Great article. I've often thought that the British horror at how America lets cities die (like Detroit) is entirely misplaced, the rise and fall of towns and cities is completely natural. When a town only exists due to one specific industry from the 19th century, why must it be supported by the state to continue indefinitely? It makes no sense either economically or for the wellbeing of the residents.
As you touched on, I think Britain's reliance on mass immigration is tightly linked to the freezing of internal migration. The south east has swelled with people from abroad because they have not come from other regions of Britain.
Finally, I imagine another important reason the textile industry was not given state support was that its output was not need as a national security issue.
Another excellent article. It's quite ironic that one of the few examples where the British state successfully "ran down" an old industry was with the railways which, arguably, are one of the few that actually benefit greatly from centralisation and state support. It's certainly a "loss-leader" situation but the infrastructure benefit of a robust and widespread rail system is well known.
The Beeching Cuts may have been right to axe services and stations to areas which no longer needed it but the malaise of the industry in general has continued to hamper transport infrastructure in this country.
The UK is unusual among major economies in having its political, economic and cultural capitals in the same city. Fixing that would boost aggregate activity because private sector growth is inhibited in London by costs, labour availability and planning constraints, while much of the rest of the country subsists on formal and de facto transfers.
Thank you for this genuinely insightful article. I feel that I understand the British economy a bit better. I’m reminded of the song Everyday is Like Sunday and the seaside town they forgot to shut down. It is sometimes more compassionate to put an end to moribund municipalities and ways of life.
I’m reminded of the Canadian regional development situation. Canada has eternally faced the problem of the underdevelopment of the Atlantic provinces, as well as certain regions in other provinces such as Northern Ontario.
The difference is that these were never plausible industrialization candidates, although significant funds were spent on futile efforts such as the Bricklin automobile. We also have pointless shipyards in Quebec and Atlantic Canada that seem unable to actually build ships.
We do get over investment in government to those regions, to the point that their government services are often better than in wealthier regions. But they are aging populations that are totally unviable without government support. At least these regions are relatively small in Canada and somewhat affordable, at least up to now.
We also see odd effects on immigration. For example, unviable community colleges in Northern Ontario were permitted to establish partnerships with sham private colleges in the Toronto area and essentially sell diplomas to Indian immigrants who wanted immigration status. We are now seeing horrible effects in housing and medical services, along with a flood of low wage, unproductive labour.
Great article - I noticed that NI was conspicuously absent despite being the biggest basket case of the lot. You have an intensely patriotic labour force in the form of the loyalist community who have been sat twiddling their thumbs since the decline of the shipyards. Cut their gibs and they'd be forced to migrate in order to make a tangible contribution to the country they venerate. Then you have a significant body of Catholics who have benefitted massively from our intact grammar school system (there are 67 grammar schools in NI and our population is under 2 million) and who have excelled in an environment of competitive academic selection. While Catholics are broadly associated with anti-British subversion and left-wing activism, what this group ultimately desires is the ability to pursue their own material interests without being hindered by any unnecessary roadblocks (shocking right). Legitimate concerns regarding discrimination etc have been replaced with the crushing ennui induced by perpetual teams calls and mediocre public sector wages. Give them the opportunity to circumvent this dead end and they'll seize it with the same alacrity evinced by the 'Irish competition wallahs' when the ICS introduced recruitment via competitive examination. Michael O'Dwyer went from advocating for Home Rule in Ireland to perpetrating the Amritsar massacre against its supporters in Punjab. Point being that animosity can quickly turn to loyalty when prosperity and advancement are made available to you.
Another point worth mentioning is the fact that the fundamental dichotomy in NI is not Catholic/Protestant or le working class/forces of capital (as republicans argue) but Belfast ones/Culchies. Despite being provincial by UK standards, Belfast ones are born with an intense aversion to provincialism. Even if you're from another large urban town or city in NI, if it's not an appendage of Belfast then you are a culchie. We are totally impervious to the incessant gurning about 'chronic underinvestment west of the Bann'. It is just tacitly accepted that you are supposed to gravitate to the urban capital where things are happening. In contrast, it seems to me that London/Edinburgh chauvinism is expected to be tempered with some level of embarrassment and guilt surrounding the fact that they're more privileged than their stunted little brothers (the North, Glasgow). The civic identities of the latter are informed by the belief that they're tougher and more #authentic (poorer, grimmer, less relevant) than the former.
