11 Sep 2011 04:35:55
Alistair Darling did neither. He presided over the longest and deepest recession in Britain since the second world war, including the biggest one-year drop in activity since the early 1920s. And, having been dealt one of the duffest hands imaginable, he survived the run on Northern Rock, the enforced nationalisation of a good chunk of Britain's high-street banking network and incessant bad-mouthing, to be there when Brown departed from Downing Street five days after the 2010 general election.
Even so, Darling is a rarity in British politics; a chancellor whose reputation has improved with age. In part, that is due to his baleful legacy, a structurally weak economy that would be gripped by a systemic financial crisis within six weeks of him taking occupancy of 11 Downing Street. In part, it is that Brown has become the scapegoat for all the failings of the Labour government. But it also has something to do with the fact that Darling comes across as a thoroughly decent bloke doing his best in the worst of circumstances.
Unsurprisingly, that image is burnished in this memoir of Labour's Götterdämmerung, which is peppered with tales of the chancellor's best endeavours being thwarted by a paranoiac prime minister, an out-of-touch Bank of England governor and the antics of bankers intoxicated by money and power.
From the start, Darling suggests, he was only keeping the Treasury seat warm for Brown's protégé, Ed Balls, and had to put up with incessant meddling from his next-door neighbour as he prepared his budget statements. With some relish, Darling tells the story of his Guardian interview in the summer of 2008 which, entirely correctly, warned that the global economy was at risk of its most severe downturn in 60 years, but prompted behind-the-scenes attacks from Brown's camp.
"My fairly accurate prediction of what was to come economically might have been long forgotten but for the inept briefing machine at No 10", Darling notes. "For that I owe them thanks, which is something I am sure they never anticipated."
The sub-plot detailing Darling's strained relationship with Sir Mervyn King also makes compelling reading. It is clear from the book that the two fell out badly over the way to handle the credit crunch, with Darling becoming increasingly frustrated by what he saw as the governor's foot-dragging approach to providing financial support for the banking system. When King's first five-year term of office was drawing to an end, Darling only reappointed him because he could think of nobody better to do the job, hardly the most ringing of endorsements. A year later, King used his Mansion House speech to call for the break-up of Britain's banks into investment and retail arms, and for the job of policing the City to be handed to the Bank of England. Darling says that both were Conservative party policies, and that King's earlier warning that the Brown government had not set out a credible plan for public borrowing could be similarly characterised. "Mervyn was careful to cover his pronouncements with caveats, which usually went unreported, but even so he was coming perilously close to crossing a line between legitimate comment and entering the political fray."
It would be wrong though to see this book simply as a crude attempt to settle scores, however tempting that must have been. Instead, Darling sticks the stiletto into his victims with great deftness. His criticisms of Brown and King carry more weight because they are leavened with praise where he thinks it is due. During the period after the collapse of Lehman Brothers in September 2008, Darling says it was Brown's force of personality and determination that ensured all the major countries signed up to bailing out the banks. Similarly, King did an "excellent job" in the build-up to the London G20 in April 2009, making sure other central bankers knew what they had to do to boost growth. The overall impression is of a chronicler at pains to be both fair and accurate.
Given Darling's reputation as a safe pair of hands, it is strange to find so many factual mistakes. The Doha round of trade talks began in 2001 not 2002. Alastair Campbell did not leave the Blair government in 2002; to have done so would have meant him quitting before the start of the Gulf war in 2003. The economy contracted by 4.9% in 2009, not 4.7%. The date when the Royal Bank of Scotland was on the brink of collapse shifts from October 7 2008 (correct) on page one to October 11 (incorrect) on page 12. Unless Darling is using a special Treasury arithmetic where each unit counts double, it is 6,000 miles from London to Cape Town, not 12,000.
These are silly errors which detract from what is otherwise a thoroughly readable, and often witty, account of what Darling calls his 1,000 days at Number 11. The inability to get the small things right inevitably creates doubt about whether the author is wrong about the big things as well, and it would be a mistake to see this account – however reasonable it seems – as the last word on Labour's dog days. The current slide of the economy towards double-dip recession suggests that Brown and Balls were right about the risks of switching from stimulus to austerity too soon. King's view that failure to get tough with the City makes a second financial crisis more likely may yet be vindicated. Darling rather glosses over his responsibility for the flawed system of City regulation that broke down completely during the financial crisis and never really satisfactorily explains why he didn't tell Brown, seriously weakened after the "election that never was" in the autumn of 2007, to get his tanks off the Treasury's lawn. Darling bottled up his resentment at the deplorable way he was treated and is now having his revenge in print. That makes Back from the Brink one heck of a good read.
