Britain: A Cautionary Tale for America(noahpinion.blog)
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Britain: A Cautionary Tale for America
https://www.noahpinion.blog/p/the-uk-is-a-cautionary-tale-for-the
6 comments
> The NHS is struggling because we have an unhealthy population
I think we should stop pretending the NHS doesn't have quality and availability issues, which are validly pointed out in the OP article. I was shocked to discover that the NHS is paying out £60bn in compensation: https://www.bmj.com/content/391/bmj.r2211
Some of that seems to be claims inflation, but it also has to indicate a very real problem. The NHS runs an extremely "lean" system where people are triaged and it errs on the side of under-treatment. That saves money on treatment, but has other costs that don't immediately appear.
There are whole areas which are systematically under-funded to the point of nonexistance. If you're going to try for an adult ADHD or autism assessment, you're going to wait a very long time.
I don't have any answers myself, but I do wonder if going for the sacred cow of "free at the point of use" might work. But NHS dentistry isn't free and still experiences massive funding problems.
I think we should stop pretending the NHS doesn't have quality and availability issues, which are validly pointed out in the OP article. I was shocked to discover that the NHS is paying out £60bn in compensation: https://www.bmj.com/content/391/bmj.r2211
Some of that seems to be claims inflation, but it also has to indicate a very real problem. The NHS runs an extremely "lean" system where people are triaged and it errs on the side of under-treatment. That saves money on treatment, but has other costs that don't immediately appear.
There are whole areas which are systematically under-funded to the point of nonexistance. If you're going to try for an adult ADHD or autism assessment, you're going to wait a very long time.
I don't have any answers myself, but I do wonder if going for the sacred cow of "free at the point of use" might work. But NHS dentistry isn't free and still experiences massive funding problems.
The problem with changing the 'free at the point of use' principle is that under any likely replacement it would continue to be free for expectant mothers, children, the disabled, and the elderly - precisely the people who consume the largest proportion of healthcare resources.
And that means that introducing per-appointment charges would likely have only a very minor effect on reducing waste & improving availability. Healthy people of working age would see it as imposing extra charges for no tangible improvement.
Either that, or you'd need to be looking at introducing a two-tier NHS, which I don't think many people would be happy with - "it might work in Europe, but what if it ends up being more like America?" would be the worry.
I think your point about the importance of triage to being able to running "lean" is a better place to look for improvements. The Single Patient Record ought to make automated triage a lot more reliable, for instance. And taking a broader view of ongoing health & economic impacts would help with your ADHD/autism assessment use case, as well as similar issues affecting people of working age (maternity care, being another obvious example).
And that means that introducing per-appointment charges would likely have only a very minor effect on reducing waste & improving availability. Healthy people of working age would see it as imposing extra charges for no tangible improvement.
Either that, or you'd need to be looking at introducing a two-tier NHS, which I don't think many people would be happy with - "it might work in Europe, but what if it ends up being more like America?" would be the worry.
I think your point about the importance of triage to being able to running "lean" is a better place to look for improvements. The Single Patient Record ought to make automated triage a lot more reliable, for instance. And taking a broader view of ongoing health & economic impacts would help with your ADHD/autism assessment use case, as well as similar issues affecting people of working age (maternity care, being another obvious example).
> The problem with changing the 'free at the point of use' principle is that under any likely replacement it would continue to be free for expectant mothers, children, the disabled, and the elderly - precisely the people who consume the largest proportion of healthcare resources.
The disabled were scapegoated for much of my teens, I wouldn't be surprised if that continues; the elderly… I won't be surprised if someone realises an old person who needs treatment to live, doesn't get it, dies, isn't going to vote against the party responsible for that in the next election the way a pensioner whose income doesn't rise with the cost of living will be able to.
Mothers and children are still going to be important to look after. But with ever-decreasing fertility rates, I wonder if this has become much cheaper per capita already, and the "true" (steady-state) cost for this part of the NHS is therefore hidden, just as old-age care costs were hidden when the population pyramid was the old shape?
