According to the think-tank IPPR, a third of the UK’s annual pay and 44% of jobs are under threat from automation. This translates to £290 billion and 13.7 million jobs, with low paid jobs most at risk.

The impact of automation will also be unevenly spread geographically. The Centre for Cities estimates that workers in the north of England and the Midlands are most at risk, while northern towns including Sunderland, Stoke and Mansfield could see nearly 30% of jobs automated in the next 12 years. In contrast, cities such as Cambridge and Oxford may only see 13% of jobs automated.

Another report by PwC suggests that 30% of jobs could be under threat from artificial intelligence within 15 years. Unskilled jobs may be lost to robots, while skilled jobs could be lost to AI and algorithms. Some locations and sectors will fare better than others. In Shadow chancellor John McDonnell’s constituency of Hayes and Harlington – which contains Heathrow Airport – 40% of jobs are estimated to be at risk.

Despite the challenging road ahead, automating roles with robotics and artificial intelligence will present us with vast opportunities if we can seize them: from closing the productivity gap to ridding ourselves of backbreaking work and greatly improving our quality of life. A million people currently make their living from driving in the UK, yet driverless vehicles could make our roads much safer.

But if mass unemployment is mismanaged through a lack of planning by government and a lack of awareness among the public, it could add fuel to populist movements. The impact of automation on democracy has been a blind spot in the debate thus far. If we are to ensure democracy thrives in the information and network age then we must start planning now.

It is not difficult to imagine a future government indulging the temptation to deregulate the labour market in a desperate and futile bid to keep humans competitive with robots. Whilst this might keep employment artificially high, those hit by chronic unemployment, incredibly low pay and the indignity of working in a job they realise is utterly absurd will ultimately drive people to the edge, provoking populism and extremism. This effect will be amplified further if the narrative of “strivers versus shirkers” continues to be exploited.

Our careers and our pay brackets position us within society, our political engagement, and even the way we vote is influenced by our economic value. People may engage less in elections when unemployment rises. As automation increases, we may see political instability as elections become less predictable. For many, active democratic participation comes from collective bargaining at work via trade unions, associated party memberships and industrial action. A loss of unionised work would close these channels of democratic participation.

Not everyone believes that mass automation will lead to mass unemployment. At the launch of the Future of Work Commission the co-chair and Labour MP Tom Watson insisted we should not fear the “march of the robots” who will set us free to pursue more rewarding and skilled work. Watson echoed the chancellor Philip Hammond, who weeks earlier got into trouble on the Andrew Marr Show when he dismissed the threat of driverless vehicles to the 1 million people who make their living from driving:

“I remember 20 years ago we were worried about what would happen to a million shorthand typists in Britain as the personal computer took over. Nobody has a shorthand typist these days. Where are all these unemployed people? There are no unemployed people. We have created 3.5 million jobs since 2010.”

Later on, the chancellor used his appearance on Peston on Sunday to clarify his message:

“But the point I was making to your former colleague Andrew Marr is that previous waves of technological change have not resulted in millions of people being long-term unemployed. They have been reabsorbed into the workforce.”

While it’s true that previous mechanisations created more rewarding and better paying jobs, the staggering advances in AI and robotics could spell the end of this trend. It is the difference between the original introduction of the combine harvester and an imaginary (for now) introduction of a combine harvester built by Tesla. This combine harvester is driverless; works day and night including over weekends and lunch; can sort, package, distribute, clean and self-repair; and use the data it collects on the job to design a more efficient harvesting programme. It might make food cheaper, but where do people fit in?

In the last century, deindustrialisation and mass job losses preceded the growth of the finance sector in the UK, which now employs 7.3% of Britain’s working population. But these roles are especially vulnerable to automation and many future job losses are predicted to come from this sector. A shrinking state, the potential loss of tax receipts and loss of middle class roles would make it difficult for the public sector to absorb people back in to work as it did in the past. A funding crisis in higher education could make retraining an expensive gamble.

Despite the obvious upheaval that automation will create, the term ‘Artificial Intelligence’ was mentioned in Parliament only 19 times between 2010 and 2016. A Future Advocacy report showed that only 7% of the general public are worried about their jobs being displaced by robotics and AI, despite increasing evidence of the gathering storm.

The authors of the IPPR report list ways to ensure that we all benefit from increasing automation, as well as mitigate some of the potential pitfalls which threaten to entrench increasing inequality. These include profit sharing for businesses above a certain size, expansion of employee ownership trusts and a new sovereign wealth fund for investing in the new companies that will flourish with automation. Other ideas include a robot tax.

Our expectation of ever-increasing economic prosperity makes kicking the can down the road a tempting prospect. But we are only three parliamentary terms away from 40% of jobs being automated in some constituencies. Rising living standards and economic prosperity have lent our democracy legitimacy — we must ensure these are not allowed to fall as a result of mismanaged automation.

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In the light of Brexit, can a new coalition of social class and territorial interests mobilise to deliver a meaningful industrial strategy?

This week, the government published its Industrial Strategy. It is a hefty document, weighing in at 255 pages, and clearly the product of many months of analytical and policy development work. Like most such papers, it is littered with the mini-reviews, micro initiatives and small spending pots that characterize cross-departmental policy documents. The prose is occasionally tortured by the Whitehall compromises it embodies. But it has a thematic coherence, drawn from a focus on tackling the UK’s productivity problem and proposals to orient economic activity strategically towards four “Grand Challenges” of an ageing society, the transition to a low carbon economy, mobility, and AI and the data economy. This focus on societal missions, some big increases in R & D spending, and the recognition that governments have a strategic role in shaping economic growth have pleased advocates for industrial strategy. It has been broadly welcomed.

The government’s white paper follows hard on the heels of two important contributions to industrial strategy policy, the first from the Commission on Industrial Strategy, established by the Universities of Manchester and Sheffield and chaired by Dame Kate Barker whose final report was published a few weeks ago, and the second, a discussion paper from the Institute for Public Policy Research (IPPR) Commission on Economic Justice.

Each of these sets out, in different ways, the persistent weaknesses in the British economy that justify a strongly articulated, non-partisan and consistently delivered industrial strategy: poor productivity performance, low rates of business investment, regional imbalances, chronically weak export performance, and poor diffusion of skills, R&D and innovation. These are familiar and largely indisputable lists.

Barker’s Commission on Industrial Strategy refrains from describing these weaknesses as symptoms of a deeper neo-liberal malaise or characteristics of a fundamentally broken British economic model; it positioned its report to appeal to policymakers across the political spectrum and its analytical framework reflects that.

In contrast, the IPPR contribution is directly addressed to the construction of a new economic model. It believes that the UK’s economy is governed by a neo-liberal intellectual paradigm that has manifestly failed and is on its way out, in academia as much as the institutions of economic policymaking. It adduces the government’s new industrial strategy as further evidence of the paradigmatic transformation in economic thinking that is underway.

Universal Basic Infrastructure

Like the government’s white paper, both of these contributions address policy frameworks and instruments that typically fall within the ambit of industrial strategy: infrastructure investment, innovation and R & D, skills, and regions (or “place” in the government’s parlance). Perhaps the most eye-catching feature of the Manchester and Sheffield report – doubtless a consequence of Diane Coyle’s membership of the commission – is the call for the state to ensure that a Universal Basic Infrastructure is provided in every area as a social minimum offered to all citizens. In broad terms, this infrastructure would be “hard” (rail, bus, broadband) and “soft” (schools, health and care services). The proposal deliberately echoes but subverts the idea of a Universal Basic Income, which has attracted significant political attention in recent years. Infrastructure is more important than income, the report argues, in promoting the capabilities of citizens for economic development while regionally-balanced investment in infrastructure would do more to address exclusion from centres of economic agglomeration and growth than income transfers.

