Why North England is poor.

Tom Forth, 23 January 2025 (in summary), 25 January 2025 (in detail) and 26 January 2025 (with links)..

Buying an old and neglected house in Leeds and working on its renovation for two years has increased and broadened my podcast listening. A series that has provided the soundtrack to stripping the stairs and priming the window frames has been Conversations with Tyler.

For a decade, American economist Tyler Cowen has interviewed people on a wide range of topics. There is a heavy skew — especially in the episodes I select to consume — towards America and Britain and towards discussion of economics and prosperity. The episodes are fast-paced and Tyler’s questions are well-prepared and incisive.

This blog post is split into two parts. A summary and a detailed expansion. Links to blog posts, references, and episodes of Conversations with Tyler will be added in the coming days.

In summary

In at least six Conversations with Tyler, Tyler Cowen asks his interviewee why they think North England is poor. I don’t think he gets good enough answers, which I guess is why he keeps asking.

So here is a better explanation of why North England is poor with a bonus explanation of why so many Britons think much less of Margaret Thatcher’s Premiership than he and his guests do. It is a heavily simplified and selective story, but I think it tells the key parts of how North England fell from being the birthplace of the industrial revolution and among the richest places in the world two centuries ago to being an economy substantially lagging everywhere else in Northern Europe today.

The North’s economic decline is made even clearer when it is compared to two near neighbours and far more prosperous counterfactuals. Scotland and Ireland, who have achieved greater independence within and from the United Kingdom, and whose success is awkwardly ignored and denied by the people responsible for the North’s decline, are today far stronger economies than North England.

I will publish my expansion of these points in detail as soon as I can, but for now I offer this summary,

1. The Norman conquest.

Since at least 1066, England has been ruled from the South East for the benefit of those who rule it and the places where they live and work.

2. Ban on Northern universities.

In the 1600’s, and for two centuries after, England and then Britain’s overwhelmingly and disproportionately Southern Parliament in Westminster rejected North English requests to establish universities in the North. The outsized influence of members representing Oxford and Cambridge and graduates of their universities played a big role in this. The Parliamentarian victory in the English civil war was working on the problem but the Monarchy was restored before Northern universities were established.

3. The industrial revolution.

The lack of universities in North England meant that the industrial revolution was heavily powered by Scottish science and largely occurred at a distance, both geographically and culturally, from London and Westminster. It was this distance that allowed North England to prosper through industry, despite constant effort by British national institutions in South East England to constrain their success. And it was the competition of ideas across that distance that led to great Northern social ideas such as Manchester Liberalism, an end to the Corn Laws and more free trade, professional sports, and a fairer democracy eventually triumphing nationally.

4. Universities were allowed too late.

North English universities, although quickly successful once they existed, were permitted too late (1880 for Manchester). They could not quickly enough achieve a critical mass of high-skill and elite institutions in North England that would help the economy to retain a technological advantage or transition to higher productivity service activities when Britain’s industrial advantage started to decline.

5. Grouping, nationalisation, and privatisation destroyed the North's institutions.

North England’s strongest local institutions were born of the industrial revolution and included the railways and the municipal corporations. Alongside wealthy local industrialists, municipal corporations built and municipalised gas, electricity, and water networks, healthcare, education, and social housing systems and much more. These service and assets were taken out of local control and run overwhelmingly from Westminster as they were grouped, nationalised, and privatised by UK governments of both left and right from the 1920s onward.

6. Thatcher and the end of competition of power.

The process of transferring assets and power from local government to central government or to the private sector (regulated by central government) was substantially completed under Thatcher. Major changes included the abolition of metropolitan counties in the North’s great cities, the removal of most remaining local taxation powers, the removal from local control of the Mechanics’ Institutes and Polytechnics (the North’s locally-created alternative to the Universities they were denied during the early industrial revolution), the privatisation and deregulation of local bus services, and the introduction of right-to-buy forcing local governments to sell their largest asset base and source of income at well below market rates and give a portion of the proceeds to the central government.

Absent any of the protections against it that exist in the US constitution, Thatcher moved the British state past the French state into being the most centralised in the developed world. "You can just do things" is an emerging meme in the pro-growth community in London, but since Thatcher that has been largely untrue in North England. Most of the time, someone from central government will block you, if you succeed they will try and stop you, and if you continue succeeding they will subsidise your competitors.

