got very complacent.

When on the 2nd of April he announced these big tariffs, markets crashed, bond markets went wrong.

Now when he plays around, they barely respond.

And I think that's because they've got themselves into a mindset of thinking, well, basically it'll be 10%

and he'll put some tariffs on steel and aluminium and chips.

But in the end, when push comes to shove, he blinks.

And this was the sort of taco story.

Trump always chickens out because he blinked with China.

But meanwhile, with nobody really concentrating, of course, nobody was concentrating.

In fact, when he brought them down on the 2nd of April, he didn't say, I'm giving up on them.

He said, it's going to be 90 days.

And the 90 days has just run out.

Hold on.

He said he was going to do 90 deals in 90 days.

90 deals in 90 days.

Yeah.

During which time he succeeded in doing maybe one and a half deals in 90 days.

Yeah.

And then two frameworks.

Two frameworks.

And the 90 days then ran out.

Now, what's really interesting is that during that time, many, many countries very, very earnestly have been working away.

And maybe the best way of showing this is through Europe.

So Europe is a huge trading partner for the US.

18.5% of US imports comes from the European Union.

The European trade negotiators have been working day in, day out for three months.

And if you looked at the reporting 10 days ago, right from the inside of the US and European camps, they felt that they had ended up on something that would be a sort of version of the deal that Kirstama got.

It was going to be 10% baseline, few exceptions.

And then if you see your friend Muchtaba Rahman being interviewed sort of a week ago, he's saying it'll be 10% and we'll knock holes in it like a Swiss cheese with a whole series of exemptions and stuff that we get.

That began to get a little shaky about a week ago.

But then the optimistic story was, okay, Europe is going to offer a concession on digital service taxes.

And this is what Canada just did with Mark Carney.

He suddenly abandoned a 3% tax on American digital companies.

And it'll be fine.

We'll get it through.

We're almost there.

We're working with these very senior people.

And then suddenly, Trump on Saturday puts out something which says, not only is the entire deal off, three months negotiations out the window, but he's not just going back to where we were on the 2nd of April, he's putting it further up.

The EU tariffs were 20%, he's put them up to 30%.

The Mexico tariffs were 25%, he's put it up to 30%.

Canada's tariffs on the 2nd of April 25, he's put it up to 35%.

Japan's gone up slightly.

South Korea has stayed the same.

So it's shattering.

I think the thing that I really say is anybody who is being complacent, buying into the taco theory, saying Trump doesn't mean it, he's never going to do it in the end, there's no evidence for that.

I think the evidence suggests that Trump loves tariffs and he will, throughout his presidency, put them up whenever it suits him to achieve any number of different things.

Maybe he's chasing trade deficits.

Maybe he just likes humiliating people, getting concessions.

But we can assume, if you're running a business, that we are in the most unpredictable global trade environment that's existed for almost 100 years.

Yeah, where you're right, and this is really interesting, and I think this is because the world has

really come to see that Trump is doing the reality TV show that we talk about with Michael Wolfe.

He is sort of his day-by-day a different story.

And then there's this sort of complete lack of clarity issue.

And you see interviews.

So I saw an interview with one of his people the other day, and it was just mind-blowing because the interviewer was trying to get them.

They were actually talking about the role of Congress.

And Congress can only be bypassed in relation to putting on sanctions like this when there is a national security issue or a national emergency issue.

So the question the interviewer kept manfully, personfully putting to this person, I've forgotten who it was, but it's one of his sort of, you know, MAGA people, was what is the national security issue?

What is the national emergency that leads to Trump's fears of Bolsonaro going to jail requiring Americans to get more expensive coffee?

Because this is the other thing.

Trump talks, and because we know that Trump, if he says something, he believes it to be true, and he thinks he can persuade his followers to believe it can be true.

But the truth is, apart from a little bit in Hawaii, America doesn't make coffee.

Lots of Americans drink lots of coffee, so it gets imported from places like Brazil.

And suddenly, he's put a 50% tariff on it.

And then, like, well, you mentioned Canada there, Rory.

So, you've the

basic tariffs gone up to 35%.

There's already a 50% tariff on steel and aluminium.

And nobody, none of these people who've been interviewed on behalf of Trump, none of them can say, is the new tariff 35%?

Is it 50% still?

