Public Policy Conjectures

Where the vision faileth, the people perisheth  Proverbs 29 v 18

What sort of Vision?

This is a vision of solutions to problems. It is not problems focussed: because we all know the problems and we are tired of hearing them.  Rather, look at it this way: there is no point in having problems without solutions.  So here, we discuss solutions!

Secondly, it is a different vision about how we do things. There are no £ signs here, though the vision is also to achieve economic growth and income re-distribution.  It is about moving resources—real resources of people, materials and time.  It’s what people do in an emergency, small or large.  It’s what nations do in natural disasters and at war.  They don’t have the money, but they just get on and do it.  And that’s what Britain needs to do.

Thirdly, it is about doing a lot of different things together, in a cohesive and compelling way: not tackling them individually by silo politics in a hostile market. 

But this Vision for Britain must needs open with a paragraph to summarise our problems.  Otherwise, it will not be clear what I’m addressing.  The paragraph is very short. There follows an equally short paragraph to summarise the solutions to be discussed and proposed. Then a longer, but not too long warning about our limits.  Then we can plunge into action and solutions.  

Here we go!

Lack-a day me: the UK’s woes!

No economic growth; or very little indeed; a stagnant economy: these are some of the accepted ways of characterising the UK economy since the banker-produced crisis of 2008.  There seems to be general agreement on this.  Besides, even Boris Johnson in one of his few luminous moments, repeated the fact that we are a low-wage-low-productivity economy and nation.  Indeed, wages are so low that some people can’t afford an acceptable amount and quality of food and nearly half our households cannot afford a roof over their heads.  To boost incomes, we have a welfare bill that is vastly too high and damages our public finances and burdens us all with extra tax.  The public services are so run down that we believe that Britain is broken.  Public and private investment is low and has been too low since probably the 1880’s .  (This has also not been helped by two world wars, the inter-war depression, the bankers’ crisis, and latterly but briefly a plague)  Consequently we have high public and private debt.  We bewail our state, wring our hands, and say we haven’t got the money. As Eccles used to say, “Min, we haven’t got the wood!”

We must also recognise that rates of economic growth decline as countries develop; that the first charge on such growth is an aging and growing population; and further, that the workforce available is declining relative to population.   

The solutions seem to be these 

We do a whole raft of things at the same time.  Over the same timescale. 

We increase low wages by persuading employers into paying more through the minimum wage and by other means. With increased wages, poorer people buy more goodies, and we reduce the welfare bill and taxation. By this means also, we take housing and housing benefit out of the public sector for ordinary folk. We also take most pensions and social care similarly out of the public sector.  We free up a whole raft of wasted resources, particularly in finance and in quasi- monopoly services, and redeploy them to value-adding goodies in the real, not the financial world.  We make full use also of the wasted NEET lives and the labour released by A.I (if there really is much).  We fill all those new jobs that the Industrial Revolution has always spawned, and we benefit from the goodies they provide.  We vastly increase private investment and also public investment in step with redeploying wasted resources. We engage in this mission our strategy for climate change and a new strategy to reverse the North South divide — greatly aided by reducing pressure on the South.  This whole raft of things stimulates economic growth. 

We turn our nation round.  It will take many years. 

After some caution in the next few paragraphs, about limits to economic growth, I will outline the principles of the Vision and 10 strategies to achieve it.

Limits to turning our nation round  

Let us be quite clear: the limit is not money.  Solving our problems will only be achieved by realising it is about people, workers, skills, investing in factories or services, materials such as wheat, cotton, iron ore, and time—yes time.  Note, there are no £ signs here.  They come later.  Get the real things right, and the money will flow. It clearly isn’t quite as simple as that —bond markets do matter.  But if we make the bond markets a bit more cheerful first, then we can perhaps sort them out!  And actually, we may find they won’t mind a bit of sorting, anyway.  As long as we chat with them first, and do it nicely. 

The first limit is the probability that future economic growth will be relatively low.  This arises from having 80% and more of the workforce in the service sector and not employed in agriculture and industry.  Consequently, the scope for replacing labour by machines etc is now very limited.  But such replacement has been the whole basis for nearly 300 years of economic growth, of the industrial revolution.  It is now running out of steam.  

With so many services such as nursing, teaching, personal trainers, eating out and holidays requiring human personal services, then it is not difficult to see that replacing these workers by machines and freeing them up to provide extra goodies for us is generally impossible. Yet, as I say, this is how we have achieved nearly 300 years now of economic growth in the UK.

We do all need to understand and accept that the last 300 years of economic growth have been absolutely unique in say 7,000 years of civilisation —living in cities.  Before the mid 18th century, annual economic growth was erratic and minuscule in comparison to the last 300 years. Centuries of regression were also experienced.  There is also no law of the Medes and Persians that growth will continue in developed countries. ( Less developed countries have good prospects of economic growth if we manage the world well. )  There is also no law that our standards of living will not be swept away by natural or man-made destruction within the next 100 years.  

