Britain's Economy Is 'Not Working.' Here Are 2 Key Reasons.

The two main sources for this piece seem to be interviews with Simon Thomas, the Chief Executive of a British semiconductor manufacturer (Paragraf) based in Cambridgeshire; and Raoul Ruparel, a director at Boston Consulting Group, which is based in Massachusetts.

The narrative is that there is a chronic lack of investment in the UK which is preventing promising companies from securing connections to the electrical grid, and that local planning bureaucracy is also inhibiting development. Public services, including transportation, are weak; there is a lack of affordable housing; and these problems are so bad that, following the passage of the CHIPS Act, Paragraf considered setting up in the US.

The article notes that Paragraf was spun out of the University of Cambridge six years ago, and established itself nearby. Cambridge is arguably the best university in Britain for science and technology, so perhaps if Paragraf had set up in the US, it might have chosen a location near a close equivalent, such as MIT or Harvard, both of which are coincidentally situated in Cambridge, Massachusetts — a town that was named in honour of the British university. The two Cambridges have similar populations and similar centuries-old associations with academia, but how do they compare on the criteria discussed in the article?

The average house price in the British Cambridge is currently about £500,000 ($635,000 at the exchage rate used in the article), and the average house price in the American Cambridge is currently in the region of $1,000,000 (£787,000). They are both unaffordable by normal standards, but the American Cambridge is the worst of the two at the moment (or best, if you like high property values).

As regards transportation, both the British and American Cambridge are known for their cycling culture. The British Cambridge has the largest guided busway in the world, which was opened in 2011. Public transport in the American Cambridge is part of one of the oldest mass transit systems in the US, which is run by the Massachusetts Bay Transportation Authority (MBTA). The MBTA has acquired a reputation for financial mismanagement, and the system it controls is amongst the most dangerous in America; in 2022 the Federal Transit Administration announced that it would be intervening at the authority and was 'extremely concerned with the ongoing safety issues' affecting the system [1].

What about connections to the electricity grid in the two locations? Curiously, much of the electrical infrastructure in both Britain and Cambridge in Massachusetts is owned by the same corporation: National Grid PLC. National Grid is a British company, but it happens to have a substantial American business [2], and it owns a lot of the electrical grid in Massachusetts and New York; it is likely that the entity responsible for large parts of Britain's electrical infrastructure also owns the electrical infrastructure that supplies the Boston office building where Raoul Ruparel's company is headquartered. The transatlantic involvement in electrical infrastructure runs both ways: a large part of the electrical grid of Northern England is owned by a subsidiary of Berkshire Hathaway [3].

The issues of planning bureaucracy discussed in the article are complicated, and properly comparing the American and British systems would be a difficult exercise, but from what I know of them they aren't dissimilar; the complaints about the systems are comparable. The article mentions recent measures by the British government to 'impede NIMBY-ism'; Nimbyism is originally an American term (the acronym can only be derived from American English; a 'back yard' in the US would typically be referred to as a 'back garden' in the UK), but it easily gained currency in Britain because the concept and many of the issues underlying it are familiar in both countries. It seems to me that in some respects this issue is a feature rather than a bug; the right of local people and organisations to some say over the fate of their immediate environment is part of the practice of democracy in both Britain and America, and it may be necessary to uphold the system of private property rights that businesses carrying out development themselves depend on.

[1] https://www.bostonglobe.com/2022/05/09/metro/extremely-conce...

[2] https://en.wikipedia.org/wiki/National_Grid_plc#United_State...

[3] https://en.wikipedia.org/wiki/Northern_Powergrid#Ownership_a...

Its not just electricity. Looking as an investor, I would not today choose the UK for starting a busines or buying real estate. The level of social unrest, street violence, infrastructure outages, and more are very off putting. It's a subjectively 'ugly' environment. There are far more attractive places to put one's time or money.