March 24th, 2010
07:32 PM GMT
With weeks to go before Britain's national election, finance minister Alistair Darling has given his budget and economic projections for the fiscal year starting in April.
The markets want to see how the government will make deep budget cuts to bring down a budget deficit that rivals the one facing Greece.
Tax payers want to see the rich bankers pay more but do want to suffer from cuts in services.
Other governments want to learn how a major industrialized nation can cut spending without pushing a fragile economy back into recession and without triggering more strikes.
Truth is this budget may have to be torn up anyway. If the opposition Conservative Party takes power in May it will present a new and different budget –- one the ruling Labour Party says would contain damaging cuts.
The worst outcome for the bond, stock and currency markets would be an election where no party gets an overall majority.
That would leave too many unanswered questions about the direction of the economy.
For his part, Darling announced tax relief on cheaper homes, a tax hike on expensive homes and a redistribution of three billion dollars raised from taxing bank bonuses late last year.
Has he done enough to keep his party in power after 13 years?
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