Let the end of the Bronze Age in the Middle East around 1200 BC be a lesson to us all.  It is only very recently that historians have been able to produce any convincing theory for its quite sudden demise.  But with the help of archaeology and scientific advances, a theory has now been formed.  It is now thought that the Bronze Age came to an end over say 200 years, as the result of climate change, earthquakes and complexity, yes complexity!  It was a quite complex and fragile economy and society.  Whilst earthquakes are peculiar to the geography of the eastern Mediterranean, climate change and complexity apply with a vengeance to us now.  We know the threats of climate change.  We are yet to realise just how fragile our complex society really is.  There is pretty little resilience on a world scale. But we have some indicators in the strains of climate change, plague, oil and energy threats, major computer system failure and computer crime, now A.I, worries about human activity in inner space — and also plastics — and not forgetting nuclear obliteration.  

On the other hand, there is every sign that mankind can manage climate change and other shocks, if we put our minds and our resources to it.   We do not have to be pessimistic—simply realistic and get on with it. 

The second is that with current birthrates and increasing lifespans in the West, there is a reduction in the workforce and an increase in the non-working population.  That means fewer workers have to produce food and all our goodies, yet for more people: more hungry mouths.  Because of the younger age of immigrants, reducing immigration reduces the working population and makes that problem worse.  On the other hand, immigration is only a short or medium term solution.

The combination of these two factors is that a first charge on lower rates of economic growth will be the production of existing levels of goods and services per capita by a smaller workforce. 

We as a nation have to live with these two factors and their combined effect. This is living within our means.  But note again: there is no £ sign around.  It’s not money that limits us, but real things: the number and types of people and our lifespans—and other real things like skills or iron ore or time. 

The next crucial point to make is that, since the advent of the Industrial Revolution in the mid-18th century, nearly 300 years ago now, there has never been a shortage of jobs.  And in the USA, the big problem always was a shortage of workers.  So why do we get so excited about no-one having a paid job? There are masses of jobs out there waiting to be done if we could find someone to do them. 

The big problem is moving from one job to another: from the land to the factory, from the factory to the office and to services. Now, with A.I, we have workers moving from some services to others.  New ways of producing goodies results in loss of jobs and, at the same time, huge opportunities for both the private and public sectors to supply new extra goodies. The transition is  always difficult publicly, and traumatic personally.  Redundancy and the break-up of communities is always bad and sometimes calamitous.  We see the results today in various places, especially in 19th century seaside towns, in the still derelict dock areas of north Liverpool, in pockets all over the country.  We focus rightly (but not enough) on these needy areas, and also forget the good side, the new jobs which do eventually take care of workers and restore them to self-sufficiency and self-pride. 

There has never been a shortage of new jobs. There is an insatiable demand for more personal services: health, social care, domestic help, nail bars and the like.  There is also an insatiable demand for leisure services, and for education. 

So, in my view, there is and will be no shortage of jobs for all the redundancies of A.I and all the wasted talent of those not in employment or training (NEETS).  And experience—I call it history—is on my side! 

Lenin: What is to be done?

A summary 

I will discuss solutions in more of a visionary way before outlining these 10 strategies.  

1    Economic modelling of this proposed programme 

2    A 20 year programme of redeploying wasted resources

3    Responding to climate change and tackling plastics

4    Establish a North/South divide and Southern restraint policy 

5    Private sector investment  

6    A 20 year programme of raising wages and incomes

7    A 20 year programme of reducing benefits 

8    A 20 year programme to create a society where food and housing are paid from the income of each person and family, and pensions and social care in old age are paid from their savings

9    Public sector investment and day to day spending 

10  Continuing to promote high tech etc 

Vision

We talk about vision a bit, but no-one produces one.  And when there was an attempt to do so by George Brown, everyone feared the idea and poo-poo-ed it. Yet Britain has had times of vision.  The most obvious ones were in the two world wars.  But the far more important and durable ones were empire, industrialisation, Victorian optimism, the Welfare State and Neo-liberal economics.  The Romans, King Alfred and William the Conqueror also had very effective visions.  Medieval kings from William the Conqueror had visions of ruling France as well as England.  The idea really died with the Tudors, but was not wholly accepted as daft until the 18th century, when the Royal Coat of Arms no longer proclaimed the sovereign as King also of France.  (We do seem to have a habit of hanging on to greatness long after the Emperor appears to the rest of the world as having no clothes. ) I can’t identify any other major visions for Britain in the last 2,000 years.  Religious visions have been incomplete and inconsistent.  Perhaps Elizabeth I had a vision for the Church of England: it has certainly endured and, to my mind, is overdue for revival if anyone can find the right cause. The Protestant Work Ethic is perhaps a vision. These visions to a greater or lesser extent were the visions of the entire nation.  And that is the sort of vision we now need. 

But not only have we had national visions before, but so have many other nations. Here are some examples. 

The Meiji Restoration in Japan from 1868; Attaturk in Turkey from 1922; in both Japan and Germany after the last world war, and in the reunification of Germany in the 1990’s.  We see it on a vast scale in the resurgence of China today; the whole nation, 1 billion of them, are united in restoring China to its former world status and glory.  But it happened also in Italy in Il Risorgimento in the mid 19th century and in Germany around the same time; also in Victorian Britain, and in many empires and national movements of world history.  The colonial movements for independence from Great Britain from around 1900 were major examples.  

