:00:09. > :00:12.The man who thought he could defend his country's values by murdering
:00:12. > :00:16.its children is in solitary confinement tonight. The terrorist
:00:16. > :00:21.wasn't a bearded Islamic fundamentalist, but a clean-cut
:00:21. > :00:25.young man with fair hair. Steve Rosenberg has been watching as the
:00:25. > :00:28.people of Norway remember his victims and comfort each other.
:00:28. > :00:33.His methods have been condemned by the Norwegian authorities and the
:00:33. > :00:37.public, but how deep is nationalist sentiment here and across Europe.
:00:37. > :00:43.Newsnight has discovered claim from a member of the English Defence
:00:43. > :00:48.League, who says Anders Behring Breivik went on an EDL demo only
:00:48. > :00:53.last year. Their leader, Stephen Lennon is here to explain.
:00:53. > :00:57.It is said they couldn't agree how to solve a Rubik's Cube, where all
:00:57. > :01:02.the squares are the same colour, is there any chance of Barack Obama
:01:02. > :01:07.and Congress solving the American budget crisis. Peter Mandelson
:01:07. > :01:13.admits the Labour Government got some things wrong. That is not true,
:01:13. > :01:18.you are exaggerating, as they say, to make a point. REPORTER: I'm
:01:18. > :01:22.slightly right aren't I? You are only very slightly right. Live
:01:22. > :01:32.without deviation and repetition, he will tell us what they should do
:01:32. > :01:33.
:01:33. > :01:36.There were 100,000 or more people on the streets of Oslo this evening,
:01:36. > :01:42.demonstrating their support for the 76 people who were murdered by a
:01:42. > :01:46.gunman, who claimed to be defending Europe from cultural Marxism, and
:01:46. > :01:50.an Islamic takeover. The alleged killer, Anders Behring Breivik, has
:01:50. > :01:53.been remanded in solitary confinement, while police
:01:53. > :01:57.investigate his links to far right groups. The central question
:01:57. > :02:02.remains, was this the action of a solitary deranged individual, or do
:02:02. > :02:06.his actions reflect a wider unease both in Norway and perhaps beyond,
:02:06. > :02:14.about immigration and asylum-seeker, which people like Breivik can
:02:14. > :02:23.exploit. Steve Rosenberg is in Oslo, for Newsnight.
:02:23. > :02:27.This was the moment that nation stopped to remember its dead. In
:02:27. > :02:34.Oslo and across Norway, there was one minute of silence, after one
:02:34. > :02:38.day of terror. Even before he was brought to the courthouse, Anders
:02:38. > :02:43.Behring Breivik had admitted he carried out the attacks in Oslo and
:02:43. > :02:49.the youth camp. But he didn't accept he had committed crime. At
:02:49. > :02:54.the court hearing, which was closed, Anders Behring Breivik said he had
:02:54. > :02:59.accomplice, two more terror cells, to help him carry out his plan.
:02:59. > :03:03.TRANSLATION: Anders Behring Breivik, born on February 14th 1979, may be
:03:03. > :03:09.held in custody until it is decided otherwise by the prosecution and
:03:09. > :03:13.the court, but not on September 26th 2011. He will have ban on
:03:13. > :03:18.letters, visits and media throughout the whole custody period,
:03:18. > :03:27.as well as complete isolation until August 22nd 2011. If there were
:03:27. > :03:30.acomplises, were they in the UK? In his 1500-page manifesto, which
:03:30. > :03:35.Breivik had posted on-line, he kwhraimed claimed to have contact
:03:35. > :03:41.with the far right in Britain. There is a concern, but there are
:03:41. > :03:48.no specific information that is it is orderated. It looks like he's
:03:48. > :03:52.more hoping for some kind of copy cat attack. That he's the avant
:03:52. > :03:57.garde of the moment, he's showing the way, and hoping others will
:03:57. > :04:01.follow. This is the moment Norwegian police headed to the
:04:01. > :04:05.island, an hour after the shooting began.
:04:05. > :04:10.Many in Norway assumed their country was being attacked by
:04:10. > :04:14.Islamic terrorists. But this wasn't the work of Al-Qaeda, it was a
:04:15. > :04:20.Norwegian extremist, who committed mass murder. Cold blooded killing
:04:20. > :04:24.by man who called himself a patriot. So had Norway underestimated the
:04:24. > :04:29.threat from home-grown terrorism? I don't think it has been
:04:29. > :04:33.overlooked, actually, back in the 1980s. We had some isolated
:04:33. > :04:36.environments of far right extremism, and they were taken quite seriously
:04:36. > :04:40.in the sense that the police focused on them, and the school
:04:40. > :04:45.system focused on them. And society took some broad concerted efforts
:04:45. > :04:49.to reduce their impact, which I think has been successful. We have
:04:49. > :04:54.much less of it in our political culture than relatively similar
:04:54. > :05:00.countries. But today, the police Security Service revealed it had
:05:00. > :05:05.flagged Breivik in March, when he had purchased chemicals from a
:05:05. > :05:09.Polish business. They said it wasn't significant enough to pursue.
