BRITAIN: The 4 1/2% Solution

Rarely if ever before had a British Labor Party heavyweight made such a boast. Yet last week Chancellor of the Exchequer Denis Healey was fairly cheering that the pay raises his countrymen would receive in the year beginning Aug. 1 are "likely to be below those in probably all Western developed countries." Healey's seemingly perverse enthusiasm was not misplaced: his negotiations achieved a union wage accord that was a needed early triumph for Prime Minister James Callaghan's five-week-old government.

The victory was written into a new pay-policy agreement concluded by the government and leaders of the powerful Trades Union Congress...

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