Going South is a very readable book that will appeal to anyone interested in Britain’s poor historical economic performance. But be warned: the authors are much better at documenting decline than coming up with ideas to reverse it.
The book is based on the premise, suggested by its subtitle, that Britain will be a third world economy by 2014. Larry Elliott and Dan Atkinson justify this claim by dismissing accepted definitions of what makes an economy developed and setting out instead a list of features of what they call a ‘de-developing economy’. These range from the search for charismatic political leadership to the growth of a ‘trust economy’. Britain, they argue, fits the pattern perfectly. True, but so do many other economies normally thought of as developed, including the United States.
This attempt to recategorise Britain is an unnecessary gimmick because – as the book makes clear – there is a wealth of evidence to show Britain has been in relative decline for the last century and is now ‘a country deep in crisis’. The authors marshal this evidence to great effect, detailing developments in the economy, politics and culture with great aplomb for the most part. It is disappointing, though, that they fall for the ‘lump of labour fallacy’, arguing that large-scale immigration has been ‘considerably in excess of the economy’s medium-term needs’.
They are, however, right when they say the biggest failure over the last century has been investing less as a share of GDP than comparable economies. They are also right to highlight how a narrow industrial focus has contributed to it being more than a quarter of a century since the UK last had a surplus on the current account of the balance of payments.
The authors believe, correctly, that solutions cannot be imported wholesale from other countries and they argue instead for a British model that learns from overseas experience. The reader is not left, though, with a clear idea of what this might look like, other than that it should involve a better education system and an active industrial strategy – hardly novel suggestions.
Its wide-ranging analysis of Britain’s decline makes this book an important, if depressing, read. Nevertheless, one is left with the feeling that a book that argues that action is required soon to halt Britain’s relative economic decline really ought to have more to say about how this might be achieved.
Tony Dolphin is senior economist and associate director for economic policy at IPPR
Going South: Why Britain Will Have a Third World Economy by 2014
Larry Elliott and Dan Atkinson
Palgrave Macmillan | 400pp | £14.99
economy, financial crisis, third world