To understand “Manchesterism”, Burnham’s book Head North is a good place to start. In it, he describes watching Boys from the Blackstuff, a 1980s BBC drama about life on the dole during the Thatcher years in Liverpool. He recalls the impact it had on his mother, who had tears streaming down her face as they watched an old docker on the show reminisce about the former glory of the Liverpool seafront. For Burnham, the show “remains one of the most powerful depictions ever made of the desperation and loss of dignity that comes with unemployment.”
Deindustrialisation is the origin story for much of modern Britain. It is impossible to understand our country’s condition – particularly the estates on the outskirts of big cities, and the ex-industrial towns and villages – without grasping this. For all the attention given to the Red Wall and “left behind” in recent years, there has been far too little discussion of deindustrialisation, which is almost always the root cause of pain.
While British industry started to decline in the 1950s, it wasn’t until Thatcher’s reckless monetarist experiment in the 1980s that things fell apart. As the economic historian Jim Tomlinson describes, “the rate of job loss in such a short period in the early 1980s was extraordinary and was a key feature of the history of Britain in this period with long-term consequences.” This had deleterious effects for industrial areas: wages collapsed, jobs were lost and as prosperity moved out, social problems moved in. The scarring effect of this has lasted decades, with ex-industrial areas today too often enduring appallingly unjust outcomes, from health to education.
The tragedy is that while some degree of deindustrialisation was inevitable, the scale and extent of ours certainly wasn’t. Many of our competitor countries retain bigger manufacturing bases and much more heavy industry. As Sacha Hilhorst has argued, it might be better to consider ex-industrial towns as “actively remade” rather than “left behind”.
This wasn’t a natural process. Instead, it was actively driven by bad ideas. One was that people should “get on their bike” and move to areas of higher employment. However, as the Nobel Prize-winning economist Esther Duflo has shown, people are “sticky” and moving is extremely difficult to achieve, even with significant economic incentives. What’s more, the outcomes for people that do move are often very poor, partly because of a loss of social networks. Another bad idea was that the replacement of manufacturing jobs with an “information economy” would expand economic opportunity; the idea being that, in a “log on” economy, it wouldn’t matter where you logged in from. In fact, our services-dominated economy is much more geographically concentrated than our more balanced economy of the post-war years, partly due to the agglomeration effects that reward economic clustering. As we have embraced an intangible economy, the tangible matters more than ever before.
The uncomfortable truth is that not only did this process continue under New Labour, but it arguably intensified. In government, the party too often assumed deindustrialisation was inevitable; like the changing of the seasons, there was little that could be done about it. This collapse of interest in industrial policy means that Labour has been left without the intellectual resources to capitalise on today’s global moment. A time when the new “age of insecurity” has led to a “new economic nationalism”; with governments around the world doing what they can to boost national production and reindustrialise. It turns out globalisation wasn’t like summer following spring, but in fact – like other political and economic paradigms – a temporary phenomenon.
Sadly, as is often the case with the British establishment, we remain behind the curve. Just as in the 1930s our economic establishment remained wedded to orthodox economics, trying to balance budgets instead of spending, today our economic orthodoxy remains wedded to the “services-dogma”. This is the idea that any attempt to revive industry or manufacturing is inherently backwards looking, largely because the UK has its biggest strengths in things like financial services. But this is precisely the point. The UK has doubled down on services for decades – meaning we have doubled down on the Greater London economy, with little else to show for it. This is before even considering the enormous national security concerns that stem from our extreme case of deindustrialisation; our inability to make the things that keep the lights on, that keep our military supplied and our nation safe.
That is why it is so welcome to hear increasing talk of the need to reindustrialise. Yet it remains a relatively underdeveloped element of “Manchesterism”, particularly in comparison to its critique of privatisation. Yes, the mayor of Manchester can point to exciting work happening in Atom Valley in Greater Manchester. But as the analyst Rian Whitton has pointed out, industrial sectors have not powered Manchester’s recent economic improvements. What would an “industrial Manchesterism” demand?
First, a new industrial strategy worthy of that name. Too much of our current industrial strategy is focused on services, particularly of a high-end variety, such as banking and law. Given their concentration in London, the South East and a small number of “core cities”, our industrial strategy fails to be a national industrial strategy. It needs to be updated with a much clearer focus on industry and manufacturing, supported by a new target to increase their share of Britain’s GDP.
Second, an overhaul of procurement rules. Governments spend hundreds of billions; directing more of that to domestic suppliers, particularly when purchasing manufactured goods, is a no brainer. Indeed, everywhere but Britain it seems, governments are developing nationalist purchasing agendas, from the longstanding and deeply embedded “Made in America” programme, “Made in Europe” agenda or Carney’s “Canada Strong” agenda. Surely the genuine return of “Buy British” is not too much to ask?
Third, rebuilding “UK PLC”. Deindustrialisation has been accelerated by the flogging of our industrial base to the highest foreign bidder. The mess we have got ourselves into over British Steel is exemplary – first sold to India’s Tata, then the Chinese, and now rightly taken back under public control by the government. If Manchesterism is serious about reindustrialisation, it must extend its interest in the ownership of utilities to the extent of foreign ownership in sectors of the economy which will remain privately owned.
These changes will not be easy to deliver. We need to increase government spending on manufacturing and industry subsidies, requiring tax rises or spending cuts. We need to increase tariffs to protect British industry, which will raise prices for consumers. We need pension funds to invest more in Britain, meaning potentially lower gains in the short run, instead of chasing the maximum global return.
It will mean confronting the many enemies of reindustrialisation. All those that have benefitted from the last 40 years will cry foul. Orthodox economists and think tanks, wedded to our current economic model, will claim that there is no alternative to Britain’s current broken model. Their outriders in the media will run endless attacks: how this is a return to “British Leyland” or the white elephants of past industrial policy, such as Concorde.
Winning this battle won’t be easy, but there are alliances to be built. In Labour, support for reindustrialisation can be found in every single faction or grouping, from the old Labour right in Labour First to the far-left’s Socialist Campaign Group. From the small-c conservative Blue Labour to the soft left in Tribune and Mainstream, the latter being closely associated with Burnham, and of course the Red Wall Group. Much of the trade union movement too is fighting hard to protect what exists of our industrial base, and to make sure that we use government spending to reindustrialise. I also think the public are up for a fight. They are appalled by the extent to which so many of our once mighty industrial towns have decayed; disgusted by the lack of productive opportunities for young people in this country; terrified by our reliance on other countries for our raw materials and supplies. If that energy is seized, who knows what is possible. While we can’t rewrite the script of Boys from the Blackstuff, we can start to correct historic injustices across our former industrial heartlands. We owe these places nothing less.
[Further reading: Andy Burnham’s manifesto for change]
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