Management Today comments:
What is to be done? While Lenin asked that question in plotting capitalism's demise, we want it to prosper. But that requires a much stronger British industry.
Clearly, much of industry's post-war history has been a catalogue of disasters, of half-hearted management, an antiquated union structure, old education system and the corrosive "them and us syndrome". True, there have been some useful changes: union reforms and more professional managements. But the 1990s are going to require a lot more.
Despite the brilliance of the British military, our role in "Schwartzkreig" may lead to a rerun of 1945, when we sat back on our laurels and watched the world overtake us. Britain may have done reasonably well by past standards, but our competitors have outstripped us, as Simon Caulkin starkly reveals on pages 34-37 of this month's issue.
So what is to be done? First, manufacturing industry must be the absolute priority for every political party. It must be held in the highest esteem, not simply milked to pay for absurd promises made on the hustings.
Clearly no government can be trusted to run the economy without manipulating it for short-term electoral advantage. This inevitably leads to a stop-go economy, and is why the electoral cycle must be taken out of any prime ministerial hands.
Much better the American system of fixed term parliaments, perhaps with a change to a more equitable electoral system thrown in. Any temptation to massage the economy could be further eroded if we had an independent central bank, with the sole directive to maintain the integrity and value of the currency.
On the education and training front, apart from pumping in more resources, government and industry must ensure that both are effective and widespread. If firms refuse to pay for recognised training, relying on that old British custom of poaching, they should be subjected to a training levy. The haphazard state of management, scientific and industrial training also needs to be sorted out.
The public must also accept that nurturing industry is as vital to the national well-being as social services, as it underpins the whole welfare state. Here the media have a role. Too often in the 1980s the financier has been elevated while manufacturing has been derided as "boring".
In the long term, the stop-go cycle must be smoothed out. New ways of tackling wage inflation are needed. From 1979 to 1989 UK earnings grew three times faster than in Germany and twice as fast as in America. So much for mere market forces.
There may even be a case for some form of incomes policy - an informal code agreed by government, employers and unions, which allows a real expansion in national wealth. It would be vital to show the British workforce that such a policy does indeed have tangible results in terms of increased long-term investment.
What is not needed is an interventionist policy where governments try to pick winners, establish enterprise boards or actually run business. Politicians have made enough mess of the British economy without being let loose on business.