Britain is not recovering from the financial crisis. In the fourth quarter of 2011, the British economy contracted by 0.3% and in the first quarter of 2012 this pattern continued with a contraction of 0.2%. After a year of quarterly growth figures of less than 1%, quarter on quarter, the government has finally produced the inevitable two consecutive negative quarters, the standard definition of a recession. In comparison, after the crash of 1930, over the same amount of time the British economy had long since recovered the volume of economic activity which had been lost, leading this economic crisis to be at least statistically worse than the Great Depression. And yet, despite this failure, there are still those in the U.S. who wish to implement the same approach here.
So why has this happened? Why has British government failed to act and prevent this outcome? As I’ve discussed previously on PolicyMic, the ruling Conservative Party along with their willing coalition partners, the Liberal Democrats, have been enforcing a strict neo-liberal economic agenda which has been producing terrifying results. Government cuts are due to eliminate a fifth of all public spending by the scheduled end of this parliament in 2015, primarily by eliminating welfare and services for the nation’s most vulnerable. Simultaneously, Chancellor George Osborne has awarded tax cuts to the countries’ wealthiest in the same week his party’s treasurer was caught selling access to the prime minister for large financial donations.
The usual excuse given by the right for the UK’s economic failure is the weak European market. Unfortunately, this argument no longer holds water; the reason the continental economies are performing poorly is because they are being forced to make the same idiotic fiscal adjustments as inflicted on Great Britain. The dominance of the EU by Nicholas Sarkozy and Angela Merkel, goaded on by arch-neoliberal and European Commission President Jose-Manuel Barroso will only guarantee more suffering for Europe’s citizens and weak short term growth. Even Dutch politician Geert Wilders recognized the folly of austerity and brought down the entire Dutch government with his opposition.
Despite all of this evidence pouring out of Europe, U.S. Republicans seem to think this is the best path forward. The Ryan Plan, endorsed by Mitt Romney, contains a series of radical structural adjustments, destined to eliminate the meagre growth the U.S. has been able to sustain. No one could say the U.S. economy is booming, it is at least growing. For the first time since the economic collapse, the UK’s unemployment rate now exceeds that of the U.S.
Things look grim for Britain, but despite the failing economy, increasing unemployment, and the impending resignation in disgrace of the Minister for Culture, Jeremy Hunt, David Cameron shows no remorse. We can only hope the Liberal Democrats see sense and renounce their partnership with the arrogant posh boys who run the country. The Republicans must recognise the failure of Britain’s Conservative party and not doom America to the same fate that besets Europe.