Because that's higher than 35%, or is it actually 85

and so the lack of clarity that's what suggests to me that he's just throwing these numbers out and there's a guy um i don't know if you follow this guy rory he's an australian economist but he's based in the states and he's really really good at explaining complicated things called justin wolfers and he clocked 11 so far i'll do them very very quickly the different reasons that trump has given for his tariffs the first lot if you remember on canada it was fentanyl then it was was illegal immigration from Canada and Mexico, then it was to save manufacturing in the Midwest, then it was to boost national security, then it was to avoid income tax rises, then it was to solve the deficit, then it was leverage for trade deals, 90 deals in 90 days, then it was to defend the role of the dollar as the reserve currency, then it was to get Canada to drop the digital services tax, which they did, then it was to get Spain to spend more on defence, and finally, it's to keep his fellow insurrectionists against his own constitution, Bolsonaro, out of jail.

To pay tribute to another Australian, my hero, Dmitry Grozubinsky, who I spoke to for an hour on this, who has written this incredibly good, amusing, intelligent book on tariffs and trade, which I'd really recommend to people.

He would say that underlying those are five completely contradictory ideas around tariffs.

So I think we've talked about a little bit before.

We've talked about the fact that, you know, one is you manufacture in China, then you charge at the US border and you make a lot of money.

So it's about revenue.

Number two, it's about reshoring, moving manufacturing to the US.

So then you don't get the revenue because you're making it in the US.

Number three, you're doing it for something else, like fentanyl or immigration, in which case it's not economic at all.

Number four, you're doing it because you're in a 50-year fight with China and the whole thing is really just about impoverishing China to stop it building up its military.

And number six, I think, is just a general sense that you're enjoying the game of extortion, concessions, humiliation.

Maybe that's the sort of thing that binds it all together.

Along with the first one, which is obsession with trade deficits, is just this sense that it's a tool in its arsenal.

It allows you to humiliate people.

Brazil, though, is the most interesting.

You're right.

And I should have raised it, because Brazil is the one example of these countries that doesn't actually have a trade surplus with the United States.

So

generally, what he's doing is he's going after countries that sell more to the US than they buy from from the U.S.

And, of course, one of the big reasons for that, again, as Dimitri points out, is that U.S.

consumers are wealthy and spend a lot of money.

The average American household spends two and a half times more a year than the average German household.

And a lot of the goods they buy come from abroad, right?

But in the case of Brazil, that isn't the problem.

Brazil is importing more from the U.S.

than it's exporting.

So there, what he's doing...

is he's saying that he hates Lula, that he thinks the case against Bolsonaro, his fellow populist leader who's basically on trial for trying to stage a coup d'etat, is fake.

And he's very much against the Supreme Court Justice Alexandra de Morales, who's a very, very controversial figure that we were talking about over the weekend, who is a hero of the left and an absolute enemy of other people in Brazil, because he's doing many things which are pretty close to absolutist, authoritarian, and illegal to go after anybody who he thinks is on Bolsonaro's side, including imprisoning business people for making jokes about coup d'etats on WhatsApps, locking up congressmen for nine years for contempt to call this sort of stuff.

So, all of this stuff is happening.

But my question to you is: how would the world react if China went around doing this?

Oh, exactly.

Exactly.

I mean, let's say China had got in touch with France and said, we'll be imposing a 50% tariff on you unless you release Maureen Le Pen from jail.

Yeah, or if they'd done the same with us and said, unless Julian Assange is released and freed from the whichever embassy he was in, it was Ecuador.

The answer to your question is that we would say this was

unacceptable, bullying, intimidating behaviour by a rogue state.

That's what we'd say.

But I think this goes to the heart of the way that Trump now operates.

He basically, in all of his international affairs,

there's a little bit of divide and rule.

But what there's a lot of is the demanding of obsequiousness in exchange for not usually political support, but just sort of not giving you quite as

hard a time as he otherwise could.

And I don't know if you saw Roy the now infamous meeting with the African leaders where he congratulated the Liberian president on his excellent English,

either not knowing or pretending not to know that English is the language of Liberia.

But three of the leaders who were there, Senegal, Gabon, and Mauritania, all, as part of their prepared remarks, basically said that they thought Donald Trump should get the Nobel Peace Prize.

So, this is all just part of a.

We're all, when we say we, I don't think you and I are, but I think large parts of the world are playing into this idea that he's the king of the world.

He has actually become what Boris Johnson always wanted to be: world king, and that's how he has to get treated.

Can you help me understand why, what's going on with this culture of so many political leaders coming pretty close to embarrassing themselves in falling over backwards to be unbelievably obsequious.

I know people say it's like dealing with a king, but actually,

my memory of kind of medieval Britain.

Were you around then, Rory?

I was definitely around that.

