Had I not known that it was Cuddly Ken on the radio yesterday, I would have thought I was listening to the dictator of a small Third World country.

The Mayor of London brushed aside every charge against him, on the ground that he had been put in power to do as he liked. Had he used public money to campaign against his old enemy, Trevor Phillips, and stop him becoming head of the new Equality and Human Rights Commission? “Not against Trevor, but what he was saying against multiculturalism... which was very damaging.” Had Ken Livingstone's officials campaigned for him at the last election while being paid by the taxpayer? “It would be 1984 if they couldn't have any political activity.” Is this a personal fiefdom? “That's what Tony Blair...set out to create.”

This interview exploded the myth that Mr Livingstone is the people's rebel, the honest outsider. He is the consummate insider, and disarmingly frank about it. Forget the petty gripes about his whisky drinking or his reliance on a bunch of old Trotskyites. If the best that Socialist Action can do is to sting SUV drivers, the revolution is over. It's not communism that matters, it's cronyism.

The charges of misusing public funds are serious. It is alleged that the London Development Agency (LDA) threw money at organisations that have little or nothing to show for it. Some were not even registered either as companies or charities, and some were run by friends of Lee Jasper, the mayor's equality adviser. Between 2003 and 2006 City Hall gave £1.8 million to companies that have since been struck off or liquidated, some only months after receiving the grants. A regeneration agency is bound to back some failures. But organisations that are now being investigated by the police should have been properly audited earlier.

On Tuesday Lee Jasper's deputy, Rosemary Emodi, resigned after admitting she had lied about a freebie trip to a Nigerian beach resort. Her companion was the head of Brixton Base, an organisation that has not yet satisfied LDA auditors as to what it has done with £510,000 of City Hall money. The patron of Brixton Base is Lee Jasper.

Sloppy accounting is one thing; harassment is another. The head of a ballet academy has won an injunction against two directors of the Green Badge Taxi School, a former LDA-funded project with whom she shared premises. She claims they mounted a campaign of intimidation after she started querying their finances. Her MP Kate Hoey describes the situation as “Thirties Chicago”.

Without Ms Hoey and the dogged reporting of Andrew Gilligan at the Evening Standard, none of these issues would have been aired. The country is awash with regulators but the mayor seems untouchable. The London Assembly, which is supposed to hold him to account, is unable to do so. It can only vote down his annual budget, for which it needs a two-thirds majority.

Mr Livingstone argues that his unfettered executive power was necessary to drive through changes such as the congestion charge. But he is wrong. American mayors are accountable to legislative councils, but they still get things done. In less time than Mr Livingstone has been mayor, Michael Bloomberg has reversed New York's fiscal crisis, built a record number of starter homes and taken control of all schools. It's hard to imagine Mr Bloomberg telling journalists to “go to Nigeria and find out” when asked about Ms Ebodi. But then it's hard to imagine him employing Mr Jasper.

Whitehall would not have blocked the congestion charge, as Mr Livingstone claimed yesterday, because Whitehall invented it. Nick Raynsford, the Minister for London, wrote “road user charging” into the legislation that created the role of mayor long before Mr Livingstone ran for office. Mr Raynsford spotted a chance to trial unpopular road pricing and foresaw that a mayor would jump at the chance to use it to raise revenue. Mr Livingstone implemented it; but it was not Ken against the world.

I was one of the people who campaigned for a mayor in the 1990s. Those of us who were trying to regenerate the city had to navigate a maze of quangos and boroughs. We wanted someone to adjudicate, someone to drive through strategic projects. Above all, we wanted accountability.

Mr Livingstone was the most capable man to stand, but his late conversion to the concept of elected mayors should have been a warning. Mr Livingstone, like his new friend Hugo Chávez, is not especially interested in democracy. His legacy will be a skyline of monuments to himself - many of them ugly offices and luxury flats - built by the developers and architects he befriended, legitimately enough, but with no consultation with the public.

It would be wrong to conclude from all this that the mayoralty should be abolished. The assembly needs proper powers of scrutiny. But the mayor's job also needs to be bigger, if we want our own Bloombergs to apply. Boris Johnson is not Bloomberg, and his new hair cut will not be enough to guarantee him a win on May 1 if his policies are still tangled. But he should put down a marker, now, by stating that he will not seek office for more than two terms.

Tony Travers, the LSE professor, likens Ken Livingstone to Jacques Chirac, because of his “tenacity and capacity for policy zig-zagging”. Professor Travers is too polite to draw the other obvious parallel: an almost Gallic arrogance that has grown with every year in power. Mr Chirac decided not to seek a third term in 2007 after allegations of cronyism and misusing public funds. Ken, take note.

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