Britain’s Political Economy is Changing. Labour needs to become relevant.

A couple of weeks ago I wrote how globalisation itself was fraying, driven partially by the rising political anger of its losers. The people who live under the “elephant trunk”.

It’s been clear for a while that the tensions between globalisations winners and losers in the UK — tensions papered over for a couple do decades by easy credit — are rising. After Thursday’s vote, those tensions can’t be ignored.

Yesterday I set out a scenario for how the next few months might play out.

The exact specifics here could well be wrong. But it is now clear as day that Labour has a UKIP problem.

That is itself driven by the rise of “open vs closed economy” as a major political split.

Bloomberg’s very smart Rob Hutton summed in up in 8 tweets.

I worry this is right. That British politics is splitting into open vs closed — the 48 vs the 52.

It could end up looking at bit like Polish politics a centre right, pro openness party facing a further right, nativist closed party.

I think that future of politics looks grim. Labour irrelevant.

But then there’s Rob’s last tweet.

This is what I was getting at, in my post two weeks ago:

the world needs to relearn an old lesson: if you want global capitalism to succeed then it needs to come with a big dose of social democracy.

Or in these tweets:

If open vs closed is a new important cleavage in British politics — then the correct response isn’t to pick a side, it’s to forge a coalition of globalisation’s winners and its losers based on economic openness and redistribution.

Labour has to make itself relevant to post referendum politics. It should be setting out on a different path — one that recognises the virtues of economic openness whilst promising to share the benefits far more widely.

I’m afraid this path seems very unlikely with the current leadership.