Gordon Brown was Prime Minister of the UK from 2007 to 2010 having been Chancellor of the Exchequer from 1997 to 2007 under PM Tony Blair.
Very soon after his appointment he had to deal with the 2007 2008 global financial crisis and institute measures to deal with it.
Gordon Brown and his Chancellor , Alistair Darling, agreed on an emergency package of macro economic policies to deal with the crash. These included a cut in VAT, a substantial programme of public investment in school buildings and other projects. These measures were quickly successful and led to Britain’s economy growing 3.1% between the autumns of 2009 and 2010
However, the Labour Party lost the 2010 general election, the Conservatives having persuaded many voters that the crash had been the result of excessive public spending by Labour during their term in office.
One of Brown’s finest achievements was the chairmanship of the London G20 summit of 2009 where he persuaded the other Western nations to agree to a programme of expansion to deal with the effects of the crash, thereby preventing the world economy from falling into a severe recession The stimulus agreed at this conference had a significant effect. The prestigious US Brookings Institution has said that the London conference will be seen as “the most successful summit in history ” Brookings Institution “The April 2009 London G-20 Summit in Retrospect” 5.4.2010.
The Conservatives became the largest party in a hung parliament and joined forces with the Liberal party to form a coalition The new Chancellor George Osborne cancelled all the stimulus effects put in place by Brown and Darling and embarked upon the austerity experiment which is still with us today. The incipient growth in the economy was stopped in its tracks. – in the 6 quarters after after the Coalition took over it shrank by 0.4%. (David Blanchflower, New Statesman May 2012)
The policy of austerity damaged practically all aspects of public provision, increased poverty and inequality , caused the slowest recovery from a recession in history and the unhapiness and insecurity resulting was a significant cause behind the Brexit vote . Publicdid not reduce due to austeruty but increased.
Brown received plaudits at the time from Nobel Prize winner Paul Krugman in the New York Times . He said “Brown and Alistair Darling have defined the character of the worldwide rescue effort, with other wealthy nations playing catch-up.” NY Times 12.10.08
But it is strange that to this day , Brown has not received the credit he deserves (especially from the Labour Party) . The global international leadership he provided at the G20 in 2009 and the stimulus he devised with Darling for the UK were stunning successes.
Gordon Brown cannot avoid some censure for underestimating the risks of financial deregulation in the period before the GFC. No doubt a factor was that the government was enjoying unprecedented tax revenues from the successful financial sector. However he was not alone in this. All major western leaders were guilty of complacency over financial deregulation in this period.
Critics from the Conservative Party are guilty of hypocrisy given that the Tories published a paper in 2007 (pre Crash) , Freeing Britain to Compete‘ , seeking even more deregulation of the economy, especially the financial and banking sector.
Brown can be credited for getting it mostly right after the crash and showing leadership and statesmanship of the highest order when it mattered.
Aditya Charaborty in the The Guardian said
“Gordon Brown did not save the world but he saved the UK” Guardian 6.2.12
“None of this is to deny Brown’s own role in presiding over the boom that led to a bust. Or to forget his relative slowness to tumble to the seriousness of the crisis in the summer of 2008….It is simply to observe that when the moment of maximum danger came, Brown had the right diagnosis and did largely the right things. This is as close as contemporary, otherwise Lilliputian, politics comes to heroism.”
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