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Why doesn't Britain make things any more? (2011)

theguardian.com

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Re: Why doesn't Britain make things any more? (2011)

#61

Post by dash2 »

lostdog wrote: post #45
goatinaboat wrote: post #23

Earlier quoted context omitted.

That’s one possible approach. The one I favour is a total moratorium on new building work in the South East. That’s the only way to force both workers and companies to look to the North. The problem with “tax the rich” is that the numbers of truly rich are tiny and you could swallow their entire fortunes and they’ll be gone in a week. Exercise for the reader, how long would Richard Branson’s entire wealth run the NHS…

All together, UK billionaires have 156 billion pounds [1]. Put a 4% wealth tax on that, and you'll get 6.25 billion pounds. You won't even be making their fortunes smaller, so you could take that amount for forever. The NHS spent 140 billion pounds in 2017 [2], so you would cover 4.5% of the NHS budget just with this wealth tax. That's not insignificant, and we're just looking at billionaires here. UK millionaires ow…

If you take 4% of somebody’s wealth, of course you are making their fortune smaller. Perhaps what you mean is that their fortunes would normally be growing at 4% per year, so overall, they would not decrease. Maybe. I suspect that billionaire’s capital is rather mobile, though.

Re: Why doesn't Britain make things any more? (2011)

#62

Post by lazyjones »

pjc50 wrote: post #41

> Pearson Engineering's Tom Clark has a good story about how the firm's previous owners used to handle industrial relations. Every time the workforce went on strike, which was often, one of the Pearsons would buy a new Rolls-Royce Silver Cloud and drive through the picket line, waving two fingers at his own staff. That does rather sum up 1970s industrial relations. Can you imagine managers like that implementing the…

> Can you imagine managers like that implementing the Toyota Production System? Or anything else where the workers have an individual autonomous contribution? Of course not. So that's why the remaining large car factories are foreign-owned.

I'm not convinced that what you apparently feel is a fair outcome, is an actual logical consequence. Where did manufacturing go? To SE Asia. What is the industrial relations and individual autonomous contribution like in a SE Asian sweatshop?

Re: Why doesn't Britain make things any more? (2011)

#63

Post by pjc50 »

goatinaboat wrote: post #20
achamayou wrote: post #18

Earlier quoted context omitted.

If only there was some sort of regional currency, less susceptible to a single country’s economic changes, that one could use...

What do you suggest? German domination of the Euro has exactly the same effect on Southern Europe, the so-called PIGS.

I could make the argument that London domination of the pound has had the same effect on peripheral counties of the UK. The forces are the same - money flows in to the capital, but the peripheral areas need to keep buying globally produced goods, so money flows out.

Re: Why doesn't Britain make things any more? (2011)

#64

Post by JanSt »

dash2 wrote: post #57
JanSt wrote: post #54

Earlier quoted context omitted.

It‘s not based on facts but on feelings. The facts show that GB had way more rights and power to decide than Germany (exlusions from certain EU rules everyone else accepted etc.) Germany is also by far the single biggest financial contributer to the EU. The GB politicians used to blame the EU for all their own problems. There will be a hard awakening coming at the end of the year, but I‘m sure the EU will still be th…

The general point that the Euro will be controlled by the ECB, which must balance the priorities of all member states, is true. It’s also true that this generates some well-known public goods problems. And it is widely accepted among economists that ECB policy has been better suited to Germany than to e.g. the PIIGS countries of the Mediterranean. Hence the anger about European austerity in Italy, Greece.... Seriousl…

No, you are wrong.

The ECB does not have to balance interests. It‘s independent and it‘s job is monetary stability, not economic interests.

It‘s also not widely accepted that it‘s in Germanys interest. In fact it is against it. Germans hold most of their wealth in cash. They received interest for it. That‘s hundereds of billions now gone. Germans are poorer than most other Europeans (even than Spaniards and Italians) At the same time the southern countries have so high debt loads that they would be bankrupt without QE.

The Euro is too weak for North Europe and to strong for the South.

Re: Why doesn't Britain make things any more? (2011)

#65

Post by lazyjones »

lostdog wrote: post #45
goatinaboat wrote: post #23

Earlier quoted context omitted.

That’s one possible approach. The one I favour is a total moratorium on new building work in the South East. That’s the only way to force both workers and companies to look to the North. The problem with “tax the rich” is that the numbers of truly rich are tiny and you could swallow their entire fortunes and they’ll be gone in a week. Exercise for the reader, how long would Richard Branson’s entire wealth run the NHS…

All together, UK billionaires have 156 billion pounds [1]. Put a 4% wealth tax on that, and you'll get 6.25 billion pounds. You won't even be making their fortunes smaller, so you could take that amount for forever. The NHS spent 140 billion pounds in 2017 [2], so you would cover 4.5% of the NHS budget just with this wealth tax. That's not insignificant, and we're just looking at billionaires here. UK millionaires ow…

> All together, UK billionaires have 156 billion pounds [1]. Put a 4% wealth tax on that, and you'll get 6.25 billion pounds. You won't even be making their fortunes smaller, so you could take that amount for forever.

