Is this the week that Labour lost the next election?

[Albus]

http://www.guardian.co.uk/politics/2009/jan/31/labour-brown-g20-summit


Defeatism grips party ahead of April G20 summit as raft of polls show big Tory lead

A strange, funereal mood hung over the meeting of the parliamentary Labour party. It was not just that the Guardian/ICM poll had just put the Tories back into a 12-point lead or that Alistair Darling, the chancellor, used the gathering to give a typically unvarnished account of the state of the recession.

It was the appearance last Monday of Neil Kinnock, Michael Foot and Jack Jones, the former general secretary of the Transport and General Workers Union.

As one jaundiced Labour MP put it: "We had the party leader that had taken us to two election defeats, the party leader that gained the lowest share of the vote at an election since 1918 and the union leader that created the winter of discontent and 18 years of Tory rule. It was surreal given what was going on in the real world. Only Labour glories in its defeats."

And yet it was also strangely appropriate because a new defeatism has once again gripped Labour. All five polling organisations - ICM, ComRes, Ipsos MORI, YouGov and Populus - have now given the Tories double-digit leads. Most suggest the Tory resurgence has been at Labour's expense. Brown's second honeymoon last autumn in the wake of his first rescue of the banks has ended, leaving Downing Street deflated.

The prime minister's qualities as the leading analyst of the global recession, his great strong point in October, has started to resemble monotonous self-justification. The string of initiatives, some good, some bogus, leave voters confused, as billions get replaced by trillions. Darling's big initiative last Monday week - on insuring the bank's liabilities - went wrong as it was launched on the day Royal Bank of Scotland announced the biggest corporate loss in British history, leading to a wider collapse in bank shares; a fall that in turn looked like a negative verdict on Darling's initiative.

Cabinet ministers say that before Christmas they had been braced for the bad polls. "Given what we have seen on the TV news every night with bank shares diving and companies closing, people are becoming personally threatened," said one. "It is not a positive shift to Cameron."

Another cabinet minister, referring to the riots in Greece and the strikes in France, warned: "It is possible this was the canary in the mine for the rest of Europe. We could see social disclocation here if we do not get the tone of our response right."

That fear, and the slide in the polls, is prompting cabinet members to review tone, language and line.

The call this week by the backbencher Jon Cruddas for Brown to show the same "emotional intelligence" as Cameron is directly echoed inside the cabinet. But those that have known Brown longest insist he must stick to his strengths, even if his speeches are peppered with references to "deglobalisation and financial mercantilism". A cabinet member says: "There is plenty of 'mea culpa' from him in private, but in public he reverts to type, and that is not going to change now."

Another says: "I don't think it is 'mea culpa' we need. There is a legitimate issue of tone, and perhaps saying we all missed something - regulators, bankers, and politicians. It would also be wrong to present British bankers as innocent victims of an international conspiracy. You have to show where it came from and why. There was no early warning system to prevent it all getting out of hand. What would be criminal is if we did not learn the lessons and act on them.

"It is going to be a long haul, but you do have to have a sense of direction. There is a thin line between making sure you are ahead of the curve, making things happen and then the appearance of frenetic activity.

"We are trying to have conversations with markets, the public, policymakers and commentators all at the same time.

"It is bloody complicated stuff. The markets are very nervous and remain nervous and lose confidence if you are inactive, but they also want to know what you are doing is affordable."

One minister likened the process to walking across a frozen lake and hoping the ice is of uniform consistency and thickness.

"If it is not, you fall in and there is no way back. We just need to keep reminding people of what we have done, demonstrate that we are doing it carefully and competently."

Some ministers are privately pressing for a belated, more populist attack on the bankers.

Brown himself has spoken of an age of irresponsibility. But for such a moral man, his language has been temperate, focusing instead on solutions rather than a reckoning with bankers.

Yet the danger with such constraint is that it leaves the stage free for Cameron to attack, as he did yesterday at Davos, "markets without morality and capitalism without a conscience", rhetoric that another conservative, the French president Nicolas Sarkozy, has also been more willing to deploy.

The nightmare for frustrated Labour MPs is that it is going to get a lot worse and, as the IMF predicted this week, there is little to no chance of pointing to any clear signs of recovery before a 2010 election. Darling's spring budget will lead to another downgrading of the public finances in comparison with the forecasts in the November pre-budget report.

But Brown still has one big card to play - his chairmanship of the G20 summit on 2 April, an event that is consuming Whitehall's best minds. The G20 will give Brown a chance to stand alongside President Obama and stress his status as the leading architect of the fiscal stimulus.

A minister admits: "Gordon is completely on top of all this but we badly need to internationalise things. We are not quite treading water, but in a hiatus, waiting for Obama."

The biggest danger for Brown would be a slow corrosion of his political authority.

There would be no challenge to his leadership, but instead an increasingly obvious jockeying for the Brown succession after an election defeat.

That would be fatal, and leave Brown quickly joining the pantheon of Foot and Kinnock.