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Gordon Brown Predicts A Decade Of Decline For The West

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http://www.guardian.co.uk/politics/2010/dec/06/gordon-brown-decade-decline-west

Gordon Brown has warned the next decade could be remembered as the "decline of the west" if it fails to grapple with the challenge of the rising Asian powers.

In an interview ahead of the publication of an exclusive extract from his forthcoming book in today's Guardian, Brown was critical of public spending cuts which he said could rob western governments of the firepower needed to win business in China and India.

He said western governments had 10 years to overhaul their economies, invest in hi-tech equipment and promote high-quality education.

In Beyond the Crash, Brown says a global compact next year, under the G20, could champion measures to spur growth creating between 30m and 50m jobs and ending mass unemployment.

"On current trends, Europe and America face high unemployment for a decade and worsening youth unemployment to come," he said in advance of publication. "If the story of the coming decade is not to become 'the decline of the west' then Europe and America have to change tack, rise to the biggest challenge of all – restructuring the world economy – and equip themselves to benefit from the next great global challenge – the dramatic rise in the consumer spending power of Asia."

..........

Many consider his finest hour was at the G20 summit in Pittsburgh at the height of the crisis when he persuaded world leaders to join a rescue mission. Brown said it was clear his views were no longer fashionable, "but as the 1930s showed, the economic orthodoxies for which people are feted today will quickly come to be seen as the great misjudgments of history".

If only he'd been in power for over a decade and could have addressed these issues at the time...

He's delusional.

So dumbed down mass education won't cut the mustard then?

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He was and always will be a charlatan. No understanding of business, money or economics. He should never have been let any where near the levers of power.

Agree totally. He ain't done with his wrecking ball yet though - expect to see him and his charming smile at the World Bank, IMF, EBRD or similar some time next year. 

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http://www.guardian.co.uk/politics/2010/dec/06/gordon-brown-decade-decline-west

If only he'd been in power for over a decade and could have addressed these issues at the time...

He's delusional.

So dumbed down mass education won't cut the mustard then?

Not that the decline will affect him personally of course. The root cause of this is a mega global trend that started when the 3 billion communist blocks were brought into the world trading system - something Brown could not have done too much about (though he made it far worse with his now infamous "no more boom and bust")

I think in 10 years, the game is not just Asia, it is Africa as well - China is rapidly industrialising Africa (Ok, the more developed one such as Ghanas) as we speak.

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Trade tariffs will work far better and faster.

Yes, these are inevitable. The US will be the first to put them up - just a matter of how long before the politicians do so.

You have people like Intel's Andy Grove openly talking about this now in order to protect the future of the US.

Trade barriers will quickly become trade war will become new cold war.

Within 50 years I can see the new EU being a free-trade zone across the North Atlantic with the EU on one side and the US, Canada and perhaps Brazil on the other. Mexico will be the new Romania probably.

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http://www.guardian.co.uk/politics/2010/dec/06/gordon-brown-decade-decline-west

If only he'd been in power for over a decade and could have addressed these issues at the time...

:lol:

Very well put IRRO.

He's delusional.

So dumbed down mass education won't cut the mustard then?

Exactly!

In these past decade the west had 2 different models, the USA-UK Ponzi credit/properties bubble, and the German good education and infrastructure, with highly restricted mortgage markets, and credit directed to production. The question is: can we do a Germany? Will the government even try to do it? And if so, can it work?

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He was and always will be a charlatan. No understanding of business, money or economics. He should never have been let any where near the levers of power.

I was going to agree with you there. But on a second thought, I think Brown honestly thinks he knows economics. So, I think "delusional" is a more appropriate term. He is crazy. Really.

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Agree totally. He ain't done with his wrecking ball yet though - expect to see him and his charming smile at the World Bank, IMF, EBRD or similar some time next year.

do you really think any of them would offer him a job?

I would think America would block it after the Al Megrahi case, Asia would block it because they don't want his economic influence anywhere near them, Europe would block it owing to the influence of the current UK govt, and besides I doubt Merkel or Sarkozy have any time for brown either.

I see every avenue for further power to Brown being blocked. The local Asda probably wouldn't offer him a job. He's sh*t personified.

Edited by Si1

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I see GB's spouting yet more verbal clostridium difficile. I loath this man.

I got c.diff a few years back... lost a stone in weight and had nearly three months off work as all the courses of antibiotics were ineffective. That is quite possibly the second most unpleasant infliction that I have had to endure. The first being GB.

