George Osborne yesterday told Eurozone leaders that Britain would not contribute to a special bailout facility that they are establishing at the IMF, specifically to bolster the single currency. The Eurozone nations had been hoping to build a €200bn warchest but Britain’s refusal to participate means it has fallen well short.
via Now it’s Osborne’s turn to say “no” to Europe The Tory Diary. My recent IMF speech is here.
A good speech from George Osborne:
We should not be satisfied with turning back the clock to how things were before the crisis, or we risk simply pumping the bubble back up.
That would mean failing to understand a crucial insight that has become increasingly clear – that the model of economic growth pursued over the last ten years is fundamentally broken.
We can no longer rely on cheap borrowing from China and the rest of Asia to fund our standard of living.
The drivers of change we have depended on – housing, banking and rising Government consumption – cannot be relied upon to drive growth in the decades ahead.
In short, you cannot build lasting prosperity on a mountain of debt.
via The Conservative Party | News | Speeches | George Osborne: A New British Economic Model .
George Osborne has stressed that Britain needs to move from an economy built on debt to one “powered by savings and real returns on effort”.
…
“With reform we can not only live within our means, we can start to tackle Britain’s long standing social problems of welfare dependency, educational under-achievement, crime and persistent poverty. And we can begin to bring the national debt under control.”
via The Conservative Party | News | News | A different vision for our economy . Full text of the speech here.
From conservatives.com:
George Osborne said the Pre-Budget Report represents “the greatest failure of public policy for a generation” after Alistair Darling announced plans to double the national debt to more than £1 trillion.
George, the Shadow Chancellor, described the report as a “Tax Bombshell Budget” and stressed that a debt of £1 trillion was “the bill for Labour’s decade of irresponsibility”.
“It is confirmation of the time-old truth that, in the end, all Labour chancellors run out of money and all Labour governments bring this country to the verge of bankruptcy.”
Bloggers and commentators are congratulating George Osborne on his response and pointing out little details like the £40bn of tax increases which outweigh the £20bn stimulus package. (And yet still we find record borrowing will be achieved.)
Watching BBC Parliament, the oafish smugness of the Labour front bench was almost unbearable. Here they are most likely ruining us but they are pleased with themselves. The Chancellor was particularly self-congratulatory as he compared the cost of borrowing now to the cost in 1997, but he forgets, or fails to understand, the market mechanisms by which British interest rates will be forced to rise sharply if the Government is to continue selling its bonds.
Was this a political pre-budget report? Oh yes. They hope to get away with maintaining their burdensome quango state at our ever-greater expense, by reducing taxes marginally before the election, only to boost them afterwards.
George Osborne’s message today was realistic and hopeful, full of promise, not just on the economy, but as a philosophy to renew Britain:
Before us lies a tough task.
Before us lie difficult decisions.
We have shown the courage to face up to those in government before and we will show the same courage again.
But I want to tell you something else.
I want to tell you what makes our Party great.
In this Conservative Party, we are optimists who never stop being realists.
We are revolutionaries who never stop being pragmatic.
We dare to dream but never run away from the day to day.
We are idealists who never have our head in the sand.
Be in no doubt.
A hard road lies ahead of us.
But that hard road leads over the horizon.
Video of the ending and backstage remarks here:
Under Labour, 900,000 more people are in deep poverty compared to 1997 and the gap in life expectancy is now the highest since the Victorian age. A person on £100 a week takes home just 6p for every additional pound earned. Government borrowing will burden generations.
