We have nothing to fear but the fear of Brexit itself

British people are being told that there are two ways to approach Brexit, and they have to choose between them. An ideological way or a pragmatic way. Guided by formal principle or by practical necessity.

Catherine Barnard, professor of European Union law at Trinity College Cambridge, described the apparent options as follows: ‘You either have to prioritise sovereignty and domestic control, which has very significant economic costs; or you have to be more pragmatic and put a priority on your economic interests. A decision will have to be taken.’

So this is a stark choice, apparently, between sovereignty and economic livelihoods. The implication is that people shouldn’t be so stupid as to bring on economic deterioration resulting from a stubborn attachment to something as pretentious as wanting to ‘take back control’ over their nation and lives.

It is important that we cut through this presentation of Brexit. Read the full article here.

 

Sorry, Corbyn, but ‘anti-austerity’ is not enough

Another unexpected election result, this time brought about by Theresa May’s patronising, ill-considered and visionless campaign, invites traditional as well as new thinking. And when an election outcome is inconclusive, it becomes even easier to read into it your own established opinions. One interpretation, as suggested by Labour Party figures in particular, but also by some Tories, is that this was a vote ‘against austerity’. Of course, many people have in recent years been experiencing more sharply the material effects of our longest economic depression. But it is fanciful to assess the result as a positive vote against austerity.

Read the full article here.

May’s industrial strategy will fail unless it clears out zombie firms

My opinion piece for City A.M. arguing that in order to generate a new dynamic for economic growth, government has first to stop propping up the zombie economy. The application of many regulations, of government spending and procurement policies, changes to insolvency rules, easier monetary policies – all these and more have acted to support incumbent businesses. The full article is here.

Foster new sectors

I have submitted a Response to Questions 1 and 2 in the Green Paper Building our Industrial Strategy (Department of Business, Energy, and Industrial Strategy, January 2017). The submission can be read here.

This is part of a collective submission from the Institute of Ideas Economy Forum called ‘Go for Growth’, available here.

The truth about the Single Market

With Brexit negotiations about to get underway, one area that continues to get a lot of attention is Britain’s future trading relationship with the European Union. People still opposed to exiting emphasise the economic costs they fear from leaving the Single Market. Many fret that the two-year limit for Article 50 negotiations is too short a time to come up with a replacement trade deal. Moreover, if one is eventually agreed, possibly after some interim arrangement beyond the two years, they say it is bound to be a poor substitute for the advantages of full membership. Even many Brexit supporters seem to accept that more expensive and reduced levels of trade with the EU would be costly for the British economy, depicting this as a necessary, if unfortunate, expense of regaining sovereignty.

We should all be less negative about the economic consequences of changing Britain’s trading relationships.

The full article is here.

We need big, bold economic thinking in the Brexit era

It was predicted that UK chancellor Philip Hammond’s final spring Budget would be low-key and short on exciting announcements. Cautious and careful was the expectation. Leaving aside for a moment the row over tax increases for the self-employed, these expectations were broadly met. But that doesn’t mean the Budget was an insignificant event.

The Budget provided a revealing insight into the current state of politics.

The article is here.

The economicisation of a depoliticised public life

In my forthcoming book Creative destruction I describe the way that economic policy has been depoliticised since the 1980s. The fatalist perspective associated with Margaret Thatcher’s TINA – ‘there is no alternative’ – applied as much as anywhere to the workings of the market economy. The acceptance of TINA indicated the demise of left-right political contestation for changing and improving society through differently organised economic systems.

Politicians of all stripes embraced this TINA outlook and reduced the scope of economic policy to managing the economy. The primary goal was ensuring stability. Much of this management function was assigned to technocrats, including souped-up regulators, expert-led commissions and central bankers. This outsourcing by politicians of their economic responsibilities to unaccountable bodies and institutions reinforced the conservationist, status quo orientation of economic policy that has proved so damaging to economic performance. Pro-stability measures have tended to stunt the functioning of creative destruction and helped entrench our zombie economy. Continue reading