Analysis – the politics of recession
Outlook a little grey for Mr Brown
Wednesday, 10, Sep 2008 12:00
Gordon Brown has tied his colours to the mast of Britain's economy. Now the ship is going down, can the prime minister keep his head above water?
Today the European Commission followed up the Organisation for Economic Cooperation and Development in predicting the second half of 2008 would see two quarters of negative growth.
That, unfortunately, is the technical definition of recession. It's a bitter pill for any politician to swallow. But that is the unpleasant fate confronting Mr Brown in the next six months.
It's very bad circumstances for a Downing Street resident who faces a desperate fight for survival. His reputation for prudence, carefully cultivated throughout the 1990s and well into the noughties, painted an image of a man apparently impervious to the normal rules of economic cycles.
Was it really the end to boom and bust? Apparently so, consumers thought, as the debts piled up and the clouds gathered on the horizon.
It never rains but it pours for Mr Brown, who critics are saying is paying the price for his political hubris while chancellor. His was a magnificent achievement: the longest-serving chancellor kept his political enemies at bay by presiding over years of economic success. It was only once he had finally gained the top job that difficulties beset him. Badges of dithering and incompetence have led opposition parties to exultation and his supporters to despair. They have come just as the economy began its miserable downturn which will climax in negative growth by the third quarter.
Whether this is a coincidence depends on which side of the House of Commons you sit.
As expected following today's news, both the Conservatives and Liberal Democrats reacted with glee. Shadow chancellor George Osborne painted Mr Brown as being in denial, or worse, deliberately refusing to acknowledge the extent of the problem because it is his fault.
"He won't level with people about the state of economy, because he was the chancellor that left us so ill-prepared and put nothing aside for a rainy day," Mr Osborne said.
Not to be outdone, the Lib Dems' economic spokesman Vince Cable claimed Britain was "paying the price" for the prime minister's actions in his No 11 years, when he allowed the economy to get "hopelessly out of control".
"In these times the country needs real leadership but all we have seen from the government is panic," Mr Cable adds helpfully.
There was no outward sign of running for the lifeboats when Mr Brown faced reporters in a joint press conference with Silvio Berlusconi this afternoon. In fact the prime minister, when asked about the recession question, was more akin to the boy that stood on the burning deck.
Just as chancellor Alistair Darling repeated his "stability" mantra yesterday, today the prime minister focused his attention on the positives. The British economy is better prepared than it was in the 1980s and 1990s, he argued. Whether it comes to unemployment, inflation or national debt levels, he's right. But it was still uncomfortable to be in the audience.
"All European economies… are undergoing difficulties," he bleated. "We're doing everything we can."
Mr Brown's reference to government failures in the past contains a fundamental truth: politicians can't help but politicise economic success or failure. This is not the place to argue quite the extent to which economic fates are down to this government or that. It's enough to note that, for most of the last ten years, Labour was happy to contrast its own record with that of the Conservatives.
Now the tables are turned, the Tories and Lib Dems can't be blamed for jumping at the opportunity to turn economic woes into political advantage.
Alex Stevenson