| Topic: | Re:Re:The False Economy...brought to you by all Governments... | |
| Posted by: | Alan Clark | |
| Date/Time: | 09/12/10 13:51:00 |
| Read John Lanchester's book 'whoops' for a pretty good overview of the background to the current economic crisis and the reasons for governments everywhere acting the way the are doing. In short, we have a capitalist economic model and this model demands the role of financial institutes to provide funding and to enable movements of cash. This includes providing loans and funding to governments - and the cost of this is determined by the credit rating of the country. To maintain good credit rating the government has to be seen to act in a way that confirmed prudent and strict fiscal manageement. Not demonstrating this means the credit rating is likely to be reduced. That's the model, so that's why you get cuts. |