That may seem tangential, but the point I'm making is that I'm sure both communities would be amenable to the prospect of relocation if it was actually encouraged and facilitated in some way instead of incentivizing them to remain wallowing in their unproductive torpor. Obviously there's a bit more to NI than post-industrial loyalist communities and the unfulfilled products of Catholic grammar schools, but I've chosen to discuss them given their significant numbers. Let's say there is a hypothetical exodus from Belfast to the South East. Your factories are now filled with fanatical patriots as opposed to workers from who knows where sending half their wages home in the form of remittances. Instead of halal butchers, now your lampposts are festooned with union jacks. I don't need to list off the benefits of absorbing the grammar school Catholics, especially if no effort is made to address the sheer lack of grammar schools (and rising private tuition fees) throughout the rest of the UK.
Despite the transformative potential that is always lurking in the periphery, NI is tiny and the influx of these desirables (if you will concede that they are desirable despite the fact that our only post-George Best contribution has been the CS Source mods inspired by our recent ethnoconfessional feud) will amount to a mere drop in the ocean. I am of the opinion that the people here are uniquely valuable (I am biased and perhaps delusional) and they have been stifled by the policies discussed in your article. I would also like to add that the North Antrim coast is the exception to the culchie rule in the sense that both its Catholic and Protestant elements perfectly exemplify the reasons behind not only Ulster but specifically Antrim exceptionalism. I was about to elaborate on this but it would be taking the piss.
Where do you think remote working will fit into all of this? Will it significantly reduce the need for professionals to move physically into London/the South East?
Yes, somewhat, though in my view WfH has negative productivity effects that are being hidden because 40-something middle managers hate going into the office. I think that a lot more economic growth depends on physical proximity, and preferably physical proximity that is regular and often informal or semi-formal, than people are willing to accept.
Moreover, even if it is now easier to earn a living in one of these dying towns than before, that doesn't make them any less depressing when it comes to their amenities (or lack thereof). It is also often difficult to find a partner of similar economic, educational, and social status. Even if they could get away with living miles away from London, I think many young people would choose to spend their early careers in the Southeast if they could afford it.
I think WfH is working a lot less well than people realise, the negative impacts are disguised because 1) a lot of the people tasked with making these decisions are benefitting from WfH, and so very receptive to positive stories, and
2) the effects are corrosive. New starts integrate more slowly, graduates learn more slowly, etc. There's no sudden drop-off, and nothing is ever monocausal, so people aren't sure.
Indeed. A third factor that I neglected to mention in my original comment was that we have been deluded by the fact that WfH was pioneered by software engineers and similar. The problem of monitoring here is very easy: you have a relatively motivated workforce who are producing relatively transparent output.
Remove one, let alone both, and you start to run into problems.
Yeah this fits a more general pattern that I've noticed anecdotally.
Many (most?) people do much less work when WfH, but highly motivated, productive people are able to do more.
And highly productive people are disproportionately influential in a business's decision-making. They answer fewer questions, get pulled into fewer discussions, and have the flexibility to pick up their kids from school or whatever - they're loving it. And in the short term, the businesses are fine too, because a lot is being done by those people.
But the workforce is mostly made up of people whose productivity depends a lot on their environment. And those people are losing out, because they're learning less. Eventually that effect will dwarf the small productivity gains from the productive people having more focus time, and that's not even getting into the hard-to-measure benefits of highly productive people having impromptu chats with one another at the office.
Haven’t historic regional fiscal transfers been more about supporting regions to keep their head above water rather than investment to enable them to grow their infrastructure and economies?
Also, you don’t mention the experience of other countries. Is there a contrary conclusion that could be drawn from looking at another country that has successfully invested in its regions’ infrastructure?
Regarding the first point, I don’t think this is really true of regional policy before 1979, given that it generally focused on subsidising investment, not increasing welfare spending (or similar).
Regarding the second, I have only a limited knowledge of other countries, but Germany (for instance) has had only very limited success at decreasing the gap between East and West Germany despite enormous spending.
More generally, modern economies seem to be increasingly concentrating on a small number of big cities — Britain and London is no longer such an outlier in this regard.
