After the Second World War, an exhausted, impoverished and grieving Britain endured an extended period of austerity as the world about it formed and re-formed and nations everywhere shaped themselves to their new roles. What followed, after a while, was a prolonged period of breathless growth and modernity.
We seem to be at the stage of “it’s going to get worse before it gets a lot worse” in our current period of austerity and things will be grim for many, particularly when the economy looks strong enough to bear interest rates rising towards their long term norms. As happened before, many people will struggle to regain lost ground and recover what they had before the downturn, bitterly measuring every bit of what they have lost. As before recovery will be rationed across nations as competition for resources intensifies. As before we will learn, eventually, to make the best we can with what we have, and as before we will emerge stronger and better but different.
We do have some advantages this time over previous periods of downturn and austerity :-
1. This time the world’s biggest markets (China and India) are much less affected than western economies and following a different cycle. We don’t have to wait this time for the US to drag us all along in its wake.
2. We don’t need to compete for the resources needed to supply what China and India want from us. Primarily we are not selling manufactured goods but services, invisibles, and intellectual property.
3. With modern networks and the nature of services, we can move the work to the people, rather than having to move people to the work. Not all of it, but enough to mean that we don’t have to keep building in the densely populated prosperous areas and hollowing out others. This should spread the wealth around a bit as well, resurrecting dormitory towns in rural areas.
What we need to do is find new ways of organising ourselves into groups which can work together without gathering together, finding out what China and India want, and providing it without travelling or transporting anything.
So this time we need not wait for any new enabling technology, we need not wait for the world supply of raw materials to catch up with demand, we need nothing we haven’t already got to hand.
What we must do is abandon attempts to reclaim the past, and concentrate on grasping the future.