The FT’s Martin Wolf is scathing about the European Central Bank’s policies before turning on the UK government:
...the panic that justified the UK coalition government’s turn to a long-term programme of austerity was a mistake. Had its members never heard of the paradox of thrift? If the domestic private and external sectors are retrenching, the public sector cannot expect to succeed in doing so, however hard it tries, unless it is willing to drive the economy into a far bigger slump. While short-term factors have played a real part, it is not surprising that the UK’s recovery has stalled and the deficit is so persistent. It is consequently also not surprising that downgrades are on the way, not that these tell one anything very useful in the case of an issuer with access to its own money-printing machine.Wolf concludes:
In the long run, the fiscal deficit must close. In the short run, the UK has the chance to push growth. It should take it. So should the US.