Has Gordon Brown suffered the equivalent of Black Wednesday? While this may seem a hackneyed question, I feel obliged to offer a detailed answer. Partly, this is because I was among the first to make the comparison, on that memorable weekend just before the Treasury rescue, when queues snaked outside branches of Northern Rock. Mainly, however, because I disagree with the vast majority of commentators, who dismiss the historical parallel as misleading. I am convinced, by contrast, that it is uncannily apt.

The case against my comparison is plausible, at first sight. Britain's expulsion from the European exchange-rate mechanism in September 1992, 15 years to the day before the run on Northern Rock, undermined John Major's entire economic strategy. Even more importantly, it caused a collapse of his credibility and self-confidence, to the point where the Prime Minister was said to have “wobbled” psychologically for a crucial two hours when he disappeared from view. It is surely an exaggeration to suggest that anything similar has happened to Mr Brown, either last September or this week. Or is it?

Starting with economic policies, the Northern Rock debacle has driven a coach and horses through the two “fiscal rules” that Mr Brown claimed as the lodestars for all his public spending and tax decisions since 1997. It has discredited key aspects of his decision to give independence to the Bank of England, which used to be regarded as the Blair-Brown Government's one unquestionable achievement. And it has turned Mr Brown's reputation for prudence and economic competence into a sad joke.

It is far from clear that the combined impact of all these economic blows will be much less lethal than the pummelling that Mr Major suffered 15 years ago - especially considering that Britain's economic performance began to improve almost immediately after Black Wednesday, whereas the year after Northern Rock is likely to prove a bleak one.

But looking beyond economics, there are two political issues that suggest that the Brown-Major comparison is even more apt. The first is what these defining crises revealed about the two prime ministers' personalities and capacities for leadership. The second is the intellectual and ideological vacuums that both crises disclosed.

Regarding personalities, Black Wednesday revealed a Prime Minister unable to face reality or think more than a few days ahead, after watching the collapse of a totem with which he had foolishly identified his virility and self-esteem.

A similar state of confusion and denial is what we now see in Mr Brown. In reacting on Monday to his nationalisation announcement, I wrote that Mr Brown now seemed to be following Lewis Carroll's advice to believe in six impossible things before breakfast every day. He has been embracing impossible contradictions since the day he became Prime Minister - ranging from the inconsistencies in his foreign policies through his attitudes to climate change to his faith that wealthy foreigners would pay up, instead of leaving Britain, in response to his unprecedented tax assault.

But as I am arguing about Northern Rock's pivotal importance for Mr Brown's psyche, let me now give six examples of the impossible delusions created by this fiasco alone.

That nationalisation, backed by the biggest public subsidy yet paid by any government to any business anywhere in the world, was just a case of “business as usual” and would be accepted as such by Northern Rock's competitors and the European Commission.

That a private sector rescue was ever remotely possible, when every serious financial expert argued that Northern Rock should be nationalised or put it into administration within days of it requesting Bank of England support.

That a bailout requiring £25 billion of government guarantees and subsidies would ever be seen as a “private sector solution”.

That Northern Rock shareholders could be told their bank was insolvent and worthless, while the European Commission and employees were told that this was a viable company, whose long-term future would be secured.

That Northern Rock had a “sound book of assets” when it was the country's biggest lender of mortgages worth more than the houses on which they are secured.

Above all, that nobody would see through the hypocritical double standards that allow bankers to enjoy government loans of £110 billion, equivalent to £18 million per Northern Rock employee, while manufacturers, exporters, nuclear generators and alternative energy suppliers are denied loan guarantees worth paltry millions and once-great companies such as GEC-Marconi or MG Rover collapse without the Treasury offering a penny of support.

The obvious injustice of subsidising bankers, while industrial workers and managers are told to live or die by commercial success, points to the most troubling lesson for Mr Brown from the Major years. Both prime ministers, after suffering their traumatic crises, seemed incapable of redefining their “narratives for government” to take account of the new circumstances they faced. Moreover, the failure of both prime ministers was related to the same issue: a lack of mental flexibility and, in particular, a stubborn refusal to reconsider key relationships between the private sector and the State.

Mr Major's fatal mistake after Black Wednesday was to pretend that the dogmatically monetarist anti-inflation policies of the 1980s remained intact, when in fact his Government had been freed to pursue a pro-growth agenda more akin to the Keynesian demand management of the 1960s. As a result, Mr Major never got any credit for the recovery that followed Black Wednesday, and was unable even to consider the key institutional reforms, above all Bank of England independence, implemented by Labour as soon as it came to power.

Mr Brown now faces a comparable challenge. Northern Rock, along with the wider international banking crisis, has discredited the post-Thatcherite faith in unbridled market forces and triggered a debate about the necessary role of government in managing a market economy. The pendulum of opinion is manifestly swinging away from market fundamentalism and towards a closer symbiosis between the private sector and the State. This shift of opinion should offer an enormous political opportunity to Labour.

But just as Mr Major failed to gain from the shift in political consensus to the right in the late 1990s, because he was still in denial about his earlier blunders, Mr Brown now finds himself on the wrong side of the swing to the left in opinion.

Instead of arguing that the State can sometimes provide services efficiently or help to shape the future economy of the future, he finds himself defending the indefensible: a £100 billion support package to the least viable company in the one industry that everybody wants drastically shrunk. And while ministers scratch around for spurious self-justifications, serious thinking about the new settlement needed between the private sector and the State is left to the Tories.

In short, the Opposition is starting to fill the intellectual vacuum created by a Government in denial: the last, and most ominous, similarity between Major and Brown.

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