7. Ultra-centralisation of the state.

Since Thatcher there has been no effective local counterbalance within England to the UK government’s power held in Westminster, no right for cities or regions within England to raise taxes to fund investment in growth, and no limit on the power of the UK central government to constrain growth in the North. The UK central government, backed by Britain’s national institutions, has intensified its preference for South East England. Britain’s government and institutions have moved Britain’s science and innovation from the rest of the country to the South East, focused on London, Oxford and Cambridge.

The central government, holding the monopoly power on such investment, has invested heavily in transport infrastructure in, around, and to London and almost nowhere else in England. The development of a competitive agglomeration to London in North England has been deliberately constrained almost continually. These patterns have deepened even while central governments claim to be focusing on regional investment. In the last fifteen years, while the UK government has claimed to be moving power out of Westminster it has centralised its civil service, centralised its investments in R&D and transport infrastructure, and moved an extra million employees from local government control to central government control.

8. A new generation of policy thinkers.

A new generation of British national policy thinkers, policy advisors, politicians, and custodians of Britain’s national institutions now live almost none of their lives outside of South East England. They rarely have a memory of, or interest in, an England that is not ruled overwhelmingly from the centre.

While arguing for growth today these people and their organisations repeat the mistakes that Thatcher cemented in British political economy thinking that a well-managed central monopoly on power is better than a competitive dispersal of power. They celebrate new scientific institutions in London such as ARIA that repeat — against strong evidence that it will not deliver greater returns in doing so — the centralisation in the South East of England of our national research capacity.

We are repeating today previous disasters for the North’s economy such as the relocation of Britain’s synchrotron to Oxford, the relocation of AstraZeneca to Cambridge and London, and the centralisation of biomedical research in South East England with the construction of The Crick Institute. Our institutions celebrate the creation of new "national" organisations in the South East such as The Open Data Institute, Nesta, GDS, Tech City, and the AI Safety Institute that employ large numbers of well-paid people in the capital. At best these organisations allocate their money with preference to South East England and represent local interests as national objectives. At worst they actively oppose and shut down success elsewhere in the country.

This all happens largely without malice, though prejudice against people from "the regions", while greatly reduced, remains rife within British high society. It is the result of England having forgotten, and — embarrassed by the comparative success of Ireland and Scotland having rejected this centralisation — not having taken the opportunity to remind themselves of the power of competition and markets in government.

9. Why Britain can't afford to carry on as it is.

I have now spent the best part of two decades helping to build successful businesses and organisations in North England. Organisations and companies that I help run and work for consistently beat competitors in the South East who benefit from the support of a generous and powerful central government biased towards their success and not mine. And despite the gloom in this piece, I retain some optimism that things can improve and that continuing to make the case for that improvement is worthwhile.

Limited success such as in Manchester, whose economy has nearly kept up with East German cities while the rest of North England falls behind, shows that strong local leadership can convince the British state to treat the North less badly. And we see that given even slightly reduced dispreference from the centre, or a release of constraints on growth from the centre, the North can do well.

I also know that the North cannot be ignored. The British state cannot afford the large and increasing fiscal transfers needed to maintain national public services which the South demands in a North whose economy is so weak. There are simple and proven actions that would change the trajectory of Northern growth and boost British prosperity. I have faith that the British government and institutions in the South East of England will do the right thing once they can no longer afford not to.

 

 

In detail

I begin with two apologies.

First, I am sorry to the people of South England. I know from giving talks on these subjects and having written about these issues before that many of you take personal offence to what I mean overwhelmingly as institutional criticism. If I included all the important caveats like “there is of course poverty in the South too, just as there are pockets of prosperity in the North” and “the standard of living is hardly higher in the South given high house prices” and “it’s not as if any more than a handful of people of the South were electing the Southern MPs and Lords” at every position where they would diffuse upset, this essay would be ten thousand words not seven thousand. I am sorry, and I hope you see that I am writing on the advice of Ice T to not hate the player, but instead hate the game.

Second, I apologize in advance for the geographical crime I’m about to commit. I am going to draw a line from the Wash to the Severn and annexe the industrial Midlands of England in the name of the North.

We already speak alike and serve our beer in the same way and I think we are close allies on these issues.

But having lived in Birmingham for nearly four years I understand the pain it will cause in that city, in Coventry, and in the Black Country to be lumped in with us. I apologise additionally to the people of Nottingham, Derby, and Leicester.

When Tyler talks about why North England is poor he is including you with us and indeed much of our story is shared. The missed opportunity for The Lunar Society to become a cherished national institution merits its own blog post, but it should be written by someone in Birmingham, not me.

