The official site of the Prime Minister’s Office

19 May 2008

Gordon Brown has hailed the internet industry as a model for the global economy in a speech at the Google Zeitgeist Conference.

Read the speech transcript:

Can I welcome you all, distinguished business leaders from all over Europe, to this great conference today. And can I begin by congratulating Google, ten years ago a research organisation, now a $180 billion company, an expert in social innovation - Google Labs, Google Maps, Google Earth, Google Tutors - making great strides in putting services to the people of this country and many other countries.

And I want to congratulate Google particularly today on the launch of a project with us, the UK Government, a new map of the world, an interactive map of the world, whereby with the Meteorological Office and with the British Antarctic Survey we will chart with Google, Google Earth, the changes that are taking place in our climate both now and prospectively, and I think this will be a huge tool for making people aware of all the great climate changes of our time.

I think everybody recognises we are in the biggest economic and social change since the industrial revolution. I think behind the credit crunch and what is happening to oil and food prices round the world, people sense we are in the biggest restructuring of the global economy we have seen in our history. I think people also sense that there is a shift of power taking place, from west to east, as Asia is in the ascendant, rising as an economy, and I think as we have just heard, people also accept we are seeing a shift of power from state to people that is propelled by the new technology that Google and so many of you are making available to people.

And I think people may sense that we are in the throes also of creating the first truly global society, people able to communicate with each other, organise with each other, and at the same time find that they have common cause with each other.

Churchill once said that those who try to build the present in the image of the past will miss out entirely on the future. And he also warned about people who were facing change, resolved to be irresolute, he said, adamant for drift, solid for fluidity, and all powerful for impotence - and that is a warning to all of us.

So this is I think not the time for standard political speeches, not the time for the sort of speeches that politicians make going round the country where they go to each different town and give exactly the same speech, and usually are bored giving that speech themselves. This is the time for doing something different.

There is a story told about Einstein, the great physicist, who ventured into the realm of politics as you know at certain points in his life, and he published a book about his thoughts and went round all the different towns of Britain giving a speech, and he gave exactly the same speech to an audience that was in the different towns and cities of the country. And he got so bored with doing it that one night his chauffeur who had been driving him around, who had listened to all the speeches during the time he had been travelling the country, his chauffeur offered, having remembered everything that he had said, to give the standard speech instead.

So Einstein sat in the audience and the chauffeur went up and gave the speech, and it went very well because he remembered every word of it, until something went wrong. The chairman for the night decided to invite questions from the audience and the first question was, how do you relate your theory of relativity to the intricacies of quantum mechanics? And the chauffeur was stumped, didn’t know what to do, and he said: “Look friends, this question is so easy that I am going to ask my chauffeur to come up from the audience to answer it.”

Now I want to say today that your industry is driving the next stage of globalisation, that the lessons we learned from the success of this industry are the lessons we have all to learn if we are going to make globalisation work for the future, and that we can also learn lessons about how we build not simply a successful global economy but a global society.

Now what do I mean by that? I mean first of all that you stand for an open and non-protectionist economy. The only way the internet and the new technology can work is if there is openness and if we are not protectionist. And I like to think that in Britain we have created the opportunities for the mobile phone market to develop, for the broadband market to develop, that we have pioneered the release of audio visual spectrum, we are moving in on the broadband and trying to make it more available to people, and we have got a light touch regulatory system - and we can talk about that in the questions - that benefits an industry where we are seeing the convergence of the telephone, the television and the computer.

So you stand for an open, non-protectionist economy. You also stand for a flexible economy that is capable of responding with light touch regulation, not heavy touch regulation, to the challenges of the time. You stand for innovation and therefore the flexibility that we need to support innovation and I like to think that we are making it possible for people not only to use new technology but to develop new technology in our country with the support we are giving for science.

And you stand for inclusion, and of course there are only 5% of people in Africa who can access the internet, but the demand is growing and your ability to provide that in all the different continents of the world is something that makes me confident about the future. And you stand for a technology that empowers. So it is people that are empowered by everything that is happening.

And these are exactly the lessons that we have got to learn if we are going to have a successful global economy. We will not have a global economy that works for the people of this world unless it is open, it is flexible, it is about free trade, it is non-protectionist, it is inclusive, it is empowering and it is about building a society.

