Saturday 26 August 2023

Declinism demonstrated


The previous post argues that to stop the rot in the quality of our government and lives and achieve the modest competence worthy of a rich developed nation we need to ditch our arrogant delusions of exceptionalism and subject our institutions  to root and branch examination and fundamental reform.

Should there be any doubt as to the reality of our exit from the list of leading nations some figures cited by an Edinburgh GP, Gavin Francis, in a “Long Read” in last Thursday’s Guardian (24th August) provide the dismal evidence.

In 1950 the UK was in the top six countries for life expectancy worldwide.

By 2015 the UK had slipped to 21st.

By 2019 it had fallen to 29th.

Francis then cites an international study of NHS finance which shows that we are paying a lot less towards health than other comparable countries  (Australia, Canada, Denmark, France, Germany, the Netherlands, Sweden, Switzerland and the US)) and suggests that to argue that we cannot match the healthcare spends of such countries means that “the UK is now "too poor  to have a 21st century  European standard of healthcare."

Or, I would add, too mean, or too deluded by the economic legacy of what we have come to call Thatcherism

To halt our decline we must recognise the flawed nature of that doctrine, which can be summed up as:

Low taxation



Restrictions on collective action by trade unions

These were supposed to release the energies of our entrepreneurs and the resulting prosperity would trickle down to the benefit of everyone.

 None of the assumptions are verifiable.

 Taxation levels are much higher in many of the countries now much more productive than we are.

Regulations are necessary to protect us from fraudsters, opportunists and charlatans

The private sector is not automatically more efficient, however that is defined, than the public sector.

Restrictions on TU activities have not led to harmony in the workplace.  Quite the reverse.  Significant Employee Representation on boards and where appropriate, profit sharing, are more likely to do the trick. .

Yet the Tories still think the solution is tax cuts. 

As well as a root and branch reform of our systems of government (see previous post), we also need to ditch this failed  economic dogma which has now dominated our thinking for nearly half a century, and be prepared to pay for the quality of life and society of which we are capable.

Wednesday 16 August 2023

Naked Britain




In this article in Sunday's "Observer" (13th August 2023). . .

 . . . Will Hutton plays the role of the little boy in the Hans Anderson fairy-tale who points out that the emperor has no clothes. 

The facts Hutton enumerates come as no surprise to those of us who follow the course of Britain's economy but they give a concise picture of the UK's current economic situation which is dramatically different for that the Tories, their sycophantic think-tanks and supportive press try to paint.

Here's a summary (with any additional comments of my own in brackets). 

Unlike in previous times of economic difficulty:

·        we are no longer members of any secure trading relationship such as the Empire or the EU (and the much-vaunted promises of new post-Brexit relationships don't so far amount to much):

·        our international assets no longer exceed our liabilities (quite the reverse as a result of "selling of the family silver" to foreign holders):

·        much government debt is now short-term and debt servicing is vulnerable to short term interest fluctuations:

·        the current account deficit is enormous (about 6% of GDP I seem to remember having read somewhere):

·         we are no longer an industrial giant (thanks to Thatcherism from the politicians and short-termism from our "captains of industry"):

·         productivity is "wretched" (way behind the US, Germany and France and either the lowest or next to the lowest in the G7)

·        if we strip out the contribution of London, our GDP per head falls below that of Mississippi, the poorest state in the US.

The consequences of this economic performance, allied to the growth in inequality, have percolated down to the health and social condition of our society.  Hutton records that one in three of our children live in poverty, our five-year-olds are now the shortest in Europe, and two million people report going without food for at least one day in every month.

We are no longer the spanking-rich world leading country we like to pretend.

It is common to date this decline from the public spending “austerity” policies introduced by George Osborne in 2010 but I believe the problem goes back much further, indeed right back to the end of the Second World War.

 Jo Grimond, a junior officer in the War and leader of the Liberal Party from 1956 to 1967 puts his finger on it. In his “Memoirs” (published 1979) he writes:

 “…we came out of the war being told we had saved the world by a unique act of courage against fearful odds.  We naturally became convinced that the world must see that we were natural leaders of the West entitled by our deeds of valour and skill to rest on oars as far as work was concerned and owed a debt, indeed a living, by our neighbours. (page 99)

That delusion still exists. Indeed under Johnson it existed in spades.

The delusion had and still has two serious consequences.   We have failed to reform significantly either our methods of running the economy or the government, and we have failed to look to other countries for clues on how to do both better.  Why should we: ours are “the best in the world and  the envy of the world?”

To strop the rot and achieve, not, for goodness’ sake, world-beating leadership, but just modest competence as an advanced developed nation, we need to ditch these arrogant delusions  once and for all and subject our institution  to root and branch examination and fundamental reform.

In our system of government we need examine our electoral systems, the powers of our governments, parliament as an effective law-making body and monitor of government performance rather than  a forum for political point-scoring, serious devolution of powers - including tax raising -  to the nations, regions and local government, balancing the media and the funding of political parties.

In our economy we need to find ways of promoting long-term investment rather than short-term monetary gain from our entrepreneurs and funders, fairer taxation, measures to achieve an equitable distribution of incomes and wealth,  protect the vulnerable, change the housing market from the means to acquire a cash-cow to the provision of  somewhere to live, and in our education system promote respected and effective  method of achieving technical competence.

 It is a mammoth task. Such a programme will take at least fifteen years to implement.  A continuation of the two-party duopoly will produce the “mixture as before.”  A progressive alliance of Labour, Liberal Democrats, Greens and Nationalists might just “break the mould” (remember that one?) and  set us on the right track.