Who do I blame? Eight reasons we ended up in this Brexit mess

Ian Jack in The Guardian

Who’s to blame? There’s no need to ask for what. The problem is where to start. In history lessons at my Scottish high school, the teacher would first divide the causes of a war or other catastrophe by numbers: 1 for long term and 2 for immediate; and then subdivide those broad categories by capital letters, A and B, and so forth; and further subdivide those categories by Roman numerals, (i) and (ii) and so on; and then subdivide again by small letters, (a) and (b) etc. All of which we would copy into our jotters with our Platignum fountain pens. So that the German gunboat sent to Agadir in 1911 found its place as 1C (ix) (d) under nationalism, colonialism and Franco-German rivalry in the list of underlying reasons for the first world war.

It would be good to crystallise the causes of Brexit in a similar tabulation – to have them pinned down and ranked in order of importance so we could understand how it happened, like a soldier in the Flanders mud at last establishing the chain of events, beginning with the award of Bosnia-Herzegovina to Austria in 1878, that had led to his present awful position.

But there isn’t room for that degree of precision. In any case, it’s hard to be so precise. The reasons that follow mix the broad and the narrow.

1. Deindustrialisation The 1980s changed Britain, most of all above the line between the Wash and the Bristol Channel. Between 1979 and 1986, jobs in the manufacturing industry shrank from 7m to 5.1m. Of all the jobs lost, in services as well as manufacturing, 94% were to the north of that line. Deindustrialisation neither began nor ended in the Thatcher years, but it was under Thatcher’s premiership that shutting down factories, shipyards and mines began to seem like a perverse government ambition rather than the consequence of economic misfortune. Wealth and opportunity moved south. The social ruin was terrible. Skills were lost, traditions ended. Part of what it meant to be British disappeared. What was supposed to happen to places such as Oldham and Paisley? Nobody knew. Worse, it seemed nobody cared.

2. Immigration “Nobody asked us,” said the beleaguered inhabitants of the old industrial settlements, and it was true: nobody had. Nor had anyone explained that we, the natives, would need to think differently about where we lived and the kind of people we were – that integration, if that was the hope, needed adjustments on both sides. Nevertheless, immigration had begun to die as a political issue until, in 2004, Tony Blair’s government decided to open the UK labour market to the eight eastern and central European countries that had joined the EU. Only two other member states, Sweden and Ireland, did so as freely. Between 5,000 and 13,000 migrants were expected; within the first year, 129,000 turned up. Blair and other senior Labour figures later conceded they had made a mistake. “Nobody asked us!” said the people who felt strongly about it. (And then, in June 2016, somebody did ask.)

3. Cultural dementia The phrase is the title of a new book by a historian of modern Europe, Professor David Andress, who argues that France, the US and Britain are all engaged in “particular forms of forgetting, mistaking and misremembering the past”. This is more deadly than straightforward nostalgia, which is a form of homesickness. As a population we are older than we have ever been, but in Andress’s words we seem to be “abandoning the wisdom of maturity for senescent daydreams of recovered youth”, and along the way “stirring up old hatreds, giving disturbing voice to destructive rage and risking the collapse of [our] capacity for decisive, effective and just governance”. An example of the daydreams is the belief that the nations of the old empire are “queuing up” to sign trade deals with the country that once ruled them. Empire 2.0.

4. The Dam Busters Last year, the Sun campaigned for a knighthood to be awarded to the last survivor of the RAF crew who carried out the bouncing-bomb raid in 1943. “Give him a dam gong!” was the front-page headline – an adjectival pun. I was in the local newsagent that morning when a man came in, saw the Sun and shouted passionately: “Yeah, give him a medal. If it weren’t for fuckers like him we’d all be speaking fucking German.” I grew up with war films and saw The Dam Busters when it first came out in 1955. Somehow, for reasons I’ve never seen successfully explained, England’s enthusiasm for the second world war (or an Anglocentric version of it) has grown as the event itself has receded, perpetuating old notions of difference and moral superiority. This leads us to ....