The problem we have got at the moment is that protectionist sentiment is growing in almost every part of the world. If you go to America today the debate is about how they can restrict imports from China and other countries; if you go to parts of Europe today the debate is about heavy-handed regulation of hedge funds, or of sovereign wealth funds, or of other instruments of finance in the economy; if you look round the world at the moment you have got a fearful population, partly because of the credit crunch, partly because of the rising food prices, partly because of the rising oil prices, and there is absolutely no doubt that protectionist sentiment is growing, particularly in America and Europe.

So what you stand for: an open, flexible, and what I stand for, an open, flexible free trade economy, is under threat from public sentiment. And why is that the case? It is because of course a million manufacturing jobs are being lost every year from America, Europe and Japan, to Asia; a quarter of a million service jobs are moving to India and to other countries as call centres and others are developed there; 60% of our computers and 50% of our textiles are produced in China; Asia is now out-producing Europe. And you can see the public reaction in the States and in Europe as people become more fearful about their jobs.

And ironically all the great successes of globalisation, which is to cut the price of consumer goods, which is also in addition to that, to keep interest rates low, because inflation is low as a result of the counter-inflationary factor of Asian prices, are forgotten by people as they worry about their jobs, they are insecure and want to see politicians intervene to protect, to shelter, to stop the clock, to freeze frame, and that is the debate that we are seeing in many parts of Europe and America at the moment.

When I was at the International Monetary Fund meetings some months ago there were demonstrators outside, and one of them had a placard saying ‘Worldwide Campaign Against Globalisation’. And that is the irony, that all the beneficiaries of globalisation, particularly in Europe and America, see globalisation as a threat, they feel themselves victims and not beneficiaries, and at the same time they feel themselves losers and not winners.

So here we have this contradiction. We know that the only way we can have a successful globalisation is following the principles of your industry - open, flexible, inclusive, empowering. We know also that public sentiment, just as at other times of rapid change, is moving to be protectionist.

So what do we do about it? It seems to me pretty obvious, that we have now got to put the case for globalisation. First of all we have got to show people that the growth in the world economy as Chinese and Indian people become consumers is going to be very substantial in the years to come. I expect the world economy to double in size in the next 20 or 25 years, and even although we are going through the credit crunch and growth is faltering in America and Europe at the moment, we must not lose sight of the basic optimism of a world where producers become consumers in Asia and the world economy is going to grow at a very rapid rate.

The second thing that I think we can tell people that is about an optimistic view of the future is of course this - that there are huge opportunities for people in every continent of the world. It is estimated that there will be a billion more people in skilled or professional jobs within the next 20 years. So the opportunity for social mobility, not just in China or India, but the opportunities for people to make the best of their talents in countries like ours and in America and across the whole of Europe are enormous indeed.

The third thing of course is that technology will empower even more. And just as I look at what we can do in the public sector in Britain to empower people in healthcare with greater access to information for self-medication and everything else, in education greater access to information for people to study at home and to draw on the lectures and the lessons that come through the internet from schools, and colleges, and universities; in crime, for people to map the areas where crime is happening and to be far more aware on a day to day, sometimes hour to hour basis of what is happening in their neighbourhoods. All these great advances that are possible will empower people with new opportunities for the future.

And I think it is also true, something else that we should say to people, we can in the next 20 years create a truly global society. Think of the monks in Burma. 20 years ago, 10 years ago, even 5 years ago they would have had sentries standing over fax machines to stop information getting into a country and now, even with a repressive regime like Burma, information cannot be repressed forever, information cannot be suppressed and it comes out of a country.

Think of the Philippines where President Estrada was brought down by what people called, after a million people texted to come together in a demonstration, the first ‘coup de text’ in history. And think of Make Poverty History, millions of people round the world, linked by the internet, galvanising their efforts together to bring about substantial social change.

So what are the policy changes that I would propose we consider? First of all we have got to stand for free trade. We cannot allow protectionism to become the dominant mood because that will affect not just your industry but every industry and it will hold back the development of the world.

Secondly, we must stand for greater flexibility in markets. The two great protected industries of the moment are the two industries that are causing us the greatest problems today: the oil industry, with a cartel run by Opec; the food industry with high levels of subsidy that are preventing prices for people that at are at a realistic level, and preventing people from producing in countries and continents like Africa at a level that they should. And we need to have flexible markets there.