Poorer than Poland.

I’ve written dozens of blog posts over many years detailing the economic underperformance of North England, how the UK government perpetuates that underperformance, how in similar circumstances Scotland, the Netherlands, and two similar parts of Germany have done much better.

The graph below is to remind us of that context.

North England was 120 years ago just about the richest place in the world. Today it is very poor by North European standards. If it didn’t receive such generous transfers from England’s prosperous South East (the regions containing Oxford, Cambridge, and London) it would be even poorer still. The primary economy of this North, especially its cities, is astonishingly weak and has long been painfully slow growing.

East Germany overtook us over a decade ago, Poland probably overtook us in the last couple of years, though weak regional data within England and our decision to leave Eurostat following Brexit make it hard to know. The challenges of purchasing power parities, especially when applied to regional economies, especially when large fiscal transfers are involved, will leave it arguable for at least a decade.

I do not want to only describe the problem. I also propose solutions. They are largely unchanged in two decades since I started writing on this topic and are unchanged for many more decades in the writings of dozens of other North Englanders. Britain’s government has just never tried them, while bizarrely protesting that it has.

My three steps for how North England could grow the strength of its economy by somewhere between the 20% above trend it would need to equal Scotland or East Germany and keep up with Poland, the 40% above trend it would need to equal North Rhine Westphalia, its most similar post-industrial region in Germany, or the 60% above trend it would need to equal the Netherlands remain simple.

1. Shift UK national public infrastructure investment to urban North England where it will generate higher national returns by joining up the North into a collection of functioning agglomerations.
2. Shift UK national public R&D spending to North England where it will more closely match the distribution of private sector spend and drive a new wave of British innovation and growth, especially in the private sector.
3. Decentralise or relocate government and power within the UK. Ideally this would happen by shrinking the central government and returning tax and spend powers to local and regional governments so that they could lead on requirements 1 and 2. But since this is so deeply and emotionally unacceptable to so many South East British conservatives we may have to do it by moving much of the central government North.

In many other blog posts I have shown how the data does not support common excuses for North English underachievement such as poor education, poor health and low genetic IQs (astonishingly this remains an acceptable topic of discussion in polite company and published science in much of Britain) — what Tyler refers to in his interviews as “a human capital crisis”.

Another excuse for North English underachievement I often hear is that the North is too disperse, has no large cities, and what cities it does have are too low density to achieve agglomeration benefits. I have built a number of tools to show that this is not consistent with the data.

The most promising area for North English growth is a 100km radius circle containing five major metropolitan areas with similar populations and populations densities to cities like Amsterdam and a total of 20 million people.

This red circle has the same population as the most expansive definition of London and its commuter zone but its economy is barely half the size. There is no denser circle of population in Europe except London. Only New York, Los Angeles, and Mexico City top it in North America. This is a dense urban concentration that could easily be a functioning collection of agglomerations.

Using this and other tools we can see that the North’s cities are not small, either individually or in sum. Nor are they low density, except in as much as awful transport infrastructure makes them extremely difficult to travel within and between. In addition to showing that human capital is not the major barrier to North English economic growth, fantastic work by Anna Stansbury at MIT has shown this convincingly, building on my earlier work. It is no surprise that Anna has achieved greater insight into North English economic underperformance outside of Britain than within it. I find that Tyler, similarly, shows more insight than most people who live and work in South East England.

Why is the North poor?

I love Tyler’s question, and I don’t think he’s yet got a good answer.

That’s partly because, on his podcast at least, he’s not asked any of the 25 million people of North England. There is almost no-one in the blue circle who has a good answer, no matter how much they protest that they do or how relevant a third of them think that the eighteen years they spent growing up in the North England leaves them qualified to comment on its future now that they have left. And it’s partly because the answer is quite an expensive one to give in terms of status, income, and perception by those close to the large and growing British state and its national institutions.

Northerners with a good answer for Tyler and wishing to avoid looking too conspiratorial will avoid talking too honestly, too seriously, and in too much detail about the root causes of why the North is poor.

But I run my own businesses from which I can’t easily be fired (though plenty try), we’re doing well and growing quickly, and I don’t need an academic position, a job reference, an event invite, or a show on national radio. I can afford to write pretty much what I like.

So here’s a longer version of why I think North England is poor, with reference to some relevant episodes of Tyler’s podcast and with some links back to the summary I put at the top.

