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At present, the actual situation in the UK is not optimistic.

Text | Haishangke

On July 29th local time, British Chancellor of the Exchequer Rachel Reeves released a fiscal assessment report to the British Parliament.

The picture shows British Chancellor of the Exchequer Rachel Reeves (file photo)

In one word——

Britain is bankrupt.

In fact, the day before, British Prime Minister Starmer had already announced in advance that there was a £20 billion hole in the UK's finances.

On July 5, Keir Starmer delivered a speech in front of 10 Downing Street, the Prime Minister's Office in London, UK. Photo: Xinhua News Agency

As a result, the government is effectively bankrupt.

1

For individuals or some companies, 20 billion pounds is not a small amount, it can even be said to be an astronomical figure.

But this is Great Britain!

Even though Britain today is no longer the "Empire on which the Sun Never Sets" that once dominated the world, it is still one of the five permanent members of the United Nations Security Council.

At worst, the world has also seen that Britain, which once had no aircraft carriers left, has added two 70,000-ton aircraft carriers, the "Queen Elizabeth" and the "Prince of Wales", in recent years. It seems that there are no more than three countries in the world that have two aircraft carriers of 70,000 tons or more!

Taking the Queen Elizabeth as an example, the cost of building a single ship is as high as 5 billion US dollars.

In other words, the lack of funds that caused the UK to go bankrupt as Rachel Reeves said was only the cost of manufacturing five Queen Elizabeth-class aircraft carriers. You should know that the maintenance costs of these aircraft carriers are also quite high. 20 billion pounds is by no means a sum that will cause the UK to go bankrupt irreversibly. For example, if the aircraft carriers are sold and then the account is balanced, it can be restructured.

Another calculation can be made. In April this year, when the then British Prime Minister Sunak visited Poland, he stated that an additional 500 million pounds of military aid would be provided to Ukraine, bringing the total amount of military aid from the UK to Ukraine in the 2024 fiscal year to 3 billion pounds.

On April 23, then British Prime Minister Sunak, then British Defense Secretary Shapps, NATO Secretary General Stoltenberg, and Polish Defense Minister Kamies (from left to right) inspected Polish weapons and equipment in Warsaw

Then we can do some math problems again -

If the military aid to Ukraine is withdrawn immediately after the aircraft carrier is sold, perhaps the UK’s fiscal deficit can be eliminated by next year!

In other words, the Starmer government declared the UK bankrupt on July 28 local time and officially announced it in Parliament on July 29, but in fact the UK government's financial situation is not irreparable.

2

Why is the Starmer government declaring bankruptcy at this time?

In fact, it all comes down to party struggles. They hope that through this round of "declaring bankruptcy", they can further squeeze the British Conservative Party's seats in Parliament in the short term.

Look at what the Starmer government said -

Rachel Reeves claimed that over the past 14 years the Conservatives have made "unfunded spending promises" in a bid to win public support.

What that means is that when the Conservative Party is in power, they promise the public a lot of things.

But the question is whether the Conservative Party paid real money for this promise? How much real money did it pay?

It seems that Starmer, who is currently in office, still thinks with the mentality of an opposition party because his Labour Party has been in opposition for a long time. Even during the parliamentary debate, when the current Prime Minister Starmer saw his predecessor Sunak, he still called him "Prime Minister".

The Prime Minister is always the Prime Minister, and after a long time of fussing, I finally realized that Rishi Sunak is no longer the Prime Minister. "I, Starmer, am the current Prime Minister."

Sunak leaves 10 Downing Street

Otherwise, why did Hai Shu say that Starmer was still thinking in the way of the opposition party? Perhaps, after 14 years in opposition, there is a kind of inertia in thinking that is inevitable.

The Conservative Party also has inertia. It said that the Labour government is fabricating an excuse to increase taxes.

Uncle Hai wants to say:

If Sunak had not announced the general election in advance, Starmer would still be the leader of the opposition party today.

But if Sunak does not call a general election early while still in office, the Conservatives will suffer an even greater defeat in the parliamentary election once his term expires.

That is why, when the Conservative Party was defeated and lost its position as prime minister, it was still able to have a say in the Labour Party, which had become the ruling party.

When Starmer's environment secretary, Steve Reid, told the BBC that the previous Conservative government had "deliberately concealed" the true state of public finances, the Conservatives rushed to release information through the media that Britain was a country with "thriving wealth". That meant nothing more than that the Labour Party was looking for trouble.

3

Why would the Starmer government declare its country bankrupt at this moment?

Another interpretation is that in addition to hoping to outperform the Conservative Party in the election, the Labour Party also hopes to use various means to make British society as a whole agree to raise taxes.

Some analysts believe that the Starmer government may increase tax revenue by 10 billion to 25 billion pounds due to the tax increase. Global Network quoted an analysis published by the Financial Times as saying:

Mr Reeves is likely to increase capital gains and inheritance taxes and cut tax breaks for superannuation.

Some British government insiders also pointed out that the National Health Service is under pressure, especially in terms of hospital construction, which is "not funded and has an unrealistic timetable." In addition, defense, advanced manufacturing, the public sector and other fields are also under pressure.

In Hai Shu's opinion, who cares what the reason is. At present, whether it is the Conservative Party, which has been in power for 14 years and has little political legacy other than Brexit, or the Labour Party, which has always clamored for the British people to live a good life, it is actually difficult for them to come up with a strategy to make the British government function better. At present, the actual situation in the UK is not optimistic.

For example, in the Russia-Ukraine conflict, how Britain stands ultimately depends on the United States.

The dust on the U.S. presidential election has not yet settled - even Israeli Prime Minister Netanyahu understands this, so during his shortened visit to the United States, he will inevitably include separate meetings with Trump and Harris.

Israel's Netanyahu government simply hopes that after the US presidential election, the new US president will pay more attention to Israel.

Netanyahu (left) visits the United States and meets with US President Biden

The question is whether Britain is playing the coin-guessing game like Israel?

I always feel that even if Starmer does not want to follow the lead of the United States, the future policies of the United Kingdom will still depend on the United States. No matter whether they are Democrats or Republicans, as long as they are in power in the United States, their words will be the standard for the United Kingdom.

During the Conservative Party's administration, the UK withdrew from the EU. "America and Britain" and "Continental Europe" or "EU" have often become the two poles of internal conflicts in the West.

Looking at the issue from this perspective, did Britain’s “bankruptcy” begin today?

The discerning person already has the answer...

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