Comments: Industry on a slow boat to China

Itís interesting that Mr. Saundersí view on whatís needed to keep Britain competitive includes two factors controlled by government, taxes and regulation, but doesnít include interest rates.

Surely itís obvious that adjusting interest rates cannot solve all Britainís economic problems. Isnít it time to accept that conflicting objectives such as helping manufacturers export and discouraging excessive consumer borrowing need tax changes, not rate changes?

The media have been too soft in not holding Gordon Brown to account for his failure to use taxes to meet growth objectives. Creating wealth is as important as eradicating poverty. So how is it that Mervyn King holds an economic press conference every quarter but not Gordon Brown? Has Gordon refused or have the media just not challenged him?

And if services are so important to the UK, how is it that Peter Mandelson can keep Chinese imports out of Europe but he canít allow UK service companies to trade across Europe? Donít Belgians have the same right to cheap pet insurance as the British?

But there is one answer to all Britainís economic problems: build lots of houses - hundreds of thousands of spacious, light, efficient family homes. Tear up the Green Belt rules, tax failure to develop brown-field sites and put builders under the control of architects, not council planners. Itís time - bring on the bulldozers.

Posted by David Sandiford at August 28, 2005 11:00 AM

Just a thought: those Chinese goods stuck at the docks are probably the retailersí autumn Ďnew linesí that they want on the shelves for the start of the new season Ė traditionally, September. Retailers usually raise prices in September because of the new stock. But what will happen this year? Will the new lines not arrive and retailers will have to keep summer stock at low prices? Or will retailers have a limited amount of autumn stock and decide to jack up prices accordingly? This could play havoc with the inflation figures.

Posted by David Sandiford at August 30, 2005 10:45 AM