Well, that’s what the five year old me used to say. And after that obsession fizzled out I triumphantly declared that I wanted be a pilot. Unfortunately the closest I ever got to that dream was tying the dog to the back of an aeroplane shaped climbing frame in the park and pretending to fly to some exotic and far flung destination. The realities of life soon set in.
At secondary school you could ask me the above question and I would not be able to give a meaningful answer. Infact, if you’d have asked me the same question at my university graduation I would have again have struggled to give a meaningful answer. It was only after a disastrous foray into a company which promised better things that my mind was sharpened enough to actually sit down and think about my future. And even now, I only have an aim. The effects of a bitter financial crisis, double-dip recession, austerity and the Leveson Inquiry could quite easily conspire to derail my future plans at any given time. After all, print journalism is a dying trade and thanks to News International journalists are only a couple of notches above bankers and Syrian President Bashar al-Assad in the global hate index.
Anyway, that is all beside the point. For many people their ambitions and dreams have been placed on ice since the 2008 financial crisis. A deep recession, low growth and biting austerity measures across the Western hemisphere have created a sickening cocktail which has plunged an entire generation into despair. Currently, over 1 million people in the United Kingdom under the age of 25 are unemployed. Countless more are still living at home and working dead-end jobs, biding their time and praying for that elusive opportunity to appear. However, does the shock election of Francois Hollande offer a glimmer of hope to the millions negatively affected by a crisis which was created in a distant land and paid for by their taxes?
At first glance, it does. Francois Hollande has explicitly stated that he is “the President of the youth of France.” Standing against European and Western austerity, Hollande has spoken passionately throughout his election campaign and promised to refocus EU financial efforts from austerity to growth. Although vague, current ‘radical’ policies of Hollande include the creation of 60 000 new education posts, a ‘squeeze on the rich’ and the implementation of a 75% tax rate for the super rich. When combined with the complete Greek rejection of austerity are the troika demands for deficit reduction, austerity and tax rises dead in the water? After all, it does pay for the currency sharing European nations to row in the same direction and strive to avoid the potential implosion of the Eurozone.
Unfortunately even with the election of Francois Hollande the policy of European wide austerity is far from dead. Constrained by the very same financial markets that created the economic crisis and with French public sector spending currently accounting for around 57% of GDP, Hollande will undoubtedly be forced to continue with many of the policies laid out by his predecessor, Nicolas Sarkozy. Quite simply, the unvarnished truth is that France must find 18 billion Euros of cuts by next year to maintain favourable to the markets and keep bond yields below the psychological danger zone of 7%. And, as a reminder for those who think the impact of the markets is overhyped it is worth remembering that they have already helped to claim the scalp of several European governments; including that of the infamous Italian Lazarus, Silvio Berlusconi.
It is therefore highly likely that once the hype around Hollande and his ‘rejection of austerity’ has died down the new French President will be limited to making a few token populist gestures; paid for by the increased taxation of the rich. As if to reiterate this point, German Chancellor Angela Merkel has already fired a shot across the bow of the new socialist President, warning that any previously agreed fiscal compacts were ‘not up for grabs.’
So, how does the recent European ‘rejection of austerity’ affect the millions of families across Britain who are struggling to make ends meet and the hundreds of thousands of well-educated young people unable to find a job with a promising career? The simple answer is that it doesn’t. Well, not really anyway.
Infact, to many of the public the only signs of any European spending will come from seeing a more confident Ed Miliband and subsequently resurgent New Labour exploiting the small benefits that any increased spending by a socialist President will no doubt bring. And also obviously Francois Hollande is the President of the Republic of France and not the United Kingdom. Aside from a few minor concessions on controversial tax issues such as the ‘granny tax’ and ‘pasty tax,’ it is highly unlikely that Osborne and Cameron will make a U-turn to dramatically increase spending. Such an approach was confirmed only earlier today in the annual Queen’s speech and an Andrew Marr interview in which Osborne laughably declared that “the national mood is now very much behind the deficit plan.”
