Unfortunately for anyone committed to sticking it out for the next few years, Labour seem to have all but abandoned hope of hanging on to lingering British dynamism. OpenAI recently announced that it would abandon its UK Stargate data centre plans, citing the exorbitant costs of energy and the maddening bureaucratic maze that stands in the way of building anything in Britain. While their competitor, Anthropic, seems open to Starmer’s suggestions to scale up its London presence, this has less to do with British competitiveness and more to do with the American Department of War’s combativeness.
Meanwhile, Skycutter, a domestic drone manufacturer, can’t seem to get a callback, and may now have to painfully decamp to America just to keep flying. As their operations director, Vince Gardner told the BBC, “We want to stay here, this is our home, this is where we’ve developed this technology. We don’t want to leave but the opportunities [in the US] are too great to turn down currently.” It’s not entirely obvious why, despite promised government support, the opportunities for a drone manufacturer would be on the other side of the Atlantic from Ukraine, unless, as Gardner says, any promised support simply seems slower than moving an entire company out of the country.
Making Tax Digital is going to do it for me. Six months to get around to doing an annual return? NO! Now it’s three weeks to get a quarterly return in four times a year AND an annual return AND having to trust your bank details and HMRC login details to a sealed piece of software. Sorry, no thanks. That’s me leaving the job market permanently thank you very much.
This is what happens when you soak the rich. The annoying thing about the rich is that they are far more mobile than the poor. One has to ask, aside from inertia, what is keeping people in Britain in the first place? There are many amazing places where they can decamp to and take their tax pounds with them. And in todays world where everything is digital and tomorrows world where even more of everything will be digital, that mobility just skyrockets.
However, I did read this article about data centers which talks about the growing opposition and NIMBY attitude toward building data centers in the USA too, and no doubt around the world. Which is why I think data centers will most likely end up in orbit when we have the capacity to deliver them, which probably means in the next five years. And of course there is literally only one company who has the capacity to do that at scale and they are about to go IPO. It is also worth pointing out that Tesla has a massively profitable business selling energy storage packs which could dramatically improve the average availability of energy generation capacity terrestrially for reason I think I have talked about before.
This is why I have changed my mind about things. I too was ready to decamp from the ridiculously high tax/high regulation USA, but the simple fact is that the technological revolution we are in the midst of is going to be based almost entirely out of the USA and China (and orbit, controlled by the USA). Britain’s Net Zero initiative is no longer a damaging idea it is now catastrophic idea, and existential threat to Britain. Since business is going to be run out of data centers now and many of the typical white collar jobs that form the heart of British industry (in banking, insurance and services) are just going to go away, and many of the ones that are left will be taken over by humanoid robots. This is true in the USA too, but the difference is that the new wealth will be generated in the USA, massive amounts of it, and the US government will therefore be able to tax it and use those taxes to defray the economic displacement. Not that I love that, but I am really more trying to be pragmatic about what will actually happen. And Britain? It will not be able to do that because all the wealth will have moved overseas, and all the jobs will be taken too.
This is very much like Britain, at the beginning of the Industrial Revolution banning the use of coal.
Is Reform going to fix this? I hope so, but truthfully I doubt it. Net Zero and similar insanity is baked into the very core of Britain and even were Reform to have unrestricted power, and ever were they to declare all out war on the civil service as PdH has suggested, it will still take decades to excise it, which of course will be far too late. But I hope I am wrong about this.
Europe will need these data centers too, but they sure as hell won’t be built in Britain. France maybe, probably not Germany, maybe Switzerland, and an interesting candidate is actually Iceland due to their ready access to very cheap power and cooling, though they need better connectivity. And beyond that I think there is a very good chance that the middle east will continue their energy dominance and probably a lot of data centers will be built there. But Britain has chosen the worst time in history to choose the “we hate energy” policy. “We hate energy” is exactly the same as saying “we hate wealth and prosperity.” That has always been true but is much more true today and in the next ten years than perhaps any time in history.