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London — Plans UK A high-wage, high-growth economy is collapsing and workers' insecurity is growing as the Conservative Prime Minister struggles to cope with a cost-of-living crisis. In December 1973, the Finance Minister personally warned the government of Edward Heath that the country was facing its greatest economic crisis since World War II, according to classified records.
These papers shed light on debates at the heart of government during crises similar to those facing the current Prime Minister Boris Johnson's cabinet.
Like almost 50 years ago, the UK is now facing double-digit inflation driven by skyrocketing energy costs, pushing the most vulnerable households into financial hardship. I am letting you.
Unlike then, Johnson is in an interim position after being ousted from power in a series of scandals.
In either case, there are few good options, and media coverage of the current government's private 'worst case' planning documents has led to a return to the energy rationing that marked Heath's term.
Reuters footage from December 1973 shows an employee clutching a camping gas lamp in a dark store on London's main shopping street, lighting the way for customers. showing the situation.
Political analyst Peter Kellner, a Sunday Times journalist in the early 1970s, said, "It was a pretty dark situation, but we found a way to deal with it." .
While the UK is unlikely to face such a prolonged blackout, what threatens the world of contactless payment systems and computerized cash registers is repeated social and economic shocks. It will increase fears about Britain's ability to endure.
``There is a potential double parallel between Britain today and his 1973 Britain,'' Kellner said, noting the domestic factors that pushed up inflation in both periods. You mentioned a combination of global factors.
Historian Alwyn Turner agreed that there are similarities, but there are also significant differences, such as the backgrounds of top politicians.
Heath and His Labor opponent, Harold Wilson, shaped by the war and mass unemployment - gave them a historical perspective on the crisis even as they battled new threats to the UK economy.
"I think the problem now is ignorance. No politician remembers what inflation was like - certainly not in office. Britain's next prime minister is He is in his 40s.
Johnson has overseen billions of pounds of aid to help with soaring energy prices, but even as prices continue to rise, future action is likely He says his successor, who is to be named on September 5, is up to decide.
Consumer price inflation peaked at 24.5 percent in 1975 and
The Bank of England expects inflation to exceed 13% this October. , which would be the highest in 42 years, and had said in early August that it would take about two years for inflation to approach its 2% target.
He said the decline in living standards in China dates back to the 1970s.
"It's kind of a grind, and at some point people lose their patience," he said.
The European problem represents another difference from the mid-1970s. Whereas Heath pinned his hopes of economic recovery on joining the European Economic Community, Johnson's main policy was to leave his successor, the European Union.
Brexit has yet to deliver the promised boost in trade and investment, and deviations from EU rules are just beginning in many areas, according to official data.
Extreme Proposal
A December 1973 paper suggested that the intensification of the energy crisis caused by the Organization of the Arab Petroleum Exporting Countries' declaration of an oil embargo would , showing how it was coerced by the Heath government. Consider some extreme suggestions.
One was to limit the use of electric heating in all homes, he said, to one room, which then-Speaker of the House Jim Prior said was "harsh and practical." There is no coercion," he said.
By early 1974, the shutdown of miners forced a three-day work week across the economy.
Cabinet documents show that Heath cheated on the families of the striking men by depriving them of national interests. It was a "powerful weapon" but was dismissed as "highly questionable."
At the event, Heath announced a drastic cut in public sector investment, but his The government did not last long enough to complete its plans.
Heath, like Johnson today, was eager to shift the British economy into a higher gear.
In 1972, his government announced a budget that he doubled the rate of economic growth, which caused inflation. Today's frontrunner for leadership, Foreign Secretary Liz Truss, 47, has been accused by his rival candidate Rishi Sunak, 42, of making similar mistakes in pledging tax cuts.
"Potentially, Liz Truss' approach to growth... could also unleash the power of inflation," Kellner said. Truss said the plan would not promote inflation, and that it would be better to cut taxes rather than increase them and return them as profits.
While Truss promised a brighter future and dismissed economic warnings as 'decline talk', the Bank of England warned of a prolonged recession this month.
Snack has called for tax cuts only if inflation is brought under control, promising to spend more to fulfill its "moral responsibility" to help suffering citizens.
In the end, Heath paid for his economic and industrial relations treatment.
After announcing a snap general election in February 1974, Heath was narrowly defeated by the opposition Labor Party. Truss or Snack are expected to face voters in 2024, with polls showing the Conservatives trailing Labor.
(edited by Kate Holton and Allison Williams)
