Lessons to be learned from the UK’s recession
Dec 7, 2022, 12:00 PM | Updated: 12:06 pm
(Laura Seitz, Deseret News)
SALT LAKE CITY — “Recession” is a word that has not escaped the minds of Americans. When we observe some of the largest economies in the world like the United Kingdom, there are major takeaways we can learn from those overseas to help prevent economic disasters within our home.
Between inflation, living costs, the war in Ukraine and the pandemic, many Americans are experiencing financial crises.
The United Kingdom entering a recession offers ideas on what paths to avoid, many of them energy-related.
The U.S. has a leg-up when it comes to energy, according to Evan Ward, who is an associate professor of history at BYU.
Ward said the U.S. is a leading export of liquefied natural gas and holds the opportunity to use both fossil fuels and renewable energy resources.
In comparison, the UK, after Brexit, severed ties to pipelines that would have provided them key resources for energy.
Additionally, Ward pointed out that Utah has a trade relationship with the U.K. Utah trades a large percentage of industrial minerals to Great Britain, which also affects ties to Salt Lake and London aviation.
Utah was named the Beehive State for a reason. The work-together mantra helps run local industries successfully.
Further, the entrepreneurial spirit of Utah will help the economy increase production.
“Production always resolves questions of inflation, [by] getting more goods in circulation,” said Ward.
Comparatively, the U.K. has seen major inflation problems because it’s borrowing more than its economic growth can keep up with.
Simply, Utah, along with the U.S. should look to “grow their way out” of the inflation process with domestic products instead of borrowing too many resources.
When observing the energy crisis Ward feels the U.S. should avoid going down the same road as the U.K. Meaning, avoid jumping to unproven renewable energy sources when they may not be able to sustain the demand.
Overall, the potential for a recession within the U.S. could become reality in 2023. By observing the U.K., the U.S. can consider its sources of economic growth.