United States and the United Kingdom

Barone on the Anglo-American Divergence

Ted R. Bromund - 07.21.2009 - 12:27 PM

Michael Barone has a column today at Real Clear Politics that’s summed up by its title: “Britain and United States Go In Different Directions.” His thesis is cogent, and to an extent correct: The Obama administration is trying to drag the U.S. to the Left (he might well have said that the administration is trying to Europeanize it), whereas in Britain, the next government looks likely to be Conservative and to be more interested in shrinking the state (or at least restraining its growth) than expanding it.

This divergence is limited only by the consideration that it’s not easy to change the direction of politics: Whatever the situation, no matter what the crisis, the status quo has inertia on its side.

Arguing with Michael Barone about U.S. politics is a losing proposition. But he does miss an important piece of the British context: Labour lost the 1992 general election, an election it arguably should have won. This marked the start of a divergence of U.S. and British political cycles that is unprecedented in the postwar era. The cycles do not line up precisely, of course, but consider Ike (1952) and Churchill (1951), or Wilson (1964) and Kennedy (1960), or Thatcher (1979) and Reagan (1980).

When John Major pulled it out in 1992, he set the Conservatives up for a pretty miserable five years in power — there may be an analogy to George W. Bush’s victory in 2000 lurking here — that saw the Tories crushed by the collapse of the pound in September 1992, a deep recession, and splits over Europe. If Labour had won in 1992, that would have been their inheritance, and they likely would have responded in the same way and suffered the same unpopularity. The narrow defeat of 1992 set them up for a crushing win in 1997.

That victory was premised on any number of arguments, but central to Labour’s win was their case that the mean old Tories had systemically underfunded Britain’s public services. After a few years of restraint, Labour took advantage of the strong economy they’d inherited from the Tories to start spending. As Barone notes, the result was that they drove the size of the British state up to close to 50 percent of the entire economy, without substantial improvements in public services, at precisely the moment when a global recession was hitting in Britain with particular severity and pushing government borrowing to over 14 percent of GDP over the year to come.

So it’s not that Britain and the U.S. are diverging. They did that 17 years ago. What we’re seeing today is the result of that divergence: If you spend the kind of money Labour has over the past 10 years, there will sooner or later be a reaction against it. It’s happening in Britain now, and it’s happened on the continent, which in the past few years has moderately clamped down on the state and is now not keen on growing it again to fight the recession.

Why? Because in the short run, voters like promises of benefits more than they resent taxes, but in the long run, when the benefits do not materialize and the costs of pursuing them become obvious, they change their minds.

Obama is trying to double-time his way through the Labour experience: Skip the few years of restraint and get to the massive spending increases as fast as possible. If Britain’s experience is any guide, that may be the best way to close the Anglo-American divergence in double-time as well.