Being from North America, I am always impressed by the beauty of many of Europe’s old districts. None is as spectacular as Cambridge with the combination of its medieval architecture and parkland around Cambridge University. My visit this time was enhanced by record high temperatures and wall to wall sun. None of the cold, wet, dreary climate for which the UK is known.
In Cambridge - a beautiful historic location
Conversations in the hallways and in the streets during my first day of meetings in Cambridge were dominated by one topic, the rather poor showing of the England Football team in the World Cup and their loss to and elimination by Germany the day before. You could not turn on a radio or TV or pass someone in the street without hearing national disgust at the game and the terrible state of football in the UK now that it had been taken over by the financial interests of club football. Sounded like the comments in North America about the NFL, NBA and NHL. Welcome to the world of professional sport.
I was meeting my colleague Terry Mughan at Anglia Ruskin University to discuss an open innovation project that we were working on with other North European cities, but our conversation got slightly sidetracked. The new coalition government in the UK had come down with its emergency budget and one item involved the cutting or elimination of funds to the Regional Development Agencies (RDA’s). The cuts would be greatest in the regions of England doing well, London, the Southeast and East England, the location of Cambridge. The project that we were working together on was likely to be affected. Terry indicated that several other projects affecting initiatives to ensure Cambridge competitiveness would also be affected.
Entrance to Robinson Hall
What turned out to be cathartic for me was being in picturesque Cambridge on a sunny day and trying to right the wrongs of the world. Terry and I got into a discussion on globalization and how public policy was still trying to desperately catch up with our post financial crisis world or even the tech crash of earlier this decade. The UK was looking to take the standard path: the areas around London were doing well, areas like the midlands and the north were doing poorly, therefore send the money to the regions not doing as well and let the prosperous regions fend for themselves. Standard redistribution of wealth. Now we were talking about one of my favourite topics. The unfortunate necessity in wealth redistribution is that you have to have wealth to redistribute.
For at last 50 years, the driving force of the modern Canadian economy has been the Toronto-Montreal-Ottawa triangle. A fact of life in Canadian public policy has been to let Southern Ontario survive, it is doing well, and see how the government can help the rest of Canada’s economy catch up, often using the tax revenue from Ontario. Obviously, the UK has some of the same issues. Since both Terry and I are involved in knowledge-based industries and how they compete and survive (albeit coming at the question from different perspectives), we got into the discussion.
Both Ottawa and Cambridge are exporting regions, dominated by knowledge-based and highly innovative and entrepreneurial companies. Both regions are examples of the new economic reality: we compete globally and the vast majority of revenue is generated from exports. We have to be constantly adjusting to retain our competitive edge. We have as many or more alliances with like regions in other countries than with regions at home. The standard national policy response in crisis periods is to throw money at the regions in need and let the less affected regions fend on their own, as is being considered in the UK now. But the UK is also looking for an export led recovery, depending on regions like Cambridge.
And here we have the dilemma. You have the high performing regions battling it out in a global economy with an ever changing competitive environment. Yet, they are not to be supported. How does public policy establish the national framework that supports their Cambridges and Ottawas to achieve those export related goals at an international level and yet not have it appear at the national level that support is being given to the haves. As I talked to other companies throughout the week, this theme kept resurfacing. Strategies were being developed to solidify Cambridge’s global reputation, and yet these could be forgotten as the national government responded to regional disparity concerns. The investment needed to keep that export engine turning is often relatively small. There is not the big dollar, ribbon cutting opportunity of new factories or hundreds of jobs.
Every once in awhile, it is great to break out of the churn of daily business, and debate the larger challenges of our business. It is also great to hear that we were not the only region facing the challenge of responding to international competitiveness in the face of old public policy concepts. It will be interesting to see what country will understand this new dimension of national policy and respond.
