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.

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

Keeping the zombie economy on its feet

On 23 January the British government introduced its long-flagged industrial strategy. It was another in a long line of disappointing launches of industrial policies. I wrote an article explaining that Theresa May’s ‘modern’ industrial strategy isn’t nearly enough to boost productivity. Moreover, government economic policies that have primarily propped on the zombie economy are making matters worse. The article is here

What my new book is about

Creative destruction: How to start an economic renaissance

To be published on 29 March 2017 by Policy Press

The mature economies have been stuck in a long, contained depression since the 1970s. The pressing question that arises today is not why investment and productivity have been so weak, important though that is. Rather it is whether we are hitting the limits of effectively muddling through this dismal reality. The financial crash of 2008 was the first significant indicator that sustaining reasonable living standards could no longer rely on an ever-expanding financialised debt economy. The subsequent recession was one of the sharpest since the 1930s but thankfully the system’s collapse was avoided. Can we expect to be as fortunate when today’s bubbles burst? Continue reading