The Poor U.K
Brexit
March 5, 2023
The Core Reason
March 5, 2023How the U.K. Became One of the Poorest Countries in Western Europe
Existence of Work in Progress
How the United Kingdom Became One of the Poorest in Western Europe The United Kingdom opted for banking over industry, austerity over investment, and a closed economy over globalisation
An depiction of the British flag comprised of fractured forms. The Atlantic on 25 October 2022
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Recent months have been difficult for the United Kingdom. The cost of energy is increasing. The national rate of inflation has surpassed ten percent. The British king with the longest reign has died. The prime minister with the shortest tenure has departed.
You probably already knew all of this. In the American media, British news is extensively covered (some may say excessively).Nevertheless, underneath the sensationalised headlines is a story of decades-long economic dysfunction with lessons for the future.
The British government followed an austerity strategy out of concern for mounting deficits rather than productivity or aggregate demand.
The outcomes were catastrophic.
Real salaries declined for six consecutive years.
Faced with what author Fintan O’Toole described as “the dreary worry of diminishing living standards,” conservative politicians sought a villain to blame for this slow-motion disaster.
They presented concerned people with a buffet of frightening foreigners, including bureaucrats in Europe, immigrants, and asylum seekers—anyone other than the actual decision makers who had crippled British competitiveness.
A cohort of older, middle-class, and deeply sentimental voters desired Brexit, and they received it. In the past thirty years, the British economy has chosen finance over industry the British government has chosen austerity over investment, and British people have chosen a closed and less prosperous economy over an open and more prosperous one. The predictable outcomes are a decline in salaries and a shockingly low rate of productivity growth.
Although the British media is concerned that robots would eliminate all jobs, this is not the case.
Thus, the United Kingdom, the first nation to industrialise, was also the first nation to deindustrialize.
Britain sparked the productivity revolution that altered the world, but it presently has among of the lowest productivity rates of any major country.
What was once the most powerful globalised empire in the world has opted to expressly restrict global access to trade and talent.
After Brexit, immigration, exports, and foreign investment have all dropped, which will likely reduce the size of the British economy by several percentage points over time.
Americans who have travelled to the United Kingdom would not recognise the portrait I’m drawing.
Probably because they are only familiar with London and not the entire country.
According to economist Noah Smith, London’s finance success has obscured the economy’s innovation and industrial weaknesses.
Alternatively, as economic researcher Matt Klein puts it, “Take out Greater London, whose wealth rests to an unsettling degree on a willingness to supply services to billionaires from the Middle East and the former Soviet Union, and the United Kingdom is one of the poorest nations in Western Europe.”
The United States has different problems than the United Kingdom.
Politicians must navigate a structurally declining manufacturing sector, a political left that is frequently suspicious of the benefits of economic expansion, and a political right that is in part oriented around a hatred of immigrants.
Opponents of progress can attack industrialization, productivity, and globalisation as legacies.
But, the United Kingdom demonstrates what might occur when a wealthy nation rejects all three.
Instead of transitioning into a post-economic paradise of pleasant vibes, it becomes acrid, chaotic, and illogical.
G.I.T.C
In the American psyche, the United Kingdom is not only our political parent, but also our cultural partner; it is a prosperous nation that brought us modern capitalism and the Industrial Revolution.
But purely by the numbers, Britain is a relatively poor nation. The United Kingdom’s living standards and earnings have notably lagged behind those of Western Europe. In fact, real earnings in the United Kingdom are lower than they were 15 years ago, and are set to fall further next year.
This catastrophe took decades to develop. After World War II, the British economy expanded more slowly than those of the majority of continental Europe. During the 1970s, the British were debating why they were slipping behind and how the previous empire had evolved into a somewhat insular and sluggish economy.
In the 1980s, markets were deregulate, unions were shattered, and the financial sector became a crown jewel of the British economy under the leadership of Prime Minister Margaret Thatcher.
The introduction of neoliberalism by Margaret Thatcher had many difficult knock-on effects, but from the 1990s to the 2000s, the British economy soared, led by London’s financial boom.
By the 21st century, Britain, which became wealthy as the world’s factory in the 19th, had become the world’s banker.
When the global financial crisis occurred in 2008, it struck with devastating force, derailing the United Kingdom’s economic climb.
“Between 2003 and 2018, the number of automatic-roller car washes (that is, robots washing your car) decreased by 50 percent, while the number of hand car washes (that is, men with buckets) increased by 50 percent,” Duncan Weldon, an economist commentator, said in an interview for my podcast, Plain English.
It appears that humans are taking the work of robots.
Obviously, the British economy is more sophisticated than men washing their cars with soap, so this example may appear peculiar.
Nonetheless, this is an exemplary instance.
According to the International Federation of Robotics, the United Kingdom has less technological automation in its manufacturing sector than nearly every other similarly wealthy nation.
In 2020, its average robot density was lower than that of Slovenia and Slovakia, with fewer than 100 robots per 10,000 manufacturing workers.
One investigation of the infamous “productivity puzzle” in the United Kingdom determined that, outside of London and the finance industry, nearly every British sector has poorer productivity than its Western European counterparts.
Currently, Britain appears to be caught between a left-wing antipathy to expansion and a right-wing hostility to openness.
On the intellectual left in the United Kingdom, a growing movement known as degrowtherism believes that in order to save the world, wealthy nations must stop chasing growth.
On the right, older people who care more about cultural wars than about competition control the electorate.
Weldon told me that when Boris Johnson and the Conservative Party secured a large majority in the House of Commons in 2019, the majority of individuals of working age did not vote for them.
“I believe that is the first time that has ever occurred.
You have this post-economic, older, economically insulated voting cohort that can afford to be anti-growth almost as a luxury because they have no vested interest in economic outcomes.
The United Kingdom is now a case study for other nations struggling with the dark trifecta of deindustrialization, degrowth, and foreigner denigration.
As a result of offshoring industries in favour of finance, its economy was fragile.
The consequent decline in living standards left the populace searching for a scapegoat.
The blame-seeking conservatives identified foreign bogeymen.
Brexit halted economic expansion and set the setting for a rolling political circus.
iliasro
Was born on the Bajora planet is the ninth planet after the sun it will take 8 light years to reach my planet which means you never going to make it with today's technology. I moved to earth due to ecological problems on my planet. Thought earth will be a better place but to my surprise, it is not. The stupidity those people have is unbelievable and that inspire me to write a couple of books on humanity and their stupidity. After years of travelling around the planet, I decided to live in this town which is across the sea from the mainland. Here the level of stupidity is higher and that is good because I sell more books