:05:09. > :05:12.Part of the problem of identifying potential threats is the way the
:05:12. > :05:19.far right operates has changed. During the last few years we have
:05:19. > :05:23.seen the emergence of an anti-Islam movement, which has a very
:05:23. > :05:25.different character. They are not street orientated, they are not
:05:25. > :05:30.organisations who gather in meetings and demonstrations or
:05:30. > :05:36.anything like that, they mainly sit behind computers and write
:05:36. > :05:40.statement ones blogs and read letters, and are quite advise
:05:40. > :05:43.invisible. Through mass murder the gunman said
:05:43. > :05:49.he wanted to spark a revolution across Europe, to create a new
:05:49. > :05:55.society. So far he hasn't succeeded. Following the massacre, Norway is
:05:55. > :06:00.united in grief and disbelief at what happened. Anders Behring
:06:00. > :06:03.Breivik sees himself as a crusader against Islam, against immigration,
:06:03. > :06:07.against multiculturalism, the very foundation of modern European
:06:07. > :06:15.society. And while the Norwegian authorities and the public condemn
:06:15. > :06:19.his methods and his extreme message, nationalist sentiment has taken
:06:19. > :06:22.route here. This is a part of Oslo that has seen a huge influx of
:06:23. > :06:28.immigrants over the last 20 years. Most of the people here have come
:06:28. > :06:33.from Somalia, Pakistan and Iraq. The Norwegian Progress Party wants
:06:33. > :06:37.curbs on immigration, their growing popularity match that is of other
:06:37. > :06:42.political forces across Scandinavia. Like the Swedish Democrats, the
:06:42. > :06:48.Danish People's Party, and the True Finns. In Norway the scale of
:06:48. > :06:55.immigration has transformed the country. Barring a minority in the
:06:55. > :07:01.far north, this country was Lily white as late as in the late 1960s.
:07:01. > :07:04.I myself was born in 1959, I grew up in Oslo, I was 17 years old
:07:04. > :07:08.before I met a person of colour that I could have a conversation
:07:08. > :07:11.with in Norwegian. It is a very different situation to what you
:07:11. > :07:16.have in post-colonial Britain. In the course of my adult lifetime
:07:17. > :07:21.this has changed enormously. These are people who are often being
:07:21. > :07:25.urbanised as they also become Norwegianised. So this has caused a
:07:25. > :07:30.number of social problems. This woman was born in Norway, her
:07:30. > :07:35.family is originally from Pakistan. Last Friday, when many Norwegians
:07:35. > :07:40.thought Islamic terrorists were behind the attacks, her relatives
:07:40. > :07:44.received abuse. They said "get out of here", they said it to small
:07:44. > :07:48.children. I don't know, it was a horrible reaction. We live in
:07:48. > :07:55.Norway, and we are as much Norwegian and we feel the same
:07:55. > :07:59.feelings. But tonight, tens of thousands
:07:59. > :08:04.gathered in the centre of Oslo, from different communities and
:08:04. > :08:10.different faiths. After last week's bloodshed, it showed a
:08:10. > :08:15.determination not to let cultural differences divide their country.
:08:15. > :08:23.Steve Rosenberg joins us from Oslo now.
:08:23. > :08:27.What's the mood there tonight? Standing here, by this huge carpet
:08:27. > :08:30.of flowers, and candle, by the Cathedral, I have been watching the
:08:30. > :08:35.stream of people coming here to pay their respects, and the one thing
:08:35. > :08:39.that has struck me, more than anything, is, that represented here
:08:39. > :08:43.is this whole spectrum of Norwegian society, different races, different
:08:43. > :08:50.religions, native Norwegian, the immigrant community. Everyone is
:08:50. > :08:54.united in grief, united in this tragedy. Multicull curlism is now,
:08:54. > :08:58.of course, a - multiculturalism, is now, of course a controversial
:08:58. > :09:04.thing across Europe, many leaders claiming that multiculturalism has
:09:04. > :09:08.failed. And we seem to have lost the link there, unfortunately.
:09:08. > :09:11.David Cameron said today that the Government here was taking
:09:11. > :09:18.extremely seriously those claims that Anders Behring Breivik had
:09:18. > :09:21.links to far right groups in this country. The organisation whose
:09:21. > :09:24.name has been most mentioned is the English Defence League. They say
:09:24. > :09:27.they have no official contact with them. A claim I will be examining
:09:28. > :09:36.with their leader in a moment. First, though, we have been
:09:36. > :09:44.investigating. So, what are the English
:09:44. > :09:49.connections? As investigators delve into Anders Behring Breivik's past,
:09:49. > :09:56.and the causes for concern, the concern is how close to home will
:09:56. > :10:00.the trail go. 14 right-wing extremists are already in prison in
:10:00. > :10:04.England for offences. The Home Office is so concerned, about 70
:10:04. > :10:10.more, who have been accessing terror websites, and threatening
:10:10. > :10:13.mass violence, it has had to intervene.
:10:13. > :10:16.Particular concerns have been raised about a connection with the
:10:16. > :10:21.English Defence League, an anti- Muslim street movement involved in
:10:21. > :10:26.violent clashes with anti-fascists and Muslims. I have been following
:10:26. > :10:30.the EDL for Newsnight for over a year, including travelling to
:10:30. > :10:33.Amsterdam where they met up with their Norwegian counterparts, the
:10:33. > :10:37.NDL. As you see today the English Defence League are here today, we
:10:37. > :10:45.are not hooligans, we are normal people, we have come here today to
:10:45. > :10:50.have our voices heard. The anti- fascist group Searchlight have been
:10:50. > :10:55.looking at the co-operation. Here he is under the name Crusader, he
:10:55. > :11:00.was in contact with EDL people in March before going underground.
:11:00. > :11:04.This posting on the 9th of March, he's congratulating the EDL saying
:11:04. > :11:09.they are a blessing to awful Europe, telling them to keep up the good
:11:09. > :11:12.work, - all of Europe, telling them to keep up the good work, and
:11:12. > :11:18.saying they share a common cause. Here he criticises the
:11:18. > :11:22.establishment in Norway, the media, but he particularly targets out the
:11:22. > :11:26.Norwegian Labour Party. But, then he says, in a slightly airy way, he
:11:26. > :11:30.says he thinks there will be an awakening, at least he hopes so.
:11:30. > :11:35.Are you worried members of the EDL could be a serious threat? Yes I am.
:11:35. > :11:40.Partly they are driven by the same propaganda, and ideology, but also,
:11:40. > :11:44.within it, there are people who are quite dangerous, advocating the use
:11:44. > :11:51.of weapons and burning down of mosques. We have done a cursory
:11:51. > :11:59.look on the Internet, and found EDL supporters posing with guns. It is
:11:59. > :12:06.just an indication of some of the people who are involved in it.
