Lest we tempt ourselves that we are alone in this crisis: last week, one day before Audley Shaw spoke to Parliament, the British chancellor tabled his budget. Afterwards, it occurred to me it would have been quicker, and easier, for him to have just tacked a sign on the door saying 'Closing down'.
Until just a few months ago, British Prime Minister Gordon Brown liked to boast that his prudent hands had steered Britain into an age of fiscal responsibility and endless prosperity. How distant that all seems now. I was not among those who argued that the Labour government was headed for inevitable defeat in the next elections: there's more than a year left in its mandate, and it was a British prime minister who reminded us that a week is a long time in politics.
Those are the government's own figures. They may be a tad optimistic. Some independent analysts suggest the public debt will eventually rise to closer to 100 per cent. That would put Britain in a league with countries like Jamaica - developing countries striving not to be downgraded to the level of junk-grade on their public finances.
And yet curiously, the prognosis is, if anything, potentially bleaker for Britain. It is an ageing society with considerable obligations to its citizenry. That will either hem in future governments, limiting their freedom of manoeuvre; or it will force them to make painful adjustments to spending, challenging the citizenry's expectations of what a rich country's government can do for its people.
BEST DAYS ARE GONE
The Institute of Fiscal Studies, a London think tank, estimates that, as a result, the British economy's productive potential will be permanently reduced by 0.5 per cent. It will take two 'parliaments of pain' to slash spending and restore the country's accounts to health. Gordon Brown's 'golden rule' - that borrowing be used only to fund investment, and not current spending - might not be restored until 2032.
The ambitious wave of expansion in public services initiated under Tony Blair, which has not yet reached its goals, is set to end before it does so. A reduction in most services now seems inevitable. It is hard to read the analyses and not conclude that Britain's best days are behind it.
That conclusion may be premature. Nonetheless, in tackling one crisis, there is a risk that the British government may have simply planted the seeds of the next one. That is because Britain is hardly the only country in the world to be raising its borrowing so sharply. Many industrial countries now have fiscal deficits which, as proportions of their economies' output, rival Jamaica's.
Meanwhile, Jamaica has been trying for years now, with intermittent success, to move in the opposite direction. We may, rather unexpectedly, find ourselves in the happy position of leap-frogging up the international league tables for fiscal prudence.
That development could not come at a more opportune time. The global surge in public debt could lead to a sharp rise in borrowing costs down the road. Countries which have managed their finances well will be in a far better position to ride out the resultant storm.
The pain is inescapable. The choice appears to be to absorb it now, or transfer it to a later date. Probably feeling it had no choice, Britain chose the latter option. But difficult days now lie ahead for the country.
John Rapley is president of the Caribbean Policy Research Institute (CaPRI), an independent think tank affiliated to the UWI, Mona. Feedback may be sent to columns@gleanerjm.com.