Posts Tagged ‘University of Sheffield’

Lobster on the Economic Damage Caused by the Financial Sector

November 22, 2019

Lobster over the years has criticised the dominance of the financial sector over the British economy, and attacked the way this has actively harmed other sectors, particularly manufacturing industry. Thatcher, Major and then Tony Blair favoured banking and financial services over the industries, partly from economic illiteracy and partly from the conviction that Britain’s manufacturing sector was doomed. Thatcher believed very much in a strong pound and didn’t think it would harm the manufacturing industries. One of the few businessmen from that sector in Thatcher’s government tried to tell her otherwise, and show her that it would damage our exports by making them too expensive over our competitors. But Thatcher wouldn’t hear of it. She was convinced that it wouldn’t have any effect on manufacturing because the Germans had a strong manufacturing base, and they had a strong Deutschmark. The businessman tried to explain to her that the Mark was strong because they had a strong manufacturing base, not the other way around. But it was too much for the Leaderene’s brain and she refused to listen.

Thatcher also made it very clear that she was not going to help failing industries. What help there was, was supposed to come from the privatisation of state utilities and the operation of market forces. This was supposed to open up new forms of private investment. If they didn’t, then that company or industry was uncompetitive and doomed to fail. Meanwhile, the thinking went that the financial sector would take over from the failing manufacturing industries as a new source of wealth and employment. Thus Blair, Brown and the late Mo Mowlam opened up the ‘prawn cocktail’ campaign to win over the City of London, promising light regulation. One of the chief executives at the Bank of England, imported from America, was Deanne Julius, who said that Britain should abandon its manufacturing industries and allow them to be replaced by America’s. Instead, Britain should concentrate on the service industries.

This is another load of neoliberal economic rubbish that has been conclusively proved wrong. The Oxford economics professor, Ha-Joon Chang, in his book 23 Things They Don’t Tell You About Capitalism shows that despite Thatcherite dogma, manufacturing is still crucially important for the British economy. It only looks weaker than the other sectors, because it has grown at a slower rate.

Now Robin Ramsay in the latest update to his ‘News from the Bridge’ column in Lobster 78 has published a piece actually describing the active harm the privileged position of the financial sector has done the British economy as a whole. It’s in a piece ‘The Future of Britain’s Crisis’, which begins with a few sharp observations about the impotence of the House of Commons Security and Intelligence Committee. This is supposed to supervise Britain’s intelligence services, but its lack of effective power is demonstrated by Johnson’s suppression of the report into Russian influence in UK politics. From leaks to CNN and others, it shows that rich Russians have purchased UK citizenship and poured money into Tory coffers. He states that this is just part of the price Britain has to pay for Britain being one of the leading centres of money laundering. He continues

The idea that there is a structural conflict between the interests of the manufacturing economy and that of the City has been around since the late 1970s in my experience, and probably much longer. The conflict was rarely articulated by public figures beyond the British left but in 1980, with Bank of England base rates lifted to 14% ‘to control inflation’, Sir Terence Beckett, director-general of the Confederation of British Industry (CBI), told its annual conference that they had to ‘to take the gloves off and have a bare-knuckle fight’ with the Thatcher government. But no such fight ensued, Beckett resigned and in the following decade while the City boomed, British manufacturing shrank by about 20%.

The focus these days is less on structural conflict than on what is known as ‘over-financialisation’: roughly, that the financial sector gets to be too big for the rest of the economy. Recently a trio of economists/econometricians (from the Sheffield Political Economy Research Institute at the University of Sheffield) have tried to quantify the cost of UK over-financialisation and have concluded:

‘Our calculations suggest that the total cost of lost growth potential for the UK caused by “too much finance” between 1995 and 2015 is in the region of £4,500 billion. This total figure amounts to roughly 2.5 years of the average GDP across the period.

The data suggests that the UK economy, may have performed much better in overall growth terms if: (a) its financial sector was smaller; (b) if finance was more focused on supporting other areas of the economy, rather than trying to act as a source of wealth generation (extraction) in its own right.

This evidence also provides support for the idea that the UK suffers from a form of “finance curse”: a development trajectory of financial overdependence involving a crowding out of other sectors and a skewing of social relations, geography and politics.’ [Emphases in the original.] 

On similar lines, Grace Blakeley writes in her On Borrowed Time: Finance and
the UK’s current account deficit, that

‘Rebalancing the UK’s international position requires moderating the significance of finance within the UK economy and bringing asset price volatility under control, while nurturing non-financial exporting sectors.’