:12:06. > :12:11.Daryl Hobson is an EDL member and claims that Breivik Marched with
:12:11. > :12:15.the EDL before. He has been arrested at several demonstration,
:12:15. > :12:23.including alongside EDL leader, Stephen Lennon, on remembrance day
:12:23. > :12:26.last year. Jonathan Birdwell from the think-tank, Demos, is
:12:26. > :12:30.undertaking a huge studio of the EDL and other far right movements
:12:30. > :12:33.in Europe. If there is evidence he has met with those close to the
:12:33. > :12:40.leadership of the EDL, that is incredibly worrying. In terms of
:12:40. > :12:46.the actions of those individuals and putting cross hires on people
:12:46. > :12:50.like Mr Chouddree. Before you would like to say it is in bad taste or
:12:50. > :12:55.driven by bravado. But in fight of the Anders Behring Breivik attack,
:12:55. > :12:58.we have to give more serious - in the light of the Anders Behring
:12:58. > :13:02.Breivik attack we have to give more serious attention to these groups
:13:02. > :13:05.and on the Internet. David Cameron today said the links will not be
:13:05. > :13:09.underestimated. We take those claims extremely seriously we will
:13:09. > :13:13.look at all the aspects of those claims and we will work very
:13:13. > :13:16.closely with the Norwegians, in terms of the police relationship,
:13:16. > :13:19.in terms of the security relationship, and the very strong
:13:19. > :13:25.political relationship I have with Jens Stoltenberg. We will help them
:13:25. > :13:30.in every day we can. Anders Behring Breivik boasted in his manifesto
:13:30. > :13:36.about having more than 600 EDL members as Facebook friends. Now
:13:36. > :13:39.the social networking site is no science, but in a world where this
:13:39. > :13:44.rhetoric lives and grows on-line, how much these things are feeding
:13:44. > :13:51.one another is cause for alarm. We are joined now by the leader of
:13:51. > :13:57.the English Defence League, Stephen Lennon, who also goes by the name,
:13:57. > :14:00.Robinson. Did you ever meet Anders Behring Breivik? I never. Can I
:14:00. > :14:05.express our deep sympathy for the victims and their families and the
:14:05. > :14:08.people of Norway. How was this man allowed on your demonstrations?
:14:08. > :14:15.don't believe he has. We should stop speculating and look at the
:14:15. > :14:18.facts. I'm looking at evidence from Daryl Hobson, I thought you were
:14:18. > :14:24.arrested with him? There were other people arrested on that day, I was
:14:24. > :14:32.arrested on that day. You were arrested at the time? No, on the
:14:32. > :14:35.same day. Page 148 of his desor e he said we are an anti-Nazi
:14:35. > :14:40.organisation, we can't coincide with this organisation because our
:14:40. > :14:45.ideologies are so far apart. He has stated that. Mr Hobson has claimed?
:14:45. > :14:50.Who is he, he's a random member out of 100,000 members. I thought,
:14:50. > :14:56.first of all, we don't know exactly? 100,000 supporters on the
:14:56. > :15:02.Internet, he's one of them. More to the point this man. Let's not
:15:02. > :15:06.listen to what Daryl Hobson said, let's listen to the psychopath's
:15:06. > :15:11.manifesto says, he says we have non-white members and he is
:15:11. > :15:15.ideolgically apart from us, he calls us fools. The media are not
:15:15. > :15:21.reporting it, we encourage integration. He has 600 EDL
:15:21. > :15:26.friends? If you look at mismanifesto, not speculation, on
:15:26. > :15:32.page 148, I can read them, if you want. Just tell me, out of his
:15:32. > :15:38.manifesto, how much of it do you disagree with, 1500 pages? After
:15:38. > :15:43.7/7 would you say this to a Muslim leader do they share the same parts
:15:43. > :15:47.of ideology. We believe Islam is a threat. Do we want to stop this
:15:47. > :15:49.happening on British soil or play the blame game. I'm trying to
:15:49. > :15:55.establish facts about the connections between your
:15:55. > :15:59.organisation and his? The EDL. can quote endlessly? This is his
:15:59. > :16:07.manifesto, this is from the man himself. The EDL harshly condemns a
:16:07. > :16:12.movement that uses terror as a tool, such as mine, that is why we view
:16:13. > :16:16.the EDL as fools, they believe the democratic system can solve the
:16:16. > :16:21.problems, they have non-European members. This is what the man said.
:16:21. > :16:26.You have also read his listing on one of your forums, "hello to all
:16:26. > :16:30.you good Englishmen and women, just wanted to say you are a blessing to
:16:30. > :16:34.all in Europe". This was before his manifesto was released. It was
:16:34. > :16:37.almost the last thing he published before he disappeared to make his
:16:37. > :16:43.bombs? You have seen his manifesto that he released. Do we want to
:16:43. > :16:47.learn from this, this man was a sick individual, you can never use
:16:47. > :16:50.terror tactics like him. There is an undercurrent of anger, these are
:16:50. > :16:53.the facts people should address, there is an undercurrent of anger
:16:53. > :16:58.across the whole of Europe and Britain. If you don't address the
:16:58. > :17:02.issue and sweep it under the carpet. No-one is sweeping it under the
:17:02. > :17:05.carpet, I'm trying to establish the connection between you and him?
:17:05. > :17:11.When you agree to peacefully protest, we do. That we get
:17:11. > :17:15.condemned for trying to peacefully protest. We can condemn extremism
:17:15. > :17:20.and violence, we are what you would want as a grassroot organisation to
:17:20. > :17:27.the serious threat. You are with Alan Lake one of your founders?
