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The UK government is in chaos after shocking comments from Business Secretary Vince Cable who said that he had “declared war” on Rupert Murdoch and “could bring down the government” to an undercover reporter at the Telegraph.Cable has since been taken off Rupert Murdoch’s deal for his company News Corp. to buy the UK based BSkyB.
The Business Secretary role is a rather small one in the UK’s cabinet. Cable, known for being a boisterous character, was brought into the Liberal Democrat – Conservative government so he wouldn’t stand in opposition from the bank benches of Parliament. There he could have pulled LibDem votes away from the coalition who need them desperately to pass austerity cuts.
Cable is currently fighting against some of the more aggressive proposals made by the coalition from within the cabinet. And he likely has a lot more fighting to do, as the UK’s borrowing surged to its highest level ever in November.
Cable has apologized for his comments, but that doesn’t mean he’s going to be any different now. He still holds, what he calls, the “nuclear option.” If he walks out on the government, Cable believes it will fall and there will be another election.
Right now, that might not be such good news for the Conservatives or the Liberal Democrats. The debate and rioting over the increase in tuition fees has ignited the Labour base.
Labour is on 39%, the Conservatives 38%, and the Liberal Democrats 11% in the latest poll from Ipsos Mori.
If the government was to fall and an election held, it’s completely uncertain what the following government would look like. But if Ed Milliband’s Labour Party were to take control, or form a coalition with the more left wing Liberal Democrats, many of the cuts markets are banking on may disappear.
One of the reasons for the pound’s drop today.
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