I always suspected that when Osborne paid out all our cash to the IMF that sooner or later they’d be back for more. The problem is that far too many countries out there who have gotten themselves into financial problems have simply taken the IMF money and not cut back on their spending by any sort of sane amount to get their finances into the black. Hence various EU countries credit status being downgraded last week.
BRITAIN is facing an extra £17.5billion bill to help prop up the eurozone as the International Monetary Fund looks to boost its debt fund to $1trillion.
As unemployment figures in the UK hit a 17-year-high, the IMF announced that it was set to raise its debt fund to $1trillion in a bid to rescue the eurozone.
International Monetary Fund manager Christine Lagarde said yesterday that she was looking at ways to ‘increase its financial firepower to deal with Europe’s debt crisis.
In a speech at the Washington State Department, she said that if Europe’s debt crisis wasn’t resolved, the world economy could face rising protectionism and isolationism.
The rise in the amount given by Britain will force Chancellor George Osborne to ask parliament for permission for the extra £7.5billion.
Britain has already set aside £30billion to the fund with an extra £10billion contingency.
Thing that always gets me is that this is money we could be using to stimulate our own economy, particularly at the expense of our overspending EU partners. The problem is, that Europe’s debt crisis will not be resolved by giving them money, but by them stopping spending the money that they don’t have. It’s a bit like alcoholics and drink, you don’t get an alcoholic to stop by buying in another round, you stop them by removing access to booze.
Yes the end of the Euro and the collapse of the Eurozone will be a terrible thing, but the entire situation has now gone far too far for anyone to stop it, it has the inevitability of a steamroller running over a snail. The time to have sorted out the flaws in the Eurozone system was before it came into being. Not during it’s Götterdämmerung stage.
What the IMF are proposing to do is throw good money after bad, perhaps it’s time to let the financial institutions which caused the damage pay the penalty. Crops will still be grown and goods made, other means of finance will come into being. Perhaps even a few politicians, lawyers and banker will be hung for good measure.
But it will happen, there’s no way to stop it now and grabbing more of our cash will not help save to make the inevitable even worse.