Liberal Democrats need to have radical solutions to collapse of industrial communities

It is with more than a little sadness and apprehension that I watch the drawn-out self destruction of the Labour Party, as its leader, a man who I once respected and liked, seems hell bent on bringing Her Majesty’s Most Loyal Opposition to its knees. The details of this destruction have been covered extensively in other places, and I won’t repeat them here, but one thread does deeply concern me as a liberal: the seeming blindness the Labour Party has to industry and the traditional worker.

Britain’s industrial past, I believe, played a key part in the result of the EU referendum, where those who feel disenfranchised by the crippling of their communities, and the industrial centre that were once at their heart, did what they felt they needed to in order to enact a change. Labour’s solution to this has, broadly, been to carry on as they were and to promise a restoration of this industrial past.

We live in an era of hard truths.

That industry, those factories, those warehouses and foundries and collieries, are never coming back.

By the time the market has chased industry around the globe, hopping from country to country to find those without robust human rights legislation that they can exploit mercilessly, the time of human industry will be done. We will have chased industrialism from nation to nation, leaving a legacy of unionisation and employment law in our wake, until the clock has run down, and humanity is no longer needed for industry to flourish. It’s not utopianism or science fiction anymore. When artificial intelligences can diagnose cancer, beat the world’s best Go players and plan cities with a terrifying elegance, we need to see it as just around the corner. Because it is.

Just as the industrial revolution left communities transformed or destroyed in its wake, so too does the technological revolution, the effects of which are only now beginning to be understood. Our society will be altered as dramatically as it was two hundred years ago, if not more so – the way we live, work, socialise and engage in government and politics is radically changing, and fast. The economy crashes and booms, national lines falter and are redrawn. Jobs disappear forever, and new ones unimagined rise at a blistering speed.

The Labour Party, ultimately, can’t deal with that truth. Half of them are stuck in 1997, and the other half in 1977. The Conservatives are no better, though they favour ‘87 and ’57. As a liberal, forward-thinking and innovative party it’s up to us to tackle the radical, destructive changes that are happening every day. We need to let go of the comfortable way of doing things, which we’ve honed the rut of over many years, and come up with new, breath-taking and radical solutions for the future.

We need to reach out to those people being left behind and help them step into this incredible, confusing and marvellous world of time zone tribes and distributed ingenuity. And if they can’t, or won’t make that jump, then we need to make sure that they’re not left to perish as they were in 1800, but give them comfort and peace as their way of life disappears forever.

* Edwin Moriarty joined the Liberal Democrats in 2016.

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23 Comments

  • Good stuff Edward. I agree that the social and economic situation which created the Labour Party has all but disappeared, hence the Party will disappear with it, Corbyn’s absurd nostalgia notwithstanding.

  • Yes, this is eloquent and touching…. but what steps, how, and with whose money?

    Hands up who is opening a start-up in Scunthorpe or Preston or Strood when they could do so in Leeds, Manchester or London?

  • I agree that we need radical solutions. Care to propose some?

    (Personally I think that this is exactly the kind of thing that a Basic Income would help with. But I am very open to other suggestions.)

  • Sue Sutherland 22nd Jul '16 - 12:08pm

    I agree Edward and I think the effects of the long term structural decline of industry played a major part in the Brexit vote. We need a pattern of community and individual support to follow when this kind of change happens. One small thing that I have thought of is to return land blighted by previous industry to the green belt, making it a resource for the local community. This could perhaps be funded by developers wishing to invade the green belt in other areas. The same could happen when housing is no longer needed because jobs have moved elsewhere. Local people could be involved in this activity which would provide a cushion for the destruction they have experienced.

  • Barry Snelson 22nd Jul '16 - 2:11pm

    “We need to let go of the comfortable way of doing things, which we’ve honed the rut of over many years, and come up with new, breath-taking and radical solutions for the future.”

    Edwin – these are key words and well put. I understand those who want to know what these solutions are but this country won’t be fixed in 140 characters or less and we could set a national lead, through our party, by working out these ideas through lengthy deabte and argument (like we used to do before Twitter).

