Starmer’s Labour government defined itself by its “hard choices.” The phrase has served as the drumbeat to nearly every decision taken since the general election last July. The underlying claim is not so much that the previous government was intentionally reckless, but that it abandoned the levers of responsible state authority — on immigration, welfare, crime and the economy. Labour was to be the government that really did “take back control.”

The central difficult decision was a cut to winter fuel payments for millions of pensioners, restricting eligibility to only those who qualified for pension credit and other means-tested benefits. Following the disappointing results of the local elections, however, the Government has been considering a U-turn on its controversial policy, amid warnings of “Labour’s poll tax” further reducing the party’s support.

“We took difficult decisions, but the right decisions, at the budget, including the decision that we took on winter fuel,” Starmer told reporters during his trip to Albania last week, as he refused to deny he was reconsidering the policy. “We are now seeing the benefits of that in the interest rate cuts and the growth figures. They were difficult decisions but the right decisions.”

The policy, alongside some of the other hardline measures taken by the Government, has long been unpopular with Labour MPs. Letters have circulated attacking proposed welfare reforms, and some junior ministers have threatened to resign in protest. But Number 10 is not contemplating a reversal because of internal pressure. Labour’s substantial parliamentary majority dilutes the risk of defeat, and Starmer’s war on the Labour Left since 2020 has secured his internal position. The calculation is electoral. The decision may simply have been too harsh for the public to bear.

Dissenting MPs would be better off donning a wig and fake glasses and joining one of Morgan McSweeney’s focus groups to express their displeasure. That’s where the real feedback is taken. Number 10 is still trying to read the public mood, weighing its instincts for discipline and restraint against the emotional cost of cuts. The public rejected the Conservatives for economic chaos. But winter fuel cuts may have crossed a line. Labour is now searching for the fiscal space to reverse them.

Cuts to winter fuel payments — and the retention of the two-child benefit cap — always jarred with Labour’s instincts. The focus on hard choices has often felt less like strategy than theatre: sacred cows slaughtered to prove Labour’s seriousness, with little clarity about the destination or benefit for the poor and vulnerable whom the party is meant to support. If a U-turn comes, it will be less a moral reckoning than another sign of a party nervously calibrating how to hold together the coalition that gave it victory last year. It may work. But a government without motivation is a government without direction.

Historically, Labour always positioned itself as a movement of national improvement, propelled less by fixed doctrine than by competing ideas of motion and destination. For all their differences, the party under New Labour, Miliband, and Corbynism shared a belief in progress. Each saw politics as a means of ascent. Starmer’s government is different. Wary of the associations with Corbynism and of suffering the same fate as the Conservatives, it reiterates its responsibility at the expense of all else. There are no uplands in sight, no central promise of hope to convince the skeptical. It sees crisis not as fuel for change, but as a blaze to be contained.

Before the general election, the party abandoned its commitment to economic and environmental reform for this very reason. Nearly a year in, it is still looking for a workable arrangement with public opinion. If Labour changes its political strategy for electoral ends, however, it will have taken back control only to keep Britain standing still.

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Angus Reilly is Assistant Editor at Engelsberg Ideas. He is writing a book about Henry Kissinger in the Second World War and a biography of David Owen.

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China is trying to catch up with America on artificial intelligence. The Wall Street Journal has reported that Zhipu AI — one of China’s six “AI tiger” LLMs — has released a new model that can rival leading US systems, including Anthropic’s Mythos, in cybersecurity tasks such as pinpointing security bugs. While this marks a milestone in China’s drive to catch up with Western AI capabilities, strong performance on a single benchmark does not mean it has taken the lead. Chinese models still lag behind their Western counterparts in broader capabilities, such as autonomous operation. Skepticism is therefore warranted before resorting to hysterical conclusions, but complacency about the geopolitical implications of China’s AI advances would be an even greater mistake.

On the infrastructure side, Chinese AI is still constrained by access to advanced chips, with American labs way ahead in computing capacity as well as investment. Analysis from earlier this year suggests that Chinese models are likely to be at least a few months behind those in the US. But they are still continuing to make progress, or that the geopolitical importance of AI will be decided only by whose LLM has ventured deeper into the technological frontier. The practical applications of AI, countries’ to capture foreign markets, and the application of AI into the real economy will matter just as much.

Here, China may hold an advantage. As with its dominance across many critical supply chains, Beijing may not need to produce the most advanced AI systems — only those that are affordable and widely deployable. In doing so, it could consolidate global influence by supplying functional, low-cost AI at scale.

Beijing seems to be pursuing exactly that path, developing an AI “open-source” strategy that offers affordable, widely available AI models for companies and individuals to use and modify as they wish. The production of the DeepSeek AI model, which matched the performance of Silicon Valley tools such as ChatGPT at a fraction of the cost for users, created goodwill among Chinese models with developers.

The four most popular models on OpenRouter, an AI hardware platform for developers, are now all Chinese. The goal for China is not only to win the frontier-model race, but to make its systems the default layer of AI adoption across industries and global markets. For most economies, the choice is increasingly between an affordable tool they can deploy now and a more robust one that may be out of reach.

And while the countries adopting Chinese models may be exposed to political pressure and cyber threats from Beijing, safer and more capable alternatives matter little if they are unaffordable. American AI companies are already under pressure to monetize products whose operating costs are rising. If Chinese open-source models become the cheap default for startups, universities, governments and businesses across the developing world, then America’s AI lead will be eroded from below.

Perhaps more concerning for America in the long run is how AI can give Chinese manufacturing even more strength, through the ongoing integration of AI as a general-purpose technology. China’s new Five-Year Plan mentioned AI more than 50 times and includes an “AI+” action plan aimed at spreading AI across the economy.

Beijing has been pioneering automation of its critical infrastructure for years, with promising recent results in increasing warplane production capacity. In that regard, China’s open-model strategy and manufacturing dominance will reinforce each other. Cheap, adaptable models accelerate deployment across the real economy while those deployments generate real-world data and use cases that can feed back into further model improvement.

The United States should not dismiss the importance of its lead in the AI race. That lead worries Beijing, not least because a more automated Chinese economy would also become more vulnerable to AI-generated cyber threats. But nor should Washington assume that China cannot catch up with American capabilities over time.

This AI competition represents part of a broader struggle over tech supply chains and geopolitical influence. Decisions over whether to adopt US or Chinese models could produce a more fragmented global reality, with different regions relying on different cloud providers, chips and security structures. The result will likely be a global economy which is divided into competing spheres, rather than one which produces a single winner.

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Miquel Vila is a political and geopolitical risk consultant focusing on industrial strategy, critical infrastructure and global supply chains.

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