The UBI proposal overlaps with recent calls for Universal Basic Services, another intellectual and political route into debates about securing inclusive citizenship in unequal, open economies like the UK’s. It has some congruence too with the argument for promoting the growth of the “foundational” or “everyday” economy that has been developed in recent years by the Centre for Research on Socio-Cultural Change at the University of Manchester. Here the anchor institutions of the local state – local government, the NHS and so on – are used to underpin sustainable demand in the local economy by paying living wages and using public procurement to keep income circulating locally, in strategic partnership with non-tradeable sectors like retail, hospitality and catering. A Corbynite version of this approach has been pioneered, with some apparent success, in Preston, where procurement budgets have been used to buy locally provided services and farmed food, and where cooperatives and other forms of worker control are being encouraged.

What about the millions in low waged sectors?

It is noticeable, however, that the commission’s report says relatively little (aside from the significant health and social care sector) about the low-skilled, low-wage sectors in which millions of British people work. This is also a major lacunae of the government’s Industrial Strategy, which focuses almost exclusively on high value-added sectors. This oversight is not accidental: political economists argue that all governments have an interest in meeting the needs of high value-added businesses, but it takes particular kinds of political coalition to ensure that the needs of low- and semi-skilled workers are addressed. Whereas in Fordist economies the interests of these workers could be aligned with those of skilled workers, in post-industrial service economies these working class coalitions have broken down, often leaving the low-skilled without allies. This is particularly true of majoritarian political systems that have co-evolved with liberal market economies, in which high-skill, professional employment in services has grown alongside low-wage, low-skilled work in the non-tradeable sectors.

To its credit, the IPPR discussion paper pays much more attention to these low skill sectors, where it empirically locates the bulk of the UK’s productivity problems. Importantly, it advocates a new focus on skills utilisation, rather than familiar invocations to improve skills supply. There is considerable evidence that UK employers do not appropriately utilise the skills of their employees and do not integrate skills into the design of job roles and business capital investment strategies. In a flexible labour market with high employment rates, employers have less incentive to invest in skills training, and weak trade unions and limited coordination between firms ensure that vocational skills development and utilisation are historically under-developed in the UK, in common with other liberal market economies.

Pet schemes – or Nordic vision and lifelong learning?

In this policy area, the government’s industrial strategy is noticeably weak. It claims to overhaul technical and vocational education in terms that are wearingly familiar from official policy documents of the last forty years (and even further back). But it amounts to little more than the usual policy mélange of small funding pots for pet schemes and the reorganisation of qualifications. This is a mark of how limited Whitehall’s understanding of the political economic and institutionalist determinants of employment training in the UK remains.

In the Nordic countries, the persistence of coordinated economic management, large public-sector employment and PR electoral systems has ensured that the interests of low-skilled workers have been represented in governing coalitions (although in recent years, the rise of anti-immigrant parties has fractured social democratic political strength). Liberalisation in the labour market has been accompanied by significant rights to skills training and flexible working, and increased public and business investment in lifelong learning (see in particular, Kathy Thelen’s work on reforms in the Netherlands and Denmark in Varieties of Liberalisation and the New Politics of Social Solidarity). In contrast, in parts of continental Europe, dualism in the labour market has led to a weakening of social protection and employment regulation for lower-skilled workers in the domestic economy, while the core social bloc of the export sector interests remains politically predominant, symbolised in grand coalitions (although this is under stress, as the recent German election showed). Yet here too, skills investment and high productivity in the manufacturing and higher valued added service sectors ensures that low unemployment is combined with significantly higher per capita GDP than in the UK.

A coalition of workers’ interests?

These considerations raise important questions for advocates of industrial strategy in the UK: who will be the political agents of economic transformation, and how can broadly based coalitions that unite the interests of low- and semi-skilled workers with those of middle-class professionals be created? The decline of the industrial working class, the rise of finance and decline of the UK “national” business class in core sectors, the spread of the gig economy and the parallel growth of higher education as a social insurance policy for the middle classes, coupled with the electoral dominance of a socially conservative older population, have all made the task of constructing progressive economic reform coalitions much harder.

In piecemeal fashion, the spread of devolution may provide new openings. It is noteworthy that Wales and Scotland have PR electoral systems and strong traditions of social solidarity, and each is pursuing prototypical industrial strategies with the (still limited) tools at their disposal. And on the same day as the Commission on Industrial Strategy published its report, England’s seven metro-mayors met together for the first time to advocate for increased devolution of skills and fiscal policy. In the more complicated multi-level governance of the UK, new political coalitions could emerge.

But these developments are unlikely to generate national economic transformation of the kind envisaged by industrial strategy advocates. Brexit may yet provide the critical juncture through which a coalition for political economic change can be formed, though the task is a monumental one and Brexit hangs over the government’s industrial strategy like a dark cloud, without any silver linings. In 20^th century, transformative change was driven by the exigencies of depression, war or the exhaustion of growth models, and it was typically state-led. In the 21^st century, Brexit and the painful realisation of relative economic decline may provoke the kind of rethinking that has hitherto eluded Britain’s political-economic elites. The question is whether a new coalition of social class and territorial interests in the UK can mobilise to underpin the necessary changes. For industrial strategy advocates, the politics ought to matter as much as the policies.

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The arguments for mission-oriented industrial strategy in general, and the focus on a zero carbon mission in particular, have been well made. Historical examples – the moon landings provide the usual case – prove that it matters who is driving innovation and for what purpose. Public policy can steer the path of socioeconomic development toward solutions to the greatest problems we face, contrary to the prevailing narrative that the private sector is the only engine of innovation. Missions put outcomes first, giving socioeconomic development a more clearly defined purpose. The unprecedented threat of climate change requires global net zero decarbonisation, as recognised by the 2015 Paris Agreement, making it a prime candidate for the first national mission for the UK.

So how would a mission-oriented industrial strategy be delivered? This is a question that we at IPPR are currently grappling with, in a project linked to our Commission on Economic Justice, which is developing a new approach to economic policy.

Over the last thirty years, the orthodox approach to economic policy has precluded government intervention beyond two broad approaches:

1. ‘Horizontal’ policies that attempt to improve the general conditions for private sector investment in general through, for example, the promotion of workforce skills and the building of infrastructure
2. ‘Vertical’ policies that target interventions on particular sectors or technologies, such as support for the automotive industry or biotechnology.

As the BEIS select committee has shown, the government’s Green Paper on Industrial Strategy  proposes a primary focus on horizontal policies, with some vertical interventions in order to support energy innovation and “cultivate world-leading sectors”. This approach is inadequate.

Horizontal policies focussing on the supply side of the economy do not directly promote demand and therefore are better viewed as traditional economic policy. Industrial strategy requires an explicit focus on stimulating demand as well as improving the conditions in which firms invest. The decarbonisation of the economy cannot happen without this, particularly at a time when the British economy is suffering from a fundamental lack of demand. Thankfully, macroeconomic conditions are highly favourable for an increase in public investment, with interest rates at historic lows, increasing the value to growth. What’s more, arguments against debt-financed investment lack force when considering the need for spending now to protect generations in the future and the large returns that could result from a greener, more efficient economy.

