Monday, 11 January 2010

David Cameron versus Gordon Brown - no contest?

David Cameron versus Gordon Brown - no contest?

A four-hour family luncheon to mark my wife's 70th birthday brought forth discussions that included memories of 'the good old days' and also touched upon current affairs.

Almost inevitably - because I am a likely independent candidate for South East Cambridgeshire at this year's election - 'current affairs' elicited the expected question, 'What do you think about David Cameron versus Gordon Brown?'

My off-the-cuff response was, 'Well, David Cameron is undoubtedly a nice person - though it's a pity that one of his reported 'recreations' is deer stalking - but he is all charm and no substance, whereas Gordon Brown appears to have no charm but is a man of substance.'

All of my blood relatives and all of my in-laws are nothing if not outspoken and one of my best-loved brothers-in-law rose from his seat at this point, glared at me and almost immediately left the room. (It seems that he had wanted to go to the loo, but I wasn't to know this, and I was concerned that I had gone too far for this Daily Telegraph-reading gentleman who has had a lifetime's experience of, and involvement, in big business and what is sometimes termed 'high finance'). Before leaving the room, Mr *** said that he could never forgive Gordon Brown for a number of misdeeds, most notably his altering of the regulatory regime of the banks and other financial institutions and his 'getting us in this mess.' The latter might not have been the exact words used by Mr *** but the drift of his accusations was abundantly apparent: he thought Brown a fool and a disaster.

Somewhat diffidently, for I like to be fair and I like to give credit where credit is due, though I don't enjoy annoying close relatives and potential political supporters, I said, in regard to Brown's alleged foolishness, that, with the benefit of hindsight, the then Chancellor of the Exchequer was undoubtedly unwise to have ordered and to have achieved the sale of a substantial proportion of the Bank of England's gold reserves at an average price of $275 per ounce. Of course, I said, at the time of the sale, several other governments or central banks had resolved to do the same, it then being fashionable to deride gold as a store of value and to regard fiat currencies (paper money 'guaranteed' as to continuing value by governments) as the shining light of the future. We have all learned otherwise since and gold is now valued at $1,150 per ounce and the £ sterling has dropped again in relation to the Euro (though this may not be unhelpful to the British economy).

I also thought (but may not have said) something to the effect that all regulatory regimes are alright if the regulators know what they are doing. Mr *** emphasised his point by saying that the 'old boy network' of the City of London knows a lot: I don't doubt this. But what I did point out was that we were all talking - again - with the benefit of hindsight. Moreover, I said, the financial crisis that very nearly caused the collapse of banks and of capitalism itself started in the United States where, following the panic that followed '9/11,' Mr Alan Greenspan, the then venerable and venerated Chairman of the Federal Reserve, dramatically reduced interest rates and expanded the American money supply by providing 'liquidity' to the U.S. economy on an almost unprecedented scale. This, inevitably, together with a loosening of lending regulations in America, led to a quick economic recovery from what was a severe psychological shock to the Americans but it also led to 'NINJA' (No Income, No Job, No Assets) loans to many who would discover in any downturn in property values that their loans were bigger than they could handle, or that the lending banks could handle. Something similar happened here, too, but not on such a dramatic scale.

In further defence of Gordon Brown, I asserted that, whilst the worldwide crisis undoubtedly started on its trail of destruction in the U.S., our Prime Minister had actually instigated and ordered extraordinary counter-measures, most or all of which were opposed by Her Majesty's loyal opposition. I mentioned, though it is relatively minor in the larger industrial and financial arena, the car scrappage scheme, which the Conservatives opposed but which has worked and has probably been the salvation of the UK-based motor car industry. The boiler scrappage scheme may be similarly beneficial. Brown acted, rightly or wrongly, but at least he acted, and the Conservatives advocated doing nothing.

Of course, the jury is still out on both Brown and Cameron, but it ain't over yet. And it won't be over even after the 6th of May, whoever wins the election and enters or re-enters 10 Downing Street.

I look forward to further discussions with Mr ***, who, I reminded him, was as fortunate as I am to have married into a grand old family - that of my 70-year-old missus.

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