For well over a year, I’d been planning to write a blog post on Gordon Brown: his time as Chancellor and PM and his legacy. And then, about three weeks ago, Polly Toynbee, prompted by the publication of Brown’s autobiography, writes a piece for the Guardian along practically identical lines to what I’d planned. Serves me right.

So, in the light of last week’s budget, I’m writing a slightly different piece, comparing Brown to his successor-but-one, Gideon George Osborne. Two very different personalities with very different legacies. It’s a case of chancellor v chancer.

Personalities

Gordon Brown always comes across as a product of his modest but comfortable Scottish Presbyterian upbringing. Instinctively frugal, with a concern for the betterment of the lives of his fellow human beings, I feel he developed a strong ethical code to guide his life. Brown was brought up to be straightforward, to tell the truth and always do the right thing. He appears naturally shy and reports by those who know him say he comes across as a much warmer person in private than his public persona. Not obviously gregarious, he was suspicious of the motives of his closest colleagues, which increased during his time as PM almost to the level of paranoia.

George Osborne, by contrast, is a whole different kettle of fish. Polished and self-confident, he carries a powerful air of entitlement common to those who were educated at a posh school: St Paul’s in his case. He carried with him into Parliament an absolute conviction that he was born to be part of the ruling class. Isolated from any but the most privileged, he has never shown any interest in the needs and concerns of all but the richest and most privileged. By happy coincidence, these are the people who fund the Tory party. Along with Boris Johnson, Osborne above all shows the most utter contempt for the truth: any lie will do as long as it serves his own purpose. Perhaps the two most egregious are these: firstly that Labour were responsible for the global financial crisis of 2007-8 and secondly, by conflating fraud and administrative error, gave a totally misleading impression of the level of benefit fraud. (The much-bandied misleading figure was £5 billion, only 20% of which is fraud, some 0.7% of the total benefits bill.)

Rabbits and Hats

Different though their personalities are, both Brown and Osborne share one thing in common. Both could not resist the temptation, on Budget day, of making the Budget speech into a theatrical event. Both would spring the odd eye-catching announcement, like a rabbit from a hat, intended for maximum political effect, even when the economics was dubious. And both carried great political weight and authority within their respective Cabinets.

Another thing in common is that both Georges are history graduates: Brown with a first-class MA and a PhD from Edinburgh and Osborne a 2:1 from Oxford. (Although Osborne’s degree was in modern history, I can’t help imagining that his favourite read was The Prince by Niccolo Machiavelli.)

The similarities end here. So what is my verdict on their performances as Chancellor of the Exchequer and on their subsequent  legacies?

The Chancellor

For Brown, I distinguish his time as Chancellor between pre- and post-financial crisis, the latter including his time as Prime Minister. In summary, my overall verdict for the first phase is “mixed”. For the second phase, I believe that Brown was the most authoritative and respected financial leader in the western world.

The first period included policies which I would count against Brown. Together with Tony Blair, he accepted the basic tenets of Thatcher-Reaganite Free Market Fundamentalism and only watered them down a bit. Direct taxes were lowered somewhat and no serious attempts were made to rebalance the UK’s lopsided economy away from over-reliance on services and financial services in particular. Worse still, Brown expanded the use of Private Finance Initiatives (PFI) as a means of financing many public sector capital projects, to keep down public sector debt. This has left a toxic legacy, most notably in the NHS.

On the other hand, much good was done during Brown’s tenure. Child poverty was drastically reduced from the Thatcher / Major legacy: the proportion of children living in poverty fell by a third. The introduction of Child and Working Tax Credits was a major factor in this. The Institute for Fiscal Studies, Britain’s most respected independent economic think-tank, also notes the drop in pensioner poverty. The IFS too, whilst noting that inequality rose under New Labour, “there is evidence to suggest that these reforms prevented a larger rise in inequality than actually occurred under Labour.” Several other non-fiscal policies funded by Brown’s Treasury, notably Sure Start centres introduced more strategic reforms to bring about long-term improvements to the life chances for children from poorer households. So, overall in the period 1997-2007, the good probably exceeded the bad, but not by much.

