This time last financial crisis, the credit crunch, I was sitting in the decorous green room that is Home House near enough not to be able to pretend not to have overheard raised telephone voices. The call identified my fellow member as a business owner. I caught his eye and tried to lighten the mood. “Remember when it was easy?” The response, “Never was,” was fair. In the SME sector we prepare by reading the business pages but ours is a parallel reality. Things are never easy so we’re tolerably ready for the worst.
As you should probably do with most headlines (mine included) I would ignore this government’s pontifications on the state of the economy. Like they’ve got a clue. About anything. You’d be forgiven for a “banging on about this dreadful administration; here we go again” sigh but I think Prime Minister Cummings is smart. His head’s on his shoulders while others rolled …. well in other countries anyway. Perhaps Cummings’ cunning plan is weak government ensuring a light touch, leaving markets to regulate the economy.
Cummings has singularly failed to make Johnson look good (who could?), but the rabbit may still emerge from his mercury-polished top hat. I would reverse Brexit tomorrow but there are plenty in power in Europe that colluded with Cummings. In most crises the weak suffer the most and Germany will be left to deal with the Mediterranean countries and do what it can with France without us; leaving us adaptable, light on our feet. Continent isolated. Britain in Wonderland.
We all know that low tax is good for business, and while the borrowing to fund the health service and cash injections can’t be sustained forever, this is a fundamentally strong economy so when the health scare ends the books will balance sooner or later. Even if it doesn’t end, one new word “Zoom” emphasises human adaptability. My small firm’s big fear was that the communications infrastructure loosely known as the internet wouldn’t hold up. That it did is an amazing positive we’re taking for granted. If things do drag on, or we’re in for a series of pandemic tsunamis, whole sectors will embrace home working and we’re learning what that’ll do for the environment. Given our addiction to travel I’m sure we’ll innovate logistically and the restaurant sector is looking adaptable and resilient.
Many businesses have suffered dreadfully but is mindless optimism any more dangerous than the relentless erosion of confidence that appears to sell news? I swap stories with other chartered accountants acting for hundreds if not thousands of businesses particularly in London and hear many positive stories. I’d say our clients are trading more strongly now than they expected to be six months ago, reminding us that Darwin’s “survival of the fittest” wasn’t referring to physical prowess but to the adaptability of flora and fauna to change.
As Sir Jackie Stewart coached James May (on Top Gear) “It’s not how you go into the bend it’s how you come out.”
By Doug Shanks