Our Post-Industrial Future: How Britain Made Half Its People Obsolete #256

Age of Anti-empires edition

Adrian Monck

May 29, 2025

Grüezi!

How Britain perfected human obsolescence as economic policy – from Liverpool’s docks to national strategy
Why Europe is courting Beijing whilst Washington wages tech cold war – the diplomatic dance revealed
Russia’s shadow war on European infrastructure: 34 attacks last year, but officials won’t name the enemy

1 The Realm of Obsolescence

“You think your country needs you, but you know it never will.”

Martin Parr’s obsolete camera chronicles an island’s obsolescence

“Two nations; between whom there is no intercourse and no sympathy…” — Benjamin Disraeli, 1845

Liverpool lost 40% of Atlantic trade but gained 4 million tourists – post-industrial instagram posts
London’s GDP per head hits 170% of UK average whilst North East languishes at 74% — policy ratchets widen the divide systematically
77% of new R&D jobs landed in just three southern regions — managed decline masquerades as entrepreneurial renewal

Britain has hardened into what Benjamin Disraeli once called “two nations” – but his Victorian divide between rich and poor has evolved into something less onerous but more insidious.

The conversion of empire into asset, and grievance into entertainment, has created an economic order where one half trades futures on the world economy while the other subsists on heritage warehouses and Deliveroo shifts.

It is a Realm of Obsolescence optimised to manage decline through marginalising its own population while protecting the privileges of its custodians.

The Wolf Warning

This week Martin Wolf delivered a brutal assessment: Britain is “an economy whose trade performance is dire, above all in goods.” UK goods exports sit 20% below 2019 levels.

In a serious political culture, such warnings would trigger emergency action. In the Realm of Obsolescence, they feed the content rage mill – more material for sovereignty theatre while the factory lights go dark.

The numbers sketch Disraeli’s prophecy fulfilled with brutal precision. In 2023, London generated £69,077 of GDP per head while the North East managed £28,583 – a 2.4-to-1 gulf.

Weekly wages echo it: £853 in the capital versus £661 up north. Manufacturing has withered to 9.2% of output as services swelled to 81.2%. What growth remains is intangible and southern.

Liverpool: The Obsolescence Blueprint

Liverpool – tragically in headlines this week – perfected the model that now defines Britain. At its 19th-century peak, 40% of world trade flowed through its docks.

When empire dissolved, the workforce became superfluous. Dock labour collapsed from 10,500 in 1971 to 2,000 by 1983. Three brutal years saw 384 factory closures and 25,000 jobs vanish. Phoney Beatlemania bit the dust.

The remedy, devised under Thatcher and refined since: abandon the inhabitants, turn the ruins into scenery.

Today the Albert Dock welcomes six million tourists annually but scarcely a dozen cargo ships. Historian Sam Wetherell calls Liverpool’s trajectory “a prophecy” for Britain.

Waxworks replaced wages; casino chips replaced capital goods.

Managed Decline as National Strategy

What began on Merseyside has metastasised into the governing logic of Britain’s Two Nations. Some 9.4 million working-age adults – 21.4% – are economically inactive. Another 6.3 million draw out-of-work benefits. A record 2.8 million are long-term sick, and 569,000 young people sit NEET.

The Realm of Obsolescence isn’t merely short of factories; it’s systematically learned to sideline labour over decades.

Policy ratchets widen Disraeli’s divide. R&D tax credits funnel 60% of benefits to the London-Oxford-Cambridge triangle. Investment zones overlay existing growth hubs, bypassing the cold spots they advertised to revive. Green belt restrictions inflate southern property values, handing landlords the unearned dividend of constraint.

The Spectacle Economy

Brexit was obsolescence management’s alchemical peak – it was the firework display that kept eyes skyward while the factory lights went dark.

Every factual setback becomes fresh cue for cultural pageant, ensuring Wolf’s warnings about Britain’s “dire” trade performance remain offstage entertainment rather than policy emergency.

Beyond Two Nations

Other economies prove alternatives exist. Denmark couples bigger manufacturing share than Britain with record R&D intensity. Sheffield’s advanced materials hub defies the national script, but succeeds despite, not because of, Westminster’s lead.

