Is the UK government finally getting serious about industrial strategy?

Some industry, of the sort that might feature in a strategy. Image: Getty.

The new UK government under prime minister Theresa May has brought with it a welcome change of tone on industrial strategy. We have now heard more about what the government actually intends to do: this week, it has set out ways it can provide support to businesses, including an effort to address regulatory barriers, to agree trade deals and help to establish institutions that encourage innovation and skills development.

It is a genuine change of tone. The previous business secretary Sajid Javid couldn’t even bring himself to utter the words “industrial strategy”. By contrast, May has emphasised its role and identified new sectors – in addition to automotive and others – that could receive government support: life sciences, low carbon vehicles, industrial digitalisation, creative industries and nuclear.

This accompanies government plans to boost STEM (science, technology, engineering and maths) skills, digital skills and numeracy, including extending specialist maths schools, with £170m to be invested in creating new “institutes of technology”. So far, so good. But does it go far enough?

Manufacturing weakness

The coalition government under David Cameron had a patchy record on industrial strategy. The then-chancellor George Osborne made promising noises about rebalancing the economy and a “march of the makers”, but much was empty rhetoric. Some support was made available to rebuilding the UK’s fractured supply chains and to encouraging rebalancing, but the sums on offer were small and failed to match the scale of Osborne’s hot air.

Osborne’s legacy: many hard hats, fewer hard policies. Image: British High Commission, New Delhi/Flickr.

Indeed, the manufacturing recovery since the financial crisis has been weak, characterised by concerns over low levels of investment spending, the impact of high energy costs across the sector, and issues of skills and access to finance down the supply chain.

The last government fumbled regional development strategy and offered meagre funding. And it also made no attempt to address the UK’s lax takeover rules, which unlike in other countries do very little to protect strategically important businesses from foreign predators.

On the positive side, we did get a series of so-called “Catapults”, where businesses, engineers and scientists work together on late-stage research and development. These retain much political support, but they need to be better funded, with a long-term commitment from government. Equally encouraging has been the work of the Automotive Council, which started under Labour and which developed under Vince Cable into an effective body in fostering public–private cooperation.

Piece by piece, building a strategy. Image: I am dabe/Flickr.

Modern industrial policy in other countries is often seen as a process of knowledge discovery, and the Automotive Council shows that the UK can operate in this way, too. It sets out clear priorities for technologies that need to be developed, securing government support which has underpinned business confidence and investment. The Council had been backed up by modest government interventions to boost skills, rebuild supply chains, and encourage investment in the industry, all of which were scrapped under Javid’s tenure.

Choppy waters

Now comes a chance to start righting the ship. May’s industrial strategy brings with it a new “place-based” focus which could be crucial in making a national sectoral or technology policy work effectively by enabling it to be better tailored to the needs of regions and places.

A strategy also needs an institutional anchor. Let’s hope that the government looks again at the local enterprise partnerships (LEPs) and returns to development bodies that can intervene more widely and strategically in ways that make sense at a regional level.

Combined Authorities – such as in the West Midlands – may be one way to do that. It is an area where the new business secretary Greg Clark has much expertise. Beefing up the local growth hubs to fill the vacuum left by the abolition of the Manufacturing Advisory Service could be part of a new “Combined Authority Plus” model. A complete devolution of skills funding to the regional level would also help.

There is also much more that the government could be doing if it really wants to “rebalance” the economy. We should be stimulating investment in manufacturing through enhanced capital allowances, by resurrecting something like the Advanced Manufacturing Supply Chain Initiative (preferably on a much wider scale), and by plugging funding gaps for small firms in the supply chain.

It will be crucial, too, to do something about UK takeover rules to put the country on a level playing field with many of its main competitors. More broadly, there is a strong case for UK industrial strategy to be afforded an institutional status similar to both UK monetary and fiscal policies. At the very least, it should be the subject of regular strategic long-term reviews. By giving it that sort of priority, the new government would send out the kind of powerful message that British industry badly needs to hear.

Despite some frequent missteps, from New Labour to post-crisis austerity, there has remained a modest element of continuity in industrial policy. Quite how far the new strategy will go in building on this will be a key question. On a positive note, the new business secretary is perhaps unique in government in bringing with him a welcome devolving instinct that offers the possibility to join up sectoral policy at the national level with that “place-based” policy at the regional level.

Let’s hope the new government really is more serious about the need to rebalance the economy than the last one. More rhetoric about the “march of the makers” won’t be enough, especially in a post-Brexit economy.The Conversation

David Bailey is professor of industry at Aston University.

This article was originally published on The Conversation. Read the original article.


America's cities can't police their way out of this crisis

Police deployed tear gas during anti-racism demonstrations in Los Angeles over the weekend. (Mario Tama/Getty Images)

As protesters took to the streets across the United States over the weekend to express their anger at police killings of unarmed black Americans, it was hard to miss the hypocrisy coming from local authorities – including the otherwise progressive, left-leaning officials who are in power in most major American cities. 

Many US mayors and their police chiefs had issued public statements over the past week that seemed – only briefly, as it turned out – to signal a meaningful shift in the extent to which the Black Lives Matters movement is being taken seriously by those who are in a position to enact reforms. 

