Manufacturing figures show more weakness

The latest figures for manufacturing show more weakness expected in orders and output.

It’s not just from exports but also from weak domestic demand.

It is a reminder that the tax and inflation squeeze on incomes is hitting demand for manufactured products.

Speculation from the Treasury that they might raise taxes on cars is far from helpful if you wish to stimulate the purchase of new vehicles made in the UK.

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73 Comments

  1. A Different Simon
    Posted June 1, 2012 at 11:52 am | Permalink

    Good . Parliament must be very happy . Manufacturing down , unemployment up . All going to plan then .

    The UK establishment prefers we import everything ; our food , our energy , consumables , durables , our laws , even our Govt .

    If it can’t be printed , imported or flipped they are just not interested .

    • Max Dunbar
      Posted June 1, 2012 at 6:34 pm | Permalink

      You forgot people. We import some 600,000 (officially) of them per year apparently.

      • A Different Simon
        Posted June 2, 2012 at 7:17 pm | Permalink

        Makes me want to despair Max .

        I don’t deny that the majority of them are good but that’s not the point . They should only get in if they are great .

        Europeans , and I include Britons are to human kind what zoo animals are to nature .

        They are a pale immitation which can’t survive in the wild world .

        Sadly I think I think I am giving up and joining them .

  2. Paul Danon
    Posted June 1, 2012 at 12:02 pm | Permalink

    Please could you table a motion to cancel all so-called infrastructure projects and cut taxes so that Britain re-opens for business?

    • Bazman
      Posted June 1, 2012 at 3:21 pm | Permalink

      How is cutting infrastructure projects going to help business? More tax cuts? Fantasy of a fool.

      • lifelogic
        Posted June 2, 2012 at 12:03 pm | Permalink

        Even good infrastructure projects take a long time to make a real return. Most of the ones this government is pushing never give any real return. Things like windfarm, HS2 and the PV Bling nonsense. Cut them all but do the Heathrow/Gatwick 5 runway HS hub airport and some nuclear power now.

  3. Lindsay McDougall
    Posted June 1, 2012 at 12:15 pm | Permalink

    But the Treasury doesn’t wish to see more cars purchased in Britain. No matter what technical improvements and price efficiencies manufacturers introduce, the government (indeed, all governments) deliberately negate them, so that people are forced to use ‘more environmentally friendly’ transport. It depends what your measuring stick is. Modern German made trains are heavier and less environmentally friendly than the old slam door trains. Don’t let the fact they they are electric fool you. Think what is happening at the power station.

    • lifelogic
      Posted June 1, 2012 at 1:38 pm | Permalink

      Train journeys, when considered door to door, including the track, ticketing, stations, staff and, as you say, the electricity production, maintenance, security (with average occupancies) are not very green at all anyway. Neither are bikes or even walking.

      Does any one sensible think that seven people, walking from say London to Manchester and back, over say 6 days with (say 7X18 meals) is more energy efficient than taking a people carrier for 6 hours there and back using say 8 gallons of diesel?

      When all the food energy and food miles are considered. Quite apart from all the time wasted.

      It is just a mad religion, as everyone sensible knows full well. Apart from Cameron, Huhne and the Libdems seems.

      • Bazman
        Posted June 2, 2012 at 10:56 am | Permalink

        The mad religion of believing that people consume the right amount of calories based upon energy expenditure despite all evidence to the eye that Britain is full of fat people? Investigating this ‘scientific’ fantasy for about 20 seconds reveals as a rule of thumb shows that riding a lightweight bike consumes about 35 calories per mile, walking about 100 a car about 1800 calories. Now using this information you could say that after a gut busting 1300 calorie burger meal you could move 37 miles. In a car less than a mile. A 2000 calorie a day diet could move you 57 miles on bike. A car uses 95% of its energy to move the weight of the car Which means only 65 calories are used to move the driver and the energy required to build a car mind boggling. Like your fantasy that that private enterprise would fill the gap left by the state, just silly.

        • lifelogic
          Posted June 2, 2012 at 4:20 pm | Permalink

          You ignore all the energy used in the food production and distribution and the worn out shoes, knees and hips. If food is so efficient they perhaps we need a steak and chips fuelled car!

