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I would have given this excellent, common-sense article by Warren Meyer a different headline. It’s called “Why Keynes Was Wrong,” but I think the real point, the interesting point, is the importance of economic policy being formed, or at least informed, by people who have actually had experience of running a business. I remember talking to Sir John Hoskyns, who headed the Prime Minister’s Policy Unit in Thatcher’s first term, about just this. “Something critical about the Thatcher revolution,” he said, was
the introduction into government, for the first time, of people who have an idea of what happens inside a business. Britain is, compared to the United States, extraordinary because there had been, until Thatcher, such a limited number of people with any exposure to the business world in government.
He himself had founded and run his own information technology company. Recalling the early battles in Thatcher’s cabinet over economic policy, Hoskyns–who was savagely dry on economic policy–complained that
none had business experience, and … some of them were very good, a few like Nigel Lawson, Nick Ridley–I knew Nigel better than I knew Nick, I didn’t know Nick well–but there were various people like that, who really understood the importance of the environment in which business functioned. What they didn’t have–and it isn’t necessarily all that important–they didn’t know what it was actually like, being in business, just how difficult it is, just how well things have to run, the methodology, the systems, the mindsets, the way people think, the way people communicate, the need to have groups who understand the big picture so they don’t have to end their sentences and they can cover the ground fast, and respond to threats quickly, all that. It’s all highly skilled, at its best, and very difficult, and very good people are needed to do it. I think politicians as a whole never quite grasped that. They would be shocked to think that anything was remotely difficult compared to what they were doing. And politics is in many ways, because of its unpredictability and its range, probably as impossible as anything.
As I was looking through my notes from our conversation to find that quote, I happened upon these remarks, which now look quite prescient:
I think that some of the economically literate politicians do have a reasonable understanding of the importance of this, some of them of course don’t–you do get a tendency to think, “Business is a sort of unskilled labor for people who aren’t as clever as I am, you know, I got a First in PPE and therefore I’m naturally going to be in the Cabinet, and I’m going to be running the world, even though I’ve never done anything.” I mean, David Cameron is a classic example of this. He may be–-far too early to form any views, good or bad about him, but, you know.
It’s not too early anymore, and I do think he put his finger exactly on what we’re seeing in Cameron: the mark of a man who’s never done anything. And needless to say, neither has Obama. Among other lessons to take away from this presidency is that yes, experience counts.