Sir Vince Cable has joined the advisory board of the newly founded Institute for Prosperity.
The Institute’s press release states:
A cross-party group of political heavyweights have joined forces to campaign for a new, manufacturing-led economic agenda that supports left-behind regions across the UK.
Described as a team ‘that will turn the dial on how best to deliver economic growth and put manufacturing centre-stage’, the group is made up of current and former politicians, ministers and economists who will sit on the newly-formed Advisory Board of the Institute for Prosperity.
The nine-person Board, whose members span the aisle, will include former Labour Minister Rt. Hon Caroline Flint, former Lib Dem leader Sir Vince Cable, and Conservative MP John Penrose.
The Institute for Prosperity was founded by businessman and economist John Mills earlier this year and is focussing on new and different ways for which Britain can increase levels growth and prosperity through changes in economic policy.
Principally, the group supports a ‘manufacturing revival’ from less than 10% of the economy to 15%, which it says will best support left-behind communities that have been adversely impacted by deindustrialisation over the last 40 years.
The appointment of the Board by Mills, which met virtually on Thursday (12 Nov), comes as the group steps up its call for a shake-up of economic policy as a way to secure much higher economic growth rates of over 3% per year.
The Board members were each invited for their economic and political expertise. As welI as current elected politicians from the government and opposition benches, the Board includes economist and Labour Peer Stephen Pollock. Members of the Board will collaborate on research, help build cross-party consensus, promote policies for growth, and campaigning for a more balanced economy.
Vince told Liberal Democrat Voice:
One of the truly epic tasks ahead of us is getting back to sustainable economic development after the damage wrought by the financial crisis and Covid (and potentially Brexit). I am interested in working with groups who have a positive approach to this question including the Institute for Prosperity with its focus on manufacturing recovery, an issue I was immersed in during the Coalition’s industrial strategy.
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15 Comments
“Principally, the group supports a ‘manufacturing revival’ from less than 10% of the economy to 15%….”
Before there is any real prospect of reviving manufacturing there does need to be an understanding of why it declined to less than 10% in the first place. Then there does need to some understanding of what type of manufacturing would be appropriate for the UK economy. There’s no point trying to complete with Bangladesh or Vietnam in the manufacture of cheap clothing and footwear. Or with China in the making of mobile phones.
Many parts of the UK, including Twickenham, are relatively prosperous without the presence of any significant manufacturing industry. How does that happen? Vince Cable should be in a better position than most to answer that. So maybe we need to expand a successful post industrial model to all of the UK instead of trying to turn back the clock?
There and again, they never had any shipbuilding in Twickenham.
Is that the same John Mills as was one of the main funders of the Leave campaign (and former Labour councillor)? In that case, good luck getting this group to see the elephant in the room when it comes to impediments to UK manufacturing going forward
Might a competitive manufacturing economy need to minimise the costs of living, the costs of doing business and raise the status of skilled manufacturing?
Might the aversion of the finance industry to real world productive investment and public welfare need to by reduced/remedied by the use of banking and credit creation as a public utility?
The obvious thing is that if we are not making the consumer goods ourselves in the UK we should be producing the machinery on which these goods are manufactured overseas. However I should imagine that high quality engineering firms in towns like Burnley and Huddersfield are doing this already. Also as a local example textile cloth manufacturing no longer requires large number of employees. Green energy production would appear to be our speciality going forward given the quality of our universities for research and development.
@Steve Trevethan
Historically banking has mainly done what little manufacturing has asked for in the UK. British manufacturers generally not been keen on investing in the latest capital goods or the latest training, as Michael Dintenfass explain the Decline of Industrial Britain.
British industrialists have mainly wanted to become more like aristocrats (and professionals), and often educated their progeny accordingly; their sons better versed in Latin and Greek than engineering or indeed economics and administration.
This extended to much of the education system. In 1902 Germany produced 6 times as many engineering students as the UK had engineering graduates with firsts and 2:1s. Of Britain Steel masters in 1935-1947, a mere 16% had some form of scientific training from a university, technical college or military academy, up from 9% in 1905-1925. By the 1980s, only 25% of British senior managers had a university degree compared to 85% of their German and Japanese counterparts.
Also nationalising banking just creates the problem of the state monopolising credit access, politicising it and a possible vector for corruption and patronage (like public sector outsourcing).
Tnanks to W F for his comment!
