The Great Debate UK

from UK News:

A profound shift in party politics

David Cameron's decision to ditch a major Conservative pledge to match Labour spending plans pound for pound was hailed by commentators as an important step in the politics of the recession, opening up a clear gulf between the two main parties' economic policies but exposing the Tories to considerable risk.

Labour is expected to cut taxes, accelerate public spending and announce more borrowing in Monday's pre-budget report. Now their supporters can revive the spectre of "Tory cuts" to funding for schools and hospitals which helped the Conservatives lose the last two elections.

For many of the newspapers, this is all part of a game being forced on the Tories by Gordon Brown's rapid resurgence in the polls thanks to the economic crisis. A Mori poll this week found the once-mighty 26-point Conservative lead has slumped to just three points -- equivalent to a Commons majority of four seats.

"In the extraordinary game of chess that is being played out against the backdrop of the recession, Cameron had no choice," wrote The Independent. "But there are big risks for the Tories. Most non-partisan economists recognise the case for higher borrowing to pay for a fiscal stimulus. The Conservatives are virtually on their own in claiming spending cuts are an immediate answer.

from The Great Debate:

New economies want power before paying

Paul Taylor Great Debate--Paul Taylor is a Reuters columnist, the views expressed are his own--

Anyone who expected the major emerging economies to write fat checks in exchange for being invited to the first G20 leaders' summit on rescuing the world economy will have been disappointed.

But that should only have surprised the naive.

Despite intensive lobbying by British Prime Minister Gordon Brown of Saudi Arabia and China, the rising powers were never likely to make a cash down-payment to the International Monetary Fund before getting more seats and votes at the top table.

from The Great Debate:

Petrodollar drought another blow to banks

James Saft Great Debate -- James Saft is a Reuters columnist. The opinions expressed are his own --

Banks in Europe and Britain, and their unfortunate would-be borrowers, face another blow as plunging oil prices tighten the spigot of petrodollar deposits.

Billions of dollars worth of funds from oil exporting nations have made their way into banks from Zurich to London in recent years. These inflows helped banks withstand credit crisis losses and, given much of the money was in dollars, was a source of dollar liquidity during recent money market difficulties.

from The Great Debate:

Reinforcing what? The EU’s role in Eastern Congo

Neil Campbell, EU Advocacy Manager of the International Crisis Group, recently returned from eastern Congo. Any views expressed are his own.

Neil Campbell“Unacceptable and murderous.” Those were the words French Foreign Minister Bernard Kouchner chose to describe the situation in north eastern Congo at a press conference after October’s monthly meeting of EU foreign ministers. Sadly, Congo was not even on the agenda of that meeting.

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