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Monday 28 November 2011

Verity Murphy | 13:49 UK time, Monday, 28 November 2011

The OECD has warned that the UK could be entering a recession, predicting a 0.03% contraction this quarter, and a further 0.15% next, and has warned that a further deterioration in the UK economy could require changes in policy.

The prediction comes a day before Chancellor George Osborne unveils his "mini budget" Autumn Statement.

Tonight David Grossman reports on what we have already learned about the statement in the briefings of the last few days and what else the chancellor may have up his sleeve.

Plus Paul Mason has been in the North West, still the country's industrial heartland, looking at what can be done to boost growth and to switch the economy from one dominated by consumption to one led by export.

And Jeremy Paxman has an interview with General Martin Dempsey, the US' new Chairman of the Joint Chiefs of Staff.

When he was nominated Gen Dempsey was described by President Barack Obama as one of America's most "combat-tested generals", but his biggest challenge may be more prosaic - establishing priorities for cutting the defence budget, which consumes around 20% of the federal budget.

Mark Urban will be looking at which areas could be in the cross hairs.

Plus, Tim Whewell reports from Cairo where Egyptians are voting in the first election since President Hosni Mubarak was toppled in February.

Comments

  • Comment number 1.

    If the reaction of the FTSE today is anything to go by it would appear that Osborne's alleged growth project is little more than a dash for the further extension of an NHS style PFI welfare state for the stock market parasites. Any excuse to rip-off the British taxpayer and privatise our public infastructure by stealth, yet more massive wealth transfer to the mega rich from everyone else and especially those on low incomes !

  • Comment number 2.

    "Plus Paul Mason has been in the North West, still the country's industrial heartland, looking at what can be done to boost growth and to switch the economy from one dominated by consumption to one led by export."

    The North West the country's industrial heartland - don't make me laugh!

    For a start the West Midlands and the Black Country was the the country's industrial heartland...and that heart was ripped out years ago.

    I suppose we still have the defence industry exporting killing machines to anyone with a large enough cheque-book (usually US client regimes installed by the CIA for you know who). Isn't odd how we seem to be able to equip the RotW's armies adequately, but not our own.

    Oh and of course there's X-Factor, 'we' seem to have managed to export that to around half the World...now just where did all the profits from that go to????

  • Comment number 3.

    BAND AID

    “0.03% contraction predicted this quarter.” Phew. I was worried it might be 0.04%

    WHAT IS THE ERROR BAND? NewsyNighty is awash with financial pundits and guru. Why no mention? Is it like mentioning the war?

    Words fail me . . .

  • Comment number 4.

    Looking forward to Paul's piece.

    Could we please take the OBR, IMF, OECD, CBI etc to task over their ludicrous predictions and support for the austerity plan?

    It is quite obvious and basic economics to realise that engaging in massively deflationary policies in taxation & spending would....deflate the economy!!!

    I have banged on for 18 months about the TRILLION POUNDS of aggregate demand that was being sacrificed by taking £112 Bn out of the domestic economy, with no realistic prospect of export demand replacing this - then add in the further massive reduction in aggregate demand from cutting wages in real terms and the very inflationary effect on import prices from the effective 30% devaluation in Sterling further depressing aggregate demand and you end up precisely where we now are.

    if I predicted this accurately 18 months ago on NN blogs without rooms full of computers and Economics PHDs, why has it taken the OBR/OECD etc four bites at the cherry to get anywhere near an accurate forecast?

    Libertarians may be ideologically opposed to Keynesian policies, but IMHO there appears to be a denial of reality going on here about the impact on demand of austerity measures which gets close to deception, when it is plain as a pikestaff that the only possible outcome from austerity would be the need to borrow an additional £10 Bn or more to fund the gap caused by lower tax receipts and higher welfare costs, plus a million more out of work and flatline growth heading for recession.

    One thing is now clear - there is a deep, structural problem with the UK private sector - particularly manufacturing - which does not respond to things like devaluation and seems to suffer from a complete inability to compete with China, etc.

    We either address this via industrial & trade policies, or we reconcile ourselves to ever falling standards of living, rising unemployment and mounting personal and national indebtedness.

    Under Sir Alan Budd's leadership the OBR published its first report on Osborne's budget which suggested the UK would outperform even the most vibrant economies in the world and deliver £400 Bn of new investment in industry, exports up by a third and 2.4 million new NET jobs, as well as replacing those going in the public sector.

    When we look back at this today with the benefit of hindsight, you can only conclude that either Budd's judgement was deeply flawed; that the Coalition has departed from the script or that this was a deliberate politically motivated snow job.

