The electric age: the answer to Western political and economic stagnation

The west is making everything look difficult. Economic growth is tepid or non-existent, productivity is poor, politics is increasingly populist rather than constructive and, as a result, the challenges are mounting up. The answer, as in previous such periods in the past, is to set a bold new course that unlocks new value and that our populations can get behind. Because it ticks so many boxes, that course must be to create a new electric age.

There are times of change and times of continuity, with each leading themselves to a different politics, the private sector being particularly good at motoring us through periods of continuity and the state needed to steer a new course when that’s required. Take away a left-right prism and we can see that when change is required, it’s timely government intervention capitalising on an opportunity that makes the difference, not ideology. We are currently ripe for a period of government-backed change and yet are, instead, stagnating in inaction.

Some examples. When it was recognised railways would play an important role in transforming Britain and boosting our role in the industrial revolution, the state backed them by gifting the land they would sit on. This had its opponents from those who wanted the uk to continue deriving it’s wealth from farming, but we would be a much poorer country if they had had there way. Luckily they did not, and our industrial transport network made manufacturing and trading possible on a new scale, creating new value. Similarly, when the power of the state had been demonstrated by fighting two world wars and, after the Second World War it was clear that home and not empire was the UK’s future, the state invested in its people through public services and infrastructure. This boosted the productivity of the workforce and created new customers. As part of Britain and the US pushing a new period of globalisation, banking deregulation opened up new opportunities and, alongside this, the UK’s investment in North Sea gas extraction softened the shocks of economic restructuring. On the other hand, through the post-war consensus and, separately, in 1990s and 2000s, the models in place worked and the private sector was rightfully allowed the to set the direction, advising governments of what regulations and partnerships would keep the country going.

Since the economic crash and perhaps before, we’ve been in a Malthusian stupor, wondering how we will survive on the finite value at hand. The consensus on climate change has added to negativity, creating a sense that, even if new opportunities are to be found, they will also hasten our ecological demise and, alongside this, we will somehow need to afford a shift to green infrastructure. Despite an opportunity for change staring at us in the face - creating new economic value from a plug and play electricity network, cheap and clean wind, sunlight and electric-powered machines - we have not grasped it and, as a result populism or the politics of ‘everything is too difficult’ has rapidly gained ground. In fact, it’s hard to think of another essential part of our economy or infrastructure where we have chosen to keep using a lot of the old stuff, rather than take advantage of new technologies.

Why have governments failed to create this new opportunity and, instead, stuck for so long with outdated technologies? One could argue it’s the scale of change needed or that there are other big changes coming alongside it such as AI and biotech that cloud the picture; perhaps we have become unsure of ourselves because we are threatened and confused by China’s growth, or worry about making bad quick decisions in an effort to get off Russian hydrocarbons; or maybe it’s because we see these technologies as regrettably expensive solutions for climate change rather than positive enablers in themselves. It could also be because the changes delivered in our recent history have been understood through a left-right lens and, as a result, we are looking for answers in our preferred political camps while populists drive a wedge between sensible politicians and the public.

To end our economic and political stagnation we must lift ourselves out of this intellectual morass and focus on our only viable goal: unlocking new, productive value by embarking on the electric age. Thought leaders must help the country imagine a future in which:

• new jobs, skills, manufacturing, and civil engineering techniques are developed to create a new, high capacity energy network across the country

• the whole nation gets a plug and play energy network, enabling businesses and communities to easily add energy generation and usage where they want it, such as new wind farms and fast electric charge points

• innovators develop new technologies for generation and usage, such as vertical farming, with the confidence of an easily accessible infrastructure to tap into

• consumers get access to increasingly cheap electricity, made from sunlight, wind, nuclear and other clean sources

• communities can build resilience and new income streams by establishing local generation networks

• internet connections are upgraded while our roads and fields are dug up

• towns and cities get smarter, building integrated infrastructure that’s in sync with citizens and the environment

This new opportunity stands before us at the very time our overly service-based economy is failing on both productivity and growth grounds, when the trade in gas, oil and coal is becoming more expensive and unpredictable, and when we have seen the latest in a longline of ‘levelling up’ policies fail. These problems will only get more acute as the population ages, especially if we continue to curb immigration.

So, what’s the answer? We have a destination but our politics appears distracted and unable to focus on it. Why have we become the equivalent of the farmers looking at the industrial revolution with fear rather than imagining ourselves as the technology pioneers? We should turn to those pioneers of the past and, like them, rather than seek to explain what will happen in thirty of fifty years, which is impossible as the world is too complex and the electorate will not buy, make the case for substantial interventions to capitalise on opportunities now and, by that, inch towards a better future. For example, rather than having a left-right argument over the merits of onshore wind farms versus whether they spoil the scenery, are too intermittent or too loved by eco-campaigners, let’s have a debate about how useful they would be right now, let’s agree that building them would create skills and jobs now, let’s agree that if a better technology emerges we will switch to that instead rather than worry about permanence, and let’s agree the state needs to play a role in making them happen. Once they are up, let’s discuss what’s next. Similarly, if this change needs up front government investment which can only be afforded through a wealth tax, let’s do that. Or if, instead, a framework can be created that incentivises corporations to deliver what’s needed directly, that could work too. Neither mean we need such a tax or a regulated public-private partnership forever or we have an ideological love of either, just that we need to raise or leverage some money now for investing now.

Let’s move away from a politics of left-right and towards a national consensus we can all get behind. Let’s move away from a tax or redistribution-first debate, and towards one of agreeing what we need to build our future, and how we will fund it, especially building that future will create valuable jobs across the country and put more value in community hands. Let’s not claim we have all the technological answers but instead create a new platform for the innovators to innovate. Let’s be the Victorians excited by the opportunity of the railways rather than worrying how much they will cost or whether they make the countryside look different.

Let’s stop wasting time and get on with our new electric age.