Dear Subscribers,
America has sneezed and we’ve caught a cold. The release of the Epstein files has shaken Starmer’s government to its core. Thousands of email correspondence between Peter (Lord) Mandelson have emerged. In the most damning correspondence Mandelson was lobbying government ministers on Epstein’s behalf to amend the bankers’ bonuses policy and leaking to Epstein the minutes of meetings between Alistair Darling and Larry Summers when he was Brown’s advisor. Thus, Mandelson has been the subject of non-stop attention this week: his Labour party membership was resigned, his peerage revoked, his properties raided and ties with his lobbying firm cut.
In response, Starmer gave a typically pained and strained speech on Thursday. He was tieless, his shirt and suit dark and his backdrop Spartan to express the gravity of the situation. ‘Mandelson’ and ‘Epstein’ were spoken of by last name only and Starmer’s ignorance of the ‘darkness and depth’ of their relationship was professed. For most of his premiership, Morgan McSweeney has been behind Starmer; he was also behind Mandelson’s appointment as US ambassador. The Telegraph has shown how McSweeney had been connected to Mandelson for years. There are growing calls for McSweeney to get the sack.
Earlier in the week, it was reported that Trump was expected to approve the Chagos deal. But Trump’s Truth Social post – ‘I understand that the deal Prime Minister Starmer has made, according to many, [was] the best he could make.’ – was not necessarily approval. There was a condition: ‘if the lease deal… ever falls apart, or anyone threatens or endangers the US operations and forces at our base, I retain the right to Militarily secure and reinforce the American presence in Diego Garcia.’ Such a condition brings into question whether the government’s current terms make the deal untenable.
In more local matters, Reform UK unveiled Dan Thomas as its leader in Wales. Thomas is of Welsh origin and had previously been a Conservative councillor, defecting to Reform last June. Following this Reform won a council by-election seat from Plaid in Anglesey with 43.9 per cent of the vote. In opposition to the government, Kemi Badenoch has had a strong week, capitalising on the Mandelson crisis at PMQs and with her own press conference. There are also rumours that she will shift her shadow cabinet rightwards.
Lastly, while the news cycle has been dominated by Epstein, a groundswell of social and financial issues have hardly been mentioned by the mainstream media. Despite the obsession with Epstein’s child-sex trafficking, there has been no reporting of Rupert Lowe’s ‘Rape Gang Inquiry’ which began this week. From another direction, there has been coverage of the Student Loan Company’s failure to track over 370,000 graduates who owe almost £13bn – figures obtained by Rupert Lowe.
Blog
An American Economic Renaissance by Robert Lee
America’s supply side economic recovery is being driven by fiscal discipline, productivity growth and re-industrialisation. With new leadership at the Fed and Treasury, the US offers a clear policy template the UK is ignoring.
Media
Rod Liddle in The Spectator: I was right about Peter Mandelson
Jonny Ball for UnHerd: The end of Starmerism
Tom Jones in The Critic: Starmer, man of sleaze
Key Points
Starmer and Mandelson
The Epstein affair has yet further undermined Starmer’s leadership. Those on the Labour left are keen to see McSweeney go: but were he to go, would Starmer lose the last pillar of his authority? McSweeney has exerted considerable influence on Starmer’s government, especially on immigration. This is what the Labour left pejoratively call ‘out-Reforming Reform’. The rightward drag under Sweeney has meant there has been a long-running ambition to see him gone amidst the Labour left.
But were Starmer to fall, who takes his place? For continuity, Wes Streeting has intermittently been rumoured to be vying for leadership, but his past idolising of Mandelson have damaged his prospects. As the antithesis to Starmer, Angela Rayner has backbench support – but surely her reputation is too injured by the stamp duty avoidance which led to her resignation. An unknown candidate is Al Carns, a marine and parliamentarian since 2024, Under-Secretary to the Minister for the Armed Forces. But it seems implausible for someone so little known to rise above the likes of Streeting and Rayner this quickly.
Starmer might just cling on. Despite what is said of his wooden rhetoric and general greyness, he is a deeply cynical politician. Indeed, Starmer’s is a Mandelsonian cynicism: the capture of the Labour party from beneath Corbyn’s feet, the dizzying u-turns in office, always tactless, but aimed at the preservation of power nonetheless. Whether Starmer can articulate such cynicism as Mandelson is highly doubtful. Witness Mandelson on the ‘rules-based order’ from The Times’s interview a few days ago:
“Where were the clear rules?” he asks. “The global rules we once had have long since been overtaken by American rules, by Chinese rules.” It’s bunkum, he says, to believe in a Camelot that Trump has somehow defiled. “A liberal world order where peace ruled supreme? It didn’t. Understand that hard power — and occasionally lethal force — is needed to keep us safe. Not dream rules.”
Starmer could never come out with something like that. But his cynicism finds its expression in his actions. His willingness to give a speech about an ‘island of strangers’ to then capitulate and express his regret. Or take the ease in which he positioned himself as a Corbynite to then bury the Labour left in order to win a parliamentary majority.
Starmer’s tactlessness might be explained by a kind of hubris, which has also characterised Mandelson’s conduct. Indeed, we might relate the same hubris to McSweeney’s appointing Mandelson, with knowledge of his ties to Epstein. If we are right to call it hubris, then how long must we wait for nemesis?
