Frankfurt's Forgotten Riots

“Look at you, stood protecting your blood money! You’re no better than politicians. You’re bribed by the money that is making your nation weak and is stealing from us every day and you don’t even realise it!”

Over the past two years, the Arab Spring has seen revolutions and demonstrations sweep Northern Africa in a hot fury that has both shocked and been viewed in awe within Europe. Corruption, economic hardship, and threat of wars all contributed to the radical movements that have unseated governments and autocrats alike.

This fire seems to have sparked a new European movement in itself, and this was certainly ablaze in Frankfurt last weekend. Whilst Turkish riots in the corner of Europe spread across the news as the most interesting and harrowing examples of recent protest in the Western world, the demonstrations at the Economic Central Bank of Europe went seemingly unreported in comparison.

There is no doubt that there is an economic boss in Europe, and she wears the name Angela Merkel. Germany, the economic powerhouse of Europe, has earned her place to dictate economic measures across the Eurozone, providing the backbone of the European economy. But disruption and distrust of the system sow seeds of further weakening across Europe.

Riots in Greece and Turkey are no mere trifle. The countries face growing rates of unemployment, restricted economic growth and limited financial trades. The former is set to accept a set of stringent measures by which it is to be provided with a bail out that by no means appeases the nation, who are baying for European blood amidst the onset of a further downturn.

However, when the Germans themselves come to contest the Euro, the writing really is on the proverbial wall. Here, where Berlin is seen as a symbol of democracy, the population is not likely to sit and be ignored regarding the running of their country a second time. Whether a wall is physical or fiscal, the outpouring of resentment from within the European banking capital in Frankfurt is concerning.

The force of the German police certainly took the threat seriously, regardless of the world opinion. Shutting the main financial district and sending in excess of 70 police vans to line the boulevard, forces were armed in full riot gear, lining the streets with barbed wire, and sending water cannons in to assist on the ground, helicopters to monitor from the air.

European economy is not just centred on Germany, it arguably thrives from Germany. While there have been numerous capitalist crises in the past, the gravitas of the current financial situation has still to show its boundaries. This permanent state of crisis has now come to disillusion new generations of activists and unemployed as the central countries of Europe and the US see credit ratings slash and further recession despite never ending political will to slow the rate of cuts and boost markets.

The austerity measures proposed by the so-called troika, consisting of the ECB, International Monetary Fund (IMF) and the European Commission have not reduced the national debts of the European countries. An increase of taxes and cuts of governmental social programs they promote have actually worsened the situation, deepening recession and increasing unemployment in the EU dramatically.

Since protests are now igniting not as isolated European events, but increasing in frequency and local, it shows that there are deep roots to these problems. The ‘fad’ of Occupy London is called to mind. At once, the threat doesn’t seem so unique: removed from isolation, the plight of all those that were at once both strong and desperate enough to ‘siege’ the London banking district for weeks in search of resolve is both revered in new merit and feared in equal measure.

In previous years, riots have all too often appeared incoherent and inchoate. With all but limited aims and reasons, most of these disruptions have garnered little support. But the controversy begun with ‘Occupy’ continues to threaten in new forms. The controversial 2011 riots in the UK may have started as a peaceful protest against a shooting, but an abhorrent mix of social problems ignited the violence that followed.

Sweden now faces nights of unlawful action, as the unemployed take to the street to violently protest at the state of the economy in their nation. Despite being amongst the richest nations in the EU, there has been a significant increase in the level of youth unemployment here, as with many other parts of Europe. As with the London riots, the trigger seems to have been a police shooting that has opened the floodgates of national resentment. Once topping OECD rankings for low poverty, the country is now slipping further and further down the table, with Europeans crying out for change.

Of course, things could be worse. Sweden has the EU’s lowest percentage of low-wage earners. The honour of largest low wage earners goes to Germany, with 22.2% of employers receiving minimum wage. This is possibly part of the reason for the massive outburst in Frankfurt.

There appears large discrepancy between the image of Germany, the European Powerhouse, and the economic wellbeing of its residents. Looking in, the country surely has fared better than most in the recession. But the cracks are self-evident. Low wages coupled with increasing inflation and continued bailouts, funded by the German public en masse if protesters would be believed, seriously weakens the economic standing of the EU giant and its residents.

Austerity measures on EU citizens are just scratching the surface of the potential violence of the masses. When the 99% drive the economy itself, their voices can certainly impact the future of fiscal measures, but would 99% control solve any problems in itself? Probably not, and the face of uncertainty only makes us worry and riot all the more.

