Following a rebellion within his own Conservative Party, Boris Johnson announced his resignation, telling the nation that the selection of a new prime minister “should begin now.” The political environment has changed, according to a few of the prime minister’s former allies. Rishi Sunak, who resigned as chancellor on 5 July, stated in a statement that “our people need to know that if something seems too good to be true, it probably isn’t.” This is a startling admission from a politician who has spent the majority of the last six years touting the benefits of Britain severing connections with European Union (EU), its greatest trading partner while downplaying the expenses involved.
The paradox of Johnson was that he had fallen into a toxic unpopularity two and a half years after securing an 80-seat majority and the largest vote share for the Conservative party since 1979. According to a study conducted recently, 69 percent of Britons wanted him to resign. The pandemic’s ongoing repercussions on supply chains and the spike in gasoline and food prices brought on by the western sanctions on Russia for its war in Ukraine in February have hurt every major economy. However, compared to most of its counterparts, the UK has it worse. Despite a series of interest rate increases, inflation is expected to rise above 11 percent later this year. It reached a 40-year high of 9.1 percent in May, the highest rate among the G7 top nations. And according to the Bank of England, UK’s economic outlook has “deteriorated materially”.
European leaders and politicians reacted to the political turmoil in the UK following Prime Minister Boris Johnson’s resignation as head of his party with everything from a sigh of relief to worry about future relations. As Johnson and his administration strive to unilaterally disregard provisions of the Brexit treaty that pertain to Northern Ireland — known as the Northern Ireland Protocol — relations between the bloc and its former member have reached a low point.
Indeed, the Brexit movement was founded on telling people things that seemed too perfect to be true even at the time. However, when the costs of the Brexit divorce were more difficult to dismiss, its proponents pointed the finger at other causes like the COVID-19 outbreak and the war in Ukraine.
Johnson’s successors will now fight to distinguish themselves from that legacy. In his letter of resignation, Sunak outlines the principles that he and his competitors will uphold, including seriousness, competency, and honesty. It’s difficult to imagine many of the would-be prime ministers bragging that they helped “Get Brexit done,” even though some true believers may strive to carry on Johnson’s vision.
Situations also do not look promising due to the war in Ukraine. Following the start of the war, a number of nations announced significant increases in military spending. Both the United States and Canada have announced plans for increased military spending, while Australia likewise followed. 29 European countries have so far committed a total of more than $209 billion in increased defense funding; this amount will undoubtedly increase.
It is simple to see why support for these increases is required in the context of the war in Ukraine. The notion that raising defense spending will inevitably contribute to global security is misguided and dangerous. Increasing military spending can make the world more unstable and explosive rather than preventing conflict. While doing so, it diverts funds away from other pressing concerns like enhancing healthcare, preventing hunger, and combating the climate change.
To deal with the pandemic and compensate for the sanctions on Russia and others, governments have racked up historically high levels of debt. Although both military and social spending has immediate gains, nations must be conscious that a high and rising debt load could ultimately prevent them from making other future investments. The International Monetary Fund has previously issued a warning about this potentially disastrous scenario, stressing that “highly indebted governments would be most hit” and that “in the end, the impact will be most keenly felt by those people that can least afford it.”
A crisis in the cost of living is being fueled by the conflict in Ukraine. The European statistics office, Eurostat, said recently that the 12-month inflation rate in the Eurozone was 8.1%, the highest level ever. A YouGov Poll found that 83% of Spanish families, 80% of families in the UK, 76% of Italian families, 66% of French families, 65% of Danish families, and 62% of Swedish families all reported increased daily prices; add to that, the Ukrainian refugee problem.
The position of the public finances is worse now than it was during the height of the previous sovereign debt crisis. According to recent trends, financing requirements for governments could potentially rise in the months and years to come. The health crisis is still going on, and it has permanently damaged economies and public finances. The European Union was forced to spend money on sanctions, defense, resettling refugees, and finding alternatives to Russian energy as a result of Ukraine conflict. Coal, expensive gasoline from US is making an unwelcome entry into European continent as energy crisis engulfs Germany and Europe.
The next leader will instead have to deal with the challenging issues that Johnson tried his best to avoid: how to resolve the Northern Ireland conflict, whether to deviate even more from EU norms, and whether to reduce taxes or increase spending. In these way, the EU bloc’s influence in the UK may gain some momentum to bring and nurture BRENTRY (re-entry in the EU) sentiment among the political elites.