Economy

What a curious speech by Nick Clegg to the CBI last night. Curious, not because it was bad — but because, in straining to give a uniquely "liberal" justification for deficit reduction and the spending cuts, the Deputy Prime Minister actually crafted an address that most Tory ministers should, and would, deliver themselves. Take his "liberal analysis" of the last decade: "On a liberal analysis, the last decade represented the worst of all worlds. On the one hand: unchecked private debt; an unsustainable housing market; an overleveraged banking sector; overreliance on City-based financial services while other regions and sectors suffered neglect.

David Cameron has a good relationship with Barack Obama, which will be on display when the US president visits Britain shortly. They speak regularly and frankly and their senior advisers are in near-constant contact. The idea that the Lib Dems would foist a more "Love Actually" policy onto the coalition has come to naught. Yet Britain's influence in Washington has waned. This is no fault of the Prime Minister. In fact, his personal diplomacy has probably slowed-down the process. Instead it has to do with structural changes in the US: the coming to power of a "pacific" President, the importance of US-China ties, the emergence of the Tea Party.

With Dominique Strauss-Kahn, known as DSK, undertaking scientific and forensic tests to determine if he sexually assaulted a hotel maid, the International Monetary Fund will be run by its No. 2 official, John Lipsky. A former banker, Lipsky was appointed “first” deputy managing director in 2006, and was expected to step down later in the year. But the change at the top will bring the former Permanent Secretary of the Department for International Development, Minouche Shafik, into the limelight.

Gordon Brown may have gone, but advocates of his calamitous policies remain. David Blanchflower, the chief exponent of borrowing more, has a piece in The Guardian today which is worth examining. Written with his trademark chutzpah, it’s a very clear exposition of the Labour argument — along with its flaws. Here are some extracts, and my comments: "In his budget speech last month, Chancellor George Osborne suggested that he was hoping for 'an economy where the growth happens across the country and across all sectors. That is our ambition". Sadly, to judge by Wednesday's GDP figures, growth under this coalition remains just an ambition, a mere illusion." And why would that be? The GDP figures showed growth of 0.

I'm sorry to do this to you, CoffeeHousers, at the start of a bank holiday weekend — but I thought you might have a morbid sort of interest in Gordon Brown's latest role. Turns out that, as expected, our former PM is to join the World Economic Forum in an advisory capacity. He won't be paid for his work, although the Forum will cover his staffing costs. One of his spokespeople has told ITV's Alex Forrest that his task is to "stop the next financial crisis." Which is to say, he'll be saving the world. Again. If nothing else, it's yet another demonstration of Brown's peculiar resilience. Our former PM may be electoral anathema in these parts, but he clearly still holds some allure for the technocrats of Davos, Geneva and Bretton Woods.

Inflation - the cost of living - is the number one issue in Britain today. It is under-discussed in the House of Commons as MPs have no say in it: the task of controlling inflation lies with Mervyn King and his nine-strong Monetary Policy Committee, and its members are rarely interviewed. Little wonder, as a lot of them should be feeling fairly sheepish. But not Andrew Sentance. He's been arguing for a rate rise for months, and doesn't have long left to serve on the MPC, so he can speak quite freely. Inflation has been above target almost all the time he's been on the MPC, he says, so in what way can it be described as a blip?