Bank of England report is "further blow" to Chancellor's credibility

George Osborne has described the Bank of England's latest quarterly inflation report as a "further blow to the credibility of the Chancellor and the honesty of the Budget."

The report predicts a "slow and protracted" economic recovery - and George stressed that this supports the Conservative position on Alistair Darling's Budget predictions.

"From the moment the Budget was announced, we Conservatives have questioned the Government's forecast that there will be a rapid return to boom time levels of growth."

George warned that the model of economic growth is "fundamentally broken" - and he stressed, "We cannot have a sustainable recovery until we have a Government that understands that."

Death of Ian Tomlinson: did police "kettling" of demonstrators contribute to death of innocent man?

Jenny Jones, the Metropolitan Police Authority member who has formally complained over police tactics during the G20 demonstrations, has spoken out again today (1).

Ms Jones, a Green Party member of the London Assembly and her party's spokesperson on home affairs, said today:

"I'm very concerned about reports gradually coming out about the death of Ian Tomlinson.

"He appears to have been an innocent man. Did he get caught up in attempts by police and dog handlers to clear this area? Are the reports that he fell while being chased by police true?

"And did the policy of 'kettling' demonstrators contribute to his death?"

She continued: "I will also be seeking reassurances from the Commissioner that there will be no possibility of collusion amongst police officers over statements regarding his death and the IPCC iinvestigation. This was one of the recommendations from the IPCC following the Jean Charles inquiry."

**Eyewitness to death of Ian Tomlinson**

Meanwhile reports have continued to come in to the Green Party's central office from party members who were at the demonstration - including a report from a Manchester Green who watched as Ian Tomlinson died (2). Gayle O'Donovan said today:

"The behaviour of the police was the worst I have seen on any demonstration. Late in the evening we got a call from a friend trapped in the police cordon outside the Bank of England. He had been there for several hours in the heat with no water after receiving a head injury. We were concerned for our friend and others trapped in these conditions. We wanted to bring them water but the police, for reasons best known to themselves, would not allow us to give it out.

"A few minutes later we crossed the road and saw several medics begin CPR on a man lying on the ground. We later found out this to be Mr Tomlinson, the man who died. I certainly didn't see any of the paramedics being pelted with bottles or stones, as was reported by the police.

"It was later divulged that Mr Tomlinson was on his way home from work and probably not a protester. I believe he most likely became trapped due to police tactics on the day. The police were indiscriminate about who they corraled. They shut off an area trapping everyone inside. Parents and children, the elderly and passers-by can often get caught up."

Ms O'Donovan concluded, "The tactic's known as 'kettling' because of the effect it has on those enclosed - basically it raises the temperature and makes an outbreak of anger far more likely. It is a dangerous tactic that I think must now be investigated."

The Government is in open disagreement with the Bank of England

At Prime Minister’s Questions, William Hague repeatedly asked Harriet Harman whether Labour agreed with Mervyn King that Britain cannot afford another fiscal expansion.

William described the intervention from Mr. King, the Governor of the Bank of England, as “exceptional and extraordinary”, and stressed it was a “defining moment” in Labour’s handling of the recession.

He highlighted criticism of Labour’s plans for another fiscal stimulus from the CBI, the ITEM Club and the Chief Executive of the Audit Club, as well as from Mr. King.

And when Harriet Harman refused to confirm whether or not the Government agreed with the Governor of the Bank of England, William said:

“The nation will rightly conclude that this Government are in open disagreement with the Bank of England and are no longer in control either of the public finances or the policies of this country.”

Government Betrays Public Over Banking, Just Like That!

I just saw a report on BBC News 24 that claimed that the government is pushing ahead with new legislation that will allow the Bank of England and FSA to move quicker if banks get themselves into trouble to bail them out...Hoorah! The new legislation will also help consumers to access their money quicker if things go belly-up...Hoorah!

I cannot find much on the web about this yet but there are two things that really worried me about this proposed legislation. The first is that it allows for an assumption that it doesn't seem to be possible or desirable for the government to regulate and monitor the banks closely enough to prevent them from getting into trouble again, thus eliminating the risk of institutional or systemic failure altogether.

Secondly, because the legislation will allow the regulators to react to trouble in secrecy, without the gaze and scrutiny of the public, we are not going to know what's happening in the financial services industry at all until presumably well after the event. This would remove any remaining shred of transparency in the banking system and would ultimately remove any control we have over our own money. One could also draw the inference that the government is of the opinion that it is in fact a panicky public that caused the banking crisis rather than poorly regulated bankers who were allowed to play recklessly with investors money.

So...in a cynical attempt to be seen to be doing something constructive to re-regulate the banks, the government has shown its disregard and trust in the British public by inadvertently blaming them for the downfall of the banks and barring them from full and timely information. They are also it appears going beyond their power by removing the choice and control the public has over its money and where they put it by allowing the regulators to act in secrecy. Call me crazy...but that really makes me angry! When will this madness end?