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| Economy |
| Czech PM: US bailout 'way to hell' |
| 2009-03-26 |
| Mirek Topolanek, the Czech prime minister, has described the United States' stimulus packages as a "way to hell", one week before he is due to meet Barack Obama, the US president, at the G20 summit. Topolanek, whose country holds the European Union presidency, told the bloc's parliament in Strasbourg that Obama's plans to stimulate the US economy would "undermine the stability of the global financial market". His comments, which come a day after the Czech government collapsed after a no-confidence vote in parliament, highlight growing differences between the EU and Washington on how to deal with the global economic crisis. Several European leaders, including Nicolas Sarkozy, the French president and Angela Merkel, the German chancellor, are in favour of tighter financial regulation, while the US is pushing for larger economic stimulus packages. Referring to Obama's high-spend plans to lift his country out of recession, Topolanek said: "The United States did not take the right path. All of these steps, these combinations and permanency is the way to hell. We need to read the history books and the lessons of history and the biggest success of the [EU] is the refusal to go this way". The US plans to pump $1trillion into its financial system by buying up treasury assets and mortgage securities, along with a $787bn economic stimulus package of tax rebates, health and welfare benefits. But many EU leaders have urged member states to exercise fiscal restraint on government spending, rejecting calls from the US for more stimulus deals. There is speculation that the contrast between European and US economic policies could come to a head at the G20 summit in London next week. Obama has insisted that his massive budget proposal is moving the nation down the right path and will help the struggling economy grow again. Gordon Brown, the British prime minister and host of the conference, is unlikely to add to the number of critics, after praising Obama for his willingness to work with Europe on reforming the global economy. On Tuesday, Mervyn King, the governor of the Bank of England, cautioned Brown against further significant government spending to stimulate the economy. |
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