The disabled were scapegoated for much of my teens, I wouldn't be surprised if that continues; the elderly… I won't be surprised if someone realises an old person who needs treatment to live, doesn't get it, dies, isn't going to vote against the party responsible for that in the next election the way a pensioner whose income doesn't rise with the cost of living will be able to.
Mothers and children are still going to be important to look after. But with ever-decreasing fertility rates, I wonder if this has become much cheaper per capita already, and the "true" (steady-state) cost for this part of the NHS is therefore hidden, just as old-age care costs were hidden when the population pyramid was the old shape?
i think instead of asking the best way of dividing the costs, we should ask why does it cost so much. we've managed to bring down immensely the cost of technology over the past decades everywhere else.
Baumol effect is my best guess. Nursing tracks the cost of labour, the tech is (so far) making a small fraction of the worldload a lot more efficient, but the bulk of the workload is not (yet) amenable to automation.
That said, I do hear people sometimes complaining that the administrators were fired to save money, and this just put all that administrative burden onto the doctors and nurses who weren't trained in it and didn't go into medicine to perform; if that's true, tech may be able to assist with reducing that burden?
That said, I do hear people sometimes complaining that the administrators were fired to save money, and this just put all that administrative burden onto the doctors and nurses who weren't trained in it and didn't go into medicine to perform; if that's true, tech may be able to assist with reducing that burden?
The doctors vs administrators argument swings back and forth every 15-20 years or so. More (and better) tech might change things a bit but, in truth, it's mostly just a slightly different form of the "more administration" side of the debate.
But, actually, some of the tech programmes from the past decade have been effective - NHS Digital & NHSX, the NHS Spine, the work that's led to the Single Patient Record. All much smaller, simpler, and more agile than the gigantic, nightmarish NPfIT money pit of the 2000s. The post-Covid reorg, putting everything under NHS England, inevitably killed some of the momentum but there was real value created and people are doing their best to learn from the experience.
As you say, labour is the real cost driver - but a lot of that labour ought to be done under the banner of Social Care rather than the NHS. Of course, fixing Social Care isn't exactly simple, and will become almost impossible should the nativist right succeed in slashing the supply of care workers.
But, actually, some of the tech programmes from the past decade have been effective - NHS Digital & NHSX, the NHS Spine, the work that's led to the Single Patient Record. All much smaller, simpler, and more agile than the gigantic, nightmarish NPfIT money pit of the 2000s. The post-Covid reorg, putting everything under NHS England, inevitably killed some of the momentum but there was real value created and people are doing their best to learn from the experience.
As you say, labour is the real cost driver - but a lot of that labour ought to be done under the banner of Social Care rather than the NHS. Of course, fixing Social Care isn't exactly simple, and will become almost impossible should the nativist right succeed in slashing the supply of care workers.
>I think we should stop pretending the NHS doesn't have quality and availability issues, which are validly pointed out in the OP article.
I don't think anybody is pretending it doesn't. We just need to ask why it has got so bad since Covid and why we seem to be struggling more than similar European countries.
I don't think anybody is pretending it doesn't. We just need to ask why it has got so bad since Covid and why we seem to be struggling more than similar European countries.
> France also has four times the land area compared to the UK.
This is not by itself of great importance.
There's several different meanings of "built on", but even with the most expansive definition for this purpose, the UK could double how much is "built on" at a cost of around a tenth of what isn't: https://fullfact.org/economy/has-92-country-not-been-built/
There's other reasons to say "perhaps not a good idea" to a higher population (food security, energy security), but the land is there for more (or simply bigger) housing.
This is not by itself of great importance.
There's several different meanings of "built on", but even with the most expansive definition for this purpose, the UK could double how much is "built on" at a cost of around a tenth of what isn't: https://fullfact.org/economy/has-92-country-not-been-built/
There's other reasons to say "perhaps not a good idea" to a higher population (food security, energy security), but the land is there for more (or simply bigger) housing.
That land use has to compete with other uses such as agriculture, leisure and wildlife so the smaller available area is important if you want to make that sort of comparison.
Everything has to compete with everything, but:
(1) agriculture is both the biggest user and not done in a way that comes even close to maximising land efficiency; nor is there any reason it should, given there's not much pressure on agricultural land and the UK has easy access to cheap food imports.
