G20 MUST TAKE RADICAL MEASURES TO AVOID SLUMP, SAYS NICK CLEGG

guardian.co.uk
Press Association
Monday 30 March 2009 10.01 BST

Liberal Democrat leader warns that failure to agree on immediate
action could lead to a ‘dangerous market stampede’

Radical measures must be decided at the G20 summit or it could become
the "fateful moment" when the global recession lurches into an outright
slump, Liberal Democrat leader, Nick Clegg, said today.

Clegg said the meeting of world leaders in London this week was one of
"immense psychological importance" and warned that failure to agree
on immediate action could lead to a "dangerous market stampede".

Disunity could spark further panic among jittery markets, sending the
world economy into "freefall" and raising the spectre of a 1930s-style
depression.

Speaking ahead of the gathering on Thursday, Clegg said: "A grand
one-day summit cannot alone deliver us out of the global economic
crisis.

"But its timing, and the expectations raised, means that this week’s
meeting is of immense psychological importance. People desperately
need to see that their leaders are able to work together, take radical
decisions, and stick to a plan that offers hope.

"If not, this summit could become the fateful moment when recession
lurches into outright slump."

He called on the G20 to convey a sense to the world that there was
a way out of the current crisis or there could be "chaos" in the
financial markets.

Public disengagement from the political process could lead to a vacuum
that could be filled by "populism, manipulation and hate", he added.

He said: "There is a very real prospect that if the G20 does not
agree immediate action that re-injects confidence into financial
markets there will be yet another dangerous market stampede.

"The nerves of investors and institutions have already shown themselves
to hinge on the certainty provided by governments.

"Disunity and half-measures could well spark further panic, sending
the world’s economy into freefall and raising the spectre of a
1930s-style depression."

But there were obligations on opposition politicians not to will
negotiations to fail otherwise there could be a wholesale withdrawal
from mainstream politics.

He added: "We are at a psychological tipping point. History teaches
us that economic meltdown can lead to despair, despair to fury,
and fury to violence and extremism.

"We are on the verge of a profound disengagement from conventional
politics.

And the space that creates is too easily filled by populism,
manipulation and hate.

"It is the responsibility of all politicians to stop this, and that
means getting behind the G20 summit. Of course we must not suspend
scrutiny and we must continue unequivocally to speak out for what’s
right.

"But we must set aside the shallow wrangling. We cannot afford to
undermine the G20, we have to make it work."

Meanwhile religious leaders today urged the G20 leaders not to forget
their commitment to the world’s poorest people.

In a statement, they called on politicians to pay special attention to
the poor and vulnerable and state that "to forget their needs would be
to compound regrettable past failures with needless future injustices".

While acknowledging the "sheer complexity" of the challenge facing
politicians, the statement called on them to restore "that lost sense
of balance between the requirements of market mechanisms that help
deliver increased prosperity, and the moral requirement to safeguard
human dignity, regardless of economic or social category".

Figures including the archbishop of Canterbury, Dr Rowan Williams, the
archbishop of Westminster, Cormac Murphy-O’Connor, the chief rabbi,
Sir Jonathan Sacks, and the secretary-general of the Muslim Council
of Britain, Dr Mohammed Abdul Bari, have signed the statement.

Murphy-O’Connor said: "At a time of economic difficulty, it is
important for all political leaders not to forget their promises to
the world’s poor. We pray for the poor, vulnerable and marginalised
and also for the political leaders in their deliberations this week
as we seek to create a more just world."

Williams said people had high expectations of the meeting.

He added: "As religious leaders, we shall be praying that these
expectations will be met and that the gathered politicians will be
inspired to share a word of hope with all of us."

Among the 32 signatories are the chairman of the Christian-Muslim
Forum, Dr Musharraf Hussain Azhari, the general secretary of the Hindu
Council UK, Anil Bhanot, and the primate of the Armenian Orthodox
Church of Great Britain, Bishop Nathan Hovhannisian.