Tuesday 3 February 2015

Lefties, protectionism and people-powered prosperity

"The problem with David Boyle and his sort is that they're too buried in their bien pensant leftiness to realise that the best and strongest argument for localism is actually a conservative argument..."

Bien pensant lefty?  Moi?

It is a step towards the kind of debate we wanted to create with my new book People Powered Prosperity, that Conservative councillor Simon Cooke, a thinking blogger, has produced a thoughtful response.  But I can see - never having met each other - that he doesn't understand where I'm coming from.

Let me step back a moment.  People Powered Prosperity began as a project, funded by the Friends Provident Foundation, to translate economic localism and resilience into terms that the Treasury might understand - and vice versa.  We had found, after a dialogue begun with the Chief Secretary to the Treasury that, once we talked to Treasury officials, there was a definite translation job to be done.

We set out, not to propose policy solutions, but to try and explain why the various sides found it so difficult to understand each other.

I have always felt, and feel now, that the arguments for localism are largely liberal, but there are good conservative ones too, for the reasons Chris sets out.  A more robust local economy, with independent businesses, is more resilient, more human, and it stays the same - all good conservative arguments.

I'm not sure if Chris was advocating the kind of big scale combination that he was caricaturing.  I think he was saying it was the logical extension of green thinking.  I don't think he is right about this.  I think most bigger scale factories, units or organsiations are big because of muddled thinking about economies of scale.  It is about hiding the externalities more effectively, rather than including them.

Most big organsiations, companies and units I know are more wasteful, less efficient, less human and less effective than smaller ones - but of course there are exceptions to this.

But where Simon Cooke gets it wrong, it seems to me, is that there are no other economic arguments for networks of small businesses than a warm conservative feeling inside.  These are mine:

1.  They keep money circulating locally for longer, so - with the same amount of money coming into the local economy - they produce more wealth.

2.  They often pay better and provide more flexible employment.

3.  Twenty small businesses is more resilient, more likely to get through a global downturn, than one factory on the outskirts.

4.  They provide economic independence, imagination and innovation in a way that big companies can't.

That is not bien pensant leftiness.  As Simon says, it looks a good deal more like conservatism, with a dose of old-fashioned free market Liberalism.  Because big business without small business challenging from below is just monopoly by another name.  It is the very opposite of the free market.

So I don't accept that economic localism is about protectionism.  It can be, of course.  But not the kind we are advocating.  It is about making sure the economy is more interdependent, more competitive, more diverse, more challenging, more downright exciting then when you have a few unchallenged, unchallengable monoliths to deal with.

Still, how about you make up your own minds?  People Powered Prosperity, by David Boyle and Tony Greenham, is published by the New Weather Institute. http://www.newweather.org/projects/towards-a-people-powered-prosperity/

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