(Even if there was pressure on farmland due to a loss of trade, it would be access to fertiliser that would cause more long-term issues than the land itself; phosphorus shortages would reduce carrying capacity in the range of 9-39 million depending who I ask).
(2) even with the UK's right to roam legislation, leisure use of most land is close to a rounding error. I mean, think about it for a moment: unless you live somewhere like Cambridge where the cows roam in the middle of the city, how often do you go to the middle of a cow pasture for a picnic? Ever tried taking a shortcut through a field of sunflowers (I did as a teenager, I don't recommend it)?
That said, on (2), UK land dedicated specifically to golf courses is close to (a little smaller than) UK land dedicated to housing: https://www.bbc.co.uk/news/uk-41901297
(1) agriculture is both the biggest user and not done in a way that comes even close to maximising land efficiency; nor is there any reason it should, given there's not much pressure on agricultural land and the UK has easy access to cheap food imports.
(Even if there was pressure on farmland due to a loss of trade, it would be access to fertiliser that would cause more long-term issues than the land itself; phosphorus shortages would reduce carrying capacity in the range of 9-39 million depending who I ask).
(2) even with the UK's right to roam legislation, leisure use of most land is close to a rounding error. I mean, think about it for a moment: unless you live somewhere like Cambridge where the cows roam in the middle of the city, how often do you go to the middle of a cow pasture for a picnic? Ever tried taking a shortcut through a field of sunflowers (I did as a teenager, I don't recommend it)?
That said, on (2), UK land dedicated specifically to golf courses is close to (a little smaller than) UK land dedicated to housing: https://www.bbc.co.uk/news/uk-41901297
>and with natural gas now extremely expensive due to the Ukraine war, the UK has been forced to rely on hideously expensive offshore wind power
But the wind is cheaper than gas. Yes you could argue that if we had stuck with coal that would have been cheaper than gas or wind, but the long term threat and the long term most expensive option is clear. Wind and solar gives energy independence, so we aren't reliant on a market that could be turned upside down by one country invading another.
But the wind is cheaper than gas. Yes you could argue that if we had stuck with coal that would have been cheaper than gas or wind, but the long term threat and the long term most expensive option is clear. Wind and solar gives energy independence, so we aren't reliant on a market that could be turned upside down by one country invading another.
Even the popular claim that "natural has is extremely expensive due to the Ukraine war" is misleading. In the UK and Europe high prices are by and large the result of policy and in fact high prices is exactly the aim.
I'm not sure that is true. The reason prices are high in the UK is that the government guarantees specific strike prices to investors to bring investment into new renewable infrastructure. So if someone builds a new offshore windfarm, they are guaranteed a certain return. The underlying strike price is calculated from the cost of natural gas, and therefore the price is being effected by various things, such as the US-Iran war. It is not designed to be a high price, it is just how the government has chosen to attract investment, specifically keeping the underlying price linked to gas.
Companies do bid against that strike price and if it is too low then they don't bid.
In Germany: 0.06 € / kWh was policy, 0.14 € / kWh was mainly Ukraine war. It's currently at about 0.10 € (policy + Ukraine war + Iran war). Taxes are fairly low: 0.0055 € / kWh and the usual 19% VAT.
It is policy to ban shale gas and more North Sea gas. In Germany it is also policy to exit nuclear, like it was policy to depend on Russia. VAT is policy. The Ukraine War is a convenient way to deflect from all the policy choices made over the last 20+ years, while still achieving the aim of high prices.
No, the goal of German policy isn't to kill its energy-intensive industry. Like in all countries, the conservative party, biggest member of the governing coalition, has strong ties to the local industry, and the social democrats have no interest in the loss of jobs. "The aim of high prices" is conspirationalist nonsense.
The aim of Nordstream (however misguided that turned out) was low prices.
Minor point: companies get the VAT back or don't pay it in the first place.
The aim of Nordstream (however misguided that turned out) was low prices.
Minor point: companies get the VAT back or don't pay it in the first place.
However you look at it they don't want fossil fuels to be cheap, as demonstrated by all the policies I mentioned. So the aim is indeed high prices (because this makes other energy sources more attractive) within the constraints of public opinion and the economy
Although the economy is suffering because this is all not well thought-out.