#Demo2012: Demolition of University As We Know It?

Today, a third year of student protesting descended on London. However, the crucial difference is that participants will be amongst the first to actually pay the increased 9k tuition fees that came into force this academic year. Whilst the previous efforts have been dismissed in cavalier fashion, put down to rowdy or disrespectful students, here for the first time in the campaign process will the voices of those directly affected be added in force to the fight.

Westminster need face these demonstrations and their impact with an open mind, because the increase in fees may have quietly ushered in a new era in the history of the English University institution.

Now that the fees have been implemented, it would be unbelievably difficult to reduce them once more: there would be riots over those penalised, a further reorganisation of the Student Loans Company, endless paperwork for universities to reassess its student population.

Yet, the 9k barrier doesn’t even proffer the solutions that many politicians advocated it would. A report by the Higher Education Policy Institute, a highly respected think-tank, professed that the new system was actually due to cost taxpayers more money in the long run, proclaiming the possibility of a £1billion a year black hole.

Possible ‘solutions’ only sound like fuel for fire in another possible student rebellion. Besides, can youth culture stand another such mass movement without galvanising some sort of modern 21^st century revolution?

It hardly seems as though any young adult will be pleased with either the prospect of having to pay more back on their university loans (with what money you may ask in such an economic climate with rising youth unemployment?), or satisfied with the possibility of fewer university places (the UCAS system already limits universities: how can fewer places be fairly allocated? And how will this affect overall employability prospects?). It’s hardly motivating or economy-saving stuff. What austerity drive Nick Clegg?

The Hepi report describes civil servants as having made "highly uncertain and optimistic assumptions" on funding. Findings cite that the assumption of an average net fee charged by universities would be £7,500 a year, but the true figure is nearer to £8,300, thus forcing students to borrow more. Further, questions the assumption that the average male graduate will be earning £75,000 a year in 30 years, the period by which loans have to be repaid (already a 25% reduction on earlier projections).

The higher fees regime also adds 0.2 percentage points to the Consumer Price Index – thus triggering larger rises in state benefits and civil service pensions of between £420m and £1.14bn a year.

Oh and then fees are only recuperated when graduates find employment of course. Please sort out the economy in a forward thinking manner, rather than taking a backwards approach. Jobs first; less economic turmoil. Hell, I’m an English student and this makes sense.

David Cameron and co may face a heavy backlash not only in these immediate costings, but how students approach their university careers.

Picture the scene: it’s the middle of September, I’m unpacking my boxes of student life essentials, hanging up posters of some indie band and quotes from my favourite popular comedy series. Sounds like your typical moving in day.

But no: I’m unloading everything into the dorms of a prestigious American university (college, whatever). The reason? For a much similar annual cost, I can study for my degree, whilst living in a different country, experiencing their culture, seeing many of the famous sites; from New York to Washington, Florida to Vegas. I can make contacts and friends abroad; links that can prove invaluable when searching, fruitlessly, for a job in the UK.

The appeal of this is all too apparent: students, young, free and with a world to experience, are at the first point in their lives without their parents, and that can offer a whole lot of new lifestyle choices!

Perhaps the only way to counter such a move would be the rise of private universities in the UK, which would undercut the national average cost and appear much more cost effective. But then, of course, there would be the problem of whether these institutions would deliver reputable degrees to its graduates, and whether employers would believe these universities to offer any valuable qualifications.

Essentially, the system either restricts students and the taxpayer in its costs and fees, or restricts the choice of education through conventions.

But while there are students empowered by the movement to reject 9k, and if the general public were more educated on the gaping financial hole that threatens to consume their income, there stands resolute chance for a government U-Turn.

Then again, what turmoil would that entail for the economy and public faith?

Redefining Europe?

In a historic moment, this weekend saw a new president elected in France. But this is not a simple handover from one leader to another. French politics has been shaken and the results are clear to see.

Francois Hollande received around 52% of the vote to wave Sarkozy from office. But Hollande rise to President-elect was anything but smooth: yet perhaps the most overwhelming hurdle was the inherent psychology of French citizens, apparently predisposed in favour of right-wing politicians.

