It is clear that world opinion - not just German opinion - regards
Gordon Brown’s strategy as deeply flawed if not ultimately disastrous.
Here are various newspaper comments today all saying the same
thing., (I omit The Times since their Anatole Kaletsky - who is alm
ost always wrong - confines his comments to the idea “Borrow,
spend... then recoup it in energy taxes. Why taxing petrol more
fiercely could plug the budget black hole, revive the economy - and
help the car industry too” - which is bizarre verging on crazy! )
But the proof of the pudding in the end is exactly what Osborne
predicted - and was ticked off for doing so - a run on the pound!
When I last heard the euro was costing 88p against 75p a couple of
months ago. There is no logical reason why it should stop at
parity , The euro could well cost more than a pound! If it does -
and even already - Brown-Darling will not be able to borrow the vast
sums he was talking about only 2 weeks ago.
What would that entail? It would mean national bankruptcy with the
IMF dictating spending policy. That would mean Gordon Brown would
have wrecked the economy and the Welfare State too - all on his
own. That’s called “saving the world” in his terms!
Christina
========================
TELEGRAPH 11.12.08
Brown's economic rescue plan ineffective says German minister
[shortened to avoid repetition only]
Gordon Brown's multibillion pound economic rescue plan has been
dismissed as ineffective and expensive by Germany's finance minister.
By James Kirkup, Political correspondent
Peer Steinbrück launched an outspoken attack on Mr Brown's fiscal
stimulus package, saying a cut in VAT would have little impact and
predicting that the huge debts the Treasury is taking on will be a
burden on the UK economy for a generation.
The remarks are an embarrassment for the Prime Minister, who has
repeatedly claimed his plans have set the template that other
countries are following.
They came the same day Mr Brown was ridiculed in the Commons for
declaring that his policies had "saved the world."
Mr Steinbrück's remarks, in an interview with Newsweek magazine,
surfaced on the eve of a European Union summit where Germany is set
to reject Mr Brown's appeals for others to follow his lead.
Germany's chancellor, Angela Merkel, is a Conservative, but she leads
a coalition government and Mr Steinbrück is from the Social
Democrats, a centre-left party with links to Labour.
Britain's national debt is set to exceed £1 trillion as the Treasury
borrows an extra £500 billion over the next five years, some of it
paying for £20 billion of temporary tax cuts Mr Brown hopes will
soften the blow of the UK recession.
The heart of Mr Brown's package is the cut in VAT to 15 per cent
until the end of next year, something that will cost the Treasury
£12.5 billion.
Mr Steinbrück said the VAT cut would make little difference to
consumer spending.
He said: "Our British friends are now cutting their value-added tax.
We have no idea how much of that stores will pass on to customers. (-
- - - - - -)"
He added: "All this will do is raise Britain's debt to a level that
will take a whole generation to work off."
The minister also suggested Mr Brown had panicked by abandoning years
of fiscal discipline and budget-balancing policies in favour of
Keynesian spending financed by debt.
He said: "The same people who would never touch deficit spending are
now tossing around billions. (- - - - - - -) .
Mr Mr Steinbrück even likened Mr Brown's borrowing binge to the
practices that helped trigger the current financial crisis.
He said: "When I ask about the origins of the crisis, economists I
respect tell me it is the credit-financed growth of recent years and
decades. Isn't this the same mistake everyone is suddenly making
again, under all the public pressure?"
The Conservatives have stepped up their attacks on Mr Brown's
borrowing this week, demanding an early election to let voters judge
the Prime Minister's policies.
George Osborne, the Shadow Chancellor, said: "This comment from the
German finance minister totally demolishes Gordon Brown's central
political charge that only the Conservatives oppose his expensive and
ineffective vat measures.
Referring to Mr Brown's Commons gaffe, Mr Osborne added: "On the day
he claimed to be saving the world, the world answered back.
