Eastbourne, just a few miles away, is doing fine. So is Bexhill. The town is surrounded by typical Homes Counties villages. Rye, just ten miles to the east, oozes prosperity. So what is the problem?

It isn’t lack of position (Southend and Blackpool have none). And it isn’t a dearth of good property. Victorian terraces abound, filled with houses and flats that no-one wants to buy. It could be something to do with the missing hotels (not an AA 5-star in town), the non-existent conference centre, the vagrants begging in the streets and the general feeling of misery.

I don’t believe it has anything to do with the railway for one moment. Hastings is no worse off train-wise than Worthing and Bognor Regis, and is in a far better position than Selsey, Swanage and Lyme Regis, that have no trains at all.

We excluded Manchester, Leeds and Newcastle because they have structural advantages (size, skills mix) that other places do not have. That they have seen real regeneration does not imply that the same is possible for Blackburn and Sunderland, because these places do not start from the same position as M, L & N.

You are right: our finance v cotton sentence would have been stronger had we said “Blackburn” instead of “Manchester”.

Location also explains Newcastle’s advantages – it is top dog in its area, in a way that Hastings is not. For historic reasons Newcastle has a reasonably good skills base, good train line, and relatively little local competition from other towns and cities. It attracts skilled people who want to stay in or move to the area, because it is a metropolitan centre with the standard attractions that metropolitan centres offer. Hastings doesn’t do that and nor does Sunderland (or not to the same extent).

David Davies argued that we should look at GVA per head, not GVA. He is right -and we did! This was clear in Cities Limited, but the words “per head” were omitted in Cities Unlimited (my fault). I wrote to him to offer to discuss his criticisms of our stats, but he did not reply. He is right that Liverpool and Sunderland do better than the average of our sample, but as you suggest, this implies that other towns are doing worse. Averages are like that. We wanted to use an average so that we could not be accused of picking on a town or city, and because sub-national accounts are hard to construct, and the figures for individual towns have significant margins of error that are reduced by using an average of a number of towns. In Cities Limited we list lots of other independent reports that come to the same conclusions: the gap between successful and unsuccessful towns is not getting smaller.

As a quantitative academic I take criticism of my numbers very seriously, and am always willing to discuss them, and retract errors as and when necessary.

Or maybe it’s shaming for the Tories for a Lib Dem to have been associated with this report?

I’m confused.

If we want declining cities to end up like Detroit, the current way of spending regeneration money trying artificially to prop up those falling populations is the right way to go. But it’s neither liberal, nor liberating.

Many of the Pathfinder housing projects have handed vast sums of money to speculators while blighting areas just as much as depopulation could ever do. Is that supposed to be good for anyone other than those leeching speculators?

I’ve got a different report for Giles – let’s spend all regeneration money building a big electric fence around towns and cities whose population has been falling and prevent anyone else from leaving. Mean time, don’t build any more housing whatever south of the Wash so that nobody can afford to move south even if they happen not to be in a gated city (nor anyone on a housing list in an expensive area ever have the prospect of getting a decent home). That should do it.

I’m glad the report came out if only to spark the debate.

As for objecting to the notion that taxpayer’s money should be spent as efficiently as possible on regeneration… er, why are you objecting to that exactly?

I suggest you wait for part two. The whole point of me bothering to read the report and regurgitate its main points is so that you don’t have to carry on believing the utter nonsense the papers spew out. Since when do we uncritically believe everything they say?!

Please stay open-minded.

Stupid academic nonsense!

Unadjusted and per capita GVA growth rates measure different things, so Daniel Davis is making a false criticism of the report by stating ‘living standards have not declined’, when he is really attempting to say that the report didn’t ask the questions he wanted.

Davis’ preference for per capita GVA growth rates suggests he is really interested in the effectiveness of the spending, whereas the Policy Exchange group seem to have used the unadjusted rate to draw conclusions about the efficiency such spending has had for the wider economy.

Davis is arguing that the spending was necessary, Policy Exchange was arguing the money could have been spent better.

Of course both are right in essence, but both are wrong in opposing the other – the political challenge is to navigate a way between the two.

In which case today’s Eurostat annoucement that the population of the UK is set to rise by 15 million by 2060 (making our little island more heavily populated than Germany) should be recieved warmly as a way to reinvigorate regional planning and development in the country by uniting the interests of both northern urban centres and southern shires (although I doubt Labour and Conservative will be happy about all those new immigrants and children).