:17:27. > :17:30.is not my mate or a founder. He is a funder? He is not faunder, he has
:17:30. > :17:36.never given a penny to the English Defence League. He has written
:17:36. > :17:40.speeches for you hasn't he? facts, not speculation. Do you know
:17:40. > :17:44.him? I do know him. Do you believe there are dormant racists. Do you
:17:44. > :17:47.agree with him when he says this was logical and inevitable, that is
:17:47. > :17:54.very close to what you are saying? I am disgusted and sickened by what
:17:54. > :17:59.this man done, and every member of the EDL are disgusted, there are
:17:59. > :18:02.dormants racists to be completely racist against Muslims, and sweep
:18:02. > :18:05.the phenomenon of the English Defence League and there are
:18:05. > :18:08.British people gravely concerned, the threat of Islam is having on
:18:08. > :18:13.our nation. And if you want to solve these problems, you won't
:18:13. > :18:17.solve them by dismissing people as racists and putting it out they are
:18:17. > :18:23.there they are lunatic, all people who have concerns against Islam. In
:18:23. > :18:26.every country, 24% of Norwegians voted for an anti-Islamic
:18:26. > :18:30.organisation. There needs a platform given to people to have
:18:30. > :18:34.their concerns heard. This is a peaceful process, you take the
:18:34. > :18:44.democratic right away from those people, God knows what they will do.
:18:44. > :18:47.
:18:47. > :18:53.Your website which has people in the cross hairs of telescopic
:18:53. > :18:59.sights. Your website has pictures of Islamic fundamentalists, in the
:18:59. > :19:02.cross hairs of rifle sights? If you refer back to Facebook where anyone
:19:02. > :19:06.can put anything on, that is not evidence against our organisation.
:19:06. > :19:10.You won't find it on our website, people can check the organisation
:19:10. > :19:14.out, we stand against extremism and contem all acts of violence. But
:19:14. > :19:16.you have to - condemn all acts of violence. But you have to give
:19:16. > :19:21.people who are concerned about Islam an opportunity to have a
:19:21. > :19:26.voice, rather than trying to destroy the voice. No-one denies
:19:26. > :19:33.there is lots of anxiety? About Islam. Tremendous anxieties.
:19:33. > :19:37.soon as you say it you are racist. I'm intrigued to know what it is in
:19:37. > :19:41.his 1500-page manifesto you disagree with? To be honest I
:19:41. > :19:43.disagree with murder, I share the same fact that I believe Islam is a
:19:43. > :19:47.threat, but we completely condemn any acts of violence against
:19:47. > :19:50.innocent people. What has happened over there is horrific and will be
:19:50. > :19:56.remembered for the rest of eternity as a disgusting deranged attack.
:19:56. > :19:59.That is what it is, we condemn it and are against it, you can't brush
:19:59. > :20:02.off millions of people who have concerns against Islam as lunatics,
:20:02. > :20:07.when there is serious concerns, we need to have our voices heard. If
:20:07. > :20:11.you try to take the platform of democratic protest. I'm banned for
:20:11. > :20:15.protesting, what about my human rights, human rights are only there
:20:15. > :20:18.for the Muslim community in this country. We are seeing many of our
:20:18. > :20:21.members given ten-year ASBOs for demonstrating. When they are
:20:21. > :20:24.concerned about Islam, they are not allowed to have a demonstration now,
:20:24. > :20:28.this is land of democracy, unless you want to talk about Islam, then
:20:28. > :20:33.it is not. These are genuine concerns, these at this tanks are
:20:33. > :20:38.not doing their jobs, because all the Government organisations don't
:20:38. > :20:41.have a representative from the working-class in this country, that
:20:41. > :20:44.member is me, we are against extreme violence, God for bid this
:20:44. > :20:48.ever happens on British soil, it is a time coming. You are probably
:20:48. > :20:52.five or ten years away. Thank you very much. That sounds almost like
:20:52. > :20:55.a threat? It is not a threat. think something like this could
:20:55. > :20:59.happen in a few years time? believe it could, it is not a
:20:59. > :21:04.threat, it is a wake up call to say we don't want it to happen, let's
:21:04. > :21:07.address the problem. It won't be solved by keep building more
:21:07. > :21:10.mosques and Islamic immigration, and not listening to people. Thank
:21:10. > :21:14.you very much. Can it really be true that the
:21:14. > :21:19.world's biggest economy is about to default on its debt? Already the
:21:19. > :21:25.possibility of such an unthinkable thing happening has caused the most
:21:25. > :21:29.senior officials in the US Treasury and Federal Reserve to warn of both
:21:29. > :21:33.catastrophy and calamity. However the American constitution requires
:21:33. > :21:37.the agreement of the President and Congress, as things stand there is
:21:37. > :21:42.no agreement. They have until next Tuesday to pass the deal. President
:21:42. > :21:46.Obama and the Republican leadership in Congress are still locked in mu
:21:46. > :21:50.actual recrimination, but the clock is blrb mutual ce cim nation, but
:21:50. > :21:55.the clock is ticking - mutual recriminations, but the clock is
:21:55. > :21:59.ticking. Why does this matter to us? The US spends thrillions of
:21:59. > :22:04.dollars every year, it is the biggest purchasing nation.