1. and 2. 1066 and Universities.

In his conversation with Tyler, Simon Johnson, originally from Sheffield and now in the USA, flippantly suggests that the Norman Conquest is to blame for the North’s weak economy today. There is some truth to this, as Tyler is quick to note. Simon’s flippancy is part of the desire to avoid looking too conspiratorial I mentioned earlier. He’s right, but he’s learned not to say it too seriously.

England’s King Harold had in early 1066 expelled the Danes from North England, decisively winning the battle of Stamford Bridge, a village just five miles from where I grew up and for whom I played kids football.

A few months later, Harold’s life and reign would end in defeat to Norman French King William the Conqueror at the Battle of Hastings. In the following decade England’s new King William’s harrying of the North decimated the population of potentially-rebellious North England and destroyed much of its wealth. Genocide is probably too strong a word, though some have used it.

But a millennium is a long time, and more recent historical events of this pattern matter more because they set North England on a much more damaging economic path.

In the 1600s, the North English cities of York, twice, and Durham, once, asked the King and/or Parliament for the right to establish Universities. Their grovelling petitions are fun to read and worth your time. They show just how subservient the North English needed to be to be listened to in their national parliament in the South.

This requirement for grovelling has greatly reduced over time, but still remains. I already know I will, for I always have in the past, receive feedback on this blog post from the South suggesting that I show more respect for Britain’s institutions and experts, blame others less and be more constructive on ways forward, and find a way to work together for the greater national good. British institutions usually invite me to London to be told this, which is one reason I so rarely go.

The North’s grovelling petitions were rejected each time under strong pressure from representatives of Oxford and Cambridge, whose universities each received two dedicated MPs in the House of Commons until 1950. Today South East England has its two ancient Universities in Oxford and Cambridge while Scotland and Ireland have five between them. North England has none.

“If you want to build a great city, create a university and wait 200 years” the saying goes, though I don’t think the lesson translates well from the American federal context to the English centralised government context. But if it does, York will be waiting a while to achieve greatness having only been finally allowed to build its University in 1963. Durham shows no sign of lifting its surroundings from poverty as it approaches its two hundredth anniversary.

This pattern of South East England asserting dominance by weakening the North occurs frequently in British history and is still common. We’ll return to it after the industrial revolution.

3. The industrial revolution.

Industry had been stumbling along for a century or more but it was when the Stockton to Darlington railway in County Durham began operating in 1825 that North England really changed, and the world quickly changed with it. Soon the original modern city of Manchester was connected to one of the busiest ports in the world at Liverpool. From Birmingham to Glasgow the industrial revolution had accelerated to full pace. The trend rate of British growth had changed forever and the graph of British GDP turns sharply upward in precisely 1825.

For a brief period, North England was near enough the economic equal of the South. The tragedy for the North is that this did not persist through the decline of industry. Part of the blame for that is the lack of North English universities.

In his conversation with Paul Graham, Tyler talks about the industrial revolution and the split between the North’s industry and the South’s ideas.

“Tyler: The Industrial Revolution happens further north, but the ideas, the science, in or near London, maybe Cambridge. Paul: And Oxford.”

There is much truth to this, largely for the obvious reason that North England is still prohibited from having universities by the British Parliament.

Oxford and Cambridge are the two permitted universities of England and organisations such as the Royal Society and Royal Institution with royal charters provide state-sanctioned forums for the promotion of science in London.

But this does not mean that North England’s industrial revolution relied on ideas and science from the South East. North England’s industrial revolution was powered by North English engineers and substantially by Scottish scientists such as James Watt from Glasgow and its university.

Nor did the North’s industrial revolution rely on Southern money.

In their conversation, Mark Koyama notes that “one noticeable thing about the English Industrial Revolution is it doesn’t occur in a political centre. it occurs in the periphery, in Manchester, Yorkshire, Birmingham, Derbyshire” and that “London has a sophisticated banking sector, but the London bankers are not financing the Industrial Revolution. They’re being financed out of savings”.

Even more than being at first unaware and then uninterested, much of the British establishment in South East England was deeply negative about the industrial North and its inventions. Queen Victoria was infamously repulsed by the Black Country, North West of Birmingham, and England’s de facto national anthem Jerusalem refers to “dark satanic mills” not fantastic wealth-generating mills.

