:00:13. > :00:18.Hello, within weeks, Greece could have tumbled, stalked, or been
:00:18. > :00:22.chucked out of the euro. An intense nervousness, panic in some places,
:00:22. > :00:26.is at large. All of us will be affected. Tonight, how it could
:00:26. > :00:30.happen and what will be the consequences. If Spain falls apart,
:00:30. > :00:34.will the face of Europe be changed forever. We have the Nobel Prize-
:00:34. > :00:42.winning economist, Paul Krugman here, the Harvard economist,
:00:42. > :00:45.Kenneth Rogoff, and from Athens, former Greece politician, Giorgos
:00:45. > :00:48.Papakonstantinou. Many think that the Germans will
:00:48. > :00:52.soon blink, that forcing Greece out of the euro will be unthinkable,
:00:52. > :00:55.what if they are wrong? We will tackle the question whether
:00:55. > :00:58.George Osborne's medicine for this country is not so quietly killing
:00:58. > :01:02.the patient. The Government's central aim is to
:01:02. > :01:04.cut the deficit and establish international credibility, what if
:01:05. > :01:08.the eurozone crisis means they can do neither.
:01:08. > :01:15.We will hear from Dublin, where they are being asked to vote for
:01:15. > :01:18.long years of austerity, to atone for their bankers' sins. David
:01:18. > :01:21.Cameron's former Director of Communications, Andy Coulson, has
:01:21. > :01:29.been charged with perjury tonight, after being questioned by police in
:01:29. > :01:33.Glasgow. We will have the latest.
:01:33. > :01:36.The world's biggest company, ensuring people who export goods,
:01:36. > :01:40.said today it was no longer covering anyone who wants to send
:01:40. > :01:44.stuff to Greece. Nothing will change before the election there on
:01:44. > :01:48.June 17th, and the latest opinion polls show the biggest parties in
:01:48. > :01:52.favour and against the bail out are at absolutely level pegging. Which
:01:52. > :01:55.is no help to anyone, really. In the meantime, there is talk of
:01:55. > :02:01.power cuts because there is no money to pay energy suppliers. So
:02:01. > :02:07.the rest of the eurozone, now contemplates something we were told
:02:07. > :02:11.was inconceivably, recently, that like a bad kebab, Greece is vomited
:02:11. > :02:15.out of the single currency. What happened today? Almost every day
:02:15. > :02:22.brings headlines to which the subtext is, confusion, lack of
:02:23. > :02:27.focus, unreality, incompetence, general clutching at straws, as the
:02:27. > :02:32.train hurtles towards you. Today was no different. You mentioned
:02:32. > :02:36.today that the Greek press got hold of a document to the Prime Minister
:02:36. > :02:40.that they may face blackouts because they can't pay electricity
:02:40. > :02:47.bills. We find out in the next 24 hours how much money has fled
:02:47. > :02:53.Greece over the past week. We know if the -- in the past three months
:02:53. > :02:55.58 million has fled Europe over the past few months. Spain is in
:02:55. > :02:59.serious trouble and needs a bank bail out. There is the mechanism to
:02:59. > :03:02.do, that the European Union has the money to do that. Right now Spain
:03:02. > :03:05.doesn't want to take that money. It is saying, we don't want to be like
:03:05. > :03:09.Ireland, we don't want to be the slaves of Europe. This is, of
:03:09. > :03:14.course, on the eve, tomorrow, of the Irish referendum. Where the
:03:14. > :03:18.Irish are going to sign up for an austerity deal that the Spanish
:03:18. > :03:24.have just negotiated a one-year opt-out from, that is conyou fewed,
:03:24. > :03:28.so is everybody else -- if that is confusing, so is everybody else.
:03:28. > :03:33.Greece could leave the euro? Ever since the Brussels summit last week
:03:33. > :03:39.the feeling is, most people think, look, Merkel is talking tough to
:03:39. > :03:43.try to get Greek voters to go back to the centre. To recoil in horror
:03:43. > :03:46.from any exit from the eurozone, so they vote how the European Union
:03:47. > :03:51.would like them. Most people think, whether it is just before or just
:03:51. > :03:55.after the elections, the Germans will have to relent and say it is a
:03:55. > :03:58.bluff. And they will give the Greeks some extra time to pay, like
:03:58. > :04:02.Spain, another year to meet the targets. That is what the money is
:04:02. > :04:07.on at the moment. But, as we are about to see, the ability of
:04:07. > :04:14.politicians to effect economics, ever since Lehman Brothers, has
:04:14. > :04:19.been very limited. If Greece left the euro, the
:04:19. > :04:24.reaction would be frantic. Every Government, every Central Bank, and
:04:24. > :04:28.all financial markets would be faced with immediate choices.
:04:28. > :04:33.But the first 48 hours of a Greek exit would depend on precisely why
:04:33. > :04:36.the exit happened. Politically it is impossible to
:04:36. > :04:41.expel Greece from the eurozone, and none of the parties likely to win
:04:41. > :04:47.the election want to leave, including the left. So a Greek exit
:04:47. > :04:52.would be messy. Driven by economics, driven by capital flight, bank run,
:04:52. > :04:57.and the breakdown of cross-border payment mechanisms. If you lent
:04:57. > :05:01.money in euros to Greece, and your debt is redenominated into drachmas,
:05:01. > :05:04.which falls against the euros, you will get less money back. There is
:05:04. > :05:08.also a significant likelihood that banks would go under in Greece, a
:05:08. > :05:12.large number of companies would probably be bankrupt as well. So
:05:12. > :05:19.there would be more straight forward forms of default as well.
:05:20. > :05:23.With the far left riding high in the election. And the far right on
:05:23. > :05:26.the March, any financial collapse would -- march, any financial
:05:26. > :05:30.collapse would spell trouble. There is already trouble.
:05:31. > :05:34.We have got total polarisation, we have an economic programme the
:05:34. > :05:40.Greeks didn't vote for. We have violence in the streets. We have
:05:40. > :05:44.got Neo-Nazis in parliament. That is before any problems of euro
:05:44. > :05:48.exit? Yeah, absolutely. Before any problems of euro exit. The other
:05:48. > :05:52.thing people say, it is awful, but it is awful now.
:05:52. > :05:56.For London, as a financial centre, there would be deep concern. Not
:05:56. > :06:02.over Greece, but over the three trillion euros worth of foreign
:06:02. > :06:06.money sitting in Italy and Spain, which might leave.
