ECONOMICS

Is Britain now a Failing State?

Every dog has its day. How about a lion rampant and a unicorn?

Is Britain now failing and failing faster?

There has been a lot of talk on this subject so I looked for evidence. This is what I found in the Fragile States Index (“FSI”).

The higher FSI number the more fragile you are. The lower the number the stronger you are. In 2006, Norway was top (with the lowest FSI number) and by 2020 Norway was in second place having improved its number from 16.8 down to 16.2.

Germany, after practising penalties, had the biggest improvement climbing 10 places to 13th spot.

In 2006 “Great” Britain was 17th and above France, Germany and the USA. The results of Cool Britannia?

By 2020, the UK had suffered a big fall to 30th place making the UK one of the fastest fallers in the top 30.

Look at the bad company the UK is now keeping.

Britain is falling around as fast as the USA, Argentina, Italy, Japan and Spain. The UK is now ranking below the USA and states like Uruguay and Mauritius; well out of the top league.

So, how did this happen? Can it be turned around? Do people realise the seriousness of the situation? Who will lead the UK out of this mess?

By now you will also be thinking what is the organisation (see here for the methodology), who produced it. Are they worthy of attention? Are there other data sources which confirm these findings?

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The Fragile States Index, Washington DC

The Fund for Peace is a non-profit based in Washington funded by a long list of donors which includes NATO, the UN and US Government agencies. Their indicators cover a range of factors.

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Which of these factors have driven the big fall in the UK rankings? I took a look at the data and its Economic Decline, the increase in Factionalised Elites and the social fracture causing Group Grievances with Brexit as a prime example.

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Analysis by the author from FSI Data

Here are the Trustees. No obvious reason to doubt their data but do comment if I have missed something.

So if you think the data are worthy of your attention read on. If you find corroborating or contrary data please share it.

There are no doubt many reasons for Britain’s fall in standing and its economic decline.

Here are two to add to the list.

INDIVIDUAL MEMBERS OF THE BRITISH ELITE DON’T THINK ITS THEIR JOB TO FIX THE ECONOMIC DECLINE OF THE UK

I can contribute my own personal if anecdotal data now. As a member of the UK elite, I can state that not a single former class mate of mine sees it as their duty to lead the UK out of economic decline. They work towards positions of influence, wealth and power but for themselves. They assume someone else will take care of the commonweal. More and more want to invest. But not lead.

The issue is plain in the tech industry. Tech is a large part of the US stock market now and is only set to grow.

The UK is barely in tech at scale despite a great start in AI in London,

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2018 report by the author for the Greater London Authority

Think of that. the UK is barely a player in the economy of today and the future. And I say that having spent my entire career in tech having first worked on an IBM 370 mainframe in 1976.

But if the elite don’t lead, who will? Not the UK state.

THE UK STATE DOESN’T REALLY THINK IT’S THE JOB OF THE STATE TO CREATE A UK TECH INDUSTRY

Having been in the room on many occasions, I can reveal there is, in effect, no plan. As a London VC specialising in AI, if there was a UK plan I would expect to know or been briefed on the plan.

In the AI field, “sector deals” were the plan. Here is the result one year on . The metric should be UK AI companies in the global 100 AI companies and AI vendor count.

Instead we have a brochure.

It’s more than a “will” problem. The UK state lacks the “skill” to lead the creation of a UK tech industry. The state thinks it’s about tax policy, inward investment and commercialisation of academic research.

Wrong. Each of these is the product of their respective producer lobby.

The big levers are:

  1. Leaders who want to create global businesses
  2. Human capital choosing to live in the UK
  3. Customer demand that is leading edge and local.

There is plenty of capital looking to invest in global businesses based in London. Capital is not the problem.

A recent lunch in Cannes with the French CEO of a French tech start up was revealing. The French state takes an active interest in their growth and independence. My French guest was incredulous that the UK has no plan.

During my 44 year career in tech and building UK tech, I have looked for someone to whom to report my progress. When I arrived back at Heathrow, brimming with pride on 14 February 1998 on British Airways the day after my NASDAQ IPO of my UK tech company, there was no one to report in to despite being ready to do business.

So, how did this happen?

Can it be turned around?

Do people realise the seriousness of the situation?

Who will lead the UK out of this mess?

Will you?

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Image open source — unicorn and lion rampant

Written by

Tech vendor scale upper. Decide market strategy. Plan the numbers. Hire the people. Hit the numbers. Solve the problems. McKinsey, MUSE, SUNW, XROX,

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