Fly me to the moon...
What connects cost-of-living and Nasa + sports books to read
Thanks for reading Off to Lunch. If this newsletter was shared with you please sign-up below to become a member. You will get Off to Lunch sent directly to your inbox, get full access to Friday’s newsletter and our Sunday press review, attend our events and contribute to the work of Off to Lunch
Rishi Sunak has warned in an interview with the Financial Times that it would be “complacent and irresponsible” for the next prime minister to ignore the risks of financial markets losing confidence in the UK as the government tries to help households and fight inflation. Meanwhile, Nasa is trying to get to the moon…
As the Conservative party and its members vote on their new leader and Sunak battles with rival Liz Truss, businesses across the UK are not just trying to control costs and survive but innovate and keep up with rivals. You cannot move forward while standing still. While you are stuck in limbo it is not just the immediate challenges that have to wait. Opportunities are lost that you never realised existed.
I am just back from a short trip to Manchester and the north-west of England (either side of a trip to Switzerland for a podcast interview). It was striking among the people I spoke to, many of whom were Conservative voters (probably half-and-half), how much the issue of unfairness came up. This is common during periods of high inflation and is politically toxic. When people think the system is not just unequal but unfair then governments and businesses face a backlash.
Interestingly, this sense of unfairness wasn’t just directed at mounting energy bills but other parts of the economy like the rail and water industries. The north-west train network is currently dealing with a dramatically reduced service by one provider, Avanti West Coast, and a swathe of short-notice cancellations by another, Transpennine Express. I lost count of the times over the weekend when I heard a station announcer say those dreaded words: “We regret to inform you….”
The frustration on water comes from people reading about droughts, hosepipe bans and sewage leaking into the sea but also companies using debt to pay dividends to shareholders. The Times reported on Monday that a YouGov poll had found that 47 per cent of Conservative votes favour returning energy companies to public ownership and just 28 per cent oppose a move. Just think about that for a moment. These are Conservative voters, supposedly fans of the free market. I sense polls for other industries would deliver similar results.
The new prime minister will have to address that sense of unfairness and tackle inflation, a challenge that often requires difficult medicine, as Off to Lunch has written before. But they will also have to address the long-term challenges facing Britain, such as boosting productivity and innovation.
This is why I thought the most important thing I have read in the last 24 hours was not Sunak’s interview in the FT but this piece by Lord Willetts on Conservative Home. Lord Willetts was minister for universities and science in David Cameron’s coalition government and is now president of the Resolution Foundation, the think tank, and chairman of the UK Space Agency. He also wrote the book The Pinch: How the baby boomers took their children’s future - and why they should give it back, a provocative analysis of intergenerational inequality in the UK which is worth your time.
Lord Willetts was writing from the Kennedy Space Centre in Florida, where Nasa is hoping to launch the Artemis I mission to the moon on Saturday after problems on Monday caused a delay. In the piece he wrote about Britain’s promising space industry, how Cornwall is playing a role in the mission, and that while this may seem a long way from the cost of living debate there is a connection because innovation is key to growing the economy. However, there is a problem. Lord Willetts adds:
We like to think of ourselves as good at science and research. We do indeed have a fantastic record of Nobel prize winners and research-intensive universities. But compared with most of our competitors there just isn’t the same focus or the same optimism about our ability to take R&D and use it to make life better and grow the economy. It is seen as esoteric not mainstream. It is not part of the fabric of our politics and our economy the way it is in America or Germany or Israel or Korea.
This has been caused by a series of factors including an education system that has left decision-makers short on science and technology knowledge but also a misplaced reluctance to pick winners because of the failures of industrial policy in the 1970s, according to Lord Willetts…
We think that our business leaders are somehow risk-averse when they aren’t worse than anywhere else. The problem is we expect them to bear more risk than in the US because there is a shortage of smart Government procurement and support for innovation. America helps its high-tech start-ups much further on the long journey to market than here. Elon Musk would not have got where he is without it.
