Glasgow’s voyage from riches to ruin is a lesson for all
To find the world’s most extreme economies you generally have to travel far from the beaten track. There is one exception to this rule, a city closer to home that was described best by Sean Connery in The Bowler and the Bunnet, a 1967 documentary. In the opening scene the actor pulls up in his Aston Martin, hops onto a bus and turns to the camera, delivering a line that should be etched on the wall of every Whitehall department: “Glasgow: if you want extremes, this is your place.”
Glasgow is the Icarus city of the industrial era, a place that soared and then fell. Pick any arena — from science and engineering to literature and culture — and you will find something invented in Glasgow that has come to define the modern world.
The units we use to measure temperature and power — the kelvin and the watt — are Glaswegian, as is the television broadcast. The city’s underground system was the third in the world but the best designed (its trains were pulled by cables, so the subterranean air was clean). While many cities claimed to be the second city of empire, only Glasgow deserved the title.
https://www.thetimes.com/article/glasgows-voyage-from-riches-to-ruin-is-a-lesson-for-all-qh5gpvqbb
These successes rested on the city’s economy. Some of the world’s first steam ships were developed and launched on the Clyde, putting Glasgow decades ahead of other cities: when the Margery, a Clyde-built vessel, travelled to London in 1814, a “great commotion” was reported — no one on the Thames had seen a steamer. By the 1890s British yards produced 80% of ships launched globally, and the Clyde was the heart of this activity.
The city’s population boomed and unemployment was almost nil. Glasgow’s vessels underpinned the system of world trade, creating the interlinked world that we live in today.
Glasgow lost its shipbuilding and today is more notable for its shocking socioeconomic statistics than its role in global trade. Life expectancy is staggeringly low in parts of this city, particularly the East End.
In 2018 there were 394 drug-related deaths. The number is rising fast and as a share of the population is far higher than elsewhere in the UK. High suicide and murder rates have helped to give the city the dubious honour of a new label, the “Glasgow effect”, that sociologists use to describe the disturbing citywide tendency of dying young. Talking to locals, I found out how the economy became a matter of life and death in this great city. There are warnings and lessons for the rest of us.
Mighty industries can decline quickly. In 1947 British shipyards were still responsible for 57% of global shipbuilding. By 1962 the figure had fallen to 13%, with Japan’s yards becoming formidable competitors.
A plan hatched in London merged the Clyde’s historic yards in 1967, forming a conglomerate called Upper Clyde Shipbuilders, which was meant to benefit from economies of scale.
It was an attempt to mimic the larger Japanese yards and it backfired: by 1969 the group was on the edge of bankruptcy, surviving only with government handouts. Two centuries of world-beating shipbuilding had evaporated in two decades.
The loss of a single industry can be much worse than anyone imagines. A central idea in economics, set out by Alfred Marshall in 1890, explains why. For some firms, Marshall recognised, success came from being near a raw material or close to a river. But for others, doing well in a city or town was down to three benefits that came from huddling together with other companies.
When firms cluster like this, hiring is easier because locals pick up skills and the pool of labour deepens. The pace of innovation rises as technology spreads and amplifies. Supply chains become stronger, as proximity to other factories makes resources easier to obtain.
The stories I heard from Glaswegians who once worked in shipbuilding suggest that Marshall’s account is a perfect description of the hum of industry along the banks of the Clyde until the 1950s.
The lesson is that a single business matters: when a business sets up in a city, it creates unseen benefits for all others.
The problem is that this works both ways. As each shipyard closed on the Clyde, it left a shallower pool of labour and fewer innovators working on the latest technology. It also sent a shockwave down the supply chains — all this a drag on the companies that remained.
One local, Craigie, described the East End of the early 1970s as a bustling place: “You were busy, busy, busy — you were poor but you were working.” But with shipping gone, the Parkhead Forge and Dalmarnock Iron Works, factories that had employed tens of thousands, soon closed. By the 1980s unemployment in Glasgow had rocketed. Unable to find work, Craigie and many of his friends became addicted to heroin.
The rise and fall of Glasgow offers lessons that go far beyond Britain. By 2050 the United Nations expects 70% of people will live in urban areas. The economics of city life is set to come to the fore. Economic success and decline will be faster than expected and, through the subtle agglomeration forces that Marshall set out, will have ripple effects that, if misread by policy-makers, may be felt for a generation.
Investigating other economies across the world, I found the same was true: extreme times lay bare the truths that shape, underpin and protect our own more normal economies. Prudence means understanding life at the extremes. Glasgow offers us a warning.
Extreme Economies by Richard Davies is published by Bantam Press at £20