The honeymoon he had enjoyed with his party on his return to the Cabinet soured when he brought forward plans to part-privatise the Royal Mail. This aroused fierce opposition from a significant number of Labour MPs which would later force the Government to retreat. Mandelson sighed to a friend: ‘I have returned to my historical role of being hated by everyone.’109
Brown, though, was more and more politically and psychologically dependent on the other man. One civil servant described Mandelson as ‘Gordon’s heroin – every now and again he needs a hit of Peter.’110
There was a brief cessation in the party political battle in late February when David Cameron’s six-year-old son Ivan, who had suffered from cerebral palsy since birth, died suddenly following an epileptic seizure. Prime Minister’s Questions was suspended for the first time since the death of John Smith in 1994. Gordon Brown, whose newborn daughter Jennifer had died seven years previously and whose youngest son had acute cystic fybrosis, led the expressions of sympathy. His voice choked when he told MPs that the death of a child was ‘an unbearable sorrow that no parents should ever have to endure’.111 He achieved an empathy and authenticity in that moment which he struggled to display when talking about the trials and tribulations of voters enduring the recession. He was again making things worse for himself because of his habitual reluctance to ever admit to a mistake. A ritual became established in the Commons which was not to his advantage. Each week, the Tory leader would rise to taunt Brown to concede that he had got something wrong. In a typical exchange, Cameron demanded: ‘Will he finally admit: he did not abolish boom and bust?’ ‘Look,’ shouted Brown, ‘we can play his game of student politics as long as he wants to!’ Cameron came back: ‘Only one of us was a student politician and he has never grown out of it!’112 The Tory leader had hit upon a simple, but effective trap. Brown looked both silly and stubborn when he declined to accept responsibility for any errors during the ten years he was in charge of the economy. During his autumn revival, he had been combative and confident in the Commons. He was again sounding tired, cornered, monotonous and unconvincing.
Away from cameras and microphones, during his long nights of the soul within Number 10, Brown was often tormented by his mistakes. He ‘beat himself up’113 after he made another Freudian slip at the dispatch box and talked about a ‘depression’ when he had meant to say ‘downturn’.114 After parliamentary performances and speeches, he would anxiously demand reviews from his staff. He came back from an event with the Prince’s Trust in a self-flagellating mood, saying to aides: ‘I was no good – was I?’115 He agonised over whether he could have pressed the case for stronger international regulation more robustly during the boom years. ‘I heard many mea culpas from Gordon, but in public he just wouldn’t do apologies,’ says one minister close to him.116 The most that could be extracted from him was the grudging admission: ‘What we didn’t see, and nobody saw, was the possibility of complete market failure, that markets seized up across the world.’117
Brown looked more isolated when others did own up to error. His erstwhile hero, Alan Greenspan, admitted that he was ‘partially wrong’ in his economic theories and ‘shocked’ and ‘very distressed’ to find that he made ‘a mistake’ about ‘how the world works’.118 Brown’s inner circle tried to persuade him that the apology – or, rather, the absence of one – would remain the story so long as he refused to acknowledge any culpability. Douglas Alexander argued with Brown that they would not be able ‘to own the future’ until they had accounted for the past.119 Ed Balls broadly agreed that they would not be able to move on and take the argument to the Conservatives until they had released themselves from this snare.120 Balls, the co-architect of the regulatory regime, gave an example of what was required when he conceded to one interviewer: ‘In retrospect we all underestimated the risks and we were nowhere near tough enough. We need to learn from that and do it better in the future.’121 Alistair Darling also offered nostra culpas on behalf of the Government. Before a committee of the Lords, he accepted that ‘with the benefit of hindsight, lots of things might have been different. We need to tighten up our own regulatory regime.’122 To a newspaper, he conceded that ‘all of us have to have the humility to accept that, over the last few years, things got out of alignment.’123