Thirdly, we have got to be more inclusive. The issue is not between change and no change, the issue is helping people cope with change. And that is why in every one of the industrialised countries the opportunities of education to get new skills as unskilled work becomes less relevant for people must be there and must be made available. So we will have to invest heavily in education as well as in innovation and research.

Fourthly, we will need global institutions that meet the challenges of global times, and we need an IMF where there is an early warning system for the world economy, a World Bank for the environment and not just development, a United Nations that can deal with the stabilisation that is necessary in countries that need to be reconstructed. And we will need of course to encourage the development of a global society in our times.

I believe that the challenges ahead for this world make us all optimistic rather than pessimistic. I believe that an industry like this can fight the protectionist sentiment that undoubtedly exists when people are fearful for change, but I believe that we must become proselytisers of a message, that instead of a worldwide campaign against globalisation being the common mood of the times, that we fight a worldwide campaign for globalisation.

It was said in ancient Rome that when Cicero spoke people said, from the eloquence of his remarks, “great speech”. But it was said in ancient Greece that when Demosthenes spoke, and he too was eloquent about what should be done, the public then said “let’s march”.

And I believe that we should all be marching as one for a vision of globalisation, absolutely central to the industry that you represent - open, flexible, inclusive, empowering and building a global society in our times. That is a challenge that I believe we can all meet together.

Thank you.

Read the Q&A transcript:

Chairman: Great.  So what can people in this room look forward to in the coming years in terms of making sure that the UK continues to be a positive environment for us to operate as an industry, for us to operate as businesses? Because as we discussed there is an opportunity for the UK to become sort of the best place for us to operate as an industry and I would love to hear your thoughts on how we could make that happen.

Prime Minister: I believe we have the most open economy in the world, so we have been the pioneers of free trade historically, we still are, and we will always fight protectionist sentiment.  I also believe that because of the advantages we have - economic stability, a commercial law system that is good, the financial services system based in London, the home of a large number of the creative industries - that we offer good opportunities for people.

The job of government is to maintain the stability, to have a low-tax environment, at the same time have a deregulatory attitude to dealing with some of the problems that we are have inherited from history. And these are the things that we want to do and we want to be the natural location for people wanting to form and develop their creative industries in the new technologies in the world. And we will do everything we can with a light touch regulatory regime to make that possible. 

Chairman: Fantastic. So we look forward to a light touch regulatory regime Prime Minister.

Prime Minister: Absolutely.

Chairman: We will take questions now from the audience. So if you have questions please step up to the mikes and please ask your questions. We would love to have more than one question at the same time so we can get a lot of questions in.

Question: Prime Minister, I am from India, I had the pleasure of hosting you in India at the CII event.  You spoke about the cartel being operated by Opec.  The Prime Minister of India on the 29^th of last month said something to the same, that the Western action this time in the third oil crisis has been weak, if not absent.  When will the global action be formed against the rising fuel crisis?

Question: Prime Minister I wondered if you could elaborate on the lessons that politicians can learn from the success of the web, in particular the extent to which it has acted as the solvent of hierarchy, and what Don Tapscott has called the net generation now, acting much more on peer-to-peer recommendation than on old habits of deference, and what influence the web might have on political practice in the future?

Question: You gave a very eloquent speech about globalisation, but I was thinking that inside Europe there are two things that the UK hasn’t done:  one is to join the euro, and the other one is to open up in Schengen. I wanted to hear your comments about that.

Prime Minister: Well my goodness.  Shall we start with the last one?  I want to see Europe develop. The problem for Britain with the euro has been that our economy has never been properly aligned with the rest of Europe to make it possible for us to join the euro without either causing huge immediate problems for the economy or requiring a massive amount of adjustment for that to happen.

So the argument is not about the principle of joining the euro, and about the principle of the single currency, it is about, because of our housing market and other factors in our economy and also the size of our financial services industry, what would actually happen to the British economy at the moment of joining the euro.

And so we continue to assess whether we want to join the euro and whether it is right to do so, but it is not a problem of principle, it is a problem of the detailed convergence that is necessary.

