February 4, 2023

Lakeview Gazette

Complete News World

Great Britain is rudderless and in crisis Inflation, declining health, water scarcity, high energy rates

Double-digit inflation for the first time in forty years, real wages falling to their worst levels in decades, and transport strikes are some of the signs of widespread discontent. The national health system is on the brink of collapse, high summer temperatures have left large parts of the country without water due to drought, energy prices are set to double in October and labor unrest is on the rise. Even criminal lawyers have announced a strike.

Sometimes it seems that there is no sector that works in Britain. Prime Minister Boris Johnson resigned in June and his replacement will not be announced until September 5. This G7 country’s ship is damaged, diverted and no one takes responsibility.

A tragic collapse

They have long sounded the alarm in the conservative media. “Almost nothing works in England,” says the conservative weekly “The Economist.” “The country is creaking,” finds the “Financial Times,” another pillar of the establishment. One of the most lapidary diagnoses belongs to the star columnist of the ultraconservative morning newspaper “Daily Telegraph”. “Our surprisingly rapid decline is sad and not surprising. “We are nearing the end point of a quarter-century of political, intellectual and moral failure in which most of our political class is complicit,” writes Alistair Heath.

The problems go beyond the pandemic or the war with Ukraine. “The era of Covid-19, Brexit, the war in Ukraine and the climate emergency are exposing fundamental flaws that have been festering for decades,” says columnist John Harris in The Guardian.

Who is investing?

The mantra of the Conservative government that took office after the global financial meltdown in 2010 was that the problem was the fiscal deficit and that the solution was to stimulate private investment by cutting spending and cutting taxes on the rich and corporations.

In the 1980s, Margaret Thatcher turned this formula into doctrine. The conservatives of the 21st century did not change their rhetoric: the results were the same as the “Iron Lady”.

Despite having one of the lowest tax rates, the UK is at the bottom of the table for private and public investment among G7 countries. “This lack of investment has been going on for decades. An obsession with cost effectiveness has allowed infrastructure to fall into disrepair rather than maintaining and improving it. The United Kingdom has more jobs than Germany and France, but we lag far behind in terms of productivity because we invest so little in key sectors including technology, training and research,” says The Guardian’s economics editor Larry Elliott.

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Two examples

The drought made it clear this summer that the corporations that manage the water supply, privatized in the 1980s, have not built any new reservoirs in recent decades despite a population growth of tens of millions. The same carelessness is seen in the maintenance of a Victorian system. As a result, around thirty million people today have restricted access to the water and much of the English south coast, from Cornwall to Devon, is banned from entering the sea due to water pollution.

As with other corporate sectors, taxes on corporate entities have been reduced from 26 percent to 19 percent in 2010. But instead of spurring investment, the profits were used to pay dividends to shareholders: the equivalent of seventy billion dollars (57 billion). pounds) over the past thirty years. Executives of departmental companies also did not miss the party. Over the past two years, amid the pandemic, more than $35 million in bonds have been issued. By comparison, Scottish Water, out of state hands, invested around 35 per cent in infrastructure per household over the same period.

The energy sector, which has booked windfall profits from the war, is driving up prices like a charm. An eighty per cent rise in rates was confirmed this Friday, which will take effect from October 1 ahead of a harsh English winter. Shareholders and executives, happy: not so much the public. Even in traditionally conservative areas such as Surrey in the south of the country, voters are disillusioned with the privatized system and ready to switch parties. “I’ve always voted Conservative, but I’m not going to do it again. The profits made by the water and energy companies are a scandal. They should be going to jail instead of earning a million dollar bonus,” says retiree Mary Barnaby.

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Affiliated country

At the public sector level, investment freezes and cuts since 2010 have meant that the National Health Service (NHS) today has one of the lowest number of hospital beds per person in a developed country, as noted during the pandemic. A virtual wage freeze since 2010 has led to an exodus of nurses and doctors, an exodus partially offset by the hiring of specialists from developing countries. NHS staff are becoming UN-like in their ethnic mix, yet one in ten nursing posts remain vacant.

In Germany, Spain or Estonia, the British government announced cuts equivalent to 2.5 billion dollars, while investing in the railway sector to get out of the crisis caused by the pandemic. Eight strikes since June 21 have paralyzed the rail network by half.

Mick Lynch, the general secretary of the RMT, the railway union, has warned that current discontent could end in a practical general strike (the last one was in 1927). “It is a matter for the labor union to decide. But what we are going to see is a concerted strike in the education, health, transport and private sectors. There have been clear signs of this labor unrest in the past two months: the cancellation of thousands of flights in mid-summer, forced labor at the port of Felixstowe, which cut 48 percent of container trade, and strikes at oil companies. , factories and even on Amazon.

In August, the inflation index for the previous twelve months exceeded ten percent. With energy rates effectively doubling from October, the Bank of England expects a 13 per cent hike in the coming months. The calculation is that about fifteen million people would be in so-called “energy poverty” (they pay ten percent of their income for gas and electricity). In food banks for the most disadvantaged sectors, many people don’t buy potatoes because of the costs involved in cooking them: in a British winter, many people find it uncomfortable to light the stove or eat them.

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Still the same

A virtual acebali has been added to the crisis since Boris Johnson resigned in June and has been in office without missing a wedding and a holiday in a headless government. In more than half of the ministries, decisions are not made until there is an alternative: in the press they baptize it “zombie government”.

The problem is that both candidates offer more of the same in his place. The favourite, Chancellor Liz Truss, is promising £27 billion in tax cuts that will support companies and billionaires to spur investment in a country still dealing with a financial hole from the pandemic and Brexit. His rival, former finance minister Rishi Sunak, is a bit more cautious and says it’s a target to be reached later. But without that taxing mantra, there is little or nothing to his plan.

A poll last weekend gave Labor an eight-point lead over the Conservatives and put their controversial leader Keir Starmer ahead of him as a better prime minister than Johnson, Truss or Sunak.

What’s coming?

The consensus is that the new prime minister will enjoy very little legitimacy: he will be elected by the Conservative Party’s roughly 200,000 members, most of whom are over 60 or 70 living in rural areas. The rest of the kingdom, which faces strong separatist, social and generational tensions, will play host to Kall in an unacceptable situation in the midst of a crisis. Despite all this, Truss and Sunak are likely to have a brief honeymoon awaiting new governments, albeit tainted by their involvement in Johnson’s cabinet. There has been speculation in some media that whoever wins will try to use this revival of expectations to push for an early election by promoting a massive cost-of-living aid package.

With very little legitimacy and many economic and social loopholes, the government will find it difficult to reach December 2024, even more so in a country with a long tradition of early elections. But beyond political and electoral ups and downs, regardless of party affiliation, the fundamental problems will not go away with a new face.