:22:04. > :22:09.Thousands of British companies sell directly other indirectly to the US
:22:09. > :22:14.F it wakes up on Monday and decides it can't pay its Wills it goes
:22:14. > :22:19.through all of that. - bills. It goes through all of that. There is
:22:19. > :22:26.the bond market also. As we use the dollar as a reserve currency
:22:26. > :22:30.globally, banks use IOUs, issued by the US Government as a currency
:22:30. > :22:35.between banks. If they default, those IOUs go from being gold
:22:35. > :22:38.plated, to you will always get your money back to default status, where
:22:38. > :22:44.there is no guarantee to get any of your money back. The banks either
:22:44. > :22:49.have to ignore the rules and the facts and carry on as normal, or
:22:49. > :22:54.they stop lending to each other, and balm, the world is in a second
:22:54. > :22:57.credit crunch. Which of the sides is right on that, the President and
:22:57. > :23:03.the associated position of the Democrats or Republicans on Capitol
:23:03. > :23:09.Hill, who is right? There is one fact you can't deny it is the size
:23:09. > :23:12.of the debt. How it got to $14 trillion, under Bush it creeps up,
:23:12. > :23:17.but under President Obama it rockets. He is fighting two wars,
:23:17. > :23:23.he is spending his way out of recession with a fiscal stimlau, he
:23:23. > :23:26.has kept the tax cuts that - stimulus, he kept the tax cuts that
:23:26. > :23:30.Bush started. You can't do that. If the economy was growing we wouldn't
:23:30. > :23:35.have the debate. Many economists say the stimulus hasn't worked, the
:23:35. > :23:39.only way out of recession is to cut the deficit, just as it is a
:23:39. > :23:42.completely respectable position to have here, not a called, as Stephen
:23:42. > :23:47.McCabe, right-wing nuter position. Many economists believe the only
:23:47. > :23:51.way out for the US is to cut its deficit. If that right-wing
:23:51. > :23:58.Republican opposition believes that it is the last chance to cut the
:23:58. > :24:02.deficit, they will fight to the very last minute. We are joined
:24:02. > :24:08.from capitol hill by Earl Blumenauer, a Democrat member of
:24:08. > :24:11.the budget committee, and a Republican member of the House
:24:11. > :24:15.Financial Services Committee. When you look at the damage this is
:24:15. > :24:20.already doing to your country, it is a very dangerous game that is
:24:20. > :24:27.being played, isn't it? Well, but also think of the flip side of that.
:24:27. > :24:32.If you were to look at the Moody's and SNP documents we got a few
:24:32. > :24:37.months ago, they made it very clear if we do not demonstrate we are
:24:37. > :24:45.bending our debt curve we will head towards a downgrade. There will
:24:45. > :24:48.start being a premium on our debt. We are that that - in that
:24:48. > :24:54.juxtaposition where it is demonstrating a credible plan to
:24:54. > :25:00.deal with the sizing of the debt. Earl Blumenauer you can't carry on
:25:00. > :25:04.spending like a drunkle sailor, can you? Nobody is suggesting that. You
:25:04. > :25:08.referenced at the top that there are several things in play on top
:25:08. > :25:13.of that, not two unfunded war, but the another collapse of the economy.
:25:13. > :25:19.Bear in mind the economic stimulus was 40% additional tax cuts over
:25:19. > :25:27.and above the Bush tax cuts. But the issue here is, I think, more
:25:27. > :25:31.fundamental, even my Republican friend's budget will require $8
:25:31. > :25:35.trillion of additional borrowing. How you do this is get serious
:25:35. > :25:39.about raising revenue, about changing spending patterns to
:25:39. > :25:45.reduce spending, but don't play chicken with the debt ceiling. We
:25:45. > :25:48.are going to pay our debts, hopefully we don't have to be
:25:48. > :25:52.punished by international markets to force us to do that. The most
:25:52. > :25:57.direct thing we should do is about be the business, with dealing with
:25:57. > :26:01.what all the experts agree, needs to be a balanced approach, which
:26:01. > :26:05.most of the American public agrees needs to be balanced. Which is some
:26:06. > :26:10.revenue, some programme cuts, and changing how we do business. Right,
:26:10. > :26:16.you have used the expression playing chicken, in a sense
:26:16. > :26:21.everyone is playing chicken here, is there going to be a deal?
:26:21. > :26:30.there going to be a deal? There will be something that will happen,
:26:30. > :26:34.probably before the August deadline, I suspect given the lateness of the
:26:34. > :26:37.hour and the vast differences in opinions that it will be more of a
:26:37. > :26:43.short-term activity. How do you see it, do you think there will be a
:26:43. > :26:46.deal? I would prefer the use of the word "a plan", I have to agree with
:26:46. > :26:52.the Congressman, we may end up with a short-term deal. There is one
:26:52. > :26:56.point, I think the Congressman was touching on it. We have quite
:26:56. > :27:02.adequate cashflows to cover our coupons, our bonded indebtedness,
:27:02. > :27:05.anyone who uses the word "default", it is horribly unfair and
:27:05. > :27:08.inaccurate. What is a more interesting discussion is the 40%
:27:08. > :27:13.of federal spending in the United States, that is financed through
:27:13. > :27:17.borrowing. That is really the debate you are seeing, is how long
:27:17. > :27:22.is that capable of being covered, and if we don't demonstrate a
:27:22. > :27:28.bending of that curve, will we be punished by the rating agencies, no
:27:28. > :27:31.matter what the deal looks like. respectfully disagree. There will
:27:31. > :27:37.be efforts to try to make fundamental changes in terms of how
:27:37. > :27:43.we do business. But the notion that some how we have enough money to
:27:43. > :27:49.satisfy all our obligations without adjusting the debt ceiling in the
:27:49. > :27:54.course of the next week, is rejected by former Republican
:27:54. > :28:00.secretaries of the Treasury, by independent analysts, you may
:28:00. > :28:04.reward Chinese investors and maybe punish British contractors to the
:28:04. > :28:11.American Government. But you don't have enough money to do it all. If
:28:11. > :28:15.you don't do all of it, on schedule, then you are raising a real
:28:15. > :28:17.question about what the Federal Government's reliability going
:28:18. > :28:24.forward. I don't think anybody wants that. And you were talking
:28:24. > :28:27.about this actually earlier, is the portion of US contracts that there
:28:27. > :28:32.would not be cashflow to pay. Once again, you can't use the language
:28:32. > :28:37.of default on bonds, which cause that is a function of coupons, and
:28:37. > :28:42.we see if you even look at our bond futures as of 20 minutes ago, they
:28:42. > :28:49.are still flat, we are still sitting right around the 3% on the
:28:49. > :28:52.ten. So there is so much liquidity in the US debt, it is a so much
:28:52. > :28:55.more interesting and difficult discussion to talk about the 40% we
:28:55. > :29:00.finance through borrowing, that is the honest discussion there. What
:29:00. > :29:03.Dave and his colleagues would do, ironically is give to the President
:29:03. > :29:08.of the United States and the secretary of the Treasury the
:29:08. > :29:12.discretion to decide which they are going to do. Are they going to
:29:12. > :29:19.honour our...That Is technically wrong, I'm one of the spopbs sors
:29:19. > :29:22.of the bills that would step up and priorityways that debt. No bill has
:29:23. > :29:27.passed - prioritise that debt. No bill was passed. And you would give
:29:27. > :29:32.the President the choice to make that decision. As the law is in
:29:32. > :29:39.existence today. It won't be next week. What is that extraordinary
:29:39. > :29:44.green bicycle on your lapel? Quickly. I'm bike partisan, this is
:29:44. > :29:54.the congression bike caucus membership. Which is buy partisan
:29:54. > :29:58.caucus. Labour MPs had a slight spring in
:29:58. > :30:02.their steps as they set, or at least weren't as dejected as they
:30:02. > :30:06.had been before the phone hacking scandal on which their party has
:30:06. > :30:09.made much of the running. The big question to which they will be
:30:09. > :30:14.returning later in the week is what will it make for the party to be
:30:14. > :30:20.re-electable. We start with the man who put the "new "into new Labour.
