How Gordon Brown should deal with the financial crisis


10:01 am - January 26th 2009

by Sunny Hundal    


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The Independent’s ComRes poll today, showing a big 15% lead for Conservatives over Labour, given it was only 1% two months ago, will cause more than a few in government to cry over their cereal.

What’s leading the “Brown backlash”? It’s not that most people blame Labour for this mess, as Anthony King said in December, because a recent Times poll flatly contradicted that. Moreover, Britons aren’t wary of state intervention, so its unlikely to be a backlash to recent nationalisations.

I said two months ago that Brown had not yet sealed the deal and I think its time to reiterate that again. The problem is that they still haven’t managed to convince the electorate they know what they’re doing and whether there is a long-term strategy behind it all.

Now, there’s two stages to this economic crises: the short term issue with bad loans and falling national output, and a longer term view on what went wrong. For a leftie (and this govt), there’s no point in making ideological recommendations about the first stage because it’s dependent on events that are spiralling out of control. We need a longer term narrative, as does the government, but that’s not the point of this piece.

The point here is to say the government needs to develop a sharper short-term narrative and find ways to argue Tories on that own territory and expose that there is no real alternative.

The Tories, naturally, have been all over the place. From opposing the nationalisation to now accepting a second bailout in inevitable, they’ve been unable to form a narrative. Hell, Ken Clarke has already started contradicting his leader’s hysterics about an IMF bailout.

1) First, Brown must explain constantly and clearly state why the bank-bailout is necessary: people’s savings, mortgages and the banking system is in danger of collapsing. The govt must constantly assert Tories have no other alternative to this, to force them to defend. It’s true, the Tories have no other plan.

2) The govt must also find surrogates outside the cabinet to push their talking points, especially people who know economics. Maybe even organise a ‘war strategy’ meeting of economists and publicly invite them to offer opinions in the way Blair did with Muslims following 7/7. That would be a good way to push surrogates out into the media (who are too lazy to seek out informed opinion on this cisis).

3) I agree with Benjamin Wegg-Prosser on LabourList: its time to ditch the Tories are ‘doing nothing’ attack-line and start attacking their ideas directly, but in a way that forces them to be defensive over Labour strategy. For example, why did the Tories shift from opposing nationalisation to accepting it? Didn’t they realise the extent of the problems?

4) I also don’t think this govt has talked about the economy enough. People are rightly worried – Brown needs to stop trying to play down the crisis because it won’t be a short one. Obama hasn’t – he rightly keeps pointing out that the crisis will be long and the journey painful. And there aren’t enough people talking about the crisis or what the govt is doing about it (keep repeating talking points).

5) Be more radical with a rescue and recovery plan because the Tory talking points (huge debt, low pound) have melted away. The Tories know they can’t avoid the spectre of bank nationalisation now. It would expose their lack of a narrative further.

6) Be more bullish about what needs to change over the long term. If necessary Brown should make a few YouTube videos explaining his economic thinking, if necessary in detail. It would get people watching to see whether their government has a handle on things.

7) Woo Vince Cable as Chancellor; the man is pure political gold. He is a fantastic communicator and has the right ideas. If Brown manages to woo him the polls will shift completely the other way.

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About the author
Sunny Hundal is editor of LC. Also: on Twitter, at Pickled Politics and Guardian CIF.
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Reader comments


“7) Woo Vince Cable as Chancellor; the man is pure political gold. He is a fantastic communicator and has the right ideas. If Brown manages to woo him the polls will shift completely the other way.”

Isn’t this a good reason as to why Vince Cable would not do it?

2. Alisdair Cameron

One (bloody huge) problem with all that, Sunny, is that it would require an almighty display of humility from Brown. Fat chance.
That’s asides from the fact that you’d be shoring up an administration that is illiberal and destroying civil liberties on a daily basis. I’m increasingly of the opinion that a hung parliament, or ‘no’ government (a la Belgium) mightn’t be the worst thing that could happen in the UK, or at least a Govt that concerned itself solely with narrow national economic measures.

like the ideas.

I think that all this reqd and especially so if we have no choice

(for reasons of stabilty and also because the pound in the pocket is becoming “worthless” otherwise)

to consider joining the euro. That in itself is going to raise 101 issues namely, a feeling of powerlessness amongst the English

i.e “why should JohnnyForeigner make all the decisions for us” and that inevitably leads to the question of the English devolution/Parliament/and all that.