On the other side of the government’s approach, current vertical policies do little to recognise that value chains cut across sectors. Important goods and service often don’t easily adhere to a sectoral category, as is the case with the government’s decision to define ultra-low emission vehicles – a key element in the decarbonisation of transport – as a ‘sector’ when it is simply a product. Choosing particular sectors also increases the chance of ‘policy capture’ by incumbent companies, and the promotion of policies that benefit certain firms or sectors to the detriment of others and the wider public interest.

This is where the mission-oriented approach comes in. Industrial strategy should direct investments and firms so that the economy and society develop the means by which to decarbonise. A mission to decarbonise focuses on outcomes, overcoming the narrow focus of vertical policies, incorporating the system-wide view needed to scale rapid change across the economy. A good example is the transport system. A more digital, shared transport system requires investment and policy co-ordination from local authorities, app developers, car club operators, charities and energy companies, as well as the Department for Transport and vehicle manufacturers.

In setting an objective to be delivered by the economy, government can signal the path of future demand, improving confidence for private sector investment. Much of this is already provided by the 2008 Climate Change Act, which requires governments to produce emissions reductions plans every five years, consistent with an 80 per cent reduction on 1990 levels by 2050. This gives firms a clear signal of the direction of economic development. Climate Action Tracker currently rates the EU’s nationally determined contribution (NDC) – the commitment made on behalf of all 28 members – as having “medium” ambition, meaning more work is still to be done. A net zero decarbonisation mission, particularly in the context of Brexit, would cement the UK’s role as a leader on acting on climate change. The Climate Change Act would need to be amended to enshrine the new target in law, something to which the previous government signalled its commitment in March 2016.

Public investment should then direct demand towards goods and services that accelerate the transition to a net zero carbon economy, going beyond the usual horizontal approach. This should include helping British businesses maximise their potential to provide these goods and services. Such an approach was taken to actively attract offshore turbine manufacturing and assembly firms to the UK in the years following the passage of the Climate Change Act. Industrial strategy should then seek to co-invest with the private sector to increase the total level of investment in the economy and ensure that the public sector benefits financially from its investments as well as shouldering the risk.

A mission-oriented approach of this kind would put the problems we face up front and centre in our political and economic narratives. Crucially, it would provide us with the means by which to better develop the solutions. Beyond decarbonisation, other missions could focus on some of the other major socioeconomic challenges facing Britain – from demographic change to adapting to automation and other major technological changes. A mission-oriented approach can be adopted in response to these and capitalise upon positive synergies between them, such as increasing resource efficiency in industry through digitalisation.

In all this, the narrative point is key. It is through stories that we enliven economic concepts and animate the engagement of industry and the population at large. Fifty-five years have passed since John F Kennedy promised his nation that humanity would go to the moon, that it would be done within the decade, that it would be achieved through the combined effort of the American people, and at a price less than that paid for cigarettes and cigars. This story and its eventual success remain imprinted on our collective imagination. Kennedy sought to land on the moon both because it was there and because it would establish American supremacy over the Soviet Union. We must decarbonise our economy to ensure the sustainability of our society. What other mission is more important and more captivating of the imagination? It is time to bring focus and ambition back to our economic story.

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“The important thing for Government is not to do things which individuals are doing already, and to do them a little better or a little worse; but to do those things which at present are not done at all”

— John Maynard Keynes

On 20 July 1969 Neil Armstrong and Buzz Aldrin set foot on the moon. 48 years later, the lunar landing remains one of humanity’s greatest achievements. But the “giant leap for mankind” wasn’t merely a symbolic event – it had major repercussions for life back on earth.

When John F. Kennedy announced the goal of sending an American to the Moon in 1961, he kick-started a frenzy of innovation across the US economy. NASA’s pioneering work led to major technological advances in areas such electronics and computing, which generated spillovers across the economy. Without the research and development that went into the moon landings many of today’s top tech companies may not have been founded, and the world would likely be a very different place.

The moon landing is a successful example of ‘mission-orientated’ policy. Rather than focusing on particular sectors – as in traditional industrial policy – mission-oriented policy focuses on overcoming a specific societal challenge. It involves strategic thinking about the direction we want to move towards, and the kind of institutions and technologies we need to get there.

The importance of mission-orientated policy lies in the fact that innovation has both a rate and a direction. The direction can be left to the invisible hand of the market, or it can be actively steered by policymakers to shape new futures. Had the US government not set the goal of putting a man on the moon, the technology that took us there would likely never have been developed, and certainly not within the same time frame. Guided by the logic of profit maximisation, there was no incentive for the private sector to take up the task. The resources required, and the risks involved, were simply too great.

Economists typically hail private enterprise as the engine of innovation. But when it comes to the major technological breakthroughs of the past century, the reality is that most of the heavy lifting has been done by the state. As Mariana Mazzucato has highlighted, many of humanity’s boldest advances – from the internet and microchips to biotechnology and nanotechnology – were only made possible by early stage public sector investment. In each of these areas the private sector only entered much later, piggybacking on the technological advances made possible by long-term, high-risk public investment.

But for decades policy in Britain has been guided by an assumption that the market knows best. Not only has this resulted in a weak and unbalanced economy, but attempts at innovation have often focused on finding ever more sophisticated ways to extract value — not create it. While in the late 1960s the world’s brightest minds were inspired to work in space exploration, by the 2000s many had been seduced into the world of financial wizardry. A huge amount of brainpower was devoted to cooking up incredibly complex and “socially useless” financial instruments. These inventions – though undeniably innovative – fuelled a global financial crisis, and ultimately ended up destroying more value than they ever created. The “innovators” reaped huge rewards, while the taxpayer was left to pick up the tab. The lesson here is that the direction of innovation matters, and so we should steer our resources – both human and financial – towards activities that help solve real societal problems.

Today we face many challenges, but perhaps none are more urgent than climate change. The age of fossil fuels and mass production has generated an unprecedented amount of wealth, but rising levels of carbon dioxide in the atmosphere has led to a warming planet. If we allow the average temperature to rise over 2˚C above the pre-industrial level, then the result will be devastating and irreversible damage to our environment and ecosystems.

Unlike the moon landings, overcoming these challenges is not merely a matter of scientific curiosity or ideological supremacy – it is crucial for the survival of life as we know it. But like the moon landings, the challenge is a technological one. More than anything else, overcoming it means finding a way to delink our economy from fossil fuels without impairing living standards. Policy should therefore be orientated around a new mission —  to make a rapid transition to a zero carbon economy.

To succeed, there needs to be huge investment in research and development and a radical transformation of our energy, transport and economic systems. As before, the speed and scale of the task means that it must be state-led. But in Britain four decades of neoliberalism has hollowed out the public sector’s capacity. Steps should therefore be taken to rebuild existing public sector institutions, and increase their capacity to think and act big. But we also need to establish new ‘mission-focused’ research institutions to lead the technological transition. One of these could be tasked with accelerating the energy revolution, focusing research on renewable generation, storage and smart grids, while another could be given a broader remit to research new technologies which minimise material and energy use. Modelled on NASA, these bodies would be encouraged to experiment and take risks, and must be generously funded to ensure that they can attract top talent.

Incentives and partnerships should be established to ensure that the private sector plays a complimentary role in the commercialisation and deployment of new technologies, with rewards appropriately shared with state. Households should be subsidised to decarbonise homes within a certain timeframe via green retrofitting and new energy installations. The benefits of this wouldn’t only be environmental – a systemic decarbonising of the entire economy would create thousands of new high skill, high pay jobs across the country.

