Budget 2011: shock doctrine in the UK

George Osborne’s Budget will attempt a radical social re-engineering of the UK.

So will next Wednesday's Budget be "Shock and Awe: phase II" for the UK? The government's mantra of a "budget for growth" would have us believe otherwise. But even if we are spared any bombshells of the 20 per cent VAT variety, we can still anticipate what Pentagon planners call the "smart war" approach. Expect the Budget to be a more precision-guided follow-up to the original onslaught – and with the words "enemies of enterprise" chalked all over the warheads.

But, smart bombs or otherwise, the underlying coalition programme remains the same: a refashioning of the balance of power between social classes and public and private interests that George Monbiot lambasted last year (referring to the bestseller by Naomi Klein) as tantamount to the UK's very own "shock doctrine".

Klein's book of the same name shows how vested interests may capitalise on times of crisis to impose the sort of economic restructurings that folk would normally reject as sheer folly. It is becoming increasingly clear that, from cuts to tax breaks, the coalition is taking all the steps it can to refashion the country along pro-market, anti-equality lines.

Against such accusations, the government claims it is merely being level-headed: paying off all that burdensome debt and warding off the markets that prowl about our neighbours. But just as Margaret Thatcher proselytised the virtues of private ownership to cover her clawing away at public institutions, so today does David Cameron preach about devolved responsibility to hide the true intention behind making the cuts.

The Iron Lady's cold individualism may appear to have been shuttered out from this by talk of the "big society", but in truth Cameron has simply tacked up the garish swags of community empowerment in its place. Either way, we are left with little more than window-dressing for an ideological crusade.

Which is why we can expect further moves in this direction from the Budget.

Cue the anticipated setting aside of money for the sort of "enterprise zones" that Thatcher tried to introduce. These will be hoped-for pockets of success to be pointed to later, against the tide of the country's widening geographical inequalities.

And watch out for Osborne's preference for Pareto optimality as a policy tool: outlawing any policy intervention on behalf of the needy if it stands to impinge even marginally on the interests of the rich. These may well be interests he is now reliant upon to kick-start the economy.

But at times of cutbacks it is the least well-off who need most protection, and women among those most of all (one analysis of tax and benefit cuts after the June Budget shows that women bore 72 per cent of the cutbacks). Their basic needs are hardly the "enemy" of future growth.

Add to this the government's ongoing "war" on bureaucrats and the ratcheting up of a culture of aggression against "the forces of stagnation", the government's assault on local councils, the housing benefit cuts driving poorer people into cheaper rental "sinks", the cuts to and reshaping of the education system, and we are already well up to our necks in the sort of social re-engineering that Klein would be only too pleased to call a shock doctrine. A land that Thatcher would have been only too pleased to call home.

And with the Budget coming before the cuts agreed to last year start to make themselves properly felt, we have some chastening longer-term consequences to look forward to. As a recent study has shown, the combined effect of the ongoing and anticipated further precision targeting of welfare benefits and public expenditure will be to render the UK's public expenditure even less than that of the United States by 2014/2015. If fully implemented, this "unprecedented" development will equal, in the words of the study's authors, "a radical new departure in British policy directions".

Is this the brave new world that favours the boldness extolled by George Osborne at Davos in January this year? It may be for the decreasing few who can avail themselves of its pleasures. For the rest of us, it won't be a step towards the future at all. When Osborne's economic surgery is complete, it is more likely we will wake to find ourselves back in the night-time of Thatcher's Britain. Only now the lights will have gone out, too. And the trains still won't run on time.

Simon Reid-Henry is a lecturer at Queen Mary, University of London.

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An unmatched font of knowledge

Edinburgh’s global reputation as a knowledge economy is rooted in the performance and international outlook of its four universities.

As sociologist-turned US Senator Daniel Patrick Moynihan recognised when asked how to create a world-class city, a strong academic offering is pivotal to any forward-looking, ambitious city. “Build a university,” he said, “and wait 200 years.” He recognised the long-term return such an investment can deliver; how a renowned academic institution can help attract the world. However, in today’s increasingly globalised higher education sector, world-class universities no longer rely on the world coming to come to them – their outlook is increasingly international.

Boasting four world-class universities, Edinburgh not only attracts and retains students from around the world, but also increasingly exports its own distinctively Scottish brand of academic excellence. In fact, 53.9% of the city’s working age population is educated to degree level.

In the most recent QS World University Rankings, the University of Edinburgh was named as the 21st best university in the world, reflecting its reputation for research and teaching. It’s a fact reflected in the latest UK Research Exercise Framework (REF), conducted in 2014, which judged 96% of its academic departments to be producing world-leading research.