:30:20. > :30:24.Peter Mandelson, he's conducting a - an investigation into
:30:24. > :30:27.globalisation for the IPPR think- tank. And along the way he's
:30:27. > :30:37.prepared to admit there are some things his party got wrong.
:30:37. > :30:37.
:30:37. > :30:42.Paul Mason reports. It's 8.00am, and Lord Mandelson is
:30:42. > :30:46.on a journey, he's headed for the north-east of England. Mission, to
:30:46. > :30:50.resell the idea of globalisation to Labour's voting base. At the heart
:30:50. > :30:56.of the problem is what happened to manufacturing. During 13 years of a
:30:56. > :31:00.Labour Government, manufacturing fell from 18% of GDP to just under
:31:00. > :31:06.1%. And though Labour created three million jobs, 1.3 manufacturing
:31:06. > :31:10.jobs were lost. In the 1980s the Government actually said, the Prime
:31:10. > :31:17.Minister actually said, and the entire Government machine was
:31:17. > :31:22.geared to the belief that we in Britain could no longer be an
:31:22. > :31:28.engineering, manufacturing, advanced technology economy. Every
:31:28. > :31:33.Government policy heaped prejudice and obstacle and further barrier
:31:33. > :31:43.against those non-financial sector parts of our economy. And we, hold
:31:43. > :31:43.
:31:43. > :31:48.on, and when we, me, us, we came in 1997, we continued that too far,
:31:48. > :31:58.too much. So there is a bit of a mea culpa going on here on
:31:58. > :32:01.
:32:01. > :32:07.industrial policy for Labour. At the port of Tyne, cars build at
:32:07. > :32:13.the Nissan Sunderland plant are set for export, for Asia and the Middle
:32:13. > :32:17.East, not just Europe. Labour sees Nissan as a success
:32:17. > :32:21.story, the dying Brown Government persuaded the Japanese giant to
:32:21. > :32:25.choose Britain as the site for its new electric car engines. Why do
:32:25. > :32:29.they want to bring them all the way from here? Because we are
:32:29. > :32:32.competitive. But he's all too well aware that other European
:32:32. > :32:37.Governments do for more their own industrial base, than Labour did in
:32:37. > :32:41.office. And there are calls for more protectionism within his own
:32:41. > :32:46.party. Out there, in Europe, you are up against a bunch of
:32:46. > :32:51.protectionists, what can you do about it? That is no not true, you
:32:51. > :33:00.are exaggerating, as they say to make a point. I am slightly right,
:33:00. > :33:04.aren't I? Only very slightly right. But we have to watch that.
:33:04. > :33:08.Newcastle City Council, now back under Labour control, Lord
:33:08. > :33:15.Mandelson meets local business people, unions and the council
:33:15. > :33:22.leader. You seem to be full of vim and vigour. We will come back in a
:33:22. > :33:27.year's time. They will look like you! I don't quite know what you
:33:27. > :33:30.mean by that! None of these people see globalisation as a threat, it
:33:30. > :33:35.is just after 13 years of a Labour Government and one of coalition,
:33:35. > :33:39.they worry the skills are just not there to drive an industrial
:33:39. > :33:46.Rennaissance. We have to decline people entering what you would call
:33:46. > :33:50.core stem subjects into the FE sector, that was after national
:33:50. > :33:54.2001-2006, there was a 50% decline. We have fallen off a cliff and kept
:33:54. > :33:58.falling. It would be a priority for you all to go into the schools and
:33:58. > :34:05.take this message. You will find the people who run the schools very,
:34:06. > :34:13.very reluctant to start encouraging pupils in one vocational direction
:34:13. > :34:22.as opposed to another. So what did you make of that?
:34:22. > :34:26.tell you what I made of it, I made of it that there is a very, very
:34:26. > :34:31.strong enterprise base to the north-east economy. That it is, it
:34:31. > :34:34.has changed and is still changing. There is a nightmare, isn't there,
:34:34. > :34:38.for Labour, that is the coalition's the first Government that has
:34:38. > :34:42.really spelt out the country needs to rebalance, it is a forced
:34:42. > :34:46.rebalancing, driven by fiscal policy. What if it works, what if
:34:46. > :34:55.it works where your approach didn't? I would be absolutely
:34:55. > :35:00.delighted. To see a more modern economy, manufacturing advanced
:35:00. > :35:03.manufacturing, backed and becoming more successful. I would be very
:35:03. > :35:07.happy to see a more thriving private sector, business enterprise
:35:07. > :35:10.sector in this country. They did it by cutting back the state, they are
:35:10. > :35:14.cutting back the state, you didn't? That is the point I'm making,
:35:14. > :35:19.cutting back the state is not in itself a solution, when you are
:35:19. > :35:25.cutting back the essential state support for business and new
:35:25. > :35:30.enterprise, new sectors and new markets. At an FE college in
:35:30. > :35:33.Hartlepool, his old constituency, Lord Mandelson south-east sees the
:35:33. > :35:38.entire debate between Labour's support base between the' present
:35:38. > :35:42.tiss. One thinks all the jobs - apprentice, one thinks all the jobs
:35:42. > :35:47.are going to foreigner its, the other one has no problem.
