Newspaper article The Evening Standard (London, England)

Obama Rides to Rescue of Brown's Plan for Economy

Newspaper article The Evening Standard (London, England)

Obama Rides to Rescue of Brown's Plan for Economy

Article excerpt


GORDON BROWN today seized on support from Barack Obama for his battered blueprint to drag the world out of recession.

The President shored up the Prime Minister's masterplan to tackle the downturn through greater spending, just 24 hours after he was dealt a blow by the Bank of England governor.

Mr Obama also warned European countries that they should not try to piggy-back on America's huge fiscal stimulus to restore economic growth while refusing to open their coffers to deal with the crisis.

"All of us are going to have to take steps in order to lift the economy," he said in a televised press conference.

"We don't want a situation in which some countries are making extraordinary efforts and other countries aren't with the hope that somehow the countries that are making those important steps lift everybody up." Mr Brown was this morning meeting Wall Street bankers and business leaders in New York on the second leg of a 17,500-mile tour to drum up support for next week's G20 summit in London.

He will later have talks with UN Secretary General Ban Ki-Moon before travelling to Brazil and Chile.

The Prime Minister used a speech to MEPs in Strasbourg yesterday to exhort the European Union to take the lead in rehabilitating the world economy and forging a new "moral" capitalism.

He called for an end to offshore tax havens, tougher financial regulation, and international limits on remuneration, while stressing that Europe is "uniquely placed" to provide leadership in the economic crisis -- although Germany and France are resisting the major fiscal stimulus that Mr Brown and Washington have advocated.

The Prime Minister suffered another rebuff when the Bank of England governor, Mervyn King, warned that Britain may not be able to afford further fiscal stimulus measures.

"I think the fiscal position in the UK is not one where we could say, 'well, why don't we just engage in another significant round of fiscal expansion'," he told the Commons Treasury select committee.

His remarks were seen as signs of a split between the Treasury, which is understood to be far more cautious, and Downing Street over pumping billions more into the economy. …

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