It provides excellent information on the need to be aware of the power of status seeking, the need for a greater awareness of this ever present “driver”, and the benefits of managing it for society.
Might we have harmful forms of corruption and patronage with our current form of banking as the 2008 banking crisis demonstrates ?
Might society better off with a national “high street plus” banking system to compete with the current banks plus effective regulation in the national interest?
Alex B ‘they never had any shipbuilding in Twickenham.’
Slight problem of access because of all those bridges downstream in London, locks and, below Teddington, tides. There are boatbuilders in Richmond and Twickenham though.
Vince has undoubtedly useful knowledge and experience to bring to this job; as to whether this body comes with useful proposals and gets them implemented, we will see.
England has structural problems with insufficient esteem for engineering, management and sustaining enterprises that use these skills.
” good luck getting this group to see the elephant in the room when it comes to impediments to UK manufacturing going forward.”
Presumably this is Brexit? Whatever impediments there might be have been allowed to develop in the decades we’ve been members of the EU.
There has always been a logical contradiction within the Brexit debate which that more progressive and left-wing Remainers, those who share a commitment to ending Tory austerity, should really be forced to confront. This that the European Union is a fundamentally pro-austerity institution. Austerity means that demand for goods and services is suppressed which in turn means that EU manufacturers are desperate to find less depressed markets. Naturally they’ve turned to the UK. Looked at the other way the EU is not a good market for UK exports. We have a huge deficit with the EU but a moderate surplus with the R.O.W.
It has led to the undermining of UK manufacturing industry and has created the very conditions in the less affluent regions which led to a large majority for Leave.
@ William Francis,
I’ve heard it said for as long as I remember that Engineering in the UK wasn’t highly regarded. Finance was where the real money was made in the UK whereas us engineers were destined for a life of hardship. Etc etc. As a student I would often hear these sentiments from guest speakers who we would host from time to time.
Being somewhat mischevious in my attitude I would sometimes ask what was the best way of switching over to the banking and commerce. Were our qualifications going to be valued or did we need to retrain? That usually got a chuckle of approval from the audience and it did often leave the speaker floundering!
@Peter Martin.
You must have been a student fairly recently. Upon leaving Eton, Lord Carrington’s housemaster said to him, “For a really stupid boy, there are three possible professions: farming, soldiering and stockbroking.”
Finance wasn’t particularly lucrative as an occupation until the big bang in mid-to-late, when the City of Liquid lunches and old school tie networks, became the City of the Yuppie; sweatshop hours, high pay and cocaine.
@Steve Trevethan
Attempts to promote “challenger banks” after 2008 haven’t really worked out, the big 5 still are the big 5, so the public option of banking may work. Banking services are often provided through the post office in many countries, however, the Post Office was offering that very service in the years up to 2008.
Tougher anti-trust laws (which should be supported generally), making the existing market more contestable and tighter borrowing restrictions (chiefly on unsecured debt), should be a sufficient starting off point.
Thanks again to W. F!
An outstanding example of a public utility bank is the Bank of North Dakota, U. S. A.
https://en.wikipedia.org/wiki/Bank_of_North_Dakota
Perhaps the large scale introduction of something similar in the U. K. might bring the combined benefits of the disciplines and stimulations of competition?
Regulators only bring discipline.
(If we are lucky and have energetic and straightforward regulators!?)
“Banking on the People: Democratizing Money in the Digital Age” by Ellen Brown is well worth reading.
https://www.moralmarkets.org/book/banking-on-the-people/#:~:text=Banking%20on%20the%20People%20looks%20at%20how%20our,utility%20that%20serves%20the%20people%20and%20the%20economy.
https://www.bing.com/search?q=ellen+brown&form=ANNTH1&refig=3dcbee28e9314400a34c0f79a6e4fe7f&sp=1&qs=AS&pq=ellen+brown&sc=8-11&cvid=3dcbee28e9314400a34c0f79a6e4fe7f
The key sentence in Vince Cables comments is sustainable economic development some industries are already picking up on this through the circular economy ,some are already learning their is no such thing as waste just resources in the wrong place . already we are seeing innovation in aluminum smelting recycling and not importing raw materials , plastic being recovered and reused rather than ending up in landfill and water courses .
Bio-fuels now power Drax rather than fossil fuels . We could become the pioneers of this new and sustainable economic development .The politicians just need to catch up and enable these new industries to flourish .