One of the winners of this year's Nobel Prize in economics has accused the British government of exaggerating the threat of a debt crisis and jeopardising the economic recovery with severe budget cuts. Prime Minister David Cameron has defended his government's plan to slash public spending, saying in a podcast that without austerity Britain is "looking down the barrel of economic ruin."
But London School of Economics professor Christopher Pissarides said there was "minimal" risk of Britain experiencing a sovereign debt crisis like the one that brought Greece to the edge of bankruptcy earlier this year. Pissarides wrote in the Sunday Mirror newspaper that unemployment was high and job vacancies few, and drastic spending cuts might make the situation worse.