Again, saying it is politically suicide so they don't (mostly, Greens are open about it) but actions speak louder than words.
Again, saying it is politically suicide so they don't (mostly, Greens are open about it) but actions speak louder than words.
So what is the hidden agenda then, and by which actions did the government raise prices to 14 cents during the Ukraine war and 10 cents now? Why did they run a crash program to build LNG terminals, which lowered prices?
By all indications, "5-6 cents high" was politically desired, "10-14 cents high" isn't.
By all indications, "5-6 cents high" was politically desired, "10-14 cents high" isn't.
> Whether or not the Brits need our advice, we need to have our own internal discussion about what’s going on over in the UK and how we can use it to inform our own choices. And although there are still a few things to admire across the pond, the UK mostly now functions as a cautionary tale for the U.S. — yes, despite Trump, and guns, and high health care costs.
> Whether you think the UK has been falling behind America economically for a decade or for two decades depends on which set of prices you use to measure living standards. If you use the two countries’ national price indices, the UK has been growing slower than the U.S. since the financial crisis of 2008; if you use PPP prices, as Paul Krugman prefers, the UK’s relative stagnation has come only since Brexit in 2016:
> Whether you think the UK has been falling behind America economically for a decade or for two decades depends on which set of prices you use to measure living standards. If you use the two countries’ national price indices, the UK has been growing slower than the U.S. since the financial crisis of 2008; if you use PPP prices, as Paul Krugman prefers, the UK’s relative stagnation has come only since Brexit in 2016:
>if you use PPP prices ...
it was still on the uptrend until 2020 when switching off the economy squashed all growth and not just in Britain but other major continental economies too, Germany has actually been in and out of recession multiple times since.
2016 added some turbulence to domestic politics and econ but until then our recovery from the GFC had been fast, occasionally faster than the rest of the G7.
it was still on the uptrend until 2020 when switching off the economy squashed all growth and not just in Britain but other major continental economies too, Germany has actually been in and out of recession multiple times since.
2016 added some turbulence to domestic politics and econ but until then our recovery from the GFC had been fast, occasionally faster than the rest of the G7.
Germany isn't doing great, but these current recessions are low grade. Nothing like mid 90s and mid 2000s, unemployment data: https://www.wsi.de/de/erwerbsarbeit-14617-arbeitslosenquoten...
> 2020 when switching off the economy squashed all growth
The exception here is the US, again. And what did they do differently? Massive QE and "helicopter money". Anti-austerity worked extremely well for growth, even if the debt went up.
The exception here is the US, again. And what did they do differently? Massive QE and "helicopter money". Anti-austerity worked extremely well for growth, even if the debt went up.
Counter-cyclic fiscal policy and QE does work, absolutely, but it's likely dependent on size of economy because in most cases austerity works better...but in most cases the economies are much smaller than America's; Ireland, Estonia, Latvia, Lithuania, Italy, Greece (since austerity was forced upon it), HK, Britain could likely've been more austere during the GFC and seen more growth.
Then again although not comparable to America's it's possible that the British economy was/is large enough to sustain even more liberal fiscal policy but given the dependence on import and that it's primarily a service economy I doubt it.
America is truly exceptional.
Then again although not comparable to America's it's possible that the British economy was/is large enough to sustain even more liberal fiscal policy but given the dependence on import and that it's primarily a service economy I doubt it.
America is truly exceptional.
I thought austerity failed every time it was tried. When didn't it fail?
The examples I gave, primarily post GFC, except in the case of Greece the caveat is that although initially caused by the GFC the sovereign debt crisis marks it as distinct from the other economies listed.
HK under JJ Cowperthwaite (1961 to 1971), but more generally since then and especially pre '97.
HK under JJ Cowperthwaite (1961 to 1971), but more generally since then and especially pre '97.
Singapore, I'm told, from someone who lives there. I don't really follow their politics so take this with a pinch of salt appropriate for hearing things on the grapevine.
As someone who moved from the UK, to the US and back to the UK, my money goes a lot further in the UK.