          The energy used to produce a 1KJ of steak, distribute, freeze and cook it much more than 1KJ.

          Also the wasted time and the car can take up to seven and luggage.

          • uanime5
            Posted June 2, 2012 at 9:17 pm | Permalink

            You ignored all the energy needed to drill for oil and refine it into petroleum. This is vastly more than the energy needed to grow and cook food.

            Also cars with diesel engines can run on vegetable oil and waste oil so a steak and chips fuelled car already exists.

          • lifelogic
            Posted June 3, 2012 at 9:10 am | Permalink

            uanime5

            You say “You ignored all the energy needed to drill for oil and refine it into petroleum. This is vastly more than the energy needed to grow and cook food.”

            No it is not.

            I do not ignore it but food, freezing, packaging, transport, processing, cooking, waste etc. need vastly more energy to produce (especially meats). What % of the food energy fed to the cows actually gets to the end user?

        • lifelogic
          Posted June 2, 2012 at 7:52 pm | Permalink

          Two final points you have missed:

          “A car uses 95% of its energy to move the weight of the car” – This is just pure nonsense at a fairly constant speed (on a main road/motorway) the weight of the car is almost irrelevant to the economy. Only in start stop city driving or hilly driving, is it significant.

          Furthermore were a car designed to go efficiently at a low steady speed (say 20-30mph because walking speed 3-4 mph would be absurd) it would be even more efficient (reduced wind resistance) and could do 200mpg+ very comfortably carrying 7 people.

          So are you saying 2 gallons of fuel is more energy than 76 meals and all the production there off (plus all the hotels night needed). Food is just a very, very inefficient bio fuel and bio fuels are very inefficient and absurd anyway in general. In fact they are “morally repugnant” (as Osborne might say ) when people are short of food and it pushes food prices up so hugely.

          • uanime5
            Posted June 2, 2012 at 9:36 pm | Permalink

            Your post is full of pseudo-science.

            The weight of a car doesn’t become irrelevant because it is moving fast. If two objects of the same shape are moving at the same velocity the heavier object always requires more energy to move it than a lighter one. This is why real scientists are currently trying to make lighter cars so they will have a better fuel economy. You can easily testing this by driving 100 miles in your car, measure the fuel usage, then fill the car with bricks, drive another 100 miles, and measure the fuel usage. You’ll find that the car needs a lot more fuel to move a heavier load.

            Wind resistance increases the faster you go because of Newtons third law of motion (the mutual forces of action and reaction between two bodies are equal, opposite and collinear). So the greater the force the car exerts on the air the greater the force the air exerts on the car.

            There’s little difference between the efficiency of biofuels and petrol. Also biofuels are popular in poor countries because they’re cheaper than oil, especially bioalcohols which can be made from waste food and biodiesel which is made from inedible plants.

          • Bazman
            Posted June 2, 2012 at 9:48 pm | Permalink

            One question lifelogic. How much do you weigh and how tall are you? My main point in my posts is that many continually allow their greed to guide their actions believing the ends justify their means, even though they never have to sacrifice anything themselves. For the record I am 95 kilograms and 185 centimetres in real money. Ram it.

          • lifelogic
            Posted June 3, 2012 at 6:58 am | Permalink

            The weight of a car is not significant “at a steady speed on a level road as I said (it just gives a small amount of extra friction) try it with a car empty and full! Lighter cars save fuel when accelerating mainly in start stop traffic.

            At a steady speed on a level road it might use perhaps 1% more due to extra friction in bearing/tyres – wind resistance is the same or can sometimes even be lower (as the car can be lower on the suspension due to the weight).

          • lifelogic
            Posted June 3, 2012 at 9:13 am | Permalink

            Bazman in real units 5ft 11in and 14 stone – rather too fat I grant you.

