The UK Chancellor, him of the somewhat odd eyebrows, announced last November that he forecast a contraction of 1.5% in the UK economy during 2009. If you recall it was during this time that billions were being pumped into the financial system to try to avert the worst of what is here and what is coming. The latest from Gordon Brown is that Britain could suffer a longer and deeper recession than has been officially acknowledged, so no real surprise there. Recent reports have cast doubt on the Treasury’s forecast that Britain will start to recover in the second half of the year, so no real surprise there either. Brown defended his efforts to date, insisting (well he does do a lot of insisting doesn’t he) that it was too soon to assess the impact of the bank bailout and tax cuts announced in the autumn of last year. When asked whether the ‘downturn’ (how sweetly put) could last for two years he responded “I think that depends on the level of international co-operation” Righty ho Gordon, whatever. Then during a second interview when pressed again over this timescale he enigmatically responded with, “If we spend a pound in Britain, it can have twice the effect if other countries are doing the same. So we are trying… to get other countries to work with us”. Now I am no politician, so far be it for me to judge what makes a reputation in those circles, but in my background if you wanted people to work with you, then it really required some kind of reputation of good standing, apart from which…what did he mean exactly? Does he really know himself? I harbour grave doubts.
His latest words of wisdom, which had me almost crying in my cups, included the claim that 100,000 jobs would be created by fast tracking public spending. He added that only a small fraction of an £18 billion boost for the economy had been spent. “If we have spent £1 billion of a total of £18 billion, some on public works, some on keeping people in their jobs, some on environmental and green projects, some on helping more people go to university and college . . . we have just started”. Brown omitted to say that £12.5bn of his supposed £18bn fiscal boost will be the tax revenue lost during the next year as a result of his totally pointless cut in VAT. Mind you, I did appreciate the 17 pence VAT discount on the cost of some rawplugs I bought the other day, I shall try not to spend it all at once. Regarding that it was too soon to conclude that his £37 billion bank rescue had failed, he also said, “I do not think you can judge the success of recapitalisation by what happened in one month.” No Gordon, indeed you cannot. Is a record over 11 years enough perchance?
The more this situation develops, the more one wonders how these intellectual lightweights ever got to where they are.
Without a hint of irony, in December, the UK Government announced an ‘Independent Review into British Offshore Financial centres.’ I say without a hint of irony as they must have surely had their tongues firmly implanted in their cheeks when they wrote the objectives. I quote “the review will look at the immediate and long-term challenges facing British offshore financial centres in the current economic climate, including:” ’financial supervision and transparency’. This, from a Government who are being likened to having run a huge ponzi scheme for the last 11 years. They move on to the second objective which reads ‘taxation, in relation to financial stability, sustainability and future competitiveness’. Well they would know about financial stability and sustainability wouldn’t they, the record is there for all to see. Next up they write and this is them being serious in December you understand, ‘financial crisis management and resolution arrangements’. The sheer audacity of that objective leaves one breathless, talk about making the rules up as you go along. Then finally they place ‘international cooperation’ as an objective. At this point I can only refer you to the first paragraph.
Welcoming the launch of the review, the Financial Services Secretary, Paul Myners, said:”…Offshore financial centres must play a responsible role in the global financial system..." That would be the same role HMG have played over the last few years would it?
We live in hope. However, what we live in hope for is anyones guess these days.
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