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The Issue Candidates Avoided in the TV Debate

Mervyn King, the governor of the Bank of England, is reported to have told the US economist David Hale that whoever wins the UK election on May 6th could become so unpopular that their party will not get back into power for a generation.

Sharon Lorimer

This unpopularity will be caused by the very tough decisions that need to be taken to rein in government spending and protect Britain's market credibility, according to King.

Following the last of three US-style TV prime ministerial debates on Thursday night, one has to ask if the two main parties are aware of this and are actually trying to avoid forming the next government.

The outright winner in the battle to lose the election is incumbent Gordon Brown.

Having taken over from Tony Blair after 10 years serving as his Chancellor, Brown has been grappling with the biggest financial crisis in the UK since George Soros and other speculators forced Britain out of the Exchange Rate Mechanism (front runner to the euro) in 1992.

Having hosted a G20 meeting in London early last year that helped shore up confidence in the financial system, Brown is well respected on the international stage.

But in the UK the unelected prime minister is probably the most unpopular leader the country has known since before the Second World War.

Looking uncomfortable in his own skin when in front of the cameras, Brown finds himself in the uneasy position of having lectured the British people for years on prudence and telling anyone who would listen that there will be "no more boom and bust."

Following Thursday's final debate and a gaffe in which he called a voter a "bigot" while still wearing a microphone from a previous interview, Brown is widely seen as a dead-man walking.

His party, which has toyed with the idea of ousting the uncharismatic PM on more than one occasion, is now facing the prospect of losing the huge majority that Tony Blair won for them in 2005.

David Cameron, the leader of the opposition Conservative Party, was 20 points ahead in the polls last year and widely expected to sweep the victory against such an unpopular leader. Unfortunately for Cameron, he has not been able to seal the deal with British voters.

A better showing in the third and final debate has given his supporters some hope that he will be able to win a majority next week, but his message of austerity for "Broken Britain" has failed to galvanize voters.

Cameron's failure to capture the imagination and own the change story has allowed Britain's third party, the Liberal Democrats, to gate crash the two-party system. After a strong showing in the first debate Nick Clegg, the Liberal leader, has found himself neck and neck with Cameron in the polls.

Despite facing increased scrutiny from the public and his two opponents, Clegg remains a major factor that is likely to lead to a hung parliament.

The Hidden Issue Nobody Speaks About

Everyone knows that massive government spending cuts are needed over the next 5 years and whoever forms the next administration will have to credibly bring down the budget deficit or risk Britain's triple-A credit rating.

The National Institute for Economic and Social Research predicts £30 billion ($46 billion) will need to be saved while income tax will need to rise by six pence in the pound to simply bring the UK budget deficit back down to three percent.

None of the three candidates has yet told voters how they would achieve this, for fear it will damage their election campaign.

Issue number two is the City of London and the banking industry. Amid widespread anger at the collapse of the banking industry and the bailout of the likes of Royal Bank of Scotland and Lloyds Banking Group , banker bashing has become a national sport to rival soccer.

Gordon Brown was able over the last 13 years to boost welfare spending in part because of the tax revenue Britain's role as a financial power house had afforded the country. In the good times, huge bonuses where not a problem, because 40 percent of the cash went straight into the Treasury's accounts.

All that has changed, and with the highest rate of income tax now at 50 percent, there are fears amongst those in the City that business and talent could be lost to New York, Hong Kong or Shanghai.

How these two challenges are handled will define the next government's first year in power, but Britain's long-term future will be defined by an issue that has hardly been mentioned in this election campaign.

Debtor Nations
Debtor Nations

China and India are widely expected to drive global growth for the next century. Talk to any CEO of a globally-focused company and they will tell you their business' future lies in meeting soaring demand from the two emerging economic power houses.

South East Asia, Australia, Canada, the middle-east, South America and even Japan are being driven by soaring demand for raw materials and goods from China and to a lesser extent, India.

Unfortunately, hardly a word has been said by any candidate on how Britain can join this party. Within Europe, only Germany is truly cashing in on the Chinese growth story via its huge exporting base. In Britain nobody even discusses how the country can benefit from the trend.

With more and more Chinese students at British universities, you would think the government would be sending its young to learn in Beijing or Shanghai and would be pushing students to learn Cantonese or Mandarin.

How to use Britain's competitive advantage in areas like financial services, pharmaceuticals and communications to profit from the transformation of China and India should be dominating the political and economic debate as the country heads to the polls.

It is not, and the nation that brought the world the industrial revolution, Monty Python and the Beatles is engaged in a narrow-minded conversation that will, if not addressed, accelerate Britain's relative decline on the global stage.

Austin Powers lost his Mojo but Hollywood gave it back to him; it looks unlikely that Brown, Cameron or Clegg can do the same for Britain.