          • Bazman
            Posted June 3, 2012 at 9:42 am | Permalink

            At the root of the problem is technology that has improved only incrementally, not radically, since the 1920s. After more than a century of devoted engineering effort, today’s cars use < 1% of their fuel energy to move the driver: only 13% of the fuel energy reaches the wheels, and just 6% accelerates the vehicle, 95% of whose weight is its own, not the driver’s. Two-thirds (or, not counting accessory loads, three-fourths) of the fuel use is caused by the car’s weight (An and Santini 2004), and each unit of fuel saved at the wheels saves an additional seven units of fuel lost en route to the wheels. Obviously, then, the most powerful way to reduce fuel use and emissions of cars is to reduce their mass radically—say, by half.
            And many other papers say the same…
            Wind resistance is not really a factor at low speeds. On high powered motorbikes you can really feel this resistance as the speed increase. Some legislators want speed restrictors to be be on these bikes and the latest ones have, set at 187 mph. My bike is before these agreements and is seen as the last two fingers to the legislators with the 220+ mph speedo. Ironically these bikes are restricted by the brutal laws of physics, but people like lifelogic do not understand this and so to placate the public sense of outrage limiters where fitted. Ram it.

          • lifelogic
            Posted June 3, 2012 at 8:03 pm | Permalink

            @Bazman

            At a steady speed weight is not significant for fuel consumption – as I keep telling you. Ask another engineer if you do not believe me.

            We should be avoiding start and stop driving, pointless traffic lights, bus lanes, bike lanes and other deliberate government road blocks and keep the traffic flowing – smoothly and fuel efficiently.

          • Bazman
            Posted June 4, 2012 at 3:17 pm | Permalink

            At a steady speed weight is not significant for fuel consumption? Where do you get this silly fantasy from? A HGV’s average fuel consumption of 8mpg is considered good when near the maximum 44 tonnes gross weight. This can rise to over 12mpg when running empty. To say that the extra weight uses hardly any more fuel defies the laws of physics and to say on a flat road defies the realities of road building. Small mopeds can achieve 100mpg+ easily in the real world. Guess why? Advanced engine technology? Nope. low weight/power.
            Superbike fuel consumption is about 30-35 mpg which is poor for the size/weight and the price of high power. 175-200 bhp. Supercar mpg less than 20. Reason? Weight/power
            Your pseudo science cannot escape the weight/power equation. Even on a ‘flat’ road at a constant speed. A HGV car, superbike and moped could all use the same amount of energy to cruise. Just silly and to nail this point once and for all riding a heavy mountain bike on the flat takes much more effort than riding a lightweight racing bike on the same flat piece of road. To say their is little difference is pure fantasy. Maybe you could explain why this is so lifelogic? Would it be something to do with weight?

          • Bazman
            Posted June 5, 2012 at 1:56 pm | Permalink

            Probably flogging this one a bit now, but this is how some people view the world so I’ll persist. What lifelogic is saying is fundamentally true. A car traveling at a constant velocity on level ground in a total vacuum with frictionless wheels could travel at any speed without consuming any energy beyond what is needed to get the car up to speed. Hmm.. Sounds a bit impractical to me. A larger vehicle in the real world consumes more power an inescapable fact even in at a constant speed on a flat road for obvious reasons. You cannot hold back the tide with arguments.
            Like your politics lifelogic silly and not real. The frightening thing is that many other people have this ideal view of the world and use it to make others sacrifice things, but not for themselves in areas such as building site safety and the economy.

      • Caterpillar
        Posted June 2, 2012 at 11:47 am | Permalink

        lifelogic,

        While I agree with you that there are many calcualtions that have shown car travel to be more efficient than walking this has tended to assume that walkers eat/drink extra calories for the purpose of the walk, and otherwise would not consume these calories. I don’t think this is the case though; many people overconsume calories (observable by their BMIs being above the already generous recommended guideline) and any walking could be carried out without consuming any additional calories. Moreover (although I am a general free market fan) the market seems to encourage the opposite, supermarkets offer reduced petrol price vouchers based upon grocery spend – your green approach, of cars over walking, could be supported by a policy of reducing gasoline prices for those who eat less and increasing it for those who eat more, to encourage switching from food to gasoline. Whilst I realise you would not want even more government interference it is strange that our individual calorie (joules for younger readers) intake is not part of a government green energy strategy!

        • lifelogic
          Posted June 2, 2012 at 4:25 pm | Permalink

          I do not think:- walkers eat/drink extra calories “for the purpose” of the walk – but that in order to maintain a certain weight they clearly must.