The sheer depravity of the most recent high-profile killing had left little room for equivocation. George Floyd, 46, died last Monday under the knee of white Minneapolis police officer Derek Chauvin, while three additional officers helped to hold Floyd down, doing nothing to aid him as he begged for them to stop and eventually lost consciousness. The officers had been attempting to arrest Floyd on suspicion of having used a counterfeit $20 bill at a deli. All four have since been fired, and Chauvin was arrested Friday on charges of third-degree murder and second-degree manslaughter. 

“The lack of compassion, use of excessive force, or going beyond the scope of the law, doesn’t just tarnish our badge—it tears at the very fabric of race relations in this country,” Los Angeles Police Chief Michel Moore told the Washington Post in response to the Floyd case. Meanwhile Moore’s boss, Los Angeles Mayor Eric Garcetti, on Friday claimed that he understood why his city, which is no stranger to police brutality, was protesting. “We absolutely need as a nation, certainly as a city, to voice our outrage, it’s our patriotic duty to not only stand up for George Floyd but for everybody who has been killed unnecessarily, who’s been murdered for the structural racism that we have in our country,” Garcetti said. 

Normally, US police chiefs and mayors tend to ask citizens to withhold judgment on these types of cases until full investigations can be completed. But a 10-minute video recording of Floyd’s killing had made what happened plain. Police chiefs across the country – and even the nation’s largest police union, which is notorious for defending officer abuses – similarly condemned the actions of the Minneapolis officers, in a rare show of moral clarity that, combined with the arrest of Chauvin, offered at least a glimmer of hope that this time things might be different. 

As the events of the weekend have since shown, that glimmer was all too fleeting. 

In city after city over the past three days, US mayors and their police chiefs made a series of the same decisions – starting with the deployment of large, heavily armed riot units – that ultimately escalated violent confrontations between officers and protesters. Images widely shared on social media Saturday and Sunday nights made it clear that members of law enforcement were often initiating the worst of the violence, and appeared to treat protesters as enemy combatants, rather than citizens they were sworn to protect. 

In New York City, two police SUVs were seen plowing into a crowd of protesters, while elsewhere an officer was recorded pulling down a young protester’s coronavirus mask in order to pepper spray his face

In Louisville, the city where Breonna Taylor, a 26-year-old black woman was fatally shot by police on 13 March, state police in riot gear were captured confiscating and destroying protesters’ supplies

In Minneapolis, forces opened fire with nonlethal rounds on residential streets, much to the shock of homeowners standing on their own front porches. 

Images of police pushing or shoving peaceful protesters were almost too numerous to count, including, in Salt Lake City, an elderly man with a cane

In many places, police also targeted journalists who were covering the protests, firing at clearly identifiable media crews with rubber bullets, injuring and even arresting reporters

Some protesters did commit acts of vandalism and looting, and the leaders of cities where that happened generally responded in the same ways. 

First, they blamed “outside agitators” for the worst protester behaviour, a claim that harkens all the way back to the civil rights era and for which the evidence is murky at best

Next, they enacted sudden curfews with little to no warning, which gave law enforcement an excuse to make mass arrests, in some cases violently. 

In a pair of widely criticized moves, Garcetti of Los Angeles closed the city’s Covid-19 testing centers and suspended the entire mass transit system Saturday evening, stranding essential workers on their way home from daytime shifts. Late Sunday night in Chicago, the city’s public school system halted its free meal distribution service for low-income children, citing “the evolving nature of activity across the city”.  

Governors in at least 12 US states, in coordination with city leaders, have since called in National Guard troops to “help”. 

At this point it’s clear that the leaders of America’s cities are in desperate need of a radically different playbook to respond to these protests. A heavily armed, militarised response to long-simmering anger toward the heavily armed, militarised approach to American policing is more than ironic – it’s ineffective. Granting police officers wider latitude to make arrests via curfews also seems destined to increase the chances of precisely the tragic, racially biased outcomes to which the protesters are reacting. 

There are other options. In places such as Flint, Michigan, and Camden, New Jersey – both poor cities home to large black populations – local law enforcement officials chose to put down their weapons and march alongside protesters, rather than face off against them. In the case of Camden, that the city was able to avoid violent clashes is in no small part related to the fact that it took the drastic step of disbanding its former police department altogether several years ago, replacing it with an entirely new structure. 

America’s cities are in crisis, in more ways than one. It’s not a coincidence that the country has tipped into chaos following months of emotionally draining stay-at-home orders and job losses that now top 40 million. Low-income Americans of colour have borne a disproportionate share of the pandemic’s ravages, and public health officials are already worried about the potential for protests to become Covid-19 super-spreading events.

All of this has of course been spurred on by the US president, who in addition to calling Sunday for mayors and governors to “get tough” on protesters, has made emboldening white nationalists his signature. Notably, Trump didn’t call on officials to get tough on the heavily armed white protesters who stormed the Michigan Capitol building over coronavirus stay-at-home orders just a few weeks ago. 

US mayors and their police chiefs have publicly claimed that they do understand – agree with, even – the anger currently spilling out onto their streets. But as long as they continue to respond to that anger by deploying large numbers of armed and armored law enforcement personnel who do not actually live in the cities they serve, who appear to be more outraged by property damage and verbal insults than by the killings of black Americans at the hands of their peers, and who are enmeshed in a dangerously violent and racist policing culture that perceives itself to be the real victim, it is hard to see how this crisis will improve anytime soon. 

Sommer Mathis is the editor of CityMetric.