Yeah, I know it's older than you think.

Is that they didn't actually cringe in quite this way, that if you were a knight or a lord going in to see an English king, you tried to preserve your dignity.

Yes, you were polite, but you didn't actually grovel on the ground, call them daddy, tell them they were the best person ever.

And if you did, you'd suffer real content.

I mean, I can't, you see,

let me put it, forget medieval England.

I can't imagine Angela Merkel or Theresa May grovelling to Trump in the way that Mark Rutter's groveling to Trump.

Rutter was the most obvious.

However,

the reason that sort of was so damaging was because it was the combination of what he said in private with what he then said in public with the daddy thing that sort of took it to a different level.

I thought actually watching these African leaders, it was pretty obsequious.

I mean the truth about the Nobel Peace Prize, anybody with a, you know, any sense of the state of the world right now is going to say it is a total absurdity.

Added to which, not least because of which is sometimes called the Richard Holbrook principle, the Nobel Committee basically thinks if you openly, overtly campaign to get the Nobel Peace Prize or talk about your own strengths and why you should get it, it makes it less likely that you will get it.

But he will be saying, yeah, but I break all all the rules.

This is like a global intimidation campaign of these five people on the committee that I vetted last week.

But he's co-opting all these other leaders.

And here's one: Nick Thomas Simmons, the British minister, was on the radio recently.

And I actually think he's a very, I think he's actually a very good minister.

And he's done all the kind of European negotiations and that sort of thing.

But at the end of the interview, it was thrown at him: you know, Benjamin Netanyahu has said that Trump should get the Nobel Peace Prize.

Do you agree?

And of course, as we get closer to the state visit, which has now been announced for September, they're all going to get asked this.

So by advice to the British government, have a line ready.

Make sure it is not yes,

but

make sure that it's something that Trump could maybe not take as a total rejection.

Let me just weave these two ideas that you've got together, which is Trump obsequious.

Nobel Peace Prize in Defense Money.

The truth is that Trump is

a contributor, massive contributor, to global conflict because,

in essence, the peace that existed since the Second World War was based on a rules-based international order, NATO, the UN, US as a global policeman, and a sense that you did not invade neighbors and that certain kinds of things were not acceptable.

International law.

And of course, there was hypocrisy, and many listeners will get in touch and say there was a lot of nonsense going on in the 80s and 90s, and the US got a great deal wrong, as did the UK.

But Trump is the first president to set about very deliberately to dismantle that entire international system, to show complete contempt for international law, for the UN, for allies, for state borders.

He's somebody who has made it perfectly clear that he sympathizes with Putin and authoritarian strongmen.

And therefore, he has created, it's no coincidence that he comes in in 2016 and a lot of what we've seen over over the last 10 years, every year, more internally displaced people, refugees, conflict stems from Trump's style of isolationism and populism.

He drives the conflict.

And the consequence of that is that he creates the conditions which makes Putin and Russia become an existential threat to Europe.

He creates the conditions which then forces Europe to have to increase its defense spending.

He creates the conditions which will lead to hundreds of billions of Euros being removed from our health, education, and welfare budgets over the next few years.

Our people will get poorer, less educated, less healthy.

The world will become more dangerous thanks to Donald Trump.

And that's what the Nobel Peace Prize Committee should remember.

Very well put, but also you're looking at today, as he goes around saying, and as Netanyahu says, this guy's bringing peace to countries in the region.

The fact is, he is a driver of this Gaza quotes humanitarian fund, which and we're going to talk about this in question time, where so many people people are being killed while they're literally while they're queuing for food Gaza is we keep hearing the ceasefire is coming but has it yet come no he's enabling and empowering Netanyahu in his style of politics and then you've got Russia Ukraine which is not in a better place than it was when he said he was going to resolve it in 24 hours added to which you've talked a lot Rory about this sort of you know sense of the conflict that there is right across Africa from from west to east but there again he has the African leaders in the country the other day.

What was his real interest in all that?

It was about minerals, it was about copper, and it was about mines, and it's all about the money stuff.

So, no, we disagree slightly about defence.

I think we are fundamentally united in our view that the Nobel Prize Committee's reputation would be zero, literally zero overnight, if it were to make the mistake of giving the award to Donald Trump.

I actually think it was a mistake to give up to Obama so early in his presidency.

I agree.

But there we are.

Not as big a mistake as Gandhi never getting it.

I think that was a bad one.

Gandhi never got it.

While we're talking about defense, Rory, I think it's we did.

