Book reviews
Gordon Brown: My Life, our Times
A Book Review By Ray Riley
I approached the reading and my subsequent critique of Gordon Brown’s autobiography, ‘MY LIFE, OUR TIMES’, with predisposed cynicism, yes! But also, curiously intrigued regarding the historic role Gordon played in helping to stabilise the global economy during the 2008 financial crisis and the subsequent contagion which toxified the world of finance thereafter.
But each story has an origin. Following what seemed like Tory rule in perpetuity; graphically so well illustrated with the destruction of our once mighty manufacturing industry, the run-down of the NHS, the rise in child poverty, the increasing inequalities between rich and poor and the shackling of the trade union movement, the hopes and aspirations of millions rested upon the creation of a new force in society though a force nevertheless, devoid ultimately of a radical soul. A force, naively many believed that would sweep away the remnants of a bankrupt system where the unfettered market knew no restraints. The only thing required was to erase the word ‘socialism’ from the political lexicon; embrace neo-liberalism; be comfortable and at ease with the super-rich and encourage the marketisation of our public services.
Regrettably, the force I refer to is of course, ‘New Labour’. Yet the warning signs of New Labour’s ideological trajectory, which incidentally, is something that emerged immediately following Neil Kinnock’s blunt instrument approach to modernisation, is best encapsulated in Gordon’s 1995 speech ‘Dynamic Market Economy’, setting out Labour’s commitment to macroeconomic stability and financial prudence; the underpinning mantra of New Labour’s relationship with the finance sector. It would however be churlish of me not to acknowledge, notwithstanding, some of the progressive reforms enacted by New Labour. However, a critique of New Labour’s achievements juxtaposed with its failures is for another day.
To understand the two central players in this most Shakespearian of all tragedies: Tony Blair and Gordon Brown, Brown’s autobiography shines a light on the policy implications of New Labours intentions as early as 1995. However, the tectonic fault lines within New Labour however were inherent at its inception. The Brown versus Blair rivalry was to dominate the political landscape up to and possibly beyond Tony Blair’s ignominious fall from office in 2008. The autobiography does expose some of the differences and tensions between Blair and Brown, however nuanced they may be.
Yet with every autobiography there is the obligatory opening chapter dedicated to one’s upbringing. The son of a mainstream Scottish Church of Scotland minister from Kirkaldy in Fife, a towering figure in Gordon’s early years – who infused in his young son a Christian and moral sense of public duty. While sport was an early and particularly painful experience for Gordon (loss of an eye whilst playing rugby for Edinburgh University) it was apparent from this young age that he was especially, academically gifted conjoined with a steel-like will to succeed. With the smell of the Linoleum factory just up the road from where Gordon lived, it was inevitable that he was to cut his teeth as a young star In the Labour Party, rising through its ranks to become an intellectual giant and future Prime Minister. Gordon was not as the disgraced former Top Gear presenter, Jeremy Clarkson, called him a ‘one-eyed Scottish idiot’.
It is in this period of New Labour’s preparation for power that Gordon had set the groundwork for using public–private partnerships to rebuild Britain’s crumbling infrastructure, most significantly schools and hospitals. Astounding many people, one of Gordon’s first priorities in 1997 was to make the Bank of England independent, in effect handing over the country’s central bank to a cabal of unelected technocrats and mainstream economists. It is in this context that, despite Gordon’s claims to the contrary, New Labour embraced the pragmatism afforded to it by neo-liberalism. Moreover, and with Gordon at the helm - articulating the fundamentals of labour’s fiscal policy on public spending and borrowing. Simply put, a future Labour government would borrow only to invest and not for day-to-day spending, a position not too dissimilar in theory to John McDonnell’s current thinking on macroeconomic policy. But 1995 was, in many years, something of a seminal moment for New Labour and indeed for that matter the two individuals allied to Gordon who would rise to prominence in the years following: Ed Balls and Ed Miliband. They hammered out a series of major speeches with the underlying theme that a Labour government could deliver high levels of growth and lower levels of unemployment underpinned by Gordon’s ‘iron commitment to economic stability and financial prudence’.[1] The iron chancellor was born.
Setting out Labour’s future approach to economic regeneration, interestingly embracing John Major’s government’s predilection for Public Private Partnership (PPP) prescription for big project, economic regeneration; more commonly referred to as Private Finance Initiative (PFI). For its critics in the trade union and labour movement it was understood to be the half-way house to privatisation – ultimately resulting in extortionate interest rates payable over the next 30/50 years or more. Or, as Rodney Bickerstaffe was to comment on PFI that, New Labour had ‘built the bridge over which the Tories now march’.