What a smart and novel idea. Taxing wealthy business owners has worked so well all over the world for years. Let's hope they will never find out about ways to move/split their assets and tax residence.

Re: Why doesn't Britain make things any more? (2011)

#66

Post by icu »

lostdog wrote: post #45
goatinaboat wrote: post #23

Earlier quoted context omitted.

That’s one possible approach. The one I favour is a total moratorium on new building work in the South East. That’s the only way to force both workers and companies to look to the North. The problem with “tax the rich” is that the numbers of truly rich are tiny and you could swallow their entire fortunes and they’ll be gone in a week. Exercise for the reader, how long would Richard Branson’s entire wealth run the NHS…

All together, UK billionaires have 156 billion pounds [1]. Put a 4% wealth tax on that, and you'll get 6.25 billion pounds. You won't even be making their fortunes smaller, so you could take that amount for forever. The NHS spent 140 billion pounds in 2017 [2], so you would cover 4.5% of the NHS budget just with this wealth tax. That's not insignificant, and we're just looking at billionaires here. UK millionaires ow…

Yes but you're ignoring capital flight.

Billionaires and multi-millionaires can just up and leave to more tax friendly destinations.

There are actually tax advantaged schemes (EIS and VCT) in the UK to try and funnel money into emerging tech and new businesses. However you would only invest in them if you were extremely wealthy do too the risks involved.

Re: Why doesn't Britain make things any more? (2011)

#67

Post by pdm55 »

neilwilson wrote: post #42
afarrell wrote: post #16

Earlier quoted context omitted.

But doesn’t this also mean that as a country, Britain or the US can “tax” the economic growth in an arbitrary country which uses its currency as reserve? As Botswanna’s economy expands, it needs to print more money to conduct all the transactions and take advantage of the increased resources provided by an increasingly-skilled workforce. As that country’s central bank prints more money, it tries to acquire more GBP o…

Largely you are correct. It works like this. If you are a net exporter, you are essentially giving away your own output to a foreign nation in exchange for bits of paper. The reason you can't spend that paper is that it would destroy your exports (your own currency would go sky high as the system tried to eliminate the imbalance) and you'd have to find something else for the people working in exports to do, or you'd…

Does anyone know where petrodollars fit in this picture? Do they give the US a particular economic advantage?

Re: Why doesn't Britain make things any more? (2011)

#68

Post by marble-drink »

fmajid wrote: post #46

The UK’s big problem is low productivity, whether in industry or services, and it takes good management, worker training and the judicious application of capital to fix. The financial sector sucks up the best and brightest, leaving only the second-class going into industry, in a form of Dutch disease.

I've found that many workers in the UK are really not that bothered about work. They'll actually turn down work if they don't feel they'll get enough money for it. Just the other day I was in the garage and they were convincing me not to get work done on my car. At that time there were two mechanics just sitting in the shop doing nothing. My theory is these workers are relatively happy with what they get currently, but the next step up is just so far away that they don't even bother going for it.

I wouldn't say the financial industry sucks up the best. In my experience it sucks up the most qualified and pays them too much. But none of the smartest people I know stayed in finance for long.

Re: Why doesn't Britain make things any more? (2011)

#69

Post by goatinaboat »

sleavey wrote: post #39
goatinaboat wrote: post #23

Earlier quoted context omitted.

That’s one possible approach. The one I favour is a total moratorium on new building work in the South East. That’s the only way to force both workers and companies to look to the North. The problem with “tax the rich” is that the numbers of truly rich are tiny and you could swallow their entire fortunes and they’ll be gone in a week. Exercise for the reader, how long would Richard Branson’s entire wealth run the NHS…

Why not tax the merely rich too? I'm probably going to be one of them in a few years. I want to pay more tax to help benefit the society that let me get to where I'm going, but I absolutely want everyone else in my position to pay too. Anyway, I agree with your idea about the south east. As the article points out, Thatcher's policies focused on the south east and ignored the "North" (part of the problem being no one…

I want to pay more tax to help benefit the society that let me get to where I'm going

Well, you can do that anytime you like. Just make a donation to your local hospital, they’ll be more than happy to accept it.

Re: Why doesn't Britain make things any more? (2011)

#70

Post by baybal2 »

blululu wrote: post #14

Just to add to the complexity of the issue: Part of the problem for the UK lies in the strength of the pound. The financial sector is so strong that it drives up the value of the pound beyond the demand for anything made in Britain. This makes it hard to compete on price in pounds. https://en.m.wikipedia.org/wiki/Dutch_disease

> Just to add to the complexity of the issue: Part of the problem for the UK lies in the strength of the pound.

I'll give you a BIG counterexample: China

Strengthening Yuan makes little difference to manufacturers:

1. Say a factory imports $100 components for widgets

2. Adds $10 value in logistics and labour

3. Exports the widget at still competitive price of $120

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