Independence struggle

Mervyn King has fired what could be the first salvo in a wider war. The Bank of England governor’s warning that the government can’t afford another big fiscal boost should be seen as an attempt to avoid no fewer than three crises that could be looming: a fiscal crisis, a constitutional clash and an inflation crisis. The budget crisis is the most obvious one. The UK’s fiscal deficit will in the next financial year rise to 11% of GDP, according the latest International Monetary Fund forecast. For...