The UK’s Economic Prospects Continue to Dwindle

If the U.K. is to recover, a dramatic change is needed, and that should start with binning the ‘post-Boris Johnson’ consensus of nationalism, populism, and geopolitical adventurism, all of which have dealt significant damage to the country’s place in the world.

“The United Kingdom lost more working days to strikes in 2022 than in any year since 1989, as employees walked out in large numbers over pay amid soaring living costs,” reads an article on CNN. Last year was, to put it mildly, a miserable experience for the U.K. Despite having mostly recovered from COVID-19, the country’s economy remains in a state of stagnation. Faced with shrinking incomes and crippling levels of inflation, its economic performance is worse than any country in the G7 and the only one expected to enter recession.

The grim economic prospects throughout the country have led to a tidal wave of economic discontent that has manifested in strikes across the board, drawing upon memories of the industrial unrest and upheavals faced in the 1970s and 1980s. In public opinion polls, the current government is deeply unpopular and trails the opposition Labour Party by over 20 points. Many decisions the government has made, including the decision to follow the U.S. blindly in escalating tensions with China, deliberately intensifying the war in Ukraine, and Brexit, among things, are responsible for the economic fallout. The product is a “broken Britain.”

Since the late 1970s, the U.K.’s Conservative Party has premised its economic policy on Neoliberalism, which has religiously adhered to the fundamentals of free-market economics and privatization, even at the staggering expense of the British themselves. While this began with the reign of Margaret Thatcher, who destroyed Britain’s industrial base and created large-scale regional inequalities, it was ultimately continued with the government of David Cameron, who pursued the largest program of austerity the country had seen in a century, gutting the public sector and only deepening the country’s growing inequalities.

People purchase reduced price goods at a supermarket in Reading, Britain, Aug. 21, 2022. (Photo/Xinhua)

The combined long-term impact of these economic policies has been to effectively sacrifice the British working class, shrinking incomes, undermining consumption, and creating an economic model which has made British-led innovation and competitiveness untenable, leading to long-term economic stagnation from as far back as 2008. Politically, the end result of this trajectory has been to create social-economic conflict in the U.K. in the form of populist right-wing nationalism, promoted by the popular right-wing press, which ultimately resulted in Brexit.

The Conservative government has responded to these shifts by injecting nationalism into its foreign policy in order to make up for its domestic shortcomings. While the government of David Cameron was liberal in nature and pro-EU, he subsequently lost the internal partisan struggle over Brexit, as well as the referendum, leading to a new status quo led by Boris Johnson, which has sacrificed reason and economic logic for the sake of populism.

The result of this domestic-foreign policy dynamic, which seeks to mask domestic structural economic failures with imperial adventurism abroad, has become self-reinforcing and reflected in growing damage to Britain’s economy. British foreign policy, with respect to Russia, China, and the European Union, as well as elsewhere, is being driven by ideology, not reason, making the primary drivers of the country’s GDP stagnation and surging inflation. Thus, in 2022, the United Kingdom began to face industrial unrest as workers and unions felt their incomes were no longer sufficient to match rising prices. According to the Office for National Statistics, “843,000 working days were lost in December 2022 alone – the highest monthly number since November 2011,” with “workers in health care, communications, and transportation among those who walked out.”

The economic system that the U.K. adopted in the 1970s and 1980s no longer delivers for ordinary people. Instead, it is dividing the country, and such divisions have only been intensified by more aggressive policies by successive governments and have created economic stagnation. With Britain being a service-based economy, it is failing to grow because people’s incomes are shrinking, and, worse still, the foreign policy environment that the British government is creating goes fundamentally against its own national interest. If the U.K. is to recover, a dramatic change is needed, and that should start with binning the “post-Boris Johnson” consensus of nationalism, populism, and geopolitical adventurism, all of which have dealt significant damage to the country’s place in the world.