Great article. I've often thought that the British horror at how America lets cities die (like Detroit) is entirely misplaced, the rise and fall of towns and cities is completely natural. When a town only exists due to one specific industry from the 19th century, why must it be supported by the state to continue indefinitely? It makes no sense either economically or for the wellbeing of the residents.
As you touched on, I think Britain's reliance on mass immigration is tightly linked to the freezing of internal migration. The south east has swelled with people from abroad because they have not come from other regions of Britain.
Finally, I imagine another important reason the textile industry was not given state support was that its output was not need as a national security issue.
Another excellent article. It's quite ironic that one of the few examples where the British state successfully "ran down" an old industry was with the railways which, arguably, are one of the few that actually benefit greatly from centralisation and state support. It's certainly a "loss-leader" situation but the infrastructure benefit of a robust and widespread rail system is well known.
The Beeching Cuts may have been right to axe services and stations to areas which no longer needed it but the malaise of the industry in general has continued to hamper transport infrastructure in this country.
The UK is unusual among major economies in having its political, economic and cultural capitals in the same city. Fixing that would boost aggregate activity because private sector growth is inhibited in London by costs, labour availability and planning constraints, while much of the rest of the country subsists on formal and de facto transfers.
This article is beyond excellent; it is important.
Thank you for this genuinely insightful article. I feel that I understand the British economy a bit better. I’m reminded of the song Everyday is Like Sunday and the seaside town they forgot to shut down. It is sometimes more compassionate to put an end to moribund municipalities and ways of life.
I’m reminded of the Canadian regional development situation. Canada has eternally faced the problem of the underdevelopment of the Atlantic provinces, as well as certain regions in other provinces such as Northern Ontario.
The difference is that these were never plausible industrialization candidates, although significant funds were spent on futile efforts such as the Bricklin automobile. We also have pointless shipyards in Quebec and Atlantic Canada that seem unable to actually build ships.
We do get over investment in government to those regions, to the point that their government services are often better than in wealthier regions. But they are aging populations that are totally unviable without government support. At least these regions are relatively small in Canada and somewhat affordable, at least up to now.
We also see odd effects on immigration. For example, unviable community colleges in Northern Ontario were permitted to establish partnerships with sham private colleges in the Toronto area and essentially sell diplomas to Indian immigrants who wanted immigration status. We are now seeing horrible effects in housing and medical services, along with a flood of low wage, unproductive labour.
Great article - I noticed that NI was conspicuously absent despite being the biggest basket case of the lot. You have an intensely patriotic labour force in the form of the loyalist community who have been sat twiddling their thumbs since the decline of the shipyards. Cut their gibs and they'd be forced to migrate in order to make a tangible contribution to the country they venerate. Then you have a significant body of Catholics who have benefitted massively from our intact grammar school system (there are 67 grammar schools in NI and our population is under 2 million) and who have excelled in an environment of competitive academic selection. While Catholics are broadly associated with anti-British subversion and left-wing activism, what this group ultimately desires is the ability to pursue their own material interests without being hindered by any unnecessary roadblocks (shocking right). Legitimate concerns regarding discrimination etc have been replaced with the crushing ennui induced by perpetual teams calls and mediocre public sector wages. Give them the opportunity to circumvent this dead end and they'll seize it with the same alacrity evinced by the 'Irish competition wallahs' when the ICS introduced recruitment via competitive examination. Michael O'Dwyer went from advocating for Home Rule in Ireland to perpetrating the Amritsar massacre against its supporters in Punjab. Point being that animosity can quickly turn to loyalty when prosperity and advancement are made available to you.
Another point worth mentioning is the fact that the fundamental dichotomy in NI is not Catholic/Protestant or le working class/forces of capital (as republicans argue) but Belfast ones/Culchies. Despite being provincial by UK standards, Belfast ones are born with an intense aversion to provincialism. Even if you're from another large urban town or city in NI, if it's not an appendage of Belfast then you are a culchie. We are totally impervious to the incessant gurning about 'chronic underinvestment west of the Bann'. It is just tacitly accepted that you are supposed to gravitate to the urban capital where things are happening. In contrast, it seems to me that London/Edinburgh chauvinism is expected to be tempered with some level of embarrassment and guilt surrounding the fact that they're more privileged than their stunted little brothers (the North, Glasgow). The civic identities of the latter are informed by the belief that they're tougher and more #authentic (poorer, grimmer, less relevant) than the former.