:06:06. > :06:10.The very sense of crisis and uncertainty, is jittering the
:06:10. > :06:15.global markets, which is having an effect on our real economy. It is
:06:15. > :06:19.not through trade or diplomatic links, and they would be deeply
:06:20. > :06:25.concerned that the sense of instability would mean that any
:06:25. > :06:31.other institution that was not completely 100% robust, would sense
:06:31. > :06:35.the shockwaves and find themselves in a more perilous situation.
:06:35. > :06:44.British banks' exposure to Greece is small. Exposure to sovereign
:06:44. > :06:48.debt of Italy and Spain, is just over 10 million to Barclays, RBS
:06:48. > :06:53.and HSBC, but it would decrease the value of eurobonds across the
:06:53. > :06:58.eurozone. And here RBS, with 0 billion total exposure, is among
:06:58. > :07:01.the highest in Europe. In the first 48 hours after a Greek exit,
:07:01. > :07:05.everything would depend on preventing the financial collapse
:07:05. > :07:12.of Spain. The money to do that exist, right now Spain is quibbling
:07:12. > :07:15.over the terms of accepting it. As for Greece, it would face not
:07:15. > :07:20.only banking and monetary chaos, its exports would more or less
:07:20. > :07:23.double in cost, that is bad. There is a lot of fear. People are very,
:07:23. > :07:28.very worried about this. It feels like falling off the edge of a
:07:28. > :07:32.cliff to a lot of people. There is a lot of fear about poverty, about
:07:32. > :07:37.hunger, about political chaos. Greece imports 40% of the food at
:07:37. > :07:41.the moment. Almost all its medicines, all its oil. And as the
:07:41. > :07:48.Greeks left, the credibility of the euro as a permanent currency union
:07:48. > :07:53.would be shattered. Giorgos Papakonstantinou is in
:07:53. > :07:57.Athens, where he was until recently a Government minister,'s now a
:07:57. > :08:02.PASOK candidate in the forth coming elections, and taking an anxious
:08:02. > :08:08.interest in things there. Paul Krugman is a Nobel Prize-winning
:08:08. > :08:12.economist, who is betting on an exit from the euro zone. Do you
:08:12. > :08:17.think as a currency the euro is worth saving? I think it is a
:08:17. > :08:21.mistake, but it is a difficult thing to say it should never have
:08:21. > :08:26.been done and it is likely to collapse. I would like to save the
:08:26. > :08:28.euro. But I don't think Greece and the euro is a reasonable
:08:28. > :08:33.proposition. Giorgos Papakonstantinou, why is leaving
:08:33. > :08:38.the euro a bad idea from the Greek perspective? Well, first of all,
:08:38. > :08:41.can I take issue with your bad kebab analogy, which I find
:08:41. > :08:46.offensive. The Greek economy is in a crisis s the Greek people are
:08:46. > :08:51.going through a lot, they deserve some respect. I really didn't find
:08:51. > :08:56.that very appropriate. Coming to your question, leaving the euro
:08:56. > :09:01.would lead to reduction with a GDP falling by over 20%. It would
:09:01. > :09:06.double today's extremely high unemployment from 20% to over up to
:09:06. > :09:10.40%. It would lead to a halving of living standards, and to widespread
:09:10. > :09:15.poverty. Today's situation is very difficult and very bad, but leaving
:09:15. > :09:20.the euro would lead the economy back to the 50s and 60s, that is
:09:20. > :09:23.not something they would want to live through. I would support that,
:09:23. > :09:27.that was quite inappropriate to say the Greeks have done something
:09:27. > :09:31.terribly wrong, they made errors, but the trouble, the reason, it is
:09:31. > :09:34.going to be awful, if Greece exits. It will be awful in the short run.
:09:34. > :09:40.The trouble is the situation for Greece is hopeless, and I mean that
:09:40. > :09:45.in a quite literal sense. Under the euro, there is nothing on the
:09:45. > :09:48.horizon to suggest any recovery, ever. We are looking at extremely
:09:48. > :09:52.high unemployment, being shut out of the capital markets, as far as
:09:52. > :09:56.the eye can see. While an exit would be terrible, there would be,
:09:56. > :10:00.you can see how a recovery could happen afterwards. I understand
:10:00. > :10:04.that nobody wants to bite that bullet. Nobody wants to take that
:10:04. > :10:10.decision. Which is why I think it is actually that the decision will
:10:10. > :10:16.be take be out -- taken out of the hands of the politicians. If anyone
:10:16. > :10:19.can give me any story where Greece returns to prosperity or a halfway
:10:19. > :10:23.acceptable situation staying within the euro, I would be happy to
:10:23. > :10:27.reconsider, I haven't seen that story. Can you imagine such a story,
:10:27. > :10:30.Giorgos Papakonstantinou? I do, I deliver here with Paul, I think
:10:30. > :10:34.that clearly we need much more time than what the current programme
:10:34. > :10:38.gives us, to put the finances in order. But we are very close to
:10:38. > :10:41.running a primary surplus. The main problem is the economy isn't
:10:41. > :10:46.growing, and the economy isn't growing, it wasn't growing before
:10:46. > :10:50.the bail out. We were actually in recession since 2008. Before we
:10:50. > :10:54.started the austerity package. Clearly the austerity package has
:10:54. > :10:57.made things much worse. We need growth. Growth needs to come with
:10:57. > :11:02.the help of our European partners, through some kind of a growth
:11:02. > :11:05.package. With confidence returning and investment flowing back in. We
:11:05. > :11:09.have a privatisation programme, which should attract foreign
:11:09. > :11:12.investment. For all this to work you have to have a stablised
:11:12. > :11:17.situation, at the moment Europe is not giving the right signals. There
:11:17. > :11:22.has been some progress in improving the institutional architecture, but
:11:22. > :11:26.not enough. And the big moves have not been made yet. I'm hopeful that
:11:27. > :11:32.there is a wind of change in Europe at the moment, following also the
:11:32. > :11:38.French election, which will change the emphasis away from exclusively
:11:38. > :11:42.looking at austerity, and balancing it more with growth, and having the
:11:42. > :11:46.banks being able to bring the liquidity into the system. At the
:11:46. > :11:52.moment you have both the demand not being there, because wages and
:11:52. > :12:00.salaries have been cut, and a banking system not funking, which
:12:00. > :12:03.doesn't provide working cap -- functioning which doesn't provide
:12:03. > :12:07.working capital. How close are things to not working there?