========================
THE INDEPENDENT 11.12.08
German minister ridicules Brown's recovery plan
By Nigel Morris, Deputy Political Editor
Gordon Brown's plans to soften the impact of recession have been
denounced as "crass" and "breathtaking" by the German Finance Minister.
Peer Steinbrück triggered a diplomatic row with Britain on the eve of
today's European economic crisis summit as he accused the Government
of "tossing around billions" and saddling a generation with debt. He
scorned the Prime Minister's decision to cut VAT and boost investment
on public projects at the cost of increasing national debt to £118bn
next year.
Dispensing with the usual niceties of diplomatic language, he
questioned the wisdom of following the philosophy of economist John
Maynard Keynes of using public cash to stimulate the economy. "The
switch from decades of supply-side politics all the way to a crass
Keynesianism is breathtaking," he told Newsweek magazine.
"When I ask about the origins of the [financial] crisis, economists I
respect tell me it is the credit-financed growth of recent years and
decades.
"Isn't this the same mistake everyone is suddenly making again, under
all the public pressure?"
Mr Steinbrück went on to question the effectiveness of this month's
VAT cut from 17.5 per cent to 15 per cent:
"(- - - - - - -) All this will do is raise Britain's debt to a level
that will take a generation to work off," he said.
European Union leaders will today begin debating a €200bn (£175bn)
fiscal stimulus package supported by Mr Brown with the backing of
Nicolas Sarkozy, the French President, and José Manuel Barroso, the
European Commission president. Their stance – discussed at a Downing
Street meeting on Monday – had already attracted Mr Steinbrück's ire
when he accused other European leaders of behaving like "lemmings" in
response to the crisis.
The comments of Mr Steinbrück, a Social Democrat, may not necessarily
be shared by the German Chancellor Angela Merkel, [The Indie should
not be silly! Merkel has been adamant that Germany wsill not take
part in the EU plan and is furious at not being included in the Brown-
Sarkozy-Barroso meeting in London this sweek! -cs] who is a
Christian Democrat, but they will raise the diplomatic temperature at
an already difficult summit, which will also discuss climate change.
George Osborne, the shadow Chancellor, said the comments "totally
demolished Gordon Brown's central political charge that only the
Conservatives oppose his expensive and ineffective VAT measures".
========================
FINANCIAL TIMES 11.12.08
The fiscal cure may make the patient worse
By Leszek Balcerowicz and Andrzej Rzonca
As the financial crisis attacks the economy, there is growing
pressure on governments around the world to introduce fiscal stimulus
programmes. This follows big interventions in the financial sector,
massive easing of monetary policy, especially in the US, and
substantial loosening of fiscal policy. The fact that there are time
lags between these interventions and their effects seems to have been
ignored.
The assumption appears to be that fiscal stimulus will automatically
revive private spending. But this belief contrasts with data that
show there is considerable uncertainty about the size and nature of
the stimulus required to cause spending to increase. [In other words
the Brown policy of VAT reduction at vast expense here in Britain is
a waste of enormous sums of money -cs]
Some say that financial crisis in the developed economies creates
favourable conditions for a strong Keynesian stimulus. This would,
the theory goes, boost the confidence of consumers and increase their
readiness to spend the extra money. The larger the stimulus, the
stronger its impact on consumer confidence and the greater the
multiplier effect. How this effect would be produced is not
explained. Instead we are given mechanical metaphors, such as “jump-
starting” the economy.
Consumers should not be regarded as Pavlov’s dogs, automatically
responding to stimuli offered by politicians. Consumers are guided by
expectations. They take a longer term view in making their spending
and saving decisions. This limits the stimulating effect of most
temporary tax cuts relative to permanent ones. Consumers also have
concerns about the fiscal sustainability of their governments in
assessing their long-term disposable income. Research suggests that
when the ratio of public debt to gross domestic product is already
high, the multiplier effect of fiscal stimulus is low. In extreme
cases, fiscal expansion may even be contractionary. This fact should
reduce the number of countries that undertake fiscal stimulus,
especially if one considers their unfunded liabilities and the fiscal
consequences of the public interventions undertaken so far.
