James Max - James Max is a broadcaster, columnist and business expert

You can’t polish a turd… but you can roll it in glitter

We all know the economy is in a mess.
However you look at it, 0.2% growth in GDP for the second quarter of 2011 is fairly lame. It’s easy to point the finger at George Osborne and say that he’s not doing enough to kick-start the economy and bring it back to life.

Whilst the budget cutting is fine (if a bit slow) it’s the future vision that’s lacking. Similarly you can furrow your brow at Ed Balls and his comments in full knowledge that he and his then boss, Gordon Brown spent too much, made terrible judgments over the sale of assets, raided pension funds, overcomplicated the tax system and worst of all came up with the phrase “no more boom and bust”. As for Vince Cable? The men in white coats will be along shortly.

Fact is, we are where we are. Of course some of the mess is resultant from the political mistakes made over many generations. By politicians of all colours, I might add. Like most of our problems the solutions they tend to enact deal with the symptoms and don’t tackle the causes. Time and time again we hear that wretched phrase “learn the lessons”. Yet no one has learnt any lessons. Politicians on all sides of the House are making the same old mistakes all over again.

The causes for our economic malaise lie in a number of factors. Starting with the educational system. Whilst in places it is excellent it also has massive failings. We have a mixed economy and that means we need a mixed workforce. With a range of skills. We aren’t turning out enough students with the right skills and motivation for the jobs on offer. Similarly we are stifling excellence whilst demonstrating wilful blindness. Wilful blindness to the terrible lack discipline of many students. Wilful blindness to the reality that a significant minority of school leavers have few if any real or tangible skills. And wilful blindness that a mixed ability “comprehensive” system that doesn’t strive for competition and excellence has failed.

Our economy does best when it innovates. Since the industrial revolution, this little island of ours has punched well above its weight. Yet as times change we need to stop looking back and look forward. Yes, perhaps we should manufacture more. Perhaps we should have apprenticeships. Perhaps we should reform the benefits system. Yet that is to avoid the cause of the problem. Start with a high quality education system and the first building block of our future will be in place.

Our economy is in a poor state because we are not innovating our way out of the crisis. By all means go and create some new way of generating power if that’s what you want to do. In my mind that isn’t where we as a nation can really add value. It’s a sideshow and a fairly poor one at that. Sustainability and “green” policies are perhaps one small element of our future. But it shouldn’t and cannot be the thrust of a bold new Britain.

So. Where’s the glitter? We need a plan. That plan needs to look at what we are good at, where the problems lie in delivery and how we can position ourselves for a global market. If you look at the economy we are first class at financial services. I know many think we should tax these people more, that they created the global downturn but that is to forget that the financial collapse was the symptom and not the cause. We have innovated like no other nation in this area. We need to build on our successes and fight hard to keep investment banks and hedge funds on our shores. By all means regulate but with care and caution. Light touch regulation was a phrase that was used. It didn’t deliver. Because light touch ended up being no touch. That’s just stupid. However, regulation should not mean red tape. Or higher taxation. Regulation should mean ethics, innovation and ease of operation.

But let’s not stop there. We can add value in virtually every professional service and this goes right back to education. High quality education is the key. It’s also the key to research and development. In pharmaceuticals and health. We are a world leader and have every opportunity to grab a greater market share. Yet if we don’t pioneer, we won’t succeed. Of course we have even more opportunity to innovate. Our media is some of the finest in the world. From the people who create formats to those who actually make the TV shows and films. Music and entertainment is a massive business yet somehow we treat those who wish to go into the creative sector as a bit odd or self motivated egotists. Now is the time to think again about what we want this country to be. We need to think positively about our future. It’s not about pumping money into the system to make us feel better. And we shouldn’t. This malaise isn’t actually about money. It’s about attitude, focus and direction. This is about finding our place in a very different world. A world in which added value creates profits. Where expertise and innovation are rewarded. Products and services that gain a global audience demand excellence and require ingenuity.

What can the government do? If they don’t have the money to do things themselves (which they don’t) then they have to make it easier for companies and individuals to invest. This means removing red tape. Barriers to entry must be stripped away. Trade and setting up business needs to be easier and less fraught with regulatory bureaucracy. Taxation should be there to reap the rewards of profit and not to punish those who dare to do well. The free market will deliver, if it is allowed to. Many have become fixated that the state can provide. It cannot and should not. It can, however, facilitate. We will never have the power and might of a global superpower again. Perhaps that’s something we need to remember the next time we put an order in for some nuclear weapons or some tanks. What we can do is be nimble. Plucky. Innovative and inventive.

So let’s get to it, people of Britain. Go out. Take your glitter. And start rolling!



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