That balance changes after the global crash. Whilst Toynbee’s claim that Brown “saved the world” over-dramatizes it a bit, Brown was a key player in stabilising the financial system after 2007. His decisive action immediately after the crash and a package of pro-growth measures turned recession to modest growth. In 2009, he pushed hard for the introduction of the so-called “Tobin Tax”, a very low levy on all financial transactions and named after the economist who first proposed it. The tax is designed to reduce the riskier behaviour of the finance services industry, whose recklessness caused the 2007-8 crash, which started in the USA. Brown seems to have been the first world leader to grasp that things must change. He also was clear that, in order to succeed, reforms needed to be coordinated across a critical mass of the world’s economies. Any one country going it alone could easily be picked off by rogue “beggar my neighbour” states.

In 2009-10, globally Brown seemed to have grown in stature on the world stage as a key influencer of change to the economic order. Tragically, his standing at home was in rapid decline, by a combination of his personality, concerted attacks by the Tory opposition and their more rabid running mates in the press and the accusations of cowardice for not calling a snap election. (Strange how snap elections, or the lack of them, can swing political fortunes in a trice!) His increasing troubles domestically reduced his standing abroad and the opportunity for lasting, international reform was lost. If Brown had somehow managed to win an election in 2009 or 2010, things may look very different today, but the scent of decay and decline for the New Labour project was in the air.

The Chancer

Enter, alas, George Osborne. He lost no time about implementing a new order of austerity. First, Labour’s legacy was trashed. There was the lie, already mentioned, about Labour causing the crash. To make matters worse, who remembers now that shadow Chancellor Osborne promised in September 2007 to match Labour’s spending plans. This was a cynical political move to try to detoxify the Tory brand as the “Nasty Party”. So the lie was, in effect: “It’s all Labour’s fault, but we would have done the same”. Secondly, a coordinated propaganda campaign was remarkable successful in persuading public opinion that it was now all the fault of benefit scroungers: the new “straw man” to deflect blame from his friends – and Tory donors – to the poor. It also provided convenient cover for the long-term FMF project of dismantling as much of the state as possible, for zealous ideological reasons. Reducing the public sector deficit became a total obsession, to the exclusion of other economic objectives.

The effect was to kill the (albeit weak) growth induced by Brown’s and Alistair Darling’s careful nurturing of the post-crash economy. It wasn’t helped by Osborne’s ridiculous and reckless assertion that the UK economy was weaker than Greece’s, which was patently untrue. This helped to flatten business confidence overnight. Actions have consequences, George.

For balance, I’ve tried hard to think of a policy change introduced by Osborne of which I approve. I’ve searched the web to remind me but, sadly, I can’t find anything. Let’s just say Osborne was one of the best of Cameron’s cabinet in modernising the Tories’ position on social policy: for example, he was one of the strongest Tory supporters of same-sex marriage. But on the economy (his day job), no.

Taking spending power from the poorest in society is a good way to reduce demand and shrink the overall economy, as the poor spend a higher proportion of their income. (The rich tuck their spare cash away in safe tax havens.) This, in turn, reduces tax takings and pushes up the government deficit. What’s worse, with lack of growth in the economy, debt as a proportion of GDP is higher than it would be. Osborne famously predicted in 2010 he’d eliminate the deficit in 5 years: he failed spectacularly. We’ll be lucky if we achieve that objective by 2030 on present policies.

Of all Osborne’s budgets, the 2012 “omnishambles” was arguably the worst. He gave us a cut in the top rate of income tax for the highest earners and the failed attempt to introduce the “pasty tax”. Greggs had a field day as politicians fell over each other to be photographed eating a pasty. Not his finest hour!

Legacies and Might-Have-Beens

So, what can we thank these two contrasting characters for, by way of legacy? For Brown, his reforms made significant progress in reducing child poverty (tax credits, Sure Start centres and the rest). But he left vast areas of the public sector saddled with repayments to private sector companies making vast profits from Private Finance Initiative schemes, which Brown expanded significantly.  Most importantly, he was quick to improvise policy in unprecedented times of crisis in 2007-8. Whilst painful for the economy, his decisive action saved the UK from a potentially far, far worse fate: a 1930s-style Great Depression.

