Where did Britain go wrong?

[Iskra]

I think that financially, due to shareholders the economics of just about everything are too geared towards inflating short-term/immediate profit whatever the damage, rather than long-term sustainable investment that delivers benefits further down the line. This has started a spiral of decline that it's very hard to ever break, even if the mentality to do so existed.

 

[nlogax]

The replies to this question show how different "gone wrong" is perceived.
Some people mentioned prosperity, some being the "best" in the world.
Happiness hasn't been mentioned.
Id rather live in a country that constantly ranks in the top of the happiness leagues (like the Scandinavian countries) rather than a proporous country (like the gulf States).

At last reckoning the UK was globally ranked 17th out of 146 countries for happiness ... Covid probably set us back after some good progress up to 2019. Happiness doesn't feel as though it's permeating through society at the moment. We have recalcitrant leadership, polarisation across the social and political spectrum feels wider than ever, health and social care is in an appalling state and rampant inflation has ensured almost everything costs a metric s...-ton more than it did a year ago while wages continue to fall behind.

Whether we currently have it worse than other similar countries I have no idea. Maybe others who know more can pitch in here?

 

[Bevan Price]

In Thatcher's first Parliament (1979/83), there were - on average - roughly 2000 lost jobs - for every single day.
Manufacturing industry was allowed to decline. Factories were often sold to overseas owners (with little interest in UK), and/or to asset strippers.
Even former PM Harold Macmillan (no friend of Labour) claimed she was selling "the family silver" with her doctrinaire privatisations.


We have never really recovered.....

 

[alex397]

Western women are generally encouraged to put childbearing on hold and put their career first. Equality of opportunity and all that. Sadly mother nature doesn't take overly kindly to this principle and many find themselves childless by 40 with no winner of a man wanting to procreate with them.

Not sure you needed to word that quite so crudely!

 

[43096]

In Thatcher's first Parliament (1979/83), there were - on average - roughly 2000 lost jobs - for every single day.
Manufacturing industry was allowed to decline. Factories were often sold to overseas owners (with little interest in UK), and/or to asset strippers.
Even former PM Harold Macmillan (no friend of Labour) claimed she was selling "the family silver" with her doctrinaire privatisations.


We have never really recovered.....

If you're suggesting that the 1970s were the halcyon days of the British economy, then you need to brush up on your history!

 

[Snow1964]

I think it goes back to 1950s, and the then culture of not making our factories more productive by mechanising further, so they can compete with best in world.

Instead we went for importing cheap Labour force, initially from commonwealth, later Eastern Europe. Then discovered that cheaper to just make it abroad where cheap labour force is located. So now vulnerable to import price shocks which we can't offset by exports of other products made in UK.

Factories which hadn't been modernised to be competitive internationally collapsed or were shut down, especially in Thatcher era

 

[Gloster]

Britain has not in modern times suffered the wars, invasions or revolutions that most countries have undergone, and which have allowed them to rebuild and refocus their societies, at least to some extent. Here we have never forced the rich and privileged to give up their ultimate control of the country. There have been changes and they have give up some things, but only to shift to others that are of more advantage to them. Their one aim is to maintain their status and comfort, and they have never had to make serious compromises in order to keep going. Instead they just keep going and doing things their way: in some ways it has got worse over the last forty or so years (well forty-four, actually) as it has almost become desirable to flaunt their riches or status. Many of those gains that were made have been lost and, due to the way the economy, etc. has developed (been rigged), it will take a long time to get back what we found and lost.

 

[deltic]

In Thatcher's first Parliament (1979/83), there were - on average - roughly 2000 lost jobs - for every single day.
Manufacturing industry was allowed to decline. Factories were often sold to overseas owners (with little interest in UK), and/or to asset strippers.
Even former PM Harold Macmillan (no friend of Labour) claimed she was selling "the family silver" with her doctrinaire privatisations.


We have never really recovered.....

Ah, those halcyon days when Red Robo led 523 walkouts at British Leyland over a 30 month period and no-one wanted their cars. When there were months long waiting lists to get a telephone line installed. Unemployment when Thatcher became PM was 3.8% - when she left office it was 5.9%. Poor management and lack of investment destroyed manufacturing and the fact that consumers preferred more reliable Japanese cars and consumer products. Younger people will probably find it hard to believe that the state owned, car companies, travel agents, hotels, airlines, airports, sugar manufacturers, computer manufacturers, oil companies, brewers and a host of other businesses that operate in competitive markets.