:12:07. > :12:11.have had a fragmented result, from an election, and we have an
:12:11. > :12:19.election where the result is hanging in the air. The polls at
:12:19. > :12:26.the moment give the Conservatives and the left parties pretty much
:12:26. > :12:29.equal results. So it is touch and go, where this will go, it is clear
:12:29. > :12:34.the problems are too big for one party to shoulder this. We tried
:12:34. > :12:40.this for two years, we had an absolute majority in parliament and
:12:40. > :12:44.we failed. That is the point, my sense is, in fact, the coalition in
:12:44. > :12:48.Greece was doing all of the things it was asked to do. The trouble is
:12:48. > :12:54.that was not producing growth. That nothing plausibly on the horizon
:12:54. > :12:59.will produce growth. Even if the sternness of European austerity
:12:59. > :13:03.demanded is lessened a bit, that will not provide growth. Greece is
:13:03. > :13:06.highly uncompetitive in growth, the idea that you can close those
:13:06. > :13:11.structural reforms in any time frame is unreasonable. Some of us
:13:11. > :13:16.cut our teeth in way on the Argentine crisis more than a decade
:13:16. > :13:20.ago. It was, in some ways, easier, because they had their own currency.
:13:20. > :13:23.It was the same thing, there was no plausible route back to an
:13:23. > :13:28.acceptable economic situation, except via devaluation. I think
:13:28. > :13:33.that's going to be the case here. We just don't see how this can ever
:13:33. > :13:38.be reinvolved, otherwise. Remember, however, in the last two years, we
:13:38. > :13:43.clawed back the competition that was lost, in unit labour costs,
:13:43. > :13:51.since the starting of the eurozone. Greece has some existing advantages,
:13:51. > :13:55.like tourism and shipping, and some new ones like renewables, logistics.
:13:55. > :13:59.It does have the natural resources, the people, the ideas, to move
:14:00. > :14:04.forward. But it costs you power? keep the engine growing.
:14:04. > :14:08.eventually you lost power? We did. I actually take the same view, I
:14:08. > :14:14.think there is a lot of fundamental strengths, which are reasons why
:14:14. > :14:17.Greece, after an exit might recover much more quickly than people think.
:14:17. > :14:21.But the notion that the exports, essentially it will require exports,
:14:21. > :14:27.one way or another, the notion that the exports will come on stream,
:14:27. > :14:33.fast enough, with no, under the current regime, to avoid what is an
:14:33. > :14:37.on going catastrophy becoming unmanageable. I hope and would love
:14:37. > :14:41.to believe you are right. This is a horrible situation, it is a trap,
:14:41. > :14:45.and not the fault of the Greeks for the most part. But, my God, how
:14:45. > :14:50.much longer can this last, the action forcing the event will, of
:14:50. > :14:54.course, be people pulling money out of Greek banks. The ECB has to
:14:54. > :14:58.offer either unlimited credit, with no security, or pull the plug.
:14:58. > :15:04.Maybe they will do that, maybe they will string it on for another year.
:15:04. > :15:10.I find it hard to believe. You are geting any signs in Athens of
:15:10. > :15:14.concessions about to be made to you? I think it is clear that the
:15:14. > :15:19.troika is realising, also partly as a result of the election result,
:15:19. > :15:23.but partly also, looking at the fundamentals of the economy, that
:15:23. > :15:28.something has to give. If you ask any economist they will tell you
:15:28. > :15:33.that the fiscal path we have been following is extreme. We reduced
:15:33. > :15:36.the primary deficit by eight percentage points in two years.
:15:36. > :15:42.That has never been done before. To continue on this path, without
:15:42. > :15:45.giving it some slack, makes no sense. The more you hit on the
:15:45. > :15:54.fiscal side, the more difficult structural reforms become. Because
:15:54. > :15:59.the society is in such a difficult situation it is very hard to get
:15:59. > :16:06.acceptance around necessary reforms, but reforms always have people who
:16:06. > :16:11.oppose them. You do need, and the troika is ready to give, and the
:16:11. > :16:15.European partners, thinking of Germany, because it comes down to
:16:15. > :16:16.that, certainly some leeway of the base on the fiscal side. And
:16:17. > :16:20.hopefully on some other issues as well.
:16:20. > :16:25.Thank you very much. Only a fool would predict precisely how this
:16:25. > :16:28.crisis will end, but Greece is far from the end of the story. The
:16:28. > :16:32.interest the Spanish Government has to pay to borrow money reached
:16:32. > :16:37.record levels today, because so many people who ought to know,
:16:37. > :16:42.seriously doubt whether it has the wherewithal to keep the country's
:16:42. > :16:45.banks afloat. Spain, the fourth- biggest economy in the eurozone,
:16:45. > :16:52.threatens the entire edifice, it is not about individual countries but
:16:52. > :16:56.whether the euro itself can be rescued.
:16:56. > :17:01.Imagine this, it is six months on from the Greek exit, it has been
:17:01. > :17:07.orderly, negotiated, there has been no euro crash. But on the housing
:17:07. > :17:12.estates of peripheral Europe, things are very bleak.
:17:12. > :17:15.I think six months after a Greek exit we would still be in a period
:17:15. > :17:19.of economic and financial uncertainty and weakness. Our
:17:19. > :17:23.expectation is that the economy would contract, fairly sharply, we
:17:23. > :17:27.would expect the eurozone GDP to drop something like 5%, on a par
:17:27. > :17:30.what we saw during the global recession of a couple of years ago.
:17:30. > :17:34.If all that looks bleak, it is possibly the best you could hope
:17:34. > :17:42.for if Greece exits, because a disorderly exit could, six months
:17:42. > :17:46.down the line, pose severe threats to the entire europroject. The
:17:46. > :17:51.biggest systemic risk is Spain, its economy is shrinking now, its
:17:51. > :17:56.sovereign debt already verging on unmanageable, its banking sector
:17:56. > :18:04.sitting on a mountain of bad debt that nobody wants to calculate.
:18:04. > :18:12.think there is a serious chance that the eurozone could break up.