New ideas coming from the newly rich North threatened social order and the establishment yielded as slowly as they could. The chartists and the suffragettes pushed for and eventually won the right for MPs to represent more or less equal sized constituencies (until 1832, the City of London had four MPs while Birmingham, Manchester, and Leeds together had none) elected by both men and women from a broad section of their societies in secret ballots. The Labour Party grew out of Glasgow and Bradford and rose to be the second power in British politics.

Against great protests of Oxford and Cambridge, the British Parliament finally allowed a third university in England. London first, of course, in 1836, and then Durham in 1837. Even Manchester eventually won that right in 1880.

This competition of societies within Britain led to great Northern social ideas such as Manchester Liberalism, an end to the Corn Laws, free trade, professional sports, and a fairer democracy eventually triumphing nationally. The North is rightly proud of the huge legacy it has of making Britain and the world better. I take great pride in the statues of Bright, Cobden, and many others that stand in the centres of North England's cities and towns.

Local power in the North also created great municipal innovations ranging from Newcastle’s excellent electrical system, Bradford’s pioneering waste system, and Birmingham’s exceptional (except for the Welsh villages flooded to create it) water supply. We’ll return to that in a bit.

4. The hierarchy of Britons.

The North’s rise was not to last. Britain’s national institutions were always working to grab back power as soon as they got the chance.

In his interview with Roy Foster — an interview which to most listeners, and possibly even to Roy Himself, seems completely unrelated to North England — and as part of a discussion on why Ireland was treated substantially worse than Scotland within the Union, Tyler asks if there was ever any hope of Ireland remaining United and within the United Kingdom.

Roy Foster: “The theory of the Act of Union between Ireland and Britain was that Ireland would be treated as any other part of the United Kingdom. The fact of it  —  when Irish people starved and died in their hundreds of thousands, and indeed millions, during the Great Potato Famine of the 1840s  —  was that they were not treated as if they were “any” part of the United Kingdom.”

This is true. There was a hierarchy of Britons in the eyes of the British state and its institutions. The Irish were at the bottom from the moment they joined until the moment they died of famine, emigrated in despair, or saw their country achieve independence.

In these histories it is often written as if it was the English who were on top, but, as so often when treating the English as a homogenous whole, this leaves unsaid that England had a hierarchy of its own.

Using the number of MPs in Parliament per 100,000 population, we see that, as always, it is the South English on top, with the North English closer to the Scots and Irish.

No understanding of North English poverty today can separate itself from the founding hierarchy of our nation which is visible in the data nearly eight centuries later. This imbalance is today fixed in the Commons, though the hierarchy of Britons which it betrays has simply shifted to unelected parts of Britain’s institutions. This is most visible in the House of Lords which remains an overwhelmingly Southern part of our Parliament.

And it is the House of Lords that Roy Foster brings up later in their conversation,

“The other great missed chance is in 1886, when Gladstone converted himself and a large part of his ruling Liberal Party in Britain to the cause of Irish home rule … they did reject it, the House of Commons. They passed it a few years later, but it was rejected by the House of Lords.”

The rest is history as regards Ireland. But another event in 1886 tells us even more about the hierarchy of Britons, its contribution to the end of that Union, and hints at an alternative that could have saved it.

4a. Rugby and what it teachers us about an alternative history.

The game of Rugby was run from London, having been invented in England, and the four nations of the UK had been playing regular international matches for about a decade. But when in 1884 England and Scotland disputed the result of a match on an interpretation of the rules, England’s resolution was to say that since they set the rules of the game, they were right. This was typical, and typically unwise.

Scotland refused to play England in 1885. In 1886 Ireland, Wales, and Scotland met in Dublin to agree to form their own governing body of Rugby, and in 1887 the three countries, England did not attend nor would they play the other home nations until they conceded defeated and joined the breakaway code in 1890, met in Manchester to write the rules.

Manchester is of course in England, so it may seem odd to many that the three breakaway nations met there. But Manchester is not in the same England as the England that ran Rugby. If you need more proof of this you should know that within a decade the North English rugby clubs would themselves split from the South so that they could play professionally in a Rugby League, cementing against Southern outrage the existence of one of the UK’s most lucrative industries today: professional sports leagues.

Manchester was in England, but it was felt to be a different and a neutral England by Wales, Scotland, and Ireland. It was and is substantially free of the worst of the attitude of superiority and the denial of self-preference that come from the South East. To this day I and other North Englanders are excused, often awkwardly after the fact, from rants by the Irish and Scots in pubs after events about “the bloody English”. We are rarely who they are complaining about.