Brown no more did humility than he did apologies. During an aggressive appearance before twenty-one select committee chairmen, in which he variously scorned questions from these senior MPs as ‘absurd’ or ‘ridiculous’, he continued to insist that ‘it started in America’ and refused to concede to a single mistake.124 ‘I found myself squirming as he refused, again and again, to apologise for any failings on his part,’ wrote Jackie Ashley of the Guardian, once a great admirer. ‘This has become embarrassing.’125
He began to retreat again into a mental bunker. His staff had to endure his angry tirades against the media for never reporting his speeches or giving him any credit. He leant even more heavily on Peter Mandelson, a constant presence in Number 10 who was now ‘intervening everywhere’.126 Shaun Woodward, the Northern Ireland Secretary, also offered himself as a comforter and emotional prop to the Prime Minister. One evening, around 7 p.m., the Business Secretary came out of Brown’s office to find Woodward waiting to go in. Mandelson arched his eyebrow and said: ‘Ah, the night shift.’127
Brown appealed for help from Alastair Campbell and Philip Gould, the chief propagandist and pollster of his predecessor. They joined the political strategy meetings inside Number 10, which were also attended by Ed Balls, Charlie Whelan and some Downing Street officials. Much of the time at these meetings was wasted looking for scapegoats. Whelan routinely mouthed profanities about Alistair Darling. Brown did not intervene to stop him, even though civil servants were witnesses to the cursing and bad-mouthing of the Chancellor. ‘It was all “Darling is such a useless wanker” from Charlie and not just from Charlie,’ says one appalled witness. ‘It was shocking to hear, especially when officials were present.’128
Cabinet discipline was fraying as those with ambitions to lead the party in the future began to position themselves for defeat. There was a steady drizzle of leaks about rows between ministers, notably when Ed Balls and Geoff Hoon went to war with the Miliband brothers over a third runway at Heathrow. Brown opened a Cabinet awayday in Southampton with a ten-minute lecture about leaks. He threatened them: ‘If this happens again, there will be an investigation.’129
*
The economy was shrinking savagely along with most of the world’s. Speaking in March, Mervyn King said: ‘I cannot recall any previous experience of such a sudden, severe and synchronised downturn in world output of the kind we have seen in the last three to four months.’130
The base rate was cut to 1.5 per cent in early January, the lowest in the Bank of England’s 315-year history. Two months later, it was brought down to a new record low of 0.5 per cent. At the same time, the Bank started to increase the quantity of money circulating in the economy. On Thursday, 5 March, Mervyn King began ‘quantitative easing’. The £150 billion, later raised to £175 billion and then £200 billion, was a much larger slug than most expected. The money supply was not increased by physically printing banknotes; the Bank created electronic cash, which it used to buy financial assets from banks in the hope of encouraging them to extend more credit to consumers and businesses. Britain was now in uncharted territory. A member of the Monetary Policy Committee, Andrew Sentance, called it ‘a step into the unknown’.131
In the same week, the FTSE 100 sunk to a six-year low. Labour’s poll ratings were also deeply bearish. From the end of January to the beginning of March, all five of the main polling organisations gave double-digit leads to the Conservatives. When Brown bounced after the first bank bail-out, one of the Cabinet described it as an opportunity for the Prime Minister to have a ‘second audition’ with the voters.132 He had failed it. Labour MPs slumped into renewed despair about their leader’s inability to communicate with the country. By a majority of more tha
n two to one, voters were of the opinion that Labour would do better at the next election led by someone else.133 Terrible poll ratings, crumbling parliamentary discipline and Cabinet disunity created a feedback loop, each negative fuelling the others. Brown had travelled through his own personal boom to bust. The ‘saviour of the world’ the previous October had crashed back to earth by March.
He still blamed it all on America. Yet it was to an American that he now looked for salvation.
36. Trillion Dollar Man
‘Have you heard from your friends in the White House?’ Gordon Brown asked Stewart Wood. Then the Prime Minister turned to Tom Fletcher, his Private Secretary. ‘What’s happening with the French and the Germans?’1 He had been pestering them for updates on a daily basis.