    The only excuse there could be

  • Comment number 5.

    So Migrationwatch have been proved right with their mass immigration estimates, that were derided by all and sundry, namely the Guardian.

    http://www.migrationwatchuk.org/

  • Comment number 6.

    COMBAT-TESTED GENERAL

    Now all they need is an INTEGRITY-TESTED PRESIDENT.

    Yes they could!

  • Comment number 7.

    Continued

    The only excuse there could be is no doubt based on the EuroLand crisis, but if you look at the figures, our trade with the EU actually held up during most of the last year, so there is no fig leaf for the OBR to hide behind there.

    Mr Choate is now the incumbent @ the OBR - the question is, will he live up to his reputation and tell the truth about the UK's real prospects? If he does, George Osborne's plan to create an independent asessment of economic policy will become a frankenstein monster for the Coalition, if their creation becomes the instrument of their own destruction.

  • Comment number 8.

    The government's policies were misguided from the start, if you believe their stated aims, and not that they were using the crisis to indulge in class warfare.

    It can't be said that they weren't warned by the foremost minds in the field.

    http://falseeconomy.org.uk/cure/what-do-the-experts-say

    My friend Prof K sticks his knife into the OECD today: "how did we get here? In large part, by listening to people like … the OECD, which demanded both fiscal austerity and interest rate hikes back in early 2010. And yes, it was the same people now running scared of the consequences of those spending cuts and rate hikes."

    http://krugman.blogs.nytimes.com/2011/11/28/oh-ecd/

    Also a very interesting blog about the country George Osborne said we should emulate:

    http://krugman.blogs.nytimes.com/2011/11/27/hedge-fund-ireland/

  • Comment number 9.

    A. Darling Esq. said earlier this year that in run up to last general election - Labour had no credible economic policy - so Osborne hardly needs any advice from one E-Balls Esq on how to run the UK economy.

    ConDems focus on cutting defict is absolutely 100% right thing to do as without lowest possible borrowing costs (even a 1-2% increase could put UK before IMF with a begging bowl) - Chancellor Oz has no chance of stopping UK economy spiralling out of control into bankcruptcy.

    Infrastructure financed by UK pension funds - is very good in principle as is British investment & British focus - Con Dems can build on this with further tax initiatives for UK business/investors.

    GO missed opportunity in march 2011 budget to slash overall VAT rate but needs careful management to be successful as delivering a British added value focus to UK production, services and consumption but may be probited by EU straightjacket.

    UK cannot recover with VAT at 20% it is insane to have any tax on consumer spending when that is exactly what UK economy needs. VAT has to be funded elsewhere out of £700 bn uk govt annual spending - some ideas here:

    1) stop bombing around the world?
    2) stop subsidising immigrants to steal our UK jobs with e.g. free health service & give away NI numbers & passports?
    3) have UK gren energy plan for self sufficicinecy and electrification of transport target (say 90% by 2030)

    Plenty can be done but successive govt's lack vision, planning, strategy - just about everything really.

    One last word on VAT cut - needs to be senstively done so that supply chain spivs don't pocket all VAT reduction advantage - so VAT might need to be retained or even increased on certain imports to stimulate doemstic market & margins. VAT cuts needs to be done tomorrow or in March budget otherwise some might hold off on Christmas spending waiting for a VAT cut - but is Osborne likley to 'manage VAT' - probably not and that may well seal his fate?

    The Free Market ideology has failed our Anglo-Saxon economy and Chancellor needs to be bold & radical & stimulate domestic aggregate supply & demand as domestic demand only stimulus just sucks in more imports which is inflationery.

    We/UK govt needs a few good brains in there to manage all of this - but we know very little is going to happen here - ConDems/Osborne are trapped in Conservative mantra globalist, free market rhetoric which has done & is doing so much damage to UK economy & British living standards & is sending the UK the way of Greece, Italy, Spain & Ireland etc., in all but timing as this current debt/EU crisis is medium/long term.

    Outlook v confidence twaddle - if Osborne can do something to improve UK economic outlook as pulling UK purse strings; then the confidence rhetoric might make some sense?

  • Comment number 10.

    Can I ask a question - why is it whenever the BBC News 24 covers a story about Government policy the first person they always seem to interview appears to be Ed Balls?

    I would write more but I have to go and work over-time so that I can pay more taxes so that public sectors will have a bigger pension than me.

  • Comment number 11.

    Whatever George Osborne says tomorrow, there is one certainty -he will gloss over the fact that his remit for infrastructure projects extends to England only.