“4) I also don’t think this govt has talked about the economy enough. People are rightly worried – Brown needs to stop trying to play down the crisis because it won’t be a short one. Obama hasn’t – he rightly keeps pointing out that the crisis will be long and the journey painful.”

True. But it was easier for Obama as his party have been the opposition for 8 years, while the British public know that the crisis is following 11 years of Labour governments so they will inevitably (and rightly so) link it to the Blair & Brown duo and their massive majorities.

think re humilty and PM Brown, I would say that there is such a thing as that there are forces beyond the knowledge of the common man and the bulk of society and the state

and that is the timing and the force of this financial hurricane,

and the whole world is in it.
Having said that, the UK is exceptional in Europe and outside the US in terms of national debt. Well it has been boxing above its weight in foreign affairs (i.e focussed on the Great in Great Britain) as we all felt misleading rich….and behind the scenes there has been furious attempt to redestribute wealth/resources,

The GREAT in Great britain is responsible for the unusual situation that Britain finds itself in.
and we are all , everyone of us, responsible for it, I think.

“The GREAT in Great britain is responsible for the unusual situation that Britain finds itself in.
and we are all , everyone of us, responsible for it, I think.”

Not me, thanks very much.

agree with Benjamin Wegg-Prosser on LabourList: its time to ditch the Tories are ‘doing nothing’ attack-line and start attacking their ideas directly

So are you now accepting that this was either a lie or an irrelevance? It was a lie actually .

Yes what you do not see here is that Brown is still doing remarkably well in the polls for a leader who was detested in a boom which has since turned into a catastrophe . In other words you have forgotten that if by some miracle Brown both handled the problems well and argued his way out of the fact he caused it as well he would be back where he was. He was respected as a sound Chancellor but overall disliked because he was a tax and spend socialist . That’s you starting point , not a make believe popular Brown. Not, you forget , a make believe popular Labour Party whose default position has been getting shown the door since Blair and before. Take a step back. That’s where you meet some voters
What is happening here is that what has already been over egged as a ‘crisis ‘ by Brown ( its not that bad come on…..arse, face about this you have ) , you are using the storm to avoid asking more fundamental question about Labour and how it is they have lost the confidence of the country . This is a, long term problem not a daily narrative fight .
The problem of the low pound and the rising debt have not melted away , and here you are into a fantasy world of your own . They have not melted away because they are keyed into the last ten years whereas your strategies only deal with a whose best argument most people ignore .

I do not think most people are unhappy with Brown as a man qualified to steer us though the storm . That is why he is doing much better than he ought to be actually gaining during recession . They do however recognise that we would be far better off if he had not presided over the shift of our economy to unproductive sinecures and suspect he is hiding a tax bombshell in borrowing . This will be worse than it might have been because he is still a tax and spend socialist . There is a also a back reading of his Ace , the man who delivered sustainable boom. This is now obviously a lie and it was largely an illusion built on debt . By fidlding with the headlines a you are avoiding the heavy lifting

So if you think Labour has a chance of winning the next election stop obsessing with alternatively accusing Conservative of doing nothing and doing the wrong thing .They do not have to do anything and it bores people. Go back to basics and appreciate that Labour has to solve the electoral problem that existed before this , for them , fortunate problem .

Too much tax
Too much ordering everyone around
Too much hated progressivism
Too much favouring of the Public Sector
Too Scottish
Too European
The Party who hates you if you are working white married and ordinary

That is the problem , it’s the one Blair solved and the on I cannot se brown solving

“One (bloody huge) problem with all that, Sunny, is that it would require an almighty display of humility from Brown. Fat chance.”

Indeed, when pressed regarding his claim that he had ended “boom and bust” his reponse was “I meant no more TORY boom and bust”. Does he not realise how ridiculous this makes him look? Why can’t he just be honest?

7) Woo Vince Cable as Chancellor; the man is pure political gold. He is a fantastic communicator and has the right ideas

Isn’t this already happening behind the scenes?

Indeed, when pressed regarding his claim that he had ended “boom and bust” his reponse was “I meant no more TORY boom and bust”. Does he not realise how ridiculous this makes him look? Why can’t he just be honest?

What about Cwhen he said ‘a weak currency is a sign of a weak economy, which is the sign of a weak government’.

Ooops

Labour won’t find any surrogates to fight their corner because (a) too many of them were in favour of the system that led to the mess (Comrade Digby, Irwin Stelzer) and the ones who weren’t are in favour of measures that govt. won’t pursue (e.g. Larry Eliiott, ‘Green New Deal’).