Our leading interview this week is with a friend of yours, Democrat Congressman Seth Moulton, who is not just interesting because he's a congressman with some very, very harsh words to say about Trump, but also some very harsh words to say about his own side as well.

But also, one of those congressmen who really was a sort of serious military veteran and with some, I thought, really moving accounts accounts of his time serving in Iraq in particular when he clearly didn't believe in the policy he was involved in.

But people are interested in that whole thing about the sort of defence, military switch to politics.

I really enjoyed it.

I actually think in our upsum, I listened back to it today.

I think we were a bit a little bit harsh actually.

I found him really impressive

listening back.

Really impressive.

So pleased to hear that.

Yeah, I was sad that you said that you didn't think he should be president.

I'm pushing for Seth to run again for the presidency.

People can listen to it, of course, on the rest of this politics leading, on our leading stream.

Yeah, I definitely think he's got a lot of what it takes.

Let's take a break and then we'll come back with Britton.

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More recommendations to come.

Welcome back to The Residence with me, Alistair Campbell.

And with me, Rory Stewart.

And Alistair, we're now getting on to something that we have talked about in the past, which is the Labour Party public sector reform, particularly what can happen to the National Health Service, how that could be turned around, and the question of the unions and all of this, and particularly this week, because there's been a big standoff between Angela Reiner and UNITET, the largest union in the United Kingdom, and now a threat of junior doctors going on strike against West Reating, the Health Secretary.

Can you just begin by just giving us a sense of why unions continue to matter in British politics, politics, particularly for the Labour Party.

And do they matter much less than they did when you were in government with Tony Blair, or is it pretty much the same story?

I think if you track it back, so when I was growing up, the big trade union leaders were every bit as well known as

all but a handful of the major politicians.

You know, you could, they, and I'm not just talking about Arthur Scargill, the miners leader, but, you know, there was a whole range of trade union leaders who were, they were big figures, they're on the news all the time.

And I think that one of the reasons, so at the moment, you mentioned the Angela Reyna

dispute with Unite.

What Unite say this is about is the this continuing dispute about the dustbin collection in Birmingham and the what they identify as a huge pay cut for some of the people who are involved in refuse collection in Birmingham but I think part of what's going on I'm not minimizing their their case case, but I think part of what's going on is that these days the union leaders have to actually fight quite hard in what is a political attention economy, if you like, to get noticed.

So I think if you know, talking to people who are you know close to Angela Reiner, I think they would say that this is about them using Angela Reiner's position as Deputy Prime Minister and the member of Unite to drag her right into something where they want her to be, as it were, on their side in a dispute that should be being settled by the council involved.

Just to explain what happened here, Unite says that they've suspended Angela Reiner from their union.

Angela Reiner says she'd already resigned anyway, but in a sense, it doesn't really matter whether she was suspended or resigned.

This is a big break with the Deputy Prime Minister from the biggest funder of the Labour Party and the biggest union in the country.

Yeah, now what is also true, you talked about the difference between our time.

I think during our time, because

we were very deliberately making party funding, the funding of the Labour Party, as broad as possible, and that included part of our whole shtick to the country, the pitch to the country, was that we're a party not just for the unions, but for business and for consumers and not just for those who produce services, but above all, those who use them.

It was a different part of that messaging.

And so the funding from unions became less significant.

It's still important, don't get me wrong, you still have the unions making significant contributions.

But I think part of what's going on is actually Unite and the leadership, Sharon Graham, making broader complaints about the direction of the Labour Party.

And this is this, you know, this has given her the opportunity.

She's been on the airwaves in recent days and weeks in a way that she most of the time isn't.

And of course, the other thing that's going on in the background, I don't know whether this, I'm not saying this is organised, but in the background, you've got the whole sort of Jeremy Corbyn, Zara Sultana, might they be setting up a new party to the left of the Labour Party?

And that, I suspect, is kind of feeding into this debate as well.

Aaron Ross Powell, and I suppose you might think that it could work for Labour to have a big public fight with the trade unions, particularly at a moment where they're being accused of

not being fiscally responsible, wavering over welfare, giving in to revolts, their backbenches.

I mean, it might, if what Kirstama's about is trying to appeal to Middle Britain and brand himself as a kind of responsible centrist, then maybe it doesn't do him any harm to be seen as having a bit of a standoff for the unions because it certainly wouldn't suit him for his voter base if he'd be seen to roll over all the time, right?

Yeah, I don't think there's any point in having fights for the sake of having the fight.

I think these fights should be over things that really matter.

