Britannia Radio

Stock market prices fell this morning , especially of banks.
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TELEGRAPH - Leader   22.9.08
The Labour Party has its head stuck in the sand

Labour's annual conference in Manchester is a surreal experience, and 
not just because the sun is shining in a city notorious for its damp 
climate.

While the rest of us worry about a slowing economy, rising 
unemployment and falling house prices, the governing party obsesses 
about itself.

Just as the country cries out for direction and leadership, potential 
challengers to Mr Brown parade their credentials and pose for "at 
home" pictures without offering any analysis of what has gone wrong 
or what must happen next. The lack of focus on arguably the biggest 
financial crisis for 80 years is shocking.

In the hotel bars and on the fringes, debate is dominated by self-
preservation. The issue of Mr Brown's leadership is discussed in the 
context of what it means to Labour's fortunes, not to the country. 
There is a growing clamour for the Prime Minister to step down, but 
to what purpose?

Who leads Labour is becoming increasingly irrelevant to the real 
world that the rest of us inhabit. Many delegates, including some 
Cabinet ministers, give him six months to turn things around.

However, they then acknowledge that there would have to be a general 
election, at which Labour would surely be trounced. They agonise and 
fret over what to do; yet all they want is a better showing in the 
polls. Our concern is less with saving the necks of Labour's craven 
MPs than with the damage being done to the economy and the fabric of 
the nation.

Mr Brown says he understands the consequences of the financial crisis 
and considers himself to be the only politician with the experience 
to deal with it. Yet as the conference got under way yesterday, he 
reverted to his old instincts, which is to spend money he has not 
got, promising free nursery education for all two-year-olds. Leaving 
aside the wisdom of this, how does he think it can possibly be funded?

The Institute for Fiscal Studies has calculated that falling output 
by 2010-11 would leave revenues £65 billion short of Budget 
predictions. In a report today, the Centre for Economics and Business 
Research says that, once extra benefits for higher unemployment are 
included, borrowing will hit £90 billion next year, equivalent to six 
per cent of the economy, or £1,500 for every person, and double what 
the Treasury expected.

These are nightmarish figures that threaten a run on the pound and 
spending cuts of 1976 proportions.

Yet to listen to Mr Brown interviewed by Andrew Marr on BBC1 
yesterday was to get no sense at all of the gravity of this 
situation, nor was it much in evidence elsewhere. We trust we will 
hear something proportionate to the nature of the crisis when 
Alistair Darling, the Chancellor, speaks today.

There have been some brighter spots. Mr Brown was anxious to reaffirm 
his commitment to the free market and he is probably right to see the 
need for some global regulation of the financial system. However, he 
would accept no responsibility whatever for macro-economic mistakes 
during the 10 years he was chancellor. Everything was someone else's 
fault.

Paraphrasing Bill Clinton, he said: "It's the global economy, 
stupid." And, indeed, world conditions have played a significant 
part. But so, too, have domestic tax and spend policies, leaving 
Britain more exposed.

In his interview, Mr Brown quoted Joseph Conrad's advice for dealing 
with a typhoon: ''Facing it - always facing it - that's the way to 
get through." It was a revealing allusion because it suggested the 
crisis was, like the weather, nothing to do with the Government.

Until Mr Brown acknowledges Labour's complicity in the storm, he will 
continue to struggle to chart a way forward; and, for all the 
mutterings of mutiny, there is no sign that anyone else in his party 
would do any better. Difficult times require strong leadership. 
Instead, Labour is serving up self-obsessed in-fighting.

Come election day, the voters are unlikely to forget.
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MEDIA INTERVIEWS   22.9.08
(via PoliticsHome blog)
Govt not taking more money from economy, says Darling
Sky News
07:30 | 22/09/2008

Alistair Darling, Chancellor of the Exchequer

Mr Darling denied that the response to the economic crisis would 
necessitate a rise in taxation.

“This is not the time when you’d be taking money out of the economy,” 
he said.

He added: “This is the time to support the economy ... that’s what’s 
important you support the economy during this time you don’t start 
doing things that would actually make the situation worse”.  (Since 
revenues are falling and costs are rising the alternatives are :- (1) 
to raise taxes; (2) to cut expenditure; and (3) increase borrowing.   
He says he won;t do (1) or (2) but if he increases borrowing = well. 
just read the leader above  (“borrowing will hit £90 billion next 
year, equivalent to six per cent of the economy, or £1,500 for every 
person, and double what the Treasury expected.

These are nightmarish figures that threaten a run on the pound and 
spending cuts of 1976 proportions.“ -cs )

He also said that the government would do “everything we can” to 
ensure stability in the economy.

However he added: “In the medium term all governments have got to 
live within their means”.

07:45 Sky News

Mr. Darling added later that "what you do is you support the economy; 
as the economy comes through you get money coming in and that’s how 
you reduce the debt.

"You look at any economy over a period and when the economy slows 
down, government should support the economy.  But when times get 
better, you reduce the amount of debt."  [That’s exactly what Brown 
did NOT do when times were good -cs]

08:10 Today Programme, BBC Radio 4

Mr Darling addressed the issue of city bonuses. He said that a knee-
jerk reaction had to be avoided.

“We  need to do what is right and to avoid knee-jerk reactions - we 
need to avoid bonus systems that make people take risks,” he said.

“What I want the FSA to do is to look at the range of issues - action 
is needed, but we need to avoid compounding the problem with a knee-
jerk reaction,” he asserted.

The Chancellor spoke of the actions that the government needed to 
take over the next few months.

“As circumstances change, you need to make sure that your regulatory 
systems change as and when difficulties arise.

“As our economy slows down, it effects the amount of money that comes 
in - at a time like this, the government should support the economy.

“We have had a stable economy over the past ten years [a bubble built 
on excess credit -cs]  and that was due to very tight controls on 
spending [runaway extravagance in fact -cs] - that needs to continue, 
but we must also ease the pressure on the economy.”