The choice? Britain can perfect its Two Nations model – half souvenir shop, half ticket office – or rebalance toward regions, skills and tangible production. Wolf’s diagnosis demands the latter. The question is whether Disraeli’s Victorian warning has become Britain’s post-imperial epitaph.

2 Apple’s China Gamble

Profits, Politics and the Perils of Dependence

A $275 bn pact bought a decade of cheap iPhones – while handcuffing Cupertino’s profit engine to Guangdong’s factory floor.
Now Washington’s tech cold-war recasts that bargain as dependency risk, from rare-earth wafers to App Store gatekeeping.
Apple’s counter-move: keep the silicon brains at home, scatter assembly across India, Vietnam and Mexico – and sprint up the value stack faster than Beijing can follow.

Patrick McGee wants us to believe that Apple performed an “accidental act of nation-building” in China. His new book piles up the evidence: a $275 billion pledge to Beijing, vast training schemes for Chinese engineers, an iPhone pipeline in which four-fifths of units still leave Chinese factories.

Western reviews are gleefully condemnatory – “Faustian”, “complicit”, “in thrall to an authoritarian state”.

Yet the prosecution rests on an incomplete brief. A glance back at the last great “foreign-factory panic” shows why.

Witness omissions

Apple’s China adventure did not unfold in a vacuum. Wall Street cheered every percentage-point margin the company eked out by arbitraging Chinese scale. American consumers pocketed a decade of falling handset prices. Washington treated the resulting deflation as a free gift that kept inflation tame. To cast Apple as lone villain is scapegoating.

The 1980s provide a cautionary comparison. In The Reckoning (1986) David Halberstam blasted Ford for ceding the future of the car to Nissan through managerial complacency and quarterly myopia.

Clyde Prestowitz’s Trading Places (1988) accused Motorola and the Big Three of “surrendering the industrial high ground” to Japan for short-term gain. Then, too, critics isolated a handful of corporate culprits while glossing over the millions of Americans who loved cheap Toyotas and Walkmans and the politicians who banked the disinflation.

America loves vilifying corporations for behaving like – well – corporations.

Survivor bias in the dock

McGee’s stage contains exactly one American hardware maker. But the class of 1992 – Compaq, Gateway, Dell, Motorola – pursued the same Shenzhen miracle. Most failed to jump from box-shifting to high-margin intangibles and either vanished or became low-value assemblers.

Apple looks omnipotent chiefly because the rest of the cohort lies in the corporate boneyard. Halberstam’s indictment of Ford had the same blind spot: it followed the company that survived long enough to be beaten up on.

Rivalry, not regime type

The book treats China’s political system as the decisive danger. In truth, what rattles Washington in 2025 is less Xi Jinping’s censorship than China’s arrival as a genuine technological peer – from batteries to AI inference chips.

Were China a Nordic democracy with identical industrial clout, the strategic angst would be almost as sharp. Japan was a treaty ally, yet Prestowitz still warned of surrender. Dependency on a rival is the rub; regime optics merely colour the risk.

What the indictment skips

Apple poured capital and process know-how into Guangdong; China supplied speed, scale and an eager workforce. By 2010 the iPhone was the world’s most profitable gadget and Chinese export zones were buzzing. Everybody – Cupertino’s investors, America’s shoppers, Beijing’s planners – banked the gains.

Over the past decade Apple has shifted its biggest cheques away from factory floors and into things that travel badly: home-grown A- and M-series chips, the Swift programming language, services such as the App Store and the on-device AI now baked into every new gadget.

Final assembly, by contrast, is being sprinkled across India, Vietnam and Mexico, while Apple has nudged TSMC to build a leading-edge fab in Arizona. The motive is not flag-waving but option-value: keep the high-margin brainwork close, and let screwdriver work roam to whichever jurisdiction offers the best mix of cost and political safety.

That echoes the earlier American pivot. In the 1980s Japanese firms owned precision manufacturing; Silicon Valley, unable to win on yield, sprinted two rungs up the ladder to software and processor architecture, subcontracting the rest.

