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Friday, 20 March 2009

Great stuff from Merkel

Chancellor Angela Merkel said yesterday that Germany had done enough to boost its economy, and told the rest of the world "A competition to outdo each other with promises will not calm the situation".

Indeed, she and others have said that they won't support new global regulators, presumably on the basis that most of the failed regulation occurred in the US and the UK, not the rest of the world, and as I mentioned before, the IMF is seen in Europe as a tool of American policy whereas the existing talking shop for central banks, the BIS, is more open to European influence.

So all that leaves Brown with is a commitment to double the funding to the IMF to bail out poorer nations. Not that that was ever the source of the problems in the rest of the world.

So there, Gordon Brown. It looks like you won’t get the rest of the world falling in behind you at the G20 summit with your plan to spend, spend, spend plan, so you will be left on your own. Your problem is that now when that plan fails, you will have no plan B and you won' be able tot say, “Look we did the same as everybody else, but sadly it didn’t work here”.

Do you want a clue? Germany still has a diversified economy with a strong, advanced industrial base. You haven’t got a clue how to make that happen here, because mostly it happens because it depends on knowledgeable and competent people in government who know and how when to support industry and when to leave well alone. The Germans do that well. You, the DTI/BERR, Treasury and every other bureaucrat in this country do not.

So good for Angela Merkel, not enough to get e cheering for Germany in the World Cup, but still good.

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