Posts Tagged ‘financial crisis’

Bank bailout vs. science

July 6, 2012 1 comment

Another quasi-political post. Brian Cox, in an interview with the BBC, described the cost of the bank bailout in the UK as more than the entire since budget ‘since Jesus’.

You may have come across Brian Cox as a very telegenic presenter of science TV shows, and he’s also professor of particle physics at the University of Manchester (and one-time keyboard player in the band D:Ream in the 1980s). Given his scientific credentials I wondered how he’d come up with Jesus as a reference point.

But look, here are the (rather sketchy and broad brush) ‘facts’ of the case. In 2009 Reuters reported the UK Treasury had spent £850 billion on the bank bailout and this figure was also reported in The Independent newspaper. The Guardian news blog tried up update the figure and offered a range of calculations in September 2011. By then the £850 billion had risen to around £955 billion and fallen back to £512 billion, and by some estimates on the blog the total level of commitments to support had at one point gone some way over the £1 trillion mark. The range of figures varies because some of the headline costs were guarantees and indemnities that weren’t called on, interest on loans was being paid back to the government, some of the cost relates to the purchase of shares in banks whose value fluctuated, and so on.

However the total cost isn’t just the cost to the Treasury, because the crisis accounts for a loss of (probably) somewhere between 11 and 13% of GDP for an unquantified number of years.

But let’s take the headline figure of £850 billion for illustrative purposes. How does that compare to government spending on science?

First off, we have a bunch of definitional problems: does ‘science’ mean only ‘hard’ sciences like physics and chemistry or are social sciences included? Does it include money spent on developing research findings into usable applications and products? Which bits of government spending qualify as being part of an overall ‘science budget’? And so on.

However the headline figure, again, is around £4.6 billion annually in recent years. And obviously this has fluctuated over time, especially if you want to project figures back into history. The idea of ‘science’ as we know it, crucially, only began to exist in the late 1600s – a little over 300 years ago. Indeed ‘England’ as we now know it hasn’t been around all the back to Jesus, but only emerged after the time of Aethelstan in the 900s AD.

But consider the relationship between the two headine figures. The government has spent (or committed) enough money to address the banking crisis to fund around 185 years of scientific research at current expenditure levels. And it’s a reasonable assumption that in proportional terms the government wasn’t spending anything like that between, say, the late 1600s and the mid-1900s – a potted history of science funding in the UK is on Wikipedia.

And that makes it a reasonable point to make that more has been spent on the banking crisis that has been spent, in total, on science right to way back to, say, 1675 when the Royal Observatory was established in Greenwich, broadly speaking the first point at which the government of the day decided to fund ‘science’ in any form we’d recognise today.

And the same would hold true, obviously, of any date prior to that because the ‘science budget’ would have been effectively zero before then. So it might have been more accurate to use 1675 as the reference point. To say more has been spent on the crisis than the total spend on science ‘since the time of Jesus’ remains accurate and clearly makes a hard political point. To go further back and say ‘since the time Stonehenge was founded’ – well, that was between 3000 and 2000 BC,  it cost a huge amount of time and effort in terms of the population of that time, and it might be regarded as a scientific project of its time.

But the point is, by any standards the disparity in spending is huge. And the disparity between fiscal and scientific results on virtually any value-for-money terms, even allowing for the fact that science requires a manufacturing and industrial base and some kind of financial regime in order to progress, has to be even larger.

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