British Health Service Politically Sensitive for Conservatives

For anyone who watched the opening ceremony of the 2012 Summer Olympics in London, the pride Britain takes in its National Health Service (NHS) is clear. Far from the apathy that most Americans feel toward government-provided services, the NHS has been a popular feature of British life since it emerged during the late 1940s as part of the Labour Party’s postwar government. That makes the debate about how to prepare the system for an expected rise in demand at a time of austerity politically sensitive.

The NHS is a public health provider that offers treatment “free at the point of use” and gets the majority of its operating income from taxes. But like health-care providers across the developed world, the organization is coping with strain as it balances Britain’s aging population against the country’s generally lower economic activity and rising health-care costs.

The Conservative Party-led coalition government has tried to improve the situation by privatizing an array of NHS services, creating a hybrid model in which most of the services that patients interact with are government-provided but many of the auxiliary services no longer are.

This has generally not been received well. The breakdowns in service provision directly attributable to this health-care delivery method have been documented in a number of recent studies. Polls show voters trust the opposition Labour Party more to improve the NHS than they do the Conservatives. This is not in itself new but alarming to Conservative Party strategists nonetheless. In response, George Osborne, the chancellor of the exchequer, announced a £2 billion funding increase for the NHS last week. Read more “British Health Service Politically Sensitive for Conservatives”

Failed Tennessee Volkswagen Unionization Reflects Wider Trend

The defeat of the United Auto Workers’ union at the Volkswagen factory in Chattanooga, Tennessee has sent tremors through the American industry. This turn of events is noteworthy in light of the fact that corporate management at Volkswagen was open to, and indeed supportive of, organized labor taking an active role in the plant.

The welcome reception the UAW received also meant that this was a perfect opportunity to make headway into the southern half of the United States where an increasing number of automobile plants are constructed to take advantage of lower labor costs and a cultural atmosphere historically hostile to trade unions. This hostility in the south is mirrored by a welcoming environment in the northern part of the United States.

Certainly the importance of labor unions in the twentieth century, in America as well as the rest of the industrialized world, cannot be overstated. Today, their principal value is found in creating a level playing field for labor in an economy increasingly dominated by capital ownership. Labor unions also provide a mechanism of communication and transparency between management and workers. Read more “Failed Tennessee Volkswagen Unionization Reflects Wider Trend”

Minimum Wage Increase Positions Osborne for Leadership

Britain’s coalition government has already had a remarkably busy new year on the economic front, with announcements about wholesale changes to the country’s financial map. The man largely at the center of all of this is Chancellor of the Exchequer George Osborne. Coming off a banner 2013 in which The Times named him “Briton of the year,” he has moved from topic to topic and done more to shape the look of his Conservative Party in recent months than even the prime minister, David Cameron. Among other things, he has proposed a £25 billion spending cut, given the European Union a stern talking to about reform and, most recently, promoted a minimum wage increase.

Osborne started January by warning that 2014 will be a “year of hard truths” and he promptly infuriated many of his Liberal Democrat coalition partners by proposing a £12 billion cut for housing benefits to Britons under the age of 25 and recipients otherwise too wealthy to receive government subsidies.

While cutting housing benefits is not a bad idea in and of itself, it fails to address the largest component of government welfare spending — pensions. Indeed, pensioners receive 50 percent of the country’s entire welfare budget but have been declared off limits for spending cuts.

Osborne’s plan also takes a narrow view of opportunities for budget cuts, failing to focus on the raft of government spending earmarked for other projects and programs, such as developmental aid — a fact pointed out by London’s Conservative Party mayor, Boris Johnson. Read more “Minimum Wage Increase Positions Osborne for Leadership”

Norway’s Election Winners Propose Relaxing Wealth Fund’s Spending

In an election that was a foregone conclusion even before the first ballot was cast, Norway’s right-wing coalition led by the Conservative Party’s Erna Solberg swept to power on Monday. Perhaps the most controversial story from the election was the rise of the Progressive Party, the Conservatives’ key political ally. It is noted both for its anti-immigration positions and for its association with mass murderer Anders Breivik, a former party member.

While this aspect of the election has caught international attention, the bigger issue for voters in Norway was oil. Specifically, what to do with $760 billion worth of oil generated wealth in a sovereign wealth fund awkwardly and inaccurately named the Government Pension Fund-Global. Read more “Norway’s Election Winners Propose Relaxing Wealth Fund’s Spending”

India’s New Bank Governor Expected to Advocate Structural Reforms

Named as one of Bloomberg Markets’ fifty most influential people in its upcoming October issue, Raghuram Rajan has been much more than a mere professor of economics over the course of the past decade. One part public intellectual, one part policymaker and perhaps the most famous Cassandra of the global financial crisis, he is widely considered to be among the world’s preeminent thinkers on economic matters. Yet few would envy Rajan today as he steps into the middle of his country’s growing financial maelstrom as governor of the Reserve Bank of India,

While nearly all emerging markets have suffered from capital flight in anticipation of the American Federal Reserve’s return to tighter monetary policy — including the winding down of its quantitative easing program — India has been especially hard hit. Its economy is suffering from multiple woes: a rupee diminishing in value every week and mired in inflation, uncontrolled budget deficits and subsidy programs and the world’s second largest current account deficit. Read more “India’s New Bank Governor Expected to Advocate Structural Reforms”

Euroskepticism, Scottish Nationalism Fuel English Discontent

By most measures it would seem the English have many reasons to celebrate. Their economy is finally clawing its way out of the gutter and the birth of the royal baby has continued a wave of positive attention and international goodwill that last summer’s Olympic Games and Diamond Jubilee engendered. Yet evidence indicates that, for the average English citizen at least, there is a growing dissatisfaction with the status quo — a fact that often gets lost in Britain’s dual political coverage of Whitehall schemes and Scottish secession plans.

Part of this sentiment can be traced to the debate about Scotland and its upcoming independence referendum. As Scotland’s citizens have begun to rethink what it means to be both British and Scottish, so have England’s. Evidence from the Institute for Public Policy Research shows (PDF) the English no more in favor of the union than those north of the border.

According to the institute’s most recent Future of England Survey, English citizens feel that the process of devolution has given unfair advantages to the other three countries of the United Kingdom — at England’s expense. The result of which is a ballooning level of parochialism. Today, twice as many people in England prioritize being English over being British. The rhetoric of the Scottish government and the Scottish National Party in particular, which is often aimed at driving a wedge between England and Scotland, must bear part of the responsibility. As they focus on what is unique about Scottish culture, they remind England what is unique about its culture too. However, England’s negative feelings do not end simply with Scotland. Read more “Euroskepticism, Scottish Nationalism Fuel English Discontent”