King rains on Brown's parade
Peter Hoskin 7:39pm
An intriguing little story in the FT about the worsening relations between Gordon Brown and Mervyn King. Apparently, our Dear Leader doesn't like the downbeat rhetoric that the Governor of the Bank of England is deploying:
"There is growing irritation in Downing Street and the Treasury towards Mr King. The prime minister and Alistair Darling, chancellor, have been left fuming by the governor’s interventions, most notably after his downbeat assessment this month of the economic outlook, a viewpoint pounced on by the Conservatives.Although Mr King’s forecasts were broadly similar to those set out by Mr Darling in last month’s Budget, the governor’s gloom-laden press conference at the launch of the central bank’s latest quarterly inflation report was watched with dismay in government circles.
'If you’d watched Mervyn on the news you’d have thought the world was a terrible place,' said one official in the Brown administration. Another talked of barely disguised dislike between the prime minister and governor when they met.
...
Mr Brown has been advised by US president Barack Obama’s campaign team – now working for Labour – that he must fight the next election with an optimistic outlook, contrasting with Tory leader David Cameron’s rhetoric on the need for 'an age of austerity'.
Neither Mr Brown nor Mr Darling suspects party political motives but they believe the governor’s willingness to speak out and what they see as his occasional naivety are playing into Tory hands."
Given this Government's track record on forecasts, as well as some of the worrying indicators coming out at the moment - not least the Standard & Poor revelation - I don't think it's too unreasonable for King to take a sober view of things. In which case, this becomes a telling sign of how Gordo likes his independent bodies: erm, toeing the Labour party line, and helping in the great struggle against the Tories. And it's rather dispiriting if he's letting these party poltical instincts damage relations with the Bank of England at a time of economic crisis.
As for the Tories, their rhetoric may be about to get even more cheerless. One of George Osborne's favourite economists (whom he referenced here) warned today that Britain could face two recessions in quick succession. Seems like gloomy ol' King may be onto something...
Previous
Josh
May 23rd, 2009 9:39pm Report this commentWell, considering Mervyn King is one of the most gifted and eloquent economists in the world, and that he voted for interest rate rises in 2004 and 2005 when the rest of the MPC took a ''doveish'' stance, I trust him over Gordo any day of the week. I have a hell of a lot of respect for Mervyn King.
Nicholas
May 23rd, 2009 9:54pm Report this commentI think it is an absolute disgrace, if true, that Obama's campaign team are interfering in British politics to bolster the odious Brown.
And how are they being remunerated? I think we should know. Is this a gift from the socialist President or is it lend-lease?
strapworld
May 23rd, 2009 10:54pm Report this commentObama's team helping Brown?
Obama should be sent a friendly note from Cameron asking if he would have liked a foreign state helping the republicans?
And Cameron should hint that he will bring back our troops from Afghanistan if he carries on with this assistance.
The americans view everyone as americans! they have no idea whatsoever! They are absolutely useless at judging the British. Mark my words.
J.Wright
May 23rd, 2009 11:06pm Report this commentI find it extremely disturbing that Obamas campagne manager is now working here to win the next election for Brown. There should be some Law against this gross interference,,not that the laws of this country stop this Corrupt government.Isuppose the quid pro quo is the british squaddies fighting and dying in afganistan to reelect Brown.Joanna you havent finished yet!!!.
chris
May 23rd, 2009 11:18pm Report this commentLooking and acting more like Brezhnev every day. He cannot handle dissenting views or any opposition. Shame on the Labour Party for giving this odious man a chance to lead the nation.
Stephen
May 23rd, 2009 11:25pm Report this commentSurely, privately, the Governor would be pleased to see a Conservative government? Perhaps his 'occasional naivety' is really subtle politicking. It is revealing to know that 'Mr King’s forecasts were broadly similar to those set out by Mr Darling in last month’s Budget'. I had thought, from the press coverage that Darling's forecasts were hopelessly optimistic.
As for George Osbourne, didn't Mrs Thatcher describe his 'even more cheerless' line as 'doing down Great Britain'? I'm not suggesting that King or Osbourne are wrong. But I am suggesting that a little bit of consistency in our attitudes would avoid the charge that we are spinning the facts to suit us. After the fashion of the previous PM.
mckenzie
May 23rd, 2009 11:32pm Report this commentHave MP's suddenly regained moral authority, or is it me being paranoid about the Spectator's natural gift for making shit smell like roses?
Austin Barry
May 23rd, 2009 11:52pm Report this commentSo the preposterous Brown is told by his American advisers that he must fight the next election with an optimistic outlook? Have they met him? He doesn't do optimism. He has all the humourless, charmless gloom and despondency of the 'before' man in a laxative ad. Better try a new tack, guys.
Frank O'Connell
May 24th, 2009 7:11am Report this commentIn yesterday's Fleet Street Letter.
Lord Rees- Mogg says''King's perverse forecast deserves respect''
Frank O'Connell
May 24th, 2009 7:19am Report this commentRe Margaret Thatchers favourite economists-The Austranian School.
I urge all readers to buy a copy of Meltdown by Thomas E Woods Jnr.
How can one of Obama's team help our country when they are making matters worse.
Pete Hoskin
May 24th, 2009 7:39am Report this commentmckenzie: erm, what do you mean? I can't see how I'm making anything smell like roses in the post above. Is it because it's not about the expenses scandal?
Nicholas
May 24th, 2009 10:20am Report this commentGreat profile shot of McDoom in that photo. Stubborness. Wilfulness. Arrogance. Mean little mouth. Piggy eyes. Lends itself to being painted on a wall with the legend "Viva Il Duce!!!" underneath it. He would need to wear a fetching steel helmet though.
Sic Semper Tyrannus.
Austin Barry
May 24th, 2009 1:14pm Report this commentNicholas
Spot on. Brown's profile resembles that of Bertelli's 'Profilo Continuo' (Head of Mussolini) in the War Museum. Transmigration of the soul anyone?
Verity
May 24th, 2009 2:38pm Report this commentAustin Barry - a great post, as usual!
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