I can afford to not work at all here. With health insurance, property taxes, and general outgoings per month being so much higher in the US (California, at least), there was no way I could retire early over there.
And whereas it's easy to hand-wave away "Trump, the healthcare, guns, ... " in a dismissive sentence, those things have real impact on a society and on the individuals living in that society. There's a reason [1] I moved away from the US, and will never return. Money-über-alles has its downside.
It's also worth noting (since the author brings it up) that the Mississippi comparison is pretty bogus. According to data from the Office for National Statistics and the US Census Bureau, median household wealth in Great Britain is substantially higher (around £300,000, or $403,000)[2] compared to the US ($175,000) [3] and Mississippi ($59,000). GDP and personal wealth are not the same thing.
1: https://news.ycombinator.com/item?id=44217106
2: https://www.ons.gov.uk/peoplepopulationandcommunity/personal...
3: https://www2.census.gov/library/publications/2024/demo/p70br...
I can afford to not work at all here. With health insurance, property taxes, and general outgoings per month being so much higher in the US (California, at least), there was no way I could retire early over there.
And whereas it's easy to hand-wave away "Trump, the healthcare, guns, ... " in a dismissive sentence, those things have real impact on a society and on the individuals living in that society. There's a reason [1] I moved away from the US, and will never return. Money-über-alles has its downside.
It's also worth noting (since the author brings it up) that the Mississippi comparison is pretty bogus. According to data from the Office for National Statistics and the US Census Bureau, median household wealth in Great Britain is substantially higher (around £300,000, or $403,000)[2] compared to the US ($175,000) [3] and Mississippi ($59,000). GDP and personal wealth are not the same thing.
1: https://news.ycombinator.com/item?id=44217106
2: https://www.ons.gov.uk/peoplepopulationandcommunity/personal...
3: https://www2.census.gov/library/publications/2024/demo/p70br...
> there was no way I could retire early over there.
It seems that the UK is becoming the new Portugal (warm retiree destination with stagnant non-retiree economy)
It seems that the UK is becoming the new Portugal (warm retiree destination with stagnant non-retiree economy)
That seems quite a claim from one datapoint...
Ah, more of a joke on your datapoint. And the traditional British practice of retiring to more southern locations in Europe.
:)
FWIW, I retired to the coast in the NW, I have a beach on one side of the house and a park on the other. It's pretty nice :)
Even up here in the NW though, it's been too damn hot recently...
FWIW, I retired to the coast in the NW, I have a beach on one side of the house and a park on the other. It's pretty nice :)
Even up here in the NW though, it's been too damn hot recently...
> Another lesson that Americans have already learned is the peril of excessive financialization of the economy
Don't mean to be blunt, but when did that happen? How has a country where you can finance your burrito [1] "learned the perils of excessive financialization"?
Also, a lot of this (especially the slower recovery after 2008) reads more as the perils of being the periphery of an empire vs being the core.
[1] https://finance.yahoo.com/markets/stocks/articles/uber-techn...
Don't mean to be blunt, but when did that happen? How has a country where you can finance your burrito [1] "learned the perils of excessive financialization"?
Also, a lot of this (especially the slower recovery after 2008) reads more as the perils of being the periphery of an empire vs being the core.
[1] https://finance.yahoo.com/markets/stocks/articles/uber-techn...
Britain and the US are nothing alike in the sense that in Britain, if you are valuable high earning worker you get actively punished for it with heavy and arguable unjust additional taxes. There are real incentives to working less and retiring early in Britain, so that's what most do.
Note on the economics here; why don't we look at the whole picture rather than one or two countries? Clearly America should be top of this list, right? https://en.wikipedia.org/wiki/List_of_countries_by_GDP_%28no...
.. no, that's Monaco. OK, so clearly we should exclude "microstates which are tax havens for billionaires" from the list. Does raise question about whether "excessive financialization of the economy" is actually bad: Monaco is entirely finance and tourism.
We then have to decide whether "finance microstate doesn't count" applies to Ireland and Switzerland. Let's give ourselves the benefit of the doubt and say yes; we're trying to get to a table where USA #1 and UK #2 appears.