          The energy used has to come from somewhere? If they did not eat more to cover this energy need they would clearly slowly loose weight.

          • Caterpillar
            Posted June 2, 2012 at 11:33 pm | Permalink

            Precisely, they would slowly reduce weight to a different equilibrium (- the 70Kg 2000kcal person might need an extra 50 kcal for a mile (walk not run) so for 10 miles would need another 500 kcal. The sedentary person already on 2500kcal per day would be at a higher equlibrium mass, on walking 10 miles per day he/she would re-equilibriate at a lower mass).

            The point being that extra calories are not needed to walk because they are already consumed (they are stored as fat without demand for their use – so that JR’s diary doesn’t turn into diet advice and to allow comments on Paul Krugman – its nearly analagous to a depression with a severe lack of aggregate demand for the unused resource mass unemployment. It is not additional resource.)

            (Apologies JR for drifting so off topic).

          • lifelogic
            Posted June 3, 2012 at 7:05 am | Permalink

            I agree many are too fat and should eat less.

            Never the less, someone who wishes to maintain their existing weight will need to eat more if they do more exercise. They will also need to continue to eat more while they continue with the exercise to maintain weight.

        • Bazman
          Posted June 3, 2012 at 4:02 pm | Permalink

          Silly science lifelogic. Trying to prove that driving a car is better for the environment and uses less energy than a bike or walking. The dirt in cities proves this to be untrue. Mopeds must be the best way to travel if you believe this?
          The idea that weight which will of course effect rolling resistance does not effect the fuel consumption of a car laughable. Have you ever pushed a car for any distance on flat ground? It takes a fair bit of effort and modern cars with their increased weight and larger tyres make this hernia inducing. The fuel consumption of modern cars has been offset by the increased weight due to safety and other equipment. “It’s not to bad once you get going!” I’d like to see you push a car. I suspect you might need a burger afterwards.
          185 cm is 6.06948 ft by the way and BMI does not take into account muscle..

          • lifelogic
            Posted June 3, 2012 at 8:16 pm | Permalink

            @Bazman “Silly science lifelogic -Trying to prove that driving a car is better for the environment and uses less energy than a bike or walking”.

            Sorry but a “full car” just is more energy efficient, all things considered sun, to farm, to cow, to plate, to gut, to muscle – certainly better than walking. Bikes are closer than walking but cannot beat a full 7 seater efficient car certainly not for meat eaters.

            Just do the sums not to mention the costs and risks of all those hip and knee replacements and the shoes.

            Also you are, alas, 15+ more likely to be killed doing it, per mile.

          • Caterpillar
            Posted June 4, 2012 at 11:36 pm | Permalink

            I agree with Bazman’s approximate earlier numbers (35MJ per litre in gasoline assume ~40 miles per gallon => 1000kcal per mile used or wasted). But I agree with Lifelogic’s suggestion that full lifecycle driving is more efficient than walking. I also agree with Lifelogic that weight is not part of fluid drag, but I agree with Bazman and Uanime5 that weight matters due to rolling resistance and the scarcity of constant velocity driving (traffic controlled towns and heavy right foot).

            But overall I still disagree with lifelogic, the meta analyses of many pedometer studies of obese people (I won’t use BMI again Bazman, but I had earlier assumed that none of us were Dorian Yates) shows weight loss and not full compensation eating. Overall lifelogic’s argumentation seems OK, though full sums needed, but I think the starting premise is still wrong – that the system (the people) are efficient (using minimal resources) to begin with… they’re not.

            I suspect there might be the same suspicion in arguments about the morality of biofuels. If ‘we’ were on the efficient frontier then I would rather use land to feed people than make biofuels, but we are not on the efficient frontier; whether improving Brazilian beef producution per hectare productivity to grow more sugar cane (gm castor or whatever), or dumping the beef altogether there is more energy to be had.

            (Aside 1: Here lifelogic is such a supporter of constant speed and stiff wheels (s)he will soon be signing up for a non-stop HS2 from Brum to Euston.)
            (Aside 2:- personallyI like the multi-use oil industry, cars and beef.)

  4. lifelogic
    Posted June 1, 2012 at 12:37 pm | Permalink

    What a surprise manufacturing down, construction down, weak domestic demand.