All of this will have a significant cost. Mission-orientated policy requires not just any type of finance but patient, long-term, committed finance. But where will the money come from, particularly when public budgets are squeezed and private finance is retreating from funding the real economy? Here there is much to learn from other countries.

In China, Germany and Brazil, mission-oriented public funding is increasingly coming from state investment banks. One example is green energy tech, where state investment banks are now the largest funders of the deployment and diffusion phase of renewable energy, outpacing investment from the private sector. In Germany, the KfW state investment bank has played a key role supporting the Energiewende policy to attain energy security and mitigate climate change through the greening and modernisation of German industries and infrastructures.

Learning from successful examples around the world, a new British Investment Bank would leverage public capital into a major source of long-term, patient finance. This would be channelled into public and private sector initiatives which help facilitate the transition.

Of course, Britain can’t tackle climate change alone. But there is no reason why we can’t lead the way. Two things stand in the way: an attachment to outdated economic dogma, and an aversion to courageous public policy. It’s time we overcame both.

Laurie Macfarlane is economics editor at openDemocracy, and an Associate Fellow at the Institute for Innovation and Public Purpose at University College London – a new institute which focuses on how public policy can be used to direct innovation to tackle societal and technological challenges.

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Why didn’t Transport for London (TfL) invent Uber – and would Londoners be better off if it had done? The issues raised by this question are important and go beyond both transport and London and make us ask who and what the digital revolution is for.

In the jargon, Uber is a digital platform that facilitates peer-to-peer transactions between clients (in this case passengers) and providers of a service (Uber drivers). This allows Uber drivers to increase the use of an under-utilised asset (their vehicle) with little to no transaction cost beyond that imposed by Uber, provider of the platform that makes all this happen.

Platforms such as the one provided by Uber could prove useful in helping us make London a cleaner, more efficient and prosperous city. More shared transport could reduce car use and ownership as people recognise the ease and relatively low cost of jumping in another person’s car. Less ownership and a more efficient use of the remaining vehicles may also lead to reductions in air pollution, CO2 emissions and congestion, and, without so many roads, allow us to change the city’s layout to make living and working easier and healthier.

Platforms like Uber could also do the opposite, increasing the amount of traffic and adding to existing air pollution and CO2 emissions. This is a future in which London’s roads are swamped by private hire vehicles as a precarious job market pushes more people to become Uber drivers. The danger that this model leads to the erosion of labour rights is already with us, an issue that was at the heart of a recent court ruling to block Uber classing its drivers as self-employed. Uber is also famously set up to avoid tax, posting £22,000 tax on a £866,000 UK profit in 2015.

The societal, economic, and environmental effects of peer-to-peer transport platforms such as Uber are only just starting to emerge. Despite the potential for some short-term benefits there may be longer term problems that are difficult to reverse once these platforms become fully integrated into society and the economy.

A major concern is whether the commercial objectives of those who have developed and own these platforms align with the public interest of cheap, clean, efficient transport, and if they do not, whether there are appropriate levers for improving the situation. This brings us back to the twin questions of whether the public good would be maximised (or protected) if Uber were invented by TfL, and, if so, why TfL didn’t invent it.

TfL’s job is to deliver the Mayor’s strategy and commitments on transport, which presumably involve improving transport in the public interest. If peer-to-peer transport platforms could help realise these commitments, then one could argue it was well within the purview of TfL to invent one for London, linking the ability to list yourself or a company to certain conditions, including standards on environmental impact, passenger safety and labour rights.

A TfL app could have also raised significant revenue, an issue that is increasingly pertinent for TfL as it will lose its day-to-day running grant from 2018. London will then be the only city in Europe without a transport subsidy and TfL will likely have to increasingly commercialise or sell its assets.

There are many reasons why TfL may not have wanted, or been unable, to invent a peer-to-peer platform for London. Primarily, TfL raises its revenues from the public transport network it runs and so a platform that could encourage people to jump in cars instead of heading underground would raise questions around the effect on revenues, as well as the unproven environmental outcomes.

Presumably the black cab lobby would have had a lot to say, though it’s possible they could have benefited from being able to list their services on a platform that wouldn’t see them as competition to defeat, as Uber does. A lack of resources for innovation and future thinking may have also played a part. TfL has, and continues, to battle at the forefront of transport innovation, but we should ask whether its current and future resources enable it to continue this battle in a world increasingly disrupted by digital technology.

Beyond just TfL, the attitude toward the role of the public sector and of the state is important here. For the last few decades, political narratives and economic thought have been dominated by the assertion that the public sector is inherently inefficient and wasteful, leading to decisions that inevitably validate this assertion.

In reality, the time for TfL to invent a peer-to-peer transport platform along the lines of Uber has now passed. But the next opportunity is already with us. Around the world, a number of companies and public bodies are developing the idea of ‘mobility as a service’. These platforms build on the concept of Google Maps and Citymapper by offering a monthly subscription for all transport use – imagine a mobile phone contract but for mobility, where you pay, say £300, and get unlimited use of tube, bus, Santander bikes, taxis, and car share within zones 1, 2 and 3. Suddenly, getting from A to B involves seamless mapping and payment, and, if the car share market develops, means you will never need to own a car.

The knock-on effects could be enormous. If TfL were to develop this platform for London it could have some control over these effects. TfL could decide that companies like Uber would only be able to list services on the app if a proportion of their vehicles were electric, for example, or if their staff were entitled to certain employment rights. Presumably the app would become the go-to for getting around London and so it would be in Uber’s commercial interest to do so.

If TfL doesn’t develop this platform, a private company may do so. If this enabled the platform to be developed and that platform helped deliver good environmental and other outcomes, then so be it, some will say. But this would mean that TfL would lose the ability to drive outcomes directly and, assuming the UK government’s ideas don’t change for some time, the scope for regulating the private sector’s actions is limited. London’s mobility as a service platform could then end up like Spotify, for example, where advertising and other conditions are the norm unless users pay for a premium account. One could imagine a future where the owner of this platform could, say, cut a deal with McDonalds and so your taxi ride would go via the drive-thru unless you pay for a premium subscription.

To limit the chance of this world emerging, TfL should invent an app that turns London’s public and private transport network into a service. Considering why TfL didn’t do this in the case of peer-to-peer platforms like Uber helps us understand the barriers to realising the full potential of the digital disruption of transport. It also helps us pose a more fundamental question. Digital technology could enable unprecedented opportunity to remould transport for the public good; will that good be maximised, or even possible, if digital infrastructure is wholly private?

The answers to these questions will have an impact far beyond the transport sector. They are a cautionary tale for the future of our political economy. In short, the digital revolution is disrupting large swathes of society and economy and the pace of this disruption is accelerating. With it comes the potential for great negative as well as positive outcomes. The state – our means of steering these outcomes – is smaller, more under-resourced and more discredited than ever before. This is very dangerous. In developing our response, we must decide whether to be the architects of the future, or its victims.

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It’s déjà vu all over again.

This malapropism is usually attributed to Yogi Berra, a famous baseball player in the early 1960s. It also seems to be appropriate now when thinking about international economic policy in the UK. I could have written ‘analysing’ rather than ‘thinking’ but that would suggest that current policy is the outcome of a serious discussion of options and estimates of the costs and benefits of alternative possibilities. Unfortunately policy makers seem not to have any understanding of the history of Britain’s recent relations with Europe and seem intent on unravelling what has been put together in recent decades irrespective of the impact on both the UK and our partners in Europe. The following will hopefully throw some light on the how and why of where we are presently but is in no sense intended to be other than a personal account of past events that ought to have some weight in current policy development.

