Morning call: the pick of the papers

The ten must-read pieces from this morning's papers.

1. Out of the 'zone', but still in the soup (Independent on Sunday)

The problems of the euro could sink even those who wanted nothing to do with it, such as the Conservative Party, writes John Rentoul.

2. The banks will be forced to STOP gambling with your money... and they can meet the costs (Mail on Sunday)

Vince Cable pens an-oped.

3. Different century, same old friendship (Independent on Sunday)

In the immediate aftermath of the 9/11 attacks a new generation felt the emotional attachment between the UK and US, writes Louis B Susman, the US ambassador to the UK.

4. The fate of the Government is in George Osborne's hands (Sunday Telegraph)

In his Autumn Statement, the Chancellor must face down the Lib Dems, and set out a strategy to rescue us from economic ruin, argues Tim Montgomerie.

5. A simple truth to kill the big lie about 9/11 (Sunday Times) (£)

The lesson from September 11, 2001, is never ignore the obvious -- there is simply no need to introduce complexities to understand it, writes Christopher Hitchens.

6. The American dream, and the missing years (Independent on Sunday)

The terror attacks of 2001 ushered in a decade of wars that shattered Iraq and Afghanistan, leaving the world's only superpower robbed of its confidence and stripped of its illusions, writes Rupert Cornwell.

7. Stroppy Tories seem to have forgotten they didn't actually win (Observer)

Nick Clegg is delighted when Conservatives complain that he's stopping them from being more rightwing, writes Andrew Rawnsley.

8. While Galliano's outburst is publicly condemned, 'hate speech' becomes an online norm (Sunday Telegraph)

In our curiously fractured society, moving from offline to online discourse is like ricocheting from Switzerland to the Wild West, says Jenny McCartney.

9. And the award for the most pointless award goes to... GQ for naming George Osborne as the Politician of the Year! (Mail on Sunday)

Suzanne Moore is unimpressed with George Osborne's performance at the ceremony.

10. And Hate Begat Hate (New York Times)

The wave of anti-Americanism is rising in both Afghanistan and Pakistan, even among many who once admired the United States, writes Ahmed Rashid.

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Why relations between Theresa May and Philip Hammond became tense so quickly

The political imperative of controlling immigration is clashing with the economic imperative of maintaining growth. 

There is no relationship in government more important than that between the prime minister and the chancellor. When Theresa May entered No.10, she chose Philip Hammond, a dependable technocrat and long-standing ally who she had known since Oxford University. 

But relations between the pair have proved far tenser than anticipated. On Wednesday, Hammond suggested that students could be excluded from the net migration target. "We are having conversations within government about the most appropriate way to record and address net migration," he told the Treasury select committee. The Chancellor, in common with many others, has long regarded the inclusion of students as an obstacle to growth. 

The following day Hammond was publicly rebuked by No.10. "Our position on who is included in the figures has not changed, and we are categorically not reviewing whether or not students are included," a spokesman said (as I reported in advance, May believes that the public would see this move as "a fix"). 

This is not the only clash in May's first 100 days. Hammond was aggrieved by the Prime Minister's criticisms of loose monetary policy (which forced No.10 to state that it "respects the independence of the Bank of England") and is resisting tougher controls on foreign takeovers. The Chancellor has also struck a more sceptical tone on the UK's economic prospects. "It is clear to me that the British people did not vote on June 23 to become poorer," he declared in his conference speech, a signal that national prosperity must come before control of immigration. 

May and Hammond's relationship was never going to match the remarkable bond between David Cameron and George Osborne. But should relations worsen it risks becoming closer to that beween Gordon Brown and Alistair Darling. Like Hammond, Darling entered the Treasury as a calm technocrat and an ally of the PM. But the extraordinary circumstances of the financial crisis transformed him into a far more assertive figure.

In times of turmoil, there is an inevitable clash between political and economic priorities. As prime minister, Brown resisted talk of cuts for fear of the electoral consequences. But as chancellor, Darling was more concerned with the bottom line (backing a rise in VAT). By analogy, May is focused on the political imperative of controlling immigration, while Hammond is focused on the economic imperative of maintaining growth. If their relationship is to endure far tougher times they will soon need to find a middle way. 

George Eaton is political editor of the New Statesman.