Sarkozy’s Union for a Popular Movement (UPM) party was a centre right organisation, and ever since the 90s, the French presidency has exclusively belonged to the right. More so, there is only one blemish on the right’s record of power since 1958: Francois Mitterrand, who served the country as president from the 80s till the mid-90s, is the only left wing leader in more than half a century. On top of that, Sarkozy is the first French president not to have won a second term in over thirty years. Certainly, the statistics were stalked in the incumbent head-of-state’s favour.

Therefore, whilst the media may be drawing attention to numerous bits of luck on the part of the incoming president, and a multitude of misfortune on the part of the departing, there was first and foremost a seeming political allegiance, a political bond, between president and people that needed to be severed.

Perhaps the legacy of Mitterrand still holds coinage with voters in the European country. After all, Francois successfully deployed a substantial economic turnaround, made sweeping technology changes, supported various activist movements and carefully balanced the power of France within Europe and the world. His period of power produced a France that was not only one of the strongest countries at the close of the twentieth century, but in its strongest position across the century as a whole.

As such, in times of similar economic failings, a possible identity crisis and continued French resistance and demonstrations against French rulings, Hollande appears a candidate very much in touch with his people, dubbed Francois II (signifying him as the second coming of Mitterrand). Other headlines proclaim him as ‘Mr Normal’.

Indeed, French presidencies of the late twentieth century were either held by old, hardened politicians, or apparent upstarts who had rose through their party ranks too quick for sufficient experience.  Here is an elect who not only has the fine-balance of experience and youth on his side, but is so seemingly straight-forward, if not a little reserved, that he has won the French people with his honesty and genuine persona.

A front-page "Letter to Mr President" by Francois-Regis Hutin in Ouest France wishes Mr Hollande "good luck". The paper says that "we count on you to arouse the dynamism of all the French... to reconcile the French, to help overcome the split between the included and the excluded, young people and old people, town and country, workers and pensioners, rich people and poor people."

Of course, this tackles the failings that are laid at the steps of Sarkozy’s regime. He was either despised as a friend of the rich by the left, or seen as the man that broke his word by the right, or by most as the man that promised reform, began to make steps in that direction and stopped far short of completion.

These issues need be addressed by the new President for sure. His period in charge will prove pivotal certainly to the shape of the French twenty-first century, if not for the most part of the next millennia. Hollande will govern a country where, as the historian and economist Nicolas Baverez says, "By 2025, we will know if France still ranks as a leading nation in the world."

Yet despite the new appeal of Hollande’s practicality and placidness, his offer of change and consolidation, there is remarkably little difference between the centre left and centre right candidacy campaigns. The deficit will be tackled slower under Hollande, and with more dependence on taxes, but otherwise, there is not too much that would rock the boat about this leader.

His trail, though igniting people with the promise of a zero deficit by 2017, has left little impression of the long term policies and positions of the President: rather, people have been swept along with the fervour of change, the promise of Mr Normal. After all, Hollande appeared less focussed on austerity measures that were favoured by his predecessor and Merkel. And with their policies only bringing about rising unemployment and debts, the public support has suddenly dried up for their strict measures.

All that is sure of Hollande’s term is that his decisions will carve out the path of future France: either rising like the beacon of the Eiffel from the storm of the Seine, or reaffirm dwindling power that would leave French surrendering to the mercy of Germans and Britons alike for the third time in a century.

Economics Straight and True

Earlier this week, it became official that the UK was in a double dip recession; an announcement that had been softened somewhat by previous data that suggested the UK economy had once more begun to shrink.

Now there are calls for the government to alter their course of action so as to encourage growth before the new dive becomes irreversibly damaging to trade and economic prospects.

However, austerity measures already in place took some time and considerable budget planning to come into force and it is highly unlikely that a swift change of course will come by the end of the month, or summer for that matter.

No, the government will cling to a belief that whilst many other countries, both across Europe and the globe as a whole, were reassessed and had their credit ratings slashed a few months ago, Britain was spared in part thanks to these current policies.

It is no little truth. Of course, the trend of growth, strength of the sterling and increasing import/exports all had a swaying hand on the decision, but a key factor in the assessment process is the perceived overall management of a country’s finances. Fiscal priorities from Westminster over the past twenty-four months have been second to none and, whilst the hard medicine approach has drawn parallels with the unpopular measures of Thatcher, now (as then), there is still an overwhelming feeling of support for the government as they remain resolute in their course of action.

Indeed, polls at the beginning of the month, following the budget report indicated drops for the Conservative party, but these were immediate back-lash reactions and not measured voices who had considered the situation.