5. English exceptionalism Sitting at the top table of nations, punching above our weight, a freedom-loving people ever ready to fight faceless bureaucracies and red tape (Brussels now, but formerly “the little Hitlers in the town hall”): thanks to these predominantly English ideas, especially popular among Tory party members, the UK has fought an expensive battle against the force of gravity throughout my lifetime. Since the day, in fact, when the foreign secretary, Ernest Bevin, wanted an atom bomb with “a bloody great union jack” slapped on the side of it.

6. The playing fields of Eton Their damaging contribution to contemporary British politics includes David Cameron, Boris Johnson and Jacob Rees-Mogg: a too-confident incompetent, an opportunist and a cartoon version of the ruling class. The first is especially hard to forgive.

  An anti-Brexit campaign bus in London. ‘It would be good to understand how it had happened, like a soldier in the Flanders mud at last establishing the chain of events that led to his awful position.’ Photograph: Jack Taylor/Getty Images

7. The newspapers Graham Robb concludes his recent book about the English-Scottish border, The Debatable Land, by wondering how the Europe referendum could have such different results in contiguous constituencies on either side of the boundary. In the north, 56% voted remain; in the south, 60% voted leave. Migrants are sparse in both places. Robb thinks Scottish voters had been “sensitised” to the benefits of EU membership by the independence referendum of 2014, while on the English side “confusion and ignorance” flourished. Robb blames poor education, but what about the Daily Mail, the Sun and the Telegraph? The electoral influence of newspapers may shrinking now, with their circulations, but they are far more rabid in England than in Scotland, and inform far more of the public debate.

8. Complacency During the Scottish referendum campaign in the summer of 2014 I met a painter and decorator on the island of Bute who said he was voting for Scottish independence. “You have to.” Why? He knew people in Sunderland, “and every one of them wants to leave Europe”. Sunderland, with its big car factory that exported cars to the continent? Surely not. “Yes, they want to leave.” He laughed at the daftness of it. I didn’t believe him.

In this Brexit vote, the poor turned on an elite who ignored them

Ian Jack in The Guardian


 

Shipbuilders in Sunderland in the 1980s. Photograph: Sally and Richard Greenhill / Al/Alamy


Just as the pound was reaching its peak, Iain Duncan Smith said: “Turnout in the council estates is very high.” It was about quarter past ten. When he added a few minutes later that he’d been in politics for 24 years and couldn’t remember seeing an equivalent council-estate turnout before, David Dimbleby wondered about its significance: was it good news for the Brexit campaign? Duncan Smith said piously that he couldn’t possibly say, but we knew that he thought it was. By midnight, the pound had begun its fall.

My wife and I grew up on council estates – small, well-gardened ones, a hundred miles from each other across the border of Scotland and England. Almost everyone we knew lived similarly. People of our parents’ generation thought of public housing as a blessing, compared to the shabby and cramped homes they had lived in before. “They talk about council estates as though they’re slums,” my wife said as we watched the coverage. Or native reservations, I thought. Earlier that day on our London high street, a canvasser for remain told me how they divided the work: the Greens got the tube stations, Lib Dems did the shoppers, Labour went “round the estates”.

And, outside Scotland and London, they were mostly ignored. “A large constituency of working-class voters feel that not only has the economy left them behind, but so has the culture,” the American political philosopher Michael Sandel said in a recent interview. “The sources of their dignity, the dignity of labour, have been eroded and mocked by … globalisation, the rise of finance, the attention that is lavished by parties across the political spectrum on economic and financial elites, [and] the technocratic emphasis of the established political parties.” A lot of the energy animating Brexit, said Sandel, had been “born of this failure of elites”.

Sandel refers to a failure common to the western world. But when did the elites begin to fail Britain in particular? An economic historian might point to a period in the late 19th century when Germany overtook Britain in chemical research and technical education and, together with America, began to replace it as the world’s supreme industrial nation. But that was an unconscious failure; active betrayal has come within living memory. As a journalist working in the 1960s and 1970s, I grew used to the story of the factory closure, but only in the 1980s did these apparently random events accumulate to become known by a word, deindustrialisation, that implied a process governments either couldn’t stop, chose not to stop, or took steps to encourage.

