Orson Welles said film-making was the biggest electric train set a boy ever had. He was wrong. A new high-speed train line would be, if the boy or girl grew up to engineer it.

But in Britain, the train set is broken and has been packed away in the attic. We're not proud of industry and we certainly don't want our kids to grow up to be engineers. It's a tragedy. It never used to be this way. We need to rediscover the power of engineering, its impact and contribution. It can stimulate young minds and it can stimulate the economy.

Let's start with the makers, breakers and remakers - children. Children are mini-engineers and it's their rite of passage to pull anything mechanical apart to get at the guts. As a child, I pored over Eagle magazine cut-aways that delved into the workings of everything from Bloodhound missiles to offshore oil rigs. Rather than the aesthetic, it was the innards that intrigued and inspired. The inventions all seemed to herald a brave new world of British prosperity that never transpired, at least not in its engineering guise. Instead, we became obsessed with the surface (but more of that later).

So the young are innately curious about how and why things work. Yet what happens between childhood and adulthood? We stamp it out of them. Engineering gets stigmatised and we encourage our kids to become "professionals" - lawyers, accountants, doctors. Unlike in France or Germany, engineers are a bit of a nonentity here. Engineering is almost a dirty word. We're told it's "old industry" and that we are a "post-industrial nation".

Part of the problem is that engineers are not accorded the status they deserve. We celebrate designers and architects, but forget the clever people who turn the theory into reality. The Millau bridge in France was designed by Norman Foster, but it was French engineer Michel Virlogeux who made it work. A magnificent achievement, but whose name do people remember? In 2005, Ellen MacArthur became the fastest person to sail round the globe, but little was made of Nigel Irens, who engineered her trimaran.

And the snobbery extends to education. Design and technology is struggling to shake off a dreary image and is lumbered with a perception that it is secondary to so-called academic subjects. Those who study it love it. But half of the UK's potential engineering stars are already out of the running by not even taking D&T as a GCSE.

This negativity pervades government and big business. Engineers aren't trusted with money. I couldn't get anyone to finance my ideas and I could only get a loan by using my house as security. But who understands a product better than the people behind it? Successful manufacturing is born of pioneering engineers and inventors. Look at Japan's Akio Morita at Sony and Soichiro Honda. Both companies are finding current conditions tough, but you cannot ignore their spirit of inventiveness.

The problems come when the moneymen take the reins instead. Take the British car industry. In the 1950s, half of the world's cars were manufactured in Britain. But beginning with the formation of the British Motor Corporation, the car industry's emphasis on invention gradually bowed to commercial pressure and government intervention. In a desperate effort to balance the books, the industry was soon ground down by internal rivalries, lacklustre designs and labour disputes. Good invention was forgotten.

Today, besides the recently appointed science minister Lord Drayson, engineers are not represented in the highest levels of British government. In contrast, Hu Jintao, the Chinese president, graduated in hydraulic engineering from Beijing's Tsinghua University, and Wen Jiabao, the Chinese prime minister, is a postgraduate engineer. China produces 14 times as many engineers as we do.

While we will struggle to compete with growing industrial economies on the speed and efficiency of assembly lines, we can compete through ideas and technology. To do this we need bright engineers. But there aren't enough. Just 4% of undergraduates read engineering and fewer still actually end up in the profession.

This is worrying. Making things is still the future. Manufacturing accounts for half of our exports. But we import more than we export to the total of around £8bn a month. That's more than £90bn a year in the red. Unlike the US, we don't have a huge internal economy we can rely on to help support us in this difficult time. The UK can't afford to be protectionist - we've always been exporters. The trouble is that we're running out of things to sell.

Besides the commercial world, the importance of engineering to us as a society cannot be underplayed. Last year, the first British tidal turbine was connected to the national grid, producing enough power for 1,000 homes. The UK accounts for half of Europe's tidal power and it's been estimated that tidal energy could provide a fifth of British energy needs. These initiatives are what we need to excite and inspire people.

If the government backed these large infrastructure projects, as in France, their importance would be recognised, helping to restore engineering's contribution to our economy and society. I worry that for all the rhetoric about addressing attitudes to science and industry, the action is not dramatic enough to shake the UK out of its apathy.

President Obama has got it right with his "smart grid" project, an electricity network that will use information technology to link the US to renewable sources of energy. Not only will this create jobs and stimulate the US engineering, but in the long run it will save billions on the national electricity bill and cut the country's carbon footprint. Meanwhile, in the UK, projects get caught up in planning regulations, never to see the light of day.

We need to rediscover that fascination with that train set of our childhood. We've built our modern economy on the service sector, loans, banking and the dotcom bubble. Now that's collapsed, we should seek to base it on something long term with solid foundations. If we don't, we risk losing an already weakened position for good. Making money from money should be replaced with making money from making.