:35:47. > :35:51.factory where you I work people from Germany, Japan, Brazil, just
:35:51. > :35:55.an engineer coming from Brazil to help us with the work, there is
:35:55. > :35:58.people from all over the world. Hartlepool today is still a town of
:35:58. > :36:06.high unemployment, still suffering from the deindustrialisation of the
:36:06. > :36:10.past 30 years. How far does mea culpa translate into English? You
:36:10. > :36:15.don't feel like saying to them, implicitly, sorry, we didn't have
:36:15. > :36:21.an industrial policy for all those years, sorry we did tell you that
:36:21. > :36:26.wealth would trickle doin and it hasn't. You don't - trickle down
:36:26. > :36:29.and it hasn't. You don't feel like apologising for what Labour did in
:36:29. > :36:33.office? What people felt more at the end of our time in Government,
:36:33. > :36:36.than they did at the beginning s first they had a Government that
:36:36. > :36:40.cared about them, secondly, a Government prepared to invest in
:36:41. > :36:43.them and their town, and thirdly, people prepared to plug them into a
:36:43. > :36:48.different, changing economy here in the north-east and in the country
:36:48. > :36:53.as a whole, and prepared to put ourselves out to get them sof
:36:53. > :36:56.welfare into work, reskilled, available to do the jobs, more
:36:56. > :37:02.confident to take the opportunities for the jobs to be created. There
:37:02. > :37:05.are a lot of people still on welfare in the north-east? And few
:37:05. > :37:09.people than if they didn't have Labour Government in power for 13
:37:09. > :37:14.years. That is where Labour is stuck for
:37:14. > :37:19.now, somewhere between defending its record in office and moving on.
:37:19. > :37:25.Lord Mandelson is here now. When exactly did you realise you
:37:26. > :37:30.had been too enthralled to the market? My experience in Europe,
:37:30. > :37:33.when I went off to be Trade Commissioner, and I saw European
:37:33. > :37:36.continental prakti, but I also travelled around the world. -
:37:36. > :37:40.practice, but I also travelled around the world. There was no
:37:40. > :37:46.continent I didn't visit. I saw in all those countries, particularly
:37:46. > :37:50.those nearest to home, a much more strategic, smarter, more activist
:37:50. > :37:55.role for Government acting with markets and with the private sector.
:37:55. > :38:00.Governments who looked after their own people as opposed to what went
:38:01. > :38:05.on here? It was not what the Labour Government was wrong, what we did
:38:05. > :38:08.was right, but ultimately we didn't do enough. Manufacturing output
:38:08. > :38:11.fell faster when you were in office than it did under Margaret
:38:11. > :38:14.Thatcher? We also had the longest sustained period of economic growth
:38:14. > :38:19.in this country under a Labour Government than we have seen since
:38:19. > :38:24.the war. The reason. You know where we are now as a consequence? That
:38:25. > :38:29.has other causes. But what we got right was the huge investment in
:38:29. > :38:33.the supply side of the economy, and skills and science, and
:38:33. > :38:41.infrastructure, we were right to acouldn't a pro-enterprise approach
:38:41. > :38:44.to - encourage a pro-enterprise approach to business. We were right
:38:44. > :38:48.to maintain flexibility and competitiveness of labour, product
:38:48. > :38:54.and capital markets. Where we didn't do enough, however, was in
:38:54. > :38:59.acting with the private sector, with markets, to give a lift, to
:38:59. > :39:02.give a particular help to particular sectors, technologies,
:39:02. > :39:08.growing markets, where our future jobs were going to be created. We
:39:08. > :39:11.didn't do enough. Do you think you were also too enthralled to the
:39:11. > :39:18.banks? No, I don't think we were enthrafld to the banks. I think
:39:18. > :39:22.what we - enthrafled to the banks. What we had inherited was a
:39:22. > :39:25.throwing financial services sector, that was generating a colossal
:39:25. > :39:30.amount of wealth, revenue and employment in our economy. What I
:39:30. > :39:34.do, however, think, is we became overexposed to the financial sector.
:39:34. > :39:38.That meant when it went wrong, our exposure, and therefore the
:39:38. > :39:42.consequences for our economy, was much greater than those that had
:39:42. > :39:48.less exposure to the financial sector. Do you also accept that you
:39:48. > :39:51.failed in education, in terms of turning out people who were fit for
:39:51. > :39:55.the jobs that might become available? That was the evidence we
:39:55. > :40:00.saw in the film, surely? That was not the evidence you saw on the
:40:00. > :40:04.film. What we did. I thought that was what the business leaders were
:40:04. > :40:09.telling you? No, what they were saying is there was an insufficient
:40:09. > :40:14.bias in favour of science, technology, engineering and
:40:14. > :40:18.mathematics graduates coming from the further and higher education
:40:18. > :40:21.sector. It doesn't mean to say we failed in education. You failed in
:40:21. > :40:26.education to meet the needs of industry? I don't think that is
:40:26. > :40:31.true. Not in the basics. But I do think that part of the bias that
:40:31. > :40:35.had grown up in our country, against manufacturing, against
:40:35. > :40:41.engineering, against science, was not sufficiently turned round
:40:41. > :40:45.during our period in Government. We expanded higheredcation, the -
:40:45. > :40:51.education, the quality of it, the volume of people going through
:40:51. > :40:56.higher education all expanded. I'm afraid we did, insufficient, in my
:40:56. > :41:03.view, to live down and reverse that historic prejudice against science
:41:03. > :41:08.and engineering andatics, that had grown in our - and mathematics,
:41:08. > :41:13.that had grown in our country during the 1980s. When you hear
:41:13. > :41:18.that young man speaking how he has Chinese, Brazilians, people from
:41:18. > :41:23.all over Europe, coming to take jobs. And you contrast it with
:41:23. > :41:30.Gordon Brown's talk about British jobs for British workers, something
:41:30. > :41:34.went certificate yuesly awry? seriously awry? We went round the
:41:34. > :41:39.table and I asked all the young people about global yoisation,
:41:39. > :41:44.about us having - globalisation, about us having to face competition
:41:44. > :41:46.from the major economies, only one exception said they wanted to
:41:46. > :41:51.travel and could see opportunities for employment, and us working
:41:51. > :41:55.together with these economies, to earn our living in the global
:41:55. > :41:58.economy in the future. I was very encouraged by that, it is a truth.
