Think tank attacks May’s industrial strategy for belief that Tories can pick winners

Last Updated: January 23, 2017By

Theresa May’s reaction when she heard the IEA had criticised her new industrial strategy – or at least, a close approximation of how it may have appeared.

What’s this? The IEA – a major Tory think tank – turning on Theresa May because of her industrial strategy?

The Conservative family is at war, folks.

Still, you should expect this kind of behaviour from free-marketeers like the mob at the Institute.

They believe that the role of government is to stay out of business in every respect other than making sure that nothing gets in the way of profit – see the, frankly barking, list of demands below, most of which would kill the UK economy stone dead, as matters stand at the moment.

But they are right to criticise Theresa May. Her plan is equally mad, as This Site made clear yesterday (January 22).

I like Paul Mason’s reaction to this:

The United Kingdom needs leadership, not gimmicks. But gimmicks are all these clowns have got.

While political pressures mean that the revival of interest in industrial strategy is understandable, it is not clear that the sectorally-based policies being suggested are fundamentally different from those proposed in the past.

Governments are still likely to be tempted to intervene for narrowly political motives and it is still assumed that governments possess insights which the private sector is denied.

The UK’s economy and its population would be better supported by a revival of ‘horizontal’ rather than ‘sectoral’ strategy, concentrating on boosting competition, relaxing planning controls, liberalising energy, deregulating markets and promoting tax reform. The government should also eschew protectionism and excessive restrictions on immigration.

Source: Balancing the economy: The hand of government or the invisible hand? – Institute of Economic Affairs

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2 Comments

  1. Barry Davies January 24, 2017 at 1:49 pm - Reply

    The UK’s economy and its population would be better supported by a revival of ‘horizontal’ rather than ‘sectoral’ strategy, concentrating on boosting competition, relaxing planning controls, liberalising energy, deregulating markets and promoting tax reform. The government should also eschew protectionism and excessive restrictions on immigration. Sounds like something direct from the eu, other than they have excessive restrictions on non eu migration.

    • Mike Sivier January 24, 2017 at 1:57 pm - Reply

      You’re completely wrong. It’s more like something out of the neoliberal playbook The Road to Serfdom, by Friedrich Hayek, the man whose nonsense theories formed the basis of Margaret Thatcher’s disastrous policies.
      Hayek was never part of the EU, having moved to the UK and then the US before it was formed/before we joined.

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