It was classic Brown and vintage Mandelson. The TV pictures were great, the endorsements of other leaders fulsome, but there is little chance the UK government will do what it says.
It was the biggest cover story for ailing public finances in our history. The one certainty is we are a bit more in debt , all of us, as a result, thanks to the large bill for the summit. Every penny cost of what they ate and of the police overtime is borrowed. And now we have to stump up more borrowed money for the IMF.
Let’s just look at the promises and the likely results:
1. “We will put in place credible exit stategies for long term fiscal sustainability and price stability”. When? I presume that does not apply to the UK, which is going in for a borrowing binge and more inflation. They can’t even tell me if there is any prudential limit to their borrowing!
2. “We will build a stronger more globally consistent supervisory and regulatory structure”. When? How will that work? Is a global regulator about to tell the UK government it is borrowing too much and must stop? I doubt it. Is a global regulator about to force RBS to get into sensible financial shape? Don’t hold your breath, of course not.
3. They plan a “Financial Stability Board to warn of macroeconomic and financial risks”. They need one today to tell the UK government it is is risking too much by buying so many bad banks and putting them onto the taxpayer. I don’t expect it to happen soon.
4. They will take account of “macro prudential risks”. The biggest currently is the artificial government bond bubble being created by both the US and UK authorities. Why is no one in authority warning of this? Why is a government bond asset bubble a good thing, whereas a private sector property asset bubble has to be punctured by monetary action? (Rhetorical question!)
5. They will extend regulation to “systematically important hedge funds”. The only one which matters now is the enormous hedge fund the US authorities are setting up to buy toxic debt with massive gearing. They are unlikely to stop that.
6. “Tough new principles on pay and compensation”. How does that work? I don’t suppose it will get British taxpayers our money back from Fred’s pension. They will still go on paying six figure salaries and mega bonuses to employees of loss making nationalised banks. It’s all just words, playing to the gallery.
7. They will “prevent excessive leverage”. Has anyone told Mr Darling? I bet they don’t stop him leveraging the British taxpayer to new heights of indebtedness.
8. They have demanded much more transparency. Don’t expect an honest UK government balance sheet before an election, and don’t expect them to confess the full extent of their off balance sheet liabilities or of their pensions black holes.
April 3, 2009
Brown has a decade of form here. HIs budgets were always say one thing for the headlines but actually not at all the same when you read the small print.
He’s made a rod for his own back here as Cameron and Osborne can keep asking him about delivery of his G20 promises every week between now and the election.
April 3, 2009
Re-announcing the same things and calling them new. Brown being called “global leader” etc etc. All very good, now expect a vote grabbing budget followed quickly by a General Election.
I hope team Cameron are ready for the onslaught?
April 3, 2009
It’s not just that – the police violence at the protests was (unacceptable-ed).
The Economist had a journalist present and people are commenting on the article he wrote; this from someone who participated in the protest;
(Details of an incident given which would require a witness statement and report alleging police violence – ed); This was repeated throughout the day.
And you know as well as I nothing is going to happen about this. And we ourselves are going to do nothing about this – what can we do? – and our inaction is properly tantamount to our *acceptence*, of this violence and injustice – and it is that which makes us all so damn miserable. And we try to put it out of our minds, that we’re going to do nothing.
Our perforce acceptence of this injustice makes us *miserable*, just as our perforce acceptence of the blatant mismanagement of our country makes us miserable.
The real cost of Government failure is *happiness*. We are not content, satisfied or joyful. We are depressed, sad and feel helpless and because of this we try to put these things out of our minds. It’s our LIVES which are being decimated by all this.
Reply: I see video footage of an incident is now the subject of independent investigation and controversy.
April 3, 2009
US$1.1 trillion is a lot of money… where is it going to come from? Does any of it actually exist, or are we being treated to some more smoke and mirrors? If it is illusory, isn’t this precisely the sort of behaviour that started the problem in the first place? This is all getting so Alice in Wonderland I’m beginning to have some sympathy with the press, who appear to have given up trying to understand/explain any of it and just print what Lord Mandelson tells them.
April 3, 2009
The whole publicity “spectacle” of this G20 meeting was quite nauseating. Politicians manipulating the media and playing their own selfish games. As for there being a proper detailed plan for Brown’s “New World Order” (an expression normally used by conspiracy theorists) we have yet to see. Maybe the Sunday papers will project a better informed and more objective analysis.
