Lord Mandelson contemplating recovery package for car makers
Car manufacturers in UK are on the verge of a state led bailout with news that Lord Mandelson is considering financial assistance to ensure the industry remains competitive and stable. However, the signals from the government have been very mixed of late with suggestions that the car manufacturers could not depend upon a state led bailout although more recent comments would indicate there is something on the cards.
The bailout package will be worth billions of pounds and dismay taxpayers who have already seen UK debt balloon by over £500 million and it looks as if the government is not finished yet. If these rescue packages and fiscal stimulus programs do not work then there is literally nothing else that the UK government can do and the UK economy will need to work through the ongoing recession which could, according to many observers, develop into a full-blown depression and deflationary environment.
The government is currently in a very tricky situation with the need to be seen to be doing something to assist struggling businesses yet the need to ensure that taxpayer funding is protected and potential returns on investment funds are possible. Whether this will actually filter through in the end remains to be seen but some brave decisions have been made and Gordon Brown is literally putting his neck on the line.
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