George Osborne: eurozone crisis killing UK recovery

[AtW]

"The UK's hopes of economic recovery are being "killed off" by the eurozone crisis, the chancellor has warned.

Writing in the Sunday Telegraph, George Osborne said European leaders faced a "moment of truth" which could determine the economic future for over a decade.

He added that British businesses were "being held back because of uncertainty about the future" (AtW's comment: it's your fooking job to make sure the future is certain.)

Labour's Ed Balls said Mr Osborne was making "desperate excuses" for the government's failure to deliver growth.

The newspaper article comes in the wake of an announcement that Spain will get up to 100bn euros ($125bn; £80bn) in loans from eurozone funds to shore up its struggling banks.

BBC deputy political editor James Landale says Mr Osborne has spoken before about the negative impact of the eurozone crisis but never in such stark language - or with such pessimism about the UK's future recovery. (AtW's comment: this means he probably got early access to Q2 GDP figures)

Mr Osborne wrote that treating the "latest symptom" would not be enough to "cure the underlying conditions".

He added: "Our recovery - already facing powerful headwinds from high oil prices and the debt burden left behind by the boom years - is being killed off by the crisis on our doorstep."

The chancellor continued: "The British government is clear that it is strongly in Britain's interests for our biggest export market to succeed; the risks for us of a disorderly outcome are huge."

He called for greater fiscal integration across the eurozone bloc and said a banking union was a "natural extension" of the single currency.

However, he emphasised that the UK would not be part of any such arrangement and that any further transfer of power from Westminster to Brussels would require a referendum.

Mr Balls said it was "deeply complacent and out of touch" to blame the eurozone for a "double-dip recession made in Downing Street".

The shadow chancellor added: "Despite the eurozone crisis, Germany, France and the euro area as a whole have so far avoided recession while Britain's recovery was choked off in the autumn of 2010."

Source: BBC News - George Osborne: eurozone crisis killing UK recovery

When somebody like Ed Balls is correct in his economic assessment you know tweets like Osborne and "just call me Dave" will never win next election.

[Waldorf]

Ah, but Ed Balls is wrong.

Balls did say that if the government made cuts then we would risk a double dip recession, but since that the Eurozone mess has erupted and is yet to be sorted.

There is no doubt that the uncertainty from the Euro is dampening investment etc, why else would UK companies hoarding £750 billion. As soon as there is some certainty from Europe I believe that business will start to invest and consumers will be happier to start spending etc.

Anyway, as for cuts, this year the government will spend £40billion MORE than was spent in the last year of the Labour government.

I am also sick of hearing Balls saying "too far, too fast" - whilst I can appreciate a different view on how fast to make the cuts, but "too far" there can be no doubt that we have to eradicate the deficit asap, so it is not a question of being too far, we then need to tackle repaying the debt.

[Doggy Styles]

Yes, in this case Osbo is right.

Ed Balls is utterly wrong as always, but what else can he say.

[VectraMan]

Balls has the luxury of never having to be judged on his actions, or on what he says. It's pretty telling that the best alternate strategy the opposition can come up with is to do the same as the Torys, but a bit slower.

[Spacecadet]

This weeks "Any Questions" was quite lively and the audience clearly doesn't trust Labour's monetary policies

BBC - BBC Radio 4 Programmes - Any Questions?

[eek]

This weeks "Any Questions" was quite lively and the audience clearly doesn't trust Labour's monetary policies

BBC - BBC Radio 4 Programmes - Any Questions?

A posh village within Harrogate is hardly representative of Labour voter opinion. Any labour voters found there are likely to end playing the foxes in the next hunt.

[Mupps]

Am i being simplistic or why can't they do both: austerity & investment?

Austerity: cut back on the ludicrous over-spending and waste in the public sector, cut the padded workforces and luxurious benefits, pensions, etc etc.

infrastructure investments: build some better roads, airports, i dunno- big stuff.

Mind you, i'm working for a public sector project at the moment and the semi-competent muppets are spraying cash around at a rate i have never before imagined. I keep asking when the cost of the plans is going to be reviewed and pressure comes back to do it at a fraction of the price as you do in normal businesses. I just get the answer that that doesn't happen in the public sector.

Just "smile and wave" and "shut up and keep invoicing" i guess.

[Spacecadet]

A posh village within Harrogate is hardly representative of Labour voter opinion. Any labour voters found there are likely to end playing the foxes in the next hunt.

Where do I say the audience was representative of labour voters? And obviously they're not core labour voters, they appear to be able to think

[Doggy Styles]

Am i being simplistic or why can't they do both: austerity & investment?

Austerity: cut back on the ludicrous over-spending and waste in the public sector, cut the padded workforces and luxurious benefits, pensions, etc etc.

infrastructure investments: build some better roads, airports, i dunno- big stuff.

You are being simplistic.

Your austerity is very difficult to do politically. That's what HMG are trying to do, and so far they are only dipping their toes into the water and already getting loads of hassle.

Your investments would use up the money saved by austerity, which will not reduce the deficit.

[SueEllen]

Where do I say the audience was representative of labour voters? And obviously they're not core labour voters, they appear to be able to think

That's unfair.

There are plenty of ex-labour voters and ex-members who attacked the current lot.