Spot on!

+1

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Leave him be, along with Greenspan, Bernanke, Bush, Obama, Trichet and King, he is one of the greats in my book. He's played his part and he played it well. :ph34r:

£900/Oz as of this morning B)

Edited by General Congreve

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http://www.guardian.co.uk/politics/2010/dec/06/gordon-brown-book-extract-after-the-crash

Here are his thoughts in greater detail:

The crises of economic policy in the past century teach us that the conventional wisdom of the day can easily become the misjudgment of history. In the 1920s all conventional opinion sought a return to the "gold standard" on the grounds that there was no credible alternative. In the early 1930s, all conventional opinion said there was no alternative to retrenchment as the route to recovery. "There is no alternative" was also the theme of the 1980s, giving us the orthodoxy that condemned us to the worst and longest long-term unemployment since the second world war.

But any framework that is not founded on the objective of stable and low inflation, the task of central banks, will prove inadequate. By around 2020 a more balanced, faster-growing global economy will offer the most comprehensive exit strategy from current problems. The large addition to the global middle classes and the additional reduction in poverty will create an enormous market for the global private sector, which will allow revenues to rise and government borrowing to decrease and stabilise.

Of course the global growth plan will make us more cautious about inflation, but I personally am more sanguine about the short-term path of inflation because of the low level of capacity utilisation.

However, I also note the enormous hoarding of cash on the balance sheets of corporations globally. While explaining this as another example of self- insurance in our global economy, I'm also conscious about its potential to energise growth if the global growth plan engineered the same recovery in long-term confidence that the $1tn [£650bn] plan did to short-term confidence.

That we need to monitor global growth to co-ordinate the easing of the fiscal stimulus should now be clear. By doing so we can avoid an unco-ordinated inflationary spiral, because if global confidence is high, it's my view that we will be able to reduce levels of borrowing faster in a co-ordinated fashion.

Asset bubbles I do not doubt that policies have to be implemented in a way that seeks to prevent future asset bubbles and keeps debt low. But I believe that debate is missing the point. In the past the idea that deficits would lead to inflation was the single most pressing reason people supported immediate public-spending cuts. But today the picture is not one like that of previous post-war recessions: inflation may of course re-emerge, but no one is predicting that will happen immediately.

In the past, especially in the 1980s, the case was made that public spending would crowd out private investment. But that simply does not fit with the underinvestment we are now seeing; indeed, there is a financial surplus in the private sector of $3tn for the developed world in the balance sheets of private companies.

Moreover, just as there is no immediate danger of inflation and no danger of a huge surge in demand for credit, there is little immediate danger for most countries, a few excepted, of failing to sell their debt.

The rationale for instant, severe deficit cuts cannot now employ the crowding-out argument or the inflationary-risk argument or for most countries the unwillingness-to-buy-debt argument. What's left is the argument that higher premiums have to be paid for the risks associated with "going for growth".

This is what the European Central Bank means when it talks obscurely of government indebtedness as having "opened up a number of hazardous contagion channels and adverse feed-back loops between financial systems and pub lic finances". The logic of this is that even when there is no inflation threat, even when there is no crowding out of private investment, and even when there is little difficulty in selling government debt, we should do nothing for fear of the risk that the markets may think going for growth is itself a risk. We could equally well say that the same markets that marked economies down because they had not cut enough are now marking economies down because they have cut too much — and that today the bigger risk is in refusing to act when unemployment is on the rise.

OECD analysis shows that a 1% reduction in structural unemployment would not only enhance prospects for growth but on average improve the fiscal position by .25 to .50 of a percentage point of national income. But as the IMF also argues, collective action is even more vital if we are to mitigate the risk of a further downturn. Indeed, the IMF also provides evidence that the sum of upside gains and avoidance of downside losses would yield nearly $4tn, or 5.75% higher global GDP. The number of jobs that would be created (or saved) globally would total more than 50 million. These gains would lift more than 90 million people out of poverty.

The challenge — at once structural and global — of creating higher growth and more jobs can be mastered only with a global compact among the major economic powers. Some argue that global economic co-operation in this decade will be as illusory as global co-operation was in the 1930s, because countries are by nature more protectionist in a crisis. Others suggest that the breakdown is occurring in the existing world economic order and that we risk replacing a US-dominated unipolar global system not by a multipolar order but by what [Nouriel] Roubini and [ian] Bremmer describe as a "non-polar order", in which America's chief competitors remain much too busy with problems at home and along their borders to bear heavy international burdens. Getting these groups to agree on anything beyond declarations of vaguely worded principle will be difficult.