I joined the Treasury in the mid 1960s during Harold Wilson’s first government and had a remit that focused on international economic policy. At that time the Government Economic Service was truly professional and was headed by professor Alec Cairncross who was highly experienced in government and very insightful about economic policy. Other economists on the staff included Wynne Godley who subsequently became professor at Cambridge and his close collaborator James Shepherd. There was a depth to economic analysis and policy discussion across Whitehall that has subsequently been eroded in part through the appointment of special advisors who are essentially political aides rather than economists. This weakening of the policy making process is unfortunately only too evident and in part explains the cumulative failures of recent years – not least the deadweight-losses and distributional costs of Osborne’s austerity policies.

The Labour government had a majority of 4 when it took office in 1964 and had inherited a balance of payments in significant deficit. The previous Tory Chancellor (Maudling) had been advised to reduce domestic demand in the 1964 budget but had chosen to ignore this advice and instead cut taxes in advance of the autumn election. But preparatory work went ahead in the Treasury so as to have a range of measures in place to deal with the expected sterling crisis which would inevitably occur given the forecast balance of payments deficit. Wilson chose not to devalue the exchange rate and chose instead a temporary import charge which reduced over time the level of imports. But the underlying position of an overvalued exchange rate continued until the UK was forced to devalue in late 1967 under conditions that were extremely costly for the Treasury and the country.

This background is relevant in that by the 1960s the UK had reached the end of the line in respect of international trading relationships. The Commonwealth which in the 1930s had sustained the British economy had ceased to provide growing and dynamic markets for UK exports in the post war period and indeed had to a degree held back the industrial regeneration that was needed. Thus Tibor Barna demonstrated in an influential paper that dependence on slow growing Commonwealth markets was part of the problem and that shifting exports to faster growing markets would generate more competitive production. The UK had grown slowly during the 1950s in part because of the constraints of the balance of payments (a stop/go economic cycle) and had lagged behind our European competitors. New trading relationships were thus seen as essential if the UK was to break free of the constraints of the balance of payments but there was disagreement about what to do.

On the one hand there were those who wanted to maintain the Commonwealth relationship of essentially protected trade dependent on a set of defence and other preferred relations. This despite the fact that such markets did not display the patterns of demand that were essential if the UK was to develop new and growing industrial capacity. Hence the dispute that went on for ever within the Tory party about sustaining the Commonwealth ties despite the fact that the latter were themselves developing new markets for their output/exports. As we shall see below some of these arguments reverberate today given the belief of some of those supporting Brexit that there exist alternative markets which could easily replace access to the EU single market. The question becomes whether such markets exist and whether the UK would be competitive in the face of for example Chinese, Indian, and Vietnamese products.

In 1957 the six European countries signed the Treaty of Rome establishing the European Economic Community. At that time the UK would have been welcomed as a member but chose not to join and instead formed a rival bloc of seven small countries (EFTA – the European Free Trade Area). It was hoped that EFTA would provide some of the trade growth that UK so desperately sought without the various obligations involved in the EEC whilst allowing the UK to sustain the Commonwealth relationship. EFTA was never a realistic alternative to the EEC and this soon became apparent even to the Tory party that was in office throughout the 1950s and until 1964 when Wilson won the election. Macmillan had by the early 1960s decided that Britain should join the EEC but faced problems within his own party and also from the French. De Gaulle had decided that the UK was simply a ‘trojan horse’ for the USA and after the Nassau agreement on nuclear weapons essentially an American colony.

Charles de Gaulle, by fr.politique.wikia.com/

By the mid 1960s, the UK had run out of options. The Commonwealth couldn’t provide the market growth that British industry needed; EFTA was too small a market to generate the industrial economies of scale needed if the UK was to compete with the Germans, and the French were not prepared to let the UK join the EEC. Wilson when he took office realised that the future of the UK lay with the EEC and he took up the UK application to join in the later 1960s but continued to be rebuffed by the French. Internal economic assessments in Whitehall showed quite clearly the costs and benefits of membership of the EEC with overwhelming support for the gains from membership. Opponents of membership of the EEC within the Cabinet still persisted in supporting the Commonwealth option and some Labour ministers even proposed setting up a free trade arrangement with the USA. As we shall see below the UK tried to address the concerns of the French and these were to a degree easier after the changes in UK defence policies when Wilson abandoned its East of Suez commitments.

But it was left to Edward Heath when he took office in 1970 to actually engage with our European neighbours and he signed the Treaty of Accession in 1973. So finally the UK, having tried all of the various options, had concluded that the EEC was the best and it signed on the bottom line. Of course one of the consequences of joining the club was that the table had been set in the interests of the original members, and the UK had more or less no option but to accept arrangements some of which were definitely not in the British interest such as the Common Agricultural Policy. Herein lies part of the problem with the EEC since its structure wasn’t ever set in the interests of the UK but of the founding members. Mrs Thatcher managed to get the famous fiscal rebate to reflect that fact that the UK was contributing excessively to the EU budget, and has increasingly sought opt-outs from policies that supposedly do not meet British needs. This increasingly semi-detached relationship has not endeared the UK to its EU partners and one would not expect them to be falling over to please Brexiteers in any negotiations as and when these begin in 2017.

A digression – or is it: Concorde

There was great secrecy surrounding the development of Concorde and although public funds were used to support the project from the early 1950s it was not until December 1962 that parliament was allowed to have a debate. Attempts had been made to try and get the USA to share the costs of development but they turned down the opportunity having a totally different view about market opportunities for aviation growth. Proponents of supersonic aircraft made sure that the project was kept as far as possible away from Treasury oversight even though development costs had already vastly exceeded the estimates originally produced. In the end the development costs were no less than 15 times the original estimates.

Tory governments during the 1950s were keen to take forward Concorde in part so as to support the British aviation industry which was reeling from the failure of the Comet aircraft. In part the problem was an engineering one – how to design a plane which could carry enough paying passengers and not make operational losses in the process. This was never resolved and the plane often flew with only half of the seats occupied. There were also the severe environmental issues – of noise and pollution – which were never solved and exercised the minds of many of those affected by the plane in urban settings. While back of the envelope projections were made in the Ministry of Aviation of a market for the aircraft of between 150 and 500 planes only 16 were ever produced. These were acquired by British Airways and Air France which were both national carriers at that time either at discounted prices or for free. Both airlines were also given guarantees by their respective governments against operational losses.

The Macmillan government having been rebuffed by the Americans turned to the French and discussions started about a joint venture in 1959 and finally in 1962 an agreement was reached on funding and development of Concorde. What is remarkable about this agreement is that no market assessment was ever made and no one ever approached the main airlines to ask whether they would buy a supersonic aircraft. Furthermore it was agreed that if either partner pulled out of the project then they would have to fully compensate financially all of the costs incurred by the other country.

Why was the British Government so committed to Concorde? Well the answer to a degree relates to the discussion above that UK had by the early 1960s decided that its trading future lay with the EEC. The joint development of Concorde with the French as a full partner was supposed to demonstrate two things. Firstly, that UK would bring to the EEC a viable and high tech aviation industry to rival the dominance of the USA, and secondly that it was now committed to a European market as represented by the Economic Community. Macmillan was not of course committed to the vision of Europe of Monnet and Schuman who saw economic arrangements as a stepping stone to broader political integration. Rather, Macmillan’s decision in 1962 to apply to join was essentially economic and herein in part lies the genesis of the problem in the longer term.