As soon as one race for the White House ends, another begins: the contest to be the first European leader to get a foot inside the Oval Office. The competition for the invitation was even hotter than usual because the new President was the most charismatic and popular politician on the planet. When Barack Obama was elected in November, there was a preliminary skirmish to be the first leader to put in his congratulatory phone call. Brown won that only for the Elysée Palace then to brief that Nicolas Sarkozy’s phone conversation was twice as long at half an hour. One of Brown’s aides scoffed: ‘Yes, but fifteen minutes of that was translation.’2
Number 10 had excellent contacts among the Democrats in the new administration, but there were anxieties that Obama would regard the British Government as ‘part of the Bush baggage because of Iraq’.3 The rival eyed most warily by Brown was Angela Merkel. Obama chose to speak in Berlin during his election campaign and identified Germany as crucial for rebuilding America’s relationships in Europe. Sir Nigel Sheinwald, the British ambassador in Washington, was left in little doubt that his life wouldn’t be worth living if the Prime Minister was beaten to the prize.4 The Foreign Office Minister, Mark Malloch-Brown, accurately observes: ‘It would have been a big thumbs-down if this beauty contest had not been won.’5
The good news came late, just ten days before the actual trip.6 It was gilded by a lustrous invitation to address a Joint Session of Congress. Tony Blair had to wait six years and fight a hugely unpopular war in Iraq before that rare accolade was bestowed upon him.7 One obsession satisfied, another and even greater one immediately consumed the mind of the Prime Minister: what would he say in his important address? ‘He thinks speeches are a noble thing,’ comments one official who worked with him on this one.8 A similarity between Brown and his predecessor was that both used the process of speechwriting to try to crystallise their thoughts and marshal their arguments. By the week before his trip to America, he was dragging his confidants in the Cabinet away from their departmental duties to help craft the address to Congress. Late one night, Douglas Alexander received a call. His keen interest in American politics was a resource that Brown wanted to tap. ‘What time can you be here in the morning?’ Alexander replied that he could get to Downing Street around nine. ‘Make it seven then,’ responded the Prime Minister and detained the other man at Number 10 all morning brainstorming ideas and phrases for the speech.9
He flew out to Washington on 2 March against a background of continuing scares in the financial markets and growing fears that this recession had the frightening potential to slither into a depression. The Dow Jones fell through 7000 points to its lowest level since 1997. The FTSE 100 was down more than 5 per cent to a low not seen in six years.
When they touched down at Andrews Air Force Base, Sue Nye performed her customary valeting service for the Prime Minister: brushing his hair and applying make-up before he got off the plane. He arrived in Washington to a modest fanfare. Brown still lacked the instant recognition in the United States enjoyed by Blair. As if like a ghost determined to spook his successor, he was also in the American capital, to make a speech about global warming.
The advance team was led by Fletcher and Wood. To their alarm, they learnt that the White House planned to limit the leaders’ public time together to a brief photo opportunity. There would be no joint news conference in the Rose Garden. Obama’s officials were against setting a precedent for giving a twosome to visiting leaders. The Downing Street officials frantically sought to persuade the Americans that this would be ‘a disaster’ for Brown.10 As new arrangements were hastily put together, British journalists were left at the gates of the White House, where they shivered in sub-zero temperatures and composed stories about how the Prime Minister had been frozen out.