    What else did Cameron Osborne expect with their anti business, anti growth, over regulate, lack of vision, labour back soon, tax borrow and pour down the drain policies?

    • Cliff. Wokingham
      Posted June 1, 2012 at 1:53 pm | Permalink

      Yes, all part of the plan!

      Make the country completely broke so that we’re forced to go to the EUSSR for a bail out, using our own money which we’ve already given them, in exchange for more power being sent to Brussels.

      This has already happened in the former countries of Italy, Greece and Eire, it will happen in Spain and Portugal and perhaps, France. Once this part of the plan has completed, we’ll be next and if we resist, our economy will be “accidently” talked down by the EUSSR and our own so called government until we have to comply….Resistance is futile. We will be part of the New Socialist United States of Europe because our political elite have already decided that is what they want.

      If any vote under the guise of democracy is afforded to us and we vote against it, we will have to vote again until we get it right.
      It is, in my opinion, sad that during such a time of celebration of our monarch and all things British, we have an infestation of anti British, anti Monarchy traitors ruling us.

      My advice: If you’re young enough, get out of the UK while you still can.

      • lifelogic
        Posted June 2, 2012 at 12:07 pm | Permalink

        Indeed the tax system in the UK says go. Unless you are a non dom with offshore income and a fondness for warm beer & bacon and eggs.

        • Bazman
          Posted June 2, 2012 at 2:49 pm | Permalink

          Simplistic nonsense again.

        • A Different Simon
          Posted June 2, 2012 at 7:21 pm | Permalink

          Lifelogic ,

          You are probably right but most of us don’t make anywhere near enough money for that to be the case .

          • lifelogic
            Posted June 3, 2012 at 9:01 am | Permalink

            I agree but lower taxes/NI, as in many places abroad, and the consequential better job availability and real incentives to work would help hugely.

    • Bazman
      Posted June 1, 2012 at 3:20 pm | Permalink

      Cutting back the economy has had no effect? What should the government invest in other than tax cuts to large companies sitting on billions and tax cuts for the rich to save in the bank. More silly mantras from you with little to substantiate them. Was the economic crisis caused by overspending of the state? The answer is no. Is cutting money to the state making the problem worse. The answer is yes. This fantasy you have of cutting all state spending would condemn millions to poverty and the welfare bill to go into the stratosphere. Which of course you would also cut. Then what? They would all find more useful work? Implausible.

      • lifelogic
        Posted June 2, 2012 at 4:28 pm | Permalink

        “Was the economic crisis caused by overspending of the state?” The answer is mainly yes.

        “They would all find more useful work? Implausible” not all would but many and the rest would cost less on the dole than being paid to inconveniencing the productive as many are now.

        • Bazman
          Posted June 3, 2012 at 9:55 am | Permalink

          Overspending of the state caused by the bailing out of the banks. The markets did not collapse because of government spending this is your false belief. Like many of your other beliefs you come to a conclusion and then try to build some ‘scientific’ basis to justify this. The free markets underpinned by the state despite religious belief that the markets are infallible and could not make mistakes as they would be self levelling. So much for that theory. The implications of no bail out would be to great and the banks in one form or another would have continued trading leaving the state to pick up the pieces as we are now doing. Debts to our children? Get real they will be looking for a job in twenty years time. How about the twenty somethings looking for a job now? Where is the free market supplying all these jobs? They could not supply enough jobs or houses in the good times. You will no doubt say to much regulation etc. I’ll refer you back to banking and their fantasy. A total lack of regulations and control will create unlimited jobs? Dream on.

          • lifelogic
            Posted June 3, 2012 at 8:40 pm | Permalink

            Could you, perhaps, confine yourself to commenting on what I actually write – rather than what you assume I might be saying.

            I do not have “a religious belief that the markets are infallible”. Indeed I make much of my money by spotting irrational (or fashionable) market reactions and betting against them. I do not have any religious beliefs at all I just stick to observing the real world.

            Some good, and efficient, regulation is clearly needed in many areas.

    • uanime5
      Posted June 1, 2012 at 9:33 pm | Permalink

      Don’t forget about high inflation which reduced wages and pensions in real terms.

