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British report
by Euro Reporter
2012-08-04 06:48:02 |
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Britain’s economy expected to shrink in 2012 as quick austerity hurts
Britain’s economy will shrink this year and any meaningful recovery will remain elusive until 2014 as the euro zone debt crisis and the government’s spending cuts weigh heavily on the country’s prospects, a leading think tank said Friday. The National Institute for Economic and Social Research said the country’s output could have been 239 billion pounds higher in total between 2011 and 2021, had deficit reduction been postponed by three years. NIESR’s analysis together with its forecast of a decline in gross domestic product by 0.5 percent in 2012, followed by only 1.3 percent growth in 2013, will fuel the heated political debate about the speed of Britain’s fiscal consolidation. The coalition government of Conservatives and Liberal Democrats has so far rejected calls to ease its tough plan of spending cuts and tax hikes, but the pressure is mounting after news that the U.K. is slipping deeper into recession.
The shock drop of output by 0.7 percent in the second quarter – when one-off effects such as an extra holiday to mark Queen Elizabeth’s 60 years on the throne and extremely wet weather compounded the general weakness – was the main driver behind NIESR’s lower GDP forecast for 2012. The economy was probably still in recession when stripping out those effects, which are likely to lead to a rebound in the headline growth rate in the third quarter, NIESR economist Simon Kirby said. But more importantly, the economy had not grown over the past two years and the debt crisis in the euro zone – destination for over 40 percent of British exports – would continue to hurt Britain, Kirby said. The 1.3 percent growth for 2013 was masking an even weaker momentum as some of the growth was due to inventory build-ups. However, unemployment looked now set to peak at 8.6 percent next year, below NIESR’s previous forecast of around 9 percent.
And despite weaker growth, the government was still likely to meet its goal to erase the structural budget deficit by 2017. The think tank applauded the government’s recent steps to boost the economy such as the Funding for Lending Scheme to get credit flowing, but it also reiterated its long-standing call for direct spending to kick-start growth. “It remains the case that there is scope for a less aggressive path of fiscal tightening,” NIESR said. “The government should consider on-balance sheet funding of key projects, concurrent with a comprehensive restructuring of banks and key funding markets,” the economists said. The think tank also analyzed how an alternative path for fiscal consolidation would have played out.
By postponing any tightening to the 2014/15 fiscal year, the loss of output would have been smaller because a depressed economy was more vulnerable to the fiscal headwinds, NIESR said. The government launched its austerity program in late 2010 and the opposition Labour party has since criticized Finance Minister George Osborne for cutting too fast and too far. The government’s plan still enjoys support from bodies such as the Organization for Economic Cooperation and Development and the International Monetary Fund, though the IMF has warned that fiscal loosening may become necessary if the economy fails to gain traction over the next six months.
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Victim’s parents convicted
The Pakistani parents of a teenage girl were been found guilty Friday of murdering her after she rebelled against their strict rules and a forced marriage to her cousin. The conviction was aided by the testimony of the girl’s younger sister, who said she saw her parents suffocate her sibling. Justice Roderick Evans sentenced the parents, Iftikhar and Farzana Ahmed, to life for killing their daughter Shafilea, 17, in 2003.
They were ordered to serve a minimum of 25 years in prison. Shafilea “was being squeezed between two cultures — the culture and way of life that she saw around her and wanted to embrace, and the culture and way of life you wanted to impose on her,” Justice Evans said. Shafilea’s younger sister, Alesha, testified that after an argument, her parents stuffed a plastic bag into Shafilea’s mouth and held their hands over her mouth and nose until she died. She said that after the attack, her father carried Shafilea’s body, wrapped in a blanket, to his car.
Shafilea’s decomposed remains were discovered in a river in 2004, but it was not until 2010 that Alesha provided the crucial testimony.
