The Observer view on how Britain’s crises can be fixed by a shift in political

Last year will be remembered as the most turbulent for the global economy since the 2008 financial crisis. Russia’s invasion of Ukraine drove an enormous increase in global energy prices, which led to inflation spiking across the world. And 2023 will be tougher still for many Britons; it will be a year of falling real pay at a time when the cost of essentials has never been higher.

The government would like us to believe this is purely the product of these global headwinds. But the truth is that a series of long-term structural problems has left the UK more vulnerable to massive global shocks than many other countries. From the dysfunctional housing market to sluggish economic growth to a complete failure to grapple with the consequences of an ageing population, these problems have been neglected by governments of both colours in past years, but have been made progressively worse by 12 years of Conservative rule. If they remain unaddressed they will stymie people’s quality of life for decades.

Britain’s growth prospects are poor by international standards. This is because for years economic growth was overpowered by a financial services sector whose flaws were exposed by the 2008 crisis. Reliance on the sector disguised a lack of productive capacity in the rest of the economy and big geographical variations in economic prosperity. The 2010s should have been used to build investment in the public services and skills infrastructure needed to boost productivity across the country. Instead, public spending cuts hit least affluent areas the most and the Conservatives pursued the hardest of Brexits for ideological reasons, which wiped a whopping 5.5% off GDP by mid 2022, according to one estimate. It is lower-income families who will most feel the impact on their standard of living. The government urgently needs to support exporting businesses by realigning trade with the EU, our closest and biggest trading bloc, and introduce policies that allow people to dip in and out of training throughout their working lives to ensure the economy has the skills it needs. And ministers, who have in recent years reneged on commitments to promote investment in green energy, need to prioritise low-carbon technology as a way to boost growth and ensure the UK fulfils its commitments to reduce carbon emissions to net zero by 2050.

The growing number of young people who will never be able to afford their own home is an indictment of politicians’ failure to address the worsening housing crisis. Britain has some of the most expensive rents in Europe and a housing market in which rising prices deliver windfall gains to homeowners at the expense of those who remain locked out of home ownership. This will increasingly affect many aspects of life: families having to move repeatedly, undermining any sense of stability for their children; people unable to relocate to take advantage of economic opportunities in higher-growth areas of the country; older renters reaching retirement with insufficient pension income to cover their rent. The number of…