      • lifelogic
        Posted June 2, 2012 at 12:08 pm | Permalink

        Not inflation linked state sector pensions!

  5. sjb
    Posted June 1, 2012 at 1:03 pm | Permalink

    I suspect HMG’s goal is to reduce the importation of high ticket cars such as BMWs and Mercedes.

  6. Electro-Kevin
    Posted June 1, 2012 at 1:28 pm | Permalink

    As well as the financial squeeze there is also a total lack of confidence about the future.

    I find it ironic that we respond to behavioural ‘nudges’ such as fuel duty and tobacco duty only to be punished with new taxes elsewhere.

    The latest and most cruel is that those of us who strive, sacrifice and aspire for our boys (and it will be mainly white boys) to do well at school have actually done the worst for them as they are likely to be discriminated against when it comes to university admissions.

    This is so disincentivising.

  7. Bob
    Posted June 1, 2012 at 1:53 pm | Permalink

    NASA scientists predict “with certainty” that the Milky Way is on a collision course with Andromeda.

    Can we now look forward to a collision tax.

    • lifelogic
      Posted June 2, 2012 at 12:13 pm | Permalink

      More likely a new vast government department. The “Department of Galaxy collision Avoidance”. It will clearly need to be at least ten times the size the climate change one and to pay even more to top staff.

  8. c777
    Posted June 1, 2012 at 2:10 pm | Permalink

    Example.
    DAX down nearly 4% today.
    Why.
    Simple the Chinese and other economies are not buying so many German cars etc.
    QED not importing so many raw materials either.
    An economic downward spiral has began.
    In a global world economy we all go down the pan together.
    1930’s here we go.
    Our manufacturing slide is merely an indication of orders drying up,like Germany’s.
    Once a big bank fails it’s over the domino’s topple.

  9. Sue
    Posted June 1, 2012 at 2:35 pm | Permalink

    We’re buying nothing new now. Cash converters and ebay are packed with second hand bargains. VAT is a rip off. I’m sick of being taxed twice. Once on wages and again everytime I want to spend what little I have left.

    As for starting another business here. Not in a million years!

  10. Alan Wheatley
    Posted June 1, 2012 at 2:40 pm | Permalink

    I have been speaking to a chap who runs a small engine reconditioning company that does work for me. He tells me the jobs are coming in faster than he can get them out the door, but in the current climate there is no incentive to invest in more equipment or staff for fear of what is round the corner.

    The consequence is to take longer. I am experiencing this in other small companies.

  11. sc1
    Posted June 1, 2012 at 2:51 pm | Permalink

    Cut taxes and cut government ;give the people back there money and the freedom to spend there hard earned money as and how they feel.Why do governments believe they are entitled to everyone’s money? when hardly any of them have worked in and run businesses.

  12. Normandee
    Posted June 1, 2012 at 3:06 pm | Permalink

    This government started at a low base having snatched a coalition from the jaws of victory, and has continued the downward slide, it’s too late now, the climb is too steep with their existing curriculum and the passengers in yellow. Call an election let’s get it over with, they know how to win but they won’t do it so why should they enjoy the next 2 years pretending they know what direction they are going in.

  13. Bazman
    Posted June 1, 2012 at 3:12 pm | Permalink

    More proof that Tory economic policies of cutting the economy are not working. This fantasy that infrastructure payments and over taxation is clearly not true where is the demand from all the rich with their tax cuts? Cutting the economy and threatening workers rights hardly makes anyone want to spend on manufactured products.

  14. JimF
    Posted June 1, 2012 at 4:03 pm | Permalink

    It is supply side measures which aren’t being taken and should be.
    -relax regulation on employment
    -decrease taxes (NI, business rates)
    -loosen planning control
    -break up the banks
    Without all of these we will continue to drift

    • lifelogic
      Posted June 2, 2012 at 12:16 pm | Permalink

      Indeed

  15. Mike Stallard
    Posted June 1, 2012 at 4:10 pm | Permalink

    Drift.

    OK if you are winning. But I can see some awful roar as if we are approaching the rapids…….