As Carl Benedikt Frey notes, openness, not tariffs, regained America’s lead. McGee scarcely mentions the precedent, yet it is the only proven cure for supply-chain entanglement: innovate faster than the follower can copy.

What a fair verdict would say

Systemic complicity. America benefited from Apple’s China play because it blunted inflation and fattened pension funds. If the bargain was reckless, the gains were universally shared.
Adaptive escape. Apple is already climbing out the other side, ploughing cash into intangibles and sprinkling assembly across jurisdictions. That is the textbook response to a peer competitor – and a blueprint for others.
Rivalry over regime type. The headache is industrial dependence on an equal, not moral contamination. Diversify chokepoints such as lithography and critical minerals, and keep domestic competition fierce enough for new champions to out-invent the last.

The punch-line is less satisfying than McGee’s thunder. The West cannot wash its hands by condemning one firm, any more than Halberstam’s readers could blame Ford alone for Detroit’s failings. Globalisation was a collective calculation: profitable for years, awkward now, and not easily reversed.

The smartest response is what Apple is improvising – spread the factory footprint, double-down on the layers of the stack that travel poorly and keep tariff walls low enough to force perpetual reinvention.

Apple’s original sin, then, was shared; its sentence is already half-served, and its parole strategy – much like Silicon Valley’s 40 years ago – is to outrun, not out-wall, its rivals. A slimmer, sharper book would have told that tale – and left readers wiser than any broadside can.

3 “Bought In China 2030”

Half a Billion Reasons for Optimism

China will field 500 million middle-class consumers by 2030 – more than the entire US population
Consumer spending grew 9% annually for two pre-Covid decades despite doom narratives
Modest improvements create enormous effects—half a billion consumers don't need revolution, just evolution

There’s a curious paradox at the heart of the China consumption debate.

Economists have spent over a decade warning that Beijing’s investment-led growth model has reached its limits, few seem willing to entertain the possibility that Chinese consumers might actually deliver the rebalancing everyone claims to want.

Consider the numbers: China already boasts the world’s second-largest consumer market, with household spending growing at 9 per cent annually in real terms over the two decades before Covid hit.

Chinese consumers account for the largest share of global demand in everything from luxury goods to movie tickets, but the prevailing wisdom? Meaningful consumption growth is beyond Beijing’s reach.

The scepticism isn’t entirely misplaced. Consumer spending represents just 40 per cent of China’s economy, well below the global average of 60 per cent.

The country’s zero-Covid approach and property crash have left households scarred, confidence languishes below pre-2020 levels and precautionary savings are up. These are real constraints.

Against the Downbeat Drumbeat

The downbeat narrative rather misses how substantial China’s consumer base already is. We’re not talking about building consumption from scratch.

By 2030, China will have over half a billion middle- and upper-class consumers—more than the entire US population.

Even modest improvements in spending propensities would produce enormous aggregate effects.

The structural factors working in favour of consumption are more compelling than most analysts acknowledge.

Take demographics: as China ages, the ratio of savers to consumers will naturally decline. This isn’t a policy choice – it’s arithmetic.

East Asian economies typically see savings rates peak when their working-age populations top out. China’s rather more dramatic demographic transition could produce a faster drop in savings than neighbouring countries experienced.

City Slickers

Urbanisation is another lever. Two-thirds of Chinese live in cities, compared with over 80 per cent in OECD nations. Research suggests migrants see their consumption rise by 30 per cent when moving to urban areas, with an additional 30 per cent boost when fully integrated.

Reforming the hukou registration system, which currently limits rural migrants’ access to urban services, could unlock significant spending power.

The geopolitical dimension adds urgency to domestic rebalancing. Trump’s tariff agenda isn’t disappearing, and trade tensions with Europe and Australia aren’t easing. Export-led growth faces increasingly constrained markets.

Beijing may well find that playing nicely on trade whilst Washington maintains its hardball approach offers diplomatic dividends. But it also makes nurturing domestic demand essential, not optional.

Dual Circulation Problems

What’s intriguing is the political momentum behind consumption-led growth. Xi Jinping’s “dual circulation” strategy calls for strengthening domestic demand. “Common prosperity” – reducing inequality – dovetails with boosting household incomes. These aren’t abstract policy goals; they’re central to Xi’s political project.