Challenging the Tories for their (lack of) ideas requires Labour to have a better analysis than ‘a big bank did it and ran away’. Sure, the Tories are vulnerable as a free-market party trying to respond to a crisis caused by the free market, but it’s not as though New Labour have a clear or coherent enough ideological alternative, despite all the frenetic activity to stave off a complete disaster. The other weakness is that it would actually require some ministers to think instead of parroting the latest agreed soundbite.

Vince Cable would say no – and besides, it would say volumes about the lack of available talent within the Labour party that Darling would be replaced by a LibDem. That said, if Vince was a bit more to the right and an ex-businessman, Brown would have snapped him up by now (see Comrade Digby).

Poor babies.

With the “cash for amendments” scandal we have now come full circle – New Labour is finished for a decade or more just as the Tories were in 1997.

15% behind…oh dearie me

My own narrative personal narrative opinion is narrative narrative narrative. Narrative? Narrative.

What do you actually suggest should be in the ‘rescue and recovery’ plan? I’m not seeing any real substance here apart from tactics.

I daresay the man needs a rescue and recovery plan first, and then he can worry about tactics.

we need some substance! politicos just talking amidst themselves and looking at Westminster – is NOT going to produce the substance.

this is where ‘politicos’ actually need to start thinking a bit more, quite a bit more.

Isn’t this a good reason as to why Vince Cable would not do it?

I think Vince Cable should put party politics behind him, at least for the time being, because this is a serious crisis that will affect our economic health for decades to come.

That’s asides from the fact that you’d be shoring up an administration that is illiberal and destroying civil liberties on a daily basis

There’s pros and cons here. Firstly, I don’t want the Tories to win with a big majority. If anyting, I’d like a hung parliament. Secondly, Tory economic policy would even more punitive on poor people since they’re likely to cut spending rather than try and boost it. And civil liberties are a big concern on mine but not the only one…

Claude:
British public know that the crisis is following 11 years of Labour governments so they will inevitably (and rightly so) link it to the Blair & Brown duo and their massive majorities.

The polls don’t bear out. Only about a third of the population directly blame Brown for the crisis, which was going to happen anyway.

Does he not realise how ridiculous this makes him look? Why can’t he just be honest?

I agree. Their response has been a sham.

redpesto:
Sure, the Tories are vulnerable as a free-market party trying to respond to a crisis caused by the free market, but it’s not as though New Labour have a clear or coherent enough ideological alternative, despite all the frenetic activity to stave off a complete disaster

agreed – I think their biggest problem has been the lack of a broader narrative about all this.

Dan – 😛

16. Alisdair Cameron

@ Sunny (15), “If anyting, I’d like a hung parliament” . I did mention that back in (2) as a better option than backing Brown, which he’d then take as a mandate for all of his parties’ ideas, many of which are repellent, or so ill-thought-through that the fall-out from unintended but serious consequences will be massive.
It’s just a shame you can’t really campaign for a hung parliament…

17. Shatterface

I’ll vote for a hung parliament too: no more mandates for the government. Let them have a tough fight for each and every decision they make.

18. Lee Griffin

“I think Vince Cable should put party politics behind him, at least for the time being, because this is a serious crisis that will affect our economic health for decades to come.”

That’s a very noble idea, however given that while the outcome is likely to be a slight move from the Tories to the Lib’s over economic issues, maybe some Labour too…Labour will mostly be shoring up their vote over good leadership. Why would the Lib Dem’s ever subscribe to something that potentially puts blocks in their way of gaining power? The mechanic is an important part of the racing team, but it’s ultimately the driver that lifts the trophy.

I also would like a hung parliament, to add to the chorus of approval for such a situation, but then that’s why I support FPTP policy direction and STV “partyless” representation (or as partyless as you can get in a country that has political parties 😉 ).

Sorry guys, but right now it looks as though your wish will not come true.

http://politicalbetting.com/index.php/archives/2009/01/26/icm-tory-share-jumps-6-to-44/

And when you talk of a hung parliament, whom do you wish to see as PM (the Queen has to ask someone to try to form a government even when there is no overall majority)?

Not Brown? Please, surely not Brown?

all this talk about “narratives”. maybe it would be better if people would vote against the Govt for its propensity to bang people up for long periods of time without trial, or for its devotion to sleaze, or for its contempt for parliamentary tradition. However, the major problems it perhaps faces are to do with the fact that it has lost credibility in some important areas.

