The Economist takes a look at the new industrial policy being proposed by the UK government and concludes that they should stick to providing basic services.
Labour’s new industrial policy is more realistic about what the government can accomplish than the version that prevailed in the 1960s and 1970s. For that reason, it should avoid its predecessor’s fate, which led to the government supporting lame ducks rather than winners. But it still suffers from the illusion that ministers can behave like impresarios, conducting economic development from their podium in Whitehall. And it is the wrong priority.
What business wants the state to concentrate on is providing essential public services such as decent education at an affordable cost. It wants less meddling through burdensome regulations. Above all it is crying out for a credible plan to sort out the battered public finances, so that firms do not buckle under the burden of higher taxation and a surge in interest rates caused by excessive public borrowing. That might not amount to a new industrial policy but it would work a lot better.
Of course if we want to reforge the economy using the whit heat of technology, having properly funded Universities doing properly funded research would be a good place to start.