Who'd be an inky-fingered figure-flinger? Last Saturday week both capitalism and Gordon Brown were dead; by Friday both were saved. The prediction business has rarely seemed so perilous. Even so, I'll risk my reputation, for what that's worth, and predict that capitalism has more of a future than Brown.

Some don't think so. Yesterday morning, here in Manchester, the conference hall belonged to those Bourbons of the centre Left, the trade unions. Somehow all their motions had been pushed together into the same space, meaning that the delegates could enjoy several Cro-Magnon speeches each by the joint general-secretaries of Unite, Derek Simpson and Tony Woodley, and the boss of the GMB, Paul Kenny. The result was a sort of convention on an offshore leper colony, except in this case the lepers didn't even realise they'd been marooned.

So, to sporadic applause from a thin crowd, we got lots of enthusiastic stuff about a composite enemy consisting variously of spivs, speculators, hedge fund managers, greedy oil companies and the employing classes treading ordinary people underfoot. There was a bit more of spring about their complaints, because they were getting the dangerous old idea that the people of Britain were on their side. That antique Bennite flirt, Michael Meacher, declared that a windfall tax would be “extreeeemely popular” - which is very popular indeed - and then demanded, as in the good old days: “Is our Government on the side of big business or on the side of the poor?”

One delegate near me, trying (I think) to be supportive, replied: “Big business!” In a way she was right, because the notion that the party is gagging for a return to the days of coal boards and national plans is overdone, as was shown by the applause by many more in the afternoon for the reformist heir-presumptive, David Miliband. All but the most wilful Labourites know in their waters that the capitalists were partly responsible for the as-yet-fairly-comfortable bust, then they also had something to do with the much longer preceding boom, a boom in which the public sector workers, represented by the unions, have most certainly participated.

This brings me to the counterintuitive part of my argument. My contention is that the last 11 years of Labour's co-habitation with capitalism have meant most people's standard of living improving substantially, and life expectancy has risen well above predictions; health and education standards have also risen, while unemployment and most crime have fallen. Until the past few months we hadn't felt the chill breath of an approaching recession on our delicate napes for a decade. Also important, I think, is that Britain in that period has become a markedly more tolerant society, as measured, not least, by the new homophilic Conservative Party.

But global capitalism, ever-evolving, innovative, restless and amoral, constantly forces change. It disrupts communities, tears down buildings, sends children across the ocean and replaces them with strangers, closes post offices and village shops, destroys the demand for some jobs and creates demand for entirely new ones. People want the wealth and choice that capitalism offers, but are now, I think, fed up with the change.

They want to be protected from change, but not to suffer from the inevitable consequences of protection. And when an attack of dissonance like this breaks out, who you gonna blame? I don't want to overdo the sympathy for Gordon Brown. He can be a rough, tough old overclaiming pol, whose own shiv-sinking acolytes stanched any heart-bleeding they might have felt for his stabbed predecessor. But Mr Brown does not, in terms of the record, deserve the 24-hour kicking he has received for the past year. What has happened, I reckon, is that he has become the lightning conductor for the zillion complaints and resentments caused by change. Something in his unexpected vulnerability, in the gap between his ambition and his self-confidence, in his terrible discomfort, has led him to be dragged, morning after morning, up to the Wicker Man, to be daily reburnt.

As he goes, he screams out the occasional desperate plea for mercy, couched in terms of a titanic Gordonian promise: national hospital cleaning, national lagging, national nursery places for every two-year-old. And all are treated with same disdain. You have to come to this conclusion, whether it is fair or not: that while Gordon is there, the electorate sees only him and nothing else and they are determined to kill him. Under him - HBOS reprieve notwithstanding - Labour is heading for a Majorite meltdown.

Despite the principal opposition party having gone more or less unscrutinised for the past year - in a way that never happened to Tony Blair - I think David Cameron has done enough to reassure the voters that he and his team are a fresh and steady enough bunch. And it is true that, walking around Manchester, I see far too many ex-ministers and perpetual backbenchers whose exciting years are past, and who know all too well what can't be done. Though I used not to think so, I now see that there is a cycle of democracy, which allows generational change in our political system.

The problem is that this desire for alternation is now so highly geared that Labour faces an absurdly humiliating defeat in 2010. The consequence of that might well be a long period of Labour's own descent into irrelevance and nostalgia, as the Left is strengthened and the Derek Simpsons and other mammoth-skin wearers become, once again, power-brokers in the party. In that case we could be talking about another missing generation of lost Labour leaders like Gaitskell or Kinnock, who never got a chance to serve.

In politics you always have to play to win. Why vote for a party that itself says it will lose? But in the cold watches around dawn, when the booze has worn off, Labour people have to admit that even the scale of any defeat is all-important and that having 250 MPs is ten times better than having 150.

So, there must be a change of leadership before the next election, the new leader must almost certainly be David Miliband, and he must win after a defining struggle with, probably, Jon Cruddas of the Left. That fight will allow visibility for Labour's ideas, for its (I love this phrase) “forward promise” to the electorate, and permit the party to do something other than be drowned beneath the nebulous tide of new Toryism.

Now all Gordon and the Labour MPs have to do is to bring all this about.

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