    I hope you don’t respond with your thoughts on this public forum as both other parties could well be eavesdropping and have shown a shameless readiness to steal our intellectual property and re-badge it.

  • “We need to let go of the comfortable way of doing things, which we’ve honed the rut of over many years, and come up with new, breath-taking and radical solutions for the future.”

    Yes, but who are the “we”?

    As I’ve debated with Barry and others on the members forum in the past, Governments are very bad at “picking winners”, and centrally coordinated efforts to innovate are largely doomed to failure by being too little, too late, or just plain wrong.

    With all due respect, any self-selecting group of Lib Dems sat round a table trying to do the same will be equally wrong.

    In my opinion, the way forward is for Government to provide an environment where those with genuine innovative ideas can flourish, and then get out of the way. We should concentrate not on “us” finding the solutions for “them”, but providing an environment where a myriad of others, whether ordinary people, business leaders or academics, can exploit the human spirit’s inherent ingenuity.

  • Mick Taylor 22nd Jul '16 - 3:38pm

    As a former venture capital manager, I am acutely aware of the difficulty in getting finance for business. Venture Capital (VC) has to guess who the winners will be – and get it wrong more often than not – and then back them with investment. VC is not charity, though the fund managers take the same risk as the business and can lose everything. VC does get some bets right, but I would suggest no better than any group of people investing in a new or growing business. [Oh I know the fund managers do their due diligence – I did that for my company too – but still only make serious money in about 10% of investments]
    What the government could and should do is provide grants and cheap loans and tax incentives for people setting up in the very areas the article talks about. It can help with better transport links, better connectivity, rent and business rate holidays and so on.
    It should also be making it even easier for coops and social enterprises to set up (the coalition DID push through an act helping coops) and be prepared to provide short term finance for management buyouts and employee takeovers.
    The former metropolitan county councils did establish enterprise boards to assist in building businesses with some success. Certainly the West Yorkshire one is still going in a private sector form.
    There is also a need for more support for business spin-offs from universities and the provision of starter and growth units on and off science parks.
    It’s a mix of old and new, but the Lib Dems should not be afraid of a (limited) state role in fostering enterprise and using the states purchasing power to buy from businesses set up and run in the former industrial areas.

  • Edwin – absolutely right! We need to break out of our comfortable rut and find new, radical and better ways of doing things.

    There are many strands to this, each of which will require its own body of expertise to develop. But most important of all will be weaving those many strands together into a whole that hangs together and is greater than the sum of the parts. In short we need a paradigm shift and that’s always difficult. OTOH, once achieved, it will seem obvious because that’s how paradigm shifts work. Think the change from a Ptolemaic model of the solar system to a solar centric one.

    One practical difficulty is that for nearly 40 years Tory thinking has so dominated political economy (aided and abetted by their friends in the media and ‘courtiers’ in the economic fraternity) that’s it’s become difficult to imagine any other approach.

    Another difficulty is that the Lib Dems simply don’t have any mechanism to conduct the necessary national debate and are still locked into a top-down, process-driven, pre-Internet policy-making approach even though it has clearly failed as the voters have repeatedly tried to tell us. Even worse, the working party approach puts each element of the overall problem into semi self-contained ‘silos’ which works against achieving a vision that’s greater than the sum of the parts.

    However, I don’t agree with Barry Snelson that this debate should be conducted in a secret forum. For one thing we need to be open to the best and most original thinking irrespective of its source and that will mean going outside the party and into academia etc. There are actually a huge number of insightful people ‘out there’ who are deeply frustrated that Westminster is so wilfully deaf to their unanswered (because unanswerable) critiques of Tory neoliberalism. For another thing there is absolutely no chance that Tories as a whole will somehow convert to Liberals; we might drag the Overton Window back towards the more liberal end of the spectrum but that would be an entirely good thing that we should aim to do in any case.

    So how do we conduct the necessary national debate?

  • @Mick Taylor

    I think there is virtually no chance of a small-scale enterprise getting venture capital backing these days.

    I do think however that business spin-offs from universities do relatively well for support (that’s not to say more can’t be done). There is certainly far more support available for a university spin-off than there is for a non-academic entrepreneur with a great idea and a business plan.

    I agree about coops and social enterprises.

