Britain: Elusive Miracle

Precisely a year ago this week, Britain swallowed its pride and cut the exchange value of its tottering pound from $2.80 to $2.40. The third devaluation in 36 years was aimed at giving the country time to repair its foundering economy. The Labor government maintained that the devalued pound would swiftly turn the U.K.'s persistent trade deficit, a major source of sterling's troubles, into a surplus. With British goods much cheaper in the world marketplace, exports would rise while imports declined because foreign products automatically would cost Britons more. Surveying the early...