No, it's not just a Rishisession, it's 40 years of chronic underinvestment where it's needed...

RANT...

The U.K.s' GDP shrank by 0.3% in the fourth quarter of 2023, following a fall of 0.1% in previous quarter.

That makes for two consecutive quarters of economic retraction, which is technically a recession.

While the Tories can argue that is just barely a recession, the economic prospects for the U.K. are looking pretty bleak.. GDP only grew 0.1% in the whole of 2023, and because of increasing population GDP per capita actually fell by 0.7%.

This is the longest decline since 1955.

The phrase 'Rishicession' has been bandied about on Twitter, but while this is a nice play on words (and one loves a good play on words) I think this is a little unfair, because Rishi's had nowhere else to go with his latest economic policies within the boundaries of narrow Tory economic policies which have failed to generate sufficient long-term investment into UK physical and social infrastructure...

Short term causes of the recession...

The Tories will always point to the short term causes of this recession - the rapid cause in the inflation caused by the double whammy of the Pandemic and then Russia's invasion of Ukraine impacting the cost of energy. This then required a ramp up of interest rates which hampers investment.

However, while such international factors will have had a detrimental effect on the UK economy, I think maybe our recession, measured in GDP terms don't forget, is down to chronic underinvestment over the last 40 years....

NB this investment could have come from a leftist tax and invest strategy or a rightist cut taxes and incentivise investment strategy, but the problem is we've had the later neoliberal policies for decades now, mutated by various forms of public private partnership, but they haven't encouraged investment, rather they've encouraged extraction.

British waterways are a great example of this...

I listened to a depressing Radio 4 programme a few days back in which industry experts estimated it would require around £30 bn of investment to bring Britain's water systems up the level where we'd have enough clean drinking water, get our sewage treated effectively AND clean rivers.

The same programme also pointed out that several billion pounds in profit, not that far off what it would take to sort out our water systems, have been given away in profits to British water company shareholders.

That's precisely the kind of investments that have been encouraged over the last 40 years.... Vesting keeps services running JUST ABOUT, profits get skimmed off, and the CAPITAL project deteriorates...

And more extractives....

The railways spring to mind as another example. And when we do have a new project in the form of HS2.... companies basically line up to take the piss by charging huge construction fees, seeing the UK as a cash cow...

And housing, we used to have social housing stock, sold off cheap, and now benefits pay out billions every year to a handful of landlords.

A rentier class and lack of production...

I'm sure we've now got a substantial rentier class who have benefitted from such profits, a relatively small 5-15% of the population, the loyal Tory hardcore. I've got to hand it to Thatcher that her policies were a masterpiece of creating loyalty.

This rentier class have largely vested their profits and just skim off them, probably Vested for the most part in clever financial instruments rather than Vesting in firms that actually produce things.

And we don't produce things anymore as a general rule, we rely on imports, which with the declining value of the pound since Brexit, cost more..

This hasn't been to long term advantage of the UK's infrastructure and I'm sure it's contributing to our steady decline: our lack of decent jobs, poor housing stock, creaking NHS and literal crumbling schools.

What we needed....

Was sustained investment where a higher proportion of profits got ploughed back in to out social infrastructure....!

No way back...?

It's going to be difficult to bring the UK back, we are unlikely to get higher taxes, the public don't want it, and we are unlikely in the context of the continuation of neoliberalism, to to see significant state or even private Vesting in social improvements, it is just not profitable!

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