Views from the (Brighton) Sea Front June 2012
There’s a lot of sighing going on out there. Big sighs. Little sighs. And the barely discernible, whispered sigh. The sigh of despair.
Did I hear the chap who runs Mykonos, the little Greek taverna at the bottom of my street, mournfully deliver one of the latter the other day?
He looked forlorn. Possibly a little haunted. Standing outside the restaurant, looking in at the empty tables. It was lunchtime.
While competition in the restaurant trade down here is tough, I rarely see anyone tucking into a kofta in Mykonos. Back in the day it was the go to place. No longer.
As sure as the drachma will return to his homeland, my money is on an early exit for the taverna. A metaphor, perhaps, for the state of the proprietor’s home country: lots of things on the menu, but struggling to raise any interest.
We are, I know, all Greek-ed out.
You don’t have to watch the news to get an idea of how tough it is. Shops closing left, right and centre. Workers being laid off. Crisis piling on top of crisis. It’s no wonder the far right is taking hold in Greece. The conditions we are currently experiencing were an ideal breeding ground for Nazi ideology. Likewise with Franco in Spain and the lardy one, Mussolini, in Italy. The country’s in a mess, the economy has gone to pot –let’s get heavy, throw our weight around.
Even better, let’s get our factories mass producing military hardware and create a full employment economy. And go to war! Cue high fives all round.
Except the world has changed and it is not that simple any more. Real crises call for real solutions. The exasperation with Brussels, exasperation with the intransigence of politicians in countries now on their knees because nothing was done to enforce tax collections and properly run exports and imports when it mattered, is now evident everywhere I go.
Sometimes that exasperation turns nasty – I have witnessed several incidents in recent months in public places where I suspect the stresses of daily life have played a major part. The muttering and swearing builder in Tesco Express, vainly counting out pennies for a pack of ten fags, looking embarrassed and saying he didn’t know how the family was going to get through to pay day. The pensioner in the bank, shaking his head and asking anyone who would listen why he can’t afford his electricity bills any more. The dazed, tired looking woman in the local garage wondering how she is going to pay for her ancient Corsa to get through the Mot.
Masses of unemployed kids roaming the shopping malls up and down the country, looking bored and angry. And who can blame them? There is no work, and they feel cheated.
When will it all end? Will it end?
The short answer is yes. And of course any Conservative politician will tell you that they inherited a mess, that Labour allowed us to get fat off the back of an economy propped up debt. And to an extent that is correct.
We did overspend. We did over borrow.
Lecturing at the University of Sussex recently, on the MA Journalism course (yes, students are getting younger), I referred to an old front page story of mine – from 1999 – which warned on the fact that Northern Rock’s 125 per cent mortgage deals were flying off the shelf so fast they could not keep up with demand.
But the bank kept lending. Often to homebuyers in their early 20s who used the additional money above the mortgage to furnish their homes – and even that was on the never never.
Now multiply this scenario thousands of times, hundreds of thousands of times, and you have a recipe for catastrophe. The bank, in common with many others, lent money it did not have. It depended on other banks within the system playing the same game. Sooner or later the money was going to run out. Game over.
I wrote that story 13 years ago. It took a further 8 years for the money to properly run out, but when it did, boy did we know about it.
But, rather than keep picking over the disastrous errors of the past, let us look to the positives of the future. And remember that every generation goes through several painful economic cycles, some worse than others.
Economies do recover. Eventually. As Vince Cable keeps saying, we need to manufacture and export goods that people want. Germany does it, so do the French.
We do it too. But just not enough of it, although some of our companies are doing incredibly well. Look at Rolls Royce. It’s British, and actually makes things. And lots of other countries want the things it makes.
Last year the company quietly generated £7.8 billion of our GDP. It employs 22,000 people in the UK, almost the same again overseas, and 85 per cent of its sales are in exports. Profit in 2011 was £1 billion. And not an investment fund manager or paper pusher in sight. The company’s order book now stands at £62 billion — nearly four times the value of RBS. What’s not to like?
There are many other success stories out there. Our coach, train and boat manufacturers, like our carmakers, continue to do well. So do our IT and hi-tech industries. The UK has always been at the technological forefront in aviation, motor and sea faring hardware. We punch above our weight. But we need to get back to those golden times when order books were bulging and it was hard to find enough skilled labour to do the job.
The fly in the ointment, and the real impediment to recovery is, by and large, the banks. Not lending to smaller firms, which need capital investment to grow, is putting the brakes on the wider economy, and until the banks free up more money – and God knows they make enough of it – then progress will be slower.
It would also be good to see more investment in our film and television industry. I’m a fan of the French cop drama Braquo. It’s sexy, cool, shot in Paris, with a good sized budget – and it is all home made.
It makes the likes of Spooks – which we pay for courtesy of our TV license fee – look like it was made in Jeremy Paxman’s backyard.
A bit of Gallic know how goes a long way. But I still wouldn’t want to be on the same plane as Gerard Depardieu.
C David Andrews June 2012