This point neatly leads Lord Willetts on to how a new prime minister can boost innovation: by showing that the government will encourage businesses and look to use innovation as a solution for the challenges we face today:
The triumph of our vaccine effort was something good that came out of the tragedy of Covid. We should try to do the same with this energy crisis. Instead, the packages so far have not even promoted more home insulation, let alone boosting new energy sources. We should ensure we never again find ourselves trapped in old inefficient expensive wasteful use of energy. The package of help now also needs to point the way to a better future.
The piece is worth reading in full, as is the debate among readers below. They are here. Going to the moon is not something that should be on Britain’s agenda right now and critics say the Nasa mission is just a PR exercise. However, the launch is a clear reminder that while Britain waits for its new prime minister, the world is moving on….
Other stories that matter…
The Wall Street Journal sent a reporter to a Bongo’s Bingo night in Liverpool and the resulting piece is actually a fairly level-headed and enjoyable analysis of how an old format has been revitalised for a new generation. Headlined “England’s Wildest Event Is Bingo Night” it includes paragraphs like this: “A staple of nursing homes and fundraisers in the US, the numbers game has been on a journey since Jonny Lacey and his friend Joshua Burke turned it into Bongo’s Bingo—a no-holds-barred night out in Liverpool where Mr Lacey presides over a mashup of dance-offs, cheesy giveaways, ’90s nostalgia acts and, in between, a few rounds of bingo.” (WSJ)
Electric car owners in China are struggling to charge their vehicles because an extreme heatwave has led to charging points being shut by government restrictions (MIT Technology Review)
“Not very helpful.” That’s what the executive chairman of Britishvolt, Peter Rolton, has said about delays in getting a £100 million grant from the government for its gigafactory in Northumberland. The co-founder of Britishvolt said earlier this week that battery production may not begin at the Blyth factory until mid-2025 with construction of the factory hit by rising energy costs and interest rates (BusinessLive)
Surging inflation means it is going to cost people about £870 to complete the traditional sticker album for this year’s football World Cup in Qatar (Bloomberg)
Strong balance sheets and large profits for some of the world’s leading companies are helping to reduce the risk of a recession in the US because they are able to withstand the pressure of rising costs without putting up prices for customers (The Economist)
There is growing evidence that Covid-19 has left people susceptible to more health problems in the future according to this interesting piece (Financial Times)
And finally…
Thanks to everyone who got in touch about the mystery bird in last Monday’s edition. Most agreed it was a Cormorant. They are increasingly common in the UK around the coast, rivers, lakes and canals…
I am planning to start Off to Lunch’s new series on what business can learn from sport next week. For more information on that please see here.
Ahead of that I wanted to share some sports books with you that are a great read, worth your time and which I may refer to over the coming weeks because of what they say about innovation, leadership, strategy or another topic relevant to business. Here you go…
Provided you don’t kiss me: 20 years with Brian Clough by Duncan Hamilton
The cost of these dreams: Sports stories and other serious business by Wright Thompson
Barca: The rise and fall of the club that built modern football by Simon Kuper
Inverting the pyramid: The history of football tactics by Jonathan Wilson
What sport tells us about life by Ed Smith
Playing with fire by Nasser Hussain
Leading by Alex Ferguson with Michael Moritz
Range: Why generalists triumph in a specialised world by David Epstein
Moneyball: The art of winning an unfair game by Michael Lewis
Open: An Autobiography by Andre Agassi
Born to run: A hidden tribe, superathletes and the greatest race the world has never seen by Christopher McDougall
The inner game of tennis: The ultimate guide to the mental side of peak performance by Timothy Gallwey
These are available at all good bookshops or Amazon…
Thanks for reading. Off to Lunch will be back on Friday. If you enjoy Off to Lunch then please share it with others and spread the word. If this newsletter was shared with you then please sign-up below to become a member, get Off to Lunch sent directly to your inbox, attend our forthcoming events and contribute to the work of Off to Lunch
Best
Graham