The Economist: You've never had it so good: The State of Britain
COUNTRIES, just like people, have moods; and Britain's is somewhat grumpy right now. It is bored and disillusioned with politicians, not least with Tony Blair. It is unimpressed by public services, despite the public money Mr Blair has poured into them. It is cross about rising taxes and interest rates. It is concerned about social cohesion and frightened by its home-grown bombers. It is furious about the Iraq war and George Bush. And, to cap it all, its cricket team can't win anything.
Yet in a way it is odd that Britain's spirits should be low. The place is enjoying a period of extraordinary prosperity. Fourteen years of stable growth have kept unemployment down. There have been social gains as well as economic ones: fewer children and pensioners live in poverty than ten years ago. Crime is broadly lower. And with prosperity has come renewed political clout. Britain has helped to shape aid for Africa, the debate on climate change, European enlargement and, last week, negotiations to restart world trade talks.
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Perhaps because of its imperial and trading past, Britain is remarkably at ease with globalisation. While American politicians stoke anti-Chinese hysteria and French ones fuel worries about the disappearance of jobs to eastern Europe, British politicians keep off the subject. The last vestiges of Britain's home-owned car industry closed in the run-up to the last election in 2005, causing barely a ripple of protest.
But globalisation has social, as well as economic, consequences. The flow of foreigners into Britain has accelerated over the past ten years, partly because of demand (booming economies need new workers) and partly because of supply (developing-country disorder and new entrants into the European Union). Although this huge wave of immigration has done wonders for the economy, Britons have also found it socially troubling; and that's one of the reasons why the country is not entirely at ease with itself.
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Much of that might be achieved by improving the quality of education, the best way to lift people out of ghettos into the mainstream. It is also, by neat coincidence, the key to ensuring Britain's success against ever-tougher competition as globalisation rolls on. No solution is perfect. Open your window, and, yes, you are bound to admit a few flies; but the main lesson of recent British history is that fresh air is good for you.
Related: Britannia redux
The birthplace of globalisation in the 19th century is coping well with the latest round, writes Merril Stevenson. But can it keep it up?
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Now its fortunes are looking up again. Steady economic expansion for the past 14 years has pushed its GDP per head above that of France and Germany. Its jobless figures are the second-lowest in the European Union. Inflation has been modest, and sterling, the Achilles heel of governments from Clement Attlee's to John Major's, is if anything too strong for Britain's good.
Much of this transformation is due to a quarter-century of profound policy change at home. The Conservatives in government tamed the unions, freed financial markets and unloaded a host of state-owned enterprises. A wrenching decade resulted in a more flexible and competitive economy, though also a more unequal and less cohesive society. A Labour government under Tony Blair sensibly built on its predecessors' work but tried to combine free markets with social justice.
Yet globalisation too has played a big part in defining the Britain that is emerging now. Barriers to the free flow of goods and services, labour and capital are being pulled down around the world, aided by huge improvements in communications and transport. Most countries are embracing market capitalism, including titans in the developing world. It is not just their tennis shoes and computers that are conquering the globe but, increasingly, their software and services, and indeed their capital. Most important, perhaps, they have vast pools of relatively cheap and increasingly skilled workers who put pressure on jobs and wages in rich countries.
Allied with technology, globalisation increases competition and exposes inefficiency. It tends to lessen inequality among countries and increase it within them. In short, though the overall effect is positive, there are losers as well as winners.
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