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Germany criticises 'crass' economic rescue plans

(Agencies)
Updated: 2008-12-11 11:43

Leaders of Britain, France and the European Commission met in London on Monday to present a united front on a 200 billion euro economic stimulus package for the EU, but Germany was left out of the talks.

European Commission President Jose Manuel Barroso, right, French and current European Union President Nicolas Sarkozy, left, and British Prime Minister Gordon Brown meet inside 10 Downing Street in London, Monday Dec, 8, 2008, before a summit with European business leaders to discuss the global economy. [Agencies]

European leaders are due to meet in Brussels on Thursday and Friday to discuss the proposal.

Asked what was wrong with stimulus proposals that some countries had already put forward, Steinbrueck was highly critical of Britain's plans to inject record sums of money into its economy.

"Our British friends are now cutting their value added (sales) tax," he said.

"We have no idea how much of that stores will pass on to customers ... All this will do is raise Britain's debt to a level that will take a whole generation to work off."

Keynesianism is based on the theories of British economist John Maynard Keynes, notably the use of government spending and low interest rates to stimulate demand during a recession.

Steinbrueck said people were naturally nervous about the financial crisis but that he wanted to give Germany's own 31 billion euro stimulus package time to succeed.

"As long as we haven't even given that a chance to work, I am not going to participate in this bidding war over who can do the most. I try to exude a little steadiness and continuity instead," he said.

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