It’s that time of year, again, when the clocks change in the UK and we gain an extra hour of sleep and Kepstorn gains another year in age.
27th October, 2007 – it seems like a lifetime ago and any attempt to relate the current position to the world as it was, back then, now risks sounding like a history lesson, rather than a chatty update!
Seventeen years really is a generation, however. People born at the time that I started the business are now taking driving lessons, some are parents but none voted in the General Election in July; what is now being seen as the most consequential transfer of power in the UK since the end of the last century.
The Budget to be unveiled on Wednesday is the rather (very!) belated and long-drawn-out denouement of the current political cycle. Whoever thought that it was a good idea waiting for almost four months before letting the other shoe drop must be regretting their decision. The briefing, leaking and trailing of information as well as the simple misinformation has had a chilling effect on the economy and on the initial upbeat and largely positive reaction to what was seen as an inevitable and largely necessary clearing of the decks.
It is, however, only the start of what has to be a national renewal; a change of approach and attitude to meet the obvious current challenges and the inevitable unknown challenges that will present themselves over the next few years. An increasingly short-termism approach had infected political and economic thinking ever since the credit crunch. In a way, it was, in part, understandable. When you have a once-in-a-century economic event, followed a few years later by a once-in-a-century (or more) health crisis, the need to deal with the immediate issue and then, thereafter, the realisation that there was no “normal” to return to probably accentuated the ad hoc nature of decision making. That now has to end.
Is five years enough to achieve this change? I don’t think that anyone believes that it is. Will the current Government have the political will to spend five years dolling out the medicine in the hope that the electorate give them another five years to finish the job? I suspect not, but it is in the country’s interest that they do so.
It has to be remembered that the last time that there was a fundamental economic and cultural shift in the UK, the Government of the day was only allowed to complete the job as a result of a bunch of military dictators invading the Falklands, stirring up such a patriotic fervour that there was no willingness to change the Government. There are, of course, dictators at large in the world, today. They, however, are a great deal more dangerous and well-armed than the junta in Argentina. Let’s hope that it is not them that we need to rely upon for the current Government to see through its agenda!
This is another reason why there has to be a sea change in the political, cultural and economic outlook in the UK. The years of relative economic plenty and a largely benign geopolitical climate are well-and-truly over. The UK needs to prepare for stormy times ahead.
That, of course, leads me to the bigger fiscal, political and cultural event on the very near horizon – next week the people of the United States go to the polls. For those of us in the UK who have been part of the discussion on the pros and cons of the “first past the post system”, it is worth reflecting on the fact that the future of the United States and, as a result, the future of the global economy (and much else) may come down to a few tens of thousands of votes in seven states, when the voting population is approximately 170 million and there are fifty states!
It is hard, sometimes, to focus on the micro decisions, which can affect the individual who makes those decisions, when the macro decisions are so unpredictable.
The micro situation is, however, all that we can have any real hope of influencing and so I am happy to say that the slight delay in penning this anniversary note is as a result of the amount of work that is keeping me and my colleagues exceptionally busy. Some things, it seems, don’t change, even after seventeen years!