That may seem tangential, but the point I'm making is that I'm sure both communities would be amenable to the prospect of relocation if it was actually encouraged and facilitated in some way instead of incentivizing them to remain wallowing in their unproductive torpor. Obviously there's a bit more to NI than post-industrial loyalist communities and the unfulfilled products of Catholic grammar schools, but I've chosen to discuss them given their significant numbers. Let's say there is a hypothetical exodus from Belfast to the South East. Your factories are now filled with fanatical patriots as opposed to workers from who knows where sending half their wages home in the form of remittances. Instead of halal butchers, now your lampposts are festooned with union jacks. I don't need to list off the benefits of absorbing the grammar school Catholics, especially if no effort is made to address the sheer lack of grammar schools (and rising private tuition fees) throughout the rest of the UK.
Despite the transformative potential that is always lurking in the periphery, NI is tiny and the influx of these desirables (if you will concede that they are desirable despite the fact that our only post-George Best contribution has been the CS Source mods inspired by our recent ethnoconfessional feud) will amount to a mere drop in the ocean. I am of the opinion that the people here are uniquely valuable (I am biased and perhaps delusional) and they have been stifled by the policies discussed in your article. I would also like to add that the North Antrim coast is the exception to the culchie rule in the sense that both its Catholic and Protestant elements perfectly exemplify the reasons behind not only Ulster but specifically Antrim exceptionalism. I was about to elaborate on this but it would be taking the piss.
Incredible analysis, really enjoyed reading this
Where do you think remote working will fit into all of this? Will it significantly reduce the need for professionals to move physically into London/the South East?
Yes, somewhat, though in my view WfH has negative productivity effects that are being hidden because 40-something middle managers hate going into the office. I think that a lot more economic growth depends on physical proximity, and preferably physical proximity that is regular and often informal or semi-formal, than people are willing to accept.
Moreover, even if it is now easier to earn a living in one of these dying towns than before, that doesn't make them any less depressing when it comes to their amenities (or lack thereof). It is also often difficult to find a partner of similar economic, educational, and social status. Even if they could get away with living miles away from London, I think many young people would choose to spend their early careers in the Southeast if they could afford it.
Yeah this is my sense of it too.
I think WfH is working a lot less well than people realise, the negative impacts are disguised because 1) a lot of the people tasked with making these decisions are benefitting from WfH, and so very receptive to positive stories, and
2) the effects are corrosive. New starts integrate more slowly, graduates learn more slowly, etc. There's no sudden drop-off, and nothing is ever monocausal, so people aren't sure.
Indeed. A third factor that I neglected to mention in my original comment was that we have been deluded by the fact that WfH was pioneered by software engineers and similar. The problem of monitoring here is very easy: you have a relatively motivated workforce who are producing relatively transparent output.
Remove one, let alone both, and you start to run into problems.
Yeah this fits a more general pattern that I've noticed anecdotally.
Many (most?) people do much less work when WfH, but highly motivated, productive people are able to do more.
And highly productive people are disproportionately influential in a business's decision-making. They answer fewer questions, get pulled into fewer discussions, and have the flexibility to pick up their kids from school or whatever - they're loving it. And in the short term, the businesses are fine too, because a lot is being done by those people.
But the workforce is mostly made up of people whose productivity depends a lot on their environment. And those people are losing out, because they're learning less. Eventually that effect will dwarf the small productivity gains from the productive people having more focus time, and that's not even getting into the hard-to-measure benefits of highly productive people having impromptu chats with one another at the office.
Haven’t historic regional fiscal transfers been more about supporting regions to keep their head above water rather than investment to enable them to grow their infrastructure and economies?
Also, you don’t mention the experience of other countries. Is there a contrary conclusion that could be drawn from looking at another country that has successfully invested in its regions’ infrastructure?
Regarding the first point, I don’t think this is really true of regional policy before 1979, given that it generally focused on subsidising investment, not increasing welfare spending (or similar).
Regarding the second, I have only a limited knowledge of other countries, but Germany (for instance) has had only very limited success at decreasing the gap between East and West Germany despite enormous spending.
More generally, modern economies seem to be increasingly concentrating on a small number of big cities — Britain and London is no longer such an outlier in this regard.