  • Conor McGovern 22nd Jul '16 - 5:09pm

    We clearly need a modern Industrial Strategy for the sectors of the future, with a small, strong, strategic Government capable of investing in and enabling growth. Andrew’s also 100% right IMO when it comes to a Basic Income. We could also be talking about a Four-Day Week. I’d like us to find a way to build a straightforward, 21st C safety net and protect people in their jobs, with proper rights and a big expansion of workplace democracy.

  • Until yesterday I thought that it was the 172 MPs who voted in favour of the no confidence motion in Jeremy Corbyn who were “bringing Her Majestry’s Most Loyal Opposition to its knees” but after watching Corbyn’s interview on Newsnight I think Corbyn has not understood what those voting Leave want. He seems to want to exclude directly limiting immigration into the UK. Unless the Labour Party embraces the idea that most of their traditional voters want to massively restrict immigration into the UK, I think it will lose seats in the next general election. Of course if the 172 MPs decide not to support Corbyn if he wins the leadership election and are de-selected and then they decide to stand for re-election then the Labour Party will lose MPs (just like in 1983).

    I recall our spokesperson during the coalition talking about changing our economy to include more industrial production. This article by Edwin Moriarty clearly points out how backward looking this was.

    I would love to think that we will “reach out to those people being left behind” with a new radical liberal approach to the economy. However I think this is highly unlikely as the policy seems to be to chase votes from the 48% who voted Remain, which I think will stop us being in a strong position to win around 50 MPs in 2025.

    If Edwin Moriarty is correct and most industrial production will be no longer be done by humans then we need a radical change to our tax and benefit system. This radical change will need to include taxing automated production (and maybe include a tariff on production from foreign countries to provide a level playing field for these industries) and providing a Citizens Income for everyone. And I can’t see the party agreeing to even a partial Citizens Income at Federal Conference in September. This radical change could include a better and an improved scheme for regional support for business to start up and stay in areas where they are needed, and maybe a tax on companies starting up in London and the south-east of England. This radical change could include a nationalised national bank to invest only in businesses.

  • Lorenzo Cherin 22nd Jul '16 - 7:20pm

    Edwin

    You have a very good series of thoughts here worth consideration.
    These are policy areas we need to get involved with.

    In the city where I , and I believe , you ,have lived ,a number of years , Nottingham , the Labour party has realised the old industries have gone , it is blindingly obvious , they have ! And they have made the most of it at some level with input into new ventures.But there is one industry they are at times , nearly oblivious to , and it is not one that relies on call centres or technology or anything really modern at all , but is very traditional , and could yield many, many , more jobs .Tourism !

    In a city that is based on heritage , Labour have shown, on this very aspect , no particular interest and less imagination.The way it can be explored need not be cheesy or old fashioned, but exciting and popular.In Boston and the wider State of Massachusetts, in the USA, hundreds of actors and writers and directors are employed in the promotion of the history and legend of that area.Nottingham barely figures in such a way at all. One or two venues, employing hardly any creative people. They have not shown much interest in preserving and advancing their own regional and industrial heritage as something to explain , and share. Costume museum , closed. Lace museum, closed. The industrial museum itself and even Byrons Newstead Abbey , nearly ,but not quite , in moth balls for a time .And most of this before the recession and crash ,let alone the coalition! Yet they always seem to be able to raise the money for pet projects !

    I actually do hope Labour itself, nationally , is not going to become history. But Labours divisions and downright ludicrousness, now , are, becoming legendary !

    We as a party, I hope , and believe, have less of an archaic attitude ,but more respect for history, which is where it was New Labour, that lost its way.Cool Britannia was all well and good , but it soon cooled off ! I am developing a project for our party , and, eventually , policy , that is a radical departure ,and , within the arts , creative industries , culture , leisure ,and, yes, tourism , can indeed encourage the creation and retention of jobs. And the improvement of communities.

  • John Mitchell 22nd Jul '16 - 9:00pm

    I would lay more blame at Tony Blair, or at least Blair sowed the seeds for the current predicament. People don’t believe what politicians say anymore and greater numbers of the electorate are enthused or energised by someone in Jeremy Corbyn who is seeking who is talking about things people care about, but importantly he is doing it with conviction. Or in other words, it’s not a lie or a ruse, Corbyn has principles.

