Your editorial (17 September) missed the point. London is not the victim of its own success but of its failure in its function as a capital. Surely the measure of its effectiveness is the performance of the national economy. The City, whose interests are the main focus of government economic policy, has negligible interest in investing in the countrys productive economy. If a factory is to be built that will actually make something and possibly sell some of its products abroad, its a pretty certain bet it will have to be financed by foreign capital. Yet there is a vast amount of money hoarded by British companies. Where are the tax incentives encouraging productive use of such resources and penalising its absence? It seems, for example, that there is no London interest in something as fundamental to the national interest as forming companies to build our own power stations.
It was once said Britain had lost an empire and not found a role. A role has been found: promoting London as a world financial capital. Since banking deregulation this priority has been given unlimited support by the political establishment. Yet the country cannot achieve solvency on the basis of this economic model. London cannot generate enough income for a country of 65 million. It is no wonder that patience is running short in the once great productive regions, now reduced to semi-mendicant status. Their zest for doing something about it is plain. But nothing will come of it without a transformation of the City. Simple devolution, necessary though it is, is not enough. The real issue facing the country is whether London can become a national capital as opposed to a city-state.
Dr John Blodwell
Newcastle upon Tyne