For Gordon, however, PPP was different: they were simply tools at the disposal of government of mobilising private funds for public purposes and offered a better route to rebuilding the country’s infrastructure than the old ways of financing. Moreover, with PPP it was simply a way of mobilising private sector skills for public purposes and which secured better value for the taxpayer.[2] It is therefore somewhat disappointing to find that Gordon dedicates a mere 30 lines in an otherwise 500 page book to the controversy that PFI has become, apart from scant mention that if NHS Foundation hospitals went bust, it would fall upon the Treasury to bail them out or, as we see today, NHS Trusts throughout the country tendering out services to the likes of Richard Branson et al. While Gordon now obfuscates on this issue he cannot escape the charge so prophetically uttered by Bikerstaffe.
The high point of Gordon’s career and which forms the core narrative of his book and which has become a cause célèbre or even for that matter his entire raison d'être - is the role he played in the financial crisis in 2008 that mercilessly brought the entire world financial sector to near collapse. It is during this period of great economic instability that, Gordon, through the pages in his autobiography, becomes animated as he relives in quite some detail, not only the machinations and complexities of what had befallen us, but the rapid response required to mitigate the effects of a recession to a decade of slump. This period, perhaps the defining moment of his career above all else, gives one a fascinating insight into the chaotic world of international finance that Gordon interjected himself in to.
‘No one should panic’: with these words, the BBC’s business editor, Robert Peston, signed off his broadcast on the evening news of Thursday 13th September 2007, having broken the story to the world of the Bank of England rescue plan for the ailing, Newcastle-based Northern Rock.[3] The contagion from the collapse of Lehman brothers and the sub-prime mortgage sector had spread its toxic tentacles to the United Kingdom. HBOS too had fallen. It had staked everything on rising prices in the property market. In simple terms, HBOS’s Loan Book revealed an astonishing: 40 per cent of HBOS’s £432 billion loan book should never have been taken on.[4]
Put into perspective, Gordon had a conversation with one of the country’s leading bankers in 2008 who, unashamedly, admitted that he himself was only beginning to understand the risks that his bank was taking. Why then, according to Gordon, had we not spotted these problems earlier? And although in retrospect Gordon heard many players claiming that they had warned us against the impending ‘melt-down’, no one had presented Gordon or for that matter the international community with any concrete picture of the extent of the risks, nor of the shadow banking operations that operated at its fringes. Whilst the crisis exploded in the sub-prime markets of the United States the contagion spread to these shores.
Remarkably, Gordon believes to this day, and he has had ample opportunity to reflect on matters, that, even though regulation proved ultimately deficient, the tripartite framework of the Bank of England, Financial Services Authority and Executive was an appropriate early warning system even though the FSA had been in a turf war with the BOE – the frustration with Gordon against the FSA remains palpable to this day.[5] It was in fact, helping the global economies to avoid entering depression that defines Gordon. Other factors concerning his life pales in to insignificance compared to the energy and sense of duty he pours in to the incremental pages of the book in which the cautious Keynes in Gordon ensured that Britain was the first of the recession-hit countries to act in the autumn of 2008.
Alistair Darling, in an emergency budget in all but name, introduced a raft of measures: a small business finance scheme to support up to £1billion of bank lending; a £145 income tax cut to 22 million basic-rate taxpayers; a year-long VAT reduction from 17.5 per cent to 15 per cent; a £3 billion capital spending programme for transport, housing, the NHS and education and brought forward increases in the old-age pension, child benefit and child tax credits. Moreover, Labour introduced a car-scrappage scheme in response to the near collapse of automotive production in the UK – with sales falling by over 50 per cent between the start of 2008 and early 2009. The fate of some of our best-known car producers, even that of Rattan Tata’s Jaguar, appeared to be hanging in the balance. The scheme itself offered car owners a £2,000 incentive, half of it paid for by the government, to give up their vehicles and buy a new one. At a cost of £400 million it generated nearly 400,000 new purchases at a time when the auto market most needed assistance.[6] Much to the chagrin of US Republicans, President Obama too was to follow suit, through government intervention, in helping rescue the beleaguered American automotive industry (General Motors, Ford and Chrysler).
Gordon longed for the post-2008 crisis period to be as energetic a time for rebuilding and reform as the 1945 period – which produced the International Monetary Fund, World Bank, The Marshall Plan and the United Nations. Reform, prudence and not fiscal radicalism is the very body politic of Gordon Brown. Recession by the autumn of 2008 became clear to him that monetary policy by itself was insufficient to counter a radically deteriorating downturn and that by not acting quickly and in coordination would quickly lead to recession and even depression which history has shown us, cannot so easily be reversed without huge economic pain inflicted on those that can least afford it.[7] Given the enormity of the task, even as Lehman brothers in the USA, was disappearing into the abyss, the answer, as Keynesian teaching informed Gordon, was to increase public spending, reduce taxes, and run a government deficit- the purpose of which was to directly affect overall demand in a more interventionist way.
