Not So Great Anymore: Britain is Mired in Hard Times

Two centuries ago the British Empire ruled the seas and one-fourth of planet Earth’s population and terra firma. Now a much-diminished United Kingdom is the laggard in powerful blocs it once dominated, overtaken this year in its ranking as the world’s fifth-largest economy by its impoverished former colony India.

Britain’s slide from global prominence has been a centuries-long development as colonization and trade monopolies fell to independence movements and more recently to the rising clout of the United States, China and the European Union. Already a shrunken remnant of its imperial glory by the start of this century, Britain’s decline has accelerated over the past decade.

A self-inflicted wound called Brexit, compounded by the global economic body blows of the COVID-19 pandemic and Russia’s invasion of Ukraine, has laid low a mighty power. Britain today suffers shortages of hospital and emergency medical personnel, striking teachers, truckers, nurses and rail workers, and a bleak outlook for finding essential workers or raising wages.

While Britain still ranks as the world’s #6 economy, its forecast for economic expansion is overshadowed by the Eastern European countries whose migrant workers flocked to Britain after the collapse of communism three decades ago. Forecasts for growth and productivity, according to the Organization for Economic Cooperation and Development, predict a slow crawl back up the prosperity chain for Britons. Their outlook for recovery drops them below Poland and some Baltic and Balkan populations whose migrants were driven back to their homelands after the close and now-regretted 2016 vote to withdraw from the European Union.

Polish, Romanian and Slavic immigrants arriving to the United Kingdom during its EU membership piqued Britons’ ire over the bloc’s open borders for foreign laborers — much like Americans gripe unreasonably about Mexicans “stealing” blue-color jobs for which there are few domestic takers. The post-Brexit departure of healthcare workers, home caregivers, truck drivers, agricultural laborers and a host of other low-wage jobs now has British employers scrambling to fill vacancies undermining the health and security of the UK’s 67 million people.

Dismal growth and productivity statistics don’t come close to illuminating the human hurt inflicted by Brexit and its impact on trade and labor. The National Health Service suffers a crisis of care, from highly compensated family medicine general practitioners to the laborers who push wheelchairs and mop hospital floors.

Britain’s Royal College of Emergency Medicine estimates that delays in treatment of emergency room and ambulance patients is responsible for as many as 500 additional deaths per week.

A survey ordered by the government and conducted by the Ipsos-Mari pollsters in December found that 64% of those questioned expressed fears that if they suffered an accident or injury they would not be able to get treatment at emergency clinics or from ambulance crews experiencing waits as long as 12 hours before being triaged.

System-wide staffing shortages at NHS facilities have plunged the medical network into crisis, with harried nurses and overwhelmed family practice doctors unable to cope with swelling patient loads.

On the home front, family budgets have been hit hard by the disparity between sky-high inflation of 9.2% last year and record-low growth. Britain’s economy continues to shrink two full years after the Brexit vote was supposed to be fully implemented and the volume of trade restored with bilateral agreements with the country’s biggest EU-era trading partners. The UK economy has been on a rollercoaster ride since 2020, when GDP shrank by 11%, clawed back 7.5% in 2021 and finished 2022 with a meager improvement still far below its EU-member years.

London’s most damaging economic hit since exiting the EU has been to its trade with what is now a 27-member European bloc. The EU share fell from 54% of all British exports to 42% under the new trade pact, one of only four Britain has negotiated to replace accords scrapped with its departure from the bloc. Trade with the United States, which before Brexit accounted for nearly 17% of British exports, remains strangled by the failure to sign a new agreement, one that the Biden administration has said is still far off.

“Britain is in stagflation — with rocketing inflation, negative growth, falling productivity and business investment. Firms see potential growth opportunities but a lack of ‘reasons to believe’ in the face of headwinds causing them to pause investing in 2023,” Tony Danker, director general of the Confederation of British Industry, said in a statement in December.

Prospects look poor for an arrest of the economic and social tailspins that followed the 2016 vote of 52% in favor of Britain exiting the European Union. The split has hurt Britain far more than the remaining EU-member nations, with negative impacts on trade, labor and productivity in the two years since the divorce was final.

