UNITED KINGDOM IN THE 70s
ECONOMY IN 70s
It was a traumatic economic decade of stagflation and the return of unemployment. In the other hand, it was also a decade of rising living standards, the growth of credit...
Barber Boom 1970-73
The early years of the 1970s were a period of rapid economic growth due to:
-- The Bank of England deregulated the mortgage market
-- Large tax cuts
-- Growth of Credit. This helped create a consumer bubble.
Recession since 1973
In 1973 all changed and can be studied through this graphs:
By 1973, inflation in the UK was accelerating to over 20%. This was due to:
-- Rising wages, partly due to strength of unions. -- The inflationary budget of 1972.
-- Oil price shock of 1973 (70% oil prices rise) -- Growth in credit and consumption
2. Crisis of oil
Suddenly the price of petrol more than doubled and the UK faced an energy crisis
3. Current Account deficit
High UK inflation was making UK goods less competitive. Also domestic consumer spending remained relatively strong - sucking in more imports.
4. 1976 IMF Bailout
This was due to high budget deficit and also concerns over the value of Sterling. The Pound to depreciate. So UK was forced to ask the IMF for a £2.3bn bailout to the IMF in 1976 saying unemployment and inflation were at exceptional levels and the State can no afford it.
POLITICS IN 70s. From Conservative to Labour governments.
The Conservatives returned in a general election on 1970. The new prime minister, Edward Heath. He was very enthusiasts in it goals but he only succeeded in negotiating Britain’s entry into the EEC, in 1973.
Edward Heath.
But he bad economic situation that we have seen lead to the Labour party to return by the hand of Wilson in 1974 and latter James Callaghan in 1976.
However the economical situations did not improve with inflation, oil prices increased and the discontent of the worker appeared in the named Winter of Discontent (1978-79). Strike action broke out across the country, extending from the industrial heartlands to the public sector.
It was a traumatic economic decade of stagflation and the return of unemployment. In the other hand, it was also a decade of rising living standards, the growth of credit...
Barber Boom 1970-73
The early years of the 1970s were a period of rapid economic growth due to:
-- The Bank of England deregulated the mortgage market
-- Large tax cuts
-- Growth of Credit. This helped create a consumer bubble.
Recession since 1973
In 1973 all changed and can be studied through this graphs:
- Inflation crisis
By 1973, inflation in the UK was accelerating to over 20%. This was due to:
-- Rising wages, partly due to strength of unions. -- The inflationary budget of 1972.
-- Oil price shock of 1973 (70% oil prices rise) -- Growth in credit and consumption
2. Crisis of oil
Suddenly the price of petrol more than doubled and the UK faced an energy crisis
3. Current Account deficit
High UK inflation was making UK goods less competitive. Also domestic consumer spending remained relatively strong - sucking in more imports.
4. 1976 IMF Bailout
This was due to high budget deficit and also concerns over the value of Sterling. The Pound to depreciate. So UK was forced to ask the IMF for a £2.3bn bailout to the IMF in 1976 saying unemployment and inflation were at exceptional levels and the State can no afford it.
POLITICS IN 70s. From Conservative to Labour governments.
The Conservatives returned in a general election on 1970. The new prime minister, Edward Heath. He was very enthusiasts in it goals but he only succeeded in negotiating Britain’s entry into the EEC, in 1973.
Edward Heath.
But he bad economic situation that we have seen lead to the Labour party to return by the hand of Wilson in 1974 and latter James Callaghan in 1976.
However the economical situations did not improve with inflation, oil prices increased and the discontent of the worker appeared in the named Winter of Discontent (1978-79). Strike action broke out across the country, extending from the industrial heartlands to the public sector.
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