Guns, Butter or the NHS?

I started my study of economics at university.  ‘Guns or Butter’ were almost the first words I heard in my first Macroeconomics lecture. It was used to represent the production possibility frontier and I couldn’t understand the fuss. An economy could make nothing but guns, nothing but butter or a combination of the two. All those combinations were the limit of the country’s productive capability and that was productive frontier.

I understood the principles and had thousands of unvoiced questions.  This was nothing like the real world, but they were the professors and I was on my first day. Never mind. I listened, learnt some simple formula (after all I was doing mathematical economics and never had to write an essay) and picked up 15 marks in the exams. That was my purpose of sitting there. Do enough to get a good degree, play rugby, date, and not rock the boat.

Now here I am replaying the questions dismissed forty years ago, but now it’s a choice between a whole host of things and the NHS.

For my non-UK readers, the National Health Service or NHS celebrates its 70th birthday on the 5th July this year. The NHS was born out of the idea that good healthcare should be available to all, regardless of wealth. At its launch by Bevan at its heart it had three principles, that are it:

  • meets the needs of everyone
  • is free at the point of delivery, and
  • is based on clinical need, not ability to pay.

It is a British institution and while many Governments have tried to tinker with it, at its core it is untouchable, and rightly so.

I have written often about the NHS. I think it is wonderful and I love it.

I have experienced the alternative. I was in Dubai for nearly 5 years, where there is no health care, when I became ill. I couldn’t afford to do anything about it. It led to a hurried and permanent return to the UK to get treatment. In Dubai, before you can see a doctor you have to give a credit card number and there is a preauthorisation. That is not unique to Dubai. It is the norm throughout the world.

Since I returned, the NHS has taken me into their bosom and looked after me wonderfully. Whatever anyone else may say doctors, nurses and all the ancillary services are still caring and committed to care. I have met wonderful people. Ann, an international triathlete in the CT unit, Paula a diabetic nurse, Nikki my dietician, are among the many I now greet and meet almost as friends when I walk around the hospital.

(On another day I may look at the possible impact of Brexit on the NHS. There are so many Europeans supporting it I am unsure how long it would last if they all went home.)

The National Health Service is free at the point of service and is funded totally through taxation and does not discriminate against anyone, but it is under tremendous pressure. It needs more funding.

But let’s be honest it is not the NHS that is at fault it is our expectations. It is not because the NHS is wasteful, but medicine is becoming increasingly expensive, medicine is getting better at keeping us all alive and well. The demand is increasing and the cost of delivering treatment more expensive.

If we want the three principles fully implemented, with no rationing, no waiting lists, all the drugs possible then we have a problem. To meet fully all our varying needs the NHS could absorb all our GDP and for the first time the question of Guns or Butter has a reality. It could be one or the other.

Let’s get some data as I always like numbers but with recent NHS spending increases, up to date data is hard to find. But is we go back a couple of years the UK spends under 10% of GDP on health care while Switzerland, France, Germany, Sweden, among many others spend much more (up to 11.5%). The message is clear. We have prioritised health lower on our priorities than most of Europe.

Boris Johnson, our eccentric Foreign Secretary recently suggested that we add a further £5 billion to the NHS budget. As GDP isn’t growing something must give way if we want to fund health provision.

For reasons I don’t want to go into now, when I left Dubai, my life was in two suitcases. That was it. Two suitcases. The rest I gave away or sold for next to nothing. I know personally about budgeting and cutting the cloth appropriately. At first it was heart breaking. It was an insult to my ego but after a time it became liberating. To have nothing, to own nothing (other than my computer and 18-year-old SLK) releases a lot of angst.

If you have to cut close to the bone what goes are all the vanity spends that we keep, sustaining our image. The real essentials are a few photographs and memories.

I am not suggesting that the UK needs to cut so far back but with GDP capped and growing between 1.5% and 2.5% we need to make some decisions around our national ego, what we support and what we finance.

Let me start the discussion and ask this question. Do we still need to spend so much on defence?

The other major responsibility after health is defence. The UK spends approximately 7% of GDP on defence, or approximately 70% of what we spend on health.

The relatively high share of GDP on defence reflects the UK’s world military role. We have been in Iraq and Afghanistan in numbers far greater than almost anyone else than the USA. It is that ‘world military role’ that I want to consider.

The UK has a nuclear deterrent, the Trident programme and I will say from the start that I have been in favour of the programme since its inception. I have wanted each parliament to vote for it, as they have done.

The world military role ‘led to the acquisition of a nuclear deterrent (Trident), nuclear-powered submarines, Type 45 destroyer warships, aircraft carriers, F-35 carrier-based aircraft together with strategic air tankers, Typhoon jets, heavy lift and attack helicopters and an army with an expeditionary role (

Trident represents, at its most expensive, the British role in trying to keep the world safe. It is a deterrent that with the USA will stop the nuclear war against the Russians or North Korea. That is the dialogue, but is it still true?

There must be some truth in in deterrence. If I have a visible burglar alarm the probability is that it is the unalarmed house next door that gets burgled. If I carry a big gun, then no one messes with me.

We assume that we will not launch a first strike and so we are saying that we will only retaliate. The trade-off is Moscow for London or St Petersburg for Leeds. I know that I would rather be at the centre of the attack than inflict the same on another 10 million people and who would want to survive a world covered in clouds of atomic dust.

Honestly, I don’t care about an argument on deterrence. We can’t change the policies of America or Russia so let them have their stand off but do the British need to maintain a world role?

We are where we are because of our history. We conquered and ruled the world through military prowess. We stood alone and proud against the Nazi push across Europe and whether through guilt at our history or pride at WW2 we feel a responsibility to have a global role. Trident is symbolic and keeps the Great in Great Britain.

But there is a cost.

The nuclear deterrent system is composed of three parts: nuclear warheads which are mounted on Trident II D5 ballistic missiles which are launched from Vanguard-class nuclear powered submarines. Trident will cost around £100 billion, at 2012 prices, over the next 35 years.

Once I owned a very large house, two cars, land, a comfortable and privileged life style, and now, I have none of those. They may all have gone but I hope I am no less respected. I am not judged by those I respect on my possessions but my thoughts, words, and actions.

The UK could do the same. We don’t gain our global respect because there are four submarines cruising deep under the oceans with nuclear missiles always ready and pointing at Moscow. We gain respect because we have a compassionate and caring society that looks after its sick and unwell.

I don’t know. I am only asking the question. What is it? Guns or the NHS?

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Many thanks