And I do think that while the euro was a great technical success in getting it moving with the currency now, with so many countries holding it, that there have been big problems of adjustment that have left Germany growing very slowly for many years, some countries with very high inflation now, not able to cope with the lower interest rate that exists in the euro area.

So while it was a great technical success, there are problems that I think have held back growth in the European economy. And so the issue for us is a great practical one of what would be the impact on the British economy if we were to join tomorrow or in the next year, and we will continue to assess that. 

I think the bigger issue at the moment is obviously what is happening to oil prices, and it is, as people will recognise a scandal, that 40% of the oil is controlled by Opec, that their decisions can restrict the supply of oil to the rest of the world, and that at a time when oil is desperately needed, and supply needs to expand, that Opec can withhold supply from the market.  And it is also a scandal in my view that it is an organisation that works very imperfectly, that if one country doesn’t turn up at a meeting then no decisions are made, and so this can hold back the development of the world economy.

But there is a bigger problem, I mean let’s be honest about this, there is a bigger problem that the supply of oil that is available over the next few years is less than the demand for oil. And I think people know that this year, next year, and the year after, despite the measures that have been taken to increase the supply of oil, that demand particularly from Asia is exceeding that supply.

And until we have a proper dialogue between consumers and producers that bring supply and demand into a better position in oil, we will continue to have problems. And yes, there may be elements of speculation, and yes there may be elements where people have unfairly restricted supply as an individual member of Opec, but we have also got to deal with the supply and demand question.

That will demand in the long term other sources of fuel, that will demand in the medium term greater energy efficiency and the use of existing fuel, and getting better value from the existing oil fields, getting a higher amount of production from these fields.

But it also demands that I think first of all that it should be at the centre of the agenda at the next European Council meeting, it should be at the centre of the agenda of the G8, a realistic dialogue between consumers and producers has got to happen, and that would be the start of breaking down the control that has existed by a cartel.

So it is not just a short term problem, there is a bigger long term problem about matching demand to supply. And it is exactly the same problem that we now face in food, where there is a shortage of food because the demand for food, particularly coming out of Asia as a growing country of consumers, is greater than the supply and we will need to make very great changes in the way that we organise food production in the next few years. So these are big challenges. 

In my time as Chancellor I saw the oil price at $11 a barrel on one occasion, and now it is $125, 126, maybe nearer 130. So we have had a tenfold rise.  In any other decade that itself would have brought a recession in almost every country affected by this, and of course it is causing problems now, but I believe that we can come through this with the proper management of resources.

Mathew asked a third question that I think is really relevant. If we look at the potential for the web it is about transferring power to people as individuals.  And if the social networking, and the blogging, and everything else that is happening, it gives people power directly to influence change. And I think what is going to happen round the world is we used to say if only people could communicate with each other, if only people could connect, if only people could find that they had common ground with each other then things would change. Now people are in a position to do that.

And I believe that once people recognise, not only that they can communicate with each other but just how much common ground they share with each other, how much across the different religions, there is a similar view of the world, how much across the different continents, people have common interests that they want to develop, then I think that people power will become an explosive force in history, perhaps the most potent power in the hands of the world for the future, and I think it will start changing not just domestic policy in individual countries, but change the way we run foreign policy.

If for example Rwanda was happening now, then I do not believe that the world would have been as silent as it was because people would have known what was happening within the country and people would have been moved to action. And yes, it is true in Burma that we have not been able to get all the supplies of food into Burma and shelter that we want, but now a regime like Burma cannot hide from the world what used to be hidden when there was a cyclone, or when there was an earthquake, or when there was a famine, the world never got any information at all.

So the world is changing and direct people power is going to be a powerful force not just in domestic policy, but in foreign policy in the years to come.  And I do not believe that the old idea of foreign policy run by elites in the interests of the few governments talking about mutual interests rather than about the values they share, can be the same again. I think values and what people think about what is happening, whether it is a famine, a cyclone, or a repression, will start to influence the way people pressure governments in every part of the world.

The problem however is that our international institutions are not strong enough to cope with the global changes that are taking place and we will have to reform the IMF, the World Bank and the United Nations if they are going at a global level do what the people of the world will increasingly demand them to do, and that is to act in situations that people find unpalatable.

