AS a veteran of four recessions, which he studied as both an academic and from inside the Treasury, Lord Burns knows a thing or two about economic crises.
But the Santander chairman, who was in the North East yesterday to officially open the new Newcastle University Business School building, admitted that even he is not brave enough to predict when the current downturn will end.
Lord Burns, who grew up in County Durham before working at London Business School and then in the Treasury from 1976 to 1998, performed the ceremony before delivering a keynote address on what we can learn from past recessions.
The economist acknowledged that the current downturn had some common factors with previous recessions, but the picture today was complicated by the seizing up of credit markets and the crisis facing the banking sector.
Recalling earlier recessions and the government measures taken to deal with rapidly rising inflation, he admitted that the current round of spending cuts “appear modest in comparison”.
“The misery of the 1970s puts today into context,” he said.
But Lord Burns, who is also chairman of Channel Four, said one common feature across all the recessions he has experienced was the tendency to underestimate the ability of the economy to recover. “There is always far too much pessimism,” he said.
The continued growth of many international markets and the emergence of a new middle class in countries such as China, India and Brazil should also encourage export-focused businesses, he added.
“It is not the strongest businesses that will survive, but those that are able to adapt,” he said.
Earlier Lord Burns, who was born in Hetton-le-Hole, spoke of his fond memories of the North East. A keen Sunderland fan, he admitted that he had many agonising afternoons at St James’ Park, which is adjacent to the new business school building.
He was in the region to officially launch the new Barrack Road home of Newcastle University Business School, which opened for students in September. Property group Downing developed the 100,000 sq ft structure as the first phase of a city centre regeneration scheme on the former Scottish and Newcastle brewery site.
The building – which has already won the Lord Mayor’s Design Award in the “new build” category – was opened by Newcastle University vice chancellor Prof Chris Brink and Lord Burns.
Newcastle University Business School director Prof Ian Clarke said it was important to have a place for the 3,000 students to meet and learn, but that the building would also be home to events for the wider community.
He said: “We’ve been running for several years across three buildings in the community, and this new building brings everything together for the first time.
“Having things like the cafe space and the social spaces for undergraduates, masters level and MBA students makes a tremendous difference in terms of serendipity and bumping into each other.
“The facility is also helping us engage with businesses. We want to have these conduits open. Compared to most business schools I’ve worked in, we do events here really well. But that’s only part of the equation. We need to have events here that say we’re open for business.”