  16. stred
    Posted June 1, 2012 at 4:19 pm | Permalink

    Electric cars will no doubt be free of tax, so that we can drive ‘zero emission whilst driving’ (see the ads) and forget that emissions are the same whist charging. Or drive the latest big luxury hybrid with free access to central London and no taxes to pay- although they produce more CO2 than a smaller conventional car.

    • lifelogic
      Posted June 3, 2012 at 8:44 pm | Permalink

      Exactly – and the taxes on electric cars will start soon once people have them – you can be sure of that.

  17. oap
    Posted June 1, 2012 at 5:17 pm | Permalink

    Back in the 1960s and 1970s governments used to fiddle around with purchase tax on cars causing wide swings in demand. It did not do the industry any good at all. If they intend to do this again you can say goodbye to the revival of the UK motor industry.

    Add to that possibility the likelihood of a real slump in global demand for all manufactured goods (cf the early 1980s and the credit squeeze that prevailed then), then it really is time to batten down the hatches and to stock up on the baked beans.

    Why are they so clueless? If memory serves me correctly, about one quarter of UK manufacturing was wiped out in the early 1980s.

  18. Dan H.
    Posted June 1, 2012 at 5:40 pm | Permalink

    What is going on is this: the current Government are not completely in charge of the country; someone else is making our laws for us, namely the EU. This would be perfectly acceptable were it not for a few small, niggling details.

    Firstly, the previous government had an inexplicable habit of goldplating EU-imposed regulations, so that our version of them was more binding, more stringent, and made even less sense than the version our European competitors were running by.

    Secondly, whereas the likes of France and so on get by very happily by implementing EU directives then partially or completely ignoring them (and giving the outraged bleatings of the EU courts scant notice), we have a habit of obeying these ill-conceived laws to the very letter.

    Thirdly, the EU is corrupt to the core and is notably corrupt in its law-making processes, to the extent that very large businesses can readily manipulate law-makers into imposing regulations which hurt big business a little, yet impose near-insurmountable obstacles to new small businesses. This would not be so bad if big businesses were much good at expanding and employing people, but they aren’t.

    Recovery from recessions and growth in employment is mostly driven by new small businesses starting up and employing people from the ground up. By kowtowing to every single EU directive that comes down the line to us, we are setting up a poisonous environment for new small businesses (quite apart from the poisonous credit markets at present) which will delay our recovery from recession.

    So, about all we will be able to do at present is simply mark time here and wait. Neither Cameron nor Milliband are likely to give us a straight, binding IN/OUT referendum any time soon (this will likely be postponed until the EU is safely defunct), and without being able to simply walk away from most of the insanity (oh, and seal our borders against rampaging benefits migrants) and repeal most of the dafter laws, there is little we can do.

    So, pull up a chair, open a beer and relax to the operatic death of the very first empire which actually started out decadent.

  19. lojolondon
    Posted June 1, 2012 at 6:04 pm | Permalink

    Why not crank up some basic costs – how about increasing red tape, and increasing the cost of energy – oil, gas, electricity and fuel,wonder if that would that help at all?

    After all, if CO2 is killing the planet we won’t need industry, will we?

    • lifelogic
      Posted June 2, 2012 at 8:01 pm | Permalink

      I am sure Vince Cable would say “I have seen no evidence that higher energy costs, more red tape, high taxation and restrictive employment laws have any negative effects on private industry at all”.

      Nor I imagine would hitting them over the head with a cricket bat or a brick in his opinion.

  20. ian wragg
    Posted June 1, 2012 at 7:09 pm | Permalink

    Lets keep handing contracts and subsidies to foreign firms. When we are eventually bankrupt at least the toffs will tell us the air is clean although we will live in squalor.
    John, your party is a bunch of chancers and I’m glad my money now goes to UKIP.

  21. Brian Tomkinson
    Posted June 1, 2012 at 8:21 pm | Permalink

    This would be the same Treasury that thought of the pasty tax, the static caravan tax and limiting tax relief on charitable donations all put in this year’s budget and now dumped this week! What confidence can anyone have in this department of state either with its civil servants or its so-called political masters ( part-time in the case of Osborne, who is too busy thinking how he can succeed Cameron)? I am reminded again of the words of Ronald Reagan:
    “Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.”

