Afternoon:
10°c
We can cut interest rates still more, claims Brown
Joe Murphy, Political Editor14 Nov 2008
GORDON BROWN held out the hope of more dramatic interest rate cuts today.
In New York, the Prime Minister said there was scope for rates to drop further even after the recent unprecedented 1.5 per cent cut.
He also called as a matter of "urgency" for all the world's big economies to unite in a co-ordinated effort to boost the global economy with a package of tax cuts and spending.
Mr Brown urged hundreds of billions of pounds of higher spending and tax cuts in a co-ordinated move by the world's powerhouse economies.
Speaking in New York before heading to a summit in Washington he said: "It is now becoming increasingly accepted around the world that a temporary and affordable fiscal stimulus is necessary."
He added: "There is a need for urgency. The cost of inaction will be far greater than the cost of any action."
The summit was overshadowed by figures showing Europe's single currency zone is now officially in recession. It shrank by 0.2 per cent in both the second and third quarters.
Mr Brown also warned against any retreat into protectionist policies to save jobs, saying free trade was vital for a return to growth.
"Let me send out the strongest message that the road to economic ruin in the past has been following the path of protectionism," the Prime Minister said. "The way forward is not countries working in isolation or against each other, but countries cooperating together."
The G20 leaders represent the biggest economies and 85 per cent of the world's wealth. Their gathering was being billed as "Bretton Woods 2", after the 1944 summit that established the financial rules for the post-war world. Mr Brown was hoping his success in leading the global moves to prop up the banking system would encourage others to copy his fiscal stimulus package, which is to be unveiled in the pre-Budget report on 24 November.
He argues that such policies will have a massive effect if all big countries do the same thing. Meanwhile, George Bush denied the financial crisis was a failure of capitalism.
The President said: "The answer ... is to fix the problems we face, make the reforms we need, and move forward with the free-market principles that have delivered prosperity and hope to people all across the globe."
President-elect Barack Obama is not attending this weekend's summit meetings but Downing Street said members of his team would be in meetings with Mr Brown.
With more job losses announced, No10 said Mr Brown was sympathetic and determined to help people get back to work.
But despite last week's interest rate cut by the Bank of England there are fears that such moves on their own will not be sufficient.
Reader views (21)
Do your usual con trick increase duty on fags,booze and petrol!You have been doing it for the last 10 years to the delight of the stupid socialist voters!
- Alan, Chigwell.UK., 17/11/2008 08:46
Report abuse
He can?! Did he not waste all money now just that we need it?! Crash Gordon should go before the mess gets even bigger.
- Georgie, Islington, London, 16/11/2008 17:21
Report abuse
CAN ANYONE TRUST "BROON & GANG"! at this moment in time.....Its just a blatant attempt to encourage votes ....Is it not ??
- Peter Murray-Clarke, polgooth cornwall uk, 16/11/2008 10:22
Report abuse
I am fed up hearing Darling and Brown saying "we will do whatever is neccessary", they don't know what to do, except dirct attacks on others.
Now we are having the old NuLabor spin getting into full swing.
Are we going to believe this again?
- Brian Hughes, wales, 15/11/2008 15:37
Report abuse
Listening to the news this morning (Saturday) on both BBC & ITV it was a bit nauseating to hear nearly all of the commentators saying that Osbourne is probably correct but then scorning him for breaking with protocol and then trying to blame the inevitable consequences of Browns reckless spend spend spend policies on him. I don't remember similar comments when the Governor of the Bank of England stated that we are already in recession which sent the value of the pound down.
This sounds like a smear campaign with a strange smell of Mandelson and Campbell to get Brown off the hook.
- R King, Hampshire, 15/11/2008 11:52
Report abuse
It is a sign of insanity, to keep doing the same thing and expecting a different outcome. Cutting interest rates recently by 1.5% hasn't had any material effect, so why will further cuts do the trick. Being such a clever fellow, where are the much needed solutions to a financial crisis, downturn, disaster that was created by Mr Brown over 10 years of mismanagement of a recovering economy handed to him by Ken Clark.
- J R J, Ballagarey, 15/11/2008 08:52
Report abuse
Brown must be the biggest most useless piece ever produced by these socialist fools.
