Whilst the PM says he will support any financial package in Washington before knowing the detail, back at home there is another reminder of that part of the Credit Crunch which is made in Britain. Talk on the BBC suggests some people are seriously considering another nationalisation.
Please give us a break. Taxpayers cannot afford the last bank they bought for us, and we certainly don’t want to go collecting them. Under EU rules any newly nationalised bank would have to stop new lending to avoid offering subsidised competition. It is bad enough to have lost Northern Rock’s lending to the market, without losing another one.
Nationalising is the worst option. It means sacking more staff, running down the business and sending taxpayers a large bill for all the losses. It means fewer mortgages, lower house prices, and more uncovered lending. It means deepening the crisis. It means debauching the government accounts. By all means strengthen deposit protection. By all means act behind the scenes to help a private sector solution, but do not promise to buy it or take it over.