French President Nicolas Sarkozy Blames Gordon Brown For Economic Crisis
In what's becoming a popular trend these days, another world leader is accusing Gordon Brown for ruining the economy. This time, it's French President Nicolas Sarkozy pointing the finger.
Back in November, Gordon Brown instituted a stimulus plan that cut England's VAT (sales tax) by 2.5. He reasoned that it gave people an incentive to go buy since they would be seeing savings right away.
President Sarkozy has been facing his own economic crisis in France, and has been asked whether he would consider cutting VAT as well. He thinks it's a foolish plan and explained why:
"The reason is simple: because it's in people's heads. If the consumer no longer consumes, he won't change just because we add or subtract one VAT point, it's because he's scared for his future, he's scared for his job and says to himself: 'I must save, because bad times are coming.'"
He added that since Brown's VAT reduction, "Not only has consumption in England not gone up, it continues to go down. Gordon Brown cannot do what I am doing with carmakers [giving them up to 6 billion euros]... in construction and other industries, because they haven't got any left."
Another problem with the VAT cut is that it only affects big-ticket items like cars and large appliances, not everyday things like groceries and gasoline. Who in their right mind goes out and buys a new car when they don't even know if they'll be employed in one week?
It's an asinine plan, and the rest of the world agrees.
Shadow chancellor George Osborne said: "President Sarkozy is the latest international leader to condemn Gordon Brown's main policy for tackling the recession. We said at the time that Brown's flagship VAT cut would only make things worse and would be an expensive failure. Gordon Brown claims to have saved the world. It would appear that world leaders increasingly disagree."
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