    If only the vast majority of politically disinterested English people could understand that this island is anything but a politically United Kingdom.

  • Comment number 12.

    richard bunning wrote: "One thing is now clear - there is a deep, structural problem with the UK private sector - particularly manufacturing - which does not respond to things like devaluation and seems to suffer from a complete inability to compete with China, etc.

    We either address this via industrial & trade policies, or we reconcile ourselves to ever falling standards of living, rising unemployment and mounting personal and national indebtedness."

    True. But the Chinese have literally been breeding more and more able people than we have. They place their graduates where the state (everyone) needs them, which also means that they are more likely to meet suitable mates and produce more able people. This is all left to dysgenic chance here.

    This is obviously true looking at the OECD/PISA data, yet nobody dares openly discuss it here. UNESCO take spot shots at China's eugenics but it is sotto voce elsewhere.

    Talking about reality is not bad behaviour - it's just that most of our politicians and our "well educated" people still behave like arrested developed school kids and have little or no real world experience. They just want limelight, popularity, fame and fortune. Hookers can get that.

  • Comment number 13.

  • Comment number 14.

    All Mervyn King's horses, and all Osborne's men, can't put growth back in the economy again.

    Without a proper understanding of how absolute economic growth comes about then we will just be subjected to a barage of futile tinkering and banter by the myopic establishment. Cheap energy (namely fossil fuels) is the prime source of economic productivity. Science has known this for more than 40 years:

    http://forensicstatistician.wordpress.com/2011/05/27/is-economics-a-real-science/

    Our leaders have learned nothing from the financial crisis three years ago (and how it would inevitably engulf sovereign balance sheets), and seemingly will learn nothing from the inevitable failure of their "pro-growth" policies.

    Alas, the first casualty of economic failure will be the truth.

    Seems we still have some way to go before we reach "peak ignorance".

  • Comment number 15.

    tawse57 wrote "I would write more but I have to go and work over-time so that I can pay more taxes so that public sectors will have a bigger pension than me."

    Do you want Private Sector healthcare, education, police, prisons etc where you pay insurance companies for all that and more? In other words, do you want to live in the USA? That appears to be the way this country and the rest of Europe and the OECD is being taken as the BRICS and SCO is going in the opposite direction. Which do you think is going to win given the PISA/OECD data and the birth rate data. Just look at the data, nothing else.

    PS Look up Oppositional Defiance.

  • Comment number 16.

    9, Sorry, I though I'd spell checked previous - spelling mistakes are awful

    Never mind, worse things happen in the UK economy & Europe

  • Comment number 17.

    Nick and Dave we're all in this together....except you.
    http://www.youtube.com/watch?v=uATUAqXFR6E

  • Comment number 18.

    14.At 18:00 28th Nov 2011, Hawkeye_Pierce wrote:

    Speaking as one with an Economics Degree - Economics is a 'behavioural science' - 'outcomes' depend on 'behaviour'.

    Since like many other economists, I believe that there isn't any 'scientist' who can explain 'behaviour' from the examination of graphs - your web link appears to be a bit tongue in cheek - statistics is an element of economics - but like politicians and bankers - many statisticians think they're automatically to be regarded as 'economics experts'

    I wonder what qualifications are needed to be a 'banker'? Lecturing all and sundry on 'economics'? Money is not the same as 'economics' although the two are, most obviously, closely related.

    A 'politician' - What qualifications do politicians have that catapults them into making the most important economic decisions?

    What our economy needs is more 'economists' in the right places and less spin-meister, vested interest spivs & economic commentators - as the lack of real economic input at a strategic level is very evident in failed economies like the UK - where economics is driven by ideology, rhetoric, arrogance, greed & politics.

    It frequently amuses me to find that the ones very often with the most to say on economics are not economists at all!

    The ones xxxxxxxxx up 'economics' and as generally getting 'economists' a bad name - are generally those who are not even 'economists' by their education or experience & have no formal/academic training or research quals.

    But don't worry - I won't ask you if you are an economics grad?

  • Comment number 19.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 20.

    http://www.bbc.co.uk/news/education-15918195

    As 10% of the school population is in the Private Sector is this a reference to the 90% which is in the Public Sector?

    Is it possible that Mr Gove is a mite confused, as Policy Exchange is a hotbed of radical right-wing Libertarian extremists up for confrontation with those who believe in sound governance?

    For evidence, I refer any dozing viewers/readers back to Newsnight's investigations and interviews a few years back.

    http://en.wikipedia.org/wiki/Policy_Exchange#Newsnight_investigation

    Isn't everyone just a little bit concerned that our Secretary of State for Education and colleagues are all tied up with radicals who want to destroy the state? Shouldn't the Newsnight Team tip off MI5, or might that get them a telling off from The Home Secretary with threats of "rendition" to Salford in the "Industrial heartland" (a bit like Siberia)?

