Politics
The hostilities in the Labour Party are over, but now to avert a great depression
Published 09 October 2008
During the summer, as Labour remained fixed at more than 20 points behind the Conservatives in the opinion polls and as the plot to oust Gordon Brown gathered momentum, it was said that he could be saved only by a bomb, a terrorist outrage so extreme that it would force the Labour Party and the nation to unite behind its beleaguered Prime Minister. Well, Mr Brown has his bomb in the form of the worst economic crisis in living memory, and its aftershocks will be felt long into the future as a fundamental realignment of the relationship between state and markets takes place against the backdrop of a worldwide slump.
How is Labour responding to the crisis? It has to be said that good sense is at last breaking out in the party. On Monday, even before the government was compelled by events to part-nationalise the banking system with a £500bn bank rescue package, the rebel MP George Howarth, one of the public leaders of the campaign to topple Mr Brown, called on fellow MPs to unite behind the PM. The hostilities, he said, were over, as they must be at this time of national emergency. The government reshuffle, with the return to the cabinet of Peter Mandelson and Margaret Beckett, the promotion of the talented Ed Miliband, a potential leader of the party, and the retention of Alistair Darling as Chancellor, demonstrated that Mr Brown was prepared to be bold and imaginative; and that, as his critics have asked of him, he was prepared to transcend old enmities in the national interest, even if some were disturbed by the reappearance of Nick Brown, Mr Brown's favoured enforcer, as chief whip.
We were less surprised than most by Mr Mandelson's return to the cabinet as Business Secretary. After all, our political correspondent, James Macintyre, had been in conversation with him at the Labour party conference in Manchester and in the days that followed. In his exclusive interview with this magazine last week, Mr Mandelson had spoken of his support for Mr Brown while warning that the government must not move to the left, and that the party must not be "taken over by those who want to reject new Labour". Did Mr Brown read our interview, which was first published on our website on Wednesday morning, and then decide to appoint Mr Mandelson, as some have said? If so, we are happy to have been of assistance to him. Or did Mr Mandelson already know that he was destined to return to cabinet when he spoke to our political correspondent? Mr Mandelson is adamant that he did not know.
How distant seems the summer, when Mr Brown's No 10 began to resemble Macbeth's castle in Inverness, with its attendant unease, paranoia and fear. The plotters were febrile; the briefings - from those loyal to Mr Brown and from those acting against him - were insidious. By the time Mr Brown went on holiday to Suffolk in August there was a tragic dimension to his struggles.
In public, his face was strained and ashen as he answered questions with all the spontaneity of a speak-your-weight machine. Events reached a nadir when he went for a walk with his wife, Sarah, on the first day of their holiday, only to have his choice of jacket and shirt ridiculed. The intention was relentlessly to wound and humiliate him. You felt that some of his detractors would not have been satisfied until Mr Brown had been placed in the stocks on College Green and pelted, by all and sundry, with rotten eggs.
David Miliband made his move against the Prime Minister at the end of July, in the immediate aftermath of the Glasgow East by-election defeat, publishing an article in which he called on Labour to share his own "restlessness for change". After which, well, nothing much happened. No one moved definitively against Mr Brown. A dagger may have appeared before Mr Miliband but he could not bring himself to plunge it into the ailing Prime Minister. Mr Miliband longs for greatness, but the reality may be that he is "not without ambition, but without/The illness should attend it".
So the wheel has turned full circle and we are here: Mr Brown has been strengthened by his handling of the economic crisis, by a strong performance at the Manchester conference, by his bold (some would say reckless) reshuffle and by the callowness and slick exhibitionism of the Conservative front bench. One doubts that the hostilities in the party are, as Mr Howarth said, at an end. But for now, a welcome truce has been called. The pistols and daggers have been put away. Mr Mandelson is in the cabinet and the plotters coalescing around David Miliband have been thwarted, if not altogether silenced. And, for the first time in nearly a year, the Conservatives appear panicked and anxious, their inexperience exposed.
The scale of the £500bn rescue package for the banking system - a move described as "bold" by the former chancellor and Tory thinker Lord Lamont - is testament to the government's rediscovered sense of purpose. After the chaotic events of Tuesday, when the stock market was in free fall and the Prime Minister and the Chancellor were once more being accused of dithering, Mr Brown had to act decisively by seeking to recapitalise our main banks while attempting to limit the cost to the taxpayer. This was the right course of action.
We are entering a period of stagnation, if not full-scale recession. What must be averted is a great depression. These chaotic and unprecedented economic conditions may yet be the making of Mr Brown's premiership. He is back in the game; let's see how he plays.
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