Brown's admitted his mistake - but we let him get away with it for far too long

Patrick

"Yes. Of course politicians make mistakes and I've got to be honest that we've made mistakes."

"I" (Gordon Brown) admit that "we" (politicians) make mistakes.

Not what I would call an admission of a personal mistake. But just what one would expect in the circumstances from this man.

chris

Sackcloth and ashes time, is it?
Fraser, anyone over the age of 50 with a memory still intact knew 3 years ago that we were heading for the buffers and by 2 years ago that we were not going to get the constrains applied to stop it. We just waited for it to happen and have been amazed how long it actually took and how bad it actually is.
The real tragedy is the incredible waste of money, by the government, and by the public.
Greed and stupidity are the reasons. It doesn't need an intellectual treatise.
If and when we get back to some sort of normality, we won't need the sort of bankers and 'financial services' we have had to put up with for the last 20 years, and good riddance to them.

Nicholas

Interesting. "Got to be honest" reveals a certain unwillingness to be honest. "We've made mistakes" suggests he doesn't like being singled out for the rap, even though "No more boom and bust" was a declaration by Brown alone and not his party.

He is psychologically flawed and appears incapable of telling the plain truth without dressing it up.

ChrisD

"I failed, too. I didn’t realise the significance of household borrowing trebling over the Labour years, and bought the guff about it being okay because repayments were affordable."

Way back in about 2003/4 I began to get really worried about the huge explosion of personal debt.
In fact, I got so frustration watching the media reel out every increasing debt figures year on year with barely a raised eyebrow.
I also remember the regular media reaction of "its okay, because repayments were affordable".

I will never understand the subservience of our media in accepting that debt could just keep spiralling on the back of cheap credit without any payback.

Good on you for admitting this, but sadly many of your colleagues will not. And that is the biggest problem right now. If they didn't understand this ticking time bomb and bought into Brown's claims last time.
Are they even now, still not realising the sheer scale of our present problems?
I ask, because of their build up of Brown as some sort of superman, he is not, he just happens to be in government and holding the economic levers right now.

Athesius the Facilitator

Excuse me Fraser! It wasn't just Jeff Randall and John Redwood that saw this coming. I am just a ten a penny aircraft fitter but I was aware of this problem as soon as the Labour party started driving down interest rates in the late 90s. It is simple McAwberism. But I am surprised it took so long to go pop. I despair at all the people in the Westminster bubble they are so removed from reality. Poor old John Redwood was thought of as a complete "dick head" and he has now been vindicated. I suspect that one or two others in Westminster thought the same as he did but either didn't care or were to frightened to say anything. AS for John Mcfall who has been the chairman of the finance committee for about ten years. Words fail me! He's just an "oxygen thief" that bloke. He sniffs around Gordon like dog on heat. He should resign.

bill

I am not in my 50s. But I did experience the Japanese asset and the UK property bubbles in the 80s and 90s. Once bitten, twice shy is the saying. I was a schoolboy learning the basics of monetary theory when Labour last brought this country to its knees; I have been patiently watching the same protracted process since 1997. I am surprised it has taken so long. I thought it was plain to see five years ago. As for the opposition, the least said the better. They are almost as undeserving of my vote as Labour.

Ponzi Pete

Many saw the house price bubble inflate. The elite got high on property prices and property porn. The masses joined and madness ensued.

It started from the top and went all the way down.

Many will now be skinned for their greed and folly.

Economic history will laugh at Gordon Brown, a man who lost his mind during the biggest boom in British history. He bequeths now the biggest bust. In fact he may bankrupt the country.

It's almost hysterical if it weren't so god damn awful.

Tiberius

So, back to reality.

Does this admission now allow Osborne to parenthesise his criticisms of Brown with "as the Rt Hon gentleman himself has admitted, and is therefore not qualified to lead us out of this mess?"

The mea culpa stuff is all bit self-indulgent, if you don't mind me saying so, Fraser. Most commentators (including yourself) knew Brown would ruin the country - it was just a question of the detail.

The biggest culprits of all are still our voters who fell for the New Labour lie when the Cameroons were still in nappies. Like many who post on here and particularly on the DT comment section, I despair of the faculties of many of my fellow citizens.