So then we get to .. Norway? Not often held up as an economics model, more of a social model. It turns out that being a low population petro-state is also great for GDP. Let's rule those out as well, which takes care of Qatar. Finally we get to the US.
We're then left with only Denmark, Netherlands, Australia, Sweden, Israel (!), Austria, Germany, and Belgium above the UK in the table.
So I would say the lesson is not necessarily US exceptionalism or expensive European gas (which affects half that list, and note Israel is famously almost the only non petrostate in the Middle East), but that the UK is actually doing a lot worse than we realize for idiosyncratic reasons (probably including, but not limited to, Brexit).
Should we look at this table and copy whatever Ireland is doing to have twice our GDP? Would the average Brit recognize that Ireland is twice as rich as the UK? I'm not sure.
(The list of problems in the article is fairly valid, but they're unable to synthetize between "everything is underfunded" + "debt is bad" => the only arithmetically possible solution, "raise taxes")
.. no, that's Monaco. OK, so clearly we should exclude "microstates which are tax havens for billionaires" from the list. Does raise question about whether "excessive financialization of the economy" is actually bad: Monaco is entirely finance and tourism.
We then have to decide whether "finance microstate doesn't count" applies to Ireland and Switzerland. Let's give ourselves the benefit of the doubt and say yes; we're trying to get to a table where USA #1 and UK #2 appears.
So then we get to .. Norway? Not often held up as an economics model, more of a social model. It turns out that being a low population petro-state is also great for GDP. Let's rule those out as well, which takes care of Qatar. Finally we get to the US.
We're then left with only Denmark, Netherlands, Australia, Sweden, Israel (!), Austria, Germany, and Belgium above the UK in the table.
So I would say the lesson is not necessarily US exceptionalism or expensive European gas (which affects half that list, and note Israel is famously almost the only non petrostate in the Middle East), but that the UK is actually doing a lot worse than we realize for idiosyncratic reasons (probably including, but not limited to, Brexit).
Should we look at this table and copy whatever Ireland is doing to have twice our GDP? Would the average Brit recognize that Ireland is twice as rich as the UK? I'm not sure.
(The list of problems in the article is fairly valid, but they're unable to synthetize between "everything is underfunded" + "debt is bad" => the only arithmetically possible solution, "raise taxes")
> Israel (!)
What did you mean by that (!)?
What did you mean by that (!)?
Very different economy from the rest of that list. Economically it's like an Ireland (high tech and services) that spends 8% of its economy on war. And receives significant foreign aid.
US foreign aid received per capita is about $300 - against a GDP per capita of about $70,000.
(On the US side the aid sent is $10 per capita per year).
(On the US side the aid sent is $10 per capita per year).
Is that including all the money the US sends them for the war or is it only the money tagged as foreign aid?
If you have other figures, please quote them with sources rather than make vague implications that the amounts are significantly larger in a some mysterious way.
From what I found there was a one-off increase in 2024 due to the war, and a special payment in 2022 for the Iron Dome.
Averaging over the past 5 years, and including those special payments, it’s still $574 per Israeli per year. (And about $17 per American).
Compared to respective GDPs per capita of $70k and $95k.
From what I found there was a one-off increase in 2024 due to the war, and a special payment in 2022 for the Iron Dome.
Averaging over the past 5 years, and including those special payments, it’s still $574 per Israeli per year. (And about $17 per American).
Compared to respective GDPs per capita of $70k and $95k.
>France has roughly the same population as the U.K., but almost 50 percent more homes.
France also has four times the land area compared to the UK.
>The Economist ties Britain’s energy scarcity to its overly rapid and haphazard push for decarbonization; having banned coal, and with natural gas now extremely expensive due to the Ukraine war, the UK has been forced to rely on hideously expensive offshore wind power.
The dash for gas came about well before decarbonisation was on the agenda. It was instituted by Thatcher after the coal miners strike and because we had an abundance of it in the North Sea.
https://en.wikipedia.org/wiki/Dash_for_Gas
The NHS is struggling because we have an unhealthy population. A lot of that can be put down to behaviours we have adopted from the US (poor diet, car centric lifestyles and lack of exercise).