Economic optimism turns to gloom

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Shoppers are tightening their belts as the economy fails to growThe UK is facing its worst economic crisis in 60 years, Chancellor Alistair Darling has said.

In contrast to earlier upbeat government statements, he told the Guardian newspaper the economic downturn would be more "profound and long-lasting" than most people had feared.

Here is a selection of key quotes from the chancellor and Prime Minister Gordon Brown over the past year, showing how optimism has given way to gloom amid rising inflation, falling house prices and slowing growth.

CHANCELLOR ALISTAIR DARLING - 30 AUGUST 2008

Mr Darling says economic times for the UK are "arguably the worst they've been in 60 years".

He adds: "I think it's going to be more profound and long-lasting than people thought."

CHANCELLOR ALISTAIR DARLING - 22 JUNE 2008

"Both Mervyn King and I have said that the economy, along with every other developed economy in the world, will slow down this year.

"That's been clear for some time."

We have got our work cut out Chancellor Alistair Darling <a class="" href="/1/hi/business/7589291.stm">Darling warns of economic crisis </a>

"We've also said though that in the face of inflationary pressures coming from the doubling of the price of oil, rising food prices, which is pushing inflation up in every country in the world now, that we've got to make sure that inflation doesn't take hold here in this country.

"Our economy along with every other economy in the world is going to be slowing this year. It will be difficult. It will be tough."

CHANCELLOR ALISTAIR DARLING - 5 JUNE 2008

Alistair Darling says the economy is "strong and resilient" and that employment levels are much higher than during the housing crash of the early 1990s.

But he adds that, in common with every other country, "We are feeling the effects of the problems that started in the financial markets and have spread to the wider economy."

PRIME MINISTER GORDON BROWN - 4 MAY 2008

"We have got to show, as we've done in the past, that we can come through this difficult economic times, make sure that people feel safer in their jobs and their mortgages and make sure also that people know that the economic plan that we have for the future is taking us out of the downturn and preparing for the upturn."

PRIME MINISTER GORDON BROWN - 27 JANUARY 2008

"Now in Britain, we are saying, as you know, that inflation is low, interest rates are low and we expect there to be growth.

"It's all the more remarkable that inflation generally is low, when you have, as everybody acknowledges, rising food prices round the world and rising oil and commodity prices."

CHANCELLOR ALISTAIR DARLING - 5 NOVEMBER 2007

"Despite this international uncertainty, which started from the problems in the US housing market, there are grounds for believing that we will get through this.

"We have a strong economy, its momentum will carry us through."

PRIME MINISTER GORDON BROWN - 23 SEPTEMBER 2007

"I think the choice is becoming pretty clear. Between a government that is determined at all times to maintain the stability and growth of the British economy.

"And I think we've proved over these last 10 years we can do it and will continue to do so, as against an opposition which I detect wants to cut taxes, raise spending, cut borrowing, put the stability of the economy at risk."