The British economy has become a cautionary tale. Over the past year it has recorded the highest inflation rate in the G7 and one of the lowest growth rates. The government’s debt interest payments will be the largest in the developed world in 2023 (10.4 per cent of revenue), according to the ratings agency Fitch. Average British living standards are comparable to those of Alabama, one of the poorest US states. What explains this malaise?
One of those best placed to answer this question is Adam Posen, president of the Peterson Institute for International Economics and a former external member of the Bank of England’s Monetary Policy Committee (from 2009 to 2012). The US economist’s transatlantic experience gives him both an inside and outside perspective on “the British disease”.
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