There is no guarantee that the UK can make this switch. If you look at the table "Gross Domestic Product and its Components" in this OBR document, released yesterday, you will find some pretty heroic assumptions. Exports rise 90bn, fixed investment rises 60bn, and the trade deficit falls from 44bn to just 9bn - all over a period of five years. GDP grows by around 150bn over that period, while government consumption actually falls by 30bn.
There are problems with suddenly becoming an export economy (even before you get to how you deal with problem of declining standards of living at home). The first (and biggest) is everybody's going for austerity and exports. If everybody's churning out export products who's going to buy them? There's no guarantee. The Chinese, Japanese and Germans, for example, do have huge trade surpluses. Asking them to start buying means asking Chinese, Japanese and German capital to give up its competitive advantage at a time of global depression. It's not so likely (hence Obama's gripes at the surplus countries... an unfortunate phrase).
The other problem is what is Britain going to export? British manufacturing is second division stuff. We've got the Tories to thank for that. What about primary products? Well, Britain has much potential still left in its coal seams. But the Tories reopening the mines...? Ahem.
I've got it! The service industry. We can't drive Japanese trains or serve Germans hamburgers. What can we do? Domestic service... Butlers! Britain will export its domestic labour. There's the solution to our problems, put on a penguin suit and burp the idle rich.
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