The coronavirus has exposed the imbalances in modern Britain – The Guardian

The words are straining to come out. Boris Johnson hero worships Winston Churchill so it is obvious how the prime minister will pitch this weeks announcement of the plan to get Britain out of lockdown.

In late 1942, victory in the north African desert had suggested that the tide of the war might have turned but Churchill was cautious. Now this is not the end, he said in a speech at Londons Mansion House. It is not even the beginning of the end. But it is, perhaps, the end of the beginning.

Yet one reason it had taken Britain more than three years for this moment to arrive was that the country had been ill-prepared for war, something Churchill had complained about ceaselessly in speeches during the 1930s demanding rearmament against the fascist threat.

Johnson is unlikely to dwell on this chapter of Churchills career, but the fact remains that the country was ill-equipped to fight Covid-19 in February 2020, just as it was to fight Hitler in September 1939. Whats more, everything the government has done in the past two months makes that clear.

As in the 1930s, a decade of austerity, of penny-pinching and cheeseparing has taken its toll. Then it was a shortage of Hurricanes and Spitfires; this time it was a lack of trained nurses, intensive-care beds and ventilators.

One consolation for Neville Chamberlain when he eventually abandoned appeasement was that Britain still had formidable industrial capacity that could be converted to war production. The hollowing-out of manufacturing in successive waves over the past 40 years means that option no longer exists.

Britain still has world-class manufacturers but they operate in only a small number of sectors. The aversion to anything resembling an industrial strategy has left the country highly exposed to long supply chains. Most of these start in China, which as the NHS found when it took delivery of unusable ventilators cannot always be relied upon.

Nor has the UKs much-vaunted financial sector proved to be all that useful in a crisis. Despite government guarantees, the high street banks have been reluctant to lend, with the result that many businesses will not survive. Banks are quite prepared to provide mortgage loans where they can lend against an asset that on past form will appreciate over time: they are not really interested in lending to newly formed IT companies with bags of growth potential but which lack a financial track record. The decision by the chancellor, Rishi Sunak, to provide 100% loans for small businesses is proof that the system of providing business support is not fit for purpose.

The same applies to the welfare safety net. One of the lessons of the 1930s was that many of the men who were called up were in poor physical shape to fight as a result of disease, malnutrition and poor housing. Britain is a much richer and healthier country than it was 80 years ago, but poverty still kills. The Office for National Statistics data showing that the death rate in the most deprived parts of the Britain is double the rate in affluent areas tells its own story.

For the past decade, the governments narrative has been that the benefits system is too generous and that savings must be made. Yet within days of the lockdown being announced Sunak was increasing universal credit because the payments were not enough to live on. That remains the case.

The job of actually fighting the current war the poor bloody infantry in this instance has been groups whose role in keeping the economy going has long been overlooked: bus drivers, supermarket shelf-stackers, care home workers, nurses prominent among them. These are people who cant do their jobs from home, but who are putting themselves at risk after having just suffered a decade of public sector pay freezes and stagnant living standards. They are unlikely to react well to any attempt by the government to reimpose austerity once the economy is out of quarantine. The lesson of Labours landslide election victory in 1945 is that voters will look back at the pre-crisis world and come to a simple conclusion: never again.

Johnson knows this, which is why he is saying that this time the government will look after the people who suffer and not just the banks. Making good on this pledge will take some doing, and means learning some lessons.

The first is that getting the right big picture, macro-economic structure, right is crucial. It is not, though, just a question of repudiating austerity and gunning for as much activity as possible: growing the economy has to be consistent with greening the economy.

The second lesson is a bigger state has to be a smarter state, and that requires ceding more power to a local level. Britains heavily centralised approach to Covid-19 testing has compared badly to Germanys devolved model, for example.

A switched-on state would demand a price for the unprecedented amount of support it is providing. That might mean taking a stake in mid-sized manufacturing businesses, as the employers group Make UK has suggested. It would also mean bigger companies agreeing to put workers on boards, signing up to carbon-reduction targets or domiciling themselves in the UK for tax purposes. There should be no free lunches.

The Covid-19 pandemic has exposed the imbalances in modern Britain. It has highlighted the need for more community-based banks, for more investment in vocational education, for an industrial strategy that encompasses the everyday economy as well as trendy hi-tech sectors, and for a stronger social safety net. Above all, it has made the case for greater national self-sufficiency so that we will be more resilient next time.

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The coronavirus has exposed the imbalances in modern Britain - The Guardian