Latest news with #economic stagnation
South China Morning Post
6 days ago
- Business
- South China Morning Post
Starmer's statesmanship abroad no substitute for vision at home in Britain
Prime Minister Keir Starmer's Britain is a nation in slow drift, outwardly composed but inwardly unravelling. His resolute backing of Ukraine and vocal commitment to European security have restored a measure of Britain's standing on the world stage. Advertisement However, this diplomatic poise conceals a glaring domestic void. Behind the polished speeches and choreographed handshakes lies a country buckling under stagnation. Its economic pulse is weakening, its public services are fraying and its faith in Westminster is eroding by the day. Not long ago, Brexiteers promised prosperity and a golden future , but for millions of Britons the reality is rising poverty and shrinking opportunity. More than 14 million people in the UK, including more than 4 million children, were living in poverty in 2022-23 – that is 1 in 5 people in the country. Britain's economy contracted unexpectedly for a second consecutive month in May, while inflation stood at 3.4 per cent that month – up from 2 per cent a year ago and high enough to keep food prices elevated and energy bills burdensome. Household budgets were already strained by years of austerity and Brexit-induced economic dislocation , and now they are stretched to the breaking point. The cost of simply getting by has become an impossible luxury for many. Youth unemployment reveals the crisis in even starker terms. According to the Office for National Statistics, 14.3 per cent of under-25s were out of work and actively seeking employment, more than double Germany's youth unemployment rate of 6.6 per cent. Add rising crime rates and the public's disapproval of the Labour government skyrocketing, and one finds a recipe for democratic disaster. Advertisement
The Guardian
14-07-2025
- Politics
- The Guardian
The right wants us to think Britain is on the verge of ethnic conflict. The truth is worse than that
June 2025 was a now typical month for the British press. It began when, on Tuesday 3 June, the Telegraph's Sam Ashworth-Hayes and Charles Hymas worried that white Britons, according to new data published by Matt Goodwin and trailed earlier that day in his column in the Daily Mail, will 'become a minority in the UK population within the next 40 years'. There followed a brief calm, interrupted only by the odd article informing us that 'London's decline is now irreversible', or that 'Starmer and Farage have doomed Britain to an endless spiral of decline'. By Friday 13 June, however, things reached a new pitch. That day, former Tory MP Douglas Carswell used his Telegraph column to complain that 'low-skilled, non-western immigrants' are a 'burden' on the country. We need, he wrote, 'a detailed plan to take foreign nationals off the benefit system and remove them from the country'. A day later, the Sun followed up with a report noting that the 'majority of Brits say UK 'is in decline' and fear civil unrest'. Later, the Telegraph warned the nation of a coming 'revolution', one born from the effects of immigration, state failure and economic stagnation. Here, in full flow, was a new chorus of 'declinism', the fear that the country's relative global decline is the result of the pathological failings of the British state and society. This is not, of course, the first time that declinism has lodged itself in the national consciousness. As historians such as Jim Tomlinson and David Edgerton have noted, it is a recurring feature of British politics, a near ever-present national neurosis in which failure in the present is traced to some corruption in the past. During the last great declinist wave, in the 1970s and early 1980s, Britain's failing industry was blamed on a pincer movement of overmighty unions and a state dominated by an inept upper class who ruled over more qualified recruits. For Margaret Thatcher and her acolytes, these where the 'enemy within'. There has often been a racialised element to declinism. In the late 1970s, the cultural theorist Stuart Hall and his co-authors saw the racial panic around 'mugging' as one aspect of the declinist narrative that led to the later dominance of Thatcherism. Thatcher herself, in 1978, famously spoke of the fear that 'that this country might be swamped by people with a different culture'. What seems new this time is the degree to which the two are fused. The problem for today's declinists is not so much Britain's stagnant economy and eviscerated state but the country's racial demographics, of which economic decline and political crisis are merely symptoms. On 19 June, for example, the Tory peer David Frost warned that under the twin evils of immigration and 'aggressive wokeism', Britain had undergone an 'unprecedented break in national continuity' – gone was the 'Britain of Christianity and the church', of the Romans and the Tudors, Churchill and the all-conquering Victorians, replaced by the ugly online neologism, 'the Yookay'. A day later, David Goodhart, writing in the Evening Standard, pondered the fate of the capital 'when London's white British population falls below 20 per cent in 10 years time'. 'Is there some minimum number of natives that a capital requires before it ceases to be the capital?' he asks, after quoting dubious statistics on the national costs of social housing first published on an obscure, anonymous rightwing blog. Come the end of the month, things had reached such a pitch of wailing hysteria and moral panic that it was difficult to discern fact from wild-eyed projection. The cover story in the summer edition of the Critic, for instance, warned of a soon-to-be-realised Britain of gated compounds and armoured trucks protecting British citizens from ethnic guerrilla conflict, thick with lurid depictions 'of gunfire, off in the distance; you're getting used to it now'. 