Peter Riddell
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For Gordon Brown, government activism is now everything. So expect a flood of initiatives over the coming weeks, starting today with a three-day tour of Britain culminating in the third away-day Cabinet meeting on Thursday, this time in Liverpool.
Then, a week today, there will be the first of a regular series of summits of government, business and unions. The first will be on jobs, followed by one on skills. Just before the Christmas holiday, Whitehall departments were told by Jeremy Heywood, the Downing Street Permanent Secretary and policy enforcer, to come up with fresh ideas to be announced at the summits.
Mr Brown promised yesterday to “create” 100,000 jobs by bringing forward school repairs, new hospital projects, low-carbon schemes and infrastructure programmes. But it is never clear how many are genuinely new jobs, rather than replacing ones elsewhere.
This is part of a three-prong approach involving help for businesses to retain workers; assistance for those made redundant with training and placing in new jobs; and mortgage-protection schemes to limit repossessions.
All this is in addition to what business sees as the more fundamental task of inducing the banks to increase their lending, in order to ease the acute shortage of credit that may lead to further company collapses and redundancies. More action is likely soon.
On the BBC One Andrew Marr Show, Mr Brown made clear that the aim is to show that government “can make a difference” and to act in ways that previous governments did not. This reflects the characteristic Brownite themes of “being on your side” and of creating a dividing line with the allegedly defeatist and do-nothing Conservatives.
Mr Brown has been heavily influenced by Franklin Roosevelt’s New Deal in the United States in the 1930s. The Prime Minister named in The Guardian, as his Christmas book, FDR: The First Hundred Days, a largely sympathetic account by Tony Badger, a Cambridge professor of American history. Professor Badger argues that FDR “demonstrated that a democracy need not be paralysed in the face of economic catastrophe”. His actions halted the collapse of confidence in the banking system in 1933, and stopped the relentlessly deflationary spiral.
Yet, as Professor Badger shows, the initiatives were often contradictory (both cutting back government and expanding public works), while the Hundred Days did not provide “the magic key to economic recovery”. Indeed, by keeping prices up and controlling production, the National Recovery Administration stalled, and delayed, a full recovery.
For Mr Brown, the key message, however, is that government activism can be crucial when markets fail and do not adjust. The problem now, as in the 1930s, is distinguishing between actions needed to bolster and restart the system and intervention that subsidises the inefficient and delays recovery. That will be the central political debate this year.
Peter Riddell has been a leading political commentator and an Assistant Editor for The Times since 1991. He writes mainly, but not exclusively, about British politics and has published several books on British politics, including not one, but two, on Margaret Thatcher
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James
You have hit the nail on the head, in one, absolutely spot on.
I can't wait for the fool to go.
John, Chester,
Stop lending money to people who cannot afford to pay it back. Thats a start Mr Brown.
Kerry , London,
The problem for Brown is that the shakers and movers in the UK markets almost all hold him responsible for the mess we are in. If the solution is a return to confidence, then that will and cannot happen until Brown goes.
M Lumley, Leeds,
Brown thinks that rushing around attempting to look active will persuade everybody to forget his part in the disaster that is now unfolding, but his ideas have not worked and he clearly does not have any answers.
This say and spend anything, achieve nothing approach, is no longer fooling anybody
James, leeds, uk
Come on, Brown hasn't had a fresh idea since I don't know when.
Paul, Milton Keynes, UK