And as for Osborne? He gave us austerity: a dogma-driven, economically illiterate policy for which he lied that there was no alternative. As well as being morally wrong, it simply doesn’t work. Most economists now accept that this is the case, and some came to this conclusion sooner than others. Here’s a US analysis from four years ago pointing out the failure of austerity. Even now, Chancellor Philip Hammond has left policy largely unchanged, his recent budget just tinkering around the edges. And, of course, austerity has already undone much of the good work on reducing poverty, remorselessly back on the rise.

So the poignant “what might have been” is if Gordon Brown had had more time to lead western opinion to move away from Free Market Fundamentalism, in concert with other nations. This would also have started a measured move for thee UK away from over-reliance on financial services towards a healthier, more balanced economy. We could have had less inequality, less poverty, no EU referendum, no unnecessary trashing of the economy to come after 2019.  We’ll never know.

Did you spot the milestone that the country reached last Friday? I didn’t at the time. If you don’t know what I’m referring to, here’s a clue:

It’s the time of year when people buy advent calendars. This year, perhaps, the squares on the calendars should be re-numbered, starting with 483 and ending with 459.

Still don’t know? Read on…

Anguish of 1000 Days

Or 1009, to be exact. There are 1009 days between 23 June 2016, the date of the EU referendum, and 29 March 2019, the date the UK leaves the EU on current government plans. Friday 10^th November 2017 was the first date when more days have elapsed (505) since the referendum than days left (504) until the leaving date. So, how is the UK Government managing the process? It’s time for a Half-Term Report.

In summary, I’d put it like this: achievement: none, progress: extremely poor. Let’s examine these areas in more detail.

On Day 20, Theresa May was appointed Prime Minister – Labour took another 73 days to re-confirm Jeremy Corbyn as leader, following a leadership challenge started in early 2016. May appointed her triumvirate of relevant Ministers: Davies, Fox and Johnson immediately afterwards. Leaving aside the fact that none of these three was remotely suited or capable of carrying out their appointed role, for May, at this stage, it looked so far, so good.

But there followed a period of dithering and bickering within the Tory Party about when to trigger Article 50, which started the 2-year countdown for completing negotiations. It was obvious nobody knew what to do, the relevant departments were unprepared and no plans existed to articulate the UK’s negotiating position. Eventually, after mounting pressure from the rabid Leave wing of the party, Article 50 was triggered on 30 March this year: 280 days after the referendum. Clock ticking, 729 days to go.

Minority Report

After denying seven times since appointment as PM that she would call a snap election, on Day 279, May called a snap election. As is well known, her campaign was a disaster and the result of the election on Day 330 was a hung parliament. Her Parliamentary majority and 51 days lost. Two further days were lost before May, after misleading the Queen – who was “not amused” – found a sufficiently large bribe (£1 billion) to get the DUP to support key Commons votes. The Government was now in hock to what has been described as “the political wing of the 17^th century”. Not good for the Northern Ireland Peace Process or the suspended Stormont devolved government, but, hey, who cares when it’s the future of the Tory Party at stake.

Groundhog Days

Six rounds of negotiations have been held since then. The EU had held an early meeting with the European Council and Michel Barnier, their chief negotiator, spelled out the timetable and the famous “sequencing” demands. This stated clearly that “sufficient progress” on three topics important to the EU27 (divorce bill, citizens’ rights, Irish border) would need to be made before talks could start on a new trade relationship. Weeks were lost when Davies (with noises off from other “rabids”) blustered and resisted, before giving in and agreeing to all these demands on the first day formal negotiations began.

At the end of each round, Barnier has stated that the UK hasn’t given sufficient clarity on each of the issues, whilst Davies made repeated vague comments about progress and “flexibility”. 19^th October – Day 463 – was the deadline when the UK was hoping the EU27 would agree that sufficient progress had been made. It was obvious talks were all but stalled. May’s speech in Florence on Day 435 made some conciliatory-sounding general declarations but was empty of any useful detail. The speech was given a cautious but reasonably warm reception by “the other side”. However Davies and his team failed to clarify any of the three key areas in the period since then. It’s obvious why not: May hasn’t the authority within her minority Government to thrash out an agreed position. The UK still can’t agree what it wants. The deadline was missed and it’s pushed back to some time in December – round about Day 540. Don’t hold your breath.

