The challenges and opportunities of securonomics

At a recent Wonkhe event, University of London Pro-Vice-Chancellor Partnerships and Governance Alistair Jarvis, Founding Partner at Public First Rachel Wolf, and I discussed Labour’s economic plans and their impact on universities.

The discussion ranged from growth, to regional development, and Labour's central economic idea, securonomics. This is a term coined by Chancellor Rachel Reeves that combines national economic security, think supply chains, infrastructure investment, and onshoring, with individual prosperity, in order to withstand the financial shocks of an uncertain world.

Economic patriotism and its discontents

Although the idea is new it is close to an idea promoted by US Democratic Senator Elizabeth Warren. In her 2019 run for the Democratic Party nomination for President she proposed an idea called economic patriotism. In a Medium post Warren described the idea as having seven key planks:

• Placing the interest of workers above the interest of capital
• Using tax incentives and regulations to onshore jobs
• Consolidating public bureaucracy to more efficiently promote job creation
• Building out manufacturing and encouraging exports
• Increasing R&D investment and spreading the benefits of R&D to more regions and taxpayers
• Scaling up apprentices and skills programme
• Using government spending to stimulate national industries

Economic patriotism has popped up as a concept covering everything from Reagan increasing defence spending, Obama encouraging American businesses to pay tax in the US, and the far right in France rallying for investment in agriculture. Like securonomics, its loose definition allows the term to be used by almost anyone to mean any version of national investment.

The challenge to economic patriotism is that in a globalised economy countries can only go so far on their own before harming their own economies through diminishing trade, investment, and partnerships of all kinds. The similar challenge for securonomics is how the UK, with its now modestly sized economy, should build economic independence without damaging the international relationships it relies on for growth.

Securonomic(s)

For universities, an economic policy framed on patriotism and the nation state raises questions on the balance between using taxpayers funds to train a domestic workforce and attracting the best and brightest minds across the globe. It challenges the extent to which R&D funding should be used exclusively for national projects or collaborative ones. And it will challenge the nature, depth, and dynamics of university international partnerships.

It is also a challenge for the Labour Party which is trying to square a pro-growth and pro-distribution agenda. There is a strand of economic thinking which is squarely focussed on the state intervening to redistribute wealth. This is best exemplified by the likes of Lisa Nandy who in her 2020 leadership pitch went much further than the current leadership in calling for the taxation of land, property, and shares at the same rate as income. The current chancellor Rachel Reeves has not yet ruled out raising capital gains but whether it is on podcasts, lectures, or newspapers, her single economic message is that growing the economy with business is the only means to improve prosperity generally.

The most pro-distribution version of securonomics is about individual quality of life and the resilience of regions to withstand global economic shocks. For example, the development of sustainability projects is not only about international leadership but the reinvigoration of once industrialised regional economies. The most pro-growth version is about deregulation and the liberalisation of planning. A good example is Energy Security and Net Zero Minister Ed Miliband in describing his energy policy links international missions, national resilience, and individual prosperity saying the government will “[...]take back control of our energy; boosting our energy independence and cutting bills for families as we tackle the climate crisis.”

Which version of securonomics emerges leaves different challenges for universities in squaring their international partnerships, recruitment, and research, with a more independent nation state.

The state universities are in

As I’ve argued elsewhere on Wonkhe Labour’s election does not mean that universities should relabel everything they do as securonomics but there is a question in how universities balance their international and national commitments.

It does not mean universities have to be at the centre stage of every national story but it does mean anticipating a few policy trends. One is a greater focus on regional strength through state interventions. Largely in the form of industrial strategies. This will place the focus, again, on regional R&D and wider issues like local supply chains, procurement, skills and employment.

Electorally Labour cannot afford to look soft on defence so there will be continued focus on international partnerships and risk. There is not as yet a single coherent narrative on why universities choose to work with who they work with. For example, as a sector, it is difficult to maintain a position that it is improper to work with countries that invade others but it is not a red line to work with countries where there is credible evidence of human rights abuses.

And in line with a broader agenda of economic patriotism there is a question on universities as exporters of services and drivers of inward investments. The ability to articulate these arguments is not only important to the economy but also important to student mobility which is partially preserved and fought for through an articulation of its economic benefits.

Perhaps the most significant shift is attitudinal. The previous conservative governments swung between directed state investment in projects like levelling up under Boris Johnson to ultimately disastrous free market ideology under Liz Truss. Like economic patriotism, securonomics embraces growth but with conditionality. And those conditions are that growth should also strengthen the UK’s resilience. Economic policy does not see the state as an actor of last resort but a partner in growth. Globalisation is necessary but has limits particularly where it runs counter to national interests. And the redistribution of wealth is not only a necessary precondition of social justice but economic resilience.

The opportunity for universities is to contribute to a national mission through being reliable partners in their places, promoting individual prosperity through being good partners and employers, and being responsible and reliable custodians of the UK’s wider international mission.