In his book Gordon concedes that whilst in government, Labour was up against the realities of neo-liberalism which, to remind the reader, is: to liberalise, to privatise, and deregulate with concomitant levels of high unemployment at the price of keeping inflation down so that the radius of market influence expanded into: education and healthcare. And whilst Gordon himself, less so Tony Blair, did express reservations against market incursions, in its unbridled form, this state-shrinking paradigm, tax-cutting free market fundamentalism meant, for many people, the pain of being jobless, in poverty and with whole communities being abandoned to their fates. Gordon recognised this shift, agreeing still that the markets may be a good servant but, in his view, conceding they are not such a good master.
The millstone wrapped around Labour’s neck that it was too profligate in its spending, fundamentally has never been challenged, even, dare I say, by a Corbyn led opposition. The Tory myth of Labour’s profligacy continues, largely unchallenged. It was precisely this retreat within Labour’s ranks that the Tories have successfully been able to own the narrative. Gordon himself refers to it rather more succinctly.
As the historian, Robert Skidelsky has observed, the Conservatives constructed a commensurate political narrative that linked folklore economics (the government can’t spend money it hasn’t got) to the politics of blame (cleaning up the mess left by labour) to the politics of fear (The Greek Bogeyman) to grand economic strategy (reducing the deficit is necessary condition for sustained recovery). It was in fact a bogus claim – proven right by 8 years of Tory rule.[8]
Even with the election of Jeremy Corbyn as Labour leader, Iraq continues to cast a dark shadow over the Party, a shadow that was to darken even further as the Chilcot Report concluded when delivering its damning verdict on the decision by Blair and the UK Parliament to commit British troops to the US-led invasion of Iraq. Events bore witness to a conflagration of the middle east, particularly Iraq and Syria, which has been witness to over a million deathsbased on the false and mendacious premise that Saddam did have Weapons of Mass Destruction (WMD).
Iraq was and still remains, Labour’s elephant in the room, when, 13 years later, at the Chilcot inquiry Gordon was to say that, ‘you cannot fight a just war unless you have grounds to believe you can create a just peace.’
Whilst Gordon has maintained clear intentions regarding 9/11 and the military invasion of Afghanistan he does, however, now concede the question: why Iraq in 2003? But it must also be, as far as Iraq is concerned, disingenuous of Gordon to infer that Chancellors have seldom been at the center of decision making in matters of peace and war,. He uses David Lloyd George, as the example of one who had to change to Minister of Munitions in order to play a lead role in Britain’s war effort, as the historical precedent. Bowing to deference or precedent, Gordon suggests that his role was one of finding and/or allocating, bankrolling funding to wage war, that in essence remains an illegal war.
Following his near cathartic moment following Chilcot, Gordon now asks himself in the pages of his book whether he could have made a difference before that fateful decision was taken. Robin Cook’s honourable resignation during the tumultuous Parliamentary debate in 2003 springs to mind.
Belatedly, Gordon now accepts that the US was not forthcoming with the truth about WMD – but remains somewhat paralysed in his denial as to the role he played, even though during the build up to war he himself uttered reservations about the impending firestorm that would engulf the middle east.
In light of what we now know about the absence of WMD [9] it was based upon the false premise that Saddam possessed such weapons. However, unlike Blair, who to this day remains resolute in his schizophrenic defence of the catastrophic decision that, not only witnessed the loss of a million lives, but the creation of a political vacuum created by the firestorm which followed; spawning in its wake the birth of Frankenstein’s monster, ISIL. And whilst Gordon does now question his fateful decision; pointing at the machinations, mendacity, sophistry and hubris of the neo-cons: Cheney, Wolfowitz, Rumsfeld etc and the puppet presidency of George W Bush – that Gordon was, not only misinformed – but misled[10] But this acceptance, is tempered as he continues to hold on to the remaining semblance of moral rectitude by claiming that when we left Iraq in 2009, it was still one country; qualified later with Gordon now recognising the country is split on sectarian lines.
In reality, these sectarian divisions still haunt the country and where the daily deaths now go unreported by the British media. No, from the launching of the first cruise missile to the grotesque visions of ‘Shock and Awe’, Gordon knew the reality and went along with it. He, along with the rest of Blair’s cabinet and MPs cannot now extricate himself from the fateful narrative that is Iraq.
