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Pre-Budget Report

The hon. Gentleman is right, and I shall develop that point further in a few moments. The second point on which I agree with the hon. Member for Tatton—a point, indeed, that the Liberal Democrats have been making trenchantly—is that the banking crisis is almost certainly more important in terms of its impact on the economy, and we need to divert a good deal of attention to that problem. However, I disagree fundamentally with the hon. Gentleman's belief that there is no need for a fiscal stimulus. I think that that is absolutely wrong. The Conservatives—I shall say more about this later—are presenting themselves as the party of change which identifies with the change on the other side of the Atlantic, but while we sit here debating the issue, the incoming Obama Administration are discussing a fiscal stimulus that is 20 to 25 times bigger than what the British Government propose. It is also two to three times as much in relation to the American economy, and—in answer to the shadow Chief Secretary, the hon. Member for Runnymede and Weybridge (Mr. Hammond)—it starts from a point at which the Americans' debt position in relation to GDP is worse than ours. Nevertheless, they have to apply it.