Not only is there a danger that the high initial level of public debt
relative to GDP will limit the impact of any fiscal stimulus. In
addition, the sheer size of a stimulus package, which would lead to a
deterioration of a country’s fiscal position, may have a negative
effect on consumer confidence.
Consider Sweden’s banking crisis in the early 1990s. Discretionary
fiscal stimulus was immense, but counter-productive. With public debt
growing fast, households and entrepreneurs became pessimistic about
the future of the country. This pulled private spending down.
Besides, risk premiums rose to the same level as in Italy, which had
a tradition of excessively loose fiscal policy. This is a warning
that cheap financing of radically increased budget deficits should
not be taken for granted. The current crisis has taught consumers in
many countries that there are limits to their debt. Do we want to
learn this lesson in relation to the public debt as well?
A large fiscal stimulus may also turn out to have a negative impact
on financial intermediation. Financial turbulence generates the risk
of a credit crunch. How to mitigate this danger is a major worry of
many governments. One of the reasons banks are reluctant to lend is
they have insufficient capital. According to the International
Monetary Fund’s recent “Global Financial Stability Report,” banks
need globally almost $700bn (€540bn, £474bn) of additional capital. A
simultaneous large borrowing by governments to finance their fiscal
stimulus could make it more difficult for banks to gain access to
global capital markets and possibly limit any increases in their
capital and lending. The ability of the emerging economies to finance
their growth will also be affected. Large fiscal stimulus by
developed economies could deepen a credit crunch in the less
developed one.
One thing is sure: a large fiscal stimulus would increase public
indebtedness and impose a burden on future growth. Big increases in
public investments are likely to be wasteful, as it is not possible
to have a long backlog of well-prepared projects. In addition,
political pressures might dominate considerations. A large increase
in spending may also raise the possibility of corruption. A fiscal
stimulus that temporarily lowers indirect taxes at the cost of future
increases in marginal income taxes (for example, in the UK) does not
improve incentives to work, invest and innovate.
The effects of large fiscal stimulus in most countries are likely to
be disappointing, while the longer time impact would be negative. The
financial crisis is blamed on, among other things, deficient risk
management. The proposals for a large fiscal stimulus suffer from the
same weakness.
---------------------------------------------------
Leszek Balcerowicz, a former finance minister, deputy prime minister
and central bank president in Poland, is head of the international
and comparative studies department at the Warsaw School of Economics.
Andrzej Rzonca is an adjunct professor of economics at the Warsaw
School of Economics and the chief economist in the FOR Foundation
========================
SPECTATOR 11.12.08
Politics - FRASER NELSON
Fraser Nelson reviews the week in politics
Before a country has to beg the IMF for a bail-out, there are
normally several clear warning signs. Its national debt needs to be
vast — say, several times its entire economic output. Next, it
becomes dependent on that debt, as its government is unable to
balance a budget. Then, the downfall: its currency starts to devalue
rapidly, as the world begins to doubt whether this debt will be
repaid. The premiums to insure it against default start to soar. The
risk premiums demanded by creditors become simply unaffordable. And
then: pop.
It is still highly unlikely that Britain will go to the IMF, but the
highly unlikely has been happening rather a lot recently. Monday’s
newspapers had a full-page advertisement from a high-street bank
[HSBC since you ask! -cs] boasting about its ‘global vision and
prudent long-term strategy’. Seeing Gordon Brown’s leaden economic
clichés used to sell mortgages is an almost Orwellian sign of a new
economic order. Lord Mandelson, who railed against state bail-outs as
a European commissioner, is making an actual list of companies he
considers worth saving.
