Burnham adviser Jim O'Neill: UK relies too heavily on the US

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LONDON — A senior economist advising Andy Burnham as he prepares for No. 10 Downing Street has criticized the U.K.’s longstanding reliance on the U.S.

Jim O’Neill, who served as a Conservative Treasury minister from 2015 to 2016, said Whitehall is “schooled in this view of life that whatever is going on, you always side with the U.S.”

The former chief economist at Goldman Sachs has been informally advising Burnham, who is expected to take over later this month as British prime minister, but told POLITICO he has not been offered a formal role.

O’Neill — who coined the acronym BRIC for the fast-growing economies of Brazil, Russia, India and China 25 years ago — said that after two years of dealing with an erratic Donald Trump administration the U.K. should cast its trading net more widely.

“The first 18 months of Trump mark two is finally shaking them up a bit. They’re thinking: ‘We can’t actually rely on these guys in the way that we used to.’ But they’re just assuming that this is just a bit of a temporary thing, and the U.S. will become more sensible soon, and it’ll be back to normal. It’s a bit of a wake-up call,” he said.

The ex-minister now sits as a crossbench peer in the House of Lords. He suggested Britain “should be open to increasing its trade with countries like China,” adding: “We have to be clear and consistent about the values we really hold and we need to be consistent.”

Very good antenna

O’Neill, who was speaking ahead of the launch of his new think tank the BRICS+ Thinking platform, is expected to be one of the voices shaping the quest for growth in the Burnham reboot of Labour in power, but he said he is not certain he would accept a formal role, even if he is offered one.

“Whoever first broke that story, it’s just a load of rubbish,” he said of reports he was being tapped up for a Downing Street job . “I’m not sure if I would accept something. It depends. I have a lot to give up.”

O’Neill is optimistic Burnham can defy critics who have complained that his political and economic philosophy “Manchesterism” is ill-defined.

“I think the first couple of weeks of Andy will be very exciting,” O’Neill said. “Let’s see. As I often say to his gang, once you put your hand up, you’ve got to want to do this.”

Burnham has got a “very good antenna,” O’Neill added. “He’s very street savvy. Quite often people in Whitehall and Westminster sort of live in their own little cloud. And Andy can handle the streets and that in itself is really important.”

Reset watch

O’Neill, whose new BRICS+ Thinking platform aims to bring together economic and trade expertise, called for greater engagement between the U.K. and the emerging economies, claiming the U.K. has “failed to listen to them in the decade since the country voted to leave the European Union.”

During the Makerfield by-election campaign, Burnham ruled out the option of the rejoining the EU, despite saying last September that he would like to see a return to the bloc in his lifetime. O’Neill however revealed that would support re-joining under the right conditions.

“Yes, I would [support re-joining], but I think it is very important that some leader in this country finally wakes up and does something serious about the deeper issues that affected so many people that wanted to blame something for them not sharing in prosperity for the past 30, 40 years.” But he cautioned that the “conditions needed to be right” for rapprochement with the EU.

The Starmer government expended vast effort to strengthen ties with the EU. O’Neill described his own position as a “modest Remainer because I thought it was a crazy decision to leave economically, but I did think the shock of such a decision might wake us up on both important domestic issues and that the UK might really boldly lead a path…of getting real,” he argues.

Anne McElvoy’s interview with Jim O’Neill will feature on this morning’s edition of the Politics at Sam and Anne’s podcast.