Thursday, March 12, 2009
In the Land of the Blind who is King?
1. We learnt from The Guardian yesterday that a split is emerging between the US and Europe over fiscal stimuli: how much and how administered. Europe favours smaller injections it would seem than UK and US.
2. The US Treasury team do not yet seem to be in place; the product of their system whereby incoming administrations appoint their own people. Not like our permanent civil service types who serve whoever is elected. Sir Gus O'Donnell recently said 'There is nobody there' of his dealings with the US Treasury.
3. So far, nobody knows if any of this injection of huge funds is actually working. We are all still very much in the dark, where the blind are trying to lead ther blind.
But here's a comforting thought for Gordon; in such a world, the land of the blind, who is said to be king? The one eyed man. Well, he must be the only one eyed national leader among the G20 crowd.
Think you're right- a momentary lapase of good taste in humour, to which I am occsasionally unfortunately prone.
Don't agree at all that Steph Flanders is brilliant. Never really rated her on Newsnight; Paul Mason is much better.
On your points:
1. The UK government is perhaps the most vocal advocate of fiscal stimulus, but reality is out of step. More money might be made available in April's budget, but it would be odd to wait until then. In contrast, Germany's fiscal stimulus amounts to over 3% of GDP. [Though it's true that the UK has a more activist monetary policy than the eurozone.]
3. Very little of the planned US fiscal stimulus has actually been spent yet, so effects won't be seen for sometime. A lot of criticism has been levied at the UK's temporary VAT cut, but again it's far too early to tell.
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