Ramsay concludes the article by remarking that it would be a difficult job convincing the political establishment of this, never mind the electorate. The failure of people working within London to understand that the capital’s influence and share of the country’s wealth is harming the rest of the country has helped the rise of the Scots and Welsh Nationalists, along with less significant movements like the Yorkshire Party, the Campaign for the North and Mebyon Kernow.


£4,500 billion lost to the British economy between 1995 and 2015! 

And never mind the millions of jobs lost, the destruction of working class communities right across the country from Cornwall to Scotland and Northern Ireland, lost skills and damaged lives!

All that simply so that Thatcher’s, Blair’s, and now Boris and Rees-Mogg and their chums in the City of London could make a tidy profit.

This is proof that we need a Corbyn government that will do something for public services and manufacturing industry, rather than more of the self-serving Tory economic policies that benefits only the City.

Have Scientists from Sheffield University Found Life from Outer Space?

September 19, 2013

A team of scientists from Sheffield University believe that they may have discovered extraterrestrial life. According to this story on MSN News a group from the University’s department of molecular biology and biotechnology under Professor Milton Wainwright sent a balloon 27 km up into the stratosphere during the recent Perseid meteor shower. The balloon was launched from Chester and came down near Wakefield. The balloon carried microscope studs, which were set to open between 22 and 27 km above the Earth. To ensure that the results were not contaminated by organisms from the Earth’s surface, the equipment was sterilised before it was launched.

When it returned, it was found that the studs had collected a variety of microscopic organisms. Some were diatoms, a form of algae, along with more unusual life-forms. Prof Wainwright said “It is generally accepted that a particle of the size found cannot be lifted from Earth to heights of, for example, 27km. In the absence of a mechanism by which large particles like these can be transported to the stratosphere, we can only conclude that the biological entities originated from space. Our conclusion then is that life is continually arriving to Earth from space. Life is not restricted to this planet and it almost certainly did not originate here. If life does continue to arrive from space then we have to completely change our view of biology and evolution. New textbooks will have to be written!”

Disease Space

The team’s finding appears to corroborate the highly controversial views of the origin and evolution of life on Earth of the late Sir Fred Hoyle and his colleague, Professor Chandra Wickramasinghe. Panspermia is the theory that life originated in space and later colonised Earth. It was first put forward in the 19th century by the Swedish astronomer, Svante Aarhenius. In the late 1970s and early ’80s Fred Hoyle and Chandra Wickramasinghe wrote a series of books Lifecloud (London: Dent 1978), Diseases from Space (London: Sphere 1979) and Evolution from Space (London: J.M. Dent 1981), reviving and expanding the theory. They suggested that not only had life come to Earth from space, but that it was viruses and bacteria continued to arrive from space to infect humans and another creatures here on Earth.

Most controversially, they suggested in the last book that Darwin’s theory of evolution was inadequate to explain the evolution of the Earth’s creatures. They argued that the process of evolution was actually too rapid to be cause by what they viewed as they slow processes of Natural Selection operating on random mutation. They considered instead that evolution was actually driven through viruses and other genetic material entering and mutating terrestrial organisms from space. More speculatively still, they suggested that the seeding of such genetic material on Earth was done deliberately by advanced extraterrestrial civilisations. They suggested that these would artificial, machine intelligences from another cosmos in the multiverse. Their theory that evolution has been consciously directed is extremely similar to Intelligent Design, proposed and supported by the mathematicians and scientists William Dembski and Michael Behe. Most of the supporters of Intelligent Design are religious, and the theory has been severely attacked as a form of Creationism.

Evolution Space

This is not the first time a scientific balloon has returned from the stratosphere containing what was suggested was extraterrestrial microbial life. A few years a balloon sent up by scientists in India returned to Earth with red slime. Like Prof Wainwright, the Indian scientists believed this material had been collected from too high an altitude for it to have come from the Earth. They came to the conclusion that it must therefore have come from space. Fred Hoyle died twenty or so years ago in the 1990s. The media did contact Chandra Wickramasinghe, who was then working at Cardiff University, if I recall correctly. Prof Wickramasinghe was delighted that there was now further evidence to support his and Sir Fred’s theory.

Meanwhile, Prof Wainwright’s team intend to repeat the experiment in October, when there is a meteor shower associated with Halley’s Comet. This will spread further cosmic dust. If the balloon returns again with similar material, it will confirm the team’s theory.

All this is fascinating and highly controversial. I don’t think, however, there’s any remote chance of them finding anything like the horrific extraterrestrial disease in Michael Creighton’s book and film, The Andromeda Strain.