To judge by the newspaper headlines — the latest being an offer to
pay sacked middle-class workers to study for MBAs — one can labour
under the misapprehension that Mr Brown has stumbled across a cash
geyser. There seems to be no end to the money flowing from the
Treasury at the PM’s behest. Yet if the government is bailing out
companies, banks and mortgage holders, who is bailing out the
government? There is no clear answer to this, and it lies at the
heart of the biggest single peril the Prime Minister now faces.
========================
POLITICS HOME 11.12.08
========================
POLITICS HOME - Comment
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=
Sky News at 08:26
Balls: Germany will join international consensus
Ed Balls, Schools Secretary
Mr Balls said the attack on the government's economic strategy by the
German finance minister was prompted by "internal politics" and he
predicted the country would eventually join the international
consensus alongside the UK.
"I have known him for many years. He always had strong and robust
views but this says more about the current state of coalition
politics in Germany. When that is resolved you will find Germany
joining the consensus around the world.
"The Conservatives are the only people in the whole of the world
standing out against this. They are out of step with the times."
[It is not just the Germans who think that Brown’s policy of the
hugely expensive and totally ineffective VAT cuts is crazy. No other
country is doing anything so silly and the French have been equally
critical -cs]
Asked about the Prime Minister's "saving the world" slip, Mr Balls
said: "The Prime Minister did not mean to say that but the UK is
leading the world. We need to save the world from a deeper downturn."
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=
Sky News at 12:39
Cameron: German finance minister was saying what we're saying
David Cameron, Conservative leader
Mr Cameron said that the criticisms of Britain's handling of the
economic crisis by the German finance minister mirror those made by
the Conservative party.
"What the German finance minister was saying is what we're saying.
This enormous binge of borrowing is going to make the recession worse
and the recovery more difficult. That’s why we’ve got to stop it."
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=
“The more substantial point is that Steinbruck and his colleagues are
really pretty fed up about being lectured by Gordon Brown on how to
run their economy,” he said.
He added: “The German Social Democrats have long being telling the
British that the City of London and the sort of greed and
irresponsibility that took place in the financial market was
potentially very unstable”.
“Gordon Brown took the credit and lectured the Germans and they are
getting their own back in a serious way.”
Here are various newspaper comments today all saying the same
thing., (I omit The Times since their Anatole Kaletsky - who is alm
ost always wrong - confines his comments to the idea “Borrow,
spend... then recoup it in energy taxes. Why taxing petrol more
fiercely could plug the budget black hole, revive the economy - and
help the car industry too” - which is bizarre verging on crazy! )
But the proof of the pudding in the end is exactly what Osborne
predicted - and was ticked off for doing so - a run on the pound!
When I last heard the euro was costing 88p against 75p a couple of
months ago. There is no logical reason why it should stop at
parity , The euro could well cost more than a pound! If it does -
and even already - Brown-Darling will not be able to borrow the vast
sums he was talking about only 2 weeks ago.
What would that entail? It would mean national bankruptcy with the
IMF dictating spending policy. That would mean Gordon Brown would
have wrecked the economy and the Welfare State too - all on his
own. That’s called “saving the world” in his terms!
Christina
========================
TELEGRAPH 11.12.08
Brown's economic rescue plan ineffective says German minister
[shortened to avoid repetition only]
Gordon Brown's multibillion pound economic rescue plan has been
dismissed as ineffective and expensive by Germany's finance minister.
By James Kirkup, Political correspondent
Peer Steinbrück launched an outspoken attack on Mr Brown's fiscal
stimulus package, saying a cut in VAT would have little impact and
predicting that the huge debts the Treasury is taking on will be a
burden on the UK economy for a generation.
The remarks are an embarrassment for the Prime Minister, who has
repeatedly claimed his plans have set the template that other
countries are following.
They came the same day Mr Brown was ridiculed in the Commons for
declaring that his policies had "saved the world."
Mr Steinbrück's remarks, in an interview with Newsweek magazine,
surfaced on the eve of a European Union summit where Germany is set
to reject Mr Brown's appeals for others to follow his lead.
