The UK economy will crash this year. That's certain. So, what do we need to do now?

Tue, 11 Aug 2026 05:06:07 +0000

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The closure of the Strait of Hormuz is not just another geopolitical shock. It is the beginning of a physical supply crisis that could transform the British economy and everyday life.

Oil, gas, fertiliser and food supplies are all under threat. This is not a banking crisis like 2008, and it is not a pandemic like 2020. This time, the problem is scarcity itself.

In this video, I explain why inflation caused by shortages cannot be solved with interest rate rises, why the Bank of England is going to use the wrong tools in this crisis unless it's told not to, and why rationing, price controls, and direct government intervention in the economy may become unavoidable.

I look at what this could mean for fuel prices, food supplies, mortgages, unemployment, social care, housing and the wider economy.

I also explain why banks could once again require public rescue, why governments may need to support strategic industries directly, and why conventional neoliberal assumptions may no longer work in conditions like these.

This is not an argument for panic. It is an argument for preparedness. Markets alone cannot manage a crisis created by shortages of essential goods. If governments fail to plan now, the social and economic consequences could be severe.

That's why wartime lessons from the past matter again. Rationing and price controls worked in WWII, and they might be needed now, when fairness will be essential to maintaining public trust during a period of major disruption.

The question is no longer whether the UK can afford to respond as I suggest is necessary. The question is whether it has the political courage to do so, because the real risk in this crisis is not that the government runs out of money. It is that it fails to use the powers it already has before events begin to spiral out of control.

Take a look at the poll below: https://www.youtube.com/post/U....gkxNEWZg7jWGZxVLY8-R

TRANSCRIPT
A transcript for this video is available at: https://www.taxresearch.org.uk

IF YOU WANT TO WRITE TO YOUR MP ABOUT ISSUES IN THIS VIDEO
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ABOUT RICHARD MURPHY
Richard Murphy is Emeritus Professor of Accounting Practice at Sheffield University Management School. He is director of Tax Research LLP and the author of the Funding the Future blog. His best-known book is ‘The Joy of Tax’.

This video was edited by Thomas Murphy.

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