Is there a bright side to the recession?
After the Tory front-bench spokesman for Health, Andrew Lansley, declared that "recession can be good for us", we ask what silver linings can be found in the current economic doldrums.
You can also add to the debate by leaving a comment at the end of the page.
The recession is just the market correcting.
The current recession was born primarily of credit bubbles in the US and UK. The sub-prime mortgage crisis in America, and the subsequent collapse of the housing market, exposed the overlending of credit on both sides of the Atlantic.
This recession is largely a result of that, and so is a natural economic process. The medicine may be harsh, but our economy will be healthier and more stable in the long run.
Market repossession or not, the public are suffering at an outrageous level. People cannot afford to turn their heating on , Age Concern research revealed that two in three over-65s are more worried that they will not be able to heat their homes sufficiently, compared with last winter(2). This is very worrying, for those people and for our society as a whole. The situation is desperate. People will lose their lives over these money concerns. It is ironic that this “medicine” you speak of will not save anyone, but kill them.
In addition to heating cost troubles, The Council of Mortgage Lenders (CML) estimates that 45,000 properties will be repossessed this year - up from 26,200 last year(1).
Economical analysts may claim that this is just the market correcting itself and there is nothing to worry about, but ask the people who are freezing over the winter and those who face their house being repossessed. I am sure you will get a different, graver response that’s shows the truth, that there is no bright side to this recession.
Britain will move away from being so focussed on work, and a new ethos of family will emerge.
In times of crisis, we tend to band together more - it's in the good times that individual greed has room to prosper. As in the Blitz, this severe economic crisis will encourage people to spend more time with their families (whether they'd like to or not!); Britain will, therefore, become a more sociable and family-centric society.
To the contrary, people will need to take second jobs in order to meet rising mortgages and bills. In fact, some employers are encouraging their employees to do so (1). This will not lead to more family time but less family time. In arguing that there is a bright side to the recession, one ideal being more family time, you are missing the point that in order to have family time you must have money. You need a house, owned or rented, and to have that house you need to work to pay the mortgage or the rent.
In addition, the credit crunch is causing adult family members stress. This stress around money breaks down marriages. Money is the second most common cause of divorce(2), given that we are going through a credit crunch, we can expect rising rates of marital breakdown.
Our economic and environmental priorities were wrong in the first place.
The prevalent capitalist dogma of profit maximisation, and growth for its own sake were ill-founded, under-scrutinised and ultimately destructive both economically and environmentally.
These principles have directly contributed to our ongoing environmental crisis and may, if left unchecked, lead to an eventual global environmental meltdown.
This recession is a wake-up call to big business and government alike to reassess our priorities, and offers an opportunity to recalibrate to some extent the way our economy is structured.
It is largely those principles of profit maximisation and growth that led to the UK having such a high monetary standard of living. The principles themselves aren't flawed, its how they operate in the market place that should be corrected.
More regulation is needed in the financial markets to ensure that such reckless lending and credit deals do not happen again.
Health is likely to improve.
There is evidence to suggest, as Andrew Lansley was trying to highlight, that recession often encourages greater physical health. As he said, "People tend to smoke less, drink less alcohol...[and] eat less rich food".
There is a danger that people on tighter budgets will be tempted to eat more pre-prepared ready meals, notorious for their unhealthy characteristics.
It is at least possible, however, that frugality encourages less extravagant eating, drinking and smoking habits [http://blogs.bmj.com/ebmh-talk/], and that this recession will help improve the nation's physical health overall.
Recession, and the associated financial hardships, have been found to significantly increase the chance of suffering from mental illness, most notably depression. As such, there is a real danger that prolonged recession will adversely affect the nation's mental health.
Cheap stocks! This is when then the poor man invest and a new generation of rich investors will emerge in the years to come!
There is a real danger that rising unemployment will compound the problem far further.
As a result of the collapse of financial markets around the world, unemployment is rising steadily. Because of this, consumer spending in the UK is falling drastically - the recent 2.5% cut in VAT was an attempt to stimulate spending.
There is a real danger that despite the cuts in VAT and the Bank of England interest rate, unemployment and job insecurity will force down consumer spending, causing more unemployment, and so creating a self-perpetuating cycle.
Economic recession encourages national political instability.
The state of a nation's economic health is intimately related to its political actions. It is difficult for a political party to push its own agenda for social change when it is so preoccupied with fixing the economy. Socio-political improvement will take a back seat, therefore, as long as the economy is wilting.
The economic downturn increases global social and political instability.
Political relations between East and West were far from excellent before the advent of the current economic downturn. Political analysts in the US are already calling China's $1.3tn foreign currency reserve a weapon of mass destruction, amid fears that any sudden sale of US dollars will provoke a further huge collapse in its exchange value.
The economic crisis, and the consequent weakening of the US economy overseas is allowing a shift in the power balance towards China. The vulnerability of the US dollar can only serve to heighten political tension between the two superpowers.
What do you think?