I have never voted Conservative but I find this obsession with blaming Thatcher for the UK's economic and social problems bizarre.

 

[Fleetmaster]

Tony Blair.

The first man to approach and execute politics as if our system of government were a Presidency, which, for a country that invented and refined over generations the system we do have, was a very unsuitable arrangement.

Arguably gave rise to both Johnson and Corbyn, for very different but still equally moronic reasons.

== Doublepost prevention - post automatically merged: 15 Mar 2023 ==

In Thatcher's first Parliament (1979/83), there were - on average - roughly 2000 lost jobs - for every single day.

And yet GDP went up and inflation went down.

Short term effects only perhaps, but a pretty clear sign those jobs had been contributing nothing to the economy except unwarranted wage inflation.

 

[RT4038]

Britain has not in modern times suffered the wars, invasions or revolutions that most countries have undergone, and which have allowed them to rebuild and refocus their societies, at least to some extent. Here we have never forced the rich and privileged to give up their ultimate control of the country. There have been changes and they have give up some things, but only to shift to others that are of more advantage to them. Their one aim is to maintain their status and comfort, and they have never had to make serious compromises in order to keep going. Instead they just keep going and doing things their way: in some ways it has got worse over the last forty or so years (well forty-four, actually) as it has almost become desirable to flaunt their riches or status. Many of those gains that were made have been lost and, due to the way the economy, etc. has developed (been rigged), it will take a long time to get back what we found and lost.

Are you suggesting that those countries that have suffered wars, invasions or revolutions don't have their rich and privileged with ultimate control of the country, one of whose aims is (obviously) to maintain their status and comfort? Looking around to other countries that doesn't really seem to be the case generally.

I find it laughable to suggest that Britain in the 1970s was a better place - yes, you could pick certain elements with rose tinted spectacles that were, but balancing all the factors in general - no way. I do not think it possible to point at a particular place in the history of Britain and say that is where the 'mistake' is, we are where we are. (allowing a Norman invasion? collecting an empire? having an Industrial revolution? bankrupting ourselves fighting wars? etc etc). Whether having a revolution or not makes any difference - France or Russia doesn't seem to be in a particularly better position than us?

 

[DarloRich]

People allowing themselves to be convinced that the Tories are on their side! Hint: They aren't.

 

[Meerkat]

Socialism. The Labour Party had a mandate to improve things for housing and health and instead wasted it on nationalising everything in sight, and thereby breaking it.

Possibly its also a factor of being one of the oldest democracies - the electorate have realised the huge flaw in democracy, that they can vote for more and more goodies and vote against anyone who says they should pay for them rather than load the bill on future generations.

 

[Couru]

And yet GDP went up and inflation went down.

Short term effects only perhaps, but a pretty clear sign those jobs had been contributing nothing to the economy except unwarranted wage inflation.

A country's success is not merely measured by GDP and inflation. Jobs do not have to contribute to the economy to be important (for example, local councillors don't directly contribute to gross domestic product but are vital nonetheless).

Also, wage-push inflation is an economic theory with little empirical evidence to back it up (see this 1981 study by the St Louis Federal Reserve, page 25). Wage costs are rarely the driving force of raising prices; in fact, the opposite is true whereby raising prices are the driving force of wage costs. Inflation is usually caused by intentional monetary policy by central banks and supply shocks - if wage increases play a part, its very minor in comparison to those two.

 

[DarloRich]

Socialism. The Labour Party had a mandate to improve things for housing and health and instead wasted it on nationalising everything in sight, and thereby breaking it.

Possibly its also a factor of being one of the oldest democracies - the electorate have realised the huge flaw in democracy, that they can vote for more and more goodies and vote against anyone who says they should pay for them rather than load the bill on future generations.

Since 1900 Labour have won 8 out of 32 elections. Only 3 leaders have won elections: MacDonald, Wilson and Blair. In 122 years of existence Labour have been in power for 30.

They must be doing some damage.

PS - i take the point about the electoral system.

 

[A0]

I think that financially, due to shareholders the economics of just about everything are too geared towards inflating short-term/immediate profit whatever the damage, rather than long-term sustainable investment that delivers benefits further down the line. This has started a spiral of decline that it's very hard to ever break, even if the mentality to do so existed.

That's a gross misrepresentation of what shareholders require - some look for short term profits, but not all. Look at the kind of companies that pension funds invest in, they want steady, consistent returns over the medium / long term.

The challenge for both companies and shareholders is how long do you keep down a path which is progressively losing you customers ? In my 25+ year working career I've held Head Office roles in 3 retailers, one is still trading, one is defunct and one is now owned by somebody else.

