Agricultural luddites
Prime Minister Tony Blair added to the clamour of criticism of British supermarkets for holding down food prices - which he suggests is the reason for the foot and mouth outbreak. In fact it was increased productivity in agriculture that transformed the quality of life in the UK. In 1950 spending on food represented nearly 30 per cent of the household budget; by 1995 that was down to just over ten per cent. Increased consumer spending on leisure goods and IT is the consequence. Three years ago the Ministry of Agriculture Farms and Fisheries insisted that there was an excess capacity in abattoirs, and 'hopefully the smaller less efficient firms will be forced to close'. In today's backward-looking times, that advance is held to blame for the spread of diseased livestock. With meat prices temporarily rocketing, British shoppers will get a taste of what life would be like permanently, if the luddites got their way and agriculture was returned to its old labour- squandering techniques.
Too many laws, Jack
Our unlovely Home Secretary Jack Straw has outraged the legal profession once again by complaining that there are too many lawyers. Perhaps he should know. At any rate Straw certainly has not forgotten his barrister's training in how to exaggerate his case and mislead the jury.
Straw opined that lawyers were too busy 'cosying up to' their criminal clients, heedless of their wider duty to society and expressed his consternation that there would soon be more lawyers than police. The implication was that the legal profession was a massive vested interest determined to obstruct the 'fight against crime'.
There are indeed over 90,000 lawyers practising in England and Wales and there are about 125,000 police officers. Three decades ago there were three times as many police as lawyers. But the comparison is meaningless: as the Law Society was quick to point out of the 82,000 solicitors only 11,300 do criminal defence work. Not only do most lawyers have nothing to do with criminals or criminal law, but the figure rather puts in perspective the balance of resources devoted to infesting society with policemen, on the one hand, and to defending those accused of crimes by the gendarmes on the other. It seems that Straw believes this balance is not favourable enough to the police. (Hardly a vote of confidence!)
It is bad enough that the Home Secretary is so brazenly dishonest. But he reveals himself as the truly dim reactionary that he is when he complains that there are too many lawyers, as though it had nothing to do with him. If there are too many lawyers Jack, try getting rid of some of the laws, and, while you are about it, stop introducing sweeping new laws.
In the criminal law the obvious candidate for repeal is the drugs laws. If, on coming to power in 1997, Straw had repealed the Misuse of Drugs Act 1971, he would have reduced the number of recorded crimes in 1998 by 127,900 (J Corkery, Drug Seizure and Offender Statistics United Kingdom 1998, http://www.homeoffice.gov.uk/reds/drugs1.html). At a stroke he could have cut the business of every criminal defence lawyer in the country by at least one new client a month. (Not to mention allowing all those ordinary folk to get on with the job of boring themselves to death in peace.)
The Law Society's figures show that the real legal expansion is in the civil law. But then here too the government could have made a start and omitted some of the 130 new statutes it passed through parliament in its first three full years in power. If this Home Secretary is really concerned about the overall number of lawyers perhaps he shouldn't have introduced what may prove to be the most radical expansion in the volume and complexity of British law since Britain joined the EU. The Human Rights Act 1998 makes available a whole new cause of action against public authorities in the British courts, and widens the scope for the legal profession to influence the practice of government. As many critics have pointed out, it is nothing if not a lawyer's charter.
In a government of cheap populists none comes cheaper than Straw. His foolish remarks about the legal profession betray once again that this is a government that has no comprehension of the meaning of political leadership and of taking responsibility. It is always somebody else's fault. But then the real reason for the huge increase in lawyers' numbers over the past 30 years may be that we are increasingly forced to turn to legal representation for that which we know we can no longer achieve by political representation.
Parasite Britain
The Department of Trade and Industry's long-promised report Business Clusters in the UK was published this week. Government advisors have been dining out on anecdotal tales of 'business clusters' - geographically-based, virtuous circles of enterprise - for some time. Exotic stories abound of the motor sport industry in the South East, web designers in Clerkenwell and the growth of creative industries in derelict industrial districts. But now Trends Business Research have been asked by Lord Sainsbury tried to use the image of clustering as the basis for an objective analysis of the economy, with sobering results.
The 'clustering' concept is attractive to the current administration because it suggests mutually reinforcing growth locked in as much by collaboration as competition. Objectively, though, the advantage of the research is that it shows the inter-relations of British industries, whereby some create markets for others goods and services. The result is close to the eighteenth century economist Francois De Quesnay's 'Economic Table', that showed how all parts of the economy were mutually dependent.
The results of the enquiry dispose of many of the more fashionable myths about Britain's so-called 'New Economy'. First off, the motor sports cluster in the South East 'should not be exaggerated' accounting for around 1,600 employees (p83). And though some companies in Clerkenwell are making a living designing web pages, just 0.38 per cent of all retail sales are through the internet (UK Competitiveness Indicators, p45). As against the strategies adopted by Manchester and Glasgow for the promotion of their cities as cultural centres 'for most of the creative industries, any regional presence must be considered embryonic' (p58). While the DTI trumpets a 'new economy', the report notes that 'our most successful clusters deal in products that are hundreds of years old - financial services (banking and insurance) and the creative industries (publishing for example). Even the "newer" creative industries such as advertising are hardly newborn' (p54).
Most noteworthy, though, is the distribution of successful clusters and declining ones. In essence, the one virtuous circle is the City of London'an internationally successful cluster' 'concentrated in and around the City' (p45). In fact 465 000 Londoners work in financial services - a business which has 'been a major source of demand for software, data processing and telecom services' (Annex: London, p26). Amongst these are the 145 000 working in Computer/communication services, that have grown in number by a quarter since 1991. By contrast most of the business clusters in the North, such as those around the motor industry or the potteries are locked into a vicious circle of decline.
What the survey fails to do, though, is to consider the City of London itself as part of a larger division of labour, taking for granted the continued demand for its services. But recent research by the investment company Smithers and Co warns against such an assumption. David Murray and Andrew Smithers characterized the British economy as one great Hedge Fund, making money by selling intermediate financial services (Britain: The World's Largest Hedge Fund, Report No. 141 14th January, 2000). They point out that though manufacturing on the one hand and financial services combined have generally provided about half of all the value added by British firms, their respective positions have reversed, with finance taking up the slack as industry declines. Between 1989 and 1998, manufacturing fell from 24 per cent to 19.5 per cent of gross value added, while financial services grew from 18.5 to nearly 24 per cent in the same period.
Smithers and Murray explain the precariousness of the British economy:
'History shows that both banking and hedge funds are extremely risky businesses. They flourish during periods of rising markets, but are subject to bankruptcy when conditions reverse. Since 1980 world bond and equity markets have experienced one of the longest and strongest rises in history. The UK has been a major beneficiary of this. If the return on UK investments abroad were to fall into line with foreigners' investments in the UK and the profits on financial intermediation were to end, the UK's current account deficit would be around 5.5% of GDP.'
-- James Heartfield