:41:58. > :42:04.We are not going to earn our living during the course of this century,
:42:04. > :42:07.by running away from the global economy, and pretending that
:42:07. > :42:10.globalisation doesn't exist. Has Ed Miliband learned the lessons you
:42:10. > :42:15.have learned? I think he has, during the two years we were
:42:15. > :42:18.working together, when I came back to Government, he was energy and
:42:18. > :42:22.climate change secretary, I was the Business Innovation and Skills
:42:22. > :42:28.Secretary. We worked very closely together, in delivering an
:42:28. > :42:35.industrial strategy to bring about a low carbon transition in this
:42:35. > :42:39.country. Not just the importing of energy and manufactureed goods from
:42:39. > :42:42.abroad, but making them in this country. That required certain
:42:42. > :42:48.heavy lifting, certain pump priming, certain strategic interventions
:42:48. > :42:51.from the Government, which he and I were prepared to deliver, the sort
:42:51. > :42:55.of industrial activism, I think and I accept now we should have
:42:55. > :42:59.operated more on in our time in Government. Has he yet found what
:42:59. > :43:03.you failed to detect in the early days of his campaign, which was a
:43:03. > :43:11.substitute for new Labour? I don't think he has, no. It would not
:43:11. > :43:14.appear that he has a found of - a substitute of new Labour. We know
:43:15. > :43:18.new Labour is buried. We don't know what will take its place. That I'm
:43:18. > :43:21.sure will emerge during the course of the coming year. He has had a
:43:21. > :43:25.good run on the hacking story, hasn't he? There are two
:43:25. > :43:31.observations I would make about the state of the party under Ed, one
:43:31. > :43:37.internal and unextrpbl, the internal one is we haven't -
:43:37. > :43:41.external, the internal one is we haven't fallen apart in disunity
:43:41. > :43:44.and acrimony as we have before in opposition. The courage and
:43:44. > :43:50.leadership he showed over News International, and Murdoch, has
:43:50. > :43:56.earned him a hearing in the country. He has made his mark, now he has to
:43:56. > :43:59.say things which are even more of interest to people, on the standard
:43:59. > :44:02.policy areas which concern people, the economy, the future of the
:44:02. > :44:07.welfare state, public services, and taxation.
:44:07. > :44:12.And on the hacking story, I mean in the unlikely event your diary was
:44:12. > :44:17.empty this weekend and the Murdochs invited you to a party, would you
:44:17. > :44:21.go? I won't actually be in the country next weekend. If your diary
:44:21. > :44:25.were empty, is my question? If my diary was empty would I go to a
:44:25. > :44:31.party with Rupert Murdoch, I think on balance, the answer to that is,
:44:31. > :44:35.no. But you, of course, were at Elizabeth Murdochs, just a couple
:44:35. > :44:40.of days before the Milly Dowler revelations? I was at a party of
:44:40. > :44:45.Elizabeth and her husband, and I certainly wouldn't turn my back on
:44:45. > :44:52.any friend I have. Whichever family they belong to. What I did not do,
:44:52. > :44:56.though, during the last 15 and 20 years, was indulge News
:44:56. > :44:58.International and the Murdochs, I did not court the Murdochs, and I
:44:58. > :45:02.have very strong particular personal reasons for not having
:45:02. > :45:07.done that. Do you think they have had a bad influence on this
:45:07. > :45:09.country? I think that their power has been too great, I think it has
:45:09. > :45:14.been insufficiently challenged by successive Governments, I think
:45:14. > :45:20.they have been courted far too actively by politicians, and I'm
:45:20. > :45:24.glad that ...Including You? Not me. Including the Labour Party under
:45:24. > :45:28.your leadership? Certain lie by my party, that will not - certainly by
:45:28. > :45:34.my party, that will not be the case in the future. We will talk more
:45:34. > :45:38.about Labour's time in office and what they need to claim back office
:45:38. > :45:45.on Wednesday, as we hear views on what they got wrong when it comes
:45:46. > :45:53.to the welfare state. That is quite to the welfare state. That is quite
:45:53. > :45:56.We have a bit of a mixture again tomorrow, varying amounts of
:45:56. > :46:00.sunshine, starting off cloudy, I suspect, a bit of rain and drizzle
:46:00. > :46:04.here and there. No great amounts, that will fade away. Eastern areas
:46:04. > :46:07.of the UK will stay cloudy. Further west sunshine coming through. Much
:46:07. > :46:11.brighter for North West England compared with north-east England.
:46:11. > :46:15.Cool, cloudy weather right the way down the eastern side of England. A
:46:15. > :46:19.cooler, cloudier day in the south- east of England than today, dry by
:46:19. > :46:23.the afternoon. There will be a bit more sunshine, watch out for misty
:46:23. > :46:27.low cloud around some of the coasts of Cornwall, for Devon, the West
:46:27. > :46:31.Country, sunshine around here. More sunshine than in Wales, should be
:46:32. > :46:34.dry in the afternoon, temperatures hitting 23 degrees along the south
:46:34. > :46:40.coast. For Northern Ireland the south west will be cloudy, the
:46:40. > :46:44.north-east will be sunny, a warmer sunnier day in Antrim and Down than
:46:44. > :46:54.today. The west of Scotland nice in terms of sunshine, the east not as
:46:54. > :47:06.