A situation that is, at best, precarious. Sudden shifts in strategy could in fact damage the overall economic efforts. Initial reaction to another statement of new measures would see widespread panic throughout the City that would in turn spark a weakening pound and a possible rush on banks.

Not to sound overly apocalyptic, but the trust that the public and businesses place in government policy is a fine balancing act. Even the slightest hint of disruption could threaten the stability that has slowly ebbed its way back into consumer and business life.

Moreover, with Spanish unemployment at a new high, continued Greek unrest, and further burdens on Germany as AAA lone ranger of the Eurozone, the British need to put support behind government efforts to consolidate progress so far achieved. With the costly problems facing Europe, our markets need to continue to prosper, or else both pound and euro will undoubtedly ride down the abyss together, so inherently linked are the two zones.

Whilst the budget measures are unpopular and few benefit from the changes, it would be unwise to declare the policies as inappropriate and unsuitable to the current climate. The phrase “we’re all in it together” still rings true in ears across the country: only in a resolute front of support can businesses emerge from the staggering financial crises and people become more liberal about their expenditure. Riots like last summer show the potential fragmentation that lurks underneath our society, and similar disruptions seen across mainland Europe in country’s with governments weaker than our own are testament to the need for a straight and steady course, perhaps even to protect us from ourselves.

No Day of Rest.

Over the weekend, Osborne introduced new Sunday trading laws for the duration of the London 2012 Olympic and Paralympic games.

Under the rulings, there will be no major restrictions on Sunday trading as is the norm in the UK.

The Chancellor stated that with so many hundreds of thousands of people coming to the country to enjoy the games, it would only be sensible to extend opening hours so as these people could enjoy the retail experience too.

Suspension of the Sunday trading laws is due to run for eight weekends from the 22^nd of July.

George Osborne explained his decision in a television interview, stating that “It would be a great shame - particularly when some of the big Olympic events are on Sunday - if the country had a closed for business sign on it.”

Mixed responses have followed the news, with some believing it a celebration of British retail as defined by Westfield shopping complex, whereas others bemoan the legislation as detracting from the small, unique and diverse independent shops that London has to offer.

Relaxing the Sunday trading law is something to be concerned about, however. Mr Osborne also described the scheme as an ‘experiment’ from which the government ‘could learn things about trading’. There is growing belief, with rumours from inside parliament, that should the Olympic trading prove successful, then the laws could be scrapped completely.

Whilst this offers extra hours of retail for large companies, it does not vastly improve lifestyles for those in the UK.

Increased trading hours means that more people will have to be contracted to work Sundays. This will restrict relaxation time available in the weekend, both on personal and familial levels. With more people expected to be in work, there could be in fact a general reduction of shoppers, with people not wanting to spend extra time away from families and other activities, but the Olympics would mask this due to it being an anomaly event.

With no consultation on the matter, longer hours are bound to cause some disruption, but are already being assessed as a long-term plan by the government.

Comparing with European counterpart France, people are either lucky or in suburban Paris should their supermarkets and chains open more than 12 hours in a day; Sunday trading is even rarer. This thought is poignant as the 2012 Olympic bid finalists were London and Paris. France would not relax its laws for the Olympics, especially when they are cultural and religious. The nation just across the channel rests on nationalism and a sense of a day of rest for all.

The UK, however, has lost this perspective and continues to back longer hours and less respite time. Concerns have shifted from the personal and wellbeing, to material and capitalist gains. Only in reversing this trend can we see an increased national satisfaction. Happiness doesn’t come from shops, but in our time spent together.

Downgraded European Economies is a Punishment for Germany.

As the Eiffel Tower sits overlooking the Seine in the centre of Europe’s capital of love, it appears that Standard and Poor, the international credit rating agency, have fallen out of love with the French capital.  

Downgrading of nine European Union economies last week did not come as a surprise, per se, but remained a bitter blow, especially to the second largest Eurozone economy. Rating changes for nine countries highlights the need for new austerity measures, before introducing growth plans.

Perhaps this is the reason Britain remains unchanged in S&P’s poll: Cameron’s government moved quickly to introduce cuts and the fact that these measures have been undertaken without direction has been rewarded from the worldwide monetary agency.

Without doubt, Britain’s position is far from safe: while the short term consequences see a gain in GBP strength and trade prospects on an international scale, the intrinsically linked economies of Europe are a fragile set of dominos. A single collapse at this stage of the crisis could prove the kindling for an explosive series of economic shortcomings and bailouts.