April 3, 2009
Think of the government as hostages to those who control the broken financial institutions, an international gang who admit to no laws or controls. The way the government are trying to get out of the situation is by selling to the gang all our futures.
April 3, 2009
O/T perhaps, but while Gordon has been busy playing āchancellor of the worldā², itās been business as usual at home for New Labour and its client in the quangocracy, namely massive incompetence and squandering taxpayers money by the shedload.
Earlier this week a report published by Andrew Foster, formerly head of the Audit Commission, confirmed that the incompetence of Britainās biggest quango, the Learning and Skills Council, has left FE colleges up and down the country facing financial ruin -some with premises half built- by blowing the entire funding set aside for the governmentās for 2.3 billion pound THREE year college rebuilding programme in just NINE months.
Apparently, the LSC didnāt keep a running total of how much they had been approving from the rebuilding budget and didnāt realise there was no money left in the kitty until it was too late. How moronic is that!!!!
Naturally, the head honcho has already left with a large taxpayer funded payoff.
Meanwhile, the ministers involved, John Denham and Sion Simon, are busy passing the buck too although Fosterās report clearly identifies DIUS officials as being directly involved in this shambles. It is understood that Ministers are currently in desperate talks with the Treasury trying to sort a fix.
You couldnāt make it up.
New Labour = financial incompetence. If they can’t manage straightforward financial issues at this level they how can we trust Brown and his government to the fix the economic challenges facing the country as a whole.
http://www.telegraph.co.uk/education/educationnews/5089709/College-building-blunders-were-predictable-and-avoidable-finds-inquiry.html
http://www.guardian.co.uk/education/2009/apr/01/college-building-management-failure
http://www.dius.gov.uk/news_and_speeches/announcements/~/media/pubs/L/LSC_Capital_Review_acc
April 3, 2009
Now the G20 has backed mortgaging the real assets of its children and grandchildren and stoked inflation to destroy the savings of its people. All this is morally indefensible. Pity these greedy immoral people cannot be subjected to proceedings in the International Court of Human Rights. Do they not have a duty of care of our childen and grandchildren; not to mention of our savings.
April 3, 2009
I am very pleased to note that your blog posts are sounding crosser and crosser. Welcome to the club.
April 3, 2009
They have finaly sold out the people “taxpayers”, the tax payers will fund the IMF, the IMF then have the funds to bail out goverments. The goverments in turn use the tax payers to pay back the money that they had to pay in the first place.
All the while the central banks continue to make money and their reprasentatives still gain their huge bonues. We were set up, and it stinks to high heaven.
April 3, 2009
What are the causes of this crisis for us Brits?
Surely they must be the fact that China is running a (low wage-ed) economy which is slowly putting our own (better paid ed) workers out of a job? Most of our stuff – clothes – electrics – toys – recycling – sports – seem to be done in China now. So they are getting richer.
Meanwhile, British workers who work for a fair day’s pay and decent conditions are being priced out of the market. Our GDP is falling like a stone.
And the EU is not being helpful. For a start there are all sorts of Welfare Provisions for any European who happens to take a ride to this country. Then the EU is placing enormous restrictions on our workforce day by day. Now it wants more and more regulatory box ticking by foreigners – sorry our fellow European Citizens. And our little country is broke.
That is why most of our citizens are hanging on the state payroll to a ridiculous degree.
I wonder if anyone actually mentioned all this? It doesn’t seem to be in the platitudes above.
April 3, 2009
The conspiracy theories are true. We now live in a “New World Order”.
April 3, 2009
Mr Redwood makes some sensible points here but I was hoping he would counter the more general attack made on Anglo-Saxon deregulation made by Merkel and Sarkozy.As shadow spokesman for deregulation under ,I believe, Michael Howard,he would be well- placed to tackle this apparent difference of political philosphy.
April 3, 2009
The sad thing is – people are falling for it!
I’ve heard people talking about the recession being “all but over”. House prices are rising again. The G20 has come up with solutions. “All this money,” I have heard people say, “Is starting to get things moving again.”
It’s crazy. Even if the monopoly currency were to start some business and borrowing again, it’s only a very very brief stopgap before the whole thing comes crashing down even more loudly than before.
My money is still on a flash election after a giveaway budget. Gordon must realise its his only chance before the smoke and mirrors are revealed.