Darling to Support U.K. Economy as Debt Nears Limit

Jennifer Rudd/ October 29, 2008/ 5:30 p.m.

Chancellor of the Exchequer Alistair Darling will promise extra borrowing to support the U.K. economy as it enters a recession, signaling the end of a decade-old pledge to keep debt under 40 percent of gross domestic product. Since reading about the United Kingdom, this is not the first promise so fingers mostly certainly are not crossed. The government will show determination to support the wider economy. While refraining from making an explicit commitment about debt targets in his speech, Darling will urge other governments to support their economies and work toward improving global financial governance. This is what has needed to be done since the beginning, but it will only take a group as in a global effort. The government needs to maintain investment in job-creating public works to support the economy- boosting interest rate cuts from the Bank of England. I feel that this will drastically help the banks of England because it at some point looked as if the banks were not going to make it. The government last week pledged to bring forward projects scheduled for after 2010 to spur the U.K. economy, which contracted 0.5 percent from the second quarter as the financial crisis ravaged industries from banking to construction. I think that this is definitely a smart decision because without running companies, and the economy not growing, things do not stay stable forever that way.


Britain had its biggest budget deficit since 1946 in the six months through September as tax receipts stagnated, and economists say the shortfall may reach 7 percent of gross domestic product over the next two years, more than double the 3 percent European Union limit. The opposition Conservative Party said greater borrowing was a consequence of the U.K. entering recession rather than a strategy to support the economy, and blamed Brown for spending too much when the economy was growing during his decade as finance minister. I feel after reading the section on this it made me see both sides and both sides had great ideas but if merging them together could be an option then the economy may boom, which is ultimately what needs to happen right now.


I feel that the United States is kind of on the same path that the United Kingdom is in just in different ways. We are just a week away from our country being changed who ever gets voted in office. Right now gas has been dropping which means other things go down but just not as fast. I know that peoples jobs are still being laid off but ultimately we need our economy to be going back up the scale and have record breaking highs instead of record breaking lows.
http://www.bloomberg.com/apps/news?pid=20601102&sid=a6tFA.CyeS_M&refer=uk