Subsumed or not by the false premise that Saddam possessed such capability I am reminded of the famous words of Martin Luther King Jr, “There comes a time when one must take a position that is neither safe, nor politic, nor popular, but he must take it because conscience tells him it is right.”[11]
Unlike Blair, who continues to travel the international ‘gravy-train’ touting for personal gratification from whichever despotic regimes are prepared to heed his septic advice to the swelling of his over-abundant bank balance, Gordon chose a different path, one that would see throwing himself into worldly causes with his work for Save The Children, becoming UN envoy for global education and the support he and his wife, Sarah, have given to their very personal relationship to cystic fibrosis. Yet in the process, Gordon was to fall foul of the Murdoch empire who, to this day, continue both to pillory and malign his legacy. The cosying up to the likes of Rupert Murdoch and Rebekah Brooks could only end in one way. ‘If you lie down with dogs you will catch fleas’.
But in the here and now Gordon proselytises that we need not be swayed by purely sectional interests. We can be the party that stands for fiscal realism and not just more spending, irrespective of whether it delivers better outcomes.[12] This point in question has similarities with the shadow Chancellor’s thinking. John McDonnell, appears to have conceded some of Gordon’s rhetoric and banality economics, apart from McDonnell’s disdain for PPP initiatives - that remains such a mill-stone around Labour’s neck.
Is Gordon, ideologically wedded still to New Labour or pragmatically a man of the moment who can accept, if not embrace, the Jeremy Corbyn phenomenon? The election manifesto of 2017 was under-ambitious and the left in the Party is still reluctant to hammer home its advantage by de-selecting sitting Blairite MPs, for fear of upsetting the delicate and rather nebulous balancing act of a coalition of right and left within the Parliamentary Party that glues the whole thing together. In this context, Gordon continues to evangelise about us (Labour) in never reverting to the politics of the 1940s and ‘70s or even those after 1997. The test now according to Gordon[13] is to lead, not through attempts to re-live these years but in a world where the actions he advocated in helping to salvage a world from the brink of financial collapse in 2008/09 (his cause celebre), To Gordon’s economic orthodoxy it did in part stave off a much anticipated depression through conventional Keynesian measures. Or was it simply measures to kick-the-can down the road until the next, even deeper economic crisis? Or is it simply Gordon’s now periodic interjections regarding his unfinished business following the 2010 election defeat? On this point, even the most ardent of critics, must now recognise the value of his interventions during this turbulent period. On this, I believe history will be a little kinder to him.
Gordon’s ideological position is best seen through the prism of state interventionism and laissez faire. He is not a socialist in the sense of the current Labour Party leader, Jeremy Corbyn. On the contrary Gordon in his autobiography is resplendent in his admiration of the captains of business and industry: Alan Sugar, Digby Jones, David Sainsbury (members of the House of Lords) and even of his foreign friends, in particular the highly controversial figure of Benjamin Netanyahu. Any reference in his book to the trade union movement or mention of the word ‘socialism’ is conspicuous by its absence. It is not surprising, given that Gordon has no ideological attachment to socialism, nor is there any analytical mention of the rise of Corbyn, though recent comments have tempered his silence by saying that Jeremy connects with people more than he, Gordon, could ever do.
He reminds one thus of a an ‘old-school’ conservative who tolerates a modicum of public ownership in the sense of the ‘one-nation’ approach to politics - harking back to the consensual days of Rab Butler and Hugh Gaitskell (Butskellism) – a coalition of convergence where both morality and civic duty informs the need to do something about the poor juxtaposed with the necessities of financial prudence and capitalist accumulation. Yet if history teaches us anything it is that under capitalism these tensions remain in irreconcilable conflict. Driven therefore by this sense of moral servitude, Gordon Brown remains a fascinating figure who will be debated and studied for many years to come – along with all of his personal imperfections, successes, complexities, intellectual prowess and acumen and the all too impatient imperative in his life, his moral sense of duty.
Gordon, outside of the pages of his book, now concedes (as referred to above) that Jeremy Corbyn’s popularity and support arose out of the disillusionment of people - so tired of a system that Gordon, although critical of, remains religiously wedded to.
A much maligned and somewhat marmite figure, Gordon, however, remains a complex and controversial figure; detested by the right, confusing to sections of the left – but clearly someone who demands both our attention and not simply remembered for his foolish comments about Mrs Duffy’s alleged bigotry during the 2010 election campaign.
Understanding of the economic and political role Gordon played both within New Labour and now outside of it is essential study for the student(s) of Marx and Keynes visa-a-vi his legacy of state and global intervention during the 2008/09 financial crisis. Anything other would be a serious error and misinterpretation of the events that beset the world – the outcome of which was to usher in a decade or so of crippling austerity.