The effects across large parts of Britain were spectacular. The big industrial cities had stored up enough capital in terms of public institutions and professional jobs to survive and sometimes prosper as regional capitals. But their hinterlands – the settlements strung along smoky valleys and perched on the oily river’s edge – began to look as abandoned as goldrush towns. Coatbridge, Consett, Hartlepool, Merthyr, Sunderland, Burnley, Greenock, Accrington: unless a senior football team played or a murder took place, they dropped from the national consciousness.

The depth of their oblivion was exemplified when, in a referendum debate on Sky TV, Michael Gove spoke of how his father’s fish business in Aberdeen had been “destroyed by the European Union”, which had “hollowed out” communities across Britain. In fact, a report in the Guardian showed that the senior Gove had sold his business rather than closed it, and that factors other than the EU were then shrinking Aberdeen’s fishing industry, including over-fishing.

What nobody remarked on was the absurdity of Gove calling the EU a job destroyer, when far heavier destruction was inflicted by British government policy during those years. When Mrs Thatcher came to office in 1979, manufacturing accounted for almost 30% of Britain’s national income and employed 6.8 million people; by 2010, it accounted for 11% and employed 2.5 million. And, unlike Mr Gove, a welder who was thrown out of work by a closing Sunderland shipyard had no business to sell.

In no other major economy was industrial collapse so quick. For a time, well-meaning journalists reported the catastrophe, and then gradually the sight of empty towns and shuttered shops became normalised or forgotten.

It seemed there was nothing to be done. At one time, the country’s prosperity had been underpinned by the spinning, weaving, stitching, hammering, banging, welding and smelting that went on in the manufacturing towns; much of the country’s former character was also owed to them – non-conformist chapels, brass bands, giant vegetable championships, self-improvement, association football. Surely nothing as significant to the nation’s economy, culture or politics would ever emerge from them again? And then it did: grievance. Actually, more than that: the sudden discovery that in certain and perhaps unrepeatable circumstances, the poor could use their grievance about all kinds of things to change at least one.

It first became apparent in the Scottish referendum of 2014. Only four local voting areas out of 32 returned a majority for independence and all of them bore the scars of vanished industries. The SNP had broken through years of eroding Labour tradition to capture the loyalty of people in the big housing schemes, for whom the leap in the dark of constitutional change offered promise rather than threat (after all, what else had worked?). By the time of last year’s general election, thousands of underprivileged local authority tenants felt themselves for the first time to be part of a political movement. I noticed the paradox after Nicola Sturgeon addressed an anti-Trident rally in Glasgow, and wrote: “Only now, with the west of Scotland nearly expunged as an economic force, does the political will of its people keep the rest of the country awake.”

On Thursday, much of northern England went to vote in a similar mood. Immigration, actual or potential, mattered too. There may also have been Spitfire enthusiasts. But betrayal, grievance, dispossession: these were surely what counted for most. I feel sorrow that the British story should have such an unexpected end – murdered by the poor and neglected English who were already inside the keep.

How reforms killed Indian manufacturing

Ashok Parthasarathi in The Hindu

As the government pushes for ‘Make in India’, it could begin by unmaking the damage the post-1991 reforms inflicted on domestic industry.

This year marks 25 years since the so-called “economic reforms” were launched in July 1991. By now, broad contours of the policies and practices that characterised such reforms are well known, viz. radical deregulation, marketisation and privatisation of the industrial, technological and financial sectors, and an across-the-board induction of foreign direct investment and foreign institutional investment, and so on.

Basing himself on the erroneous views of India’s IT software and service sector behemoths, the “advice” of Western governments, large foreign companies and the trinity of the World Bank, the International Monetary Fund and the World Trade Organisation, Manmohan Singh, then Finance Minister, concluded around mid-1992 that we could be globally competitive only in IT software and services and not in hardware. Thus he reduced import duties on all IT hardware purportedly to “facilitate” software promotion and growth on a globally competitive basis using imported hardware. Result: by 1994 our fledgling civilian IT hardware industry folded up.

