Brown must stop sounding like a sore winner

‘I was born for this moment,’ Gordon Brown is said to have told a small group at a recent dinner party. The Prime Minister is too keen a student of history not to have known that he was parroting Winston Churchill’s famous remark on becoming Prime Minister in 1940, ‘I felt… that all my past life had been but a preparation for this hour and for this trial.’ Perhaps it was reasonable of him to contend that the current financial crisis is as dire a threat to the British way of life as Adolf Hitler, perhaps not. But why quibble? The Prime Minister is entitled to his bump in the polls, the new spring in his step: ‘a dour man rejuvenated by the gloom’, according to my Sunday Times colleagues. The nation certainly faces a grave economic threat, and Brown has reason to feel he has risen to the occasion with a plan that might prove every bit as important as his long-ago decision to grant the Bank of England partial independence.

The Prime Minister’s plan to recapitalise the banks goes straight at the problem in a way that other rescue plans do not. Plans to guarantee savers’ deposits might prevent runs on some banks, but in the end will do little to get the major banks to lend again. US Treasury Secretary Hank Paulson’s original $700 billion plan to buy dicey IOUs now on the banks’ books will do nothing to add to the banks’ capital unless he overpays for those assets, which he says he will not do. So he has now agreed to devote some of the funds to a Brown-style investment in nine leading banks.