Can Britain Turn the Corner?

...For three years wages have been lagging behind prices and living standards have been dropping...

...More, I think, than mere prejudice (which 1 do not conceal) suggests that if the Conservatives win at the polls despite the present odds, the oil respite will be simply that ?0, 15 or at most 20 years of favorable balances of payments, but no end to the continuing weaknesses of British education, management and trade union sophistication...

...The pollsters agree that if Prime Minister James Callagfian had been foolish enough to submit to a general election in late 1976, the opposition Tories would have swept triumphantly into Westminster with a huge majority...

...Thatcher, whose inner circle consists mostly of reactionary figures like Sir Keith Joseph, a faithful follower of the Chicago school, promises drastic tax cuts and curtailment of public spending as necessary ingredients of her patent remedy for the British sickness—the unleashing of private initiative...

...This was no special dispensation—the doctor and his three partners made evening house calls in turn...

...On the surface, the reasons for Callaghan's sudden popularity are difficult to discern...

...Nor does it inspire confidence that with a single important exception, the good news all appears to be prospective...

...How average working-class and middle-class families subsist on English incomes at current price levels is something of a mystery...

...The good news that has already arrived, of course, concerns the substantial flow of North Sea oil, the first bit of genuine economic luck England has enjoyed since the Industrial Revolution, two centuries ago...

...There is a Socialist path to each of these objectives, but only a fool would be entirely confident of success in reversing an English economic faltering that is nearly a century old...

...for several years it has been either zero or negative...

...It also plunged into a Watergate-type scandal: As early as July of last year, internal estimates of the deficit were far larger than the figures offered by the chairman either to the public or to the Select Committee of Parliament that presumably was overseeing the industry...

...Few, perhaps, would be troubled that dinner at the Connaught costs about the same as a much better repast at New York's Lutece or La Ca-ravelle...

...The inevitable cynical cabdriver, a self-proclaimed life-long Labor voter, told me he had utter confidence that either set of politicians would fritter away the black bonanza and in a decade or two leave the country in much the same condition as before the deposit was discovered...

...Still, when one has a high temperature, aching joints, a wracking cough, and premonitions of mortality, it is reassuring to be visited by a mobile healer on one's bed of suffering rather than to wait through the endless night lor the morning office visit...

...a Republican song...

...A far cooler and craftier customer than Sir Harold Wilson, his immediate predecessor, Cal-laghan hung in there, made a deal with the Liberals—who feared total extinction in any quick election—and by the end of last year had not only wiped out the opposition edge in the public opinion polls but taken a slight lead of his own...

...Unemployment, now at a postwar high, would be still more sickening were it not for the notorious overmanning of factories and services...

...In the light of such daily experience and of the economic record, it is hard to accept the general impression —shared by political parties and the bulk of the media—that Britain has quietly turned a corner...

...Although in office Labor has been far from enlightened on questions of black and brown immigration, the opposition leader's shrillness has allowed government spokesmen virtuously to deplore her appeals to prejudice...

...While we were visiting a friend in the semirural north of England, my wife came down with the flu...

...brings forth fresh wonder at the weird nature of British politics...

...Rarely enthusiastic about British policy or prospects, it predicted at the start of the year that in 1978 price inflation would subside to single digits, the existing balance-of-payment surplus would swell, the pound would react with further gains against the dollar and the weaker European currencies, and economic expansion would resume, albeit at modest 3 per cent rates...

...Among much else, what is needed is a sharp increase in capital investment, a quantum jump in the quality of management, an end to a long tradition of elitest education, and a general improvement in the efficiency of day-to-day life...

...And not, it must be admitted, without some compelling reason...

...Whichever faction comes out on top, the task before a new Labor government would be the modernization of British society...

...In politics, six months is admittedly a long time, yet it now appears that Mrs...

...Britons, Harold Wilson used to say, enjoy the smack of firm government, and astute critics of Callaghan have taken to muttering that he is the best conservative prime minister in a long time...

...If anything like these projections comes to pass, Britain will actually perform somewhat better this year than Germany and France are likely to do...

...The Prime Minister's major "success" of a wet, cold winter was the breaking of a nationwide firemen's strike, called in a fruitless attempt to breach the government's 10 per cent wage-rise guideline...

...It is unclear, though, why she should have better luck in this laudable endeavor than such Conservative predecessors as Winston Churchill, Harold Mac-millan and Edward Heath...

...If it is true that capitalists get the unions they deserve, the irascibility and class hostility of British unions, and their almost Lud-dite suspicions of innovation, attest to the enormous failure of the British upper classes either to educate the mass of Englishmen for effective economic roles or to run the economic machinery efficiently enough to generate working-class confidence in their wisdom...