The policy toolkit exists. China could transfer income from local governments to households, particularly poorer ones. It could strengthen social safety nets, reducing the need for savings.

Financial liberalisation could channel the country’s enormous savings more efficiently toward consumption. Even modest welfare reforms would have outsized effects given the scale of China’s consumer base.

Beijing enforced the one-child policy, opened the economy in the 1980s, and built the world’s largest high-speed rail network. When priorities and political will align, it can deliver.

The question isn’t whether Chinese consumers have the power to drive growth –it’s whether the trade-offs required to unleash that power are politically acceptable.

That means tolerating slower investment growth, reduced export competitiveness, and resistance from vested interests that have prospered under the current model.

External pressures and internal demographics are making those trade-offs increasingly inevitable. China’s export markets are shrinking whilst its population is ageing. The status quo isn’t sustainable.

One Solution, Evolution

Perhaps most importantly, China doesn’t require a consumption revolution—just evolution. The consumer culture already exists. The middle class is expanding rapidly.

The infrastructure for domestic commerce is world-class. What’s needed isn’t transformation from scratch, but rather allowing existing consumer power to claim a larger share of the economy.

Gradual reforms are already underway in pensions, benefits, and urban registration systems. These may seem modest, but modest changes applied to half a billion middle-class consumers produce rather dramatic aggregate effects.

The consumption rebalancing might not happen as quickly or smoothly as optimists hope. But dismissing it entirely seems to misunderstand both the scale of opportunity and the mounting pressures for change.

China’s consumers have struggled in recent years, but enormous spending power remains locked away. And Beijing holds both the key and – now – compelling reasons to use it.

4 The Lukewarm Embrace

Europe sidles toward China as America turns away

When Ursula von der Leyen and António Costa board the Airbus for Beijing in July, protocol will be flying in the opposite direction. It’s China’s turn to come to Brussels for the biennial EU-China summit. Xi Jinping prefers home advantage.

Europeans, chastened by the return of Donald Trump to the White House and jittery about a grinding war on their eastern flank, will oblige. In the hierarchy of diplomatic indignities this is minor. In the shifting geometry of global power it speaks volumes.

War, wedge and weariness

Russia’s invasion of Ukraine cratered EU-China relations. Beijing’s refusal to condemn the aggression – and its habit of parroting the Kremlin’s euphemisms – turned frosty ties positively glacial. Three years on, Ukrainians and their supporters are exhausted.

With Washington sounding similar to Beijing and hinting that military aid may dry up, talk of a cease-fire no longer sounds treasonous in Paris or Berlin.

Officials who once scolded China for “playing Russia’s accomplice” now wonder whether coaxing Beijing into a face-saving diplomatic role is the least-worst route to peace. Europe has discovered that moral certainty is easier and cheaper to deliver than victory.

If China can be prodded to lean on Moscow, that will serve. Hence the procession of European dignitaries to Beijing: Kaja Kallas, the EU’s isolated foreign-policy chief, turns up in early July; environmental and economic envoys follow behind.

Trade, tariffs and other thorns

Ukraine is hardly the only irritant. Europe accuses China of subsidising everything from solar panels to electric cars at prices its firms cannot match.

Brussels has introduced screening rules and an anti-dumping probe into battery-powered cars; draft tariffs of 45% are in the drawer. Beijing has retaliated in miniature, a few EU wine bottles here, a probe on cognac there.

Both sides know a full trade war would be ruinous. America’s steep tariffs on Chinese goods have made Europe a logical replacement market; economists reckon a third of Chinese exports once bound for the US will try their luck in the EU. That flood could submerge European manufacturers, yet it would also keep consumers afloat with lower prices.

Beijing’s latest olive branch – a decision to lift sanctions on several MEPs imposed during the Xinjiang row – was small but telling. Chinese officials add that they are willing to buy from Airbus and drugs companies if Brussels holds back.

What Europeans really think

Elite intrigue is one thing, public attitudes another. 4 per cent of EU respondents call China an “ally” but 39 per cent say it’s a “necessary partner”. 37 per cent label it a “rival” or “adversary”. In other words, a narrow majority still puts China on the positive side of the alliance ledger.

