Peter Jukes looks at the differences between the crises of the 1970s and the current state of Brexit Britain – and finds some surprising but chilling echoes
Rapidly escalating energy prices, a crisis in supply chains, empty shelves in the shops, car manufacturing plants stalled, the army conscripted to deliver fuel to petrol stations – Britain, according to The New York Times, “is heading into a nightmarish winter”.
However, this ‘perfect storm’ is no natural meteorological phenomenon, but a direct economic result of the policies of Boris Johnson’s Government. “The bleak winter ahead,” The New York Times concludes “is of their own making.”
For anyone old enough to remember, it’s hard to avoid analogies between the crisis this winter and the infamous ‘Winter of Discontent’ of 1978-1979, illustrated with graphic images of uncollected black bin bags in Leicester Square and bodies not being buried in Liverpool.
Then, as now, that winter was a culmination of a global crisis, triggered by the worldwide restriction of oil supplies by the Organisation of Petroleum Exporting Countries (OPEC) in 1973 which led to two years of ‘stagflation’ – a combination of inflation and recession – and a steep rise in unemployment for most western countries that relied on oil imports.
But now, as then, Britain seems in a parlous position compared to its direct neighbours and competitors.
There are supply chain crises across the globe, mainly thanks to the Coronavirus pandemic. Container ports in the US are reaching full capacity, which means ships are stacking up outside the ports and a logjam for imports, especially consumer items for the Christmas season. The sudden rise in coal prices given a surge of demand has led to power cuts in China. In Germany, there’s an acute labour shortage, especially in road haulage and the surge in energy and petrol prices has led to a sudden rise in inflation, predicted to reach 5% by the end of the year. Even Russia – a major exporter of coal, gas and oil – faces rising food prices and a labour shortage since many migrant workers left during the Coronavirus crisis.
Yet, none of these countries are experiencing fights at fuel pumps, labour shortages across all sectors, and a year-long decline in imports and exports as Britain has since it finally left the EU at the beginning of the year. Byline TV has, since last October, documented the impact of Brexit on fishing, farming, hospitality, retail and haulage and now the combined shock is becoming too egregious for the rest of the media to ignore.
Car production in the UK has collapsed to 1950s levels, partially due to the shortage of semiconductors, but also due to a slump in demand owing to the new frictions at the UK borders for exports to Europe. The loss of two million EU workers is hitting key sectors in the run-up to the great festival of consumerism around Christmas this year. Pigs and turkeys are being destroyed before coming to market because there is a shortage of foreign workers in slaughterhouses and processing plants. Daffodils and other crops are being left to rot, while more than 500 firms polled by the Guardian attribute the lack of stock or fall in production due to staff shortages, with a collapse in confidence in the hospitality sector particularly acute. Only 18% of 200 restaurant, pub and bar businesses felt confident that they could recruit or retain the necessary staff, down 50% from just three months ago.
Our current Government seems incapable of dealing with the looming second Winter of Discontent mainly because so much of it is of its own making. But there is more in the analogy between Brexit Britain and the economic tribulations of the 1970s than that one sonorous Shakespearean catchphrase.
‘Crisis? What Crisis?’
In the interactive play Crisis? What Crisis? staged by the Parabolic Theatre group in London this summer, the audience was given a front-seat role in the unfolding drama around Jim Callaghan’s Labour Government, trying to avoid a no-confidence vote and a forced general election in the context of the Winter of Discontent of 1978-1979.
By taking part in either treasury decisions, civil defence, press management or the parliamentary whip, the audience could calibrate pay rises, enact or roll-back cuts to services, stave off backbench rebellion or sell-off state assets, with the combination of decisions leading to a different outcome at the end of each performance.
The night I attended, we managed to get Tony Benn back from New York on Concorde and negotiate a lower pay rise for road hauliers to avert a strike, and therefore the Callaghan Government just survived the no-confidence vote. But history proves that was only a temporary reprieve. Meanwhile, the matinee performance by Parabolic earlier that day had ended up in a communist revolution.
Drama aside, the ‘Winter of Discontent’ catchphrase – credited to the then Sun editor Larry Lamb – was already a misleading headline at the time.
Like Brexit Britain in 2021-22, the winter of 1978-79 was the culmination of five years of industrial strife triggered by the OPEC oil embargo in 1973, which rapidly led to the first miners’ strike in 50 years, national power cuts, and Conservative Prime Minister Edward Heath instituting an emergency three-day working week. For Britain, the ’70s economic crisis was not a seasonal melodrama but part of a much more epic narrative that went back to Britain’s poor economic performance compared to the rest of Europe in the post-war era – a victim of military victory, industrial complacency, and the loss of captured markets through decolonisation.
Yet, in the headlines of the time and the legends that came after, this bigger backdrop is often ignored. So too is the crucial decision to join and stay in the then EEC (European Economic Community) in the 1970s. Instead, the era is portrayed in dramatic caricatures – the overweening power of union barons and protective ‘Spanish practices’, sclerotic management, driven by an old boys’ network from private schools; government intervening in industry too much and choosing winners or losers, government not intervening enough and letting profiteers sell the family silver.
The crucial flaw in the British post-war economy was an overall failure of productivity: this is why the surge in inflation with the oil shock hit the UK particularly hard. Any wage increases were almost immediately passed on as price increases, which just perpetuated the inflationary spiral. Given the lack of stability and investment, recruitment and training stagnated, and the barriers to entry for the unemployed increased.