  • Comment number 21.

    Warnings from the OECD are like the warnings from the Ratings Agencies in that only a few years back these agencies were part of the NGO machinery which helped bring about the Credit Crunch. The three Rating Agencies, remember, were then under a cloud for ratings they had given to CDOs etc in the build up to the Credit Crisis, and the OECD is the NGO which emerged out of the Marshall Plan which funded Libertarian free-market economies after WWII and during the Cold War

    http://www.oecd.org/document/63/0,3343,en_2649_201185_1876671_1_1_1_1,00.html

    http://articles.cnn.com/2011-08-19/opinion/franken.rating.reform_1_jeffrey-manns-credit-rating-rating-agencies?_s=PM:OPINION

    Now Europe is being bullied, and the markets are being used via the Rating Agencies and OECD top achieve a political objective. EU fiscal union which can not be achieved democratically. We saw it with the Lisbon Treaty dissenters, and we are seeing it again.

    Will we ever learn?

    Axis II Cluster B types are prone to bullying. "What Is To Be Done?"

  • Comment number 22.

    PANORAMA TONIGHT RE PFI

    JJ
    statist
    et al


    Your one person crusade is beginning to stir things up for the good!

    Hallehlulea!

  • Comment number 23.

    #3 barriesingleton wrote:

    "BAND AID

    “0.03% contraction predicted this quarter.” Phew. I was worried it might be 0.04%

    WHAT IS THE ERROR BAND? NewsyNighty is awash with financial pundits and guru. Why no mention? Is it like mentioning the war?"


    When the decimal point moved one extra place to the left the Gov't/BBC lost all credibility.

  • Comment number 24.

    #14

    An apposite and poignant post.

    How many on here will really undestand it?

  • Comment number 25.

    #24 museV

    But surely the " truth " was sacrificed a long time ago !

  • Comment number 26.

    #25

    True!

    Tom Bradbury was pretty animated on ITV news just now that Saaarkozy, Obama and Cameron can't persuade th eGermans to capitulate re the ECB.

    He actually said...'the Germans have said they know what they are doing....but the others are losing faith that they can control the markets!'

    ho,ho,ho!

    The Wizard of Oz etc etc

  • Comment number 27.

    Leveson, Leveson....another rich celeb complains that their rich private celeb life has been invaded by the press.

    Yawn, yawn, yawn!

    Wake me up when the real news is on.

  • Comment number 28.

  • Comment number 29.

  • Comment number 30.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 31.

    This economic crisis will be - for the umpteenth time of saying - only solved by trade barriers going up.

    Banksters in the City and on Wall Street celebrating Apple's 300 bucks per share because iPhones are made dirt cheat in China is only going to be stopped by trade barriers going up to stop Chinese made iPhones being imported into Europe, the UK and, yes, into the US.

    Apple is but one example.

    Trade barriers will come sooner than later. For the UK, let's hope they come before China's CIC has us in debt to them for all the new road and railways soon to be announced.

  • Comment number 32.

    Excellent interview by Jeremy with General Dempsey....who knows, we may be heading towards another war :o(

  • Comment number 33.

    "I WON'T TELL YOU THAT" - DEJA VU

    Remember the archive interview, from years back, with Hastings Banda, who answered every question with: "I won't tell you that"?

    http://www.youtube.com/watch?v=-ViNxSMoqTc

    I watched it again - Jeremy and the General.

  • Comment number 34.

    the chancellor intends to invest £30bn over 10 years in infrastructure. I find it very depressing to think that if the 'boys' in the City of London were civic-minded, they could pay for the refurbishment of a whole nation with the bonuses they earn in half that time.

  • Comment number 35.

    E-mail in response to a former colleague in Australia whom was expressing concern on the impact on the Australian economy...

    Did I miss anything in my response?



    Uk gov has now decided to invest a load of ££ in infrastructure as well in an attempt to avert a second recession. This is likely to be futile, with so much of our trade with europe any severe problems there will impact the uk severely also no matter what we do, note the existing problems have not fed fully through yet, nevermind what is around the corner. The capital projects may help soften the blow but it is unlikely to be enough and without growth returning the debts start to spiral even more out of control than they are now.



    Likely to be trouble everywhere, including Australia, but that is likely to be much less severe than here.