:18:12. > :18:17.There are adverse economic factors on going. There are crippling high
:18:17. > :18:22.levels of debt and problems, one has to fear the exit process of a
:18:22. > :18:27.country like Spain, would effectively sound the death knell
:18:27. > :18:32.for the euro all together. Until now Germany insistence on austerity
:18:32. > :18:36.for Greece has been seen as a giant bluff. But if it does drive Europe
:18:36. > :18:41.to ruination, even stalwarts of the political centre, now see that as
:18:41. > :18:43.changing the debate over austerity versus growth. It may be that the
:18:43. > :18:47.approach of the Washington consensus, and George Osborne and
:18:47. > :18:51.Cameron, is simply wrong, and that Greece is one of the first people,
:18:51. > :18:55.because they have absolutely nothing to lose. The first groups
:18:55. > :19:04.of people putting their head above and saying, no, we are not
:19:04. > :19:07.accepting this. I think it might be totemic, for how the whole
:19:07. > :19:10.austerity project is seen. Economists find it hard to model
:19:10. > :19:14.what is coming. At least they are thinking about it. The problem is,
:19:14. > :19:17.for the centrist politicians and civil servants who run Europe, they
:19:17. > :19:21.don't even want to think about it. When you look at what is happening
:19:21. > :19:27.in Greece, on the streets, you can see why. The old split between left
:19:27. > :19:32.and right is still there underneath. It still simers, there is still a
:19:32. > :19:36.sense of families and political history. Your grandfather killed my
:19:36. > :19:44.grandfather, that could come back? Your grandfather killed my
:19:45. > :19:52.grandfather, it is already coming back. The political goss are from a
:19:52. > :20:02.past Greece thought it had put behind it. If it fails there is no
:20:02. > :20:07.shortage of specters to haunt Europe. Paul Krugman is still with
:20:07. > :20:12.us, with a similar enlike peedic knowledge of euroaffairs, we have
:20:12. > :20:22.Kenneth Rogoff in Washington. What is the problem here, is it one of
:20:22. > :20:26.demand for debt? Well, I think that fundamental problems is a huge
:20:26. > :20:29.overhang of doubt you have to deal with. You can't deal with it
:20:29. > :20:33.watching the periphery countries of Europe being in recession for ten
:20:33. > :20:38.years. That is not going to happen. There has to come a plan to bring
:20:38. > :20:43.the debt down. Growth is a piece of it. They need to write down debt
:20:43. > :20:46.and need inflation. They need plan for restoring competitiveness in
:20:46. > :20:52.the periphery. If they are not going to have their own currency,
:20:52. > :20:58.then the euro needs to go down. way I think about Spain, is for ten
:20:58. > :21:03.years they were seen as the golden boy of Europe, now it is safe
:21:03. > :21:07.because it is part of the eurozone, money flooded in. A lot of it the
:21:07. > :21:12.Germany banks lending to Spanish banks, which fuelled a huge housing
:21:12. > :21:15.bubble. A lot of inflation, they get uncompetitive, the bubble
:21:15. > :21:19.bursts, how do they get back to being competitive again? The
:21:19. > :21:23.current strategy is that they should cut their wages, and some
:21:23. > :21:29.how do enough austerity to pay that debt. It is impossible. The demands
:21:29. > :21:32.being placed on Spain are impossible. If Greece exits, then
:21:32. > :21:37.everybody says it is impossible, money starts flooding out of Spain
:21:37. > :21:42.and Europe has a choice. And the choice is? The choice is, Ken and I
:21:42. > :21:48.seem to agree, that credit has to be made available, open-ended
:21:48. > :21:58.lending, so when people pull their euros out the banks don't collapse.
:21:58. > :22:01.An unlimited supply of euros from frack further. More debt? It is
:22:01. > :22:05.temporary, because if the panic stops the money comes back. You
:22:05. > :22:10.have to have inflation in Europe, instead of Spain having to cut its
:22:10. > :22:16.wages, at least it is not solely through cuts of Spanish wages, but
:22:16. > :22:20.we will have rising German wages, which is an easier way for Spain to
:22:20. > :22:24.become competitive. It is a change in the vision of Germany policy.
:22:24. > :22:29.Instead of punishing the debtors and having price stability, they
:22:29. > :22:35.have to have something more liberal, they have to have a party.
:22:35. > :22:42.Rogoff, inflation and more debt, is that a solution? No, I don't agree
:22:42. > :22:45.with the more debt. I certainly agree about writing down debt. I
:22:45. > :22:49.think inflation is a piece of the solution, all over the world. I
:22:49. > :22:52.don't think there is really way to go forward here without having some
:22:52. > :22:56.political union, or vision of political union. I don't think this
:22:56. > :23:03.is all about Germany being stingy. It is also about not wanting to
:23:03. > :23:09.have -- st, ing ey it is also about not wanting to have an open bar for
:23:09. > :23:12.the rest of Europe. I'm not saying what they are proposing is
:23:12. > :23:16.necessarily nearly the end of things. I really think the only way
:23:16. > :23:23.this is going to end is either Europe starts to look like a real
:23:23. > :23:28.country, and I mean France and Germany, part of the same country,
:23:28. > :23:33.central Government with a lot of taxing power, or it splits up.
:23:33. > :23:38.Unless they start moving that way enthusiastically soon, I don't
:23:38. > :23:44.think anything will stablise the situation. I hope's wrong about
:23:44. > :23:48.that, if he's right it will be over. I have done Ireland versus Nevada,
:23:48. > :23:54.not the landscape, but everything else looks remarkably similar.
:23:54. > :23:59.Because the way the US fiscal system exists, Nevada is receiving
:23:59. > :24:02.de facto aid on the scale of 5-6% of GDP, from Washington. Try to
:24:02. > :24:09.imagine that Europe, that Germany would be willing to countenance a
:24:09. > :24:12.system where 5-6% of GDP, not in loans, but actual aid, is given to
:24:12. > :24:16.southern European countries at the moment, that is not conceivable.
:24:16. > :24:22.That is a generation's work. We don't have a generation, we may not
:24:22. > :24:29.have more than a few months here. By that analysis, the euro has had
:24:29. > :24:36.it? Some doubt write downs, that some default, plus some inflation,
:24:36. > :24:40.might make it, might make it manage gt, over a five-year d manageable,
:24:40. > :24:43.over a five-year period to get an adjustment. That is not good, the
:24:43. > :24:46.solution that the United States of Europe is much to be desired.
:24:47. > :24:51.it won't happen during my working lifetime.