    I agree with your central point though and industry has changed. My own outlook is not quite as pessimistic, but industry needs to be modernised with new technology and skills in admittedly different fields.

    Labour’s current internal problems are their own doing. As a democrat, I don’t agree with the rebels’ decision to try and outmaneuver their current leader who was not responsible for the EU exit alone and has a huge mandate with members. Speaking of the EU referendum campaign, Alan Johnson was head of the Labour ‘in’ campaign but that has long since been forgotten.

  • The last 100 years or so of the history of agriculture provide a guide to the changes now sweeping manufacturing.

    100+ years ago agriculture was a huge employer; new technologies (tractors etc.) have reduced it to a tiny one today but agricultural production is far, far higher. Part of that is statistical; in 1900 the primary farm power-source – carthorses – was raised and maintained on the farm and so formed part of agricultural employment and other statistics. Tractors are manufactured off the farm and part of their maintenance is off the farm and is reported as ‘industry’ or ‘services’ by the statisticians. So if governments think they can afford to ignore farming because the statistics appear to show it’s a tiny employer (they are obsessed with employment data) they make a huge mistake – agriculture sits at the top of a huge supply chain. And we still need to eat.

    Similarly in manufacturing many functions that were formerly done in-house are contracted out so the statistics massively understate it’s overall importance.

    So, we should expect – and even welcome – that industry is getting more efficient in terms of directly employed labour because that’s how we, as a nation, get richer. But we should not forget that many others from solicitors and accountants to graphic designers, builders and utilities depend for part of their income on services provided to manufacturing. We also need a healthy manufacturing sector because we can’t go on running a huge manufacturing deficit for ever without eventually getting poorer as our overseas debts mount up.

    The disturbing thing about UK manufacturing is that production is falling AFAIK. In every other significant country (again AFAIK) it’s rising even as employment falls. Something has gone badly wrong in the UK.

    Foreign companies like Nissan and many others manage to run plants in this country wthat are world class for competitiveness so it’s not a problem with British managers or workers (despite their starring role in Tory demonology). The problem looks to be centred on British ownership. It should be no surprise that Tories are blind to that!

  • Gordon Lishman 23rd Jul '16 - 11:18am

    I agree with Edwin about the Labour Party and very much with Gordon (which one?) about the Party’s policy process. However, I want to cast some doubt on the tendency to make generalised comments about “the crippling of their communities, and the industrial centre that were once at their heart”. Yes they exist and they offer a challenge, but please don’t lump everywhere in the North into that category. Sunderland, Burnley and Preston have thriving industrial bases and they were still two-thirds “leave”. Brexit may well harm these towns, particularly with the aerospace dependency of East Lancashire from Preston to Barnoldswick, but that’s in the future and it didn’t prevent people from voting to leave the EU. The North of England is not all a grim, grimy desert of closed collieries, mills and warehouses and many people have a disposable income higher than trendy London where mortgages and commuting costs eat up a much larger proportion of total income. That’s why a competent industrial strategy (not 1960s trying to “pick winners”) can make a big difference.

  • People have been talking about massive unemployment being created by machines and technology for over 200 years yet more people are employed than ever before. As long as people have money to spend and need or want services then someone has to provide those services but if you give people a citizens income then many people will not want to work so who will actually provide the services ? We have that problem already where employers cannot find staff because some people do not want to work as they live on welfare benefits so we have to rely on immigration which then upsets the local population. How do you solve this ?

  • In my first comment on this thread I said there are many strands to the problem Edwin raises so let me pull at one of those to show the sort of change that’s necessary.

    Investment always flows towards profitable opportunities but the UK’s cost base is too high relative to foreign competitors so it mostly doesn’t flow here and that in turn means we are short of high quality jobs. Government incentives may help at the margin but doesn’t and can’t fundamentally change this.