BTW I am surprised Brown didn't qualify his admission by blaming the Tories. He has said they were to blame for the gold sale, but it must also be their fault for leaving him such a golden inheritance, which otherwise he couldn't have squandered. And I bet if he did say that, 20% of those who will vote at the next election would believe him.

Tory Granny

As it was too-low interest rates that brought on this trouble, why is it right to lower them now? Surely, people should be saving, and the government doing the fiscal equivalent i.e. spending less, and interest rates should be going up, however painful that will be. Can anyone explain to a non economist what the flaw is in that argument?

mac

Given his colossal ego, Brown can have made this grudging 'admission' only with extreme reluctance. Surely, he was pressed to do it by Mandelson-Campbell?

But why? A bit of cod-humility to blunt Tory jibes at his 'no more boom and bust' hubris? And again, why? To reduce the impact of that that own goal in preparation for a 2009 election, perhaps? Every little helps, as part of the Campbell campaign 'grid'.

There are those who insist that Brown's too much the bottler to contemplate an election next year, but this comment to J Vine surely is further evidence that Brown is listening to Mandelson . . .

TGF UKIP

Looking back there were many sensible people and many journalists who saw and talked or wrote about the bubble and its unsustainability. The trouble was, though, it persisted and swelled for so long that the "soft landing" became more and more easy to expect.

We told ourselves that it couldn't last but it kept on lasting. Suddenly, though, very suddenly it stopped and burst and instead of a "soft landing" there was a resounding thud.

PS Fraser, Now that by implication you admit that your client Osborne got it massively wrong, do you think we should have John Redwood (who you admit got it absolutely correct) in the right job as Shadow Chancellor?

chris

Alstair Darling has the chance to go down in history as a great man. All he has to do is to explain his predicament since he became Chancellor, truthfully, and what he REALLY believes is the best course of action for the economy and the country.

This will require an enormous amount of bravery, as politicians do not do this sort of thing.

He will become a national hero if he faces the cameras to make his speech on Monday, starts reading it, and then stop after about 30 seconds, look at the cameras, and say that that was the start of his prepared speech, but what he really wants to say is this .......

Has he the moral courage? Probably not, but he will surely come to regret it.

mart

Fraser, at least you were in good company.

My question is, what ought to have been done differently?

Would it have been sufficient to broaden the remit of the Monetary Policy Committee so that they took private and public indebtedness into account when setting the interest rate?

Hysteria

The flaw, Granny, is that deflation is worse than inflation - if you are saving, you are not spending - and so shops, truck drivers factories etc. cease to have a market and more and more people are thrown out of work. They demand/expect/deserve support from the state - which needs to keep on driving up tax to pay for it, and/or borrow from the money market. But the cost of that borrowing keeps going up as the pound declines in value. So - although I wouldn't choose to start from here, "we are where we are" - we have to avoid deflation.

We then get into political territory as to how to do it - tax credits, reduced general taxation ect etc

Re the "we never saw it coming story" - this is just lame - many of us saw it and posted at the time "consolidate all your debt into one easy payment and leave some extra for a holiday" - we said at the time this was unsustainable (and in a business context - transfering capital expenditure to operations) probably in breach of accounting rules !!!

TrevorsDen

"I've" got to be honest that "we've" made mistakes. Yes well ...

I am reminded of the joke where the Lone Ranger and Tonto are surrounded by hoards of indians on the war-path.

"We're in trouble, Tonto" he says.
"Who is this 'we' white man, replies Tonto.

Christian Gowers

Wow!

You mean the claim that he'd eliminated one of the fundamental principles of economics simply by saying so turned out not to be true!

Simon Stephenson

Fraser

Congratulations for writing this article.

I think the key point is the one you make about the likes of Randall, White and Redwood being belittled and treated as mavericks.

It's not so much the fact that this has happened, but the severity with which the mainstream savages dissent. It seems to me, though maybe I'm wrong, that this gets greater and greater as time goes by.

Am I right? Is orthodoxy becoming more intolerant? Does it matter?

Fraser Nelson

Mart, the MPC should have had a remit to watch asset prices and personal debt levels and kept rates higher and accepted mild defelation between 01 and 03 realising it was a one-off shock from gloablisation. That would have kept debt to 120% of income, not 178% as it is now.

