When I went to Manchester last year, there was one place I particularly wanted to visit: the Free Trade Hall. The building was constructed in the middle of the 19th century to commemorate the repeal of the Corn Laws. Manchester was then the heart of manufacturing, the Industrial Revolution and, most importantly, the struggle against protectionism. It was also the centre of a rivalry that shaped modern English politics: ‘the rivalry between land and industry, protection and free trade, aristocracy and middle-class identity, the territorial constitution and the ‘commercial principle’, national greatness or cosmopolitan utopianism’. From this conflict emerged the Manchester School. If the proponents of the Manchester School were alive today, they would have every right to sue Andy Burnham for his use of the word ‘Manchesterism’.
Burnham appears to be launching a bid to become the next Prime Minister, helped by a recent MP resignation and backing from Wes Streeting. Burnham seems to have learned one lesson from Keir Starmer: you cannot lead without a plan. Unfortunately, that is the only lesson he appears to have learned. A plan must also pass the smell test.
Burnham’s plan is ‘Manchesterism’: a form of business-friendly socialism. The main evidence offered for its success is Manchester itself, where new towers are rapidly changing the city’s skyline. But even if the Manchester model were applied nationally, the results would likely be disastrous. Manchester City Council’s debt rose by £289 million last year, and the council is now among the most indebted in the country, with liabilities of roughly £1.6 billion.
This points to the first problem with Manchesterism: you cannot simply ignore borrowing costs, or claim, as Burnham has, that governments should not be ‘in hock to the bond markets’. The bond market matters particularly in Britain. As the Financial Times has calculated, if Britain enjoyed France’s borrowing costs, taxpayers would save around £20bn annually. Yet Burnham’s camp indulges in the fantasy that there is ‘good debt’ and ‘bad debt’, and that if governments borrow for infrastructure, markets will automatically reward them with confidence and low interest rates.
That is a myth. When markets see a government already facing borrowing costs far higher than many of its G7 competitors, yet still eager to borrow more, they draw a simple conclusion: the government is not serious about managing its finances.
Here we arrive at the second problem with Manchesterism: it has no meaningful desire to restrain welfare spending. Burnham has described competition between hospitals and care providers as ‘an alien ideology’, and both his record in Gordon Brown’s government and his tenure in Manchester suggest little appetite for reducing the welfare bill. Markets understand that without spending restraint, governments eventually run out of ways to pay their future obligations and they price that risk accordingly through higher bond yields. So how would Burnham fund a rapidly growing welfare state alongside rising debt-interest payments? That brings us to the third flaw in Manchesterism.
In a 2025 Sky News interview, Burnham argued that ‘we’ve overtaxed people’s work and we’ve undertaxed people’s assets and wealth, and that balance should be put more right’. He has signalled openness to wealth taxes. In this sense, Polanski’s economic policy is logically more consistent than Manchesterism. Polanski wants wealth taxes, higher welfare spending and more borrowing, but at least he does not believe these policies will magically produce growth; he even sees degrowth as desirable. Burnham, by contrast, is trapped in a series of contradictions. He wants faster growth, yet also more welfare spending on people outside the workforce. He wants to cut waiting lists, but opposes any significant reform to what he calls the National Care Service.
Manchesterism is a third way leading nowhere. You cannot be both socialist and business friendly. You cannot issue ever more debt while simultaneously reassuring the markets. Manchesterism does not know what it wants to be: it seeks the advantages of two incompatible systems, but fails the test of reality. This is precisely the problem Ludwig von Mises identified in ‘Planned Chaos’: ‘The issue is always the same: the government or the market. There is no third solution.’ Burnham’s economic programme would be a planned chaos.
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