The first of those 3 had a clear strategy, it closed stores when they weren't profitable. They moved quickly into new product areas and deleted others when they were starting to fail.

The second of those was running an estate where a number of stores were loss making, yet people harked back to how those stores used to be profitable as the justification for "one more year and they'll be fine". Add in a confused focus in terms of what the company was selling, inconsistent ranging etc.

The third was more like the first in terms of managing its estate, but held onto legacy product areas alot longer than other retailers. Fine if there's still the demand but it ties up cash and space holding those.

The problem is the armchair critics all say the problem with the first of those is they deserted the high street (which they did, but because they couldn't get retail units which were fit for their needs) and didn't keep as many products (because they were focused on the top selling lines), and were "overpriced" - which they weren't - they were ensuring every item they sold was profitable, because the margins were relatively low.

The armchair critics would say of the second company 'oh but its good they are supporting the high street', but those self same critics wouldn't actually *use* those stores, because they'd compare the prices with mail-order or online and buy from there.

If you'd bought shares in any of those three companies, you'd have lost capital value no doubt, but the first still exists and still pays you dividends, the second you'd have lost your money and the third you'd hold some different shares which are doing "OK" you'd be in a similar position to the first.

 

[A0]

In Thatcher's first Parliament (1979/83), there were - on average - roughly 2000 lost jobs - for every single day.
Manufacturing industry was allowed to decline. Factories were often sold to overseas owners (with little interest in UK), and/or to asset strippers.
Even former PM Harold Macmillan (no friend of Labour) claimed she was selling "the family silver" with her doctrinaire privatisations.


We have never really recovered.....

A bit rich of Macmillan to criticise because many of the economic policies he'd pursued actually caused the issues in British industry.

A perfect example would be the demand that Rootes Group built their new factory in Linwood, over 300 miles away from their manufacturing base in the West Midlands and their key suppliers.

It meant the Imp when launched was poorly built and loss making due to the cost of having to ship parts all over the country.

Unsurprising that when Chrysler Europe collapsed and PSA took over one of the first things they did was close Linwood.

 

[Meerkat]

Since 1900 Labour have won 8 out of 32 elections. Only 3 leaders have won elections: MacDonald, Wilson and Blair. In 122 years of existence Labour have been in power for 30.

They must be doing some damage.

PS - i take the point about the electoral system.

That's a fair point - the Tories didn't privatise early enough. But it was Labour, and socialist tendencies more widely, that caused the problem.

 

[DarloRich]

the Tories didn't privatise early enough. But it was Labour, and socialist tendencies more widely, that caused the problem.

I am not sure I agree with the whole point you make. Surely there was little choice but to nationalise after the war to meet the post war challenges of an essentially bankrupt and war damaged country? Worth noting that industry had, effectively and quite successfully, been nationalised during the war and that nationalisation of the mines had been a long standing and popular Labour policy.

I would also question when those industries could have been sold off. Was the economy and the post war consensus able to support such policies before Thatcher?

 

[Meerkat]

I am not sure I agree with the whole point you make. Surely there was little choice but to nationalise after the war to meet the post war challenges of an essentially bankrupt and war damaged country? Worth noting that industry had, effectively and quite successfully, been nationalised during the war and that nationalisation of the mines had been a long standing and popular Labour policy.

I would also question when those industries could have been sold off. Was the economy and the post war consensus able to support such policies before Thatcher?

If the country is bankrupt I'm not sure why the government would be best placed to finance a revival of everything. And the most destroyed western country, Germany, didn't nationalise steel and shipbuilding etc AIUI
What industry was nationalised during the war - pretty sure steelworks, shipyards, car makers weren't, even the companies making planes and tanks weren't.
Nationalisation of mines was probably popular with miners, but was anyone else keen?

 

[DarloRich]

And the most destroyed western country, Germany, didn't nationalise steel and shipbuilding etc AIUI

After the war the industrial capacity of Germany was, to all intents and purposes, nationalised but to the western powers. They funded and kick started the German economy using Marshall plan funding. Look at Volkswagen. I guess the difference is those industries were not held in government control after about 1950. That might have had something to do with not wanting to replicate Nazi control of German industry.

What industry was nationalised during the war - pretty sure steelworks, shipyards, car makers weren't, even the companies making planes and tanks weren't.