Germany's chancellor, Angela Merkel, is a Conservative, but she leads
a coalition government and Mr Steinbrück is from the Social
Democrats, a centre-left party with links to Labour.
Britain's national debt is set to exceed £1 trillion as the Treasury
borrows an extra £500 billion over the next five years, some of it
paying for £20 billion of temporary tax cuts Mr Brown hopes will
soften the blow of the UK recession.
The heart of Mr Brown's package is the cut in VAT to 15 per cent
until the end of next year, something that will cost the Treasury
£12.5 billion.
Mr Steinbrück said the VAT cut would make little difference to
consumer spending.
He said: "Our British friends are now cutting their value-added tax.
We have no idea how much of that stores will pass on to customers. (-
- - - - - -)"
He added: "All this will do is raise Britain's debt to a level that
will take a whole generation to work off."
The minister also suggested Mr Brown had panicked by abandoning years
of fiscal discipline and budget-balancing policies in favour of
Keynesian spending financed by debt.
He said: "The same people who would never touch deficit spending are
now tossing around billions. (- - - - - - -) .
Mr Mr Steinbrück even likened Mr Brown's borrowing binge to the
practices that helped trigger the current financial crisis.
He said: "When I ask about the origins of the crisis, economists I
respect tell me it is the credit-financed growth of recent years and
decades. Isn't this the same mistake everyone is suddenly making
again, under all the public pressure?"
The Conservatives have stepped up their attacks on Mr Brown's
borrowing this week, demanding an early election to let voters judge
the Prime Minister's policies.
George Osborne, the Shadow Chancellor, said: "This comment from the
German finance minister totally demolishes Gordon Brown's central
political charge that only the Conservatives oppose his expensive and
ineffective vat measures.
Referring to Mr Brown's Commons gaffe, Mr Osborne added: "On the day
he claimed to be saving the world, the world answered back.
========================
THE INDEPENDENT 11.12.08
German minister ridicules Brown's recovery plan
By Nigel Morris, Deputy Political Editor
Gordon Brown's plans to soften the impact of recession have been
denounced as "crass" and "breathtaking" by the German Finance Minister.
Peer Steinbrück triggered a diplomatic row with Britain on the eve of
today's European economic crisis summit as he accused the Government
of "tossing around billions" and saddling a generation with debt. He
scorned the Prime Minister's decision to cut VAT and boost investment
on public projects at the cost of increasing national debt to £118bn
next year.
Dispensing with the usual niceties of diplomatic language, he
questioned the wisdom of following the philosophy of economist John
Maynard Keynes of using public cash to stimulate the economy. "The
switch from decades of supply-side politics all the way to a crass
Keynesianism is breathtaking," he told Newsweek magazine.
"When I ask about the origins of the [financial] crisis, economists I
respect tell me it is the credit-financed growth of recent years and
decades.
"Isn't this the same mistake everyone is suddenly making again, under
all the public pressure?"
Mr Steinbrück went on to question the effectiveness of this month's
VAT cut from 17.5 per cent to 15 per cent:
"(- - - - - - -) All this will do is raise Britain's debt to a level
that will take a generation to work off," he said.
European Union leaders will today begin debating a €200bn (£175bn)
fiscal stimulus package supported by Mr Brown with the backing of
Nicolas Sarkozy, the French President, and José Manuel Barroso, the
European Commission president. Their stance – discussed at a Downing
Street meeting on Monday – had already attracted Mr Steinbrück's ire
when he accused other European leaders of behaving like "lemmings" in
response to the crisis.
The comments of Mr Steinbrück, a Social Democrat, may not necessarily
be shared by the German Chancellor Angela Merkel, [The Indie should
not be silly! Merkel has been adamant that Germany wsill not take
part in the EU plan and is furious at not being included in the Brown-
Sarkozy-Barroso meeting in London this sweek! -cs] who is a
Christian Democrat, but they will raise the diplomatic temperature at
an already difficult summit, which will also discuss climate change.
