National Policy in a Global Economy: How Government Can Improve Living Standards and Balance PDF
Preview National Policy in a Global Economy: How Government Can Improve Living Standards and Balance
National Policy in a Global Economy DOI: 10.1057/9781137473059.0001 Other Palgrave Pivot titles Barend Lutz and Pierre du Toit: Defining Democracy in a Digital Age: Political Support on Social Media Assaf Razin and Efraim Sadka: Migration States and Welfare States: Why is America Different from Europe? Conra D. Gist: Preparing Teachers of Color to Teach: Culturally Responsive Teacher Education in Theory and Practice David Baker: Police, Picket-Lines and Fatalities: Lessons from the Past Lassi Heininen (editor): Security and Sovereignty in the North Atlantic Steve Coulter: New Labour Policy, Industrial Relations and the Trade Unions Ayman A. El-Desouky: The Intellectual and the People in Egyptian Literature and Culture: Amāra and the 2011 Revolution William Van Lear: The Social Effects of Economic Thinking Mark E. Schaefer and John G. Poffenbarger: The Formation of the BRICS and Its Implication for the United States: Emerging Together Donatella Padua: John Maynard Keynes and the Economy of Trust: The Relevance of the Keynesian Social Thought in a Global Society Davinia Thornley: Cinema, Cross-Cultural Collaboration, and Criticism: Filming on an Uneven Field Lou Agosta: A Rumor of Empathy: Rewriting Empathy in the Context of Philosophy Tom Watson (editor): Middle Eastern and African Perspectives on the Development of Public Relations: Other Voices Adebusuyi Isaac Adeniran: Migration and Regional Integration in West Africa: A Borderless ECOWAS Craig A. Cunningham: Systems Theory for Pragmatic Schooling: Toward Principles of Democratic Education David H. Gans and Ilya Shapiro: Religious Liberties for Corporations?: Hobby Lobby, the Affordable Care Act, and the Constitution Samuel Larner: Forensic Authorship Analysis and the World Wide Web Karen Rich: Interviewing Rape Victims: Practice and Policy Issues in an International Context Ulrike M. Vieten (editor): Revisiting Iris Marionyoung on Normalisation, Inclusion and Democracy Fuchaka Waswa, Christine Ruth Saru Kilalo, and Dominic Mwambi Mwasaru: Sustainable Community Development: Dilemma of Options in Kenya DOI: 10.1057/9781137473059.0001 National Policy in a Global Economy: How Government Can Improve Living Standards and Balance the Books Ian Budge Emeritus Professor of Government, Department of Government, University of Essex, UK with Sarah Birch Chair of Comparative Politics, School of Social and Political Sciences, University of Glasgow, UK DOI: 10.1057/9781137473059.0001 © Ian Budge with Sarah Birch 2014 Softcover reprint of the hardcover 1st edition 2014 978-1-137-47304-2 All rights reserved. No reproduction, copy or transmission of this publication may be made without written permission. No portion of this publication may be reproduced, copied or transmitted save with written permission or in accordance with the provisions of the Copyright, Designs and Patents Act 1988, or under the terms of any licence permitting limited copying issued by the Copyright Licensing Agency, Saf ron House, 6–10 Kirby Street, London EC1N 8TS. Any person who does any unauthorized act in relation to this publication may be liable to criminal prosecution and civil claims for damages. T e authors have asserted their rights to be identif ed as the authors of this work in accordance with the Copyright, Designs and Patents Act 1988. First published 2014 by PALGRAVE MACMILLAN Palgrave Macmillan in the UK is an imprint of Macmillan Publishers Limited, registered in England, company number 785998, of Houndmills, Basingstoke, Hampshire RG21 6XS. Palgrave Macmillan in the US is a division of St Martin’s Press LLC, 175 Fif h Avenue, New York, NY 10010. Palgrave Macmillan is the global academic imprint of the above companies and has companies and representatives throughout the world. Palgrave® and Macmillan® are registered trademarks in the United States, the United Kingdom, Europe and other countries. ISBN: 978–1–137–47305–9 PDF ISBN: 978-1-349-50133-5 A catalogue record for this book is available from the British Library. A catalog record for this book is available from the Library of Congress. www.palgrave.com/pivot doi: 10.1057/9781137473059 Contents Introduction 1 1 A British Economy? Boxing with Shadows 6 2 Globalization and Its Efects 28 3 What National Governments Can and Can’t Do Well 42 4 Providing Citizen Support 53 5 Paying for Support 63 6 Focusing on Action: A Model Manifesto 80 7 Putting Policies into Practice 92 Bibliography 104 Index 108 DOI: 10.1057/9781137473059.0001 v DOI: 10.1057/9781137473059.0001 Introduction Abstract: Tis introduces the themes of the book, previews the main argument and provides a guide to subsequent chapters, outlining the case for a radically diferent approach to economic policy. Budge, Ian with Sarah Birch. National Policy in a Global Economy: How Government Can Improve Living Standards and Balance the Books. Basingstoke: Palgrave Macmillan, 2014. doi: 10.1057/9781137473059.0002. DOI: 10.1057/9781137473059.0002 National Policy in a Global Economy Te integration