:24:51. > :24:56.Ken Rogoff, you tried to get in? think that will be a problem. I
:24:56. > :25:00.think they need to lay out a vision, it could be 15-20 years, right now
:25:00. > :25:05.it is a moving 40-50 years. But they need to lay out a vision where
:25:05. > :25:09.it is going forward, not backward. I think the French election was in
:25:09. > :25:15.some sense a rejection of moving to a closer Europe, a rejection of
:25:15. > :25:19.having more interdependance. I certainly see that Germany, one way
:25:19. > :25:24.or another, is not going to get paid. Either because there is going
:25:24. > :25:28.to be default, inflation or it will make transfers t has to pick its
:25:28. > :25:32.poison. I'm very sympathetic to their wanting rules, at least
:25:33. > :25:36.trying to negotiate. That said, they may find themselves blinking
:25:37. > :25:41.again and again, simply because they are being gamed into making
:25:41. > :25:45.the big payments and transfers, because it is so catastrophic what
:25:45. > :25:55.will happen if they don't. What should western Governments be doing
:25:55. > :25:58.
:25:58. > :26:02.now? They have to stop the panic here. That is the number one
:26:02. > :26:07.problem. I think over the longer term there is a huge overhang of
:26:07. > :26:13.debt, public, private, external debt, that gradually needs to be
:26:13. > :26:17.deflated out of the of the system. Some through growth, there are very
:26:17. > :26:20.few historical experiences where that has been very successful.
:26:20. > :26:23.Except in cases like Canada and Sweden, where the Governments were
:26:23. > :26:31.very large, and they were able to shrink them and make the economies
:26:31. > :26:34.much more efficient. I look at the European situation, as something
:26:34. > :26:37.impossible will happen. One that the euro will be allowed to
:26:37. > :26:41.collapse, that is unthinkable, impossible. The other is the
:26:41. > :26:45.Germans will accept lots of debt relief, plus inflation, plus
:26:45. > :26:49.temporarily large open-ended lending, which is impossible. One
:26:49. > :26:53.of those two impossible things will happen. It is an awesome choice. It
:26:53. > :26:57.is not something, they will not have years to dither over this,
:26:57. > :27:01.they have months to dither over this. It is moving very fast.
:27:01. > :27:04.Rather surprisingly a survey out tomorrow, of how confident British
:27:04. > :27:07.consumers feel, will show their slightly less gloomy than they were.
:27:07. > :27:10.But the facts about the state of the economy in this country, even
:27:10. > :27:16.without the collapse of the eurozone, are awful. The
:27:16. > :27:22.Chancellor's sticking to his line that there is no alternative to his
:27:22. > :27:26.austerity prescription. Not for him, the great economist, John Maynard
:27:26. > :27:36.Keynes, said when the facts change I change my mind, what do you do.
:27:36. > :27:37.
:27:37. > :27:42.First let's have this. "To understand my state of mind",
:27:42. > :27:47.John Maynard Keynes wrote to his friend, George Bernard show, he
:27:47. > :27:51.said he would be writing a book on economic theory, that would largely
:27:51. > :27:54.revolutionise, not at once, but in the course of next ten years, the
:27:54. > :28:00.way the world thinks about economic problems. It was a bit of a brag,
:28:00. > :28:05.even to a friend, but as it turns out, even he was underplaying it.
:28:05. > :28:09.Keynes ideas are still in play, nearly 70 years later. In the
:28:10. > :28:13.summer of 2010, the Chancellor, George Osborne put in place his own
:28:13. > :28:18.theory. Massive spending cuts, driven by a need to placate the
:28:18. > :28:23.international bond markets. This Emergency Budget deals decisively
:28:23. > :28:29.with our country's record debts. It pays for the past and plans for the
:28:29. > :28:35.future. His opposite number, retaliated. With a modern day case
:28:35. > :28:40.for Keynesian spending. coalition should act quickly and
:28:40. > :28:45.decisively to reverse George Osborne's cuts and for household
:28:45. > :28:51.budgets this year. We should reinstate vital investment for jobs
:28:51. > :28:56.now. Here on the corner of John Maynard Keynes's street, is a
:28:57. > :29:00.building site that exsemplifies his ideas of yesterday, he believes if
:29:00. > :29:03.the economy isn't involved in the private sector, the Government has
:29:03. > :29:10.no choice, the Government has to intervene. He said, tongue in cheek,
:29:10. > :29:14.what you should do, is take bottles, and fill them with pound coins, and
:29:14. > :29:19.put them at the bottom of the large well and put it down there. The
:29:19. > :29:24.employment of getting the bags out would stimulate the economy. That
:29:24. > :29:28.is where critics of the Government say we are now. On the one hand you
:29:28. > :29:32.have �700 billion of public sector private assets that they don't want
:29:32. > :29:35.to spend. And there is historic low rates of borrowing that the
:29:36. > :29:42.Government enjoys and could be better used to stimulate the
:29:42. > :29:45.economy. That is what they think should be done and they are still
:29:45. > :29:47.Keynesian followers. The Government could actually restore some of its
:29:47. > :29:51.capital programmes that have been cut. For example, the school
:29:51. > :29:57.building programme has been cut by 80%. I think much of those cuts
:29:57. > :30:00.should be reversed. There are other programmes which would be better to
:30:00. > :30:02.be done by a national investment bank. Because that would get a lot
:30:03. > :30:08.of the spending off the Government's balance sheet, if
:30:08. > :30:12.people are worried that the Government is being profligate.
:30:13. > :30:20.Critics of neo-Keynesian sound warnings. They point out our
:30:20. > :30:23.economy has generous automatic fiscal monitor, spending rising.
:30:23. > :30:26.They say the Government is borrowing a fair amount, not much
:30:26. > :30:32.less than a Labour Government would have done. The Government is
:30:33. > :30:37.spending close to 50% of GDP, their plan is to get down to to 40% over
:30:37. > :30:42.the next couple of years. If they want to provide confidence in the
:30:42. > :30:45.economy, what they need to be doing is getting close to 30%. That would
:30:46. > :30:49.also allow tax cuts, that would encourage private investment.
:30:49. > :30:52.are many reasons why the Government doesn't think the time is right for
:30:52. > :30:56.apartheid of pronounced Keynesian spending. But there are two that
:30:56. > :31:00.stand out. The first one, according to the ideas of the man himself,
:31:00. > :31:03.you don't run a deficit during a time of economic boom. The current
:31:03. > :31:09.Government believe that is exactly what the previous Government did,
:31:09. > :31:12.and they are now dealing with the effects of it. There is also
:31:12. > :31:16.unfunded pension liabilities, that this Government is also trying to
:31:16. > :31:19.deal with. They believed Keynes didn't have them at the time of his
:31:19. > :31:24.writing, and you can't keep kicking a debt can down the road.