    At the risk of sounding melodramatic, at current global population levels and with increasing political and economic instability in many countries the outlook is not good at all and the world is likely to be entering into a dangerously unstable phase with uncertainty for everyone, an increasing number of chaotic 'failed states' with no effective government, mass migration and episodes of genocide and conflict for resources.



    In such times the best place to be to safely bring up a family is likely to be in a solidly goverened island nation with a relatively low population and self sufficiency in all resources located away from likely areas of conflict in Africa the middle east and Pakistan (poorly goverened nations with high populations and ethnic tensions with neighbours). Overpopulated paper based economies are likely to re-discover the fact that you cant eat paper or put it in your car to make it go if nobody believes the paper is worth anything in the real world (economists refer to this as 'confidence').



    I hope that puts Aussie worries into perspective.



    Have a nice day !!!!!

  • Comment number 36.

    Just watching Ed Miliband being interviewed on SKY.

    He is very statesmanlike.

    He has a clear 5-point plan.

    Can't think why it is not being adopted right away, as he clearly knows what he is talking about, and has the track record to prove it.

    At least the media are giving him and Ed Balls full, indeed near exclusive and unchallenged voice to share their wisdom.

  • Comment number 37.

    PENSION FUNDS TO BE RAIDED (AGAIN)?

    #35 Jericoa wrote:

    "Uk gov has now decided to invest a load of ££ in infrastructure as well in an attempt to avert a second recession."


    But just where is the UK gov't getting this money?

    Now from what I heard on the news yesterday, UK pension fund money (along with money from the Chinese) will be used for these multi billion pound infrastructure projects.

    Something similar happened in Argentina not so long ago...

    Argentina seizes pension funds to pay debts. Who's next?
    http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/5504137/Argentina_seizes_pension_funds_to_pay_debts_Whos_next/

    Argentine economic crisis (1999–2002)
    http://en.wikipedia.org/wiki/Argentine_economic_crisis_(1999-2002)

  • Comment number 38.

    @35 Good analysis Jericoa! Especially "Overpopulated paper based economies are likely to re-discover the fact that you cant eat paper or put it in your car to make it go....."

  • Comment number 39.

    #37

    No doubt they will be raided.

    It is worse than that as well. As an engineer whom would be involved with such projects I can report with authority that they will struggle to get them going any time soon (to a point where large numbers of jobs are created) due to the huge amount of red tape involved with any UK capital project, combined with the fact that many experienced engineers have emigrated (I will soon be one of them).

    To get them on site quickly the nation will have to be put on a war footing and a good deal of the H&S legislation binned along with a lot of the EU stuff as well on procurement and environmental / planning issues. If not we are talking 1 to 2 years before any ground is broken minimum.

    Much of the raw materials and expertise will have to be imported and quite a bit of the labour as well. The EU is already becomming a myth as a 'free trade block'under the pressure of country specific economic and consequently political woes.

    One example of this.

    I was speaking to a Scottish contractor recently and he was complaining / writing to his MP because the Scottish market is flooded with Irish contractors undercutting them as they have been given a tax break by the irish Gov so the 'locals' can not compete....on level terms anymore.

    Anyway, I will soon be observing all this from a far with my family. I have tried to actively raise awareness and change things for years now as best I can but the brick wall of existing interests has got things sewn up pretty tight. I have to think of my family now.

  • Comment number 40.

    #39 Jericoa

    Good luck in Oz!

  • Comment number 41.

    INVITATION TO AN ORGY

    Woman shown '"hurling racial abuse" on a tram. Is there any Statute entitled: "INCITING RACIAL ABUSE"? Would such a crime not find recent governments in court for perversely flooding the country with ethniks, and conniving at ghettoisation?

    Who cares: let's jump on the media/PC bandwagon; we have a hand scapegoat -

    sorted.

  • Comment number 42.

    @ Barrie #41 - nice tag line!

  • Comment number 43.

    and, Jeremy to Moderate Interactive Discussion on Realities and Myths of Ongoing Biofuels Debate
    http://www.marketwatch.com/story/world-biofuels-markets-2012-to-offer-final-word-on-food-versus-fuel-issue-2011-11-28

  • Comment number 44.

    tawse57 wrote: "This economic crisis will be - for the umpteenth time of saying - only solved by trade barriers going up."

    And who will enforce those barriers other than the very people who out think are being overpaid and have too great a pension? Surely you don't expect the market effectively self-regulate?

