Usually when my regular workload intensifies I find it hard to get time to put meaningful content up on this blog. However, recently that has not been the case. Instead, my predictions from the past two years – and especially from my book Industrial Poverty – are now cashing in, yielding bundles and barrels of content material. What I have been saying since 2012 is now dawning on political leader after political leader in Europe, namely that the continent simply is not going to recover.
Yesterday, British Prime Minister David Cameron joined the chorus of alarmed, baffled, concerned and desperate European political leaders who, with rising anxiety in their voices, try to determine why their continent’s economy is going nowhere. Cameron got plenty of room in The Guardian:
Six years on from the financial crash that brought the world to its knees, red warning lights are once again flashing on the dashboard of the global economy.
For the zillionth time – it was not a financial crisis. There. I had to make that point again. Back to Prime Minister Cameron:
As I met world leaders at the G20 in Brisbane, the problems were plain to see. The eurozone is teetering on the brink of a possible third recession, with high unemployment, falling growth and the real risk of falling prices too. Emerging markets, which were the driver of growth in the early stages of the recovery, are now slowing down. … The British economy, by contrast, is growing. After the difficult decisions of recent years we are the fastest growing in the G7, with record numbers of new businesses, the largest ever annual fall in unemployment, and employment up 1.75 million in four years: more than in the rest of the EU put together.
Back in August I noted that the U.S. and U.K. economies were outgrowing the rest of Europe. We will soon have the definitive numbers for the third quarter, but until then we can basically take Cameron’s word for it that Britain is way ahead of the rest of Europe.
Cameron then turns to the dark clouds on the global economic horizon, pointing out that the economic stagnation in the euro zone is showing up in Britain’s foreign trade statistics. And then he makes an interesting observation:
As the global economy faces greater uncertainty, it is more important than ever that we send a clear message to the world that Britain is not going to waver on dealing with its debts. This stability is vital in attracting the business and international investment that delivers growth and jobs, and which keeps long-term interest rates low. So we will stick to our plan on the deficit and continue to use monetary policy to support growth without adding to borrowing or debt.
This sounds like a generic political statement, formulated to put out specific words in a specific order to appeal to the subconscious mind of the voter. But it is more than that: this is a poke in the side of Germany and other euro-zone countries who cannot get their economies going. Cameron’s point is, plainly, that Britain has been successful in separating its fiscal and monetary policies from the European mainstream – and that Britain will continue to pursue its own, independent economic policies.
No doubt, this is an attempt at appealing to UKIP supporters, but it is also an acknowledgment of a reality where the EU is stuck in the ditch of economic stagnation and Britain will not – and cannot – let itself be held back by that same organization.
In fact, as Cameron continues, he carves out an even sharper independent profile for himself and his country:
Our long-term plan is backing business by scrapping red tape, cutting taxes, building world-class skills and supporting exports to emerging markets. Underpinning all of this is our radical programme of investment in infrastructure. … We are making the biggest investment in roads since the 1970s and the biggest in rail since Victorian times, connecting 40,000 premises to superfast broadband every week, and starting an energy revolution with the first new nuclear plant in a generation, the world’s first green investment bank and the largest production of offshore wind on the planet.
We’ll see how that energy policy works in the end. American energy prices are falling, thanks in part to an expansion of oil and natural gas production on private land. But again – Cameron’s point is that Britain stands out among European countries, that the leading euro-zone economies are in permanent stagnation and that Britain is not going to fold into the ranks of European mediocrity.
David Cameron is not the best option for Britain. He is, fundamentally, a traditional British Europhile. But the fact that he talks so forcefully about the uniqueness of British economic policies and economic performance is a clear indication of which way Britain is heading, and why. His article simply confirms how strong the euroskeptics are in Britain and thereby the high probability that Nigel Farage of the UKIP will be their next Prime Minister.
Let us hope that Cameron continues with his moderately successful fiscal policies. If he can make an example out of Britain to the rest of Europe, he can embolden Euroskeptics elsewhere in the EU. Eventually, their strength – given that they are of the UKIP kind and not aggressive nationalists – will bring an end to the stifling statism that has become endemic in austerity-ridden eurozone welfare states.