As Theresa May prepares to unveil her industrial strategy, is it doomed to fail?

Theresa May Leaves Downing Street For PMQ's
Like many before her, today’s Prime Minister thinks government can shift the market in more “balanced” directions, says Shackleton (Source: Getty)
Len Shackleton, professor of economics at the University of Buckingham, says Yes.

Following Mrs May’s flying visit to tell Davos businesspeople what she thinks other people think of them, she now returns to the theme of industrial strategy. Like many before her, today’s Prime Minister thinks government can shift the market in more “balanced” directions. There is always a tension in the sort of industrial policy Mrs May seems to favour between the visionary future and the humdrum present. The hope – every time – is that governments can identify and support future winners. The reality too often is that today’s begging-bowl regions form an unholy alliance with fantasy-inspired widget salespeople to siphon off poorly-monitored government funding to support iffy projects with vague outcomes. If I misread her intentions and Mrs May means to lead a genuine attempt to reduce the obstacles to business – excessive regulation, planning controls and an absurd tax system – she will stand a better chance of boosting growth and productivity. But she is a canny politician: her chosen pitch probably demands showy gestures and big projects rather than sensible policies.

Rupert Myers, barrister and writer, says No.

Prime Minister Theresa May has so far managed to project confidence in the UK’s economic future, while setting out a vision for Brexit which few could seriously argue with, given the lack of any credible alternative. In this high-stakes environment, it’s not surprising that parts of the economy like the banking and manufacturing sectors are jittery about Britain’s future without membership of the Single Market. May’s industrial strategy must provide support and freedom to business. Pragmatic optimism in the UK economy is essential. Of all the available figures who might be leading the country, and shaping a strategy to protect British industry, May stands above the other options. Some will argue that “picking winners” is a failed concept, but there’s no need to repeat the mistakes of past strategies. Investment in education, business deregulation, and a government keen to ensure frictionless trade with the EU are essential, but only a woeful pessimist would claim that our industrial strategy is doomed to fail.

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