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Hunter, I thinl POTUS has begun to talk about the choices but not as
starkly. I thought you might find this piece of interest. - Michael

The end of Britain’s post-imperial ambition
By Philip Stephens
Published: October 21 2010 20:20 | Last updated: October 21 2010 20:20

Britain is turning in on itself. Cool Britannia, self-confident
globalism and liberal internationalism – all belong to a bygone era.
Finance has gone out of fashion. The time has come to pull up the
drawbridge and pay the bills. Introspection and austerity are the
leitmotifs of the new age. Things are going to get grim.

EDITOR’S CHOICE
Samuel Brittan: Deficit should be a policy variable - Oct-21

UK debt cost falls to lowest since 1980s - Oct-21

Opinion: Lazy local councils must act smarter to save more - Oct-21

Clegg hits back at criticism of UK cuts - Oct-22

Policing burden set to shift - Oct-22

Osborne vows not to backtrack on cuts - Oct-21

This week David Cameron’s coalition government unveiled its plans to
repair the large hole in the nation’s public finances. The
prescription is for public spending cuts bigger that anything seen
since the end of the second world war. The task? To eliminate a budget
deficit of about 10 per cent of national income.

Taxes are going up and living standards are set to fall. Half a
million public sector jobs are to be lost. Pay is to be frozen and
pensions reduced. Investment in the physical fabric of the nation –
roads and railways, schools, hospitals and housing – has been slashed.
The BBC will be shutting down channels. George Osborne, the chancellor
of the exchequer, was not exaggerating when he told the House of
Commons that closing the deficit would be painful.

Britain is far from alone in embracing fiscal conservatism.
Governments across Europe – and not just Greece and Ireland – have
been running scared of the bond markets. The banking bust has left a
sovereign debt crisis in its wake. The central bankers who blithely
ignored the warning signs during the boom years are now
thecheerleaders for austerity. Everyone wants to reduce their deficits
in what is beginning to look like a race to deflation.

Washington stands out among the western crowd, still more concerned
with sustaining economic growth and job creation than with tidying the
fiscal arithmetic. The Europeans tut-tut. Germany sides with China in
wagging a finger at US profligacy.

Some of us thought the banks were to blame for the economic mess. Now
we are told that spendthrift government has been the road to ruin. To
suggest that John Maynard Keynes had something useful to say about
managing demand during times of economic stress is to be branded a
deficit-denier.

Landing in Tokyo this week, as Mr Cameron’s government set about its
ferocious spending squeeze, I could not help but think that Europe’s
future is perhaps Japan’s recent past. Japan had its own crisis in the
1990s. Once through the worst, it decided it had better move quickly
to balance the government’s books. Too quickly: the result was a
decade of no or low growth.

Mr Cameron’s government prefaced Mr Osborne’s spending announcements
with a review of Britain’s defence posture. The prime minister called
it a strategic assessment. The officials and service chiefs charged
with implementation complain the exercise has been little more than
crude cost-cutting. Either way, Britain emerges a diminished power.

The government is holding on to some of the emblems of global reach.
The navy is to get two new aircraft carriers. The Trident nuclear
deterrent will be modernised. But there are insufficient funds to
properly equip the carriers with fast jets, so one will be mothballed
almost as soon as it is completed. Behind the “pocket superpower”
facade, the armed forces are to be hollowed out.

Trident meanwhile has become a pawn in Mr Cameron’s coalition
agreement with Nick Clegg’s Liberal Democrats. In one of the grimier
trade-offs in the spending package, the prime minister has agreed to
delay the Trident update in return for Mr Clegg’s backing for higher
tuition fees for university students.

There were brighter spots in Mr Osborne’s statement. Britain alone
among the big industrial nations is sticking to its pledge to increase
spending significantly on overseas aid. Some argue that gives Britain
a lot more authority in the councils of global affairs than another
squadron of fighter jets.

On the other hand, Mr Cameron intends to shrink the nation’s
diplomatic footprint. The Foreign Office faces a cut of about a
quarter in its budget. Ambassadors have been told to put traditional
diplomacy to one side; their first priority henceforth is to act as an
on-the-spot sales force for exports and investment opportunities.
Britain, the prime minister declares, is “open for business”.

That is as it may be, but it is also largely closed to foreigners – a
confusing message for the rising economic powers with which the
government wants to build closer relationships.

The general election saw something of a backlash against the sharp
influx of immigrant workers during 13 years of Labour government.
Nothing can be done to stem the flow from other European Union states,
so Mr Cameron has called a halt to immigration from elsewhere. The
best and the brightest from the emerging nations will have to find
more hospitable destinations.

It is hard to quarrel with Mr Cameron’s decision to set a deadline for
the withdrawal of British troops from Afghanistan. US president Barack
Obama, after all, has done much the same. Building a shiny new
democracy in Afghanistan was not an ignoble ambition. It has proved a
hopeless one.

Quite a lot of people will tell you that a more general retreat from
influence was also inevitable. Tony Blair’s premiership was but a
small detour on the long road of relative decline. Britain was living
on borrowed time and borrowed money. Cool Britannia was a last post-
imperial hurrah.

The world now belongs to China, India, Brazil, Turkey and the rest.
Mervyn King, the governor of the Bank of England, talks of a coming
decade of sobriety. Others remark – and rightly so – that rebuilding
economic strength at home is anyway an essential precursor to securing
influence abroad.

The deficit must be dealt with later if not sooner. Britain cannot
indefinitely pretend it is possible to match continental European
standards of welfare provision with US levels of taxation. A political
choice has to be made. The lesson from the wars in Iraq and
Afghanistan was that even before the cuts military commitments were
running far ahead of resources.

All of these things are true at least in part. On the other hand there
must surely be a story of Britain’s ambition that reaches beyond
balancing the books. Mustn’t there?