Gordon Brown: Prime Minister

In the early days of the election campaign at the end of May 1987, Brown and his party leaders were nevertheless optimistic. Mandelson’s coup of a glossy election broadcast by Hugh Hudson of Neil Kinnock and his wife walking hand-in-hand in visually stunning photography roused the party’s spirits. Kinnock’s popularity rose sixteen points overnight. The reports from Conservative Central Office of arguments among Tory leaders gratified Labour’s planners, convinced of their strength on health and education. Labour’s undoing started in the last week of the campaign. In a television interview, Kinnock was asked what would happen if Russia invaded Britain, unprotected by a nuclear bomb. He replied that guerrilla bands fighting from the hills would resist the invader. That strategy found few sympathisers in the Midland conurbations, London and the south-east. Portrayed as a leftist loony, Kinnock was also vulnerable on taxation. Roy Hattersley and John Smith had pledged to reverse privatisation and restore most social benefits. The cost of that, the Tories claimed, would increase income tax to 56 pence in the pound. At first Kinnock insisted that only those earning over £25,000 a year would face higher taxes, but under persistent questioning he admitted that those earning over £15,000 would pay ‘a few extra pence’. The newspaper headlines ‘Labour Tax Fiasco’ frightened the middle classes. Thatcher’s accusation that with Labour ‘financial prudence goes out of the window’ struck a mortal blow.

Campaigning in Scotland, Brown was distanced from these misfortunes. The swing to Labour in his area suggested that there would be a rout of Tory seats. He did not believe the national opinion polls, and was heartened on election night by a BBC Newsnight exit poll predicting huge Tory losses and a ‘hung’ parliament. His smile disappeared long before his personal result came in. The Tories lost in Scotland but would be returned with an overall 101-seat majority. Brown won his seat with an increased majority of 19,589, practically 50 per cent of the votes cast. His personal pleasure was suffocated by the national result. ‘He was shaken by the defeat,’ reported a close friend the next morning. ‘He thought Labour would win nationally as it had in Scotland.’ Ten years later, Brown would claim to Paul Routledge that at the time of the 1987 election he had blamed Labour’s plans for high taxation for having ‘put a cap (#litres_trial_promo) on people’s aspirations’. In reality he appears not to have contemplated lower taxation until long afterwards.

In the autopsy of the defeat, the dissatisfaction with the party’s deputy leader Roy Hattersley was widespread. John Smith, popular, funny and fast at the dispatch box with a joke or a mocking aside, was expected to inherit the shadow chancellorship despite his poor grasp of economics. He encouraged Brown to stand for election to the shadow cabinet, impressed by the young man’s loyalty, hard work and use of leaked documents to discomfort the government. Brown was pleasantly unintoxicated by his status, arriving at meetings like an overgrown student with bundles of ragged papers spilling onto the floor. He was also noticeably devoid of the argumentative stubbornness that would emerge later. Smith’s endorsement was critical to Brown’s campaign in the election. Helped by Nick Brown, a northern England trade union officer also elected to parliament in 1983, he came eleventh out of forty runners, an unexpected success. John Smith was duly appointed shadow chancellor and Brown shadow chief secretary to the Treasury, the youngest member of Neil Kinnock’s new team. ‘He’s going to be the leader of the Labour Party one day,’ Kinnock told Tom Sawyer, a member of the party’s National Executive Committee. Kinnock regarded Brown as a kindred spirit against John Smith, of whom he was wary, although he judged both Scots to be reliable. The Scottish MPs were a group of experienced politicians, held together despite personal differences by a tribal brotherhood based upon ability. United by their hatred of Thatcher and not scarred by Militant, their principal shortcoming was provincialism. Everything was interpreted from a Scottish point of view, and as a result their contribution to the inquest into the causes of the unexpected election defeat was muddled.

Kinnock ordered a review of the party’s whole ideology. Labour, he acknowledged, was unelectable without the support of the middle classes. The review of the economic policies was entrusted to Bryan Gould, a New Zealander and the shadow spokesman for trade and industry. Gould, an organiser of the recent election campaign and a member of Labour’s left wing, believed that traditional socialism remained the party’s anchor. Brown no longer agreed, and refused to participate in Gould’s work. His unease had emerged after forensic discussions about the party’s policies with Doug Henderson, John Smith and Murray Elder – all Scotsmen who would spend one week every August hill-walking and mountaineering in Scotland with their families. ‘Brown wanted a break from the past,’ reflected Gould sourly. ‘His idea was to be more congenial towards the City.’ Gould, more senior than Brown, was unwilling to accommodate Brown’s ill-defined opinions, and was encouraged to pursue his course by Peter Mandelson, whose patronage had promoted Gould’s importance in the media. ‘Peter gave me a very comforting feeling,’ Gould acknowledged, ‘introducing good contacts and placing my name in very good contexts.’