Evidently people aren’t. Especially if you’re a pasty-eating pensioner with large savings and an unemployed grandchild.
Largely ignored by the mainstream media, a recent Centre for Economics and Business Research (CEBR) report has shown that in terms of the world economic league table rankings, Brazil overtook the UK in 2011 to become the world’s sixth largest economy. Whilst disappointing for Britain, other key European countries suffered a similar fate. By 2020 Germany, Italy and France are also expected to slide significantly down the league table, having been overtaken by the rapidly emerging Asian ‘tigers’ and BRIC countries. Aside from the obvious dent to national pride and international economic influence, what does the report mean for the future of the United Kingdom, Europe and the Western world?
When considering Western decline, most concerning for Europe, America and Japan is the spectacular rise of two BRIC countries; Russia and China. Largely reliant on natural resource exploitation for predicted future growth, Russia is both a past adversary of the West and a likely future one. Recent Russian defence spending has focused on enlarging the armed forces to cope with high unemployment, joint military manoeuvres with China and an increasingly bombastic international role culminating in the now largely forgotten 2008 invasion of Georgia.
Unlike Russia, China is not particularly resource rich. Despite this, the official Chinese military budget has increased by nearly 200% since 2001; this being fuelled by exceptional double-digit economic growth throughout the decade. Unofficially, the budget is rumoured to have increased by an even larger amount. This budget amplification has enabled the Chinese to design and produce advanced stealth fighters, create a naval base in the Seychelles to directly threaten India and purchase rusting Russian aircraft carriers. Again, similar to Russia, China has become increasingly vocal within international politics by peddling ludicrous territorial water claims and adopting an ever more offensive posture with regards to Taiwan.
When Russian and Chinese investment is contrasted with severe Western military budget cuts (including those recently announced by the United States) and combined with increased international posturing, commentators are rightfully concerned that the West faces a tough choice; to either submit to the new economic powerhouses or invest in the military and suffer from increased debts and economic stagnation. Furthermore, it is a certainty that at some point this century the United Nations Security Council will have to be overhauled to reflect modern day politics; this likely costing the West dear in terms of their previously almost unrivalled control of international affairs.
Faced with the CEBR report, continued Chinese and Russian intransigence combined with military expansion, a stubborn economic financial crisis and a continuous slew of disappointing economic data it would be rational for Western politicians to panic at the prospect of a century increasingly dominated by a series of unstable, unmanageable and untested countries. Especially countries ever more flush with cash and lacking a fondness for quaint European traditions, American excess or Japanese electronic domination.
However, this predictable panic is often unnecessary. Since 1945, the UK has been suffering from a slow international decline as the Empire has been gradually disbanded; a direct result of having fought and shouldering the burden of two devastating world wars. Despite such decline, this has not meant an end to peace and prosperity for the British people. Instead, decline has been ‘managed’ to ensure that aside from brief periods in history, British military power and influence around the globe has remained constant, national security has not been threatened and living standards have generally increased, decade after decade.
If managed correctly, many commentators are confident that gradual Western economic decline is not necessarily the doomsday scenario that scaremongers predict. Whilst international politics and conflict is inherently difficult to predict, unbiased observers are able to see that economic decline does not always correlate with a demise in international influence, foreign policy or military power. Provided that investment is made in the right areas, the British – and in some respects, Western – role in the world as nations of highly educated and skilled designers, service sector workers, high-end manufacturers and engineers can only complement non-Western economic growth. Indeed, the rapidly growing countries of Asia and Latin America need our skills and expertise as much as we need their natural resources and mass produced factory goods.
Whilst the CERB report is undoubtedly a blow to British and Western visions of self-importance, I can still see one reason within the report to be cheerful. Apparently, should the predictions turn out to be accurate the British rate of economic decline will not be as quick as that of our closest continental neighbour and age old national adversary, France. By 2020, the United Kingdom will have come from behind to beat the French to eighth in the global pecking order, and by quite a considerable margin too. Now that is a cause for celebration. Someone pass the Chardonnay…