I was on BBC Radio Newcastle earlier this week, discussing Sir Alan Sugar's comment that we should all 'buy British' to help the economy.
Well, that's fine I said, so long as the British product is competitive on price and quality. If it is, then go for it. But we shouldn’t be paying a premium for something simply because it is British – especially not in a recession, when money is tight and we all need to make our budgets go as far as possible.
When people talk about 'buying British' they are mostly talking about food. Okay, maybe paying more for British food will keep a few farmers in business. But what about people who work in importing? And what about the people who work in all those other sectors of the economy where you couldn't spend your money, because you don't have any left? After all, an economic recovery is hardly going to be driven by agriculture.
Another issue that came up is whether we actually make anything in the UK any more anyway. The thing is, it all depends on what you mean by 'make'. If it's designed in the UK, is it British? Or what if the microchip or circuit board is British, but the rest of the product comes from elsewhere? Such national distinctions are increasingly irrelevant in a globalized economy.
And that, of course, is as it should be. To become wealthy, economies specialize. When they specialize, they become more productive – more output comes from the same inputs – and grow. That's how wealth is created. By contrast, assuming that a single national economy should do everything – usually the implicit assumption behind 'buy British' campaigns – is a recipe for stagnation and decline.