The Wealth and Poverty of Nations: Why Some Are So Rich and Some So Poor (W W Norton & Company; 1998)

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LOSS OF LEADERSHIP^457

like people, as suffering from hardening of the arteries. This is pardy
because people create them, people who age. Succession of control is
a difficult and invidious process, pitting insiders against outsiders, some
insiders against others, blood against talent, blood against blood, tal­
ent against talent. At stake, decisions regarding choice of product and
methods of production. Here the British were late in exploiting newer
fields and ways, stressing instead learning by doing, in the shop and at
the bench. Such job apprenticeship has its virtues and successes, but
nothing is better calculated to preserve the old in aspic and miss the
possibilities of innovation.
Both historians and contemporaries have pinpointed such techno­
logical and scientific shortcomings as a major cause of British loss of
leadership. The "cliometric" optimists have retorted by defending
British performance in such older industries as cotton and steel—the
staples that had made Britain the workshop of the world. But what
about the new branches of manufacture, the industries of the second
industrial revolution? Back in 1965, a Cambridge economic historian
urged scholars to go beyond "pig iron and cotton stockings" and pay
more attention to soap, patent medicines, mass-produced foodstuffs,
and light engineering, "the production of vigorous and ingenious en­
trepreneurs as dynamic as any of their predecessors."^39
In vain; the defenders of British enterprise have done litde with these
success stories because they were in fact few and small. The second in­
dustrial revolution misfired. The most egregious failure was the abor­
tion of the protean industry of organic chemicals (dyestuffs, plastics,
pharmaceuticals). Here Britain was actually the pioneer and leader,
with strong advantage in the key raw material (coal tar) and in de­
mand (the textile industry), but lost out for want of knowledge, imag­
ination, and enterprise to Germany, Switzerland, even France.^40
Management made no commitment to systematic research. R. J.
Friswell, a working industrial chemist at the turn of the century, re­
gretted (1905) that the men in charge of the chemical industry
"looked upon all these [scientific] discoveries as isolated and not con­
nected in any way... that they were discovered by lucky flukes." Small
wonder that a key role was played by foreign immigrants—enterprise
moving to opportunity. Thus Ivan Levinstein, immigrant Jew and
hence outsider, deplored in 1886 the neglect of the newer, nonstaple
industries, the "insufficient appreciation of the importance of the
chemical industries... the absence of any intimate connection or in­
tercourse between our scientific men and our manufacturers."^41
Here one recognizes the extent of British abdication. In these new

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