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The big task that’s facing the next UK government…

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By St Etienne

Just a quick(ish!) note to highlight an important contribution from respected journalist & historian Max Hastings on just how big a task the next government will have in the UK. Food for thought, and locally is indicative why we need a strong showing not just for the Tory-UUP alliance at the next election but for the idea within conservatism generally that the tenure must be prepared to lead a wide-ranging rethink on British lifestyle and attitudes.

For those unwilling to register to view the article, a synopsis follows:

As if emerging from a shelter after an air raid, many people look around, behold an apparently un scarred landscape and say: “Was that the financial crisis, then? It wasn’t so bad.” Such a view seems to represent monumental self-delusion… It seems hard to overstate the pain in store when the next government embarks on the steps necessary to restore the public finances. Tony Blair and Gordon Brown have wrecked the economy.

While this may seem bog-standard politicking, Hastings expands to give an insightful analysis of just how big a task putting Britain back on the right track will be:

MPs are the only people jostling with Britain’s financial community at the bottom of the 2009 squash ladder for popular esteem. Like bankers, they have been revealed by the expenses scandal to possess lifestyle expectations exceeding anything justified by their performance. This matters, because those charged with running the country have forfeited the respect indispensable to reconcile voters to unwelcome economic measures.

The national mood approaching Christmas 2010 and 2011 is likely to be much bleaker than today’s. Most people will have significantly less money. If the Conservative party wins power, it will fail in its responsibility if it does not cull large numbers of state workers. More businesses will go bust.

We are cursed with a bloated sense of self-entitlement, reflected in the excesses of public spending. If we possess a capacity for private contentment that some Americans might envy, the reverse of the medal is a reflexive lassitude.

The sense of self-entitlement is I believe fast becoming the ignominious hallmark of the Blairite ‘revolution’ – I remember back in his halcyon days the grand speeches expounding how ‘we may not be the biggest, but we can be the best’. Somewhere along the way this got waylaid as the hordes of taxpayer funded self-interest groups began a systematic takeover of the buzzwords, focus groups and pr machines that were tasked with ensuring people were thinking the UK was getting better. The government for it’s part played willing accomplice as key individuals appeared more interested in likewise carving out for themselves grand ‘legacy projects’:

Service industries… will continue to generate substantial in­come, but scarcely sufficient to fund the Trident nuclear deterrent replacement and other symbols of big power status, to which both the Tories and Labour cherish pretensions.

Mr Blair professed himself eager to sustain the Thatcher legacy. In the event, however, the Labour government has proved much more skilful in extending expensive personal entitlements – what might be called the free bus pass culture – than in advancing productivity or generating real new wealth…  The party of Mr Blair and Mr Brown has never discovered how to get things done.

He makes an economic observation I have discussed before elsewhere. I believe it is prescient and that there is a dearth of consensus on the issue:

The best British manufacturers are world class, but such bosses as Sir John Rose of Rolls-Royce offer warnings about the shortcomings of the educational system in sustaining a workforce fit to compete with young Singaporeans.

There are fundamental uncertainties about how Britain will earn its living for the rest of the 21st century, especially as its earnings from financial services shrinks. Optimists talk up the value of intellectual property and the English language. But how many people can live off the likes of television’s Top Gear programme, the history books of Simon Schama and the novels of Hilary Mantel?

First off, I believe Britain’s future is in tertiary economic activity. We do not have the abundance of natural resources or the somewhat shadowy proxy access to them other states possess. Though finance is a perennially cyclic sector that while is important, as Hastings points out it is not something we can base our economy on going forward. Therefore fundamentally our economic future lies in innovation in design and technology. The importance of being at the bleeding edge (and staying there) in terms of research and exploitation cannot be understated in this regard.

Hastings goes on to outline a plethora of systemic & social problems preventing policies being created that might tackle the harsh realities. Whitehall, judicial & bureaucratic barriers are described. Perhaps the biggest barrier to change of all though is social mood, and what the he as an historian coins the ‘Bomb Problem’:

In the winter of 1939, Britain had been engaged with Germany for several months, but opinion surveys showed bewilderment about the usefulness of the struggle, matched by hopes that a deal might be struck with Hitler. Such illusions were dispelled only by the Luftwaffe’s deluge of explosives in 1940, which belatedly persuaded the nation of the malignity of the Nazis and obligation to fight them to a finish.

In peacetime, when no bombs fall, it is hard to generate a will for change, or reconcile people to even modest sacrifice. Mrs Thatcher profited from the industrial anarchy prevailing when she assumed office. The 1978-79 “winter of discontent” created a rare public acknowledgement that the country could not continue as it was.

Yet even against that background, many of her reforms were unpopular. Geoffrey Howe proved himself one of the century’s great chancellors by sustaining a rigorous fiscal regime amid dire opinion polls. It is doubtful that Mrs Thatcher would have been able to retain office through the 1980s without the help of an unelectable leftwing Labour party and the prestige conferred by the 1982 Falklands victory, irrelevant though this was to the national predicament.

I leave you with his conclusion on the task ahead for David Cameron:

Mr Cameron will have no hiding place. He must tell the British people that in 2009 their long weekend ended; that if the nation is to regain prosperity in the third decade of this century, during the second it must change its ways and pay awesome bills. On Mr Cameron’s watch, economic bombs will start exploding. To persuade the country that these are not his fault, but the result of past follies and delusions that are no longer affordable, will require the skills not merely of a good politician, but a great one.

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Filed under: Conservatives, finances, guest blogger

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