Innovation engine

Measured across the UK, annual Gross Value Added (GVA) by University of Edinburgh start-ups contributes more than £164m to the UK economy. In fact, of 262 companies to emerge from the university since the 1960s, 81% remain active today, employing more than 2,700 staff globally. That performance places the University of Edinburgh ahead of institutions such as MIT in terms of the number of start-ups it generates; an innovation hothouse that underlines why one in four graduates remain in Edinburgh and why blue chip brands such as Amazon, IBM and Microsoft all have R&D facilities in the city.

One such spin out making its mark is PureLiFi, founded by Professor Harald Haas to commercialise his groundbreaking research on data transmission using the visible light spectrum. With data transfer speeds 10,000 times faster than radio waves, LiFi not only enables bandwidths of 1 Gigabit/sec but is also far more secure.

Edinburgh’s universities play a pivotal role in the local economy. Through its core operations, knowledge transfer activities and world-class research the University generated £4.9bn in GVA and 44,500 jobs globally, when accounting for international alumni.

With £1.4bn earmarked for estate development over the next 10 years, the University of Edinburgh remains the city’s largest property developer. Its extensive programme of investment includes the soon-to-open Higgs Centre for Innovation. A partnership with the UK Astronomy Technology Centre, the new centre will open next year and will supply business incubation support for potential big data and space technology applications, enabling start-ups to realise the commercial potential of applied research in subjects such as particle physics.

It’s a story of innovation that is mirrored across Edinburgh’s academic landscape. Each university has carved its own areas of academic excellence and research expertise, such as the University of Edinburgh’s renowned School of Informatics, ranked among the world’s elite institutions for Computer Science. 

The future of energy

Research conducted into the economic impact of Heriot-Watt University demonstrated that it generates £278m in annual GVA for the Scottish economy and directly supports more than 6,000 jobs.

Set in 380-acres of picturesque parkland, Heriot-Watt University incorporates the Edinburgh Research Park, the first science park of its kind in the UK and now home to more than 40 companies.

Consistently ranked in the top 25% of UK universities, Heriot-Watt University enjoys an increasingly international reputation underpinned by a strong track record in research. 82% of the institution’s research is considered world-class (REF) – a fact reflected in a record breaking year for the university, attracting £40.6m in research funding in 2015. With an expanding campus in Dubai and last year’s opening of a £35m campus in Malaysia, Heriot-Watt is now among the UK’s top five universities in terms of international presence and numbers of international students.

"In 2015, Heriot-Watt University was ranked 34th overall in the QS ‘Top 50 under 50’ world rankings." 

Its established strengths in industry-related research will be further boosted with the imminent opening of the £20m Lyell Centre. It will become the Scottish headquarters of the British Geological Survey, and research will focus on global issues such as energy supply, environmental impact and climate change. As well as providing laboratory facilities, the new centre will feature a 50,000 litre climate change research aquarium, the UK Natural Environment Research Council Centre for Doctoral Training (CDT) in Oil and Gas, and the Shell Centre for Exploration Geoscience.

International appeal

An increasingly global outlook, supported by a bold international strategy, is helping to drive Edinburgh Napier University’s growth. The university now has more than 4,500 students studying its overseas programmes, through partnerships with institutions in Hong Kong, Singapore, China, Sri Lanka and India.

Edinburgh Napier has been present in Hong Kong for more than 20 years and its impact grows year-on-year. Already the UK’s largest higher education provider in the territory, more than 1,500 students graduated in 2015 alone.

In terms of world-leading research, Edinburgh Napier continues to make its mark, with the REF judging 54% of its research to be either world-class or internationally excellent in 2014. The assessment singled out particular strengths in Earth Systems and Environmental Sciences, where it was rated the top UK modern university for research impact. Taking into account research, knowledge exchange, as well as student and staff spending, Edinburgh Napier University generates in excess of £201.9m GVA and supports 2,897 jobs in the city economy.

On the south-east side of Edinburgh, Queen Margaret University is Scotland’s first university to have an on-campus Business Gateway, highlighting the emphasis placed on business creation and innovation.

QMU moved up 49 places overall in the 2014 REF, taking it to 80th place in The Times’ rankings for research excellence in the UK. The Framework scored 58% of Queen Margaret’s research as either world-leading or internationally excellent, especially in relation to Speech and Language Sciences, where the University is ranked 2nd in the UK.

In terms of its international appeal, one in five of Queen Margaret’s students now comes from outside the EU, and it is also expanding its overseas programme offer, which already sees courses delivered in Greece, India, Nepal, Saudi Arabia and Singapore.

With 820 years of collective academic excellence to export to the world, Edinburgh enjoys a truly privileged position in the evolving story of academic globalisation and the commercialisation of world-class research and innovation. If he were still around today, Senator Moynihan would no doubt agree – a world-class city indeed.

For further information www.investinedinburgh.com