George Osborne, the shadow Chancellor, said the comments "totally
demolished Gordon Brown's central political charge that only the
Conservatives oppose his expensive and ineffective VAT measures".
========================
FINANCIAL TIMES 11.12.08
The fiscal cure may make the patient worse
By Leszek Balcerowicz and Andrzej Rzonca
As the financial crisis attacks the economy, there is growing
pressure on governments around the world to introduce fiscal stimulus
programmes. This follows big interventions in the financial sector,
massive easing of monetary policy, especially in the US, and
substantial loosening of fiscal policy. The fact that there are time
lags between these interventions and their effects seems to have been
ignored.
The assumption appears to be that fiscal stimulus will automatically
revive private spending. But this belief contrasts with data that
show there is considerable uncertainty about the size and nature of
the stimulus required to cause spending to increase. [In other words
the Brown policy of VAT reduction at vast expense here in Britain is
a waste of enormous sums of money -cs]
Some say that financial crisis in the developed economies creates
favourable conditions for a strong Keynesian stimulus. This would,
the theory goes, boost the confidence of consumers and increase their
readiness to spend the extra money. The larger the stimulus, the
stronger its impact on consumer confidence and the greater the
multiplier effect. How this effect would be produced is not
explained. Instead we are given mechanical metaphors, such as “jump-
starting” the economy.
Consumers should not be regarded as Pavlov’s dogs, automatically
responding to stimuli offered by politicians. Consumers are guided by
expectations. They take a longer term view in making their spending
and saving decisions. This limits the stimulating effect of most
temporary tax cuts relative to permanent ones. Consumers also have
concerns about the fiscal sustainability of their governments in
assessing their long-term disposable income. Research suggests that
when the ratio of public debt to gross domestic product is already
high, the multiplier effect of fiscal stimulus is low. In extreme
cases, fiscal expansion may even be contractionary. This fact should
reduce the number of countries that undertake fiscal stimulus,
especially if one considers their unfunded liabilities and the fiscal
consequences of the public interventions undertaken so far.
Not only is there a danger that the high initial level of public debt
relative to GDP will limit the impact of any fiscal stimulus. In
addition, the sheer size of a stimulus package, which would lead to a
deterioration of a country’s fiscal position, may have a negative
effect on consumer confidence.
Consider Sweden’s banking crisis in the early 1990s. Discretionary
fiscal stimulus was immense, but counter-productive. With public debt
growing fast, households and entrepreneurs became pessimistic about
the future of the country. This pulled private spending down.
Besides, risk premiums rose to the same level as in Italy, which had
a tradition of excessively loose fiscal policy. This is a warning
that cheap financing of radically increased budget deficits should
not be taken for granted. The current crisis has taught consumers in
many countries that there are limits to their debt. Do we want to
learn this lesson in relation to the public debt as well?
A large fiscal stimulus may also turn out to have a negative impact
on financial intermediation. Financial turbulence generates the risk
of a credit crunch. How to mitigate this danger is a major worry of
many governments. One of the reasons banks are reluctant to lend is
they have insufficient capital. According to the International
Monetary Fund’s recent “Global Financial Stability Report,” banks
need globally almost $700bn (€540bn, £474bn) of additional capital. A
simultaneous large borrowing by governments to finance their fiscal
stimulus could make it more difficult for banks to gain access to
global capital markets and possibly limit any increases in their
capital and lending. The ability of the emerging economies to finance
their growth will also be affected. Large fiscal stimulus by
developed economies could deepen a credit crunch in the less
developed one.
One thing is sure: a large fiscal stimulus would increase public
indebtedness and impose a burden on future growth. Big increases in
public investments are likely to be wasteful, as it is not possible
to have a long backlog of well-prepared projects. In addition,
political pressures might dominate considerations. A large increase
in spending may also raise the possibility of corruption. A fiscal
stimulus that temporarily lowers indirect taxes at the cost of future
increases in marginal income taxes (for example, in the UK) does not
improve incentives to work, invest and innovate.
