Tags: uk | u.k. | budget | nobel | clegg | economy

Nobel Economist Criticizes UK Budget Cuts

Sunday, 24 Oct 2010 12:38 PM

U.K. Deputy Prime Minister Nick Clegg said he found it “morally difficult” to push through the biggest budget cuts since World War II, measures criticized by Nobel Prize-winning economist Christopher Pissarides.

“I have certainly searched long and hard into my own conscience about whether what we are doing is for the right reasons,” Clegg told the BBC’s “Desert Island Discs” radio program, which aired Sunday. “I am not going to hide the fact that a lot of this is difficult. I find it morally difficult. It is difficult for the country.”

Clegg, whose Liberal Democrat party is the junior partner in the U.K.’s coalition government, is trying to convince voters that the cuts are worthwhile. There are no “pain-free alternatives” to the measures, which were announced on Oct. 20 by Conservative Chancellor of the Exchequer George Osborne, he said. A poll published by News of the World showed Liberal Democrat support fell two percentage points to 16 percent.

The Conservative Party rose two points to 40 percent and Labour support climbed by the same margin, increasing to 36 percent. ICM surveyed 1,025 adults on Oct. 21-22.

The coalition’s spending cuts will peak at 81 billion pounds ($113 billion) in 2015 as it seeks to shrink the deficit to 2 percent of economic output from more than 10 percent today. The plan, which the government says is necessary to stave off a Greek-style budget crisis, will lead to half a million public job losses.

Yet the winner of the 2010 Nobel Prize for economics, Christopher Pissarides, wrote in the Sunday Mirror newspaper that Osborne has “exaggerated” the risks facing the U.K. and the spending cuts may make the economic situation worse.

“No one doubts the chancellor is taking risks with the economy,” wrote Pissarides, a professor at the London School of Economics. “These risks were not necessary at this point. He could have outlined a clear deficit reduction plan over the next five years, postponing more of the cuts until recovery became less fragile.”

Speaking before the Confederation of British Industry’s annual conference tomorrow, Clegg told the BBC’s “Andrew Marr Show” the government’s focus is moving on to economic growth.

“There’s nothing pro-growth about having this deadweight of debt around our necks, there’s nothing pro-growth about spending 120 million pounds a day just simply on the interest on our debt,” Clegg said. “We need to move on to the rest of the equation, lay down the conditions in which growth will flourish.”

Clegg also revealed on Desert Island Discs that he is a fan of Schubert, Johnny Cash, Prince, Radiohead and David Bowie. Asked what book he would take if he found himself marooned on a desert island, he opted for Giuseppe Tomasi di Lampedusa’s “The Leopard.” His one luxury would be a “stash” of cigarettes.

“I know I’m not supposed to say this because it’s a terrible thing,” Clegg said. “And I hope my children don’t hear this program because they don’t even know that I smoke.”

© Copyright 2017 Bloomberg News. All rights reserved.

1Like our page
2Share
Economy
U.K. Deputy Prime Minister Nick Clegg said he found it morally difficult to push through the biggest budget cuts since World War II, measures criticized by Nobel Prize-winning economist Christopher Pissarides. I have certainly searched long and hard into my own conscience...
uk,u.k.,budget,nobel,clegg,economy
497
2010-38-24
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved