Hutton on Germany/England

Ian Murray seamus2001 at
Sat May 26 19:38:17 PDT 2001

Why the Germans are right about us

It hurts to be told that our public services are third-rate. We already knew that. So why are we so patient? Why don't we complain more?

Observer Election Special

Guardian Unlimited Politics

Will Hutton Sunday May 27, 2001 The Observer

Stern magazine last week devoted 12 pages to reporting on what the Germans now habitually call 'the English patient'. Its images of a country where its poor live in Third World conditions, a fifth of the adult population is illiterate, its public services are third rate, 25,000 people unnecessarily die annually from cancer and the environment is casually disregarded don't fit with our own idea of ourselves. The consensus was that it was over the top and one-sided - and we could do the same hatchet job on the Germans if we chose. But the truth has to be faced. There are areas of excellence, but by and large Britain doesn't cut it. Our public services are third-rate. And tellingly the same parsimony, shoddiness and acceptance of low standards infect the abysmal quality of much of what goes on in the private sector. The two are of a piece. The scale of the growing productivity gap with the rest of Europe is one indicator, but the deeper measure is the cultural stoicism with which we endure the second best, the hand-me-down and the botch. Try as we might, we can't hit back at the Germans in the same way. Their country has its malfunctions, but it works.

Our seaside hotels are one of the more telling barometers of our irredeemable second rateness - and which make the transport system seem almost utopian. My room in Hove last year during the Labour Party conference plumbed new depths; fraying and pockmarked carpet, torn, cheap curtains, a shower that rained water over the ceiling which then dripped onto the bathroom's stinking carpet, a rickety wardrobe without hangers, and walls so thin that you could hear every aspect of the other sufferers' nightly ablutions. Has the hotelier no shame that he presides over such an establishment? Why do we feel so much embarrassment about telling him to his face that his hotel is terrible?

Try a comparable three star hotel in a similar resort in Germany, and you enter a different world where investment, quality and service are all inbred - and there are the institutions and culture to support them. It would have borrowed from the local savings and mortgage banks established to support local business investment, and it would have ploughed the cash into the building - so there would be proper bedroom walls and working bathroom fittings, built by a workforce with the proper vocational skills trained by local, state-funded skill schools. And German hotel guests would have complained vociferously if standards fell below what they knew they should get.

And this is the rub. The speed with which the 'rip-off Britain' campaign took off should alert even the most complacent defender of the British private sector to its shortcomings. It doesn't invest enough. It seems structurally incapable of treating its workforce creatively and humanely, or demanding that they have high skills. It treats its customers with highhanded indifference - try finding someone who will go beyond the standard answer to any complaint at, say, Dixons or a Sky call centre. And those at the top seem only interested in rewarding themselves with stratospheric salaries.

Glance at the numbers. German workers have 70 per cent more capital invested at their elbow for every hour worked compared with their British counterparts. The combination of their high skills and high investment mean they produce 29 per cent more for every hour they work - allowing them to work 175 hours less every year. Over the 1990s employment grew in Germany by 0.3 per cent a year - in Britain 0.4 per cent year, despite our famed 'flexible labour market'. If Germany hadn't been consumed by the overwhelming cost of integrating the East, it would have generated just as many jobs as we did.

For 20 years we have been told that in order to improve our productivity we must shatter trade unions, emasculate the welfare state and offer the lowest marginal tax rates in order to incentivise workers and managers alike. The ratio of our chief executives' salaries to average production workers' pay is now twice that in Germany; our benefit levels are about half as generous; our tax rates uniformly lower. We are a much more unequal society, just as the Conservatives said we needed to be in order to grow more productive. But instead the productivity gap is widening, and the gulf between their public services and ours has become a chasm.

Where Germany scores is that it understands the importance of ensuring that the institutions - whether in training, science or banking - that support its economy and society should be of the highest quality and support the common interest. Article 14 of the German constitution openly declares that 'property imposes duties. Its use should also serve the public weal'. In Britain the notion that property rights are accompanied by duties to the public weal is so weak that a company like Railtrack thinks it is perfectly proper to pay dividends to its shareholders while requesting more public subsidy. And Railtrack's view is reproduced in spades across corporate Britain: business's first responsibility is to its shareholders.

Britain needs to take the same care over the structure and values of its key institutions whether in the public and private sector - and it needs to find a way of making the quest for quality the norm. It should be as insupportable for the public sector to build a half-cocked motorway system littered with pinch-points so that tailbacks are endemic as it is, say, for the private sector to convert houses, hotels and flats so they are noisy and barely habitable. Put another way, we will never get a high quality public sector until we are prepared to regulate and create institutions that will get us a high quality private sector - and asking our current private sector to come to the rescue of the public sector, New Labour's big idea, is to invite the blind to lead the blind.

If there are no written values at the core of the state in the form of a constitution or basic law, then there is nothing around which public-spirited excellence can cohere in the public and private sector alike. And there is no provocation in the culture that gives ordinary people the confidence to insist on the best and drop the dreadful British embarrassment about making a fuss. Stern, basically, is right - and little in this election campaign makes me think they won't be able to write something similar in five years' time.

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