'Fiction, perhaps,' wrote its author, a Conservative councillor for bucolic Scotton and Lower Wensleydale. 'But for how long?' Much of this can be explained as a form of circular reasoning. The same sources are endlessly recycled, with Goodwin's predictions of demographic collapse and various rightwing memes quoted and requoted in each succeeding piece, in turn justifying the next ratcheting up of racialised panic. Conversely, it is hard to deny that Britain is experiencing something like decline: productivity is stagnant, as are wages for the majority of people; inequality runs rampant, with the country looking increasingly like post-crash Greece without the climate; while faith in the political system and in our politicians and ruling elite reaches record lows. This is a febrile mix, although one only heightened by predictions of state collapse and race war. What we're now witnessing in the rightwing press is the real-time creation of a new political myth. By calling forth the nightmare of state collapse under the ever-increasing pressure of ethnic conflict and white replacement, the right has managed to cast itself as saviours. The nightmare serves as both a rallying cry and a legitimation: a call to a middle-class base which is feeling the pain of a stagnant economy, that those at fault are the racialised outsiders who bring disorder and drain the state of its already squeezed resources; and a justification for the tough actions needed to stem the tide of immigrants from across the border. No mention is made of the policies that might actually help to stem the sense of economic decline that many British people feel, such as wealth redistribution. Nor do today's declinists have anything to say about the role that austerity played in dismantling the state. In this sense, blaming decline on racial demographics is an opportunity to avoid changes that would be anathema to the right. As Labour increasingly apes Conservative rhetoric about fiscal rectitude, tanking ever further in opinion polls as it tails the right, space is opening for a new narrative in British politics. It doesn't matter that the predictions about a racialised apocalypse may never come true, since conjuring these fears opens up new political possibilities. If inter-ethnic conflict is the symptom of decline, then hardened borders and mass deportations can be offered as the solution. This, not ethnic conflict, should be our greatest fear. John Merrick is the deputy editor of the Break–Down
Arab News
13-07-2025
- Business
- Arab News
UK's steady, silent decline a worrying echo of the 1970s
In July 2025, the question of whether the UK is in decline no longer feels rhetorical in nature, it feels like resigned recognition of the fact. One year into Prime Minister Keir Starmer's Labour government, the chaos and dysfunction of the Johnson-Truss era of Conservative rule have faded. But so too has momentum. A brittle, overstretched economic model, persistent underinvestment and political caution have combined to leave the country in a state of quiet regression. Britain in 2025 bears an uncomfortable resemblance to that of the 1970s, not in terms of the headlines but in the undercurrents. Back then, the UK faced a decade of stagflation, industrial unrest, a weakening global role and rising domestic disillusionment. The country suffered a brain drain, watched investors flee and relied on an International Monetary Fund bailout to steady its finances. By 1979, it had become, in the words of many commentators, 'the sick man of Europe.' Fast forward to 2025 and economic growth once again remains stagnant, with gross domestic product expected to rise by a mere 1.2 percent. While the IMF is not directly involved this time, the UK's fiscal landscape nevertheless appears increasingly precarious. National debt has soared to 105 percent of GDP, taxes are set to climb further and rising interest costs threaten to outstrip growth over the next five years. Inflation has subsided, yet public services continue to face significant strains. The Labour Party has managed to stabilize political tensions but failed to inspire confidence in its ability to achieve long-term revitalization. Taxation levels have reached historic postwar highs, with threshold freezes subtly shifting middle earners into higher tax brackets. Much like during the 1970s, the middle class feels excessively taxed, inadequately rewarded and uncertain about the future. And so, the similarities between the two eras deepen. In the late 1970s, the middle class, once the engine of postwar prosperity, similarly found itself squeezed between rising prices and falling state performance. Half a century later, the same group is once again under siege. Wages are stagnant in real terms, mortgage payments have surged, rising energy bills are biting deeper into family budgets, and private education and childcare have become luxuries. Homeownership, a once-solid symbol of middle-class stability, is increasingly out of reach. Professional families now live precariously on credit, vulnerable to shocks and increasingly disillusioned with the political class. The outcome of all this? A demographic shift reminiscent of the brain drain witnessed in the 1970s. This decline, driven mainly by reduced work opportunities and study visa allocations, underscores a troubling issue: the UK is losing its upward potential while experiencing a contraction of its