[Text/Observer Network Liu Chenghui] After being widely criticized, British Prime Minister Tras was forced to modify the new economic plan that was just launched last month. On October 15th local time, US President Biden said in an event that the initial economic plan of Tras was a "mistake", and he was not the only one who thought so. The British " Financial Times " noticed that this is Biden's "hardest criticism" of Tras' fiscal policy so far.
The Financial Times reported: Biden called Trass’ tax policy a mistake
Biden was asked by a reporter when attending an event in Portland, Oregon on the 15th, and talked about the UK’s economic policies during the period. He said that in the face of market turmoil and domestic political pressure, Tras' adjustments to the implementation of key tax cuts in the economic plan are "foreseeable."
"I want to say that I'm not the only one who thinks it's a mistake," Biden told reporters. "I think the idea of a super rich man's tax cut... Anyway, I just think... I don't support this policy, but it's up to the UK to judge, not me."
Reuters said that White House has previously refused to comment on the Trass economic plan. The Financial Times also noticed that since the UK fell into financial turmoil, senior Biden administration officials have avoided criticizing the British government too harshly in public. This remark is Biden's "hardest criticism" of the Trass administration.
Biden was interviewed by a reporter at an ice cream shop in Portland on the 15th (Fox News)
From April to July this year, the inflation level in the UK set a record high in 40 years. In order to curb high inflation, the Bank of England has raised interest rates seven times in a row since December last year. On September 23, the Tras administration, which had been in office for less than a month, announced the implementation of the country's largest tax cuts in 50 years, but it was questioned and criticized by the outside world, causing market turmoil. The exchange rate of GBP 2 against the US dollar once hit a record low...
US Treasury Secretary Yellen told the media last week that in an attempt to curb inflation, the UK's fiscal policy needs to show a "supportive" role.
Subsequently, the Trass government made a continuous "180-degree policy turn", first withdrew one of the tax cuts for high-income earners, and then canceled another key content in the economic plan, and eventually raised the corporate income tax rate. On October 14, in order to maintain the position of Prime Minister, Tras also announced the dismissal of his staunch ally, British Chancellor Kwoten, and appointed Hunter as the new Prime Minister.
Biden was also asked about the rise of dollar index on the same day. In order to cope with the historic inflation , the Federal Reserve "sky" along the road to rapidly tightening policy interest rates. On September 21, the third consecutive rate hike of 75 basis points was stimulating the US dollar index to accelerate its rise, and other major currencies in the world continued to depreciate against the US dollar.
However, Biden told reporters that he is not worried about the strengthening of the dollar, and he is worried about "the rest of the world".
"From the inside perspective, our economy is very strong. Inflation is a global problem, and the situation anywhere else is worse than that of the United States."
"The problem is that other countries lack economic growth and sound policies, and our situation is different," Biden said.
It is worth noting that " Wall Street Journal " published an article on September 18 warning that "the strengthening of the US dollar will cause trouble for global economy ." The article points out that as the dominant currency in global trade and finance, the fluctuations in the US dollar will have a wide impact on the global economy. Although the stronger dollar will help alleviate its own inflation, this will further suppress global economic growth and exacerbate the inflationary difficulties faced by global central banks, especially causing lasting damage to emerging markets and even developing economies.
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