What I think is true is that

having been defeated essentially, or having had to back down, for example, on the welfare rebellion, on the welfare bill and change it fundamentally in order to appease the parliamentary rebels.

I do think that when, you know, he needs pretty quickly a message that says that does not mean that I'm not in the business of reform and including of very difficult reforms where we are going to have to make decisions that, you know, people that may support us and want to continue supporting us don't actually like.

And maybe that's a useful bridge into the row with the BMA because, of course, I think what one of the things I think Labour thought they'd achieved in the early days of the Labour government was to strike a deal with the striking doctors and that seemed to put the issue to bed for a while.

Just quickly for international listeners, BMA British Medical Association and a lot of the fight I think at the moment is that right is with junior doctors?

Well they've changed their name now to their name has been changed to resident doctors and I think that was a sensible thing because junior doctors was a ridiculous label for people who did so much of the work.

The BMA for international listeners and I suspect for a lot of domestic listeners as well, sometimes referred to as the most powerful trade union in the country now it's not seen in the same way as the unite or you know some of the more traditional working class manufacturing unions and so forth but the bma operates as a very very very powerful voice for doctors i know quite a lot of people in in in medicine and and including in the bma my sense is that there was a lot of support for the resident doctors first time around including from as it were people in other levels of the medical profession, but much, much, much less so this time.

Because I think what this one does,

it shows that they really do think they're a very, very, very special case.

Now, you could argue, well, they are a special case because they're saving our lives and all that stuff.

But teachers are a special case.

And, you know, the bin men are a special case.

And so I think

this is a fight that West Treaty has to win.

It doesn't mean he can't do some sort of deal at the edges, but you can't give in again on this one.

A little explainer on what I think I understand has happened is that 90% have voted to strike between the 25th and the 30th of July.

There were 11 separate walkouts between 2023-2024.

And that, of course, has a huge impact when doctors walk out.

You end up missing, you know, over a million healthcare appointments, ends up costing the government about a billion to try to fill in the gaps.

After the election, they got a 5.4% rise and then an additional 22.3% rise, starting salaries up nearly ten thousand pounds and now they're claiming another twenty nine percent and that that's what it would take to take them back to where they were in two thousand eight and they're saying they're saying it's non-negotiable and that's again is disputed again depends on how you calculate inflation because some people say actually they're only about four point seven percent worse off polly toynbee who i think would normally have been seen on the left just wrote an article in the guardian pretty much taking your position saying that she doesn't want to be silly but the pm salary is fifty seven percent lower than it was in two 2007 thousand and that even her sympathy for doctors is beginning to to wane a bit i mean i guess i guess where this where this goes to is the fact that we have had for some considerable time a pretty stagnating economy i fear that that's why ultimately unless we can get the economy growing properly these sorts of disputes are going to become more commonplace and that's why I think it would be pretty bad news if the government had to reopen a pay deal that they they thought had been settled.

So, I suspect what we'll see is a little bit about whether it's around conditions or some of the training, I don't know.

But it's a very tricky position to be in at a time when getting waiting lists down.

We're actually, I think, West Treaty and the Health Service are doing a good job, but that path has got to be continued right, you know, going for several years before the issue of health sort of gets out of its place at the moment, which is still right at the top of public concerns.

But I don't feel either in the vote or the manner in which they've been communicating since, I don't think the resident doctors are doing themselves that many favours right now.

But, you know, we'll see.

Here's my question on West Streeting.

I started by being very much supportive of his vision, which many people will remember as a kind of great vision of shifting basically from hospitals to community hubs, from treatment to prevention, and from analog to digital.

So the big idea that West Treating had, I think, is that to get better health outcomes and I guess by that that's a pretentious way of saying presumably what we're aiming for is that on average people in Britain are going to live longer, healthier lives.

In order to do that, we've got to move money away from getting people at stage three cancer.

It was quite a good example I think he gave when we did a leading interview with him.

If you can detect it at stage one, you can treat it much more effectively and much more cheaply.

So I was all with that.

But then suddenly he announced that the big target he was chasing is reducing waiting lists.

And I'm worried that's pushing completely the opposite direction.

Because it seems to me that there is a a pretty basic choice which is quite difficult to get around.

Either you are trying to make people live longer, healthier lives, in which case a lot of your money really is going into what we call public health, air quality, not drinking, not eating sugary foods, dealing with obesity.

Or you're trying to run a fancy healthcare system.

And those two things weirdly don't go together.

In fact, actually, there are people out there saying, Britain spends about 10% of GDP on health, that what we should actually be doing is spending 5% on hospitals and 5% on public health.