“Where there is no vision, the people perish,” says Proverbs. And vision is totally lacking in the UK and in the USA.  The barbarian destructive urge which is strongly in evidence and creating havoc in the USA is not vision.  I suppose a case can be made for rape and pillage as a vision.  It worked well for the Vikings until they realised, as do the more intelligent of barbarians, (not Trump), that grander visions are vastly more profitable. 

The vision that is needed is a vision to solve a range of our problems, but expressed in terms which can be understood by all and which address publicly expressed need:  such basic matters as low wages, housing and taxation, and down to pot-holes and clean rivers—and climate change.  

Vision is not short term.  It is long term. It requires determination and hard work, even sacrifice over a long period.  Quick fixes are out.  Transformational, hitting the ground running, punching above our weight, it won’t happen again, are not on the agenda.  Nor is see it say it sort it. They are silly. 

It means harnessing a number of separate things together.  Instead of pursuing them independently, we see how they are inter-related, and how pursuing one, can boost another. 

This particular vision is one of tackling a group of our big problems in an integrated way.  It is one of grasping the opportunities that are there to be grasped—not just new technology, but redeploying resources, and achieving several aims with one group of actions.  The vision is not based on an ideology or economic theory or on religious belief.  These are being tried somewhat unsuccessfully in Iran and copied equally unsuccessfully in the USA. 

It is a vision for combined action of everyone, of the entire nation.  And the whole nation is us, our community.  Our community contains smaller communities (including businesses). But we organise ourselves into one community which we call the state.  We get 650 representatives, MP’s, to run our state: and we have a monarch who personifies our state and our commitment to it. The state is us—not some separate being, a tax-demanding monster.  MP’s and the government run the state to deliver for us.  With vision that delivery can be far better.  But government is good; and even taxation is good—otherwise we would have abolished them both years ago.  So we can make use of them to deliver on a vision.  And to do that, they need to be in partnership with individuals and with other communities, notably the community of the private sector, to which I now turn.    

Partnership with the private sector is the story of civilisation.  By civilisation, I always mean “living in cities.”  Cities have been widespread for 5000 to 7000 years now, perhaps longer.  Living in cities requires communal action: walls for defence, roads and sewers, regulated markets, even  common time measurement, law and order, armies, division of labour, administration.  Pharaohs built grain stores against famine—and also no doubt for their own enrichment.  Romans built roads and swept pirates off the seas—often in major wars, as in the Balkans. They subsidised corn supplies for half the inhabitants of Rome.  Elizabeth I financed merchants and adventurers in dubious trips around the world. The King of Bohemia paid desperate unemployed workers to build extra walls for Prague—to avoid starvation—early Keynesian economics.  You can see them today from the Charles Bridge.  In the 18th century, Britain bailed out the East India Company because it was too big to fail—- like the state did the banks 20 years ago. The private sector thrived and the public sector was able to deliver peace and sewers, because they worked in partnership together.  No lasting empire or nation survived without such a partnership.  The whole idea that one was the product of the other has always been a nonsense.  Yet we have believed that nonsense in the UK and the USA for the last 40 plus years. The vision set out here will not be achieved if that misbelief endures any longer.  It must end.

This means that the vision can embrace us all, individuals and community, private and public sectors in partnership. And if we wish, we can all embrace and own the vision, like the Chinese do today.  But if we do indeed embrace it and work towards it, we will all work in partnership.  As someone said on Peter Hennessy’s last interview, if we all want to fight cancer, or in my case help young carers, then we just join together and get on with it—no matter what our religion, ethnicity,  politics or social class.  We ‘do’, as Lenin said, and then we achieve things and find ourselves united.  “Do” together first — and unity comes. 

This nation needs a vision—a convincing and compelling vision.  I don’t mind if it is not mine.  But it has to be convincing and compelling.  Our recent political history has featured Big Societies, Brexit, New Labour, returns to Socialism, Nationalism, even Austerity—all compelling, but unconvincing, even from the start.   Both the Welfare State and Neo-liberal economics have run out of steam. I think the one has to be rejuvenated and the other seriously overhauled.   

There’s a demanding list of things to do a few paragraphs above. It’s worse below! Nothing in the list is obviously bad, wrong or mad. Some are much more difficult than others.  Some make more demands on some people than on others.  They are all policy changes or policy accelerations of the kind that governments generally consider.  No new “ism” is demanded.  No great re-organisation.  No great threats to the rich—but certainly a demand on all of us to care more for people, society, the environment, and the world: to care more for each other. 

So the vision itself is demanding.  As it’s mine, it will also need some radical change, and is in great need of expert input, particularly from economists!  After them, I will let finance wallahs like me near it.  But here it is for what it is worth in the form of 10 strategies or commandments!

….these 10, written, ready to be published weekly or maybe more frequently

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