British State Subsidies: We are on a road with nowhere to go
State subsidies are like any vice: bad but very tempting, especially when everyone else has them.Britain, free of European rules, ignored its poor record On the road to state aid.
This is strange. Most of the generous donations from the UK have failed to support sustainable businesses.Automaker British Leyland goes bankrupt Fire of shame Although national blood transfusion 3.2 billion pounds, Or today’s 14 billion pounds. Other giants of British industrial strength, who were trained as national champions in the 1960s and 70s, were also thrown aside.Who today remember Marconi or International Computer Co., Ltd.?
There have also been more jingles recently. Guaranteed funds Metal tycoon Sanjeev Gupta (Sanjeev Gupta) to build a factory in Scotland seems to be a bad decision because he is under investigation by the British accounting regulator. It turns out that politicians don’t pick winners well.
Don’t expect this to stop them. Deglobalization destroys supply chains and encourages the creation of protectionist barriers in various ways, which means more subsidies rather than less. Take a semiconductor chip as an example. European countries have pledged to invest 145 billion euros in the design and production of local semiconductors. The United States plans to increase it by $37 billion.Japan has identified a chip manufacturer National project.
Other industries, especially the technology industry, also obtain national resources through government policies. Washington was annoyed by Beijing’s “Made in China 2025” blueprint-derided as the Chinese government’s attempt to “steal and subsidize and eventually enter the top of the global production value chain through competition.”It responded with a fairly Similar US version.
Under the mammoth Innovation and Competition Law, Washington has allocated about 120 billion U.S. dollars for areas supported by Beijing, including artificial intelligence and quantum computing.
British Secretary of Commerce Paul Sculley stated that the UK’s own customized subsidy system will be “simple, flexible, and based on common sense principles”. These words should cause the yellow flag.For a government that has been accused, agility and speed sound like inappropriate attributes Cronyism During the epidemic.Common sense principles and Delayed launch After six months of developing similar applications in other places using open source technology, the application was tracked and traced locally.
Before the pandemic, the world had spent hundreds of billions of dollars to support selected industries and companies. Subsidies, such as currency devaluation and tax breaks, will inevitably lead to competition at the bottom. The chase is ongoing.