And actually, of the NHS party, we only spend not 50% on public health.

We spend 2% on public health.

And it's been cut cut even more, right?

So how do you get that 2% up to 50%?

Well, you could only do it by closing a lot of hospitals.

And every single, you know, this from having been a constituency MP, every single hospital, no matter how small, no matter how people have raged about it not being good enough or

the building falling to bits, people will always fight to save their local hospital.

But this is where I think the government, when I talk about having fights that are worth having,

actually thought I didn't read it when it came out but I've since read the Wes 10-year plan I actually agree with you I think that vision really works as a long-term vision where I think you're spotting the clash is that in the political imperative which is you've got to get these waiting lists down because that's the metric by which you're going to show at the next election look we said we were going to change the health service improve it and we have but meantime you're making a lot of change which are going to require a lot of fights including with the public actually because some of these things are going to require require public change in attitudes public change in behavior to get a long-term change but i think where i think he's absolutely right is the long-term change is fundamental and necessary let me give you a challenge then a communication challenge so here's a little figure so there were 780 people last year who died unnecessarily through poor practices and hospitals.

So

it's a difference of like a hundredfold.

100 times more people died from obesity.

And the first number, number, presumably, are many of them now involved in sort of litigation and the health service having to compensate and all of that.

Exactly, billions of pounds worth of compensation coming out of health services, et cetera.

But let's say you were given the mission.

And the mission was this, to say to the British public, look, if what we really want is for the British public as a whole to live longer, healthier lives, what we really need to put our money into is every stage of life.

So before babies are born, making sure that mothers are getting the right kind of vitamins and they're not smoking.

In the first five years, making sure that there's no childhood trauma, they look after their oral health, they're fit.

And then in later childhood, making sure that there's clean air, there's no junk food, there's good mental health.

And then once we become adults, making sure we're not living too sedentary lifestyles.

And then when we become older, dealing with loneliness, supporting people in the home, et cetera, right?

That's where the money should be going.

And if we did that, we could massively drive up life expectancy and health.

Okay, but here's your problem to communicate.

So

to do that, you would have to put probably actually tens of billions into public health and cut that from hospital.

And so what would happen is somebody like me, let's say I have a

heart condition, I go into hospital, and because of all the cuts to hospital, I die, whereas I wouldn't have done under the old system.

But at the same time, maybe 5,000 more people are living longer, healthier lives because the government is cutting down on obesity, supporting people in early childhood, helping them live healthier lives.

How do you explain to the public that one person they know has died unnecessarily because there wasn't the hospital care available, but thousands more people have lived because the public health?

I think we have to get away.

This is tough, but

I think as a communications challenge, I quite like it.

And I I think West Treaty would quite enjoy it as well.

Because we have definitely got ourselves now into a culture

where without really wanting to pay

for them through our taxation, we are expecting absolutely brilliant tip-top public services in every aspect of our life.

So I think actually, first of all, on the litigation side of things, for example, I think it's tragic that Britain has become this culture.

And I also, by the way, think it's leading to worse medicine because I think doctors are becoming, I've talked to doctors who told me this, you become more risk averse.

You become,

you tend to play safe, and that can actually mean not doing what might be the difficult thing, but the right thing in terms of medical care.

So I think arguing for that cultural change, can we please actually give a little bit more faith to our doctors?

Can we please give a little bit more faith to our healthcare system?

Can we stop spending all our time saying the National Health Service is on its knees, let's meet the challenges and let's meet them together?

So I think that was quite an interesting sort of, you know, national mission to speak up and stand up and save our national health service.

I think that was a good communications challenge.

And then I think on the other stuff,

because this is totally part of his thing about moving from, you know, cure to prevention.

I actually think

I'd love a campaign that basically said, and I'm probably upsetting people who may at times have, you know, paid me to advise them in the past, but I think actually saying

that, because we let's be frank, over time we have done it with tobacco, but actually to do the same in relation to junk food and in relation to alcohol, to say, look, you know, we can decide life's just all about having fun and having what I want when I want it, even if it's going to make me worse off health-wise.

But actually, no, as your government, you can call it nanny state if you want.

But I'm actually going to say, no, I'm sorry, if you're making all this money out of the foods and the drinks that are doing harm, you're paying it through tax, but also I'm going to create a public health fund and you're going to be part of it.

I could see that as being a very, very good communications challenge.

I'd enjoy that one.

It's weird, though, isn't it?

