The great policy gap: local economics

There is a bizarre moment in the half-forgotten Lindsay Anderson film Britannia Hospital, where the Queen arrives to open the new hospital wing wheeled in on a trolley, to avoid the demonstrators outside.

I was reminded of this going to hear Nick Clegg’s speech on the economy at the LSE, where the security was so tight and labyrinthine that only the demonstrators knew where he was actually speaking.

Nick could be heard in his microphone, as he was being slipped in through the back door, asking: “Has the lecture theatre been booked?”

It was a good speech, well-delivered, and what he said was important – infrastructure, green investment, devolving money-raising powers (though I’m not sure that transport infrastructure inevitably brings growth, since it is likely to undermine local business as much as it opens opportunities for more distant business).

But there was nothing in the speech about those elements that might actually have some chance of reviving the struggling economies of many of our cities – enterprise, small business, local lending.

This reflects the gap in Treasury thinking and it is a serious problem. The establishment has no idea how to revive local economies, and increasing money flows there, and local government looks hopelessly and pathetically to the Treasury to do it for them.

The problem is that, although infrastructure projects and trade negotiations may help in the long term, we all know they will have little or no impact when and where it is needed.

Lib Dems have had so little to say on economics since the death of Keynes in 1947, and now it really matters. Time we got our act together.