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The Effects of Conservative Fiscal Policy [1]

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Date: 2025-01-25

How to Ruin an Economy

A new, ultra-conservative administration has just ascended to power here in the US. With a looming trade war, mass deportations, excessive deregulation in the financial sector, and many other economic blunders our Felon-in-Chief is sure to make, there are a great many Americans who are a bit concerned about the future.

For a good look at what right-wing fiscal policy can do to a nation, we need only look to our cousins across the pond in Great Britain. For years leading up to Britain leaving the EU, the far-right had been yelling about the horrible deal they had with the thieving Europeans, the dangers of immigrants ruining the country, the decline of traditional British values, etc… Sound familiar?

Now, here comes Trump and his merry band of fuck-wits. They came to power in much the same way as the Conservatives in Britain. “The horrible immigrants are ruining the country and eating our pets”. “Our three largest trade partners, China, Canada, and Mexico are screwing us over”. “The economy is so bad we can’t even afford eggs”. And, of course, Trump’s favorite line, “I’m going to solve all of America’s problems and make the rest of the world pay for it”.

A Brief History of Brexit

Image by Pete Linforth from Pixabay

The United Kingdom’s decision to leave the European Union, widely known as Brexit, was a momentous political and economic event. The journey began in 2013, when then-Prime Minister David Cameron promised a referendum on the UK’s EU membership if his Conservative Party won the next general election.

That’s when the far-right sprang into action. With the familiar weapons of innuendo, hyperbole, and outright lies, they were able to convince the British electorate that the only way to restore pride and economic well being to Great Britain was to leave the EU. So, it was no suprise that, in 2016, 51.9% of voters opted to leave the EU in a nationwide referendum, with 48.1% voting to remain.

The results of the vote revealed a deeply divided nation. While England and Wales predominantly opted to leave, Scotland and Northern Ireland favored remaining in the EU. The outcome prompted Cameron’s resignation and marked the beginning of a turbulent period in British politics.

Theresa May, who succeeded Cameron as Prime Minister, faced significant challenges in negotiating an exit deal acceptable to both the EU and the UK Parliament. The second female Prime Minister in British history, May failed to come up with a plan that would appease her own Tory party and her Labour opposition. After three failed attempts to get a deal through, she resigned.

One of the main reasons May’s plans fell apart was the opposition of Boris Johnson, who succeded May as Prime Minister. Johnson was eventually able to “get Brexit done”, chiefly by emplying his usual tactics of empty promises and mis-leading the public. This led to the UK’s formal departure from the EU on January 31, 2020.

The Economic Impact of Brexit

Image by Pete Linforth from Pixabay

Trade and Investment

One of the most immediate economic consequences of Brexit has been its impact on trade. The UK’s withdrawal from the EU’s single market and customs union introduced new trade barriers, such as tariffs and customs checks, disrupting long-established supply chains. Many businesses, particularly small and medium-sized enterprises (SMEs), have struggled with increased administrative costs and delays at borders.

Foreign direct investment (FDI) has also taken a hit. The uncertainty surrounding Brexit led to a decline in FDI flows into the UK, as many multinational companies reconsidered their operations in Britain. Some firms relocated their headquarters or shifted operations to EU member states to maintain access to the single market.

Labor Market

Brexit has significantly affected the UK’s labor market, particularly industries reliant on migrant workers. The end of free movement between the UK and the EU has resulted in labor shortages in sectors such as agriculture, healthcare, and hospitality. These shortages have driven up wages in some cases and have also caused operational challenges for many businesses.

Financial Services

The financial services sector, a cornerstone of the UK economy, has faced challenges in maintaining its dominance post-Brexit. While the UK and the EU agreed on a memorandum of understanding for financial regulation, the loss of "passporting" rights—which allowed UK-based firms to operate freely across the EU—has prompted some institutions to move operations to cities like Paris, Frankfurt, and Dublin.

Regional Disparities

The economic impact of Brexit has not been evenly distributed across the UK. Regions heavily dependent on manufacturing and agriculture have been hit particularly hard, while London, with its diversified economy, has been relatively resilient. However, the long-term effects on the capital’s financial sector remain a concern.

Current Economic Landscape

Image by Photo Stoo from Pixabay

As of 2025, the UK’s economy continues to grapple with the aftershocks of Brexit. Trade volumes with the EU have not returned to pre-Brexit levels, and the country’s growth rate lags behind other major economies. Inflation, partly driven by supply chain disruptions, remains a pressing issue, while the British Pound continues to fall against the Dollar.

Labor shortages, high inflation rates, public debt that is out-of-control and several other factors means that Great Britain no longer out-performs the rest of the G7, as had been the case in the years leading up to Brexit.

The current government’s effort to repair the 22 billion pound “black hole” left by the Tories have been greatly hamperd by the world-wide turn in Bond yields. This makes borrowing the money they need to get the British economy moving in the right direction gets more expesive every day.

Conclusion

The current situation in the United States closely resembles the situation Great Britain faced in the early part of the new century. Greedy, selfish men manipulating the media to force a false narrative on the voting public.

Using a playbook straight from Nazi Germany in the 1930’s, Donald Trump and his Broligarchs have managed to convince the American voters that the economy was in shambles (it wasn’t), that immigrants are responsible for everything wrong in America; from low wages to high crime. Only Trump and his merry band of fuck-wits can save us.

If you want to see what they’re economic plans for America will lead, just look across the pond.

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