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It isn't (the indicator for this is that Reeves is saying exactly the same thing). It is hard to be brief but: * Financial services - totally fucked, most of

It isn't (the indicator for this is that Reeves is saying exactly the same thing). It is hard to be brief but: * Financial services - totally fucked, most of the VC funding in the UK comes from overseas investors because pension and insurance rules (that were largely adopted from Europe) mean that they have to own large amounts of govt bonds...the recent problems indicate how wise that was. Everything isn't working: retail, savings, banks, it is all not working. * Planning - obviously...lots of countries have versions of this problem but it is becoming very problematic. Iirc, there was a recent infrastructure project that had to do a new environmental assessment (costing tens of millions) for every km of work they did...it isn't just housing, it is everything, it is all fucked. * Healthcare - obviously...not going to say anything more but it is at the point where it is impacting the economy. * Labour - again...do I need to say more? Look at what is happening right now. * Education - again...do I need to say more? We have massive issues producing people with skills that employers require. There are other issues around this that relate to poor management and immigration, but schools are just bad (this is mentioned in the article to be fair but only from the perspective of too many politicians being from Eton...why can't they just...find people from journalism, who work at...the Economist say?). * Housing - separate from just planning, there are specific rules within the housing market that cause distortions above the planning system failing to produce enough supply. For example, rent controls in Scotland...that caused a 40% drop in rental supply in two weeks, this is economic mismanagement on a grand scale. * Local govt - needs fundamental reforms in multiple areas. Social care, planning, a lot of the new environmental rules are very dangerous (if people from outside the UK can believe it, some local councils are introducing rules which mean you will be fined if you exit your neighbourhood in a car to go to another part of the same city). * Transport - almost everything isn't working properly. Road, rail, it is all gone. Almost all due to problems in other areas above but which will now require structural changes. Btw, I don't know what planet you have to live on not to notice this stuff. I am in my mid-30s, every single job I have had things that impacted my ability to produce more output because of govt intervention. Every one. Once you see this stuff, you realise how bad it has become, every level of govt, every institution, it is everywhere.

paganel 4y ago
I'm not from the UK, but from a distance (the other side of Europe) it looks like UK's ongoing economic implosion seems to also have been caused by the people over there going all in on "the service industry!" sometime in the late '80s - the '90s, and leaving aside almost anything that involved making physical things, from roads to steel to stuff like that. Imo that might work for a very small country or for a city-state (like Hong Kong or Singapore, even though these also used to make actual stuff), but I don't think you can base the economy of a country as big and developed as the UK is entirely on services. At most you get a pseudo-city-state, which is what London looks like, surrounded by economic "blob". It's not London that built modern UK, but the likes of Manchester, Birmingham, Glasgow and, yes, Newcastle and the North-East of England. All those cities might as well not exist now, from an economic pov. Of course, I might be totally wrong on this as I don't live in the UK, but I've got most of that by reading David Edgerton's The Rise and Fall of the British Nation: A Twentieth-Century History [1] recently. (a Economist editorial from a couple of weeks ago was also quoting David Edgerton, if it matters) [1] https://www.amazon.com/Rise-Fall-British-Nation-Twentieth-Century/dp/0141975970 https://www.amazon.com/Rise-Fall-British-Nation-Twentieth-Ce...
- skippyboxedhero 4y ago
  Yes, I think this is true. But it wasn't an active choice. By the early 1980s, most forms of manufacturing had become uneconomic because of union activity. And, amazingly, this is still the case (there is a refinery near me, was bought by Ineos, they had a multi-decade package of investment based on an agreement with the union not to strike, deal closed...union went on strike almost immediately, Ineos never put another pound in, invested heavily in Europe where unions are more co-operative, they are now beginning to shut down the refinery...it is that simple). The only exception to the places you have listed is Manchester: towards the south of the city, they have built up a really competitive ecomm hub (with the airport, with the port, and with the support of local govt to build warehouses)...inflation has totally destroyed this industry (China subsidizes international shipping, most of these companies fulfilled orders for Europe/US out of the UK...the rise in air freight finished them). Glasgow is largely retail/govt-based, the North-East is seeing very promising investment in the free port but is very troubled, Birmingham muddles through. The problem with things like manufacturing is that it overlays several areas that are problematic for the UK: planning, infrastructure, labour, labour mobility, energy...none of this stuff works anymore. For example, not many people know that one of the first modern CPU was made in Scotland (this was when Intel were making a similar chip for the first calculator in the early 70s)...but the industry just died in the 80s. Again, people will talk a lot about deindustrialization but far less about why this happened. In the 60/70s, the govt invested heavily in local production, almost all of these companies failed or were sold to foreign buyers who could manage them properly (Rolls-Royce is the only exception I believe). There was no active choice, all other options were just removed by repeated failure.

paganel 4y ago

I'm not from the UK, but from a distance (the other side of Europe) it looks like UK's ongoing economic implosion seems to also have been caused by the people over there going all in on "the service industry!" sometime in the late '80s - the '90s, and leaving aside almost anything that involved making physical things, from roads to steel to stuff like that. Imo that might work for a very small country or for a city-state (like Hong Kong or Singapore, even though these also used to make actual stuff), but I don't think you can base the economy of a country as big and developed as the UK is entirely on services. At most you get a pseudo-city-state, which is what London looks like, surrounded by economic "blob". It's not London that built modern UK, but the likes of Manchester, Birmingham, Glasgow and, yes, Newcastle and the North-East of England. All those cities might as well not exist now, from an economic pov. Of course, I might be totally wrong on this as I don't live in the UK, but I've got most of that by reading David Edgerton's The Rise and Fall of the British Nation: A Twentieth-Century History [1] recently. (a Economist editorial from a couple of weeks ago was also quoting David Edgerton, if it matters) [1] https://www.amazon.com/Rise-Fall-British-Nation-Twentieth-Century/dp/0141975970 https://www.amazon.com/Rise-Fall-British-Nation-Twentieth-Ce...

skippyboxedhero 4y ago
Yes, I think this is true. But it wasn't an active choice. By the early 1980s, most forms of manufacturing had become uneconomic because of union activity. And, amazingly, this is still the case (there is a refinery near me, was bought by Ineos, they had a multi-decade package of investment based on an agreement with the union not to strike, deal closed...union went on strike almost immediately, Ineos never put another pound in, invested heavily in Europe where unions are more co-operative, they are now beginning to shut down the refinery...it is that simple). The only exception to the places you have listed is Manchester: towards the south of the city, they have built up a really competitive ecomm hub (with the airport, with the port, and with the support of local govt to build warehouses)...inflation has totally destroyed this industry (China subsidizes international shipping, most of these companies fulfilled orders for Europe/US out of the UK...the rise in air freight finished them). Glasgow is largely retail/govt-based, the North-East is seeing very promising investment in the free port but is very troubled, Birmingham muddles through. The problem with things like manufacturing is that it overlays several areas that are problematic for the UK: planning, infrastructure, labour, labour mobility, energy...none of this stuff works anymore. For example, not many people know that one of the first modern CPU was made in Scotland (this was when Intel were making a similar chip for the first calculator in the early 70s)...but the industry just died in the 80s. Again, people will talk a lot about deindustrialization but far less about why this happened. In the 60/70s, the govt invested heavily in local production, almost all of these companies failed or were sold to foreign buyers who could manage them properly (Rolls-Royce is the only exception I believe). There was no active choice, all other options were just removed by repeated failure.