Chairman: So am I right in paraphrasing that that you expect the web to drive more responsibility and accountability to our elected leaders?

Prime Minister: Yes. 

Chairman: And will we see a lot more ‘coups de blogs’ and ‘coups de social networks’?

Prime Minister: ‘Coups de blogs’ and ‘coups de texts’, yes!

Chairman: Fantastic. I am looking forward to [INAUDIBLE] government.  Any more questions from people in the audience?

Question: Prime Minister, you have spoken very eloquently about the need for open economies, for light touch government regulation. But I wonder whether in the wake of Northern Rock it isn’t legitimate to ask whether that light touch regulation has been sufficiently robust, and whether really in the UK, in the United States, the regulatory environment for financial services actually needs to become not lighter, but maybe if not heavier, certainly more careful and more thoughtful.

Question: You talked a bit about politics on a global scale.  I am just wondering how you saw the web and technology changing politics at a local scale, and also how that affects communities in the future.

Question: I think my question is similar.  I am from Turkey.  Actually I am struggling with two things.  One was the notion of nation-states, because all around the world we are still pretty much governed by nation-states, but how do you think the internet will affect the notion of nation-states because nation-states are basically based on religion, language and a common history.

But nowadays a person in Russia might have a more common interest with a person in the US than their counterparts in their own country. My second question is how this will affect politics. Do you think for example we are going to have elections every four or five years and are we going to have representation by proxy, now that we can respond more quickly to many things in the world using the internet?

Prime Minister: Well these are fascinating questions.  Let’s go to the financial services first.  I think one of the issues that arises from the credit crunch is this, that we have national systems of regulation and supervision, but we have global capital flows, and unless you have some form of financial stability forum coming together at a global level, bringing together the supervisors and regulators, you are always going to be behind events.  So what was happening in America was affecting Europe and affecting the rest of the world, but we simply have had national supervisors, national regulators trying to deal with the problem.

I think what we have learned from Northern Rock also is this, that regulators were dealing with issues of solvency when actually the problem was issues of liquidity and they hadn’t really been addressing themselves to that.

So the system of regulation can remain light touch, as it should be. I believe our Financial Services Authority is moving to a lighter touch of regulation, but at the same time you have got to deal with issues that are not issues of solvency only, you have got to deal with issues of liquidity. And most of the problems that have arisen in the last few months have not been about the solvency of institutions, they have been about the liquidity available to them, and the regulatory system was simply very poor at picking that up.  And I think the regulatory system will change over time.

Why I say light touch regulation is the way of the future is this.  Think of a risk-based approach to regulation as the best way forward.  That instead of governments requiring every company to submit returns and requiring information from every company, and sending inspectors to every company, which was the old system under the Industrial Revolution days when people were afraid that a factory would hire child labour unless there was an inspection every year.  

Think of regulation in future as risk-based, so that only one percent, half a percent, of firms are supervised every year as a measure of the risk that you assess is in the system, and I think that would cut down the forums, cut down the information requirements, cut down the number of inspections, and I think you are getting to a different view of the industrial system. 

In the Industrial Revolution people assumed that unless you had these regulators everybody would do wrong.  In the 21^st century you have a concerned public opinion, you have engaged employees, you have pressure groups everywhere, you have responsible management and so the system of regulation has got to reflect some quite different approaches to the way they govern their affairs.

So I see regulation being light touch because we have changed the nature of how it is applied, but it cannot avoid some of the problems that you face, like liquidity in the system and its financial services regulation.

The second set of questions are about the power of the internet to change the political system. I should think it is already changing the political system. We have hundreds of thousands of people doing e-petitions to Downing Street already, we have a huge number of people with online petitions in different communities trying to change things, we have the ability to organise at a local level through the internet and community television and everything that are happening already.

But why I think it is more revolutionary for the way we conduct international policy is because I think the internet gives, for the first time, people the chance to organise together across frontiers. 

Now it is true that people can live in one country and their heart can be in another, and one of the problems we have with terrorist activity is with people moving between different countries. But if you have an international policy that is increasingly shaped by people who can come together across borders, it would change the whole nature of the response of the international community to events.

And you cannot have these behind the scene deals, you cannot have these back room fixes, you cannot ignore problems that exist in countries where information is coming out of these countries already, and you can see people being able to report information across frontiers in a way that can change the behaviour of governments.