    All of us have "beliefs" which are contradictory. That is, human, and quite normal. But it's why we need a state which is "joined-up" and if one looks at the pdf provided in an earlier post, whilst never all that big in Britain, is has been withered away at a time when it was most needed, because activity had been speeding up through technology. It's one thing to call for solutions, but those require regulators. A state. A Public Sector. In recent times the attacks on the Home Office and Ministry of Justice have increased - Borders Agency, Police and Prison and Probation - before that it was Social Workers. People don't see the mechanism. They focus too much on the delivery agent rather than the eroded infrastructure. They focus on the men and women not the work, even when the men and women have often been recruited and retained to make the system fail. if Libertarian politicians want to deregulate all they need do is put the "wrong" people in the important jobs. Count on the public to attack the people-in-post and not the governance which effectively put them there!

  • Comment number 45.

    They say the truth will set you free...unless you try and say it on here. George warned us about you lot

  • Comment number 46.

    THE PRIVATISATION PACE IS ACCELERATING – WATCH OUT BBC!

    Navy and RAF search and rescue privatised despite Prince William objections
    http://www.telegraph.co.uk/news/uknews/defence/8921347/Navy-and-RAF-search-and-rescue-privatised-despite-Prince-William-objections.html

  • Comment number 47.

    redacted version:

    muse wrote is response to my comment Friday:

    "Do you use the NHS or the private sector for your health-care provision?

    (that's if you live in the UK of course)"

    Have you ever met a NHS doctor who knows anything about nutrition?

    Have you ever seen the damage done by ****** and ***** on a ****** patient?

    Have you ever seen a ***** man riddled with ****** -sent home to *** - but ***** by a little fella in Mexico - who happens to have a 90+ percent success rate with nothing more than ****, ******* and **** whilst that work gets suppressed as quakery by big ***** and the ******** establishedment?

    You asked me have I ever used the NHS/private. Yes I have and they do much good work, but they are also responsible for many ***** and prolonged *** ******. I think you'll find the stats don't lie: the biggest ****** in the western world is orthodox ******* intervention.

    Did you not know that musev?

    As the songs Goes: the **** don't work, and they just make you *****.

  • Comment number 48.

    Can we not sack all the public sector workers who go on strike Wednesday..that'd be nice. Also could we not charge the Union barons (Marxist/Lenisinist/trots the lot of them) with sedition and take them for a quiet visit in the woods. Could we do that do you think?

  • Comment number 49.

    Given pakistan is probably responsible through their support for the taliban for many Nato deaths its a bit rich for them to get the hump?

  • Comment number 50.

    #47

    cheers for responding kev...

    ...but it now looks like CRAPITALISM ISN'T WORKING...

    Prepare for riots in euro collapse, Foreign Office warns
    http://www.telegraph.co.uk/news/politics/8917077/Prepare-for-riots-in-euro-collapse-Foreign-Office-warns.html

    "The Italian government yesterday said that in talks with German Chancellor Angela Merkel and French President Nicolas Sarkozy, Prime Minister Mario Monti had agreed that an Italian collapse “would inevitably be the end of the euro.” The Financial Services Authority this week issued a public warning to British banks to bolster their contingency plans for the break-up of the single currency.
    Some economists believe that at worst, the outright collapse of the euro could reduce GDP in its member-states by up to half and trigger mass unemployment."

    And it's only Tuesday!

  • Comment number 51.

    Egyptians say Democracy doesn't change anything

    welcome to democracy!

  • Comment number 52.

    5 billion is just about the same that is handed out every year to millionaire landowners for merely owning land with no requirement to do anything other than hoard land and milk the subsidy.

    why is this money ring fenced? why is there no land tax? Who are these people in the inner empire of landowners? How are they related to people in Government or the Lords?

  • Comment number 53.

    Iceland wins in the end

    http://blogs.telegraph.co.uk/finance/ambroseevans-pritchard/100013462/iceland-wins-in-the-end/

    “Iceland's policy of drastic devaluation with capital controls has not proved to be the disaster that so many foretold. Its refusal to accept the full burden of private bank losses has not turned the country into leper-land. The nation has held its social fabric together. Had Iceland been in the eurozone, it would have been forced to pursue the same reactionary polices of "internal devaluation" and debt deflation being inflicted today on the mass ranks of unemployed across the arc of depression.”

  • Comment number 54.

    SPEAKING OF EMPLOYMENT: DID YOU KNOW MPs ARE NOT EMPLOYEES? (#48)

    So: if an individual stands for Parliament, they are NOT seeking employment; so what ARE they doing? What laws apply? Who has actually HIRED the election winner (for whom does an MP work)?

    If the aspirant uses DECEPTION to get elected, does every-day law apply, or fleeting Election Law? And much more.

    I am opening a can of worms. What it says on the tin, is STRANGELY INDISTINCT . . .

