London — It is very easy at the present moment to paint a dismal picture of Great Britain. Record unemployment. Record crime. Record violence. Record pay increases -- yet with the worst-ever figures for productivity.
Yes, it's very easy. So let us instead try the dificult thing.
Inflation has just begun to recede. It should fall below 20 percent by the autumn. The London Business School expects it to continue falling, but more rapidly, in 1981 and before the end of 1982 to reced to 8 percent again.
Although there are so many unemployed -- and nobody would want to minimize the severity of their predicament -- there are still more than 20 million at work. And anxious to remain at work. It is this fact rather than any action the government might take which puts a strong safety net under the recession.
Meanwhile even the destructive tactics of the major trade unions in pressing repeatedly and successfully for more and more pay without regard for prices or productivity have their positive aspect.
And that is that whenever labor prices itself out of employment it prices technology in. To a very large extent British industry has been forced to modernize or go to the wall. Many firms have indeed "gone to the wall." The long-established manufacturing industries have been brought close to destruction. But quite as many other firms have been forced to make the most of technology just to stay in business. So that when the recession is over the industrial base of Britain will be quite different from the base we knew in the past. And it will be of much higher quality.
The labor movement feels seriously threatened by this. For there remains a strong, and quite natural, feeling that technology puts people out of work: that there is only so much work to be done and if machines do it people won't. An architect friend of mine visiting the Soviet Union saw bricks being carried to a site on a stretcher by four men. He remarked that in Britain one man would do it, using a wheelbarrow. "Oh," said a Soviet official, "not here. That would put three men out of work."
But of course if four men do the work that one can do, the average of standard of living must remain unnecessarily low.
Certainly up until this moment in more advanced societies the experience has been that in such circumstances three men are released for more productive work. Which means a boost to the average standard-of-living. Fifty years ago most women, for instance, were chained to the home and the kitchen sink. Now with vacuum cleaners, dishwashers, washing machines, and freezers they are freed to add enormously to the national income.
When a balance is restored to the British economy the wealth-potential of that economy will therefore have been very considerably increased, mainly as a result of union pressure for higher and higher money wages during the times of stagnant output. It is impossible to see today how the unemployed will be employed in the future. Very few people foresaw the car industry, the universal aircraft, television, freezers, winter holidays in the sun for millions, air-polluted back streets of the industrial midlands. Yet these job-creating developments arrived; as others will surface in the future.
By 1984 Britain could be in the vanguard of this new era of progress, supported for the first 20 years at least by the background wealth of the oil and gas from the North Sea.
Meanwhile it is more than likely that the message about government spending will at least have got across, not only to socialistic economists but also to the man-and-woman-in-the-street:
Free services, essential services, education, health and welfare, and government job-creation programs have to be paid for. If that weren't so, what country would choose to be poor? And they have to be paid for either out of taxes or out of borrowing or from the inflation of the currency, there being no other ways of doing it.
Therefore any and every country must as a first priority build up its commercial, tax-paying, collateral-providing industries and businesses. These come first. Government spending, since it derives from their success, comes second. And this is so, while a high standard of living is the aim, whether a country is capitalist, social democrat, socialist, or communist.
With this understanding, with a high-technology high-productivity base, with a strong balance-of-payments thanks to oil, with new jobs unexpectedly opening up, and with a natural end to the "more-pay regardless of value" syndrome, and with an end also to rapid inflation, the picture of the Britain of the future can look very much more rosy than it does today.