The current economic crisis, originating in the international financial crash of 2007-8, bears comparison with those of the 1890s and the 1930s.
The UK Coalition Government's economic strategy, centring on public spending cuts amounting to £81 billion and tax rises amounting to £29 billion by 2014-15, is designed to boost investor confidence and create space for a rise in domestic investment by the private sector, leading to growth in manufacturing and exports.
We can test the likelihood of a positive outcome from this strategy by comparing the current crisis with those of the 1890s and 1930s, since both share its global dimensions.
Recovery in the UK during the 1890s and 1930s was led by activity in the domestic rather than the international economy.
Although the international economic climate today is more benign than it was in the 1890s or 1930s, its buoyancy could be threatened by currency wars, spreading protectionism and the choking of the fiscal stimulus in the USA.
The Coalition's strategy has parallels with the one adopted by the Lloyd George Coalition in the early 1920s. Given the uncertain international outlook and the fragile state of the British economy, the implementation of 1920s-style cuts in a context of 1890s and 1930s-style crises threatens to lead to historically low rates of growth for many years