Unfortunately for Macmillan the French were not convinced that the UK was ready to join the EEC and De Gaulle rejected the application in January 1963. When the Wilson Government came into office in the autumn of 1964 it looked at the agreement with France and at the costs of developing Concorde and tried to cancel the project. They were appalled at the fact that no commercial assessment had been made of the market for the plane and that cancellation by either partner would lead to compensating the other for all of the costs incurred. Labour decided it was simply easier to continue with the project rather than cancel it. Furthermore, as noted above, Wilson became convinced that joining the EEC was the only viable strategy so he took up the application that was still on the table and engaged the French government in further discussions. Concorde was part of the background to the discussions but in itself proved insufficient to get the French to change their opposition and Pompidou again rejected membership.

The best and easiest accessible analysis of the tangled web of events relating to the development of Concorde is to be found in the Atlantic Monthly, Jan 1977 (Supersonic Bust by Robert Gillmann). It’s a sorry story and an example of the far too many appallingly bad public investment decisions made by British governments over the past 50 years. The project was hugely expensive – estimated by David Henderson who was chief economist at one stage at the Ministry of Aviation at £4.26billion in 1975 prices. The Concorde project furthermore tied up the scarce engineering and design capacity of the British aviation industry for decades at a time when the global market was expanding rapidly. Allowing this hugely profitable market to be captured by the Americans who had rightly seen no future in supersonic flight.

And then there is Hinkley Point C

Hinkley Point nuclear power stations, by Richard Baker.

The parallels between  Concorde and the decision made in September by the May government to go ahead with the building of the first nuclear power station for many years is truly amazing. It is as if the British have a preference for investments that are white elephants, and are determined to go ahead with immensely expensive projects despite the evidence that they are not the best solution to national needs. The French, Chinese and British governments have agreed jointly on the building of Hinkley Point C at an estimated cost of £18billion. This is despite the fact that the technology is untried and that the 2 plants presently under construction in Finland and France are years behind schedule and well over budget. The Finnish plant was due to come on stream in 2009 and is now 5.2 billion euros over budget while the French plant is 6 years late.

As with Concorde, the government has chosen a technology that is risky when other alternatives are available. The government has itself confirmed a report from the National Audit Office (July 2016) that by the mid 2020s that large scale solar and onshore wind power would generate electricity more cheaply than that produced by Hinkley Point. Indeed, the government estimates are that sustainable sources of energy would be half the price of nuclear. Furthermore there would not be any need for the price guarantees given to the Chinese and French developers in the contract (the latter are expected to add very significantly to the electricity bills of consumers over several decades and have been estimated by the National Audit Office as up to £30billion). There also remains the complex issue of responsibility for decommissioning the nuclear plant and who bears the cost of this huge and unpredictable expenditure. Notionally this will fall on the developers but the contracted costs look as if they will be far below the actual cost and the huge excess will fall on UK taxpayers.

So why would the British government choose nuclear over the available alternatives? The technology is untried, the costs of construction are inevitably going to be billions more than estimated and the project delayed by many years, and the costs of operation greater than competing sustainable energy alternatives. There will be ongoing subsidies to operators and the clean-up costs impossible to predict but inevitably huge (the present estimate is up to £7.2 billion but they will be many times that figure). There are so many elements here that parallel the case of Concorde and in the final analysis the costs will again fall on the UK tax payer.

Where are the benefits?  Well these seem to lie in the nebulous and unlikely possibility of access to the Chinese market for British exports, and an ability to draw down Chinese direct and financial investment in the UK. In the case of exports of goods and services to the Chinese these are already possible under WTO rules so what would be gained by the Hinckley contract? Similarly in the case of Chinese investment where the Chinese will make rational decisions on where to put their savings and this will depend on the usual assessments of financial return and profitability. Of course the investment in Hinkley Point may generate further opportunities for Chinese nuclear contractors in the UK but this is highly uncertain given that nuclear will be a high cost option relative to other sustainable energy.

In large part the British are going ahead with Hinkley because of the market disruption caused by Brexit. The loss of privileged access to the EU market for goods and services will mean finding alternative markets – and the Chinese market is huge and is growing. But as noted above, for most products, the Chinese are a much lower cost producer than the UK. So where would the market opportunities lie? The British current account is already in large deficit and has been for many years and has been financed by capital inflows – some of it from China. The hope presumably in government is that it will continue to be possible to draw-down Chinese savings to finance the ongoing deficit – a deficit that will probably widen after Brexit. But this is a highly uncertain strategy and one that no sensible government would find attractive given the political structure of China and instability in Chinese/Western relations.

Where to now?

Membership of the EEC and subsequently the EU has been immensely beneficial to the UK. There have been large and ongoing economic benefits as was predicted in the early assessments undertaken in Whitehall in the 1960s and subsequently confirmed by innumerable economists. The recent Treasury assessment of the cost of Brexit of a reduction in British GDP of between 5.4% and 9.5% looks only too realistic, and represents an estimate of the gains to GDP that the UK has had from membership of the Community.

There have, of course, been non-quantifiable benefits which have been just as important not least the opportunity to draw on highly skilled and professional labour from across the EU over many years. Not least of the benefits has been an awareness over time that the future of the UK lies in cultural and social integration with our partners in Europe – recognised most fully by the youth of Britain who overwhelmingly voted to remain in the EU in the June referendum.

There is no realistic alternative to the EU available to the UK out there – a world of supposed ‘free trade’ which has been always a fiction in the minds of a few classical economists and naive Tory politicians. As we have seen above in the brief history of our accession to the EEC and subsequently the EU there is no alternative, as even Mrs Thatcher finally realised as she signed the Treaty of Maastricht.

What we now have is a world of managed trade where membership of a large trading bloc such as the EU is essential for access to global markets on reasonably fair terms. There is no way the UK could freely compete with the low wage economies of East and South Asia in most manufacturing products. Rather the future of the UK has to lie with products and services that embody high levels of education and technology. These are precisely the capacities that are developed and sustained by ongoing membership of the EU.

Brexit, if it ever happens will cause deep economic and social costs and is totally avoidable. It would be yet another example of policy decisions of which there have been far too many examples in recent British history and which have been disastrous in their impact on the population. If Brexit is persisted with by the present government, not only will it reduce GDP, cause high and unnecessary unemployment, and social distress but it will probably also lead to the breakup of the UK.

Why would any government choose to go down this path?

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Our medical R&D system is undermining our health – reform could boost our economy and our wellbeing.

The medicines that work their way through the university labs, clinical trial sites and pharmaceutical manufacturing facilities to NHS patients are not the ones that we need the most. Rather, they are the ones that can make the most. Profit, rather than health need, drives our medical research and development system and that reality has huge consequences for society.

Whilst it is true that the drugs developed under the profit incentive can often deliver improved medical outcomes, this is frequently not the case. Too many new medicines simply don’t represent progress – some estimates say up to 70% of all newly licenced drugs are worse or no better than the ones we’ve got. This means pharma is wasting billions on research to replicate existing medicines, and then billions more (spend on marketing is approximately double the spend on R&D) to sell us the inferior drugs they produce.

And too often diseases that kill millions every year, like tuberculosis, are ignored (we’ve only developed two new TB treatments since man first stepped on the moon) because there are few profits to be made from the poor people it affects. The same market failure is behind the existential threat posed by antibiotic resistance. We have no new antibiotics because any developed by the pharmaceutical industry will be used only when absolutely essential. There will be no blockbuster sales here, so the investment goes on other safer, more profitable bets.