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In defence of Britain's multiculturalism
Multiculturalism is dead in the UK. Or, at least, that seems to be the depressing verdict of senior members of the British political, media and even theological establishments. In recent years, they have lined up to deliver the last rites for multiculturalism, their condemnation and critiques cutting across party and ideological lines. In 2005, Trevor Phillips, the then chairman of the Commission for Racial Equality (and now of the Equality and Human Rights Commission), warned that multicultural Britain was "sleepwalking to segregation". His analysis was shared by the Archbishop of York - Ugandan-born John Sentamu - and the Chief Rabbi, Jonathan Sacks, among others. In January 2007, before he became prime minister, Gordon Brown similarly claimed that multiculturalism had "become an excuse for justifying separateness". He preferred to talk of "Britishness" and a "stronger sense of patriotic purpose". In a speech in Munich in February 2011, Prime Minister David Cameron decried "the doctrine of state multiculturalism", which he claimed had "encouraged different cultures to live separate lives, apart from each other and the mainstream".
But guess what? None of these critics of multiculturalism seem to be able to offer a settled, coherent or accepted definition of that which they seek to pronounce dead. "The doctrine of state multiculturalism" has a certain ring to it, but what does it mean in practise? To what specific government policies, if any, does it refer? Cameron did not bother to elaborate in his speech. I would argue that British politicians and commentators have constructed a mythical version of multiculturalism - a "cardboard cut-out", to use a phrase employed by Cameron's Liberal Democrat deputy prime minister, Nick Clegg - and held it responsible for a raft of sins, from segregation and separateness to extremism and terrorism. To associate multiculturalism with terrorism and violence is outrageous. In August 2005, six weeks after the July 7 terrorist attacks in London, Le Monde published an essay entitled "The British Multicultural Model in Crisis". That same month, Gilles Kepel, the French scholar of Islamism, claimed that the London bombers "were the children of Britain's own multicultural society". Their attack, he said, had "smashed" the "consensus" behind multiculturalism in Britain "to smithereens". This is absurd. By any conventional criteria, the London bombers were well-integrated - their ringleader, Mohammad Siddique Khan, was a well-known and well-liked teaching assistant who eschewed an arranged marriage; Shehzad Tanweer, who detonated the Aldgate bomb, was an outstanding sportsman who had studied sports science in Leeds, and worked part-time at his father's fish-and-chip shop in the city. All four bombers spoke fluent English.
Is it true that British Muslims lack loyalty to their country? Lack patriotism? Don't want to integrate? No, no and no. According to a Gallup poll published in May 2009, British Muslims are more likely than non-Muslim Britons to say they identify strongly with the United Kingdom (77 per cent for the former, compared to 50 per cent for the latter). British Muslims are also more likely than non-Muslim Britons to want to live in mixed areas, among people of different backgrounds (67 per cent, against 58 per cent). Yet the attacks on "the British multicultural model" continue and intensify - and Islamophobia is on the rise. Multicultural cities such as Bradford, in the north of England, with big Muslim populations, are denounced as failures, smeared as ghettoised societies. Structural factors such as racism, poverty and industrial decline are ignored. But I for one can't help but be a defender of the UK's multiculturalism, of what the late Roy Jenkins, the Labour home secretary in the 1960s, defined "as equal opportunity, accompanied by cultural diversity, in an atmosphere of mutual tolerance". I am, after all, a product of multiculturalism; I consider myself to be British, English, Asian and Muslim. I see no contradiction between these ethnic, national, cultural and religious identities. My father arrived in this country from India in January 1965, with a second-hand London A-Z stuffed in his jacket pocket and £3 in his wallet. A child of the empire, he was born in Hyderabad in 1938 and came to Britain to study and work. It was not long before my father became a proud British citizen of Indian origin; he has since had two British children and a British grandchild. He arrived, however, in a country struggling to accommodate and integrate its burgeoning immigrant communities. Racial and cultural discrimination was rife; bedsits and hostels prominently displayed signs saying: "No dogs, no blacks, no Irish". My father had dog mess posted through his letter box.
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