FATAL FLAWS - INABILITY OF THE BRITISH (AND AMERICAN) CULTURES TO FOSTER ECONOMIC COLLABORATION.
If the major stakeholders in the British economy cannot collaborate, tackling industrial regeneration seems a forlorn hope and long term decline will accelerate.
At a conference on manufacturing: encouraging agreement on the economy from many stakeholders
I went to a seminar about the state of the British manufacturing economy last week. There were speakers from the Society of Motor Manufacturers and Traders, the opposition Labour Party spokesman on industry, the General Secretary of the Trades Union Congress, the head of a major engineering consultancy and a prominent academic. Each speaker was quite clear about the causes of the decline in technology and manufacturing - lack of investment, governmental indifference favouring the financial and banking sector and an alarming decline in skills at all levels.
They were equally passionate about the effects - the continued decline of the British economy and its relegation to second class status; a spiral of decline in the balance of trade and employment opportunities in skilled occupations - and a secular decline in prosperity of all regions of Britain except London and the South East.
When it came to the remedies, there was general agreement that new investment vehicles were needed to supplement or circumvent the banks and the City of London; that big incentives were needed to encourage investment- and particularly important - that government could not stand back and expect "the market" to solve the problems. They also felt strongly that the problems would not be fixed if only taxes were lower or employment regulations decreased, although the industry representatives supported both. All speakers wanted the government to take a strategic role and participate actively in stimulating re-construction of the decimated technology sector - and offer sector-specific incentives and investment resources.
But, the fatal flaw...
It was very encouraging to hear such unanimity from actors representing pretty well all stakeholders in the economy. These prominent people were able to agree and listen to each others' points of view without a trace of conflict.
But, alas........ In the "real" world of politics and industry there seems little chance that politicians, bankers, industrialists, trade unionists and prominent academics can work together on a national strategy for regeneration and reconstruction of the economy.
Britain has no history of such collaboration outside of two World Wars when industry performed wonders of production and innovation. And when the threat to national survival was over, the country slipped back in to old habits of conflict and schism - class warfare flared up, industrial relations became even more conflictual - and a new force emerged in Trade Union "Barons" who supplanted "Bosses" in the corridors of power. So the long term cycle of industrial decline continued.
Now, it is the Bankers who have supplanted both the unions and industrialists in wielding destructive power.
The culture of divisiveness, conflict and inability to mobilise collaborative effort seems to be an over-riding problem in both Britain and America - literally preventing the enactment of coherent long-term renewal strategies. Instead, Britain is crippled by privilege and inequality; leading to mutual suspicion and divisiveness between different strata in society.
The effects of this and other cultural factors mean that Britain is a conflicted society in which it is exceedingly difficult to mobilise a long term consensus about how to address fundamental economic and social problems. This factor enables strong unified forces like the investment banks to divide and rule and avoid any real responsibility to the wider Society.
Britain is facing a slow burning and deepening crisis as threatening to national well-being as the two World Wars. At the current rate of decline, Britain will have lost most of its remaining advanced technology industries and be an insignificant player in the world economy within a few decades. Advertising tycoon Sir Martin Sorrell recently described Britain as "Third Division", preferring to focus on growing economies in South America or India.
People in committee rooms can talk until the end of time, but nothing constructive will get done unless different stakeholders in the economy can collaborate and force governments to take consistent and very long term action to tackle the roots of the problems.
I put some questions to the people on the platform: Why was it not possible in the real world to create vehicles to enact the kind of agreement which so obviously existed in Committee Room 10 of the House of Commons? Why could Britain not find its own version of the Scandinavian model of collaboration?
The response seemed to be impatience and indifference - people seemed much more willing to talk about what was wrong in ever-increasing detail rather than the crucial question of how the deepening crisis of the British economy could be addressed.
To me, but obviously not to others, this smacks of squabbling whilst Britain decays.
