Reflecting on the remarkable transformation of Germany’s economy after the war, Ludwig Erhard, its principal architect, lamented that people had taken to calling it a “miracle”. What had taken place in Germany was nothing of the sort, he wrote: “it is the result of the honest efforts of a whole people who, in keeping with the principles of liberty, were given the opportunity of using personal initiative and human energy”. Economic growth in his view did not come from astonishing acts by government, but through the commonplace acts of millions of individuals and families.

In her recent Mais Lecture, Rachel Reeves set out a different view: that an “active” (and now indisputably big) state can underwrite the security of businesses and individuals; that this will provide a “platform” of safety from which all might derive greater certainty and confidence; and that this will drive sustainable economic growth. She wants the state to “de-risk” investment, to ban zero-hours contracts, to increase the security and pay of those in lower productivity sectors.

“Securonomics” taps into a powerful sentiment that has developed in Britain: that as a society, we are more exposed, more vulnerable, more brittle than at any other time in recent memory. And there is surely more than a grain of truth to this assessment. Since 2008, the UK has been subject to a panoply of external shocks, from the Great Financial Crisis to the coronavirus pandemic and energy price inflation borne out of the war in Ukraine.

Insecurity in our society is not merely geopolitical or macroeconomic, either. Reeve’s quotes Bernard Williams, the liberal realist who contended that the most important responsibility of the state is to answer the “first political question” posed by Thomas Hobbes centuries ago: that of securing “order, protection, safety, trust, and the conditions of cooperation”. Crime might in the long term be on the decline. But the sense that our streets are no longer safe, that we are not all policed “without fear or favour”, that one’s shop might be looted with impunity, is pervasive. The state is manifestly failing in these responsibilities at present.

Nevertheless, Reeves is the Chancellor in waiting, not an aspirant Foreign or Home Secretary. Is our economic malaise best understood as deriving from too little security? And is it the state that is best placed to underwrite increased economic security?

The fulcrum of Reeves’s case is that when it comes to the economy, security and growth are coterminous; that by making people more secure, the state will in turn stimulate growth. The logic is seductive. But the question turns on who or what is providing that economic security. And time and again, when the state has sought to provide it, the consequence has been an expansion of the state and its activities and a corresponding stultification of economic activity.

Our approach to healthcare offers one of the starkest illustrations of how state interventions to provide safety or security can come with unintended consequences. With the founding of the NHS, it was presumed that free health care at the point of use would “diminish disease by prevention and cure”, and that costs would therefore fall or at least stabilise over time. Yet the precise opposite has occurred. A blank check from government has stimulated demand for spending on healthcare, not reduced it. The lesson is that state dependency vitiates personal independency — the very thing that fosters the innovation and enterprise we require to truly deliver economic growth.

Security and growth are not coterminous, of course. There are compromises and trade-offs to be had between these two imperatives, and frequently we have privileged the former over the latter. This is true, for example, in the pensions industry, where regulators have increasingly encouraged funds to invest in lower risk and notionally more “secure” assets like bonds, and away from equities with higher short-term volatility but greater long term returns.

More acutely, it is the case with our planning system, which the Shadow Chancellor has said Labour will overhaul. If we want a way of allocating land use that better supports growth, we are going to have to ask people — homeowners, voters — to give up the security that comes from having effective veto powers over new development. There’s no two ways about it.

These are not objections to seeking to improve people’s sense of security itself, but to the potential consequences of an active state trying to guarantee it. A genuine strategy for increasing our economic security and resilience as a society would not start with the state. It would start with individuals and families. It would promote and support self-sufficiency through higher savings, which would in turn beget greater resilience in household finances and support a more robust funding model for investment in this country.

And it would seek determinedly to spread ownership more diffusely through our society. Property provides perhaps the most important form of security a household can possess. It is a reliable store of value, a source of independence, and something to pass on to future generations. Reeves cited the great political economist Karl Polanyi in her lecture, and his theory about how economic systems can become detached from the societies which play host to them, with damaging consequences for social cohesion. Surely the best way to plug our economy back into society more broadly would be to greatly expand the number of people with a genuine stake in it.

As Reeves herself put it, any strategy for the state’s activities must be selective. It must make choices about where it intervenes, and how. And it must be conscious that intervention in certain areas might have unintended, deleterious consequences. Our great problem is that the state has left undone those things that it ought to have done, yet done those things which it ought not to have done. And as such the size and reach of the state has continued to expand whilst its effectiveness has diminished.

On the eve of Thatcher’s election in 1979, Jim Callaghan put it that “there are times, perhaps once every thirty years, when there is a sea change in politics. It then does not matter what you say or what you do. There is a shift in what the public wants and what it approves of”.

Such a sea change is clearly taking place today, as the tide of ideas in this country has swung towards a strong desire for security and safety over freedom and enterprise. Securonomics did not produce that shift. It merely reflects it. But it is not clear that this will necessarily drive the more dynamic, prosperous Britain that we all desire.