Muddling Through

The British government last week invoked additional emergency measures to deal with what Prime Minister Edward Heath called the "gravest crisis since World War II." Burdened by fuel shortages, widespread labor strife and an unprecedented trade deficit expected to reach $3.5 billion this year, Chancellor of the Exchequer Anthony Barber announced a $3 billion slash in government spending. It was the largest budget slash in British history and signaled the end of Heath's go-go plan for economic prosperity.

The biggest deduction will come from the capital spending of nationalized industries ($600 million). The other major cuts include roads and transport ($490 million), defense ($395 million), health services ($277 million) and education ($240 million). The new budget clearly spelled the end of Heath's hoped for 3.5% economic growth next year; at best there will be no growth. Beyond that, Barber unveiled restrictions on installment buying of everything from refrigerators to automobiles. Consumers now will be required to pay one-third down and the rest within 24 months. Barber also imposed additional taxes on rental properties and ordered Britons earning over $17,500 to pay a surtax amounting to about a 1% raise in taxes.

Critics complained that the measures hardly met the dimensions of the crisis as sketched by Heath only the week before. At that time he decreed a three-day work week throughout the country, starting the first of the year; the measure could lead to massive unemployment. He also ordered power cuts of up to 40%, including measures like halting television shows after 10:30 p.m. After Barber announced the budget cuts, the London Times advised him to find another job. "What nobody wanted was a budget which did only half the job," said the Times. "That unfortunately is the budget we have been given." Like the opposition Labor Party, which had advocated strict inflationary measures, food subsidies and rent and mortgage controls, the newspaper denounced the budget cuts as too little too late.

Increasingly, Britons began to question whether there really was a severe crisis--or if Heath might be playing some kind of brinkmanship with recalcitrant unions. In his budget message, Barber followed Heath's lead and heaped blame for most of the country's woes on the miners who are demanding a 33% increase in minimum wages. Astonishingly, he barely mentioned any of Britain's other problems or ways to deal with them, like the country's monumental trade deficit or its out-of-control inflation rate (10% this year).

Even some conservative members of Heath's own party were critical. Declared Geoffrey Stewart-Smith, a Tory M.P.: "This bonehead government has driven the union moderates into the militant camp. It now will cost much more to get the miners back to work." Understated David Crouch, also a Conservative M.P.: "I don't believe that this confrontation [with the miners] is desirable."

Crouch, like a growing number of other observers, fears that the Prime Minister's militant attitude could touch off class strife in Britain's stratified society. Britons have generally sympathized with the miners' plight, but there is growing resentment against them over the coal shortage that they have caused by their month-long work slowdown.

Letter Bombs. Joe Gormley, president of the National Union of Mineworkers, said in an interview with TIME Correspondent William McWhirter last week: "The working man is becoming more and more aware that he is not getting his just share of the wealth he's producing. I think that's bound to happen in a country that has become better and better educated. Are we being so demanding?"

It is possible, of course, that Heath may have politics as well as economics on his mind: he could be maneuvering to back the miners down by exaggerating their role in the crisis; at the same time he could be trying to boost his public support by avoiding unpopular measures like an across-the-board raise in income taxes. Thus if the miners fail to come to terms, Heath still has one last option: he could call new elections and seek a vote of confidence.

Meanwhile, Britons were muddling through as usual. Office workers corn-batted lowered thermostats by taking extra sweaters to work. Some homeowners and shopkeepers did their bit to conserve energy by substituting candles for electric lights. Bishop William Milne installed a "dial a prayer" service in Worcester for people worried about the national emergency.

As if the economic crisis were not enough, London was hit last week by a new series of letter and car bombings. The first incident occurred when Brigadier Michael O'Cock, 54, an aide-decamp to Queen Elizabeth, opened a parcel at his London home and had part of his thumb blown off. Next day a bomb planted in a car near Westminster exploded shortly before 9 a.m., injuring 54 people. Police attributed the bombings to an apparent last-ditch effort by the Provisional wing of the Irish Republican Army to sabotage installation Jan. 1 of Northern Ireland's new coalition government of moderate Protestants and Catholics.

This file is automatically generated by a robot program, so reader's discretion is required.