The White House agreed to stage ‘a spray’ – a smaller, more informal news conference inside. Brown had been self-consciously stiff when he met with Bush, whom he addressed as ‘Mr President’, and recoiled from first-name terms. In contrast, he called his host ‘Barack’ when they sat in blue and yellow antique armchairs before a painting of George Washington. For all his attempts to look at ease, Brown was never adept at the fake bonhomie which is de rigueur for these encounters between leaders. ‘I don’t think I could compete with you at basketball,’ he said to the svelte American. ‘Maybe tennis.’ Obama smiled: ‘I hear you got a game.’ ‘I think you’d still be better,’ Brown gratuitously sucked up to the younger man.11
The Obama team, not yet properly staffed and with a hazy comprehension of all the protocols, made a hash of the ritual gift exchange which is supposed to betoken mutual esteem. Downing Street agonised thoughtfully for many weeks over what might be an appropriate present for the new President. ‘There was an enormous e-mail chain.’12 They settled on a penholder carved from the oak timbers of the HMS Gannet, a ship deployed to suppress the slave trade in the nineteenth century. Wood from its sister vessel, the HMS Resolute, was used to make the desk in the Oval Office. In return for that resonant and tasteful token, the White House presented Brown with what smelt like a panic buy: a boxed set of twenty-five American movies. The collection included Raging Bull, The Godfather and Gone With the Wind, all titles which might be loosely metaphorical of Gordon Brown’s political career and what the financial crisis had done to it. You could buy a box set of 100 Hollywood classics from Amazon for just $17.99. It was not so much the cheap price tag that was wounding to British pride; it was the evident lack of thought displayed by the Obama team. ‘When we’d been so careful, that looked so desperate,’ lamented one of Brown’s officials. ‘It looked like they’d found it in Wal-Mart.’13 For John and Fraser, the Browns’ young sons, Sarah was presented with toy models of Marine One which could be bought in the White House gift shop for less than ten bucks. Brown was ‘furious that most of the press were obsessed with “snubs” ’.14
He consoled himself that the private talks at the White House appeared to be productive. Obama was an instinctive internationalist and relatively multilateralist by the standards of American leaders. Brown’s principal aim was to recruit the President as an ally in order to make a success of the G20 Summit in London the following month. There had been an anxious wait before the Americans even made a firm commitment that Obama would attend the G20. Says Mark Malloch-Brown: ‘There was a real early problem about American engagement and it was a problem right up until Gordon Brown visited the US.’15
Leaders smell vulnerability on each other like sharks scent blood in the water and Labour’s dire position in the polls had not gone unnoticed in Washington. It became clear to the British team that the Oval Office was closely monitoring the Prime Minister’s political pulse. Rahm Emanuel, the White House Chief of Staff, and David Axelrod, the president’s senior political strategist, discussed with their British visitors how they had bounced back the previous autumn and why Brown had since slumped back into the valley of electoral death.16
To Brown’s relief, Obama treated him as a serious player. The two leaders found that they were ideologically simpatico and broadly on the same wavelength about the crisis. The American President had committed to a big stimulus for his economy. Indeed it made the British one seem slight by comparison. After their private tête-a-tête,
they were joined by their teams for a chicken salad lunch. Obama invited Brown to repeat for the edification of the table some of the observations about the economic crisis he’d made during their earlier one-to-one. Brown was duly flattered. When he was so unpopular at home, it was crucial to both his domestic authority and his international credibility that he was not treated as a lame duck by the White House. That mattered much more to him than the crappy gifts.
The speech to Congress the next day was well-received even if it struggled to make the front pages of much of the US press. Brown won early and easy applause when he punched predictable buttons by hailing America’s heroes and praising its genius for renewal. He had always been an enthusiast for the United States and took his summer holidays on Cape Cod for many years. That gave a ring of authenticity to his rhetoric when he declared: ‘America is not just the indispensable nation but the irrepressible nation.’ He won loud approbation when he argued that ‘wealth must help more than the wealthy, and riches must enrich not just some of our community, but all of our community.’ That line hit the spot with the Democrats, who controlled both houses of Congress. The Republicans sat on their hands when he called for a new global agreement on climate change. He did not repeat the frequent charge he made at home that the origins of the crisis lay in the United States. But he did try to challenge as well as flatter. Neither side of the aisle clapped when he warned that protectionism was ‘a race to the bottom’ which ‘in the end protects no-one’.17
They gave him nineteen standing ovations, the same tally clocked up by Blair in 2003. This was important not just for the satisfaction of his ego but also because Brown knew that the media was counting. His eagerness to be seen as Obama’s First Friend was an incentive to many journalists to search for any indications to the contrary. Some located them in the rubbishy gifts and the lack of a full-scale news conference at the White House. These were used to fashion raspberry-blowing headlines. One of Brown’s aides groaned: ‘They were determined to find a snub story and they got it.’18
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