There are familiar regional rifts: southerners who want Chinese investment are warmer than northerners who fret about dependency. Still, the data suggest Europe’s hawks have not won the argument at home. For policymakers, that offers political cover to keep talking – even bargaining – so long as national interests are protected.

Autonomy, with safety rails

Nervous Atlanticists fret that Europe is wandering into Beijing’s web just as Washington wages a technological cold war. Reality is subtler. “Decoupling” is passé in Brussels; “de-risking” is the slogan.

The EU is busy building safety rails – stockpiling critical minerals, screening Chinese investment in sensitive ports and nudging supply chains toward Vietnam or Mexico. It will not cut the commercial cord.

Even in Warsaw the penny has dropped: America’s security umbrella is flapping in the MAGA wind, and a continent that accounts for barely 2 per cent of world chip capacity cannot afford to treat China as a pariah.

Hence the new mantra: engage where possible, push back where necessary. Brussels will keep blacklisting firms that feed Russia’s war machine and slap duties on dumped goods.

But it will also press ahead with climate co-operation, green-tech standards and, yes, a resuscitated investment pact.

In a multipolar world Europe intends to paddle its own canoe – accepting help from whoever offers an oar, while keeping a wary eye on the current.

Beijing’s calculations

Why does China bother?

It needs cash buyers for surplus stuff as American markets narrow.
Smooth ties with the EU blunt Washington’s “West vs. China” narrative.
European tech – especially in aerospace and machinery – remains coveted.

Still, China’s leverage is limited. President Xi would rather not see EU protectionism ossify into a tariff wall, but he is unwilling to abandon Russia or dismantle the subsidy machine that sustains Chinese factories.

Thus the dance: modest concessions from Beijing, guarded nods from Brussels, no grand breakthroughs.

Talk is cheap – and useful

Even so, talking beats sulking. If July’s summit yields a modest road map – some trade rebalancing, a token Chinese Airbus order – it will count as progress.

Europe’s strategy is to keep channels open long enough for circumstances to improve: a steadier global economy, perhaps, or a post-Putin Russia ready to bargain.

President Trump may discover that bullying Europeans on tariffs or defence spending risks driving them further into China’s embrace. Some in Brussels would not object if he did.

For all the talk of an age of blocs, Europe is not a brick to be mortared into someone else’s wall. Courting Beijing while hedging against it is not duplicity; it is diplomacy.

Europe moves like a heavyweight, punches like a featherweight.

The question is whether Brussels, famous for chronic indecision, can sustain the balancing act. If it can, the summer summit may be remembered as the moment the continent stopped being the object of great-power rivalry and started playing the game on its own terms.

5 Ukraine’s Range Anxiety Lifts

Gloves are off but is there anything left to punch with?

German Chancellor Friedrich Merz’s announcement that Ukraine’s allies have lifted range restrictions on their weapons made headlines, but what does it mean?

Ukraine can now strike deep into Russian territory with Western-supplied missiles. But with what exactly?

Are we witnessing strategic revolution or carefully managed rhetorical sleight of hand designed to influence negotiations rather than battlefield outcomes?

The Arsenal Reality Check

Ukraine received fewer than 50 long-range ATACMS missiles from America, and they were probably exhausted months ago.

Britain has provided around 100-200 Storm Shadow missiles since 2023, with France sending smaller quantities of its SCALP-EG version. Italy may have provided additional units, though this remains unconfirmed.

So we’re discussing the lifting of restrictions on weapons Ukraine possesses by the dozen, not by the hundreds.

An ATACMS costs over $1 million. Storm Shadows cost double. Can several dozen precision strikes alter strategic dynamics against a military operating across thousands of kilometres of territory?

Two years of conflict has provided ample time for logistics adaptation. Russia has moved most military aircraft to airfields about 300km from Ukrainian-controlled territory.

Critical infrastructure has migrated beyond likely strike ranges. Command functions are spread across multiple locations.

The German Question

Germany’s Taurus missiles, with their 500km range and bunker-busting capabilities, could reach strategic targets like the Kerch Bridge.

