Posted Jun 30, 2024 By Martin Armstrong 

Naturally, The British Economist Magazine endorses Labour as they always do. So, it’s nothing of a surprise there. The polls on BREXIT were all wrong in the UK, for the polling appears to be more of a tool to force people to vote for their anointed politician. Britain’s prime minister, Rishi Sunak, surprised many by calling a general election for July 4th. Usually, in London, they celebrate the 4th of July, American Independence, but in the pubs, they would say – good riddance with a laugh and a smile.

The biggest economic risk to Britain is taxing worldwide income that they hide under the label of “Non-dom” which describes a UK resident whose permanent home – or domicile – for tax purposes is outside the UK. They only pay UK tax on the money they earn in the UK. They do not have to pay tax to the UK government on money made elsewhere in the world (unless they pay that money into a UK bank account). Going after the Non-dom makes it sound great; make those quasi-foreigners pay. The problem is they are there because of that status. Tax them on worldwide income and they might as well move to the USA even. They bring wealth to Britain insofar as they spend money in the local economy and pay taxes on property. Our model is already projecting a recession for Britain into 2028, which would certainly add to that economic impact.

Labour is selling itself as the party of “wealth creation” claiming it will improve the living standards for working people. They also insist that they will encourage more investment, but this has been languishing since 2016 in the UK. There are no real hardcore programs to encourage business – just claims of good intentions. They are pitching spending £3.5bn of public “green” investments, including upgrading homes and investing in hydrogen, which is not as bad as the USA or the EU, but this is still a fictional risk.

The polls show that his Conservative Party is in serious trouble, and the Labour opposition Labour Party entered the campaign with a commanding lead. People who are upset with the economy generally vote for the opposition, which has been pretty standard throughout history. The Guardian’s national poll tracker has Labour leading the Conservatives by just over 20 points. Vote shares are 41.3% Labour, 21.0% Conservatives, 15.5% for the far-right Reform, 11.1% Liberal Democrats and 5.8% Greens. Recent individual polls have Labour leading the Conservatives by 16 to 24 points. As you can see when we look at Labour and its historical performance, whereas they were at 35% and a 41% gain this time is by no mean a higher high over the era of Tony Blair.

The Conservative Party is in deep trouble. Nevertheless, its performance has been strikingly better over the years compared to Labour. Still, looking at the arrays, we have a serious turning point in British politics in 2025 whereas in Labour the next turning point is 2026.

Interestingly, while the computer does show that Labor should beat Conservative, there is projected resistance for Labor at 35.5%. Believe it or not, we may actually see the Conservative Party folding and being absorbed by Farage’s Reform Party. The last time such a takeover took place was after the 1987 election when the Liberal Party and Social Democratic Party (SDP) merged, forming an electoral alliance. As in this case, a Tory-Reform might unfold because it would be to their mutual advantage. Nigel Farage is anti-war, and this would help tremendously with saving Britain from this insane push for World War III. The problem with this possibility is that while Farage can lead the Reform Party, the Conservative membership would have to become subservient, lacking direction.

Political Party takeovers, mergers, and collapses are not rare. In the USA, Thomas Jefferson’s party, the Democratic-Republican Party, defeated the Federalists, who were never heard from again. However, eventually, Jefferson’s party split into what we now have: Democrats vs. Republicans. Even if we look at the Republicans today, essentially, they have undergone a hostile takeover by Donald Trump’s MAGA (Make America Great Again) Republicans. Today, Trump’s MAGA takeover of Republican politics is unchallengeable.

The same type of political crisis took place in Canada from 1993 to 2003. At the 1993 election, the Canadian Progressive Conservative Party was a complete disaster, much like the Federalists in Jefferson’s day. They were displaced by the new rise of the Canadian Reform Party, which took 52 seats. Yet, they were finally forced to merge with their adversary’s successor.

Of course, the British Press is attacking Farage because they see him as a threat. They call him far-right, yet he is against war. The British Press puts out the propaganda that Putin attacked Ukraine “unprovoked,” for they seem to want to wash their hands in the blood of their own people. Our computer shows that Farage and the Conservatives have a shot at merging to form a new government and a new party.