Short Termism

Short-term profiteering is one explanation for the banking crisis. Who was among those who warned of the dangers of short-term economic and financial thinking? Gordon Brown, who has begun to resemble Richard Nixon in the way he is clinging to power because that's all there is left to cling to.

Twenty years ago, in two pieces he wrote for the LRB, Brown attacked Thatcher for promoting short-term gain at the expense of long-term investment and research. In fact, Brown equated the entire Thatcher project with short-term thinking, blind as he also believed it was to long-term growth. 'Despite its unquestionably open economy,' he wrote in 1990, 'Britain has nothing like the number of top-class industries that Germany or Japan enjoys. Our industries are widely spread but lack depth. We are weaker in machinery industries than Italy or Switzerland. Our infrastructures, once the envy of the world, are now a major hindrance.'

'Thatcherism has been immensely destructive,' Brown wrote a year earlier. 'Her market-obsessed solutions have made our problems worse.' In 1990, Brown didn't seem to believe that the legacy of Thatcher would be long-lasting, or that her policies couldn't be reversed: he seemed to think that Thatcherism would vanish just as soon as the Labour party was elected. 'When Thatcherism becomes a "wasm",' Brown wrote in 1989, 'everyone will wonder what all the fuss was about.' Which makes it all the stranger that Brown himself – first as chancellor, then as prime minister, in what looks set to be a very short term indeed – was so content to continue the Thatcherite project.

And where has Tony Blair been when Brown has most needed him? Absent. In January, he was in Washington to receive the Medal of Freedom conferred on him by George Bush. He then led a prayer breakfast at the Obama White House, where he talked of God's love 31 times and, more important, drew Obama's praise. He's been in the Middle East, testified before Congress, taught at Yale and presided over the Tony Blair Faith Foundation. God's love is one thing; Blair's love apparently another. Not that this is so surprising: the downfall of Brown suits Blair all too well. It will be Brown, not Blair, who will be remembered for bringing New Labour to its end.