Indeed, plans introduced to cancel 70% of Greece’s debt last Friday are but moves to buy time for the Euro and all related economies.

Whilst it is believed the move may help Greece to start to implement new means of recovery that will slowly abate the spread of financial interdependence, the wiping of such an astronomical figure from the central funds of Europe is equivalent to pulling the plug on a vast resource of wealth. With fewer countries classified AAA, the missing money could prove to be nigh on impossible to replace, meaning that it would undermine the significant advances made in industry over 2011.

Should such an econopocalyptic event pass, it is likely to trigger debt that cannot be undone within our lifetimes.

France’s image as one half of the economic megaforce upholding the Eurozone has now been shattered. Sarkozy’s right to stand on a podium alongside Merkel has been removed: former foes had been presenting a united front as the 17 countries that use the euro face their biggest crisis since World War II. Now, whilst a blow for the president, concerns should shift from where France went wrong to where Germany now finds itself.

Economically, Germany is on the precipice before the abyss. All of Europe looks to its €211 billion ($267.32 billion) contribution to the Eurozone rescue fund as a source of saviour. Although Luxembourg, Finland and the Netherlands all maintain their AAA rating in addition to Germany, the mother of the Rhineland is able to boast a donation to the Eurofund that is more than treble that of the other three combined.

Germany is once again isolated in the centre of countries that threaten it: no longer the supposed threat of invasion, but the threat of siphoning all the funds possible for ulterior economic issues.

Relative strengths and weaknesses of key economies have been realigned by the changes and Germany becomes more vulnerable to credit crisis the more that its own funds are charged with the duty not only of small periphery nations, such as Greece and Portugal, but large central blocs, as France and Italy.

Any increase in bailout costs comes from German pockets and this appears to be something that the German electorate may not bear with merely a customary grumble too much longer. This could lead to potential referendums on the amount Germany puts into the fund, or even on the Euro itself.

However, the cost of breaking up the Eurozone itself could be catastrophic as billions of Euros are lost in every area from trade to administration and all problems in between. In fact, the relative weakness of the surrounding economies at least makes German products more competitive, which means Berlin earns more capital.

All the same, the opinion of the voter would depend on the projection of their outlook. Germany, likely to reassert itself as the strongest economy before European counterparts could still see benefits from a break in the single unit currency within a decade or two. Markets would always seek the hub of enterprise and exports offered by the central state.

The risks of both cases are, unfortunately, war. Ironically, the Franco-German alliance now enters a turbulent stage wherein the two countries sit on the crux of imposing a disaster on the rest of the economy, continent and world.

Should Germany continue to support its Eurozone counterparts, there may emerge a sentiment of anger and resentment that would see a war break out due to a lack of appeasement. On the other hand, if Germany were to break its ties, it could grow strong amidst a state of turmoil and seek further expansion in order to capitalise on new found economic prospects. And who could say that such a route would be devastating – the application of German stratagems could provide economic balance further than its current boundaries. Or should Germany leave, other European countries may feel abandoned and declare action as a last ditch effort to prove their own flailing might in the face of German capitalist gains.

After all, one of the main contributing factors of the Second World War was the sheer amount of economic wealth that was drained from Germany by other European countries. But then, when have we ever learnt from history?

Sparkling over the night waters of the Seine, the Eiffel Tower appears an oversized, abandoned Christmas decoration, spreading little warmth to the heart of Paris, threatening to be washed away by the tide of debt on which it is founded.

Delors Created A Monster: The Euro Currency.

In economic downturn, any politician’s own trivial punch at the current state of the financial crisis can really knock confidence and cause extra downturn and problems.

But this has not phased Jacques Delors, one of the main architects of the single European currency, the Euro. Perhaps his honesty is the wake up call needed for future generations to never again be so flippant in their approach to international banking and funds. Perhaps it’s just a last jibe: an “I told you so” move that satisfies no one but himself.

However, the politician spoke out last week, stating “The Eurozone was flawed from the beginning”.

These are no doubt so bold and troubling words, at a time when the Eurozone has never looked so increasingly fragile. More countries turn to the Markozy central block for loans and bailout plans in an web of dependency that is surely already too far stretched. With other key members such as Spain and Italy, not thought of as in danger until quite recently, defaulting, there is a huge lack of faith in the value of the Euro, and its shared unit only serves to weaken those central powerhouses further.

Why the sudden backlash from Delors? As head of the European Commission from 1985 to 1995, he played a key role in the process that launched the euro and his comments effectively bring about questions of its true validity.