:31:24. > :31:28.Nonetheless, the Government is due to launch new programmes of
:31:28. > :31:32.infrastructure investment soon. The debate is shifting towards a
:31:32. > :31:42.different Keynesian insight, that monetary policy could do more heavy
:31:42. > :31:43.
:31:43. > :31:46.lifting. The Bank of England should set nominal GDP rates, musing from
:31:46. > :31:52.the builders until then, they wonder where he buried the pound
:31:53. > :31:56.coins. Paul Krugman is here, Jon Moulton
:31:56. > :32:01.joins him, and Andrea Leadsom, a Conservative MP, who previously
:32:01. > :32:05.worked in finance for 20 years. You have given George Osborne quite
:32:05. > :32:08.a lot of ear ache about his handle of the economy. Have you seen
:32:08. > :32:11.anything while you have been over - - handling of the economy, have you
:32:11. > :32:15.seen anything while you have been over here to change your view?
:32:15. > :32:18.have had two years of austerity here and elsewhere. What we have
:32:18. > :32:22.seen, first of all, is austerity really does contract the economy.
:32:22. > :32:29.That the notion that it would inspire business confidence, and
:32:29. > :32:34.lead to expansion, not contraction, has been decisively proved wrong
:32:34. > :32:38.here and across the continent. Secondly, there is growing evidence
:32:38. > :32:42.that austerity, in these conditions, doesn't even work in fiscal terms.
:32:42. > :32:47.Because it shrinks the economy now and also shrinks the economy in
:32:47. > :32:51.future. It hurts the economy's long-run potential, which reduces
:32:51. > :32:55.future revenues, which worsens the long run budget position. I have
:32:55. > :32:59.used the analogy, it is like medieval doctors that thought you
:32:59. > :33:02.could treat a sick patient by bleeding, the patient got sicker
:33:02. > :33:08.and they said, bleed more. That is what is happening. You have a debt
:33:08. > :33:13.problem that is real, and the treatment is making things worse,
:33:13. > :33:18.even in fiscal terms. Why are you shaking your head, this is a Nobel
:33:18. > :33:21.Prize-winning economist? I find his view reckless, frankly, I can't
:33:21. > :33:26.believe that somebody as incredibly highly regarded could honestly
:33:27. > :33:30.think that the answer is to go and borrow more money. It is very
:33:30. > :33:35.simple mathematics, if you are in a hole, if you have overspent and
:33:35. > :33:40.overspent, spending more is simply not going to help. It will make
:33:40. > :33:44.things worse. You talk about austerity, in reality this is
:33:44. > :33:49.austerity light. If you really wanted to sort the economy, they
:33:49. > :33:54.would be doing it far faster with a shorter, sharper hit to get us
:33:54. > :33:57.rebounding sooner than we can. There are a lot of ways to answer
:33:57. > :34:00.that. The main thing to say, if you try to have a situation that
:34:00. > :34:04.everyone is trying to slash at the same time, which the private sector
:34:04. > :34:08.is trying to slash spending cuts, it feels it has too much debt, and
:34:08. > :34:11.the Government is also saying we have too much debt, we are all
:34:11. > :34:15.trying to slash. Then we run up against the fundamental fact that
:34:15. > :34:19.we are not a household, but an economy. And your spending is my
:34:19. > :34:23.income, and my spending is my income. And if we are both doing
:34:23. > :34:30.the slashing at the same time, what we end up doing is producing a
:34:30. > :34:39.depression that leaves us worse off. This is another thing, 1930s
:34:39. > :34:43.American economist, Irvine Fisher, Keynes plentor, he said if
:34:43. > :34:48.everybody tries to pay down debt, the more people save and the more
:34:48. > :34:57.they owe. We are worsening the debt problem by not allowing the
:34:57. > :35:02.Government to be the stablising factor. Even I struggle to attack a
:35:02. > :35:06.Nobel Prize winner, but I think you are seriously wrong. The issue
:35:06. > :35:11.about austerity is we have too large a state. We have let the
:35:11. > :35:16.economy go from 30 % odd, to pushing 50%, public sector. If you
:35:16. > :35:20.want growth you need a larger private sector, not a larger public
:35:20. > :35:24.sector. You are also ignoring, as your book does, I have just been
:35:24. > :35:29.reading it, waiting to come on, the very simple moral dimension of what
:35:29. > :35:33.you are recommending. That is we run up more debt. The only thing
:35:33. > :35:38.that debt does, it enables us to live better today, at the expense
:35:38. > :35:43.of those who follow us. That is a serious moral argument, and you
:35:43. > :35:47.cannot ignore it. I would put the moral argument in a different way,
:35:47. > :35:49.if I think about the future generation, the crime we are
:35:49. > :35:55.committing against the next generation, is not that we will
:35:55. > :35:59.leave them with more debt. That is a venal sin, the crime is all the
:35:59. > :36:03.students are graduating from college with no job prospects.
:36:03. > :36:05.Graduating with debts they have incurred to get an expensive
:36:05. > :36:09.education, and then there is no jobs. The damage we are inflicting
:36:09. > :36:14.on the next generation, by not having jobs for them. Which is the
:36:14. > :36:18.result of misguided austerity right now. That is the great sin. Those
:36:18. > :36:22.jobs will be generated when people move from the public sector to the
:36:22. > :36:27.private sector. What we need to be doing, is really making it easier
:36:27. > :36:32.for young people to start their own businesses, making it far easier
:36:32. > :36:36.for new entrepeneurs, you say we have to create jobs. We shouldn't
:36:36. > :36:39.be about creating jobs, but about enabling the economy to create jobs,
:36:39. > :36:43.low tax regimes, and opportunities for people to start up new
:36:44. > :36:47.businesses and so on. The average young person is not going to start
:36:47. > :36:50.a business. Why not? There has to be an expanding economy which is
:36:50. > :36:54.not happening, it is not happening because we are not providing the
:36:54. > :36:57.necessary support. By the way, I think you have just given me
:36:57. > :37:01.confirmation that something people like me tend to say. Actually none
:37:01. > :37:05.of this is at all about fiscal responsibility. It is about
:37:05. > :37:08.exploiting the current situation to pursue an ideolgical goal of a
:37:08. > :37:13.smaller state. You know, we can argue about whether the British
:37:13. > :37:17.state is too large, but look at Sweden. Which is weathering it very
:37:17. > :37:21.well, with a much larger state than you have. That is a great diversion,
:37:21. > :37:24.that is suggesting it is not sincere, it is not the budget
:37:24. > :37:32.deficit that is concern you, you are looking for a way to exploit
:37:32. > :37:37.the deficit situation. You accuse - - we accuse you of being wrong, and
:37:37. > :37:40.you accuse us of lying. You are mingling concepts that are separate.
