Conservative government: What next?

 Conservative Government: What next?

Since the days of Boris Johnson and in spite of then then 80 seat majority, the Conservative Administration has been plagued by both issues that they could not possible foresee and control and by situations that arose because of measures they took that turned into yet another crisis.

The Covid Pandemic declared in March 2020 put everybody to the test and lockdown measures adopted to apparently tackle the pandemic generated a whole new series of issues, increasing divisions within the Conservative Government. It was about 'Lockdown or no Lockdown'. 

The start of declared hostilities in Ukraine was yet another test. Sanctions against the Russian Federation backfired and produced an energy crisis that destabilized the British Economy. The long standing stability with low prices and low interest rates gave way to higher interest rates and higher prices that in turn produced a series of strikes and forced the government to add more protection measures on top of the protective measures adopted during Lockdown to prevent a sudden rise in unemployment due to lack of economic activity.

Once the government started to regain control the crisis in Palestine opened a whole new can of worms. The fact that people immediately took sides reflects the tribal nature of Britain and this, unavoidably, led to yet another reshuffle to try and have some kind of equilibrium both in national terms and in terms of geopolitics.

All the way, from Covid, going through Lockdown, sanctions against the Russian Federation that led to rising inflation and the present issues involving Palestine, fractures within political parties became fairly visible. It is like walking on a high rope without a balancing pole. As the saying goes, 'keep your friends close and your foes even closer'. Loyalties are being tested to destruction. If Britain were to be involved in a real war tomorrow morning, this is a government that is struggling to survive until the next General Election due to take place in May 2024 and that will not be capable of dealing with war at home and war abroad. What would a General Election in 2024 achieve? For starters, it could be change, even if it is change for change sake. Having said that, when you look at what is happening across the home nations, political realities are much too complex to be able to foresee what the outcome of a General Election would be. 

North of the border, at times it looks like the SNP will collapse. At times it looks like any expectations about the demise of the SNP are very much an exaggeration. In Wales, the Labour administration might be unpopular, but then people might decide to stick to what they have got for fear of worse political realities. In Northern Ireland, political paralysis is a reality with Sinn Fein winning spaces and without a cross party agreement to return to the Northern Ireland Assembly. In England, the mainstream political parties are fragmented depending on what are the most important issues according to regions.

There are far too many issues that generate divisions both in terms of national politics and of international politics. You cannot promise one thing to please one side without alienating another side and you don't have the luxury of being vague in terms of where you stand politically.

UK: In just a few weeks, the British economy could be in the doldrums and much stronger leadership will be needed

 

What is happening right now is deeply worrying because the times of easy money could be coming to an abrupt end. The issue is not just rising inflation. The issue is that salaries and pensions have been pegged to inflationary pressures. 

At this point in time, asking for salary rises pegged to inflation could itself be a force towards more inflation and more borrowing when interest payments will be taking their toll on public finances.

And what if, as expected, the Treasury does not agree to salary increases that it could hardly afford? Would the state sector be ground to a halt? It is understandable that public workers that are seeing their incomes devalued are prone to ask for salary rises. Having said that, those in charge know full well that public finances have been drained and that any monies to pay for higher salaries will come from additional borrowing at a time when interest rates are going up and from an increase in taxation.

If energy is the main driver when it comes to inflationary pressures, then more energy will have to be produced and to do so all the promises in terms of a reduction of the use of fossil fuels will have be put aside. In the 1970s, Britain was almost brought down to its knees and the country was working just a few days a week. The issue was then energy or lack of it. Today, the issue is the price of it. Whoever takes the reins of power in September will have to make difficult choices. Doing less to save energy is not an option. Slowing down the British economy by enforcing energy savings will make matters a lot worse. 

We learnt from the imposed Covid lockdown leading to lack of economic activity that slowing down the British economy will cost livelihoods: businesses will be closed down and an undetermined number of jobs will be lost. Companies that generate little or no revenue at all have no reason to maintain jobs. Less economic activity endangers jobs and produces less tax revenues. If you slow down an aircraft in plain flight the time comes when the only way is down. We cannot have yet another loss of economic activity. We need energy and we need energy wherever we can find it. If foreign oil and gas producers don't want or cannot provide additional oil and gas, Britain will have to become self-sufficient and all options should be on the cards, including fracking.

Whoever is chosen as Prime Minister will have to make hard choices and implement decisions that will prove to be as unpopular as fundamentally necessary. Whether Rishi Sunak or Liz Truss is in command, he or she will have to forget about popularity contests. The popularity contest is only there to get one of them elected. Real governance demands dogged determination to do what is right.   

A futuristic picture of Europe?

 A futuristic picture of Europe?

As days become shorter and Europe moves towards the dark seasons of the year, after Covid lockdowns, come the Dark Ages. In Southern European regions, it would not be much of a problem, but the most affected regions of Europe will include highly industrialized areas. 

Manufacturing will be reduced, commercial activity will be reduced, and we will have to calculate the consequences that in some ways could be pretty similar to what Europe had to face because of the measures implemented to deal with the Covid pandemic. As inflation takes hold and energy prices go up, the lack of economic activity with add to the pile of debt - both public and private - destabilizing economies even more leading to what the Deputy President of the European Commission called 'social unrest'.