So if I use Rwanda as an example today, perhaps an international campaign on Darfur is possible in the next period, or Zimbabwe, or Burma.  And I do believe that people coming together to express their anger, or their outrage, or their concern about particular events will force international institutions to have to change and force politicians around the world in different countries to have to come together to change their decisions.

But if you have got a global society in the making, I just repeat you are going to have to have global institutions that work, and none of the existing global institutions created in 1945 for a world of 1945 is working for the world of 2008. 

We have no world institution for the environment.  I mean the only way we are ever going to be able to persuade the poorest countries, developing countries, to invest in energy-efficient or environmentally sensitive forms of technology, instead of building coal powered stations to do other things, is if we have got some means of providing finance for them to do it.

But we have got no international institution at the moment that is capable of doing it.  So you can have all the Kyoto agreements, but if poor countries do not have the resources provided by the international community, either in loan or grants to invest, they will not be able to do it. So you need an international institution that can deal with some of the problems of climate change, and we do not have that at the moment, and equally you need international institutions to deal with stability in broken down countries and you need an international institution to deal with some of the problems of the economy.

So global mobility of labour, global mobility of capital, global sourcing of goods, global society, you will need some global institutions that will properly reflect that global society. And I believe that is one of the challenges of the next year or two, that for the first time Europe and America can actually come together in common purpose to rebuild the international institutions that were built for 1945 and are no longer the institutions we need for 2008.

Chairman: Thank you very much Prime Minister.  It looks like we are now going to have to worry about global regulators as opposed to local regulators.

But we will take the last set of three questions, keeping according to the time.

Question: Prime Minister I am very interested in what you are talking about in terms of the protectionism as well as new global institutions. With the United States elections this year it appears that progress in those areas could be under threat in a way it has not been in a long time, especially depending who might win the election.  The protectionist rhetoric in the United States is perhaps higher than it has ever been before.

Are you concerned about the US elections and in particular about what the implications might be of a Democratic victory where they have been very vocal in wanting to renegotiate virtually all the trade agreements the United States has?

Question: My question actually comes more not from my company’s perspective but from our membership in the cyber-security industry alliance where we have a dialogue with, we advise and lobby the EU and Capitol Hill in terms of internet security issues. 

I can’t miss this opportunity to ask the Prime Minister to give us your thoughts in terms of consumer rights on the internet and the rights to privacy and so on. This is a very big issue, as you say this is an open, flexible industry. 

That is a very positive thing but at the end of the day where does the consumer stand, his or her rights to privacy and so on.  You can send us a strong message in terms of what the British Government’s thoughts are on that from a British and global perspective.

Question: My name is Annette Harris, I am Professor of [INAUDIBLE] and I just became a regulator two months ago with the Dutch version of OFCOM and I am trying to find my way in how to best regulate. So I would be very grateful for your advice.

Beneath all the discussions that we have I think there is a very fundamental shift going on between what on the one hand we always used to have, which was autocratic structures which were based on expertise, first was the wisdom of the crowds.    And even if you go globalised, we see that many, many political systems tend to be more autocratic than democratic. 

If you look at companies they are still autocratic, and the autocracy is not only about power but it is also about a very deep felt belief that experts know better.  And so this whole tension between experts who know better and the wisdom of the crowds, where some people have doubts if you only look at the searches we had last week, that is the best wisdom. And so this transition between experts and people’s wisdom, I think that is beneath many of these discussions. And so I would like to ask you how do you see this balance in future?

Prime Minister: Let’s deal with the first question about protectionism first.  I had the great honour when I was in America a few weeks ago of meeting all the candidates for President who are still in the race.

And while I am not a voter I was able to have a chance to meet all of them.  And I genuinely believe that the relationships between Europe and America can be so improved over the next few years that we can actually make a huge difference to the debate, whether it is about protectionism or whether it is about the rebuilding of global institutions. 

Incidentally, all the Presidential candidates claim to have Irish ancestry, including John McCain, Hillary Clinton and Barack Obama. But I genuinely believe that whatever the rhetoric of the campaign, people see the opportunities to do something to build a better global economy by cooperation.