The Bundesbank used to have a keen eye for asset bubbles, and its DNA is in the ECB which is why the ECB didnt cut as much as folk pressurised it to.

Fergus Pickering

My wife bloody well knew. She's been banging on to me about it for at least two years as we tramp round the woods a the bottom of the road. She knows about these things. I don't being an arty type like most of you journalists, except Geoff Randall and Roger Botle, the ones who are actually expert in the field. As for the unspeakable Brown, he goes from total denial to a tetchy 'we were all wrong'at one bound. As you say, that great man John Redwood wasn't wrong. But nobody wants a Cassandra in the ranks, do they?

oldtimer

He now needs to be nailed on other lies. For starters, as I have posted before, the G-20 did not support an unsustainable fiscal stimulus such as the one we are promised for Monday. Nor did it put all the blame on the USA, as Brown and co do - incessantly and at every other opportunity. These lies need to be nailed.

The debt crisis is typical of Brown`s track record - bungling incompetence - but this time on the grandest and most horrifying of all scales.

As for me, born in a depression to a father who just lost his job, I have been financially conservative all my life. Fortunately, over the past few years, I have been able to persuade my children to pay down most their mortgage debts over the past two to three years and to put aside something for the rainy days that are now upon us. We did not all believe Brown.

oldtimer

Postscript to my earlier post:
Even though he may have admitted a "mistake", has he apologised for it?

Roy Simpson

In the 1990's the then opposition, Labour and Liberal Democrats, were strong supporters of the UK joining the ERM which the Conservative Government subsequently did.

However, it was the Government, of course, who eventually took the decision to join and as a result alone took the blame for the disaster which it turned out to be, with both opposition parties escaping any charges of culpability or liability.

In the same way, the present government must alone take full and total responsibility for the current debacle. The buck stops with them, and with Brown in particular.

Ian C

"Brown, like Greenspan, thought we’d entered a new era of permanently low interest rates".

Brown believed this because Greenspan told him this was the case - and Greenspan had done well in the 90's but had coem to believe his own publicity by 2001 and commanded the world that more of the same was the answer.

What must worry us all is that he is still advising Brown.

Alex R

Fraser,

It is too much to ask the MPC to monitor asset prices. It is not fesiable for them "to lean against" asset bubbles.

They will have enough of a struggle trying to keep inflation within acceptable parameters without being asked to do more.

Arthur

Inflation targeting is still right for its time - it is right for all times. The only problem is that we have not been targeting inflation but something called the Consumer Price Index. Part of government failure has been to suggest that the CPI is the same thing as inflation. One Milton Friedman had other ideas, only no-one actually understood what he was saying about the supply of money.

P.S. I saw it coming and moderated my spending and debt (nil) accordingly. But, now it seems that I am expected to pay for other people's ignorance and profligacy. No wonder people like me are beginning to hate New Britain.

quadratus

I make no apology for repeating that which I have posted before,namely that to abolish credit cards and provide that all balances are automatically cleared from the borrower's account at the end of the month.
This is the system in use in other countries and effectively protects people from themselves. One has to accept that many many card holders are manifestly unable to quantify and manage their debts, and even fewer to master compound interest.

Alan Douglas

Fraser, I do NOT see where “Brown's admitted his mistake” per your headline.

Brown said “Yes. Of course politicians make mistakes and I've got to be honest that we've made mistakes.”

Brown has generalised that “politicians” make mistakes. So that is ALL politicians. Nothing to do with him specifically, except insofar as he might also be a member of that tribe.

“I've got to be honest” - a sure sign of the opposite

“that we've made mistakes” - “we” is NOT “I”. So who is “we” ? Answer : all politicians, which leaves hanging though unspoken “such as Thatcher who blah blah, Major who diddle-di-dum, even Blair who rada-rada”.

There is not a shred of Brown accepting that HE made a specific mistake peculiar only to him, nor of any remorse or apology. And there can’t be - Brown is so delusional that to him it is inconceivable that HE could make a mistake - to do so would shatter him, in effect kill him - he is asserting rightness, as he always has. There is nothing else in his universe.

Alan Douglas