talent pool. London, once a magnet for international capital, entrepreneurs and academics, is now seeing its allure dim. Paris, Frankfurt and even Amsterdam are claiming gains in finance and tech. The City of London remains resilient but its future feels encumbered by Brexit, bureaucracy and uncertainty. An exodus from the London Stock Exchange marks a pivotal moment for the UK's financial sector, the Confederation of British Industry has warned. Since 2016, 213 firms have delisted amid a wave of overseas listings, private takeovers and waning investor interest in UK stocks. Since Brexit, exports of UK goods have lagged behind its G7 peers, investment has slowed and regulatory divergence has raised costs, cumulatively undermining business confidence, cross-border trade and the UK's global competitiveness. Meanwhile, both middle-class professionals and high-net-worth individuals have increasingly relocated to Canada, Australia, the UAE, Singapore and the US, driven in part by tax pressures and the erosion of the UK's 'non-dom' regime. It is a quiet exodus reminiscent of the 1970s. Back then, disillusionment sparked radical realignment and Thatcherism eventually swept away the postwar consensus in favor of market liberalism. In 2025, the response is more muted. The Reform UK party is rising on the political right, while Labour governs by managerialism. The country has chosen order over ambition. But stability, on its own, is not prosperity. Even Britain's foreign policy posture echoes the previous decades. The country is active on the war in Ukraine, committed to NATO and respected diplomatically. But its economic weight no longer matches its strategic vocabulary. As in the 1970s, the UK of today retains influence through alliances, not autonomy. London, once a magnet for international capital, entrepreneurs and academics, is now seeing its allure dim. Dr. John Sfakianakis There are differences between the eras, too, of course. Britain in 2025 is more diverse, more peaceful and less industrial than it was in the 1970s. The labor market is more flexible, inflation is less volatile. But the psychological parallels are stark. Now, as then, there exists a pervasive sense that the country is falling behind, that its best days might be behind it and that no political force has yet made a convincing case for how to reverse the slide. Driven more by ideology than evidence, the UK, unlike Germany or Canada, is now one of the few countries to impose a 20 percent value-added tax on private education, a policy that risks placing strain on the state sector without meaningfully reducing inequality. What is striking is not the urgency of the decline, it is its normalization. As it did in the late 1970s, Britain is adjusting to lowered expectations; it still functions but it no longer aspires. And while it continues to avoid collapse, it increasingly tolerates stagnation and mediocrity. The lesson of the 1970s was not just about endurance, it was about transformation. That decade ended with a revolution in Britain's political economy, one that reshaped its state, markets and global role for a generation. In 2025, the question is not whether the UK can survive its decline, it is whether the nation can find the courage to confront it. Britain today has the institutions, human capital and democratic depth to recover. But that recovery will not come from managerial politics or minimal policy. It will require imagination and the willingness to once again ask what kind of country it wants to be. Decline, when it is met with denial, becomes destiny. Acknowledged, it can become a moment of aspiration. That was the lesson of the 1970s. It remains the lesson today. To reverse this present course, Britain will need more than competent administration; it must abandon its reliance on short-term fiscal management and embrace a long-term economic and institutional strategy grounded in investment, productivity and social cohesion. To revitalize the nation, the development of a fresh growth strategy, one that recognizes the difference between stable GDP figures and actual economic vitality, is critical. The stock market alone does not represent the health of the economy. Secondly, comprehensive reform of the tax system is overdue. Threshold freezes and stealth increases have disproportionately hurt the middle and aspiring classes, while failing to restore fiscal strength. Thirdly, the state must regain its strategic capability, not in the form of centralized bureaucracy but in institutional capacity. Fourthly, a radical approach to human capital is essential. From early childhood to lifelong learning, Britain's skills development system is fragmented and underfunded. Finally, a national narrative is needed. For too long, the UK's political class has offered the rhetoric of survival and slogans of heritage, rather than a persuasive account of the future. Britain's institutions remain intact. Its rule of law remains strong. Its people are creative, tolerant and adaptive. But these strengths must be mobilized, through ideas, investment and leadership that transcend the default settings of recent decades. It was once said that Britain 'muddles through' — but muddling has become a strategy, and it is one that can no longer cope with the demands of a complex and shifting world. The 1970s did not mark the end of the UK, they were a turning point. What followed was a redefinition of the state, the market and Britain's place in the world. In 2025, another pivot is required. As Shakespeare warned, the fault lies not in fate but in our own hands. The UK's decline is not preordained, but the result of strategic drift and political timidity.