Directly connected to these huge weaknesses are the problems generated when we do see a new, effective medicine developed: prohibitively high prices facilitated by patent-based monopolies. These monopolies are the core of the current medical R&D incentive system. But when the NHS is facing an unprecedented threat to its future, those monopolies are resulting in drug price increases way beyond the rate of inflation and without comparable improvements in outcomes. Increasingly, the NHS simply cannot foot the bills – and from cancer to hepatitis it is forced to ration access to lifesaving medicines.

Big pharma wring their hands and say it may be an imperfect system, but it’s the only one we’ve got – if we want medical innovation there is no alternative. But that’s a lie. By paying up front for the innovation we need – either through grants or prize funds we could ensure the R&D is driven by need not profit. And by paying for it up front, we don’t need to reward innovation with a patent-based monopoly – we’ll own the IP and can licence it out to multiple manufacturers to produce the pills. They’ll compete for market share and bring the price down close to the cost of production, as we see with generic medicines today. For example, the NHS has to pay almost £40,000 for a course of sofosbuvir, a hep C treatment that is made and sold for a profit at £300 where the patent doesn’t apply.

This alternative approach has been proven to work – the Drugs for Neglected Diseases Initiative has developed new medicines for $130m, a fraction of the $2.5bn figure often quote by industry. Indeed, in contrast to the right’s rhetoric that the state can’t do innovation, 70% of truly novel drugs with new molecular entities trace their origins to a public or philanthropically funded lab.

We already pay for medical research three times over – through public research grants, tax cuts for big pharma, and the NHS drugs bill. It’s time we implemented a new, more efficient, collaboratively driven, open innovation model with patient needs at its heart. In doing so we can re-energise our research institutions, harness the brilliance within our universities and pharmaceutical industry to deliver better medicines, and safeguard the NHS and its patients so they are not held to ransom by monopolist drug corporations.

There is a better way to do medical R&D and by pursuing it we can help to protect the future of the health service – the question is whether there is the political will to put patient lives before big pharma profits.

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It can take a thousand years to form an inch, which can be washed away in a moment. It provides 95% of our food, and yet we allow it to blow off in the wind. Civilisations rise and fall on how they treat it, and we treat it like dirt. I am talking, of course, about soil. Researchers at Sheffield University concluded two years ago that Britain’s fields are so depleted that our earth had a hundred harvests left in it. So make that ninety eight. Other stats are even scarier. According to New Scientist magazine, if we don’t slow the decline, all farmable soils in the world will be gone within sixty years.

There are lots of simple things which the government really should be doing to combat this. It has a unique opportunity to rethink our approach to farming, as Brexit will remove the UK from the EU ‘Common Agricultural Policy’ (CAP), repatriating regulatory powers. The government should better regulate or indeed curtail disastrous maize farming. It should encourage more crop-rotation and upland tree planting; support wetland restoration and beaver-reintroduction; ban heather burning on grouse moors; minimise soil compaction from livestock and machinery, and invest in a mass switch to organic farming.

But it seems to me that, whilst all of these policies are necessary, they are insufficient to tackle the global scale of this crisis. Adjustments to conventional farming methods help – but they don’t tackle another great problem: that the extensive land use required by such practises means eating into ever more wilderness, wiping out ever more species. So as well as reforming our traditional land farming, we should look into alternative agricultural solutions, which will allow us to feed ourselves without asset-stripping the planet and dooming future generations to food scarcity.

Hydroponic and aquaponic farming allow for the growth of vegetables in water enriched with nutrients (in the latter case, through the presence of fish). Famous largely for its use by cannabis growers, many other kinds of crop can equally flourish without soil. It’s not a new idea: Francis Bacon referred to ‘water culture’ in his 1627 book ‘Sylva Sylvarum’, and there was an eruption of research immediately afterwards. Studies in the 1960s showed it to be no more efficient than growing food in good quality top soil. But with less and less good top soil around, those figures get more and more appealing. And that’s without mass investment in research and development that could make these methods even more efficient.

Similarly, 3D ocean farming offers the opportunity to grow much more of our food in the seas, whilst at the same time replenishing our life-bereft maritime ecosystems. Seaweed doesn’t currently form a significant part of the European diet. But it is delicious, and can also be used as livestock feed. As the soil crisis hoves into view, it seems likely that new farming techniques along these lines will see ever greater demand. And just as those countries who got ahead of the game in renewable energy twenty years ago are reaping the rewards now, it seems likely that government backing for such agricultural innovations will reap long term dividends on the global market.

But if we are going to go down this road, it’s worth asking another question: If the 1909 allotment act gave each of us the right to land on which to grow food, why not update it to give every family access to a space in a shared hydroponic tower? What about our numerous impoverished seaside towns? Why shouldn’t councils lead investment into ocean farming co-ops?

And if much large-scale modern agriculture is done by carefully programmed machines, why can’t we equally automate the growing of our own food? Why can’t Britain be the country which develops the technology by which your own veg, or seaweed, or shellfish, grown in your community allotment, can be picked by your community’s automatic harvester and delivered to your home by a community-owned self-driven car or drone? Ownership of Britain’s agricultural land is astoundingly unequal, and new technologies offer an opportunity to democratise food production, beginning to tackle a food poverty crisis whose icon has become a growing array of food banks.

The food and drink supply chain is the UK’s single largest manufacturing sector. It accounts for 7% of GDP, employs 3.7M people and is worth £80Bn per year. Because of CAP, it has been protected from the global market for decades. As Britain leaves the EU, we must decide what role it will play in the future of our economy. We can allow it to be asset stripped like most of our industry, or we can accept that at a time of fast technological change and vast environmental challenges, we will have to embrace the former if we are to survive the latter.

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What is medicine for? Surely an easy question, right? Apparently not. I have always believed that the purpose of medicine is to alleviate the suffering caused by ill-health and death. One must include both, because death itself is very effective in ending the suffering caused by ill-health, and even though there is vibrant debate concerning the appropriate access to assisted suicide, society overwhelmingly adopts the policy that life is sacred and must be extended at virtually all cost.

Or does it? There is a bizarre contradiction in our collective approach to the ill-health of old age. On the one hand we are happy to allocate billions upon billions to the quixotic pursuit of extended but functionally impaired life, under the banner of geriatric medicine, but on the other hand we overwhelmingly express deep ambivalence, if not outright opposition, to the idea of future medicine that would actually work – that would entirely abolish those ailments and maintain youthful mental and physical function to much greater chronological ages. When asked to consider such a world, most people are far more inclined to raise concerns about how society would manage the likely side-effect of increased average longevity, than to pay any attention whatever to the prospective alleviation of so much suffering.

I have discussed in many other places the psychological underpinning of this phenomenon, so I will not repeat myself here. Instead I will focus on the economic imperative to hasten the arrival of truly effective anti-aging medicine, and the consequent duty of governments to allocate greatly increased resources to the effort to develop them.

The ill-health of old age currently accounts not only for over 70% of deaths worldwide but also for a similar proportion of medical expenditure. In the industrialised world, these numbers are in the region of 90%. What if we had medicine that would prevent the conditions on which all that money is spent? The money would be saved! Sure, the medicines that achieved this prevention would themselves cost money, but there is no reason (not even any hypothetical reason) why prevention should not be better (i.e. cheaper) than cure in this case as it usually is. And that’s just the start. Do you, or does anyone you know, have a parent with advanced Alzheimer’s or any other age-related chronic disease? How much productivity is lost from the burden of caregiving as a result? It’s astronomical. And beyond that, consider the wealth that the elderly could contribute to society if only they remained able-bodied. The economic benefit would be unimaginable.