:37:40. > :37:45.There is clear economic evidence, and you must accept as evidence,
:37:45. > :37:51.not they are hey, that, on average, larger public sectors grow slower
:37:51. > :37:54.than smaller ones. I don't accept that at all, we could have that
:37:54. > :38:01.discussion but we need equation charts for that. That is not true.
:38:01. > :38:05.So Mr Alfonso's study is rubbish. The question of size of the state,
:38:05. > :38:08.and the question of what one should be doing right now it deal with
:38:09. > :38:13.this crisis, ought to be separate. Surely there has to be a point that
:38:13. > :38:16.you can either expand your private sector, by making it easier for the
:38:16. > :38:20.private sector to expand. Or you can expand your public sec to and
:38:20. > :38:26.the only way to do that, is by removing wealth from the private
:38:26. > :38:30.sector, to put into the public sector. You are missing a point of
:38:30. > :38:33.what it means to be in a depression. We are not going into a depression.
:38:33. > :38:37.We are in a depression, there are vast numbers of workers idle who
:38:37. > :38:41.want to work. There is vast amounts of capital going nowhere, because
:38:41. > :38:44.there is no demand. At this point of time, the private and public
:38:44. > :38:48.sector are not competing for resources, there are unemployed
:38:48. > :38:57.resources, the point is to put them to work. Give me a recovery, in the
:38:57. > :39:00.UK or US, and I will become a fiscal, be happy to find ways to
:39:00. > :39:05.discuss about Government spending and raising revenue, in the US that
:39:05. > :39:09.needs to be part of the solution. Not now, not under these conditions.
:39:09. > :39:15.Don't you think efforts to reduce corporation tax, to deregulate, to
:39:15. > :39:20.make it ease your to start new companies, to -- easier to start
:39:20. > :39:23.new companies, and make it easier for banks to lend. To improve the
:39:23. > :39:27.private sector of the economy, that will have more impact than
:39:27. > :39:31.borrowing more money to create jobs and throw money at things. We have
:39:31. > :39:34.survey evidence in the United States about what it is that is
:39:34. > :39:38.holding private businesses back. Overwhelmingably the answer is lack
:39:38. > :39:43.of sales. There is not enough demand. Constraints on capital is
:39:43. > :39:47.not an issue. They would like to have more skilled workers, no more
:39:47. > :39:51.so than usual. Issues about financing are small issues,
:39:51. > :39:54.concerns about future Government regulation, they always complain
:39:54. > :40:00.about that, no more than usual. What has changed is there is no
:40:00. > :40:04.demand, there is no market there. That is what the austerity policies
:40:04. > :40:11.are worse, they are inhibiting the private sector as well as the
:40:11. > :40:14.public. Not all of the policies have failed. Every success story
:40:14. > :40:18.includes either high interest rates to start with, so you could bring
:40:18. > :40:23.them down. Or a situation where you have a large currency devaluation,
:40:23. > :40:26.that won't work now, you have to have some prosperous economy to
:40:26. > :40:30.devalue against, there is nobody out there now. There is, a clear
:40:30. > :40:33.example, Estonia. It doesn't fit the story at all. I don't think we
:40:33. > :40:36.have the evidence on the Estonia example, and we haven't time to go
:40:36. > :40:40.into it. I would love to. Come back and tell
:40:40. > :40:43.us all about it. The people of Ireland get to vote
:40:43. > :40:46.tomorrow on whether to swallow the medicine prescribed by Europe, it
:40:46. > :40:49.is a quirk of the institution constitution that it requires a
:40:49. > :40:53.referendum for the country to decide whether to accept a treaty
:40:53. > :40:57.that most of the rest of the eurozone has already agreed to. The
:40:57. > :41:00.Irish have a habit of rejecting EU treaties in referendums, and then
:41:00. > :41:09.accepting them when they are told to come up with the right
:41:09. > :41:14.conclusion. It was a Drome house, which turned into a nightmare
:41:14. > :41:20.mansion. Vacant and abandoned, after its owners' fortunes went the
:41:20. > :41:25.same way as the once booming island. Julia still work, but can't afford
:41:25. > :41:28.the mortgage any more, she survives by selling her furniture, and votes
:41:28. > :41:31.no in the referendum. This country is in a mess, because of the lack
:41:31. > :41:35.of regulation and the banks throwing money at people. Nobody is
:41:35. > :41:38.taking responsibility at the top, people like myself I lose my entire
:41:38. > :41:42.life earnings, and people in more dire situations, who are struggling
:41:42. > :41:46.to put food on the table. They are paying the penalty, the people at
:41:46. > :41:50.the top are being protected. That is wrong. Many of Ireland's middle-
:41:50. > :41:54.classes feel the same way, most of those voting no come from the less
:41:54. > :41:59.well off strands of society. People have seen their standards of living
:41:59. > :42:04.squeezed. And Sinn Fein, with less than 10% of the seats in Irish
:42:04. > :42:09.parliament, have stopped into that anger by urging a no vote.
:42:09. > :42:12.biggest thing the no vote would do, is to send clearly a signal to our
:42:12. > :42:17.own Government, but then to our European partner, that it is the
:42:17. > :42:20.considered view of the Irish people that austerity has failed. It is
:42:20. > :42:26.therefore the responsibility of democratically elected Governments
:42:26. > :42:29.and politicians, to come up with the Plan B. The yes side is
:42:29. > :42:33.represented by the vast majority of political parties in Ireland, they
:42:33. > :42:38.are warning voters if the Fiscal Compact is reject, Ireland might
:42:39. > :42:42.not be able to get a second bail out in 2014, if one was required.
