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Commentary

Going West?

Unable to pay its debts without borrowing more, the credit rating of the US was downgraded in August, triggering a fall of financial markets across the world.

John Benton

It is as yet unclear how severe the consequences will be for the world economy. But this was a calamity waiting to happen. Back in 2007, EN reviewed the book Black Mass by John Grey of the LSE. It said: ‘The US is unable to live on its own economic activity and must be subsidised … at present cruising speed that subsidy amounts to $1.4 billion a day’. Obviously unsustainable. Since then we have witnessed the worldwide credit crunch, the introduction of stringent austerity measures in Britain and now deep financial troubles in the Eurozone.