From semiconductors to electric vehicles, governments are identifying the strategic industries of the future and intervening to support them – abandoning decades of neoliberal orthodoxy in the process. Are industrial policies the key to tackling twenty-first-century economic challenges or a recipe for market distortions and lower efficiency?
LONDON: Judged by its outcome, Britain’s general election lacked suspense and surprise. Throughout its four years in power, Tony Blair’s New Labour government enjoyed a large and steady lead in opinion polls. When Blair called for new elections, victory was taken for granted. Yet the election was revealing, not only of problems within British politics, but also of similar stresses in political systems across the West.
From the Labour Party’s point of view, this second election was a test of its credibility as a normal party of government. For nearly 80 years Labour was the main political alternative to the Conservative Party or Tories, and in several general elections it defeated them. Nevertheless, the Conservatives seemed the more normal party of government. Labour’s position as an outsider was underlined by the fact that it was never elected to two consecutive full terms of government.
Until now. Labour succeeded because Tony Blair jettisoned Labour’s entrenched left-wing dogmas. Traditional Socialist nostrums – nationalization, price controls, government direction – had failed in the past, could not be expected to work in the future, and thus held no credibility with voters. So Blair decided that New Labour would not just accept, but embrace the principle of market forces.
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