German cities impose cold showers and turn off lights. Rising production costs in the UK lead to 4.4% in UK shop prices. It is said that EU member states have very different energy mixes: a few countries were nerarly 100 per cent depedent on Russian gas while others used none, indicates an article published by The Guardian in London, UK. There is discontent in countries that used little or no Russian energy that are now forced to make sacrifices for those that spent many years using cheap gas imported from the Russian Federation.

In the meantime, the Rubble, the Russian Federation currency, is booming. Simon Jenkins states that sanctions against the Russian Federation have visibly backfired. Energy prices are rocketting, inflation is soaring and millions are being starved of grain. Having said that, for EU member states the worst is still to come. Keep an eye on Western economies. Keep an eye on political developments. As inflation rises, industrial unrest will grow and political stability will vanish.

July 19th 2021: time to go back to business as usual?

 

Since images like this were taken, London has moved on and movement in the capital city is almost normal in terms of people going about their business, public transport is getting busier as the number of vehicles on the streets has also been rising.

On July 19th 2021 the country is due to go back to normality without any major restrictions but the issue of Lockdown has been politicized so much that it will continue to be controversial with those who want a full opening and those who talk about caution.

The new Health Secretary Sajid Javid seems to be on the same wavelength with Chancellor of the Exchequer Rishi Sunak that is totally opposed to any more furlogh schemes as the level of expenditure is hurting the British Treasury after more than 12 months of over-spending to deal with the pandemic and the cost of measures implemented to keep the economy afloat.

Many marching on the streets of Britain have said that 'enough is enough'.

Having seen holes on British highstreets with renowned businesses that are no longer trading it is difficult to believe that normality will be back any time soon. We will also have to be creative when it comes to public transport and fares. Because of Lockdown several franchises had to be temporarily taken over and reduced passenger numbers have also affected branches of services run by the State. Whether this is a temporary setback or a more permanent state of affairs remains to be seen.

And what about shopping habits and working habits for all other businesses that depend of the numbers of people working in offices. Will they ever be able to return to business as usual or will they struggle to get customers back?

At this point in time, July 19th 2021 is still a promising re-start of activities for many and the government has committed itself to a full re-opening. We waited and waited for June 21st 2021 and just days before Lockdown measures were extended. There are almost two weeks to go before July 19th 2021. Could some similar happen once again?  

Covid-19: Barclays Bank forecasts the bigges economic boom in the UK since 1948

 

While may of us worry about the economic prospects during the pandemic and after the pandemic, Barclays Bank forecasts the biggest economic boom in the United Kingdom since 1948.

The news is extremly encouraging and helped by good weather and the will of the British people to finally come out of the Lockdown period to start spending and enjoying their newly found freedoms might well be the key for more spending, faster turnout of monies spent and an explosion of optimism to get us out of the doom and gloom period to start runnning towards higher rates of exployment and of consumer satisfaction.

This happens when our neibouring EU countries are still in a muddle in what concerns Lockdowns, vaccinations and the number of infections and life losses and adding to this the climate of instability that leads to street protests and confrontation as countries like Germany and France are heading towards General Elections. One can only wonder what will be the outcome of those elections and the political repercussions across the European Union.

Covid-19 and the pandemic are health issues that have quickly turned out to be highly charged political issues in terms of competence of authorities to deal with health crisis and the willingness of elected representatives to pass ever more restrictive and in some case more repressive legislation.

We await the new dates for greater opening of Britain and we await also the outcome of experiments of social mass gatherings to detect the effects concerning the spread of infection.

From Covid-19 to B117: This could be like the plague that killed 50% of the population of Europe

From Covid-19 to B117. 70 per cent more contagious and more than 30 per cent more deadly. We are flowered. More than 25 per cent of those who recover will die within five months because of the damage done by the virus to vital organs.

Since no country can exist under a permanent Lockdown, financial collapse will follow leading to riots and revolutions that will destroy any democratic form of government.

This is Das Ende. If you live in an area of the world where the pandemic is not an imminent danger coming to Developed World is the equivalent of committing suicide. Refugees and illegal imigrants are effectively migrating to die a most horrible death in the Developed World.

Britain is facing the dangers of a prolongued General Strike combined with financial meltdown

Britain is facing the dangers of a prolongued General Strike combined with financial meltdown

The end of the Lockdown will unleash the law of unintended consequences. For example, for education to go back to normal timetables, two conditions must be met. You need to have enough teachers willing to return to the classrooms and enough parents must be willing to send back their children to full-time education.

At the moment, none of the said conditions seem to be about to be met. Trade Unions have stated that they are reluctant to tell their members to go back to work in conditions deemed to be unsafe. Surveyed parents have indicated that they don't want their children back in school for fear of infection.

As long as the Lockdown goes, teachers' salaries continue to be paid. How long will teachers' salaries continue to be paid if the authorities decide that all schools must return to normal timetables and teachers don't show up? Will parents be forced to send their children to school? Will those who don't be penalised?

Normality in terms of school attendance has a direct impact on working families. Parents could not go back to work as normal if their children are not in full time education. In principle, the furlogh scheme will only last until October 31st 2020 when many - perhaps millions - will find out if they still have got a job. 

People without income cannot pay for mortages and loans. We could witness a massive Northern Rock effect. To the number of companies that have already gone under will be added the number of those who have gone under that we still don't know about.

This will happen at a time when the state is already involved in unpredented levels of borrowing to finance the furlogh scheme and other emergency funding. If as a direct result of the present predicament, the financial sector falters, there is no money in the kitty to rescue the financial sector and at the same time pay for mass unemployment.