British coalition talks hinge on cutting the deficit

The efforts of the Brits to forget a coalition government is centering, according to this article, on how to drive down the deficit, avoiding another Greek syndrome.  Notice that the American deficit is just as bad, suggesting that cutting budgets and imposing austerity measures will be the task of all responsible governments:

Inside the stately buildings of Whitehall in the shadow of Big Ben, party leaders trying to forge a government hunkered down for talks this weekend with a 167-billion-pound elephant in the room: the British budget deficit.

Investor panic over Greece’s debt problems is engulfing Spain and Portugal, and political officials here are racing to head off speculation that Britain could be next. Thursday's election yielded no clear majority in Parliament, plunging parties into intense rounds of horse-trading to assemble a workable coalition. Their most critical goal: the creation of a government willing to undertake what is set to be the most painful round of spending cuts in Britain since World War II.

The focus of the coalition talks underscores the rising alarm over yawning deficits and crushing debt in developed nations since the onset of the global economic crisis. In Britain, stimulus spending and collapsing tax rolls have left the budget deficit — the shortfall between what the government takes in and what it spends — set to jump to 12 percent of national income this year, the highest in the European Union and roughly on par with that of the United States.

via British coalition talks continue as parties focus on deficit.


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