MANCHESTER, England - Jobs have been lost, libraries shuttered, sailors sacked and street lights dimmed — Britain is beginning to taste the bitter medicine David Cameron warned was necessary to fix its wounded economy. It's left some wondering: Is the remedy worse than the symptoms?
As Cameron's Conservative party gathered in Manchester Sunday for its annual convention, the prime minister faced a test of his resolve to tame the country's ballooning budget deficit — his key priority since taking office in May 2010 at the head of Britain's first coalition government since the Second World War.
Though the sharpest measures of an 81 billion-pound (US$126 billion), four-year program of public spending cuts are yet to bite, there are fears that the drastic action intended to slash Britain's debts has stalled the country's stuttering economic growth — a point of growing unease between the Conservatives and their left-of-centre partners, the Liberal Democrats.
Figures released last month showed growth in Britain had slowed to 0.2 per cent in the second quarter, diminishing hopes that the country's businesses can generate new jobs to replace public sector posts being lost under the austerity plan. In the last year about 250,000 public sector workers have been laid off, and the country's jobless rate was 7.9 per cent in the period between May and July.
Cameron insisted Sunday that the government's plan would revive Britain's economy and leave the country on a sound fiscal footing.
"Things are difficult," he told the BBC, "but we need to explain to people what are we trying to build at the end of it."
Though Cameron's uncompromising plan to trim spending has won the confidence of credit rating agencies, the International Monetary Fund has warned that the U.K.'s growth is likely to stall further.
Last month the IMF cut its growth forecast for the British economy to 1.1 per cent this year from its previous forecast of 1.7 per cent in April, and urged Cameron to slow down the pace of austerity measures should growth fall even lower.
"From almost day one they had an austerity plan, but they had no plan for growth," said David Blanchflower, a professor at Dartmouth College and a former member of the Bank of England's Monetary Policy Committee, who has long been critical of Cameron's plans.
Opposition to Britain's spending cuts has already boiled over into street protests, with public sector workers marching on Parliament and students angry over rises to college tuition fees engaging in violent protests, including an attack on a car carrying Prince Charles and his wife Camilla.
Analysts suspect riots which flared in August — when mobs of young people torched cars and looted stores in several English cities — were sparked in part by a sense of desperation among jobless urban youths.
As Cameron prepares to make a keynote speech to the Conservative convention on Wednesday, he must choose whether to press ahead with his austerity plan despite creeping public concern, or soften the program and offer measures aimed at kick-starting growth.
He signalled Sunday that he would resist calls — now coming from some within his own party — to change direction by introducing tax cuts or spending schemes.
"Is it really a good risk to spend a few more billion now and potentially put at risk the low interest rates that are so key to your economic revival?" Cameron said.
"The key to a growth strategy is: are you making it easier for business to expand, to grow, to invest? And we are," he added.
Cameron's uncompromising line could increase tensions between his party and the Liberal Democrats. The smaller party, led by deputy prime minister Nick Clegg, used its own convention last week to pledge to be more assertive in its role as junior partner in Britain's governing coalition.
Critics have started to discuss the looming breakup of Britain's coalition — most likely shortly before the country's 2015 national election. "If it's a marriage, well it's a good natured one, but I'm afraid it's temporary. We're staying together for the sake of the kids," Tim Farron, Liberal Democrat president, told the convention.
But Cameron predicted the coalition would last till 2015 — though he stressed, "I'm happily married, but to my wife, not to Nick Clegg."
Steven Fielding, professor of political history at the University of Nottingham, said that so far Britain's public hasn't turned against Cameron's government, or its austerity plan — but stressed that many spending cuts slated for the next three years have yet to kick in.
"The cuts have been announced more than they have been applied; unemployment is rising, but it hasn't taken off. People are giving them the benefit of the doubt for now," he said
There is also a realization that as European trading partners labour under their own debt crisis and the U.S. grapples with a sluggish economy, Cameron may have little ability to deliver a return to prosperity. "The fate of this government is largely in the hands of people who don't live in Britain," Fielding said.
Cameron urged the 17 countries that use the European single currency — mired in political and economic crisis due to Greece's overwhelming debt — to act decisively to
"Frankly, right now the eurozone is a threat not just to itself, but also a threat to the British economy, but a threat to the worldwide economy," Cameron said.
"Action needs to be taken in the next coming weeks to strengthen Europe's banks, to build the defences that the eurozone needs and deal with the problem of debt decisively."
A ComRes telephone poll last month for The Independent put Cameron's Conservatives on 37 per cent, ahead of the main opposition Labour Party on 36 per cent. It was the first time the polling company had recorded a Conservative lead since Oct. 2010.
The survey of 1,000 adults by telephone between September 23 and 25, did not specify a margin of error, but it is typically plus or minus 3 percentage points in samples of a similar size.
Ed Miliband — elected as Labour chief a year ago after he narrowly defeated his better known brother David, the ex-Foreign Secretary — last week sketched the outlines of his own vision for Britain, ditching much of the legacy of predecessors Tony Blair and Gordon Brown.
He promised to overhaul Britain's "fast buck" culture by broadening out its financial services-dominated economy, to tighten flimsy regulation which allowed risky banking practices to fester, and — in a direct challenge to Blair's rhetoric — to challenge the eye-watering salaries racked up by executives.
His pitch suggested a direct link between bankers pursuing risky trades for personal profit, tabloid reporters hacking voicemail messages, teenagers who looted stores during England's riots, lawmakers exposed over their wild expense claims and celebrities who accrue vast wealth despite showing little talent.
Britain is a country "too often rewarding not the right people with the right values, but the wrong people with the wrong values," Miliband said.
While Cameron will appeal to Britain to hold its nerve and reap the future reward of his economic remedy, Miliband hopes to tap a simmering sense of injustice among middle-income workers — many of whom have seen their living standards decline.
"We've ended up with a financial crisis and you've ended up footing the bill," Miliband said last week, rehearsing his likely 2015 election pitch.