First, it is intellectually bankrupt. Was it 6 months ago that David Cameron talked about a policy of paying employers to take on new employees. This was widely ridiculed in the press and in the blogosphere, amongst both the Worstall-libertarian axis and the party-hack Stumbling and Mumbling tendency. So when the Chancellor announces it as a recession-breaking policy, how do you expect us to react? And all this “narrative” about the Conservatives as a do-nothing party when their policies are the ones you steal…

And then, perhaps people have just noticed that Gordon loves to lie, tell untruths and act mendaciously whilst, at all times, being ruled by his moral compass. Northern Rock was a key factor in bringing on the collapse of UK banking. It was a UK institution, with UK depositors, with a UK loan-book, and UK bank loans – so how is that to be blamed on the “Global Crisis”?

No “narrative”, in particular one created by someone like Mandelson, can escape from these facts. It has taken the UK press a long time to wake up. Perhaps they are now smelling the coffee.

The Tories are going to benefit from a disaster that was caused by the very policies that the Tory party supports. I.e., deregulated financial markets, a belief in the freedom of bankers and rich business men to run things without oversight.

This is the Thatcher/Reagan dream in all it’s glory, and New Labour was stupid to sign up for it.

22. Alisdair Cameron

@ sally (20) “deregulated financial markets, a belief in the freedom of bankers and rich business men to run things without oversight…and New Labour was stupid to sign up for it”. New Labour didn’t just sign up, in the process selling a once noble party down the river, they were so bloody proud of signing up to the private is best/bow down to the City dogma that they had the bleeding signature tattooed across their heartless chests. The tattoos also function as a reminder of where their handy directorships and sinecures that will insulate them from the worst of the recession come from.

In these tough economic times surviving is most important, We all can win over this includes Democrats, Republicans, Big Business, the working class and the jobless. one can still win over this by following this pragmatic monetary policy.

LOL @ monetary policy, is all I can say. Anyone who advocates that now isn’t clued up on economics.

First, it is intellectually bankrupt. What, and the Tories have better ideas? At least the Labour govt gave up pretending it was fresh and new.

I’ll vote for a hung parliament too: no more mandates for the government. Let them have a tough fight for each and every decision they make.

Yup. But given the Tory majority right now, I think its strategically important to try and keep this race as close as possible.

25. Lee Griffin

“Sorry guys, but right now it looks as though your wish will not come true.”

These polls are all interesting but ultimately mean nothing until it’s coming down on election time. They are 15% up now, but one strong hit by Labour and it could be much closer, and at that time you could almost expect to see an election called. We have to assume that, unless Labour are well and truly done, that the polls closer to elections will be a lot less one sided.

You can make as many bullet-pointed suggestions as you like, but the inescapable fact is that the media and a lot of the public find it incredibly easy to dislike Brown.

Your suggestions are about tinkering with the message. The problem is with the guy in charge who the public ultimately see as delivering the message.

His poll bounce was a mere blip, now there are many recent polls showing a Tory resurgence. And you don’t need a poll to tell you he is disliked – ask any normal people down your pub what they think of him and they are likely to say he is a buffoon.

Part of the problem is that govts can’t really do much to alter the perception of a recession. Sure, they can stop banks going to the wall, which is undoubtedly correct. Yet the tinkering that Labour have been doing, the VAT cut, the cash injections – in spite of whatever benefits they bring (which is not many in the case of VAT), people only see the news regarding big names going bust. They only hear their friends talk about how they are worried for their job. They only hear about other companies making staff redundant. These people spent less at xmas. They are spending less now. They expect it to get worse. So when Brown’s face appears on TV wittering on about how he’s the best man for the job, that the Tories are the ‘do nothings’, that people shouldn’t be pessmistic, well a lot of people are starting to get really angry at Brown. Brown is the one figure in the UK associated with helping the recession get worse in this country; Goodwin and the other bankers are bit players compared to Brown’s claims in the last 10 years about ‘ending boom and bust’.

Instead of hoping to turn this situation around, you should be planning what to do when Labour lose. Not just in terms of who will replace him, as whoever it is, will not have much stature. But in terms of what the Labour Party stands for – this is what you should be discussing.

party-hack Stumbling and Mumbling

You realise that, as a statement, that’s up there with “pole-dancing bimbo Ann Widdicombe”?


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  1. Liberal Conspiracy

    New blog post: How Gordon Brown should deal with the financial crisis http://tinyurl.com/dg8qk5





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