The effects of large fiscal stimulus in most countries are likely to
be disappointing, while the longer time impact would be negative. The
financial crisis is blamed on, among other things, deficient risk
management. The proposals for a large fiscal stimulus suffer from the
same weakness.
---------------------------------------------------
Leszek Balcerowicz, a former finance minister, deputy prime minister
and central bank president in Poland, is head of the international
and comparative studies department at the Warsaw School of Economics.
Andrzej Rzonca is an adjunct professor of economics at the Warsaw
School of Economics and the chief economist in the FOR Foundation
========================
SPECTATOR 11.12.08
Politics - FRASER NELSON
Fraser Nelson reviews the week in politics
Before a country has to beg the IMF for a bail-out, there are
normally several clear warning signs. Its national debt needs to be
vast — say, several times its entire economic output. Next, it
becomes dependent on that debt, as its government is unable to
balance a budget. Then, the downfall: its currency starts to devalue
rapidly, as the world begins to doubt whether this debt will be
repaid. The premiums to insure it against default start to soar. The
risk premiums demanded by creditors become simply unaffordable. And
then: pop.
It is still highly unlikely that Britain will go to the IMF, but the
highly unlikely has been happening rather a lot recently. Monday’s
newspapers had a full-page advertisement from a high-street bank
[HSBC since you ask! -cs] boasting about its ‘global vision and
prudent long-term strategy’. Seeing Gordon Brown’s leaden economic
clichés used to sell mortgages is an almost Orwellian sign of a new
economic order. Lord Mandelson, who railed against state bail-outs as
a European commissioner, is making an actual list of companies he
considers worth saving.
To judge by the newspaper headlines — the latest being an offer to
pay sacked middle-class workers to study for MBAs — one can labour
under the misapprehension that Mr Brown has stumbled across a cash
geyser. There seems to be no end to the money flowing from the
Treasury at the PM’s behest. Yet if the government is bailing out
companies, banks and mortgage holders, who is bailing out the
government? There is no clear answer to this, and it lies at the
heart of the biggest single peril the Prime Minister now faces.
========================
POLITICS HOME 11.12.08
========================
POLITICS HOME - Comment
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=
Sky News at 08:26
Balls: Germany will join international consensus
Ed Balls, Schools Secretary
Mr Balls said the attack on the government's economic strategy by the
German finance minister was prompted by "internal politics" and he
predicted the country would eventually join the international
consensus alongside the UK.
"I have known him for many years. He always had strong and robust
views but this says more about the current state of coalition
politics in Germany. When that is resolved you will find Germany
joining the consensus around the world.
"The Conservatives are the only people in the whole of the world
standing out against this. They are out of step with the times."
[It is not just the Germans who think that Brown’s policy of the
hugely expensive and totally ineffective VAT cuts is crazy. No other
country is doing anything so silly and the French have been equally
critical -cs]
Asked about the Prime Minister's "saving the world" slip, Mr Balls
said: "The Prime Minister did not mean to say that but the UK is
leading the world. We need to save the world from a deeper downturn."
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=
Sky News at 12:39
Cameron: German finance minister was saying what we're saying
David Cameron, Conservative leader
Mr Cameron said that the criticisms of Britain's handling of the
economic crisis by the German finance minister mirror those made by
the Conservative party.
"What the German finance minister was saying is what we're saying.
This enormous binge of borrowing is going to make the recession worse
and the recovery more difficult. That’s why we’ve got to stop it."
=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=-=
“The more substantial point is that Steinbruck and his colleagues are
really pretty fed up about being lectured by Gordon Brown on how to
run their economy,” he said.
He added: “The German Social Democrats have long being telling the
British that the City of London and the sort of greed and
irresponsibility that took place in the financial market was
potentially very unstable”.
“Gordon Brown took the credit and lectured the Germans and they are
getting their own back in a serious way.”
Posts