References:
- Gordon Brown, My Life, Our Times, Bodley Head, Penguin, 2017, p.104
- Ibid. p.135
- Ibid. p. 295
- Ibid. p. 309
- Ibid. p. 121
- Ibid. p. 347
- Ibid. p. 339
- Ibid. p. 356
- Ibid. p. 250
- Ibid. p. 265
- A Testament of Hope: The Essential Writings and Speeches, Martin Luther King Jr.
- Gordon Brown, My Life, Our Times, Bodley Head, Penguin, 2017, p. 456
Mike Phipps reviews Utopia for Realists, by Rutger Bregman (Bloomsbury, £16.99)
THE SEARCH FOR UTOPIAS can be dangerous, but not searching is also fraught. The idea that modern capitalism is about the best we can do is, as Ralph Miliband once said, a slur on humanity.
But this delusion persists, even after the the Great Crash of 2007. For the elites, politics remains about problem management - only symptoms are addressed. The dominant ideology, liberalism, has been hollowed out and reduced to the freedom to consume. The dominant ideas are ones that validate capitalism.
Yet Rutger Bregman has some arresting facts. “For every pound earned by advertising executives, they destroy £7 in the form of stress, over-consumption, pollution and debt; conversely, each pound paid to a trash collector creates an equivalent of £12 in terms of health and sustainability.”
People are well aware when they are doing meaningless work. A 2014 YouGov poll found that 37% of British workers felt they were doing a job that didn’t need to exist. Strikes emphasise this. A stoppage by New York garbage workers led to an immediate environmental health emergency, which would not happen if overpaid lobbyists and bankers struck.
The case for higher taxes - not just on the rich because they can afford it, but to get more people into useful work - is clear. Bregman’s aim is to make utopian ideas look reasonable. His big idea - popularised in a TED (Technology, Entertainment, Design) talk in April 2017 with well over a million online viewings - is to give free money to people. A universal basic income would be cheaper to operate than the cost of dealing with homelessness or policing the benefits system, and would actually make people more productive.
This idea is not new. US policymakers took it seriously in the 1970s, impressed with evidence about improved health and educational outcomes. It was abandoned when opponents highlighted spiralling divorce rates in areas where such schemes had been trialled. With the rise of the Christian right, a policy that gave too much independence to women was unthinkable.
Since then, the focus on “helping the poor” has been spectacularly unsuccessful, not least because it deepens the wedge between them and the rest of society. Universal approaches work better and increase social solidarity. That requires proper funding of public services. But countries with a large public sector, as in Scandinavia, also score high on wellbeing indicators - as do countries with less inequality. States with the highest rates of depression, school dropout, drug abuse, obesity, low electoral turnout, social and political distrust are also the most unequal.
High on this list is the US, not a poor country in world terms. But inequality has social consequences, for example more bullying, that contribute to stress and poor health. The IMF says that inequality even limits economic growth.
Yet even as production grows, median wages are declining significantly, as labour is less scarce, partly due to increased mechanisation. Scholars estimate that nearly half of all US and a third of European jobs are at high risk of being usurped by machines in the next 20 years.
Hence another of Bregman’s ‘utopian’ ideas: a drastic shortening of the working week and expansion of leisure time. Evidence suggests a shorter work-week need not hit productivity - rested workers are more efficient. Even Ted Heath’s notorious three day week during the 1974 miners strike caused a fall in production of only 6%. Less work means less stress, less unemployment, less climate change, fewer accidents, more gender and social equality.
Globally, Bregman identifies one single measure that could eliminate poverty: open borders. In an era of globalisation, only 3% of people live outside the country of their birth. Billions of people are forced to sell their labour at a fraction of what they could get in a developed country, a key driver of global inequality. Opening borders would generate an estimated $65 trillion in wealth.
This sounds truly utopian. But most concerns that have been raised against it don’t withstand scrutiny. There’s little evidence that open borders increase criminality or depress wage rates. Even the idea that diversity undermines social cohesion has been debunked - it’s the disadvantages that people in diverse communities face that undermines trust. And open borders mean that migrants, knowing they are free to come and go, are more likely to return to their country of origin. Instead, the opposite is happening: “three quarters of all border walls and fences were erected after the year 2000.”
This book is accessible and optimistic. Bregman has said in interview that Martin Luther King didn’t gain support by saying, “I have a nightmare.” The left needs to reclaim the language of hope and progress. Jeremy Corbyn understands this. The gap between utopia and power is closing fast.