Do we need a Department of Culture, Media & Sport

[Twincam16]

AJS- said:

My point isn't to get at farmers who want broadband or museums, or anyone else. And it's not about smashing down culture or selling national treasures to McDonalds either. The point is to find the savings from somewhere, so that we can get government back to a more realistic size, because when we have a debt default or a collapse of the currency or are unable to borrow any more money, we probably won't have any choice at all about what to cut or when to cut it.

And I'd suggest another method.

Increase productivity. Increase GDP. Encourage the banks to lend to businesses, taking a long-term view, so they can improve our situation with a simple equation - the more stuff we make and sell, the more profit we get in, therefore the smaller proportion of GDP is required by the government simply because there's more GDP in the first place.

The biggest folly of Blair's tenure was this notion that the City had become this magic money-tree, simply moving money around betting on things for profits. It worked for a short while, but Blair and Brown's policy was criminally neglectful of the rest of the country. Just look at the way they behaved with regards to MGR and LDV - they just didn't care if we lost manufacturing capacity and thousands were laid off, because those people could be appeased on the balance sheets by benefits and public-sector job-creation schemes. Education and employment decline - and ultimately the emergence of the NEET - was a pure creation of Blair's Britain. People rendered unproductive by a completely City-focused economy.

In retrospect, not even Thatcher went as far as Blair. There was a sense of patriotism about Thatcher's administration that ensured some certain businesses - Austin-Rover, Jaguar, Sinclair, Amstrad, British Aerospace and Avro among others - were vigorously protected by government support and subsidy. Under Blair, these kinds of business either went down the stter or were sold to foreigners. In retrospect, Mandelson's belated efforts to rescue Vauxhall smack of PR penance in the wake of MGR and LDV.

Even more so than Thatcher, the Blair administration seemed to push the notion that manufacturing and engineering were yesterday's professions, and that the future was in banking and the creative industries. Look at the sort of things kids were encouraged to study at school and university under Blair - and now look how those kids are struggling now they've graduated with a heap of debt and a useless degree. The most successful are relying on family money and connections.

Ad look where our success stories are and where our growth areas require people. High-quality cars. Engineering. Manufacturing for export. Aircraft parts. Civil engineering. We desperately need more engineers, scientists and skilled craftsmen. Even on a smaller level, the most successful businesses are the artisan/boutique-types selling uniquely British products, like Morgan, or Linn, or Scotch Whisky distilleries, or vinyards making English sparkling wine.

The age of the casino banker is over. They proved themselves to have failed and the economic model they represent doesn't work, no matter how they'll protest about it. Britain's future is in making things to very high standards, protecting traditional methods it's hard to just 'pick up', and selling them to foreigners. And in order to facilitate this, the banks must lend, and not expect to see a profit for years.

[AJS-]

I agree with much of what you say. The "how" question remains though. How do you encourage banks to invest in something that may or may not make money in 10 years time, versus something that probably will in 1 years time.

Lambast the banks all you like, but in my view the problem lies with those who fail to convince the banks to lend to them. Banks are crying out for good investments, but only if they can see a viable safe return.

[Twincam16]

That's not really the problem at the moment. There's a culture of remote, selfish short-termism running through British banking whereby all investments seem to be made on near-instant returns and zero investor involvement. Bankers need to accept that 'viability' isn't necessarily all about next quarter's bonus and that big, mass-employing projects experience ups and downs and take time to bear fruit.
It'd help if we switched the banking cycle to a four-yearly system with year-long quarters.

[martin84]

Banks have gone from one extreme to another. For years they'd happily lend money which any sane person could see would never be paid back. Since the crash and subsequent bail out, they'll only put money into 'sure things.' In my view a sure thing doesn't come along that often.

To quote the late Bob Hope A bank is a place that will lend you money if you can prove you don't need it.

[AJS-]

That's all well and good, but it doesn't go any way towards mitigating the very real and current problem of having a crippling public debt that is growing by the minute.

Of course more growth and more money would help everything, but that isn't happening.

[sd477667]

Heaps of departments need shutting ASAP - can't see why Pickles didn't start with this

anything to do with environment, diversity, CSA, arts, gay/lesbian, ebay tax inspectors and the like - all a complete and utter waste of money