As Andrew stressed earlier, the European response to the credit crunch has been anaemic (How anaemic? Check out the footage below of Gordon Brown and his EU compatriots agreeing the “way forward for [the] global economy”). By contrast, the Americans have been the very model of proactivity – introducing sharp interest cuts and proposing massive tax relief programmes.
What’s holding the British Government back? I suspect it’s a combination of economic and political motivations.
Economically, there’s the argument that America’s experiencing things worse, so Britain doesn’t need to act quite as decisively. If Brown believes this, then he’s going against the wisdom of commentators such as Anatole Kaletsky, who recently wrote that:
“At the beginning of this year I wrote that if the financial markets did not resolve the credit crisis by February, the governments of the world would have to come up with a Plan B. Central banks would slash interest rates or governments would cut taxes and offer guarantees or regulators would fudge accounting rules to ensure that banks could keep lending ….
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