Martin Bright

Can the Government Dig Itself Out?

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If you just read one newspaper today you'd know things were getting pretty bad for Gordon Brown. Let's take the Observer for example: not exactly a hostile paper to the government over the years. Beyond the story of the defection of former DWP advisor David Freud to the Tory front bench, there's a terribly damaging piece of analysis from Andrew Rawnsley. He observes that a serious split has opened up in Cabinet between the "no contrition" camp and those who believe the Prime Minister should find a way of showing some humility over his role in the economic crisis. As readers of this column know, Downing Street has been taking a close interest in President Obama's recent public apology. But as a ministerial source told Rawnsley: "Gordon will never change. He does not do apologies."

Rawnsley's account of the exchanges at Cabinet is embarrassingly detailed:

"Harriet Harman led the charge by broadly repeating what she had said in a banker-bashing speech in Yorkshire a few days earlier. She argued that bonuses should be clawed back. When bankers compete with paedophiles for bottom place in the league table of public esteem, there's no doubt that Ms Harman vents the fury of many voters.

But her intervention did not impress all of her colleagues. "Knee-jerk, crudely populist stuff," sniffs one member of the cabinet. There was a sharp response from John Hutton and Hazel Blears who warned that it would be perilous in the longer term for Labour to be seen as hostile to business. Ms Harman retorted that it was hardly anti-business to be anti-banker because no one currently hates bankers more than businesses struggling to get credit.

Ed Balls weighed in against her with a warning about swinging too far with the hang-a-banker mood. He advocated what Tony Blair would have called a Third Way: public fury about past excesses had to be satisfied, but it would be a disaster for Labour to become seen as an enemy of wealth creation.

Peter Mandelson observed to his colleagues that the furore over bonuses was symptomatic of a larger danger of looking as though they were being blown this way and that by the prevailing wind in the media. The government had to look anchored to give confidence that they knew what they were doing. Gordon Brown himself did not say much at all."

Add to this the increasingly embattled approach taken by the court around Brown and the times look very dark for Labour. The strangest, but perhaps the most revealing story is Toby Helm's account of the in-fighting at the super-union Unite. I've been picking up for some time from Labour MPs that there is deep unhappiness at the way Brown's former special adviser Charlie Whelan has been throwing his weight around at the union. Toby has the scoop on the staff, including former Labour MP John Cryer, who has been off long-term sick and Unite's political officer Sarah Merrill, who has been sidelined by Whelan.