  • Comment number 55.

    GEORGE IS WORRIED WE ARE FALLING BEHIND THE REST OF THE WORLD

    Rubbish George. Britain leads in madness, nihilism and PERVERSITY.

  • Comment number 56.

    41. At 11:11 29th Nov 2011, barriesingleton wrote:
    Who cares: let's jump on the media/PC bandwagon


    Not the nicest individual to be sure, but seeing the volume of forces of 'good' in PC form, law-defending and media-affront-bearing, whilst dropping or further ignoring other, possibly more egregious 'abuses', does make one wonder at the priority mindsets in certain quarters.

    Mind you, it was fun watching the twitter mobs being deployed by their media masters asking if they should drop trying to hunt down the Climategate 2 hacker whilst they tracked this lady.

    Pitchforks are a given, but I wonder if flaming brands are optional?

    At least the common sense is settled. If not in a good way.

  • Comment number 57.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 58.

    WHAT DEMOCRACY EVER DID FOR US (#51)

    We now have a FAR MORE SOPHISTICATED CLASS OF CORRUPTION.

    Lucky Egypt. There is that to look forward to.

  • Comment number 59.

    kevseywevsey wrote: "Have you ever met a NHS doctor who knows anything about nutrition?"

    All of them do. Do you not know that (NHS) doctors are all trained in biochemistry etc? It take about 10 years to become a doctor (5 in medical school and then a further 5 to become either a GP or Consultant). What they talk to patients about is largely limited by what the patients know. There's so much rubbish out there in the markets (consumer goods sold as cosmetics because they have no effect - that's what a drug is that has no effect, a "cosmetic"), that doctors have to spend a lot of time listening to "lay-experts" who know nothing just as part of their "bedside manner"

    Why do people go to doctors if they know better?

    What we're generally seeing in the decline of the NHS is something which has been contrived by successive Libertarian Governments. They do this so they get the electorate to vote for their erosion of the state. Just think about it. How else could they do it? It is all about privatisation and deregulation. In the NHS it is Foundation Trust status, in schools Trusts. This puts the assets in th hands of Trustees and that means thousands of separate agencies who can sell off and cut without Civil Servant oversight, The Civil servants may battle against these politicians, but in the end, they are answerable to their Ministers.

    http://www.civilservant.org.uk/numbers.pdf

    Look at the numbers, and think what you are aiding and abetting. If you are fully aware of it, fine, that's your democratic right. If you aren't, give it some thought. I am happy to be corrected with evidence, as the way things are going is bleak and we need an alternative analysis.

    Next think about Michael Gove when he criticises the teaching unions - these are his own mode of Governance! Many people don't see how these Libertarians (Balls and Miliband included) go about attacking their own state and rally the public to do the same. As I see it, it's national/social/economic suicide. It's the American way of freedom and it's why there was an exodus of anarchists to the USA in the late C19th and early C20th from Europe as Europe tried to regulate. It's precisely what China, Russia and the SCO and BRICS oppose.
    .
    Have a look at the end of this - it deserves to be looked into, if only to refute it. They weave a tangled web.

    http://www.dailymail.co.uk/debate/article-2063409/He-sound-like-Dalek-doing-bad-impression-Kenneth-Williams-DO-BBC-stars-want-exterminate-Pesto.html

  • Comment number 60.

    WHY DID PADDY ASHDOWN'S BRILLINACE NEVER ACHIEVE ANYTHING?

    Is it because only he knows its infinite reach?

    Why not set Ed Balls and Paddy to 'debate'?

  • Comment number 61.

    kevseywevsey understandably got angry about what he sees happening:

    Let me spell out the long-term self-destructive mechanism again, i.e what's wrong with our liberal-democracy (anarchism)..

    Imagine 600,000 babies being born each year, and that genetic cognitive ability is Normally Distributed - i.e the shape of the a Bell Curve.

    That means, taking an average of 100, that 67% of the population falls between a score of 85 and 115, about another 15% falls between 115 and 130, and another 15% between 70 and 85. We'll forget about the extremes about 130 and below 70.

    Now, it takes all sorts to make a society, and whilst one type is not better or superior to another, one does have to look at the longer term process (inter-generational) to see how the workforce will change as a result of regulative or deregulative policies.

    If one takes the half above 100 and keeps them in education longer than the bottom half (half the cohort gets the 5 x A-C grades required to stay on), sending the top half to university and some to post graduate training or in-service-training (CPD) in the workplace, that group will delay getting married and/or having kids, especially the females relative to the other half. Meanwhile, the other half starts families.

