Taxpayers will carry burden for years (From Middlewich Guardian)

Taxpayers will carry burden for years

12:28pm Wednesday 3rd February 2010

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PERHAPS I can comment on Alan Lowe’s assessment of global and national economics – an assessment which appears to be driven by his desire to see the present government in a rather pinkish hue.

Does he seriously believe that all the world’s different banks quite suddenly and with independent thought undertook what is now perceived as reckless lending?

Whereas the credit crisis actually manifested itself in the banking sector, the birth of the crisis was political.

In the later 1990s, there was a G20 meeting, presumably involving Gordon Brown, which concluded that world growth was stalling and needed a stimulus. The finance leaders agreed that the way forward would be to give growth a kick-start by extending credit.

As a consequence, on return to their own countries their respective banking sectors were given strong political encouragement to extend credit availability.

The rest, as they say, is history.

Subsequently, the only thing the politicians agreed on was that the banks should take the total blame.

And yes Alan, others did disagree with Gordon Brown’s recovery policy. Which probably explains why this country was the last to come out of recession.

Some would say that the stock market has risen despite his policy or would have risen faster with a different one. Incidentally the high point of the market is not 6400, as your arithmetic would suggest, but in fact in excess of 6900.

Finally Alan, what makes you think that a temporary stable pound at a level just above its lowest point ever is such a good thing.

Whether or not the pound will crash further as the consequences of Brown’s profligate spending and borrowing policies remains to be seen.

What is certain is that the taxpayers of this country will be carrying the burden of those policies for years to come.

DON MICKLEWRIGHT Weaverham

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