Tories have fallen for the Silicon Valley fantasy hook, line and sinker

“Right now, Silicon Valley is the leading place in the world for hi-tech growth and innovation,” Jeremy Hunt told business leaders last week. “But there’s no reason why it has to be so predominant.”

Only he didn’t. Those words belong to David Cameron, in a speech made beside the Old Street roundabout in November 2010. What Hunt actually said last week was this: “I’d like to see a British Alphabet (the parent of Google), I’d like to see a British Microsoft … a homegrown company with a trillion-dollar [market] cap…. That would reflect my ambition for the UK to be the world’s next Silicon Valley.”

Fourteen years have elapsed, and ministerial ambition has not evolved. It still regards creating a British Google as something to be desired: a “yardstick of success”,  Hunt affirmed. And he still thinks we’ll be impressed by this ambition.

Now here’s something else the Chancellor didn’t say.

“For the first time in history, humans have landed a craft on a comet. It was British, and it was made in Stevenage. And our Mars Rover is far superior to Nasa’s, as the world will soon see.”

That wouldn’t be a lie. Mr Hunt could also have boasted that “we’re proud to have six high-technology manufacturing companies in the UK valued at over a billion pounds”. And that would be true too.

Dyson turned over £7.1bn last year, is admired the world over, and is currently growing faster than Google. Only a little faster admittedly, but at 9pc it’s going at a healthy clip.

Renishaw began life specifically to solve a problem with Concorde’s Olympus engines, and has grown into a world-class company: nobody does precision measurement quite as well. A Questor stock tip, the firm is worth over £3bn.

There’s no shortage of British technology brains generating wealth at Bamford or Rolls-Royce. Or at Oxford Instruments, whose late founder, Sir Martin Wood, invented the astonishing superconducting magnets that would eventually make MRI scanners possible.

Or at Airbus’s space division, once GEC Advanced Electronics, which designed and built the Philae spacecraft that landed on a comet. This is all British technology, and it even flourishes in places we don’t expect. “Our industrial estates are now the true cathedrals of wealth creation,” I explained recently.

No one disputes that these are all technology companies – what else would you say they do? – solving the very hardest technological problems. But what Silicon Valley has achieved is to redefine and degrade the word “technology” so that it largely refers to internet companies, very much like its own.

Conservative ministers have bought this hook, line and sinker. Hunt was hosting a “summit” to talk up the London Stock Exchange by encouraging more firms to list. But by making the world’s largest digital advertising company the zenith of our ambitions, Hunt is denigrating what we actually achieve. He’s talking Britain down.

We may ask whether a “British Google” is practical or even desirable. The two trillion-dollar companies Hunt cited are very rare beasts indeed. Microsoft and Google are once-in-a-generation successes who through skill and good fortune manoeuvred themselves into a dominant industry position. Microsoft was the biggest beneficiary of the microprocessor revolution, and Google of the internet. These don’t come along very often.

Their success also required considerable such ruthlessness. In 2000 a judge ordered Microsoft to be broken up, but nobody wanted to take the pieces, so it remained intact. Google faces a number of major competition trials, placing it only months away from a similar break-up order.

Last week it tendered a cheque for the full amount of damages, in case it lost. It’s also trying to switch the case from a jury trial to a bench trial.

In reality, we just don’t have the domestic scale to give our software companies a running start. “We don’t buy much software in Britain,” one successful software founder told me last week. He pleads for governments to make exporting software easier to the big market that matters – the United States. Trade group TechUK echoes this plea.

What technology companies want is simple: a more business-friendly environment. Sometimes the best industrial policy you can have is simply for government to take the foot off the throat of business.

But Hunt has affirmed Rishi’s 2021 corporation tax increase from 19pc to 25pc, and ended the super-deduction. “Dyson now faces rocketing corporation tax – wiping out any tax credits for research and development,” Sir James himself wrote last year.

And something else Hunt didn’t say – understandably perhaps – is that the United States really does not like market competition. Two decades ago, British online gaming companies were faster to market, were considered far more trustworthy, and out-competed American rivals. So the US government made online gaming illegal, and arrested our executives when they showed up at US airports.

“The end of all our exploring will be to arrive where we began,” TS Eliot mourned in Little Gidding. For the Conservatives, their curiosity about British technology began and ended in the same place: California.