Britain"s economy and the German model
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Britain"s economy and the German model
Panda Tue 3 Jan - 10:27
Britain's economy and the German model
We can endlessly rehearse the causes of industrial decline in Britain blaming the investors, the workforce and the entrepreneurs, but mostly it is near-sighted politicians and, ironically, those who believe intractably in free-market capitalism who have destroyed industry. If we don't make goods we lose our markets. However, we are where we are, with a world-class financial services industry making money without investing in British manufacturing, a square mile protected by a prime ministerial veto in Europe, which is not helping British industry. Demand is seen as the key to relieving recession, but if it isn't proportionately for goods made in Britain (I'm no protectionist) we will lose our mixed economy which is key to long-term prosperity.
Dr Graham Ullathorne
Chesterfield, Derbyshire
• Like China, the reality of the German manufacturing export bonanza is an artificially low exchange rate. The euro exchange rate may be crippling Greece, Spain, Portugal, Italy and Ireland, but if Germany still had the old Deutschmark it would be trading maybe 30% higher, and Germany would be laying off workers, not recruiting them. Germany and China have trade surpluses, which cause major problems for the many countries who have trade deficits. A solution suggested by JM Keynes was that surpluses must be spent and after a set period of time would no longer have any value. This, and Keynes's other sensible suggestions, are rejected out of hand by the current bunch of neoliberal anti-democratic governments that favour austerity, which can only lead to disaster.
Such an idiotic currency union was always designed to have only one winner, Germany, for whom it is Christmas 365 days a year. But, when the sticking plaster runs out and the inevitable collapse of the euro follows, Germany will be exposed and without a friend.
Michael Gold
London
• Jonathan Glancey could not be more right. The UK's over-reliance on international financial services, home ownership and retail to drive the economy has proved short-sighted economically, socially and spiritually. Key questions now are, first, whether greater recognition that the country needs to refocus its energies on manufacturing will get adequate government support (the jury is out); and second, the kind of manufacturing we develop. EU environment commissioner Janez Potocnik recently warned that resource use must become a mainstream issue in economics. Accordingly, new UK manufacturing initiatives must help transform our currently profligate consumption of finite resources.
Miles Litvinoff
London
• Have we learned any lessons from the two world wars that we won? If we had actually lost, as the Germans did in 1919 and 1945, and faced bankruptcy and complete destruction of our industry maybe our politicians and industrialists would have learned lessons so that now we would be economically stable.
How can any politician claim that Britain is independent when, for example, virtually all our electrical power is foreign owned? Labour and Conservative parties have for decades talked about "innovation" and "white heat technology" but they have never actually invested in British assets, preferring to sell them to make short-term gains.
John Laird
Harrogate, North Yorkshire
• Could it be that Britain's economy is built on flimsy and unreliable foundations simply because our society is? We are governed by a ruling elite redolent of the 19th century who have distrusted the emergence of all state institutions with the remit to protect the ordinary citizen. They are engaged in the task of removing any impediments to their own self-interest. They are sustained in the fictional task of "doing their best for the country" by the clever use of PR tactics and the collusion of a supine media. They behave as if breaking promises and telling lies can be justified so long as they can be re-packaged as necessities. Unless their deceit is regularly exposed and challenged, we can only expect that our society will fragment further, our culture will continue to decline and the wealth gap inexorably widen.
Jeanne Pollak
- guardian.co.uk, Monday 2 January 2012 21.00 GMT
- Article history
We can endlessly rehearse the causes of industrial decline in Britain blaming the investors, the workforce and the entrepreneurs, but mostly it is near-sighted politicians and, ironically, those who believe intractably in free-market capitalism who have destroyed industry. If we don't make goods we lose our markets. However, we are where we are, with a world-class financial services industry making money without investing in British manufacturing, a square mile protected by a prime ministerial veto in Europe, which is not helping British industry. Demand is seen as the key to relieving recession, but if it isn't proportionately for goods made in Britain (I'm no protectionist) we will lose our mixed economy which is key to long-term prosperity.
Dr Graham Ullathorne
Chesterfield, Derbyshire
• Like China, the reality of the German manufacturing export bonanza is an artificially low exchange rate. The euro exchange rate may be crippling Greece, Spain, Portugal, Italy and Ireland, but if Germany still had the old Deutschmark it would be trading maybe 30% higher, and Germany would be laying off workers, not recruiting them. Germany and China have trade surpluses, which cause major problems for the many countries who have trade deficits. A solution suggested by JM Keynes was that surpluses must be spent and after a set period of time would no longer have any value. This, and Keynes's other sensible suggestions, are rejected out of hand by the current bunch of neoliberal anti-democratic governments that favour austerity, which can only lead to disaster.
Such an idiotic currency union was always designed to have only one winner, Germany, for whom it is Christmas 365 days a year. But, when the sticking plaster runs out and the inevitable collapse of the euro follows, Germany will be exposed and without a friend.
Michael Gold
London
• Jonathan Glancey could not be more right. The UK's over-reliance on international financial services, home ownership and retail to drive the economy has proved short-sighted economically, socially and spiritually. Key questions now are, first, whether greater recognition that the country needs to refocus its energies on manufacturing will get adequate government support (the jury is out); and second, the kind of manufacturing we develop. EU environment commissioner Janez Potocnik recently warned that resource use must become a mainstream issue in economics. Accordingly, new UK manufacturing initiatives must help transform our currently profligate consumption of finite resources.
Miles Litvinoff
London
• Have we learned any lessons from the two world wars that we won? If we had actually lost, as the Germans did in 1919 and 1945, and faced bankruptcy and complete destruction of our industry maybe our politicians and industrialists would have learned lessons so that now we would be economically stable.
How can any politician claim that Britain is independent when, for example, virtually all our electrical power is foreign owned? Labour and Conservative parties have for decades talked about "innovation" and "white heat technology" but they have never actually invested in British assets, preferring to sell them to make short-term gains.
John Laird
Harrogate, North Yorkshire
• Could it be that Britain's economy is built on flimsy and unreliable foundations simply because our society is? We are governed by a ruling elite redolent of the 19th century who have distrusted the emergence of all state institutions with the remit to protect the ordinary citizen. They are engaged in the task of removing any impediments to their own self-interest. They are sustained in the fictional task of "doing their best for the country" by the clever use of PR tactics and the collusion of a supine media. They behave as if breaking promises and telling lies can be justified so long as they can be re-packaged as necessities. Unless their deceit is regularly exposed and challenged, we can only expect that our society will fragment further, our culture will continue to decline and the wealth gap inexorably widen.
Jeanne Pollak
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