    “Government always finds a need for whatever money it gets”
    We could add to the latter “.. and much more besides”.
    Spending other people’s money is like a drug to politicians and the present bunch in charge is no different to their predecessor junkies. Then, in their trance or on their spending high, they wonder why there is a decline in demand from the private sector much of whose money they have virtually confiscated. What hope have we with such people in charge of the economy?

  22. Vanessa
    Posted June 1, 2012 at 10:58 pm | Permalink

    As has been said here, why doesn’t the government (or what appears to be a government) CUT taxes. It has been grumbling about the fuel price but probably about 80% of the fuel price is TAX. Why is it not CUT? Britain cannot grow until this puppet govt. creates the environment for growth – it is not rocket science! Get out of the sinking EU, CUT taxes and STOP printing money, in fact put UP interest rates so we have money to spend.

  23. Gewyne
    Posted June 2, 2012 at 2:47 am | Permalink

    We were driving to work on Tuesday morning and went past a road that had hardly anything but Peugeot’s parked in it. We decided to do a french car count, so we added Citroen and Renault to a ‘look out list’. Around 40% of the cars we saw that morning were French.

    How about we let people start business with just a simple A4 sheet, names, address, business bank a/c details – sent and registered and let those business hire people via contracts and not have to worry about PaYE, NI etc until they get to a certain size (10 employees ?). Let the contracted employee take responsibility for sending a cheque for liability as a self employed person would. Would make life a lot easier for startups.

    • Bazman
      Posted June 2, 2012 at 1:13 pm | Permalink

      Still going to have to pay NMW and the person must be self employed not a scam to save the employer money and deprive the state of taxes. Why should someone working for a small employer have no rights? They are not going to be sharing in the profits.

      • A Different Simon
        Posted June 2, 2012 at 7:29 pm | Permalink

        Bazman ,

        My experience is that I shared more in the success of small companies than large ones .

        I got a payrise when they did well .

      • lifelogic
        Posted June 2, 2012 at 8:06 pm | Permalink

        “Why should someone working for a small employer have no rights? ”

        Well they won’t have any when it goes bust will they! Nor will they have a job.

        • Bazman
          Posted June 3, 2012 at 7:33 pm | Permalink

          Not my problem. I’ll just get another job. Ram it. You will just find someone else? That is exactly what you are going to do. Find another fool. Business cannot thrive in these conditions for anyone.

  24. James
    Posted June 2, 2012 at 4:33 am | Permalink

    They are already taxing new cars at a penal level. I bought a new Land Rover last year and was horrified to discover that the first year’s road tax was £870. That on top of 20% VAT plus any other hidden scams I was not aware of.

    Had I known about the road tax scam when ordering the vehicle I would not have bought it on principle and will not be buying another until these taxes are lowered. I renew my car regularly due to driving high mileages for work and will look for one from Europe or buy slightly used ones in future. The penal levels of tax in this country are suffocating any expansion and worse still the money is being used to pay public sector workers obscene salaries and squandered on so many other totally unnecessary luxuries for the public sector (new ipads for MP’s, subsidised booze in the HOC, drunken sailor spending by councils, the police etc) it sickens me to see the way our money is squandered.

  25. A.Sedgwick
    Posted June 2, 2012 at 6:34 am | Permalink

    Would anyone trust a surgeon who had no practical experience and had not learned from his seniors but just qualified from studying books, well folks that’s how we run UK plc with too many career politicians and academics.

    • lifelogic
      Posted June 2, 2012 at 12:21 pm | Permalink

      Not only that but with PPE at Oxford it seems they are not even reading the right books!

      • A Different Simon
        Posted June 2, 2012 at 7:32 pm | Permalink

        Nothing is going to change until people stop electing failed lawyers .

        The death penalty needs to be restored for treason .

        etc etc
        Everyone will feel a lot better .

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, and graduated from Magdalen College Oxford. He is a Distinguished fellow of All Souls, Oxford. A businessman by background, he has set up an investment management business, was both executive and non executive chairman of a quoted industrial PLC, and chaired a manufacturing company with factories in Birmingham, Chicago, India and China. He is the MP for Wokingham, first elected in 1987.

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