...When good, intelligent foreign friends like me recognize so clearly the shortcomings of British society, it is exasperating that the English are not nearly as unhappy about their situation as we know they should be...

...As any American medical economist, not to mention any American doctor, will readily demonstrate, house calls are an unproductive use of highly trained medical personnel...

...One of the best forecasts comes from the Organization for Economic Cooperation and Development...

...Even traditionally timid or lazy British MPs began to clamor after the fashion of their case-hardened American colleagues, for testimony, documents and the very blood of ministers...

...Nevertheless, it is rather alarming that dinner for two with a carafe of undistinguished red wine in an unpretentious Italian trattoria in Russell Square runs to $20, and a double room in a good but far from grand hotel costs between $50-$70 a night without breakfast and before service and Value Added Tax...

...The quality of private business management remains distressingly amateur, and since they draw upon the same personnel, the nationalized enterprises fare no better...

...Our hostess was able to get a genuine doctor to come to the house within an hour of her telephone call...

...by ROBERT LEKACHMAN JAMES CALIAGHAN London For this Anglophile, each visit to the old country (all right, suppose my grandparents did come from Poland...

...Possibly because she privately shares the general assessment of her electoral prospects, she has taken to lashing out in every direction, sounding more and more like Enoch Powell on putative threats to British racial purity...

...But for the longer run petroleum royalties present a problem of wise use not so different from that facing Saudi Arabia and Iran as patriotic Britons might like to think...

...On the record, the Tories do not have a clue to the riddle of reviving faltering entrepreneurial energies and persuading the tame tigers of British industry to emulate the aggressiveness of their Japanese and German rivals...

...A modest miracle indeed...

...In 1977 British Steel, for example, ran up a deficit of nearly $1 billion...

...They were 18 percentage points ahead of the disheartened, quarreling Laborites...

...Even now British taxes are no higher than the Common Market average, and British income and wealth distribution are far more unequal than Sweden's...

...ALabor victory would present more interesting possibilities...

...Maybe there is something to be said for inefficiency...

...The united pundits of the media predict, moreover, that Callaghan's April budget, the last before a probable autumn election, will shower tax cuts on the electorate, stimulate mild expansion, prevent unemployment from increasing, and widen Labor's advantage over Margaret Thatcher's Tory troops...

...Thatcher's moment has come and gone, that the British public will after all be spared her unique blend of Anita Bryant on social issues and Millon Friedman on the economy...

...It may stimulate a mild recovery...

...British-style, after all...

...A much shrewder politician than his American counterpart, Callaghan has somehow managed simultaneously to tame the fractious Left wing of his party, retain the Cabinet services of Energy Minister Anthony Wedgewood Benn, the Left's aging white hope, and, despite a quantity of grumbling, keep the support of the Trade Union Congress, in practice a body approximating the AFL-CIO Executive Council...

...Oil may keep Labor in power...

...Quite a performance...

...Serious British newspapers like the Times and the Guardian are priced higher than the New York Times by a whole dime...

...A professedly Socialist government has presided over successive ceilings on wage increases that, however leaky, have been rather more effective until very recently in holding down union contract gains than parallel price controls have been in keeping the cost of living within tolerable bounds...

...Americans ought to recognize the phenomenon: As Howard Baker happily exclaimed of Jimmy Carter in the wake of the State of the Union call to inertia, "He's singing our song...

...According to the omnipresent pollsters, most citizens are quite pleased with the quality of their lives...

...Consider this exemplary tale...

...Unhappy Liberals and Conservatives have been reduced to making their own flesh creep with dire predictions that once Labor safely negotiates the next election, it will swing sharply to the Left and commit all manner of nefarious deeds...

...For decades British growth has lagged behind the Common Market average...

...Public transportation and cabs, still somewhat cheaper than their New York equivalents, are escalating rapidly in cost...

...Whether oil opens the path to British economic renewal or not depends in part on the outcome of the next election, in part on the outcome of debate within the Labor party, and for the rest on substantial reform in British institutions and practices...

...Should the Social Democratic left carry the day, the tax reliefs would certainly be smaller and the emphasis upon the public sector much greater...

...Maybe the beer is flat, the central heating unreliable, the sales help baffled by the mysteries of arithmetic, and British Rails less and less on time—the English, damn it all, seem to prefer things that way...

...If the Social Democratic right wins the internal debate, the next Labor government would no doubt propose a judicious mixture of tax reMARGARET THATCHER duction, incentives to private investment and cautious expansion of public services and public investment...