As part of the farce, Davies had stated there were reports on 58 industry sectors about the impact of leaving the EU. On Day 473, the government refused a Freedom of Information request from a Labour MP to publish these to Parliament. The government then caved in two days later, following a threatened revolt and potential lost vote in the Commons, but said it needed time as there weren’t 58 reports – 58 backs of fag packets perhaps?

Day 508

So, here we are, on Day 508. Nothing of note achieved in Round One of the negotiations in the 228 days since the triggering of Article 50. The screams of anguish and frustration from the leaders of many industry sectors, the CBI, Chambers of Commerce, etc. are growing louder. Contingency plans for a post no-deal “cliff edge” scenario are being drawn up all over the place – including the EU27.

As a further sideshow, on Day 496 and Day 502, two Cabinet ministers were forced to resign with a weakened May making the minimum reshuffles necessary to stop the whole house of cards from toppling over. Still, 501 days to go: there’s only nearly all of Round One (key EU issues) and the whole of Round Two (trade) to sort out.

Meanwhile, Some Good News

One short article in today’s paper caught my eye. A German charitable trust has donated €1 million towards the cost of refurbishing the world’s oldest cast-iron bridge at Ironbridge in Staffordshire. The trust’s chairman said: “Not only do we admire the Iron Bridge as an important technical landmark, but we also see it as a potent reminder of our continent’s common cultural roots and values … In the current climate it seems more important than ever to raise awareness of the links in our industrial heritage and our broader cultural bonds.”

Aah… “Our continent’s common cultural roots and values” and “broader cultural bonds”. They’re two of the reasons I voted Remain. Didn’t hear them mentioned once during the referendum campaign.

One of the key – and undoubtedly most persuasive – points made by those advocating leaving the EU in last year’s referendum campaign was “take back control”. Always illusory in an interdependent world, I want to explore its validity in the context of a future vote in the House of Commons at the end of the 2-year negotiation period. I’ll end up arguing that Parliament compromised its sovereignty when it agreed to hold the referendum in the first place!

It has been an essential part of our unwritten constitution for over 300 years that parliament is sovereign. This was the point argued by Labour (and a few constitutionally-minded Tories) forcing a concession from the Government for a Commons vote before the Article 50 deadline in March 2019. It feels that this concession was dragged out of Theresa May only on account of the extreme weakness of her position. And as so far reported, May offered only that Parliament will be invited either to accept the agreed deal (if any) or crash out of the EU and trade on WTO terms.

2-Way or 3-Way?

May’s offer, clearly, gives MPs a 2-way choice: deal or no deal. For Parliament to be truly sovereign, reason demands a third option: withdraw from the Article 50 procedure and remain in the EU on current terms. The lawyer who helped draft Article 50 says it’s reversible; others have disagreed. The rabid, irreconcilable Leavers (who have made all the running so far) would argue this third option is politically impossible as it would be denying “the will of the people”. But remember the vote was 37% leave, 34% remain, 29% no vote. So, naturally, I disagree. The will of the people is many things, often contradictory. And David Cameron assured the Commons that the referendum was non-binding on Parliament.

I’ll discuss the political chances of a 3-way vote later; first, let’s discuss the practicalities. Parliament doesn’t do 3-way votes. During voting, MPs traipse through one of two doorways: Ayes and Noes. The whole process, constitutionally and architecturally (two doorways), is binary. Secondly, there’s a whole business of motions and amendments. But, in principle, two votes would be needed: (a) accept or reject the proposed deal and (b) leave on the basis of the deal or no deal (depending on the first vote) or withdraw from the Article 50 process and stay in the EU.

So far, so logical. But, I hear you say, which vote is taken first? Good question, I reply. From a purely logical and practical point of view, it doesn’t matter. But the politics is very different! The deal / no deal vote must come first: putting the status quo against an uncertain alternative is not the action of a politically weak leader.

Spectrum of Choice

We first need to use our logic and reason a bit more to establish the relationship between out three choices. It’s easy to see that two of them: stay in EU and crash out are polar opposites. It’s equally obvious that a deal will sit somewhere on a spectrum between these two extremes. Deals always mean compromises. So any agreed deal will have its “Leave-ish” elements and its “Remain-ish” ones. In other words, it won’t satisfy everyone. But will it satisfy anyone?

