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Election 2010: Everyone's a loser

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6th May 2010
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Whoever wins this election will end up a loser in the long-term, according to Bank of England governor Mervyn King.

Brown, Cameron and Clegg all want to be Prime Minister – but Mervyn King, governor of the Bank of England, reckons they should be careful what they wish for.

According to a US economist, King believes that whoever wins the election will inherit such a poisoned chalice that their party will be knocked out at the next election and face an entire generation in the political wildnerness.
 
As governor of the Bank of England, King has maintained a public position of complete neutrality and offered no comment on the policies of any of the political parties in the election campaign. But he appears to have made certain comments during a private lunch meeting that have now been made public.
 
Economist David Hale said in an Australian TV interview: “I saw the governor of the Bank of England last week – and he told me whoever wins this election will be out of power for a whole generation because of how tough the fiscal austerity will have to be.”
 
Hale argued that the prospect of a hung parliament resulting from next week's vote would risk seeing the UK's credit rating cut. "Right now the polls suggest it could be a hung parliament, and if a hung parliament...could not produce in June a meaningful budget to reduce their fiscal deficit, I think the risk is very, very high that you will see Britain's credit rating cut from triple A to double A,” he said. "A hung parliament [would] make it very hard to impose the tough fiscal policies Britain will need. I'd be very bearish right now on both the British pound and on the British Government bond market."
 
King’s alleged comments come after the Institute for Fiscal Studies (IFS) accused all the main parties of failing to come clean over the depth of the cuts needed after the election.

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David Winch
By David Winch
06th May 2010 18:06

Rivers of tears

Last Friday I was posting about rivers of tears - obviously I am not alone in that view (many respondents agreed, whilst also cheering me up by reminding me that we are still in the football World Cup, etc).

I just wonder whether I will be feeling any more optimistic this Friday!

David

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