How is this not completely obvious to everyone? My only explanation is that the powers that be are just as irrational about aging as the rest of society. There can be no doubt that policy-makers are acutely aware of the economic realities that I summarise above, but their decisions are based on their perceptions of the impact on their priorities. And it seems that policy-makers remain convinced that it is not in their interests to inject relatively minuscule sums into research that could pay for itself literally millions of times over. Why? Only two explanations seem available. One is that the reward is further in the future than the current electoral cycle, such that whatever the logic of such a course, it would be against the nearer-term vested interests of the political elite. The other is that these decision-makers truly feel, in spite of all the scientific evidence trumpeted by biogerontologists every day, that the probability of actual success (i.e., of a substantial hastening of the defeat of ageing) from such expenditure really is less than one in a million, thus outweighing the benefit that success would bring. Neither such attitude is remotely excusable.

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London’s Garden Bridge will cost £60m of public money, and may even require a public bailout upon completion. Meanwhile, museums in Derby, Lancashire, Jarrow and Durham face closure. The cost of keeping them open is a tiny fraction of the public money funnelled into the Garden Bridge.

Of course, the problems with Britain’s economy don’t begin and end with the Garden Bridge, but it is a fantastic symbol of how skewed the nation’s economy, culture and infrastructure investment are towards London and the South East. It’s also an explanation for the resentment people living outside of London feel for the national overemphasis on the capital.

The first thing to address when it comes to rebalancing the economy is George Osborne’s idea of ‘Northern Powerhouse’. This was marketed by the then Chancellor as a way of rebalancing the economy and fueling economic growth in the North. But, as Daniel Bailey wrote for the Centre for Labour and Social Studies: “there is a great incongruence between the soaring rhetoric of devolution and the actual policy content of City Deals, such as the one in Sheffield, where only modest budgetary powers have been handed down. Moreover, an analysis of the specific powers being transferred speak to Whitehall’s existing objectives rather than an enabling of any deeper sense of decentralisation.” The emphasis on Whitehall has been demonstrated in farcical news stories about over 200 Northern Powerhouse jobs being moved from Sheffield to London.

In short, the Northern Powerhouse initiative is an exercise in devolving blame but centralising power. City deals mean British regions will get the choice over how they spend an ever-decreasing pot of money, and may even end up undercutting one another if business rates are also devolved. This doesn’t devolve power, it just outsources austerity. It’s not a solution to the problem of a London-centric economy; it is part of the problem.

What the UK needs is a proper industrial strategy to develop communities across Britain. This would involve investing more in the manufacturing industries so that there are plenty of well-paid skilled jobs in areas that have previously suffered industrial decline. Part of this industrial strategy would be to invest heavily in research and development to ensure the technology Britain develops can be exported to other countries, and the revenue used to invest in the country’s future.

A proper transport strategy is also needed to balance the economy away from London. By improving transport links and reducing commuting costs, the government could create a metropolis encompassing many northern cities – like a spiderweb of different economies across the north. This would be a far better solution to Londoncentricity than HS2, which is essentially a project to make commuting to London easier.

Finally, some national institutions should be relocated to the north. Parliament could be moved to Newcastle, taking many journalists and lobbyists – and the money they spend – with it. The BBC already has a huge media centre in Salford, but this could be expanded further. National newspapers could be offered peppercorn rent for opening regional offices outside of London. The financial, political and media hubs of the US are spread across the country. It is absurd that the UK crams all of them into the same city at the expense of everything else.

These are just a small number of ideas for a balanced economy. The government must think of more, and make enacting them a priority. London can no longer be allowed to remain Britain’s black hole, sucking in all the resources in its vicinity.

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Technology has changed everything, now politics – and how we relate to each other – needs to catch up. Whether you call it post-capitalism or ‘fully automated luxury communism’, the essence of this remains the same: that technological gains, rather than enhance the profits of those who own the means of production – the industrial robots and intellectual property, as much as the factories and the mining drills – should lead us to a society of leisure; that the dividend of new technologies – AI, robotics, and synthetic biology – should redound to the benefit of human beings. This, then, is the vision for a left politics which remains comprehensible to social democracy, we might have a twelve hour work week for instance, but which also transcends it.

The present nightmare at the heart of this dream is all too familiar. Right now innovation means greater precarity in work, just ask an Uber or Deliveroo worker, as well as technological unemployment and falling real wages. What Keynes got wrong in his visionary ‘Economic Possibilities for Our Grandchildren’ is that technology, under capitalism, can never mean less work. After all, that doesn’t generate higher profit or allow businesses to stay competitive.

Last year Andy Haldane, the Bank of England’s chief economist, spoke of how fifteen million jobs in the UK could be lost to technological change in coming decades. The spectre of mass technological unemployment, nothing new but now set to be a deluge – especially with AI and advanced robotics – is fast approaching. What we now need to understand is that this is not a threat, but the path to an upgraded civilisation.

Marx was making precisely that point when he wrote, “Through this process (automation) the amount of labour necessary for the production of a given object is indeed reduced to a minimum, but only in order to realize a maximum of labour in the maximum number of such objects. The first aspect is important, because capital here – quite unintentionally – reduces human labour, expenditure of energy, to a minimum. This will redound to the benefit of emancipated labour, and is the condition of its emancipation.”

Emancipated labour? That is a post-work world, one where we need only engage in waged labour for a few hours a day. Getting there requires a new kind of politics – both in and beyond government – as well as necessitating a cultural shift in understanding that work isn’t a unique source of spiritual nourishment. Attendantly, it will also require people to figure out how best to flourish under conditions of post-scarcity. How to live, as Keynes put it, “wisely, agreeably and well”. That is probably the biggest question of all, given that such conditions are entirely without precedent in the history of our species.

But how do we get there from the here and now? After all, fully automated luxury communism is a long way from a mixed-market economy that is increasingly high-tech and low regulation. Well, alongside introducing a guaranteed social wage and ensuring that public goods like housing, health, education and maybe even public transport are free at the point of use, I’d also have a government-sponsored ‘incubator’ – call it ‘FALCvest’ – that examines parts of the economy that can be transitioned to full automation. Such an incubator would trial solutions and find whether they were scaleable and safe. Self-driving ambulance drones? How much labour time would they save? And would they deliver better services? What conditions would have to be met for their adoption? 3D printed social housing? How effective, and beautiful, would the houses be? Could we also guarantee soundproofing and total energy insulation? How many hours would be saved?

In essence, then, FALCvest would offer venture post-capitalist solutions. It would undertake feasibility studies in regard to automating certain parts of the economy, calculating post-capitalist returns on investment, that is to say the time saved for workers – who would still be paid through the guaranteed social wage, and who would still work a few hours a day regardless.

But as well as doing feasibility studies – in collaboration with service users, workers and citizens – undertaking trials and experimenting with new technologies and processes in moving to full automation, FALCvest would also operate a Venture Deflation Fund. Technological progress, it increasingly appears, is price deflationary in nature. The aim of the fund would be to offer seed capital to inventors and entrepreneurs to create new technologies, platforms and products which take goods and services out of commodity circulation and into the commons. These products would, again, be free at the point of use and maintained by an ecology of volunteers (don’t forget that guaranteed social wage) and public sector employees – on a significantly reduced working week, of course.

Over time, as technologies continued to improve: as the cost of data and energy storage, as well as bandwidth and computional power continue to plummet, FALCvest would seek to find further efficiencies in the economy, ensuring that the advances of technology, consistently, are at the service humanity rather than profit.

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