wWhen Queen Elizabeth II took the throne, Britain was financially exhausted, rationing was still in place and inflation high after World War II. Then, as now, after her death on Thursday, concerns about the cost of living were at the fore.
Over the course of the second Elizabethan age, the country became more prosperous, healthier and socially liberal. The real gross domestic product per capita is nearly four times greater than his accession in February 1952, having started in the first two decades of his reign from a golden age of economic growth.
This unprecedented period of rising living standards, however, has not always been smooth and has not always been the same. For billions of people around the world there have been costs from the way Britain withdrew from the empire, coupled with profound changes at home, in 70 years of change up to the current difficult economic time.
In her seven decades at the throne the queen has seen five recessions and 15 prime ministers, with the toughest period for the economy coming in her later years with the 2008 financial crisis, the Covid-19 pandemic and the energy shock. during the war of Russia in Ukraine.
After the blistering heat of the tech revolution heralded by Harold Wilson in the 1960s, growth faded with the oil price shock, strikes and inflation of the 1970s. Inequality soared in the 1980s as central banks stifled inflation with soaring interest rates, while entire communities were hollowed out by the dismantling of industry.
At the beginning of the queen’s reign the economy was much more heavily oriented, with national champions, publicly owned industries and a welfare state in its nascent years. It was still a coal-based economy, reflected in the Great Smog of London in December 1952 within months of her reign.
Industrial employment – including construction, manufacturing, and utilities – was more than 40 percent when his father, George VI, died, but by the time of his sapphire jubilee in 2017 it dropped to a low of 15 percent. Britain has shipped more goods from overseas and produced less at home as globalization advances and the growth of the services sector thanks to the consumer credit boom and big bang reforms for the City of London.
In the early 1950s, however, poverty levels were low, at least in relative terms, in a period before most families had cars or color televisions. Only 13% of households were in relative poverty in 1953, the year of his coronation – defined as having an income 60% below the national average, before housing costs – and remained at that level for decades despite growth. stellar economy of the 60s. With the boom in the highest paid service sector jobs and welfare cuts in the 1980s, relative poverty has increased dramatically to 22% in 1990. It has declined since then but remains high.
While growing significantly healthier and wealthier, Britain lagged behind many of its economic rivals, says Jagjit Chadha, director of the National Institute of Economic and Social Research. “No new IMF or World Bank, for example, would offer the UK a seat at the first table, which was certainly the natural order in the first half of the 20th century.
“That the Queen was nevertheless able to maintain our monarchy’s international popularity at a time of imperial retreat and even strengthen the UK’s soft power is an enduring economic feat.”
Throughout history our politicians have looked back for lessons on charting a successful path for the economic future. However, it hasn’t always been helpful and may provide some unwanted answers for the politicians of the day.
When Margaret Thatcher came to power, leading economic historian Nick Crafts claims that he asked his advisors to evaluate the employment policies of his political hero, Winston Churchill. However, the findings were far from useful for Iron Lady, who found that the British wartime leader ran a pacification policy when it came to trade unions during the 1950s.
Unemployment during her second term, when the queen took the throne, was low, just under 2% of the working-age population; a figure unthinkable today, when an unemployment rate of just under 4% is considered a major victory in an otherwise difficult world.
Fearing an electoral disaster if unemployment escalates, Churchill prioritized cordial working relationships to keep it low. Thatcher was not impressed, Crafts says, “When they handed her the report, she apparently read it and said: wet, wet, wet! ‘”
Today the new prime minister, Liz Truss, appears with a similar mission to take Thatcherism’s greatest hits and reuse them for the present day. Yet there is only to what extent these lessons apply; coming as the changes of the past decades have reshaped the conditions for the road ahead.
Radical tax cuts, deregulation and the fight against unions are not a recipe for success today, at a time of broad public support for increased state spending on austerity-battered public services. In an age of zero-hour contracts and wages that can’t keep up with rising cost of living, few would like to see their labor rights ripped off or water down the regulations that ensure food and product safety. .
If there are lessons from postwar history to be taken, Truss could instead pay attention to the leading voice of British industry, the CBI lobby group, which called for a political response closer to that used by the Labor government of 1945, and the partnership. between government and business.
Truss vowed to “deliver, deliver, deliver” to reboot the British economy. Dropping the failed lessons of the past would be a good way to start and looking at different points of progress from the second Elizabethan age would help.
“We are not faced with post-war reconstruction, industrial decline, the need to deregulate or the need to tie our colors to the rise of the city,” says Chadha, underlining this point. “It is more a problem of how to unite the country and the devolved nations and aim for economic and social progress for all.”