I am convinced that a United Kingdom that had taken similar steps to Canada (Ottawa), Australia (Canberra), the USA (Washington DC), and Nigeria (Abuja) of putting its capital on neutral territory would have stood a good chance of remaining United.

This did not happen. It would never have been acceptable to the South East, as it almost certainly remains today.

Things would soon change. After nearly a century of losing, the centre of power which remained in the South East, would start winning its battles.

5., and 6. Grouping, nationalisation, privatisation, and the centralisation of all government under Thatcher

The First World War, its slaughter of Europe’s young men, and the distraction that caused is part of Ireland’s path to independence. I’ll leave holding much of an opinion on that to people like Roy Foster.

More to my interest, it was also a path to the centralisation of power in Britain and the restoration of a South Eastern order that the industrial revolution had disrupted.

It began, as the flourishing of the industrial revolution had, with the railways, which had in themselves made travel within England easy enough that the North could be governed in absence from the South.

Britain’s railways were large institutions that remained substantially Northern. But as part of the war effort and to make sure that munitions and supplies from the industrial North could efficiently make their way to the front lines, they were put under national government control. The taste of power was too seductive and in 1921, rather than return them to local private control, the UK government decided to combine almost all of them into four groups, all headquartered in London. Full nationalisation of the railways from 1947 would finish the job.

The other powerful institutions of the North were the municipal corporations. With national government largely absent from the industrial North, the horrendous conditions that Marx and Engels described in their books had been substantially ameliorated by new, wealthy, and powerful local governments. They built and municipalised gas, water, electricity, tram, and bus networks and created health, education, parks and recreation, and waste services. They built and maintained roads, and accelerated the building of houses, offices, and factories along them.

The grand city and town halls of North England (a formal “city” in England can only be created from Westminster and by the Monarch, so the North has fewer than it merits) are a testament to the power, prosperity, and Victorian spirit that used to exist in these places. That the city halls are often run down and used for paid concerts and events rather than governing their cities is a testament to what came next.

Following the second world war, in the 1940s (healthcare, transport, and electricity) through to the 1970s (gas and water) the functions of the municipal corporations were nationalised. By 1979 they were all in one place, neatly organised and run overwhelmingly (and frequently poorly) from London. They were ready for the election of a new Prime Minister with big plans.

5a. Thatcher

In his conversation with Andrew Sullivan Tyler asks “why is there so much residual British hatred of Margaret Thatcher?”. Andrew Sullivan cannot answer. He simply doesn’t understand it. He notes that he is originally from South England in the episode. He sees Thatcher as an overwhelming force for good.

In Tyler’s episode with Russ Roberts, Roberts says “the last prominent politician, I think, who made the case for liberty and freedom in and of itself was Maggie Thatcher. Reagan, to some extent, also, but Maggie Thatcher did it relentlessly”.

As far as I can tell, Thatcher is mentioned in nine of Tyler’s conversations, never negatively, and mostly in very positive terms.

But Thatcher is a big part of why North England is poor today and her legacy cannot be wished away.

Those wanting a more detailed and more anti-neoliberal account of what follows can read the excellent essay on The Strange Death of Municipal England in the London Review of Books.

I am not going to criticise Thatcher’s liberalism. I wouldn't believe it and others can do that better. I was born in the mid-80’s, socialism was defeated and industry was largely gone by the time I cared. My politics aligns most closely with the Manchester Liberals. Where their political legacy most strongly lies within Britain’s modern political parties is a whole other blog post.

So my beef with Thatcher is not her liberalism. It is with precisely the opposite.

Thatcher privatised the legacy of the municipal corporations that others had already nationalised. No big change. Much more importantly, she destroyed local government so thoroughly that North England’s cites could never rebuild what they had built before.

Embraced, extended, and extinguished, the North could not argue effectively for its own interests. It was over. And while the South’s economy has grown faster than the North European average since, the North’s economy has sat stagnant for nearly four decades.

Britain has no constitution beyond “Parliament is Sovereign” and so it can have no Tenth Amendment like “the powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people”.

Without this constraint, Thatcher could destroy all government power outside of South East England. She did just that. Michael Heseltine, the Minister who made so much of the destruction happen, describes it as the greatest regret of his political career and he has spent much of his life trying, with some success, to undo the damage he executed.