The stock market crash on 19 October 1987, ‘Black Monday’, confirmed Gould’s conviction about ‘capitalism’s irreversible crisis’. Ideologically, Brown could offer no solution to Labour’s unpopularity in the polls or suggest an alternative to Thatcherism, apart from announcing that Gould’s intention to re-impose economic controls would guarantee electoral disaster. ‘Bryan’s being unhelpful,’ Brown was told some weeks later by John Eatwell. ‘His report to the party conference will recommend the renationalisation of some privatised companies.’ Brown agreed that Gould’s proposals, the springboard for his ambitions to be party leader, were reckless. He combined with Blair to urge Mandelson to abandon Gould. While Mandelson pondered, Brown and Blair took it upon themselves to frustrate the review.

Busy preparing to dispatch his final report later that day to the printers, Bryan Gould was surprised when Gordon Brown, Tony Blair and John Eatwell entered his office in the Norman Shaw building unannounced. ‘We want all references to nationalisation and renationalisation taken out of the report,’ announced Brown. ‘You’re too late,’ replied Gould angrily. ‘You refused to sit on the committee and do any work, and now you want to interfere. No way. Go away! All of you!’ Gould stared particularly at Blair. His presence was inexplicable, since he, as shadow spokesman for employment, was not even eligible for membership of the committee. The report was dispatched and printed. Gould’s victory, however, was bittersweet. At the end of 1987 a series of unfavourable references to him appeared in newspapers. He suspected that he knew the identity of the source, but his repeated attempts to reach Peter Mandelson were unsuccessful. Eventually he elicited an unexpected response. ‘You should get to know Gordon,’ said Mandelson. ‘He wants to be a friend of yours.’ Gould realised that he was being abandoned. Mandelson’s seduction – the offer of friendship, with its concomitant demand for emotional commitment – had been aborted. Even worse, Mandelson had switched. He was now briefing against Gould and promoting Brown and Blair. ‘It’s an ideological war,’ Gould realised, but was nevertheless relieved when his report, ‘The Productive and Competitive Economy’, was approved by the party executive on 25 May 1988. Unintentionally, he had prompted the conception of an emotional, triangular relationship between Mandelson, Brown and Blair.

Peter Mandelson had become persuaded that Gordon Brown was the party’s future. Compared with so many Labour politicians, Brown was immensely attractive. Unaware of his lurking volcanic aloofness, Mandelson regarded Brown as a sensitive, handsome, entertaining professional tainted only by impatience and intensity. Among other MPs he was regarded as unselfish, willing to help those in difficulty, extending personal kindnesses even to those with whom he disagreed if they had won his respect as an intellectual equal, and arguing from knowledge rather than purely prejudice. Watching him at receptions, as he glad-handed and back-slapped the faithful with apparent conviction, and without betraying his dislike of the performance, few would have recognised the brooding workaholic who invariably arrived late at a restaurant for dinner with friends and, after gobbling down his steak and chips or a plate of spaghetti, would rush back to his rooms to either type a speech or read a book.

Brown’s combination of intellect, sophistication, ambition and popularism appealed to Mandelson. Standing on the steps of the party’s headquarters in Walworth Road, he told Andy McSmith, a Labour press officer, ‘Gordon will one day be the party’s leader.’ Mandelson’s prediction surprised McSmith. Brown was still largely unknown. Mandelson acknowledged that obstacle, but had repeatedly promised Brown that it would be overcome. During their frequent meetings Brown constantly complained, ‘I’m not getting enough mention in the papers. My name’s only in a couple of them.’ Mandelson reassured him that his hard work would be rewarded. Both were grappling with the party’s ideology, and belatedly welcomed the opportunities of the 1987 defeat. With the support of the party’s left wing and the endorsement of Neil Kinnock, Brown believed he would eventually succeed the Welshman as the party’s leader. He dismissed the chances of his rivals, except possibly John Smith, who was handicapped by his poor relationship with Kinnock. Brown’s quandary was how to develop an alternative to Thatcherism. Marooned among orthodox Scottish socialists, he was still estranged from the consequences of ‘Big Bang’.

