Rafe Fletcher is the founder of CWG.
Dario Amodei kickstarted the recent peak in AI hype with a 20,000-word essay on the technology’s imminent dangers.
Released just as his company Anthropic (which counts Rishi Sunak amongst its advisers) embarked on a new US$30 billion funding round, cynics may infer ulterior motives in Amodei’s elucidation of AI’s awesome powers. Nevertheless, its renewed prominence leaves governments responding to an age-old question: how to harness technological revolutions while limiting societal disruption?
The subject was top of the agenda in Singapore as Prime Minister Lawrence Wong presented the country’s budget last Thursday. New policies include generous tax deductions for businesses’ AI expenditures and free access to premium AI tools for Singaporeans who take up certain AI training courses. “AI is a powerful tool”, said Wong, but “it must serve our national interests and our people.”
In Singapore, capitalism and its innovations have always been a means, not an end. Something that was sometimes misunderstood by British Brexiteers imagining Singapore-on-Thames as bastion of laissez-faire economics. The better analogy is Vote Leave’s own Take Back Control when it comes to market forces. Use them but steer them.
The problem is that Britain lacks this same autonomy. The Conservatives share the blame for that. Tension between its strands of economic liberalism and paternalism manifest in strategic incoherence. That split was always present but more easily reconciled when Britain was a leading power. Perhaps the closest historical parallel to AI disruption, the Industrial Revolution, illustrates this.
Karl Polanyi’s 1944 book The Great Transformation is an account of Britain’s pioneering capitalism in the 19th Century. Polanyi was a Hungarian Jew who first fled from Budapest in 1919, then Vienna in 1933, following the respective ascension of fascist regimes. He argues free markets underpinned this terror, a result of trying to square the subsequent disorder. Polanyi’s own moderate socialism looks a tad naïve given the authoritarianism he witnessed first-hand. Particularly his belief that we can trust an interventionist government if it is “true to its task of creating more abundant freedom for all.”
But an errant prognosis does not diminish what Polanyi gets right. Chiefly that the market forces guiding the Industrial Revolution and Britain’s economic supremacy were not entirely organic. Britain’s rise rested not only on technology but government decisions about trade, finance and property. Empire and global reserve currency status meant Britain naturally absorbed the advantages of a new free-market structure.
Domestic politics then debated the balance between accelerationism and gradualism. Polanyi’s own belief that the “rate of change is no less important than direction itself” was articulated by 19th Century Conservatives. Figures like Richard Oastler jostled with Whig Prime Minister Early Grey over the 1834 Poor Law, which denied the rights of the poor to subsistence. The former believed unemployment was a manifestation of the social dislocation wrought by sudden change. The latter that it was simply an unwillingness to work for the wages available in the labour market.
The same Whig-Conservative divide shows up in earlier views of Napoleon Bonaparte. Whigs like Charles James Fox were sympathetic to the Corsican General. Firstly, because his European reforms offered trading benefits, with newly liberalised and legalised economies. Secondly, because they resented the costs of fighting such a drawn-out war. It was the Conservatives, under Pitt the Younger, who were far more obstinate in enduring heavy taxation and economic blockades to keep fighting. Trade and sovereignty pulled in different directions, but Britain was strong enough to manage the tension.
Disparity was manageable because Britain held such sway over market mechanisms. It could repeal the mercantilist Navigation Acts in 1849, giving up privileged shipping rights because naval supremacy allowed it to row back if necessary. Paternalistic public health reforms and workplace safety legislation were possible because Britain had the fiscal means to do so. Its economic pre-eminence entitled it to indulge both factions.
Today’s Conservative Party is an amalgamation of these differing proclivities. The Whigs, and its subsequent Liberal iteration, were subsumed into this new broad church in 1912. We recognise these different strands in the form of Disraeli’s one-nation conservatism and Gladstone’s classical liberalism. But as Britain’s influence has diminished, so these result in contradictions. It does not have the economic might to sustain both visions. It has to offer a transparent choice – going for growth or a more paternalistic state-directed gradualism.
The lesson from Singapore is that it is too late to have both. Its autonomy to handle AI comes from years of consistent government and strategic planning. It has built huge domestic savings, enshrined balanced budgets in law and maintained a strong industrial base (manufacturing still represents 25 percent of GDP). Britain has none of these things.
But it has many other advantages. It is a talent hub. Americans rave about the opportunity to hire top-tier talent at a third of the price. And (for now) it is free of the EU regulation that threatens to stifle AI development. What it lacks in infrastructure it can incentivise the Anthropics of this world to build through de-regulation and tax incentives if accompanied by liberal energy and planning reform.
Offering such perks would require a drastic overhaul of the state. And proponents may be buoyed by recent evidence that the British public is feeling a little less statist. Recent research reported an all-time high of Brits saying tax and spending should be reduced. But it still pales in comparison to the number calling for more or the same.
The alternative is to be upfront about trade-offs. Britain is unlikely to be a leader in any AI revolution. But it will do its best to manage it. It will protect jobs, regulate where necessary and guard social cohesion. It’s a perfectly reasonable Oastlerian conservative position when delivered with clarity. And perhaps, if Amodei’s claims prove overblown, it will look prescient.
The Conservatives need to define what they stand for as they go up against Reform as the party of the right. They can be guardians of paternalism or engineers of growth. But it is dishonest to pretend both are possible. Unlike the Industrial Revolution, Britain does not have the luxury of leading this one. Control only comes from informed choice.
And the Conservatives must decide what tradition they stand for.