THE PUBLICATION of A-level results always causes me concern about the state of education. It is not the grade inflation that worries me. Just as monetary inflation does not mean that the real economy is shrinking, nor does grade inflation mean that educational standards are slipping. What worries me is the silliness of the great and good who take the opportunity to tell us “what this county needs” from its education system.

This year’s great and good complaint is that Britain is not producing enough science graduates. According to Sir Richard Sykes, the Rector of Imperial College: “If we produce a generation well versed in literature, history and politics but ignorant of the foundations of mathematics and science, our ability to compete internationally will certainly be compromised. In the global economy we will be fighting with one, if not both, hands tied behind our back.”

Sir Richard peddles the idea that international trade involves competition between nations. He is in good company. The Prime Minister often compares Britain’s economic performance with that of its “European competitors”. And politicians and commentators talk endlessly about the country’s international competitiveness.

Despite its popularity, the idea that countries compete in international trade is nonsense. It is companies that compete, not countries. The competition between Renault and Ford is not a competition between France and America. An American politician who thinks it is, and imposes import tariffs on Renaults, only injures his people. He forces them to pay more for cars and diverts American resources to the car industry when they could more productively be deployed elsewhere.

The free trade that allows competition between companies from different countries is a form of co-operation between the countries themselves. It allows them to deploy their resources more efficiently. All countries that participate in the global economy benefit from it, even if (indeed because) some of their companies do not. A “win-win” arrangement isn’t a competition.

The idea that trade involves competition between nations stems from the tenacity of an early socialist misconception. Many continue to think of a country as a single, very large, company. The expression “UK plc”, typically used by those who like to think of themselves as economically astute, perfectly encapsulates the error.

Once you think of a nation as a company, other mistakes follow quite naturally. You think of international trade as a competition. You think that we should aim to export more than we import, as if exports were the country’s revenues and imports its costs. And you make the biggest mistake of all. You try to plan the economy. You think that the Government, like managers of a company, should decide how to allocate the nation’s resources.

This misconception persists not only among academics, for most of whom socialism is second nature, but even on the political Right. In a leading article last week, The Daily Telegraph agreed with Sir Richard. After lamenting successive governments’ failure to produce more science graduates, it claimed that “with China and India now churning out science graduates on an industrial scale, such neglect is potentially disastrous”.

I wonder if the Telegraph also believes that the Government should direct more of the nation’s resources into underwear manufacturing. After all, China is churning out underwear on an industrial scale. If we are to compete with it and avert a national disaster the Government must surely see to it that Britain recovers its underwear competitiveness.

There is no more need to compete with China in the production of scientists than in the production of underwear or anything else. If China enjoys a comparative advantage in the production of scientists, then we should buy our scientists from China. And it can buy its PR consultants and video directors from us. In a global economy, the nationality of scientists matters less than ever.

If there were a shortage of British scientists, then their price — that is, their pay — would increase. Students who seek high incomes, of which there is never a shortage, would then be inclined to switch from literature to science. In a free labour market, where salaries vary with the supply of and demand for labour, skills shortages are soon eliminated. Sir Richard, the Telegraph and the Government can rest easy. Only when the planning urge overcomes our leaders do we risk persistent shortages or surpluses.

Alas, the urge does overcome them when it comes to skills. Science degrees, like all degrees, are already massively subsidised. Students pay well under half the cost of providing a science degree, even though they receive well over half its benefits. So there is almost certainly a surplus of British scientists. Which would explain why scientists earn relatively little — a fact that the science lobby always complains about, except when it is too busy bemoaning the shortage of scientists.

Those who lobby for state support — be they French farmers, US steel-makers or British scientists — claim to be the backbone of the nation, the foundation of the future or something similarly fabulous. But it is a perverse argument. If what you produce is so valuable, why can you not find willing buyers at the unsubsidised market price? Let us hope that educational standards soon rise to the level where the producers of such self-serving nonsense can find no one willing to buy it.

Jamie Whyte is the author of Bad Thoughts: A Guide to Clear Thinking

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