The United Kingdom is a nation with a split personality. We are a country profoundly divided, both economically and politically, into undeniable regional blocks. Last week's election brought this contrast into stark relief: almost the whole of England, save parts of the north-west and north-east, voted for free enterprise; while Wales, Scotland, Northern Ireland and parts of the north voted for big government. According to the Office for National Statistics, London and the south-east's gross value added is dramatically higher than in areas like Wales. And public spending as a share of gross domestic product in Wales, for example, is almost twice that of London, at roughly 70 per cent. Essentially, most of England is capitalist, while most of the regions are socialist.
Of course I exaggerate; many parts of London voted Labour, too. But unquestionably the wealth-generating parts of Britain are redistributing increasing amounts of tax to the regions – overall London and the south-east produce 43 per cent of total UK tax revenues. These transfers are unsustainable – they are a drag on the prosperity of the whole country, because the most productive elements are increasingly subsidising the less productive parts.
I see the same trends in statistics about start-ups and the locations of high-growth companies: the south-east of England hosts a massively disproportionate number of the entrepreneurial companies that are our future. How does society revive the spirit of enterprise and ambition in so many of the regions and stop the state crowding out the private sector?