:42:42. > :42:47.It is a tough sell, in any circumstance, where you have high
:42:47. > :42:49.levels of unemployment, and people are hurting. Aren't they voting yes,
:42:49. > :42:53.because they are afraid, rather than because this is the right
:42:53. > :42:56.thing, the right forward path? think they are voting yes because
:42:56. > :43:00.they want an insurance policy of funding there, if we cannot get
:43:00. > :43:04.back to the markets. They are voting yes because they want proper
:43:04. > :43:07.fiscal discipline, they don't want to go through the boom to bust
:43:07. > :43:12.nonsense we have seen over the course of the last number of years.
:43:12. > :43:16.They want certainty with this treaty. This treaty provides that.
:43:16. > :43:20.Dublin's Docklands symbolises the boom and bust that was the Celtic
:43:20. > :43:24.Tiger era. The bridges, banks, hotels that shot up in the last few
:43:24. > :43:29.years, showed aspiration and growth, it all ended badly, symbolised in
:43:29. > :43:34.the building over my shoulder, which would have been Anglo-Irish
:43:34. > :43:38.bank's head quarter, before it collapsed and taking with it --
:43:38. > :43:44.headquarters, before it collapsed and took the economy with it.
:43:44. > :43:49.House buying is non-existent, but the Irish export system is booming,
:43:49. > :43:55.with niches in pharmaceuticals and technology. This man runs one of
:43:55. > :44:00.the biggest exporters in Ireland. If we can manage our way through
:44:00. > :44:04.the next two years, combine that with certainty coming out of Europe,
:44:05. > :44:09.which will trigger economic growth and economic activity. Then I think
:44:09. > :44:14.you will see a very different Ireland. And that is why we have to
:44:14. > :44:18.vote yes tomorrow. We're not voting for tomorrow, we are voting for the
:44:18. > :44:22.Ireland of two years from now. We're voting for the Ireland of 40
:44:22. > :44:27.years, for our grandchildren. But Ireland's young people may not
:44:27. > :44:30.be able to wait a few years, they are already emigrating at a rate of
:44:30. > :44:35.1,000 a week, not all have lost their sense of humour. You find it
:44:35. > :44:38.interesting, you guys have seen the protests and the indignation in
:44:39. > :44:43.Spain, the people of Greece taking to the streets and burning down
:44:43. > :44:48.Athens. Part of you thinks, why doesn't it happen in Ireland, and
:44:48. > :44:51.you think, we just don't have the weather for it. I'm not paying any
:44:51. > :44:55.debt, people say that is irresponsible, what would happen if
:44:55. > :44:58.everybody stopped paying their debt? We would be debt-free.
:44:58. > :45:02.I decided to do my own little stand-up, afterall, how difficult
:45:02. > :45:07.with it be? The reason we are here is because we are looking at the
:45:07. > :45:14.treaty. And I was hoping to canvas your views, because unlike so many
:45:14. > :45:20.of your peers, you haven't emigrated, yet. So all of you, how
:45:20. > :45:26.many are "don't know", you will vote in the next 48 hours and you
:45:26. > :45:31.still don't know. Can I ask someone why you don't no. Did you raise
:45:31. > :45:37.your hand? Who raised their hand and said they did know. Why don't
:45:37. > :45:41.you know? No pressure? I haven't really looked into it. Despite the
:45:41. > :45:46.gallows humour, and the high number of undecided vote erts, even at
:45:46. > :45:49.this late stage, both sides of the debate agree that Ireland faces a
:45:49. > :45:53.few more years of austerity, irrespective of the outcome.
:45:53. > :45:56.Allegra Stratton is back with us to tell us what has happened with the
:45:56. > :46:04.Prime Minister's former head of propaganda, Andy Coulson. What was
:46:04. > :46:09.his former title? Head of Communications. He has been
:46:09. > :46:14.arrested? Before we went on air, he was charged and arrested. He was
:46:14. > :46:19.detained at 6frplt30am in his home in south London in Dulwich, they
:46:19. > :46:24.drove him, not train nor plane, they drove him to Glasgow, arrived
:46:24. > :46:27.at 3.30, six hours of questioning, then announced they were charging
:46:27. > :46:32.and arresting. It is down to the Scottish authorities to figure out
:46:32. > :46:38.what they will do next. offences? Related to his appearance
:46:38. > :46:42.at a Tommy Sheridan trial. charge? Perjury. That is serious?
:46:42. > :46:48.Taken very seriously up there, more so. The problem for the Prime
:46:48. > :46:52.Minister is twofold, firstly, it is something he is alleged to have
:46:52. > :46:57.committed while working for the Prime Minister. A different
:46:57. > :47:00.category of things he is accused of. It reminds us ahead of the Jubilee
:47:00. > :47:03.weekend, that no matter how hard the Government tries to disentangle
:47:03. > :47:07.itself from News International, every time they try they get
:47:08. > :47:11.dragged back by forces beyond their control. Thank you very much. It is
:47:11. > :47:15.on most of tomorrow morning's front pages, of course, if I knew I had
:47:15. > :47:20.time to show you I would. I don't have time to show you, that is the
:47:20. > :47:23.Guardian there. He's on most of the others as well. That's all for
:47:23. > :47:33.tonight, James Bond is here tomorrow, but until then, good
:47:33. > :47:33.
:47:33. > :47:37.tomorrow, but until then, good night.
:47:37. > :47:42.The heavy, thundery showers in eastern England is clearing away,
:47:42. > :47:45.only to be replaced by cloud and rain tomorrow, across the northern
:47:45. > :47:48.half of the UK. To the south it will be dryer and brighter, that is
:47:48. > :47:51.where we have the last of the warmth. The rain sets in for
:47:51. > :47:56.northern England, it will be a cool day here. A bit of raib from time
:47:56. > :48:02.to time in the Midlands, after a bright start East Anglia could see
:48:02. > :48:05.rain late in the day. Southern most parts of England, dry and bright,
:48:05. > :48:09.sunshine from time to time, here we have the last of the warmth.
:48:10. > :48:15.Temperatures 18-19, not as warm as today. South Wales doesn't look too
:48:15. > :48:19.bad, mid-and North Wales will see some rain at times, in the hills
:48:19. > :48:24.and mountains. In Northern Ireland a poor day, rain all day, some of
:48:24. > :48:28.which heavy. The rain in Scotland gets as far north as Inverness and
:48:28. > :48:32.Aberdeen. It will be heaviest late morning, early afternoon, the rain
:48:32. > :48:36.becomes lighter during the latter part of the day. A pretty poor day
:48:36. > :48:40.across many northern parts of the UK. It should be dryer and brighter
:48:40. > :48:44.for most areas on Friday. As you head further south, there is a lot