The Metropolitan counties were abolished, fragmenting Northern cities into powerless chunks. Buses in those powerless chunks, one of the last remaining local services, were privatised. The Northern cities (London was treated differently for underlying reasons which should be obvious if you’ve read this far) were banned from interfering in public transport in any way. The Mechanics Institutes which the North had built largely in the face of a ban on Northern universities and which had evolved into Polytechnics and Technical Colleges were removed from local control and have since been run down to shadows of their former selves. Right-to-buy forced local governments to sell social housing, among their largest asset bases and a stable source of income, to tenants at well below market rates and give a portion of the proceeds to the central government. Powers of local governments to raise taxes were substantially removed

While Thatcher promoted the market and competition for the private sector, she created a central monopoly on the power of government. Northern cities did not privatise their remaining services because Thatcher won the argument for liberalism. Northern cities privatised their remaining services because their leaders would go to jail and Thatcher would do it for them if they refused to. The last flicker of the Northern power that the industrial revolution had created was stamped out.

"You can just do things" is an emerging meme in the pro-growth community, but since Thatcher that has been largely untrue in North England. Most of the time, someone from central government will block you, if you succeed they will try and stop you, and if you continue succeeding they will subsidise your competitors.

Britain’s equivalents of Detroit (Birmingham), Chicago (Manchester and Liverpool), and Pittsburgh (Sheffield) have not been able to bounce back from deindustrialisation in anything like the same way. They have nowhere near the same powers. Alternatives to Austin, Miami, or Phoenix similarly have no chance of emerging, lest they pose a competition to South East England. We cannot just do things.

Scotland could see what was happening. It had signed up to be part of a United Kingdom, not complete rule from London. Support for independence rose from below 15% to over 40% under Thatcher. Tony Blair’s devolution to Scotland brought that back down and freed Scotland up to outperform North England, but the return of the Conservatives to power and the huge centralisation of government within England over the last fifteen years has pushed support for Scottish independence back up to a majority view among the working age of Scotland.

7. and 8. Industrial strategy today.

For the last fifteen years, the UK government has spoken much about returning power to the North and levelling up Britain.

We should recognise the achievements. George Osborne as Chancellor and importantly as a North English MP forced through the recreation in the form of Metro Mayors of the metropolitan counties that Thatcher had destroyed. Under Theresa May the central government ban on local government regulating bus services was removed for England’s large cities. This year Greater Manchester finally took back control of every bus in the city, ensuring consistent fares, compatible tickets, and a measure of integrated transport.

But these hard-won steps forward have each time been accompanied by larger steps back.

Britain’s government and institutions have continued to move Britain’s science and innovation from the rest of the country to London, Oxford and Cambridge.

Investment in transport infrastructure remains effectively forbidden outside of central government, except in London by special dispensation, and the UK government has invested in and around London and almost nowhere else in England.

London’s eye-wateringly expensive cross-city railways — Thameslink and Crossrail — are world-leading. Meanwhile, Manchester and Birmingham remain the two largest cities in Europe without a metro system.

London is connected to Paris, Brussels, and Amsterdam by high speed rail to the beautifully restored St. Pancras station. From that station the domestic trains to small towns in the South East are long, modern, reliable, high speed and electric. At the same time the domestic trains to North England from that station — a station built with Northern money to serve Northern destinations — are pushed aside to make way for more important destinations to the South, are short, delayed, and emit diesel fumes that stain the ceiling of the Northern corner of the station. The Northern city of Sheffield which they run to is the largest city in Europe (except Albania) without a single electric train service. And its connection to Manchester, the North’s now-undisputed hub city, is unique among such a large pair of cities in the developed world in being a single lane in each direction.

HS2, the enormously expensive new railway that the North supported largely because it would smuggle Northern investment into a single project containing London and which which was thus likely to be funded by the UK government has had all of its Northern sections cancelled despite them offering the best return on investment. It will terminate shortly after leaving South England.

Leeds remains the largest city in Europe and North America with no mass transit system at all. The UK government recently blocked an expansion of its airport in part to keep the carbon budget available for airport expansion in London and a mistake of law by the UK government saw nearly half of the homes it planned to build this decade blocked.

While the UK government talked about getting power and government out of London, even establishing outposts of central power in towns like Darlington — deliberately chosen because its small size and position between great cities means it could not contribute to the creation of an agglomeration that might challenge London’s monopoly on power — it centralised its civil service overall and moved a further million government employees from local government to central government control.

The return to the historical hierarchy of Britons that Thatcher accelerated now seems at times irreversible. People who live and work in South England simply count more to Britain’s national institutions than people who live and work in North England.