But I do worry about protectionist sentiment and it is perhaps to be understood as a natural reaction to people facing explosive change that is happening in their lives. And I still repeat the point I made earlier, that there is a contradiction between the openness that you as an industry and the flexibility demand - in fact the only way that you can be successful as an industry is by the openness round the world - and the flexibility that is available to you to develop and the protectionist sentiments, and we have got to fight it.

I think too often we are allowing protectionist sentiment to grow without actually taking it on at root and saying, look, the issue is not that there is going to be no change, there is going to be change, but we will help guide you through these changes, we will give you the skills that are necessary to get the new jobs, rather than trying to cling on to the old jobs, we will give you the sense that the world economy can move forward  and there can be prosperity for Americans and European citizens and it is not a zero sum game that only China, India and Asia are going to benefit in the future.

When you look at the opportunities available for the future and the intellectual value added goods that are going to be created in the future, it is Europe and America that are likely to have the benefit of creating most of these in the next few years. 

So we have got to present a far more optimistic picture to deal with protectionist sentiment, but I do agree with you that unless you actually tackle protectionist sentiment head on, it will come back to hit every industry.  I mean you are the most global of industries and you in a sense have a duty to put forward the case for the success of an open, flexible, global economy showing people how they as consumers, as well as workers, can benefit from it.

The internet and problems of safety for children dealing with pornography and violence on the internet, the problems for the industry of dealing with piracy where things appear to be taken, and of course the issues of privacy, now these are the three big issues that are going to come up. 

I would just say that we have published in the last few weeks the Byron Report about safety for children on the internet and we are trying to get the right balance between the protection that is necessary for children using the internet, and I can see that as an issue with a young son who is at the age of 4 or 5 wanting actually to be on the internet, and at the same time the need not to hold back the great technological innovation that the internet brings.

So we are proposing an Internet Security Council where people can discuss these issues.  It is a light touch, I repeat to you, that we want to see but I think there is a great deal of education to be done for parents about what they do.  I think Tanya Byron used this analogy that if you send your children out to go swimming you take all the sort of precautions if they are going to a pool about how they are going to be safe and so on if they jump in, but if children are on the internet most parents don’t really think about what is happening until they find out that something wrong has hit their child. And so we need to have that debate and I think it is more about a debate and the education of parents, and I think that is the way forward.

The wisdom of the crowds, well I am a politician subject to the wisdom of the crowds, so I believe in the wisdom of the crowds. But I think, just to come back to my first point, that we don’t have a sufficiently informed and educated debate at the moment about what is really happening round the world.

It is not that we are in silos, because I think all of you are playing a part in developing an argument right across the world about what is happening in your continents and what is happening to globalisation.  But I don’t think the strength of the campaign to put the issues about the opportunities and possibilities of globalisation in any way today rivals the fears and the prejudices that are created by people who want to hold change back.

And I think it is food for thought for us because if we genuinely believe, as I do, that an open and flexible and free-trading globalisation is the only way forward, but it has got to be inclusive, otherwise people will respond negatively to it, then we are perfectly capable of putting the argument that shows just how much benefit people have from the opportunity of globalisation already.  

But I think even more so, we are capable of putting the argument about how much more people can benefit in the years to come. So that debate is perhaps one that we should be stimulating at a wider level than we are doing at the moment.

And my plea to you this morning is don’t allow the case for globalisation, which is at the centre of the success of this industry, not to be put at a time when protectionist sentiments and fears about change are growing in the population.  I believe we can combat these fears, but I think we have got to do it together and I look forward to business and government working to put the case for globalisation and for its successes in the future as we create a truly global society for the first time.

Chairman: Can I reassure our guest that people are just searching for Brittney Spears, they are not about to vote for her instead of Obama, Hillary or McCain.

Well Prime Minister you have mentioned your children, and one of the things we have been talking about earlier is on April 30^th the internet turns 15, and Google turns 10 in September. So I think in the internet we are in the adolescent phase of our industry, so it is a bit like kids, you love to have them, you can’t live without them, but you are really concerned when they are between 11 - 18.

So we are at that point in time of our industry, so any light touch regulation or guidance that you can give us would be very useful.

Prime Minister: Well you know what they say in Britain, that the first 500 years of any institution is always the most difficult.

Chairman: Well on that note, thank you very much Prime Minister.