No one seems to have told Dr. Singh that IT hardware far more technologically sophisticated than the commercial hardware being imported by our software companies was being manufactured by Indian defence, atomic energy and space agencies and even exported to other developing countries such as Brazil, Malaysia, and Indonesia.

Death by policy

The “reforms” also dealt a body blow to the indigenous optic fibre telecommunication systems industry, a project begun by the Department of Electronics (DoE) in 1986 with the setting up of the public sector utility, Optel. Based on a global tender, technology-transfer agreements were concluded with two companies, Fujitsu and Furukawa, in 1987 and a blueprint for the Optel plant prepared. It indicated a project cost of Rs.45 crore and a construction period of 30 months; when completed, the actual numbers were Rs.46 crore and 32 months.

All this was possible because I got one of our top technocrat-managers, Bhagwan Khurana, to leave his job as CEO of Punjab Wireless Ltd. (Punwire) and become CEO of Optel. A top-class cluster of three plants was operational by end March 1989. In its very first year of commercial operations Optel’s turnover was Rs.64 crore with a profit of Rs.11 crore. In 1990-91 the turnover zoomed to Rs.298 crore with Rs.35 crore profit.

Around this time, Sterlite, a metallurgical company, and Finolex, a packaging material producer, entered the field. They would import fibres and merely sheath them into cables. Even the sheathing material was imported — the cables had merely 10-15 per cent domestic content. This, however, ran into a roadblock in the form of the graduated customs duties then applicable, which promoted local production. They started lobbying with the government to reduce the import duty on fibre — a manufactured component — from 40 per cent to 10 per cent, which was the duty on raw materials. I was then Secretary of the Electronic Commission and Additional Secretary in the DoE. Despite the DoE’s stout opposition to both the character of the companies’ “projects” and the drastic and irrational reduction of duties, they got their way. Within six months, large quantities of optic fibre began to be imported. Optel had to close down its optic fibre plant and import low-grade fibre from China to be able to compete in our own market with the likes of Sterlite and Finolex!

Deindustrialisation

In 1990-91, there were at least a dozen electronics corporations producing a range of high-tech radio communication equipment, industrial electronics and control and instrumentation equipment worth annually around Rs.6,000 crore. However, the reduction in customs duties from 60 per cent to 30 per cent overall, which led to a glut of imports, forced many of these corporations to halt production and become import agents, a phenomenon repeated in the key solar photovoltaic industry.

“Reforms” also led to large-scale import of cell-phone handsets that could have been easily produced here had a policy of phased manufacture been adopted. Result? The entire market for such handsets was met by unnecessary imports from Day One in 2005-06. In 2013-14 cell-phone imports totalled Rs.35,000 crore.

By 2000, foreign brands grabbed 80 per cent of the television sets market, from a situation where 10 local companies catered almost fully to the demand. Six of the 10 indigenous television makers have folded up, with a ripple effect on the electronic components sector.

My final example is our heavy electrical equipment industry led by Bharat Heavy Electricals Limited (BHEL). Up until 1998-1999 this industry was doing very well. However from the next year onwards, four Chinese power plant equipment manufacturers began to seriously erode BHEL’s market. This erosion was despite the quality and technical reliability of the Chinese equipment being considerably inferior to BHEL’s products. The United States, home to General Electric and Westinghouse, imposed penal anti-dumping duties on Chinese power plant equipment. Yet, the Indian government merely watched as BHEL lost 30 per cent market share by 2014.

These examples indicate that in sector after sector, the “reforms” have led to deindustrialisation. Products that we were manufacturing in the 1990s are being imported now. The negative impact this deindustrialisation has had on employment and on our economy is gigantic. The government must act immediately to halt the destruction of domestic industry on such a massive scale instead of merely tom-tomming its “Make in India” policy.

(Ashok Parthasarathi was the Science and Technology Adviser to the late Prime Minister Indira Gandhi.)