Because my clearest example of this was air quality, where I think our department calculated, let's say, that if we'd spent 300 million a year on cleaning up air in Britain, it would lead to something like two, three billion worth of benefit in terms of life expectancy.

So you were getting a return on investment of kind of tenfold.

And yet the Treasury would never do it because they didn't see it as a direct saving from the NHS budget.

And it's still not happened.

I mean, our air quality is still dreadful, and I don't see actually Labour putting the money into really making the radical change.

You would need to make air quality in the centre of Leeds or the centre of London what it should be to stop what are still tens of thousands of preventable deaths every year.

Air pollution in the UK estimated to cause between 28,000 and 43 deaths annually and worldwide at 6.7 million.

So 28 to 43,000 deaths annually.

But it is something to do with the way we calculate things.

I mean I suppose it's partly the moral hazard that maybe we think that somebody dying of preventable obesity, the 82,000 people who die every year from preventable obesity, that's somehow

their fault, whereas maybe somebody going into hospital after a car crash isn't their fault and therefore we expect the state to do one thing and we don't expect the state to do the other.

The second problem, I guess, is behavior change is tough.

I mean, it's all very well talking quickly about stopping mothers from drinking or smoking during pregnancy or sending people into an elderly person's home to nail down their carpet and get the right glasses prescription so they can read their medicine bottles properly so they don't end up in hospital or falling over.

But of course, any local council hearing that would just put their head in their hands and say, but you just don't understand how complicated and costly and difficult it is to change the behavior of a mother or get people in inspecting every old person's house to make sure they're not tripping over.

Yeah, 30,000 deaths a year that are put down to obesity.

Of course, the air pollution, the air quality thing is interesting though.

So I've had asthma all my life.

Right.

And you know, it's pretty well treated.

And

I don't have many really bad asthma attacks, but when I have them, they're really bad.

But I have actually noticed an improvement in London in recent years.

Now, that may be a change of medication.

But let's just say that when I die, let's just say that the

cause of death is put down as, I don't know, COPD, pulmonary disease.

Am I, would I then be included in these 32,000 deaths?

This is where the numbers get very, very difficult.

You know, I could argue that I've been, I've, I've died because I've sort of had asthma all my life, but I've treated it pretty well.

And therefore, you know, but then when I finally peg it,

you could argue that I'd be killed by air pollution.

So I think that, look, the stats on this are difficult, but I think that do we, is there anybody listening to this who doesn't think that Britain has an obesity problem?

I'd be very surprised if there is.

And I guess, is there anybody listening to this who doesn't think that, okay, maybe we're never going to get to spending 5% of GDP on healthcare and 5% on public health or 5% on treatment, 5% on prevention?

But I don't think there's anybody who thinks that we should be spending only 2% of the NHS budget on public health.

That can't be right, 2%.

I mean, even

the advertising, I see all the, there are lots of advertising.

I saw a big campaign recently, not least because, and by the way, why nobody has ever been to jail for the bloody MRMR campaign of a few years ago, including the editor of the Daily Mail and others.

You see, there was another death from measles.

But I noticed the big measles campaign recently.

I've noticed some big, I mean,

does that go down as public health?

I don't know.

I mean, I don't know where that 2% comes from.

That sounds really strange.

It's not just the UK, every country.

I mean, I'm in the US at the moment, where unbelievable amounts of money, huge amount of GDP is spent on the fanciest healthcare in the world, particularly for the wealthiest.

And yet, public health is terrible.

But

even in the Nordic countries, who are the real leaders on this, they haven't begun to get towards a 50-50 balance between treatment and prevention.

Final start before we go.

So, we said both obesity and air pollution in the sort of 30,000 territory, road traffic is about 1,700.

Suicide is nearly 8,000.

Yeah.

So, all of these things you can say that, but the truth is, these are all deaths that cost a lot of money in different ways.

But I think maybe we should get West Reating back on at some point and we should work on this communications challenge together.

But talk also more about tech and AI in relation to this, because it's right at the heart of the question of not just what tech can do.

Tech can do amazing things.

Devices can now monitor your health.

but it's to do with whether we're going to allow tech to do it.

I mean, I keep grumbling to you that in Cumbria, we only really got onto using the telephone in GP surgeries for appointments about 120 years after the telephone was invented.

So I don't know how quickly we're going to bring in AI.

Rory, I've got a question for you because nobody's been able to give it.

We'll close with this.

But you understand this stuff and I don't.

So

I went to Wimbledon the other day to the tennis.

And on the way in, I was with Grace, my daughter.

