Boris Johnson’s “New Deal”

How the Prime Minister is Planning to Recover Britain’s Economy 

Boris Johnson’s “New Deal”

At the beginning of the new year, Boris Johnson tweeted a photo of himself giving two thumbs up, with a caption that read: “This is going to be a fantastic year for Britain.” Little did he know, in six months time the UK would be ravaged by one of the most devastating viruses known to modern medicine. The government’s late response to the pandemic caused the country to have the third highest death rate in the world (with only Brazil and the US performing worse), as well as the highest death rate in Europe. Moreover, lockdown measures caused the country’s GDP to fall by 2.2 per cent in the first three months of 2020.  This proved to be the country’s worst contraction since 1979. Given current this current predicament, the government is keen to revitalise the economy as soon as possible.

REOPENING A BIT TOO SOON? 

Last week the government announced that on July 4, many non-essential establishments would be opening for the first time since March. Restaurants, which have previously only opened for takeaways, will be able to operate normally, the same goes for cafes. Cinemas will also be open for business, and perhaps most importantly for Brits, pubs will finally open its doors to the public. While the government did say these establishments would have to be “COVID safe”, some fear that its elimination of the two-metre rule will provide leeway for pubs, restaurants and the wider public to bend the new “one-metre rule”. Moreover, even though cases in the UK have been falling since the country hit the peak in May, some have argued that the government should have waited longer before reopening. For example, curve graphs for COVID-19 cases in Spain and Italy show a consistently low number of new cases. The same method of measurement shows that the UK still gets small upticks in cases. 

JOHNSON’S “NEW DEAL”

Earlier this week, Boris Johnson announced an ambitious new economic recovery plan that aims at boosting investment on infrastructural projects. For its part, the government will be investing 5 billion pounds on numerous infrastructural projects, such as hospital maintenance, road projects and new school buildings. Perhaps the most crucial part of the announcement was the plan to build 180,000 affordable homes across the country. 

At first glance, there are some problems with the plan. For instance, while the government promised that it would spend money on maintaining hospitals, and improving A&E capacity, it did announce that it would eliminate mental health dormitories. Regardless of your political affiliation, a government should be lauded when it plans to improve hospitals, however in this incidence the government also should a massive disregard for mental health. Anyone who has been an avid reader of Johnson’s columns in the Telegraph will know that the current Prime Minister doesn’t have the deepest understanding of mental health, as in one of his articles he cited Churchill’s diligence as his coping mechanism against depression, thus implying that hard work is a one size fits all cure for mental illness. 

Furthermore, the way the government plans on establishing new affordable homes raises a lot of questions. The government has called its plan “project speed” because it aims to streamline the process of house building. For example, the government will allow commercial buildings to change for residential use without the need for a planning application. The government also wants to reduce the planning process for builders who want to demolish buildings and rebuild new ones. The reason why this might not be the best idea is because historically cutting corners in building projects has led to a number of problems when it comes to building durability and safety. One mustn’t forget that the aftermath of the Grenfell Tower tragedy has shown the devastating impact that cutting corners and cutting costs can have on people’s lives.

A new build home is pictured in Paddock Wood, Kent, in southeast England, on June 30, 2020. (Getty)

LACK OF EMPHASIS ON JOBS

Sir Kier Starmer, the leader of the opposition, was critical of the government’s plan. He cited that while an economic recovery plan is welcome, any viable plan should be centred on job creation rather than infrastructural spending. This comes amid fears that the pandemic will result in a massive number of job losses, especially after the current furlough scheme is set to end in October. 

The Prime Minister did address the issue of job creation though, as he argued that his plan would revitalise the construction industry and that the government would make sure that every young person would have an opportunity to take on an apprenticeship in that field. While Johnson’s plan did extensively mention the help it would provide to construction industry, it didn’t talk much of other industries, which are sure to be impacted from the current economic crunch.   

“I AM NOT A COMMUNIST”

Perhaps one of the most striking moments in the Prime Minister’s announcement was when he said: “My friends, I am not a communist. I believe it is also the job of government to create the conditions for free market enterprise.” During that segment of the announcement speech, the Prime Minister was addressing conservative critics who thought that the government was getting too involved in the economy, and that it was abandoning the principles of laissez faire free market economics.

As most people know by now, the Prime Minister likes to hark back to historical time periods and great leaders of the past. After all, he has never shied away from his love of late wartime Prime Minister Winston Churchill, and his mannerisms and speech patterns often hark back to Britain’s most revered leader and hero. However, during his announcement Johnson drew comparisons with the US’s 32nd President Franklin Delano Roosevelt (FDR), who revived the US’s economy during the aftermath of the Wall Street Crash of 1929. During his presidency, FDR implanted the New Deal that recovered the economy through a series of public work projects. Likewise, Johnson has compared his plan to that of FDR, and has even dubbed his plan the “New Deal”. This is significant since no one would have ever thought a Conservative Prime Minister would ever allude to an economic plan that many ill-informed individuals often cite as “socialist”. Even most US Democrats steer away from FDR style plans, and the only significant individual from that party who have ever mentioned a “new deal” styled plan is former presidential nominee Bernie Sanders. 

Whether or not you like this plan, it does mark a significant shift in Conservative economic planning, which since Thatcher’s premiership has focused on austerity. Even David Cameron and Theresa May stuck to Thatcherist ideals of little government spending and increased taxation. However, it seems now that Boris Johnson is attempting to steer the party away from such policies, and to present the party as one that is willing to spend for the good of the economy and society. Whether or not Johnson’s plans will cause a major long-term change in the Tory party still remains to be seen. 
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