Germany has 600 of them, and could probably spare 100 without compromising its own defence capabilities, potentially increasing Ukraine’s cruise missile inventory by a third.

But Russia’s most important targets – ammunition factories, logistics hubs, command centres – often lie beyond the range of Ukraine’s limited arsenal.

Political and practical realities intrude. The German public remains sceptical and European coordination could delay deliveries until summer.

What Actually Changed

Allied consensus on targeting rules represents important political unity. But battlefield transformation requires sustained weapons supply at scales that current Western production cannot support.

The moment everyone finally said yes to Ukrainian targeting freedom may prove less transformative than the moment Western defence production finally scales to support that freedom sustainably.

The arithmetic matters more than the rhetoric.

6 Europe’s Shadow War

Why Officials Won’t Name Russia’s Sabotage Campaign

Russian operations against European infrastructure nearly tripled in a single year – from 12 documented incidents in 2023 to 34 last year.
European authorities persist in treating systematic state-sponsored sabotage as isolated criminal acts.
This disconnect isn’t bureaucratic confusion. It’s strategic choice – and it may be the wrong one.

The Escalation Pattern

The progression follows classic hybrid warfare doctrine, executed with remarkable precision.

Phase one targeted Ukraine’s supply chain directly: assassination plots against German defence executives, factory fires at missile manufacturers, systematic disruption of weapons production. The logic was simple: sever the weapons supply, weaken Ukrainian resistance.

Phase two expanded to civilian infrastructure. Coordinated sabotage of French railways during the Olympics opening ceremony – officially attributed to domestic far-left groups, though the technical sophistication suggests broader capabilities.

DHL packages rigged with incendiary devices designed to ignite on transatlantic flights – what German intelligence called “sheer luck” that they activated on the ground rather than in the air. Finnish water facilities subjected to systematic reconnaissance – equipment examined, nothing stolen.

Phase three direct political targeting. Three Ukrainian nationals attacked property linked to Keir Starmer over four days in May. This wasn’t harassment. It was a demonstration: we can reach your leaders in their homes.

The pattern:

Russia denies
Europe doesn’t definitively accuse
Ambiguity serves everyone’s immediate interests whilst obscuring the larger campaign.

This is calculated escalation designed to test European resolve whilst remaining below Article 5 thresholds.

The Attribution Paradox

European responses reveal a striking contradiction. Intelligence services speak with increasing urgency about Russian hybrid threats whilst treating specific incidents as criminal coincidences.

Germany’s intelligence chief describes hybrid measures at “unseen” peacetime levels. Britain’s MI6 warns of “staggeringly reckless” campaigns. But individual prosecutions? They focus on criminal conspiracies rather than state terrorism.

The logic is clear: criminal prosecutions avoid diplomatic escalation and obligations to respond that acknowledging state warfare would demand.

The Real Stakes

Russian hybrid operations serve three strategic objectives that European responses scarcely acknowledge.

Deterrence – undermining European confidence whilst demonstrating Russian reach.
Preparation – testing capabilities and responses for potential future escalation.
Division – straining alliance unity through sustained pressure below collective defence thresholds.

The question isn’t whether Europe can defend against these attacks – it’s whether it can continue to deny the war already being waged.

7 Personal Note

ONE BIG THING

Launches this week!
Premium newsletters now average $593/year
Financial analysis subscriptions command $300-1,200 annually

7THINGS will always be free.

But geopolitical intelligence affects every market, every business decision, every policy choice.

So this week I’m launching ONE BIG THING – a weekly deep analysis on the single most important geopolitical story.

Tuesday’s inaugural edition: China’s succession crunch.

ONE BIG THING: $10/month or $100/year.

Compare: Average premium newsletter $593/year.

Early subscribers get founding member pricing. Link is in my profile!

Seven snapshots from a world where human obsolescence becomes a national strategy, consumers hold keys they won’t yet turn, and hybrid warfare hides behind criminal procedure.

The arithmetic matters more than the rhetoric – whether measuring Britain’s decline, China’s potential, or Europe’s shadow war.

More next week from the intersection of power and paradox.

Thanks for reading!

Best

Adrian