- Frederick, London, UK, 15/11/2008 08:22
Report abuse
How about "we can also cut fuel duty", Gordon? Stop telling others what to do and do something yourself!
- Marianne, SW France, 15/11/2008 06:19
Report abuse
Debt is what got us to this point of disaster. Debt is caused by reckless lending standards. Offering money at rates below inflation to people who may or may not pay it back. What happens to savers? What encouragement do we offer people who save for their dotage? Prudence is a lost cause and Browns true colours are washed out in the fading Autumn sun.
- Colin Bond, London, 14/11/2008 18:41
Report abuse
CUCKOO !!!
Why not just give them money to spend !
To hell with saving for their old age or even a rainy day.
- Bernard Parke, Guildford, 14/11/2008 17:57
Report abuse
Well done Gordon. You are doing a superb job countering the credit crunch. We have faith in your money management skills that Osborne and Cameron so obviously lack.
- Keith Price, Luton, England, 14/11/2008 17:02
Report abuse
Looks like I missed the General Election announcement.
- Ted, Shetland, 14/11/2008 16:58
Report abuse
Saint Gordon the Righteous will have his 'comeuppence' because no self-respecting socialist will have any further truck with a party leader that has done so much damage across so wider range of society that hardly anyone can escape the blitzkrieg of his policies as Prime Minister or in his former guise of Chancellor of the Exchequer. This selfish power crazed man has no respect for anyone at any age and his only answer to the current crisis is to encourage a further round of spend! spend! spend! Where is the morality in that. As a real socialist not a New Labour one, I object to our dear country being taken to hell in a handcart and I won't be encouraging anyone to vote Labour until we rid ourselves of the vipers that have sold our principles down an unbridled capitalist river.
- John, Leighton Buzzard, Beds, 14/11/2008 16:44
Report abuse
The Bank of England is supposed to be independent! Why is Gordon Brown saying "WE can cut interest rates..." The whole point of making the BoE independent was so that it could not be manipulated for political reasons.
If Gordon Brown is now taking decisions on interest rates, where does that leave Mervin King? Neither inspire much confidence, but if the Bank is independent then any announcements should come from the Bank. Brown will do whatever it takes to cling on to power; and will destroy any institution that gets in his way.
- Beatriz, London, 14/11/2008 16:31
Report abuse
Cutting VAT and Fuel taxes will have the immediate effect Brown wants.
It is rather hypocritical of him saying that "the cost of inaction will be greater than action" as he had every opportunity earlier on to act-I hope these words come back to both bite and haunt him.
Why can't he just go and leave us all alone?
- Harvey Lawrence, London, 14/11/2008 16:24
Report abuse
Dont panic Gordon will get us out of this mess. He may well drop us in a bigger one. But that wont be his problem by then will it.
- Dave Smith, Croydon, 14/11/2008 16:09
Report abuse
There is a limit Gordon. You can't cut them below zero, otherwise you'll be giving the money away.
- Dhanraj, Basildon Essex, 14/11/2008 15:44
Report abuse
So much for an independent Bank of England.
- Chris, UK, 14/11/2008 15:40
Report abuse
Alistair Campbell's 'we can cut interest rates still more' cynically masterminded 'Brown spin' news soundbite makes it sounds like the PM's in command doesn't it?
Whereas more huge cuts are, in all reality, inevitable.
Brown and Darling and McLabour and King, and Britain incidentally, are actually helpless.
Brown is being less than disingenuous, again.
- Dave, Cumbria, 14/11/2008 15:32
Report abuse
Even though I think Interest rates will drop as far as he says, I still instinctively disbelieve anything that comes out of his mouth.
- Alex C, London, 14/11/2008 15:06
Report abuse
It's all very well to keep driving the interest rate down, but it's not to the advantage of everyone. Some of us don't have a mortgage or loans,and do have some savings. We have lived within our means and only spent what we can afford. Be fair Gordon, and have the guts to reduce VAT and the tax on petrol! That way we all benefit,not just those in debt.
- Meldroo, Oldham England, 14/11/2008 15:02
Report abuse
