Outside of the Olympics venues and amidst the celebrations, something else has been happening in Britain, and it provides a direct message about the immediate political and economic future of the United States:
Britain's economic output collapsed by 0.7% in the second quarter of 2012 as the country's double-dip recession extended into a third quarter.Analysts were stunned. And keep in mind that Britain's double dip had been expected since at least last March, and became official in April. The double dip itself isn't what stunned analysts, it's the just-announced magnitude of it. The worst in more than 50 years. And the political fallout?
Across-the-board weakness in manufacturing and construction coupled with the loss of output caused by the extra bank holiday to mark the Queen's diamond jubilee were responsible for the setback, according to data from the Office for National Statistics.
Analysts in the City had expected a 0.2% drop in gross domestic product in the three months to June and were stunned by the scale of the fall in activity.
(Chancellor of the Exchequer) George Osborne was coming under intense pressure from business, the City and the opposition on Wednesday to rethink his hardline austerity approach after news of a deepening double-dip recession dealt a severe blow to the government's deficit reduction strategy.And the view from labor:
The Bank of England is expected to embark on further emergency measures to stimulate growth this autumn following the release of official figures showing a shock 0.7% contraction in economic activity in the three months to June.
The (Trades Union Congress) general secretary, Brendan Barber, said: "The UK is on course for a longer depression than the '30s, the tightest squeeze in living standards since the '20s and more than a million young people are currently out of work. The government must abandon self-defeating austerity and prioritise public and private investment in infrastructure and in the futures of our long-term unemployed to get Britain working again."And the near-term temporary solution:
The UK is expected to emerge from its first double-dip recession since the 1970s in the third quarter, when a combination of the London Olympics and a bounce back from the production losses after the extra June bank holiday will provide a boost to activity.In other words, the economic stimulus that is government spending on the Olympics is expected to help bounce Britain's economy out of the recession next quarter. But that will be temporary. The real problem is this:
“Austerity is failing,” said Jonathan Portes, director of the National Institute for Economic and Social Research in London. “It’s clear that having a very sharp fiscal consolidation before the recovery had been firmly established was a mistake. We’ve seen a very sharp fall in public-sector investment and most of the deficit cutting has been in investment.”But the cruel stupidity that is economic austerity has been crushing economies throughout Europe, whose voters made the collective mistake of electing conservative governments at the worst possible time. And that's where we come back to Mitt Romney. And to this November's elections here in the United States. Because Romney embraces the very same type of austerity agenda that has failed with such devastating impact in Europe.
As I wrote last April:
The Republicans will offer a presidential nominee who would have let the auto industry go bankrupt, who thinks unemployment insurance is a disaster, who would cut Medicare and Social Security benefits, and who doesn't even want us to know where else he would cut spending. The Republicans will offer a presidential nominee who will cut benefits on just about everyone who needs them in order to finance tax cuts on corporations and the very wealthy. The Republicans will offer a presidential nominee whose austerity would be as cruel and stupid as that now crushing Europe, but which would benefit the extremely wealthy such as himself.Romney also embraces the Ryan Budget which would punish low income Americans, and seniors, and women, and students, while decimating health care spending. And even as the Department of Agriculture reported how food stamps reduce poverty, the Republicans want to cut them, too. And even as new data proved that the welfare reform of 16 years ago has resulted in more child poverty, Ryan also wants even more of that.
That Romney in but one day in London once again proved himself an utter ass was most surprising because it had seemed Romney's asininity no longer could be a surprise; but that isn't the most important part of the story. The real story is that while Romney runs around embarrassing himself and infuriating pretty much everyone else, the British economy is in tatters precisely because of the types of economic programs Romney wants to inflict on the United States. Romney most certainly won't shut up for once and pay attention to the lives of others, because he's always been completely self-absorbed and narcissistic, and he's never demonstrated the least concern for the lives of others. But we the American voters should pay attention. Because as shocking as it is, Romney's feckless foolishness is but a sideshow. The spotlight should be on the collapse of the British economy, and how a Romney presidency would import some recent Anglo-Saxon heritage that everyone should understand and no one should want to suffer.