British scientists are hopping mad about comments from Bank of England Governor, Mervyn King, who recently argued against increased science funding, presumably on the grounds that all the money had already been spent on health and safety agencies, totally ineffective government agencies and bailing out Scottish Banks. I would expect the Governor of the Bank of England to understand a little bit of basic economics and that economic growth has always come from technology (think of the Industrial Revolution which created the British Empire) rather than bulldozing money into a pit and setting fire to it. I think I’m hopping mad too.
With lunatics like this running the asylum its hardly surprising the UK economy is in its present state.
Sir Roy Anderson, rector of Imperial College is being firmly diplomatic rather than hopping mad, and calling for a £1bn venture capital fund to support small high technology companies, an ideas as insane as Mervyn Kings. For all the whinging about the UK venture capital industry, it’s not too bad. It’s not Silicon Valley but it’s much better than most of the rest of the world. However, like their UK counterparts it doesn’t work too well, and shovelling yet more public money into another lame duck industry won’t do any good either.
It’s hard to believe that the finest minds in the country can’t come up with a better idea for an economic stimulus package than chucking loads of public money at things that don’t work. Putting their underpants on their heads and shouting at the traffic would have as much effect and be a lot better value for taxpayers.
Despite its recent woes, there is enough liquidity in the VC industry to continue doing what it does, but what it doesn’t do is invest in early stage technology companies. In fact not many people do and that’s where the money really needs to go, to support early stage companies and get them to the stage where they can attract further capital from customers, banks or even VCs.
As I wrote in February, Let a Million Flowers Bloom!
Given that the returns on most asset classes are now negative, entrepreneurs are one of the few places where some wisely invested cash will give a decent return. Imagine what would have happened if governments had refused to bail out the banks and put the cash into technology, entrepreneurs and small businesses instead? We’d still be a few hundred billion in the hole, but at least there would be some chance of getting some of it back and stimulating the overdue reinvention of the economy.