Nigel Lawson’s boom had visible fault-lines, but Thatcherism appeared irreversible. Relying on people and markets rather than Whitehall civil servants to manage the economy was attractive to electors. Mandelson, alert to the new ideas, understood the dilemma. ‘I think you should go to Gordon,’ he told Michael Wills, a television producer at LWT’s Weekend World who drafted policy documents and speeches for him. ‘Help him become prime minister.’

Interested in the failings of British industry, Wills had just completed a series of documentaries revealing the limitations and frustrations of British managers. In particular he had been struck by an interview with a supplier of car components who volunteered that he had resisted borrowing money from the banks in order to build a new production line to manufacture gearboxes for Honda. His reason was depressing. In the early 1980s he had borrowed for a similar venture, but interest rates had soared and he had been financially crippled. Ever since, he had decided to remain small and safe by not borrowing. He spoke eloquently and authoritatively about the Conservative government’s failure to help industry. This was fertile ground for Labour to exploit, Wills told Brown. Wills introduced Brown to the experts consulted by Weekend World, with whom he discussed the essence of Thatcherism and its American counterpart, Reaganism. Reluctantly, he began to recognise the strength of some Tory policies and the disadvantage of Labour’s adherence to Attlee’s consensus. There was reason to acknowledge that the growth of Europe’s and America’s successful economies was not the result of state intervention. Listening and brooding, he agonised over how to balance incentives to entrepreneurs, the restriction of public spending and the financing of social justice. ‘We need a fairer Britain,’ he repeated as he learnt to sympathise with the market economy. ‘We’ve got to work from first principles towards policies,’ he told his confidants, irritated by Kinnock’s ignorance of economics and John Smith’s resistance to change. Under Smith as shadow chancellor, Labour’s economic policies remained rigidly anti-market, against joining the ERM and in favour of controlling exchange rates. ‘We must persuade the rich of the need for fairness,’ Smith had said, apparently without realising the inherent contradiction. Wealth creators, by definition, are not social philanthropists, but ruthlessly ambitious to earn money for themselves.

Three successive election defeats had convinced Brown that simply damning the Tories’ sympathy for the rich would not reverse Labour’s political decline. The party needed new ideas. That summer he spent three weeks in Harvard’s library, studying industrial policy and discussing the cause of America’s economic success with local academics. He returned to Westminster emboldened by his intellectual rejuvenation. His task was to find a compromise between old Labour’s philosophies and Thatcherism. There were many false starts. Essentially, he was searching for ideas to help him write a new Labour epic that could rank with Anthony Crosland’s Future of Socialism, a 500-page analysis of how to create an egalitarian, socialist Britain, published in 1956. Throughout, Brown asserted with evangelical sincerity that social Christianity could provide greater fairness and prosperity through a more efficient economy, all in the cause of socialism.

Nigel Lawson’s budget in 1988 was another ideological challenge. Treasury statistics showed that the reduction in the top rate of tax – from 83 per cent under Labour in 1979 to 60 per cent nine years later – had actually increased the amount of money received by the Treasury, as the rich had less reason to evade and avoid taxes. In his penultimate budget, Lawson announced that the top rate of tax would be reduced from 60 per cent to 40 per cent, and the basic rate cut to 25 per cent from 33 per cent. The Labour benches erupted in uncontrolled protest. The Commons was suspended for ten minutes. Brown joined in the protest. He rejected Lawson’s argument that encouraging enterprise would benefit the poor. Too many millionaires, he raged, were enriching themselves from tax loopholes, not least from share options. Lawson’s budget allowed company directors to buy shares at 1984 prices and take the profits in 1988, paying capital gains tax of 30 per cent rather than 60 per cent. ‘Britain is fast (#litres_trial_promo) becoming a paradise for top-rate tax dodgers,’ Brown protested, demanding that the ‘share option millionaires (#litres_trial_promo)’ should be penalised. Instead of rewarding the rich, the government should invest in education and training. Brown was echoing the mantra voiced by Harold Wilson twenty years earlier, although six years of Wilson’s government had ended, at best, in economic paralysis. His unoriginal accusations did not dent Lawson’s claim to have achieved a hat trick – higher spending on public services, lower tax rates and a budget surplus.