Almost all industry in this country was under governmental direction if not control during the war. In many cases companies were told what to build and when. Railway works built tanks, Car builders built Lancaster's and Spitfires. Aircraft companies built competitors products. Shipyards built standard designs. I suspect the government paid to retool these companies but investment.

I would say that was pretty close to nationalisation!

== Doublepost prevention - post automatically merged: 15 Mar 2023 ==

If the country is bankrupt I'm not sure why the government would be best placed to finance a revival of everything.

because they were the only ones who could access funding from the USA

Nationalisation of mines was probably popular with miners, but was anyone else keen?

IRC the mine owners were not, entirely, against the plan. Profits were falling and investment was needed. They didn't have the cash.

 

[yorksrob]

Only 3 leaders have won elections: MacDonald, Wilson and Blair. In 122 years of existence Labour have been in power for 30.

You forgot the most important one !

 

[DarloRich]

You forgot the most important one !

how did i manage that? I think I meant to add other than Atlee!

 

[yorksrob]

I think I meant to add other than Atlee!

Fair doos

 

[eldomtom2]

I think it goes back to 1950s, and the then culture of not making our factories more productive by mechanising further, so they can compete with best in world.

Instead we went for importing cheap Labour force, initially from commonwealth, later Eastern Europe. Then discovered that cheaper to just make it abroad where cheap labour force is located. So now vulnerable to import price shocks which we can't offset by exports of other products made in UK.

Factories which hadn't been modernised to be competitive internationally collapsed or were shut down, especially in Thatcher era

What country was modernising to be internationally competitive by your standards? The entire West found it extremely difficult to compete with the Far East on price.

 

[duncanp]

People allowing themselves to be convinced that the Tories are on their side! Hint: They aren't.

...as well as people allowing themselves to be convinced that "...things can only get better..." if Labour come to power.

Hint : they won't.

 

[Bletchleyite]

...as well as people allowing themselves to be convinced that "...things can only get better..." if Labour come to power.

Hint : they won't.

That depends on what you consider to be "better".

Will the country suddenly get amazing public services with no tax increase? No, clearly not.

Will Labour consider increasing tax to provide higher quality services on a model a bit more Scandinavian? Yes, probably, and I see that as better, whereas I suspect you may not. I don't buy Tesco Value meat, and I don't want Tesco Value public services either.

 

[Kite159]

...as well as people allowing themselves to be convinced that "...things can only get better..." if Labour come to power.

Hint : they won't.

Agreed, both options are just not appealing. I wouldn't trust the current labour party to run a bath. All talk about how they will make things better without any real details into how, other than raising taxes. Although not like the current Tory bunch are any better.

It will be like voting between eating poo or drinking vomit, neither are that appealing.

 

[Sad Sprinter]

That depends on what you consider to be "better".

Will the country suddenly get amazing public services with no tax increase? No, clearly not.

Will Labour consider increasing tax to provide higher quality services on a model a bit more Scandinavian? Yes, probably, and I see that as better, whereas I suspect you may not. I don't buy Tesco Value meat, and I don't want Tesco Value public services either.

Then the tabloids will moan about high public spending, the tories will promise slashing taxes, win an election and the whole sorry cycle starts again

 

[Bletchleyite]

Agreed, both options are just not appealing. I wouldn't trust the current labour party to run a bath. All talk about how they will make things better without any real details into how, other than raising taxes. Although not like the current Tory bunch are any better.

I certainly do think Starmer needs to come out with some actual policies.

Building HS2 in full would be a good start.

 

[Meerkat]

After the war the industrial capacity of Germany was, to all intents and purposes, nationalised but to the western powers. They funded and kick started the German economy using Marshall plan funding. Look at Volkswagen. I guess the difference is those industries were not held in government control after about 1950. That might have had something to do with not wanting to replicate Nazi control of German industry.

It all ended up back with the original owners didn't it? (I would have seized it then privatised it, to penalise those owners who had aided the Nazis)
And getting it back into private hands seems to have worked better than our nationalised equivalents.

Almost all industry in this country was under governmental direction if not control during the war. In many cases companies were told what to build and when. Railway works built tanks, Car builders built Lancaster's and Spitfires. Aircraft companies built competitors products. Shipyards built standard designs. I suspect the government paid to retool these companies but investment.

I'm no expert but the yards and factories were still competing for contracts weren't they? Possibly they were told what they couldn't produce (ie new railway carriages) and had to adapt, but I thought they offered to make particular things rather than the government allocating who would do what.
But anyway private ownership worked during the war - the government could have maintained more controls/regulations after the war rather than the dead hand of government ownership.