But I believe it is possible. And it is in the space between the possible and the perfect that campaigners for justice must always be.

Stronger, more sustainable growth will not happen just by hoping for Asian consumer spending to rise. Nor from simply hoping for private investment to recover swiftly and strongly. It will require an agreement among the economic powers of the world, bigger, more imaginative, and more lasting than even the Marshall Plan for Europe: a constantly updated plan for economic growth. The way to a global growth compact is to move forward on two fronts: persuading countries, continents and leaders that future prosperity is now indeed indivisible, and appealing to global citizens to support the case that global co-operation can create jobs. Such a plan will have to be accompanied by a constitution for the supervision of global finance, otherwise we will find ourselves in the same race to the bottom in financial standards that characterised the past decade. It will also require a new academic discipline of global growth economics, which will have to do more to focus on the interconnectedness of policy action across continents.

Global pact We need to give countries reasons to be part of a global pact. Every country suffered a loss of trade as a result of the economic crisis, and half the countries of the world suffered a cut in growth. And there was no automatic mechanism by which growth could recover. The global economy is now too interconnected for one country's policy not to affect another's and for challenges we share in common to be subject to national solutions rather than global co-operation. We are also learning that co-operation cannot only avoid harm but can lead to greater benefits.

Global growth — regularly 5% a year for two decades — went into reverse in 2008. And in 2009 trade fell by 12%. We have already seen from the G20 co-ordinated fiscal injection that when the world does do things together it can multiply the impact: each continent doing what it can to stimulate our economies, each recognising that global problems need global solutions, each combining to introduce new global financial supervision, each believing that international institutions can contribute to growth — and therefore giving not just national governments but institutions like the IMF, World Bank and regional banks the resources to recapitalise banks and create new demand in the world economy.

My idea of the global new deal is that every continent not only signs up to global financial regulation but to an agreed plan to improve global supply and demand. In the absence of a global growth pact now, the world will be pushed towards protectionism later. Americans and Europeans will not see their living standards improve by continuing to buy the illusion that if you stem the tide of imports from abroad you will be better off. Only with carefully prepared agreements on growth will our living standards — and those of the rest of the world — rise.

There is no comfort in the status quo. If, as I believe, the world's problems are structural, then we have to deal with them by major surgery, not by waiting for something to change.

But as the crisis revealed, market disciplines — particularly self-regulation and regulatory approaches that reinforced greed — were inadequate to deal with the problem. The market is a necessary but not sufficient mechanism for a continuously successful economy and society. And because we are agreed that markets depend on trust, which has to be underpinned by self-discipline (which failed) or imposed discipline, we have a duty to act in the public interest.

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Leave him be, along with Greenspan, Bernanke, Bush, Obama, Trichet and King, he is one of the greats in my book. He's played his part and he played it well. :ph34r:

"I was only following orders!"

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he should really step down.he's an embarassment.I would ask whether he has any shame but I think we all know the answer.

Who are you all talking about?

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he's such a windbag, bet he could have said that using less words if he had some respect for the reader

Basically he appears to be arguing for a world super state with a planned economy. Maybe the rumours of him being a communist sleeper are in fact correct....

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Basically he appears to be arguing for a world super state with a planned economy. Maybe the rumours of him being a communist sleeper are in fact correct....

Gordon, you are scum. You are hated like no-other. You have destroyed our dreams and aspirations, you lying puddle of piss.

You have condemned anyone before your reign of evil to a life of debt slavery. You are a supporter of criminals, and theft. You are an incompotent.

But mainly you, and your slimy little party are the enemy of the UK.

Please ****** off and die. It would have been better for the UK if you and Blair had never been born.

Edited by Dan1

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Gordon, you are scum. You are hated like no-other. You have destroyed our dreams and aspirations, you lying puddle of piss.

You have condemned anyone before your reign of evil to a life of debt slavery. You are a supporter of criminals, and theft. You are an incompotent.

But mainly you, and your slimy little party are the enemy of the UK.

Please ****** off and die. It would have been better for the UK if you and Blair had never been born.

I, for one, welcome our new communist overlords

:)

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  • 312 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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