Overshadowing Lawson’s self-congratulation was the rising value of sterling and his bitter row with Thatcher about whether Britain should join the Exchange Rate Mechanism (ERM). The growing strain between Lawson and Thatcher, and the prospect of rising inflation and an implosion of the boom, encouraged Brown’s belief that the government’s economic policy was doomed. Neil Kinnock’s misfortune was that his alternative policies were unattractive to Labour’s far left. Their representative, Tony Benn, launched a bid for the leadership, and the old internecine war erupted once again. Benn’s bid was trounced at the 1988 autumn party conference in Blackpool, but all the percentage points gained from the Tories shown by the opinion polls evaporated. Labour remained a party of protest, and not an alternative government.

At the end of the party conference Brown returned to Edinburgh with John Smith. Over the previous week the shadow chancellor had as usual enjoyed himself, living up to his reputation at many parties as a heavy drinker, and smoking cigars after big meals. On reaching home he felt unwell, and was examined in a hospital. While getting dressed afterwards, he suffered a heart attack. Smith’s misfortune was Brown’s opportunity. For twenty years he had prepared himself for the spotlight, and now his chance had arisen at the most favourable moment as, during Smith’s convalescence, he took his place on Labour’s front bench. Nigel Lawson’s strategy appeared to be crumbling. The Tories were becoming the victims of their own mistakes. There were widespread protests in Scotland against the new poll tax, inflation was climbing above 4 per cent, interest rates were rising towards 14 per cent, unemployment was stuck at three million and, with a worsening balance of payments, there was a run on sterling. Lawson’s boast about his ‘sound management of the economy’ was an easy target.

‘This is a boom based on credit,’ mocked Brown, eager to prove his skills during the debate on the autumn financial statement on 1 November 1988. Standing at the dispatch box in a crowded chamber, glancing at a speech printed out in huge letters to compensate for his poor eyesight, Brown relished the occasion. Countless speeches in dank Scottish assembly halls had primed his self-confident, exquisitely timed flourishes, mixing statistics and oratory while displaying his mastery of the dialectic, the rapier of eloquent Marxists. He deployed artful mockery to rile an arrogant chancellor for allowing consumption to spiral out of control and for making consistently wrong forecasts. ‘Most of us would say,’ scoffed Brown at his crestfallen target, ‘that the proper answer is to keep the forecasts and discard the chancellor.’ Each cutting jibe, accompanied by whoops of derision from the Labour benches, rattled Lawson’s pomposity. The chancellor had not anticipated the humiliation or the lukewarm support from the Tory benches. His pained expression was Brown’s reward. The result, Brown would later say, was ‘an unequal dialogue between a chancellor who had not yet made up his mind when to retire and a prime minister who had not yet made up her mind when to sack him’. During those magical minutes, Labour MPs felt a surge of hope. Here, perhaps, was the new hero they had sought so desperately. Brown sat down to roars of approval.

Walking through the (#litres_trial_promo) arched corridors of Westminster later that afternoon, he was suitably modest, feeling an inner calm about his good fortune. In just two days, Labour MPs would vote for the shadow cabinet. The combination of his Commons performance with his astute handling of a series of leaks had earned him an irreproachable reputation. Once again, he sought the help of Nick Brown to lobby for votes. The result, late on 6 November, was electrifying. As he rushed from Committee Room 14, Brown was laughing. He was top of the poll. Following him out of the room, Tony Blair was seen telephoning his wife Cherie to report his own first appearance on the list, his reward for humiliating Lord Young, the secretary of state for trade and industry, about the government’s misconduct of supervising Barlow Clowes, an investment company which collapsed as a result of dishonesty. The next morning’s newspapers praised Brown as ‘high flying’ and ‘a horse for early investment’. One sage wrote, ‘He appears to possess the ultimate political quality of luck.’ A few, aggressively (#litres_trial_promo) briefed by Mandelson, speculated that Brown had become a future contender for the party’s leadership. Willie Whitelaw, the Tory elder statesman and former home secretary, said that both Brown and Blair were ‘improved and becoming (#litres_trial_promo) a little dangerous’. Another observer noted that even at that moment Brown appeared affected by self-doubt: ‘He is very ambitious, but he seems to lack the nerve to go right to the very top.’ Brown’s image among the agnostics was not of a leader but of the Scottish engineer on the ocean liner, toiling away below decks in the engine room, polishing the pistons and removing the grease.

