EU Governments Could Hardly Have Managed Greece Worse
THE WALL STREET JOURNAL: With the IMF and euro-zone governments finalizing the debt-rescue package for Greece, there is almost unanimous agreement on one thing: European governments could hardly have managed it worse if they had tried.

"The Greek crisis has been so severely mishandled by European policy makers that the markets legitimately fear that matters are now beyond repair," argues Alessandro Leipold, a former acting director of the International Monetary Fund's European Department.

Here's another verdict that explicitly links Europe's handling of the crisis with heavy costs for Greece and possibly for the entire euro zone. "The fractious nature of the [European] assistance has likely created permanent damage. Debt will likely stabilize at a higher amount and at a higher economic and social cost than previously expected," Moody's said in a report this week.

There is cold comfort for governments seeking a European solution to a European problem in the knowledge that the institution monitoring Greece's rescue is run by a European. The European in question is IMF managing director Dominique Strauss-Kahn, whose office is in Washington.

The lessons from sovereign debt crises over 30 years suggest they will intensify until the financial markets are confronted with evidence that leads to a sharp shift in investor expectations. If a bailout is being contrived to change those expectations, it needs to meet several conditions. >>> Stephen Fidler | Friday, April 30, 2010

Gordon Brown's 'Costs of Failure' Will Reach £256 Billion
Isn’t it high time we kicked this fiscally imprudent government out of office? Gordon Brown and his inner circle have shown us just how totally incompetent they are.

It is going to take us Brits years to get ourselves out of the mess that this Labour government, and Blair’s, have got us into. Shameful politics! Shameful economics! – © Mark

THE TELEGRAPH: Social security payments will cost almost £200 billion in four years time, accounting for one pound in every four that the Government spends.

Combined with a debt interest bill of more than £63 billion, items Gordon Brown once called “the costs of failure” will absorb more than a third of all Government spending.

Leaked Treasury documents have revealed the Government’s own bleak forecasts for rising welfare payments and debt interest costs.

The figures, which were not revealed in this year’s Budget, show the scale of the damage that will done to the public finances by rising unemployment and the soaring national debt.

The papers show that the Treasury expects to pay out £193.4 billion on social security benefits in 2013/14. Paying interest on the Government’s outstanding debts will cost £63.4 billion.

Total Government spending in the same year will be £758.3 billion. Welfare and debt interest will be 33.8 per cent of that total.

Around 6 million people in Britain are estimated to claim some sort of employment-based benefits, and the figure is set to rise.

Official figures released on Wednesday showed that unemployment reached has 2.47 million, the highest since 1995. Most economists expect the total to peak at around 3 million early next year.

In his 2000 Budget, Mr Brown described money spent on debt and welfare as “the costs of failure” and lauded Labour’s record in reducing those payments.

He said: "Our promise was to reduce the costs of failure – the bills for unemployment and debt interest – in order to reallocate money to the key public services."

Now, Mr Brown’s own figures reveal how those costs are set to grow dramatically. >>> James Kirkup, Political Correspondent | Wednesday, September 16, 2009

Former Chancellor Geoffrey Howe Attacks Gordon Brown
THE TELEGRAPH: Former Conservative Chancellor Lord Geoffrey Howe has said Britain could be headed for depression as a result of Gordon Brown's economic mismanagement


Lord Howe, who was Chancellor between 1979 and 1983, said the economy was "very badly managed" under Mr Brown's Chancellorship and a lack of fiscal prudence stripped Britain of readiness to face the "crisis" sweeping world economies.

"I think the recession is going to be deeper than it is now, almost every day we get news that underlines that. It's probably moving towards a depression, and the British economy has been so mismanaged that it is very ill prepared for it," he told Telegraph TV.

Lord Howe said Mr Brown is personally responsible for the fate of the economy. "Gordon Brown believes he has been working economic miracles during his ten years as Chancellor, we've all heard him saying it is the end of boom and bust... and we are at the threshold of a golden age, but that is miles from the truth." >>> By Robert Miller and Rupert Neate | November 28, 2008

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