Delors claims that the single unit is not itself at fault, but “a fault in execution” by those who saw its implementation, who did not consider the economic backgrounds of certain member states. He continued by adding that “the finance ministers did not want to see anything disagreeable” and so instead of focussing on kinks of the single currency, they blindly promoted its benefits regardless.

Perhaps his most poignant move is to admit that those, like the British, who objected to the Euro certainly “had a point.”

In fact, a jump (or at least jump by today’s variable standard) was seen in the pound vs the Euro trading after this admission was made. Trade rendered £1 worth €1.17-€1.18. Not that this necessarily signals a growing strength in the pound, but rather a worse Euro. And Britain should remain wary of this, for its markets are key traders in the Euro currency. Our own economic growth is dependent on the fiscal balance sheets of Europe, even if we like to disagree.

On Friday, German Chancellor Angela Merkel said Europe was working towards setting up a "fiscal union", in an effort to impose budget discipline by members.

Yet, this surely would have been a logical launch issue? In some regards, it seems the lax approach to the Eurozone was deliberate, creating a free for all market, wherein all countries could reap the rewards. Bearing the consequence was never at the forefront of decision making.

And if the Euro should collapse, where will blame rest? With the French and German governments who prop and support and continue to make crucial decisions for the future of their economies? With the lesser countries who added to the imbalance of outgoing money? With the lack of a central union from the beginning?

Delors doesn’t have a definite answer, but sees all the moves of leading parties as “too little, too late”. But then is this the fault of Delors in his initial approach to the Euro itself? The history books will decide.

Autumn Statement Readjusts Economic Vision.

Amidst continuing economic misery and the prospects of further strike action, the Autumn report from George Osborne was quite the focal point of the week inside parliament, no matter what happened throughout the rest of the capital and the country.

With repeated promises of grand strategies and new hope, PM David Cameron has made several hints in recent interviews that this would be an announcement which would once again set Britain along the path to recovery and financial stability.

As expected, the statement did little to improve positivity, yet it is difficult to deduce how far there are failings in this report or its predecessor.

Shadow chancellor, Ed Balls, reacted to the speech by declaring Osborne’s plan was in tatters and concluded that it had been “a colossal failure”. And whilst the announcements in the House of Commons were far from a success, a colossal failure appears somewhat extreme a branding.

A shift in direction has been long overdue: and by employing such a course of action, the current government may have been able to steer clear of certain failings that are current plaguing the Eurozone dominated by Merkozy.  

Indeed, as expected and reported heavily on earlier in the year, forecasts have shrunk and growth is expected to be minimal for the coming two years (which is all the more concerning considering the Olympic Games should provide a boost that is not at all evident in the statistics). Add to this the fact that instead of reducing the deficit, the government is set to borrow an extra £111bn over the course of four years: a projector that means it will have spent more than Darling did previously.

However, it is difficult to condemn the move as liberally as Balls challenged. Without a change in tact, there would have been serious risk of falling into the Eurozone problems of cuts vs stability.

No doubt, the balance between the two is difficult to attain, but this statement goes some way to redress the issue. Money has been released for key areas of growth: infrastructures such as motorways, rail systems and housing complexes all benefit as well as several key industries. The idea is to promote growth that will outlive excessive government spending. By starting the process, it is hoped a momentum of trade and commerce will begin to build and the government can gradually ease spending.

So whilst this means a temporary boost in spending, it remains the long term objective to reduce the deficit. It is interesting that the government has now altered its plans so as they appear a mix of election policies from Labour and the Conservative. Whilst the advocation of more spending is present, there are still harsher cuts.

Whilst the Chancellor accepts that this method actually means more pain now and more pain for longer, it appears that he has chosen this revised plan because, in fact, it will move at a gradual and steady pace: without sudden shifts, confidence will once again overwhelm markets as long as they continue to show signs of future prosperity.

In his retorts, Mr Osborne pointed out that Labour is the only mainstream party in Europe promoting spending extra money. Moreover, Mr Balls’ statements appeared somewhat unfounded as he said the deficit was still too high and yet more needed to be spent.   

      

 His comments, whilst sweeping, could in fact be a sign that this is a move that could save the current government and win them an extra term in office come 2015. There are certainly times of austerity ahead, but economic collapse here seems slightly more distant than it does in centralised Europe… at least for now. 

George Osborne's report at a glance (BBC)