of national economies into a unifed global one has vastly reduced national governments’ power to shape their own economy. Te diverse economic activities which take place on their territory are shaped by independent international institutions and technical developments beyond their control (the advent of digital technologies, improved mineral extraction, new antibiotics and materi- als, three-dimensional ‘printing’ of artefacts). A major problem with political parties and governments is that they continue to debate policy as though there is a national economy which they can ‘build’. Tis is fundamentally a political conception, not an economic one, though it has profound implications for the way in which economic problems are understood and addressed. Tis concentration on what are at best marginal interventions, and at worst inefectual and resource-wasting policies, obscures what govern- ments can do with the powers at their disposal. Tat is improving other areas of life within and for their own territory. Once accepted that economic growth and development are – like weather – surrounding conditions that are largely beyond the control of politicians in individual countries, a major constraint on internal policy-making is removed. With this realization government should be free to decide on policies based on their immediate contribution to the common good and not in terms of their hypothetical (but in reality unknown) consequences for medium- and long-term economic performance. A major example is fscal policy. It is ofen argued by economists and politicians that taxing multinational companies realistically will cause them to pack up and go elsewhere. Once governments accept that multi- nationals will make decisions on many other grounds, we can challenge this alleged constraint on their own actions. Distributor companies will not wish to lose a major market; factories cannot be abandoned without cost; good infrastructure is hard to ignore; cash-strapped governments elsewhere will follow the precedent, levelling the international playing feld. Te same goes for other policy areas such as health, welfare, educa- tion, culture, sport and so on. Policies in the United Kingdom should be driven by their own merits – not because action will have hypotheti- cal economic benefts. Making the country a better place will no doubt make it more attractive, economically, in the long term. But this should not be the policy’s main justifcation, as business moves are so uncertain. Other European governments have already adopted such self-justifying DOI: 10.1057/9781137473059.0002 Introduction strategies with considerable success, and Britain would be well-advised to follow their lead. Breaking the link between national policy-making and economics should be immensely liberating for governments and benefcial for citi- zens. Charting fscal policy by what you need to pay for, rather than fear of imagined consequences, provides more stability internationally and makes other benefts possible – and balances budgets, as is only prudent in the face of unpredictable global change. Tis is the gist of the book’s argument. It aims to develop a radical alternative to the conventional thinking of all the main parties, also prop- agated by many political and economic commentators. Tis alternative is underpinned by our analysis of current trends. But the argument cannot be altogether constrained by these trends as its purpose is to suggest other ways of tackling them. Tus when we suggest a social partnership rather than the non-negotiable stance taken by most governments at the present time, we are pointing to alternatives freed from Keynesian or even neo-liberal economics based on the myth of a controllable national economy. Britain will be used as the prime example in the book, though the analysis applies in a wide variety of contexts (except possibly the United States – the one reasonably autonomous national economy in the world). Te separate chapters develop these points in more detail, starting in Chapter 1 with our current situation and the way it has been interpreted by economists and politicians, media commentators and reporters. Te chapter expands on our analysis, arguing that the ‘national economy’ has little meaning other than as the government’s (potential) tax base. Peculiarly, economic analysis and discussion has adopted a political rather than an economic defnition of an ‘economy’, and we ought to recognize this and follow through on its implications. In Chapter 2 we review the scholarly literature on the phenomenon labelled ‘globalization’, which has ended national economic autonomy. We assess evidence on its nature and efects, before looking at the impli- cations of a globalized economy for recent economic developments in Britain. Tis brings us on to Chapter 3, ‘What National Governments Can and Can’t Do Well’, which reinforces the point that government has little infuence over the level of economic activity on its territory, given globalization. It is still the major economic actor there but not a dynamic one. What it can do is see to the well-being of its population DOI: 10.1057/9781137473059.0002
The list of books you might like