    If this rings a bell it should. In essence it’s the same issue faced by campaigners like Cobden in the 1830s and 1840s. Aristocratic Tories had used their political power to enact Corn Laws that levied tariffs on corn imports thereby keeping UK prices higher than if imports were possible. That raised farm income above what a ‘free market’ (i.e. free of tariffs) would have delivered; in turn that meant landowners got higher rents on their estates. Since bread was then a big part of the cost of living this was ultimately at the expense of the rising industrial sector who had to pay their workers more than they would have with a free market.

    So Cobden and others organised the Anti-Corn Law League to campaign for free trade in corn and, as history records, they were ultimately successful and that became one of the roots of the Liberal Party.

    Today agriculture doesn’t dominate commerce as it did back then but the economy is vastly more complicated and abounds with opportunities to extract excess ‘rent’ just as those early Victorian Tories did. It’s done in all sorts of ways, for example by oligopolies like ‘Big Retail’ which has mark-ups far above traditional ones, in banking where interest on house mortgages (directly or via buy-to-let) is far above traditional levels and in intellectual property that has far outgrown its legitimate use.

    These excess rents add enormously to the cost of living and therefore to industry’s cost base. Many years ago I estimated that for Big Retail it was at least a third of the selling price; Aldi and Lidl suggest that I was about right. Overall, costs that aren’t necessary could easily add to a similar figure.

    Get rid of excess rents and industry will thrive; leave them and it will continue to be crushed.

  • Conor McGovern 23rd Jul '16 - 9:54pm

    Gordon, the question is if industry thrives, will people necessarily?

  • Conor McGovern – Not necessarily. That’s down to how the profits are allocated between profits on the one hand and wages/salaries on the other. However, if industry doesn’t thrive then there are few profits to share.

    The “strong” economy the government likes to boast about is “strong” only because there is lots of newly raised debt being spent. When our national credit card finally maxes out we are in deep trouble.

  • Gordon – “It’s done in all sorts of ways, for example by oligopolies like ‘Big Retail’ which has mark-ups far above traditional ones, in banking where interest on house mortgages (directly or via buy-to-let) is far above traditional levels and in intellectual property that has far outgrown its legitimate use.”

    “Big Retail” barely turns a profit these days. BHS just went bust and the media often mentions M&S’s latest attempt to reinvent itself and become profitable again. The elephant in the room is Amazon, which chooses to operate on exceedingly slim margins and barely cares about profit. It concentrates on volume instead.

    I’m surprised by your comment about interest on mortgages. If you have a deposit (admittedly a big if) and a decent credit score, you can get rates right now that a very low by normal standards.

    Rent is of course a classic “supply and demand” thing. The rents for prime sites in prosperous town centres are huge. The rents for large warehouses for Amazon fulfilment centres in South Wales or wherever are very low (or virtually free if you include grants).

  • Nick Baird – The point about retail is that ‘Big Retail’ enjoys much greater margins than it would have several decades ago or then ‘small retail’ now has. So, surviving small shops are, by one very important measure, often more efficient than their larger competitors despite the lack of economies of scale. Amazon has indeed shaken things up but the trend towards fatter gross margins for big retails predates it.

    From the public’s POV things cost more but retailer’s fatter gross margins doesn’t guarantee success – costs tend to increase to absorb the profit and that’s what has happened. And then the worst managed firms like the two you name struggle.

  • Yellow Submarine 25th Jul '16 - 7:26pm

    It’s a fantastic piece simply because it speaks to Truth to Power. People may well have have voted Leave because of deindustrialization. They were entitled to do so. But the jobs aren’t coming back. Ever. I fear we’re going to have a decade of pandering because of the referendum result after which the jobs still won’t have come back and those voters will be angrier than ever. Of course the article doesn’t offer any of the solutions it seeks but who else is at the moment. The fact it speaks a blindingly obvious truth to power is a triumphant start.

  • Hi Gordon. But the movement to free trade was a significant factor that contributed to British industrial decline (all other countries at that time had tariffs to protect their industries, especially new industries – synthetic dye was a classic case), together with Gladstonian Liberal economic policy which involved tax cuts, spending cuts, and minimal state intervention, which distorted British electrical development during 1880-1914 (too many small power stations with different standards, sue to lack of state intervention). These weaknesses were actually caused by classical liberal policies.

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