A new generation of British national policy thinkers, policy advisors, politicians, and custodians of Britain’s national institutions now live almost none of their lives outside of South East England. They rarely have a memory of, or interest in, an England that is not ruled overwhelmingly from the centre. They are more likely to hire Americans, exhilarated by the potential to wield and influence the centralised power that is prohibited to them at home by their constitution, than let someone who lives and works in North England take a position of power without moving to London or spending much of their time there.

While arguing for growth today, a new generation of pro-growth voices in British policy repeat the mistake that Thatcher cemented in British political economy of thinking that a well-managed central monopoly on power is better than a competitive dispersal of power.

They celebrate new scientific institutions in London such as ARIA that repeat, against strong evidence that it will not deliver greater returns in doing so, the centralisation in the South East of England of our national research capacity.

They celebrate British political thinkers like Dominic Cummings whose consistent political legacy is the centralisation of ever more power in Whitehall and Westminster and the belief that this time, if we just hire the smartest people and get them all the data they need and apply AI to government we can get central planning to work.

They also celebrate the creation of new organisations, when they like them, such as The Open Data Institute, Nesta, GDS, the Ada Lovelace Institute, Tech City, the AI Safety Institute, and many more that employ large numbers of well-paid people in the capital and that at best prefer to spend money locally and represent local interests as national objectives and at worst actively oppose and shut down success elsewhere in the country.

They rarely notice that The British Library, a hub for so much growth in North London, continues to fail to progress its now decades-long stated ambition of opening an outpost in North England.

They promote the forced expansion by central government of the small city of Cambridge and London’s main airport at Heathrow while not considering that the same powers that will force this growth also enable, and have been proven to enable, the UK government to block the expansion of airports in the North and the growth of Northern cities.

This all happens largely without malice. It is the result of England having forgotten, and — embarrassed by the comparative success of Ireland and Scotland having rejected this centralisation — not taking the opportunity to remind themselves of the power of competition and markets in government.

South England’s pro-growth policy thinkers seem well-informed on the perils of monopoly power and the tempting but wrong arguments for the efficiencies of central planning in the private sector, but ambivalent to those same arguments applied to government.

9. Sanity checking, AI, and a problem that cannot be ignored.

At this point, especially if you are not from Britain and Ireland, I would be surprised if you did not think I was at least slightly mad. I sometimes wonder that myself, to the extent that I try and test my sanity. I speak to a lot of people who tell me I’m not mad, but maybe there’s something in Northern water that’s affecting us all.

I am fortunate as an early builder of, and Head of Data at, one of the UK’s few new Northern institutions that the South has been unable to close down (though they did make us change our name, and we can’t strictly call ourself an institute as that word requires permission from the South to use).

So when the interesting new London-based think tank UK Day One published the results of a survey of pro-growth economists who I suspect to be overwhelmingly South English and suggested that these results showed a national opinion, I was able to quickly organise a survey of North English economists to show how differently we see the path to growth. I convinced myself I wasn’t mad.

I am also fortunate to be a founder and the CTO of one of the UK’s fastest-growing AI startups.

So I can run extremely powerful AI models locally and thus ensure they cannot simply agree with my known opinions (which they are otherwise known to do). I can check that my reading of UK policies, strategies, and laws that I think obviously preference South England also read that way to a relatively impartial machine.

Recently I asked DeepSeek to tell me if the UK’s new AI Opportunities Action Plan favoured South England or North England. It was able to confirm my suspicions that the concrete action of establishing the UK’s first AI Growth Zone in Oxfordshire (the South) trumped the promise of such growth zones benefitting post-industrial towns (the North) and coastal Scotland.

So I don’t think I’m completely mad and nor do I think that my rantings in this blog post are completely futile.

Where the UK government has funded growth in North England in a way that should work, it has worked in about the measure their funding and freedoms would allow. It is a low bar, but Manchester’s economy has nearly kept up with East German cities while the rest of North England falls behind. We see from that city that strong local leadership can convince the British state to treat the North less badly and that given even slightly less bad government from the centre, the North can do well.

I also know that the North cannot be ignored. The British state cannot afford the large and increasing fiscal transfers needed to maintain national public services in a North whose economy is so weak.

There are simple and proven actions that would change the trajectory of Northern growth and boost British prosperity. I wrote them down at the top of this piece.

I have hope that the British government and our national institutions in the South East of England will do the right thing once they can no longer afford not to. I will continue contributing to a model of partial success that they can build on when they are ready.