Brown in the Big Apple

By staff

Gordon Brown is visiting New York today as part of a trip that will take him on to Brazil and Chile.

The prime minister repeated his arguments for further fiscal stimulus and an enhanced system of international financial supervision.

The trip comes as US president Barrack Obama wrote an article – published around the world – backing calls for a further “robust” and “sustained” stimulus.

He followed that with a Washington speech defending his recent plan to save America’s banks, framing the action in terms of job creation, a rejuvenated housing market and an increase in bank lending.

Speaking in his second prime-time news conference, Mr Obama asked Americans for “patience” as the country struggles to bring an end to the current recession.

The president’s comments come in a week when US treasury secretary Tim Geithner outlined plans to free-up frozen credit markets. A series of schemes will be initiated to entice private sector investors to buy up about $500 billion (£345 billion) of toxic debts.

Referring to other measures introduced as part of an $800 billion stimulus package, Mr Obama said: “We’ve put in place a comprehensive strategy designed to attack this crisis on all fronts.

“It’s a strategy to create jobs, to help responsible homeowners, to re-start lending and to grow our economy over the long-term. And we’re beginning to see signs of progress.”

He added: “We have made the tough choices necessary to cut our deficit in half by the end of my first term – even under the most pessimistic estimates.

“It will take time, it will take patience, and it will take an understanding that when we all work together, when each of us looks beyond our own short-term interests to the wider set of obligations we have to each other, that’s when we succeed.”

The $3.6 trillion (£2.5 trillion) budget will go before Congress this week and is expected to be met with opposition from both Republicans and Democrats.

But the Czech prime minister – who holds the rotating presidency of the EU – described the idea of another fiscal stimulus as “a road to hell”.

As Mr Brown left the UK, the controversy over Bank of England governor Mervyn King’s calls for the Treasury to show more caution over spending refused to die down.

David Cameron described the comment as one of the most important moments of the recession.

Shadow chancellor George Osborne said: “The governor is sending a very clear warning that this country cannot borrow its way out of debt.

“We are already heavily indebted and plans for a second stimulus package, which Gordon Brown has been talking up, should not go ahead.”

Later today, Mr Brown attended a Wall Street Journal question and answer session in New York earlier.

That will be followed by a further Q&A with university students before a visit to see Ban Ki-Moon, the secretary general of the United Nations.