    In the long run, the population shifts downwards. One ends up with less people in the top half of the curve and more in the bottom.

    If one needs people in the top half to provide services like medicine, dentistry, and other jobs requiring high tech skills, they soon get overloaded with demand from the lower half which has grown in number.

    Look at sub-Sahara Africa for doctor to patient ratios as an example (mean for Sub Sahara Africa appears to be about 70 believe it or not, this does not make them bad people note)

    Not only does the national average shift downwards, but as there are not enough doctors, standards are dropped or one has to import from abroad.
    But.....if those abroad have lower averages to start with....One has a problem of "norming" is the tests are "standardised" internally (technical points).

    Lots of us used to believe that people's behaviour was plastic, in that we could just teach anyone anything if we tried hard enough. We now know that was a false assumption. Abilities are largely genetic.

    If one doesn't regulate a population it tends to go to pot. Think farming.

    This is our problem. It is a serious issue. Not one to get upset about, it is one to be addressed.

  • Comment number 62.

    "BBC News - Norway massacre: Breivik declared insane"

    "In a manifesto he published online, Breivik said he was fighting to defend Europe from a Muslim invasion, which was being enabled by what he called "cultural Marxists" in Norway's Labour Party, and the European Union."

    http://www.bbc.co.uk/news/world-15936276

    That mass immigration into Europe has been enabled by Socialist International political parties and that these Social Democrats have been widely regarded as "Cultural Marxist", "Left Communist", "Libertarian" or 'New Left is in fact almost de rigueur. However, any assertion that political opposition to, or identification of, such policies as paranoid schizophrenic (which usually begins showing up in late adolescence or early adulthood and is picked up by others very
    quickly) is possibly just dirty politics. Several decades ago much was said about the Soviets abusing psychiatry to lock up those who dissented. It's an easy charge to make, but one which has to be rigorously examined.

    On the other hand, taking a rifle and handgun, and shooting lots of kids at a youth Labour camp is not normal or acceptable behaviour. It's not even the sort of political behaviour which one usually finds in political extremists, as the victims targeted were children. What we have not heard enough about to date is Brevik's behavioural history, and that which we have heard to date made him out to be normal. So there is a puzzle.

    Mass immigration into Europe is most parsimoniously explained a means to compensate for Europe's low birth rates, which in turn appears to have been a result of Libertarian politics over many decades. Muslims are not the bad guys and gals, any more than the kids at the Norwegian camp were.

  • Comment number 63.

    "If one needs people in the top half to provide services like medicine, dentistry, and other jobs requiring high tech skills, they soon get overloaded with demand from the lower half which has grown in number."

    It also results in a fall in production of technical goods, engineering etc, as the nation just doesn't produce enough of the people to do those jobs.

    See manufacturing and innovation.

    This analysis above is not "rocket science" - but try as one might to find empirical fault with it, it is difficult to find evidence at odds with it, and that's not for want of trying. In science and engineering one sets up models and one tries to test them to destruction. This one has been subjected to a lot of stress tests over the years and sadly, it HASN'T failed, just look about you to see some of the "real world"
    evidence.

    The only solution surely is to get a grip on regulation i.e demographic regulation, gentle population management - and that means building UP the Public Sector, not withering it away. Only those NOT interested in this country (aside from treating it as a source of local child-like consumers and cheap labour) would ever let this debacle have happened.... surely? Most people seem oblivious to this. Why? It's not that difficult to grasp surely? Or is it wrong? if so, where is it wrong?

  • Comment number 64.

    it appears Jeremy Clarkson and James Whale have a few fellow travellers on these sites after all, this country gets more fascist by the day......

  • Comment number 65.

    Karel Williams is right. It was said at the time that if you loose these industries, it takes a very long time to get back. The best time to do this was during the time when labour was in power during the so-called boom. It takes 1,2, 5, 10, 15, years to turn the rebalancing around, not 5 months. When I was studying Naval Architecture, even engineers who had become university lecturers believed the manufacturing industries were the past and we were now, only a service economy. After all of us students stopped looking at each other in disbelief, we got on with our stiudies. later after the first year, Southampton Institue axed this course (30 odd bums on seats), in favour of a leisure course (300 bums on seats). Needless to say, life has never been the same, but this was a short term decision, and mistake. New technologies that are coming to fruition (many in the UK) can make the UK more (close the gap in a large way) competitive in these so-called traditonal (much of the financial sector could be regarded as traditional then) industries again, such as shipbuilding and other heavy, and heavy hi-tech industry which we are very good at, but it will take more than 5 months.

 

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