United Kingdom: Hard times ahead as recession bites
Britons are “getting poorer,” said The Observer in an editorial. Battered by soaring inflation and skyrocketing energy costs, we’ve officially entered a recession. Disposable income is forecast to plunge 7 percent over the next two years, the worst drop since records began, and already, families are having trouble paying their heating bills. To deal with this fiasco, Chancellor of the Exchequer Jeremy Hunt, the man in charge of Britain’s finances, has unveiled an emergency budget that includes vicious spending cuts and a tax rise that will give the middle class its highest rate since World War II. Hunt is trying to pretend that we’re in this predicament because of global events like the war in Ukraine. But the truth is our misery is the result of 12 years of Conservative leadership. Elected in the aftermath of the 2008 global financial crisis, the Tories used that shock as an excuse to “impose deep and unnecessary cuts” in health and education spending. These “made Britain a much harsher place to live,” where patients wait months for necessary operations and working parents “rely on food banks to feed their children.” The pain from this new budget will “be profound, and it has been sharpened by Tory economic incompetence.”
Hunt is only doing “what is necessary,” said The Times. His predecessor, Kwasi Kwarteng, had spooked the markets with an announcement of billions in unfunded tax cuts that sent the pound plunging and got Prime Minister Liz Truss booted out of office. That left the U.K. with a vastly greater debt burden and much less wiggle room for the budget. At least Hunt’s plan will “prioritize support for the poorest households” by raising pensions and capping household energy bills, even if that cap is also an unintentional “subsidy for those with mansions and swimming pools.” His “sober and sensible” budget will offer the Conservatives “a chance to reclaim the mantle of economic competence.” How could they, asked The Scotsman, when they are to blame for Brexit—the main cause of our economic woes? Just like us, the EU countries have also had to deal with the pandemic and inflation, yet they are managing much better because they share a robust single market. Before we left the EU in 2016, Britain’s economy was 90 percent the size of Germany’s. Today, it’s 70 percent and shrinking. Brexit was “an act of selfharm” that will hurt us for decades to come.
This country has become “a crumbling, sclerotic gerontocracy,” said Stephen Daisley in The Spectator. Despite being better educated than any generations before them, Millennials and Gen Z earn far less than their parents did. While in 1989, half of 25- to 34-year-olds owned their homes, today just over a quarter do. Yet instead of helping the young afford to buy a house, Hunt is increasing pensions for their grandparents. While he did hike the minimum wage to $12.29 an hour, that still falls well short of a living wage. My advice to Britons under 30? Emigrate. “Britain is no country for young men.” Hunt’s budget confirms that the Conservative Party has “no policy” beyond “taking money from workers and using it to buy the votes of Boomers.”