Persistent tensions arise between the UK and the EU over the Northern Ireland Protocol agreed after the Brexit vote but violated by former Prime Minister Boris Johnson. The avid Brexiteer driven out by scandal last July sought to renege on promises not to impose a hard Customs border between the British province and the Republic of Ireland, still an EU member. That undermining of an accord wanted by both sides of the Irish island has stirred fears of rekindling decades of violence known as “The Troubles” that was quelled by the 1998 Good Friday Agreement.

The UK is expected this year to post the lowest growth and the longest recession of the Group of Seven highly industrialized nations. Of the G20 states, only Russia is forecast to see a bigger drop in economic growth than Britain. 

Political turmoil around the 2016 Brexit vote has accelerated the economic decline and social discord. Conservative Prime Minister David Cameron advocated for staying in the EU, forcing his resignation as government and member of parliament after losing to the slim majority voting to leave.

Cameron’s Tory successor Theresa May served three years dominated by contentious parliamentary wrangling over how to withdraw from the EU. She pushed through commitments to environmental protection, record job creation and income tax cuts and sanctioned Russian diplomats and business figures after the poisoning of a Russian exile and his daughter. She resigned in 2019 after failure to get the Brexit withdrawal program passed by lawmakers.

Johnson, who followed May as head of government, tanked his leadership with headline-grabbing breaches of Covid lockdown protocols, partying at 10 Downing Street while Britons were forced to stay home. He was followed in the premiership by fellow Conservative Liz Truss, who lasted a mere six weeks before resigning for promoting tax cuts for big business and the wealthy while the nation staggered under skyrocketing inflation.

Prime Minister Rishi Sunak marks 100 days as prime minister this week with better marks than his recent predecessors but daunting challenges to buffer his country from the looming recession. Sunak has earned muted praise for halting the chaos of the Johnson era and the tumultuous rise and fall of Truss amid national mourning following the death of Queen Elizabeth II a day after anointing Truss as the new government leader.

Sunak has been tainted by a couple of scandals involving Cabinet members but appears to have escaped serious injury by focusing his problem-solver skills on the country’s cascade of crises, methodically addressing one challenge at a time. Striking rail workers obstructed the efficient movement of goods around the country in his first days in office and nurses protesting low pay and overwhelming caseloads compounded dangerous staffing shortages at UK hospitals.

On Sunday, the prime minister fired his Conservative Party’s leader Nadhim Zahawi after an ethics probe found he had been fined the equivalent of $5 million for tax evasion by His Majesty’s Revenue and Customs, the UK tax authority.

In a BBC analysis of Sunak’s tenure at so far, unnamed members of parliament were quoted as praising the prime minister for bringing some order to the chaos and sleaze that dominated Johnson’s three years as government leader.

“In 100 days, the prime minister has shown he is deeply serious. He’s demonstrated a deep contrast with his two predecessors. He’s shown he can choose priorities. And he’s brought the curtain down on what felt like years of circus,” the government-owned broadcast service observed. 

Even the most generous assessments of Sunak’s first months in office suggest little likelihood of a turnaround in Britain’s economic doldrums or recovery of its once-powerful influence in global affairs.

The Bank of England raised interest rates nine times in 2022 to combat inflation and further rate hikes are expected this year in an attempt to tame rising prices to a manageable 2% by late 2024.

Jeremy Hunt, Britain’s Chancellor of the Exchequer, laid out a plan on Friday to pull the country out of an economic crisis likely to get worse when a widely expected recession hits in the coming months. But he downplayed the country’s diminishment, calling it “a difficult patch” that Britons can overcome if they stick to his plan to cut the rate of inflation by half in the next two years. No tax cuts are in the offing, he said, citing the need to first contain inflation that is the biggest “tax” on Britons’ household budgets.

“Declinism about Britain is just wrong,” Hunt said, admonishing his countrymen for falling into despair about the combined hits to UK power, prestige and public services heaped on by the pandemic, a national health network in existential crisis, broken supply chains, falling trade revenue and the devastating impact on energy costs by Russia’s nearly yearlong war against Ukraine.

“Yes, we have not yet returned to pre-pandemic employment or output levels,” Hunt conceded. “But an economy that contracted 20% in a pandemic still has nearly the lowest unemployment for half a century.”

It is that dearth of available labor that promises to thwart recovery. The millions of workers from other EU countries who lost their work and residence permits after Brexit are finding more opportunities back in their homeland than in the island nation that has become a fortress.