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Thursday, May 26, 2005


Mine was the lead letter in the Scotsman on Wednesday
The Allander Institute has done a considerable service to Scotland, and Professor Brian Ashcroft and his associates have made a number of interesting points (Opinion, 23 May).

However, they say that compared to poorer countries like Ireland, South Korea and China, we are bound to lose out because they are playing "catch up" with us. History shows the opposite. On balance, the fastest growing economies have been the richest and the average rate of world growth is increasing as it gets wealthier.

China may appear to contradict this, but its growth has been concentrated in the wealthier coastal provinces while the poorer hinterland relatively stagnates. South Korea already has 60 per cent of our incomes. Ireland is not playing "catch up", as it passed us a few years ago.

Also, too many of the proposed solutions, such as "skills training for the under-fives" and "achieving coherent planning" are top down and, while well-intentioned, could easily increase government spending. We spend 54 per cent of our money on government, which, even if it were not inefficient, produces no tangible goods. We must cut such spending.

The template for growth has been provided by Ireland - cutting planning restrictions, regulations, and business taxes unleashed an entrepreneurial spirit in a country which had little history of it and produced 7 per cent growth. Scotland could do even better.

On the same day Jim Mather, SNP enterprise spokesman, had an article, also on Professor Ashcroft's previous article, putting very much the same points.
However, while it can help Scotland do better, it does not offer a credible means to transform the country or its poor record of economic growth.

In other words, if the Jim Wallace/ Jack McConnell strategy was to copy Mikhail Gorbachev and simply tinker with the existing constitutional model, this book recommends enhanced "Gorbachev". But it is still not enough. All of those involved should talk to the Compaq and British Airways executives who did too little too late in response to Dell and EasyJet and look at how radical the Irish and others have been in transforming their nations.
There are still those who argue that there is no job to do, that Scotland is doing fine; those people include Adair Turner, who bizarrely proposes that Scotland should simply accept relatively poorer economic performance.

Well, that won't wash. The data proves there is a real and compelling need for radical change. Any analysis of that data proves that Scotland's persistently low level of economic growth is the core problem. It's no surprise, then, that a consistent majority of people are in favour of more power for the parliament. They know that fine tuning a failed economic model will not do and that we must tilt the currently un-level playing field in Scotland's favour.

That is why, at the general election, the SNP proposed reducing corporation tax, business rates and water charges to trigger higher levels of economic growth, in an attempt to converge with the higher living standards enjoyed elsewhere.

Such action would be all the more justified when we see Scotland falling from 21st to 22nd in the 2005 IMD table of 30 smaller countries, with the Czech Republic and Hungary rapidly closing on us.

Even more remarkably, if I am reading this right, he is offering SNP support for the next Enterprise Minister, should he be seriously committed to growth, rather than platitudes, as has previously been done. If so then this would indicate a considerable step forward in political maturity in the SNP & an example of the cross party consensus by which Holyrood (& traditionally any Parliament) was supposed to work & Westminster never does.
In the meantime, there is the issue of finding a new minister of enterprise and lifelong learning. Frankly, it is not an attractive job, as, without powers, it simply cannot be done and cannot counter the gravitational pull of London and the south-east of England.

However, there must be hope that, eventually, an enterprise minister will clamor to change the remit and change Scotland for the better.

That would need someone who is obsessed about Scottish competitiveness, aware of Scotland's many positive attributes and able to sell Scotland to anyone. That person would also be straight-talking, intolerant of claptrap and catchphrases unless they were coupled with real powers, and with an ability to help Scottish business lower costs, boost quality and add real customer-audited value.

In short, we need a new enterprise minister who is willing to confront his colleagues and be fired in order to be in a position to engage the people of Scotland and help produce a genuine national recovery. Otherwise, the next incumbent will prove that, in the mouth of the Executive, "top priority" is a euphemism for "badge of shame" or "embarrassment".

And Scotland urgently deserves better. It is time for pragmatism and an enterprise minister who will get his or her name in the history books.
This is also good tactics on the SNP's part, since, if they are aiming at forming the government next time they are aiming at building contacts with the Lib Dems & supporting a radical Lib Dem Enterprise Minister would do so. Since the Lib Dems are also restive under Labour they would be very well advised to accept such olive branches. At the very least it opens their partner options from 1 to 2.

I have earlier expressed my approval of Ross Finnie's competence, actuarial experience & willingness to take tough decisions (aiming fishing subsidies at cutting the fishing fleet rather than merely open ended subsidy, which annoyed the SNP but was right).

The other letter is from Glasgow Lib Dem Cllr Naill Walker in support of nuclear power. Naill is a genuine environmentalist. He is involved in cleaning up the Kelvin, in an entirely hands on manner. As such he is could clearly be expected to oppose nuclear as part of the general package deal on environmentalist positions. However he is intelligent, able to count (another accountant) & has the intellectual honesty to recognise the black hole we are diving into & the political bravery to openly say so (he also said something similar at this spring's conference).
Those attacking nuclear energy on its safety record should ponder this. How many thousands of coal miners have died in accidents or had their health ruined? Many people have also died in oil exploration accidents such as Piper Alpha. They say nuclear power is expensive, but what about the huge hidden costs of fossil fuels? The costs of climate change are unimaginable.

There are problems involved in disposing of radioactive waste, but progress is being made. It would be preferable if renewable energy could provide our needs, but our demand for energy is increasing and we need nuclear power to fill the gap.

It's not that China and other countries are playing catch up to 'outperform' the western world. But its justt the magnitude and rate of growth that's ominous. Even if China has a per capita of 1/4th of US, but with 5 times the population of US, its spending power is more... and would be at the helm of world affairs... oil etc... even if many are poor inside. That sure is a reason for concern.
Per capita China is a lot poorer than that but you are right about them catching up- see 17th November
But if they outrace us it will be because they ran & we didn't - they will then deserve the prize - this site is devoted to getting us to run not to crippling the opposition.
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