She decided that she wanted to get good content and she ended up getting really good content because accidentally we happened to be sitting directly in front of Leonardo DiCaprio and we weren't even in the royal box.

So anyway, en route in, Grace suddenly decides, you know, it's really hot.

I need to go and get some water and something to eat in case I get hungry.

We go to this food shop inside Wimbledon.

There's a woman, there are these barriers and there's a woman at the barrier and to open the barrier you have to put your credit card on the barrier.

Okay, so you tap the barrier with your credit card.

You then walk through and then I went over there and got a banana and a sandwich and a bottle of water and then Grace went over there and got something else.

And then we walked out.

And as I was walking out, I said, where do we pay?

And the woman said, you've already paid.

Right.

And I said, how?

And she said, it's something to do with the cameras.

So

what was going on?

I think a lot of different things could be going on, but my best guess is that they read your credit card number.

They didn't charge you at the point of entry.

they then managed to pick up remotely which items that you took through some sort of camera system and then debited your card on exit.

I mean, that's pretty fancy stuff if that's what they've done.

I mean, I

they did.

And did you and Grace get different charges?

It wasn't that you got the same charge close enough.

It was one card.

We went through on one card and went to different parts of the shop.

Yeah, well, that must have been what they're doing.

It's something that supermarkets often talk about.

I haven't seen it done at scale yet.

Oh, there you are.

I'm ahead of of you on AM.

Yeah, that's good.

That's

fancy stuff.

And my goodness, look, if we were, but of course, the problem in health is that we're not comfortable yet really sharing data in a way that would allow a lot of this incredible benefits to come from looking at.

Listen, having looked into Mr.

Peter Thiel of Palantir fame during our discussion of JD Vance for our mini-series, do we really want him to get any more of our data than he's already got?

Well, that's a good segue, Alistair, to end, because we, of course, discuss a great deal about Peter Thiel in our J.D.

Vance series.

We are doing a special Q ⁇ A this Friday on The Restless Politics Plus off the back of our four episodes charting the rise of J.D.

Vance.

Thanks to the Radio Times for the lovely review, by the way, an invaluable primer on the most complex personality in US politics.

So if you have any burning questions on J.D.

Vance, maybe something we've missed, and it could be more on Peter Thiel, something extra you want to know, just sign up to the restlesspolitics plus at therestlerspolitics.com and follow the link at the top of your welcome email.

And just to get people up to speed quickly, on the fourth episode, we're right into his time now as vice president and focusing on what we've learned about him from his famous speech at Munich, from his spat with Zelensky, from his ups and downs with the Pope, and also he had a little bit of a contraton with Keir Starmer as well.

So I've really enjoyed making it and I hope you've enjoyed listening to it.

And those who haven't, I hope you will.

What we've got into is whether a potential J.D.

Vance presidency, which isn't impossible by any means, could be even more dangerous than Trump 2.0.

We do a little explainer on the history of the vice president, which I claim to have read 10 books for.

I think you'll find you re-read at least five of them.

Anyway, if you want to hear the first four episodes in full right now, get up to speed before the QA, which is this Friday, head to therestispolitics.com to join The Restis Politics Plus.

Takes two minutes to sign up, and you get the member feed synced straight up to your preferred podcast platform.

So here's a little clip from episode four.

Vance in a 2021 interview says, we are effectively run in this country by a bunch of childless cat ladies.

This Zelensky showdown in the White House.

It's not normal to have a vice president sitting in there and interrupting.

I thought it was utterly utterly disgusting.

That was Vance showing, I will be your attack dog.

This is a guy who's had a pretty rough life, pretty rough childhood, and meanwhile, he has a level of ambition that makes him prepared to do or say anything in the moment to get to the next step.

And the next step for him is the White House.

Take that lack of virtue, that lack of moral character, and combine it with the economic and military might of the United States.

And you should be very, very worried about a JD Bance presidency.

So if you enjoyed that and want to tune in to all four episodes and get Friday's QA, sign up at theresterspolitics.com.

And you get the full trip plus experience.

Mini series like this, member bonus content, completely ad-free listening, much, much more.

Just go to therestispolitics.com.

So Rory, see you tomorrow for question time, which is not the same as a Q ⁇ A.

And we're going to be talking, I think we're going going to have a very big discussion on Israel and the reaction to our discussion last week.

Maybe a bit on Macron and his visit here.

What else do you want to talk about?

I'd like to talk a little bit about Spain.

Gosh, there's so much going on a lot.

It's going to be exciting.

Let's push it all into the question time tomorrow.

See you then.