Let’s explore this. At the two extremes of public opinion, the answer must obviously be “no”. But there is a difference between the two extremes. In my observation, people who most strongly support Remain do so for rational reasons based upon evidence given by (much-derided) experts and most often about the impact on the economy and jobs. At the Leave end, the people (full declaration: whom I called “rabid” earlier!) appear to me to be totally irrational. The desire to leave is driven by a mixture of nostalgia, post-imperial delusion, xenophobia and (for a minority) racism. Plus, of course, a good deal of “fuck you all, no one listens to my – very real – grievances”. It’s no coincidence that the strongest predictor of referendum voting statistically is the amount of education a person received: the more educated, the more likely to have voted Remain.

The important point about this analysis is that only one of these two groups is susceptible to reasoned argument. There is an asymmetrical public order threat lurking behind all this.

Will the Deal Pass the Commons?

The short answer is “no-one knows!” Anyone who claims they can predict this, in the light of recent events, is a fool. But we can put some boundaries around this. (By the way, all this assumes Theresa May will still be PM by the time of the vote – far, far from a foregone conclusion!) Both main parties’ MPs are split on how they voted in the referendum: the Tories roughly equally, Labour with only a few Leavers. Their voters are split too, but with Tories generally more Leave and Labour more Remain. The Lib Dems gained practically no votes in the 2017 general election from their consistent Remain stance. But, come the Big Vote, what then?

Firstly, it will depend on whether May sticks to her guns on offering only one vote: deal or crash out. If she does, many Remain MPs will vote for the deal as the lesser of two evils, even if the final agreement is more Leave-ish than Remain. But the opportunity to possibly bring down the government if the vote goes against the deal will complicate the motives of opposition MPs. And, of course, where the deal sits on the Leave / Remain spectrum will influence MPs’ choices.

On the other hand, if May concedes a second vote up front (and political pressure – Labour plus principled Tory Remainers – may force her hand), the dynamics change. More MPs may choose to reject the deal in the hope of retaining the status quo. But this has its dangers: the “will of the people” argument, clearly present in the Commons vote to nod through the triggering of Article 50 earlier this year, will raise its ugly head with even greater frenzy: the stakes are really high now! So the risks of a crash out may be increased in this case.

Can the Government Survive?

Could May and the Tory government survive a defeat in the Commons on a motion to accept the negotiated EU deal? Probably not. The chances of a fall are greater where May has refused a second vote. The most important, far-reaching plank of government policy by far in my lifetime is rejected by MPs. It’s impossible to see May survive even one day: think of David Cameron on 24^th June 2016.

So what happens next? May tenders her resignation to the Queen. She may or may not offer to stay on a caretaker PM. The Queen may or may not accept this offer. Constitutional crisis already! Is there another current Cabinet member who could unify the country and see us through the next critical steps? Obviously not! – just list the names in your head. (And that’s without factoring in how many of the current Cabinet members will have been forced to resign through sexual misconduct!)

So the most likely outcome is another general election – the third in four years. Meantime, the EU clock to 29^th March 2019 keeps ticking. Would any caretaker PM want to bind the hands of the next parliament? I hardly think so. The interim PM may well ask the EU to please stop the clock. The EU may or may not agree – but if they do, there’s bound to be a price which ardent Leavers will hate even more. But, in the chaos, that second commons vote (which is now “stay or crash out”) is far from certain to happen at all, whether May had offered it or not.

What’s more, crashing out of the EU whilst there’s no UK government would cause huge disruption – but someone would try to sort out some solutions to keep food and goods flowing, planes flying and so on. Whether it’s a temporary continuation of EU membership or some botched-up set of arrangements, the detail will be agreed between UK and EU civil servants. The UK’s de facto policy making will have been taken out of Parliament’s hands!

Where’s Parliamentary Sovereignty?

Well, that’s all very exciting, but where does it leave Parliament’s alleged sovereignty and the UK’s “taking back control”? The logic of the above argument is that, if Parliament rejects the government’s agreed EU deal, the government falls and Parliament loses control of what happens. And it loses its sovereign right to the second vote. If it votes to accept the deal, suspicion will always remain that this happened only to avoid the alternative chaos. So like the traditional shotgun marriage, Parliament cannot be said to have exercised its free will – and so is not sovereign.

So, heads you lose, tails you lose. The only way to avoid this is not to call a referendum in the first place.