An opportunity to shed that reputation was again provided by Lawson. After journalists briefed by the chancellor reported that he intended to target the poor and pensioners with benefits while withholding the money from the rich, Lawson complained that he had been misquoted. The furore allowed Brown to parade his Christian conscience. ‘The government’s real (#litres_trial_promo) objective,’ he taunted the tarnished chancellor in the Commons, ‘is to move from a regime of universal benefits to a regime of universal means testing, jeopardising for millions of pensioners security in ill-health and dignity in old age.’ Means testing pensions, said Brown, was ‘the most serious (#litres_trial_promo) government assault so far mounted on the basic principles of Britain’s postwar welfare state’. His reputation harmed by scathing headlines whose implication – ‘Veteran Chancellor Bloodied by Upstart’ – was clear, Lawson’s misfortunes resulted in rich kudos for Brown. The Commons was the perfect platform from which to parade his loathing for complacent Tories feigning to help the poor. They were men, he sniped, who cared for power and money rather than principle. Lawson and Nicholas Ridley, the secretary of state for the environment and High Thatcherite minor aristocrat, ranked among the worst. Ridley’s aspiration was to deregulate, to withdraw subsidies, and to delight in not pulling the levers of power. Ridley sneered at Brown’s ‘supply-side socialism’. Standing in the crowded chamber, Brown reacted with genuine anger to the chain-smoking minister who appeared to care more about his ashtray than his departmental in-tray. Above all, Brown reviled Thatcher’s affection for photo-opportunities: one day she was seen promoting science, the next day campaigning against litter, then advancing the cause of women and later urging the regeneration of the inner cities. ‘Today a photo-opportunity,’ he wrote, ridiculing the ‘Maggie Acts’ headlines, ‘tomorrow a new issue, the last one all but forgotten. The government’s main new investment in these vital concerns has been in its own publicity.’ His incandescence at (#litres_trial_promo) the rising cost of official advertising, from £20 million to £100 million, seemed genuine. Four years later he would adopt the same tactics as virtuous ploys to help win an election.

Brown’s pertinent strength in 1988 was his patent sincerity. Like a machine-gun, around the clock, seven days a week, he worked to capture the headlines, firing off press releases on every subject, with newsworthy coups offering leaks of confidential Whitehall information. One day he (#litres_trial_promo) publicised a government memorandum about civil servants not encouraging grants for high-technology research; another day he (#litres_trial_promo) produced secret government statistics showing that the poorest four million homes were worse off than they had been ten years earlier; another day he trumpeted a (#litres_trial_promo) report by Peter Levene, the personal adviser to Michael Heseltine at the ministry of defence, recommending that, to save money, Royal Navy ships should be refitted by private contractors. Levene’s discovery that the efficiency of the naval dockyards could not be assessed because their accounting systems were ‘entirely meaningless’ was derided by Brown’s assertion, to cheers, that ‘this is the (#litres_trial_promo) most devious government we’ve had this century’.

Success fuelled his passion: at 7.30 on Boxing Day morning he telephoned Alistair Darling, a lawyer and Scottish activist educated at Loretto, a private school outside Edinburgh. ‘Have you seen the story in today’s Daily Telegraph?’ he asked. ‘No,’ replied Darling. ‘I’m still asleep.’ Deprived of a personal family life, Brown had become preoccupied by politics. Gradually, his passion distorted his perspective on life. Some accused him of hyperactivity, of becoming over-exposed as a rent-a-quote politician, robotically spouting One True Faith. He confessed his awareness that ‘rising can turn (#litres_trial_promo) into falling pretty quickly’, and blamed his irrepressible desire to lead Labour away from its past and towards new policies. His fervour would brook no opposition, especially from other members of his party.

Among the most difficult were his fellow Scots. His old foe George Galloway and John Reid, previously a sociable partner, had become argumentative and occasionally unreasonable. Reid and his group, Brown suspected, were quintessentially sectarian west Scotland left-wing hardmen, meeting as a caucus before general meetings to agree their arguments and votes. ‘He’s a music hall artist,’ Brown said of one agitator whom he castigated as ‘a prisoner of his upbringing’, perhaps failing to recognise that he too was a hostage to his own past.

Among the shackles of that past was the feud with Robin Cook. ‘It’s chemical between those two,’ John Smith told friends, concerned about the sour relationship. Cook was himself renowned as a good hater and not a team player. ‘A bombastic pain when I first met him,’ was Jimmy Allison’s judgement about a man accused of flip-flopping on major policies – the euro, nuclear weapons and Britain’s relationship with the United States. While Cook spoke impromptu on those issues, alternating between vehement opposition and support, Brown avoided extremes, courteously delivering written speeches based upon intellectual reasoning, only rarely being wrong-footed. His success increased Cook’s tetchiness. In turn, Brown became convinced that Cook, as he told friends, was ‘trying to destroy me’. No one regarded this apparent paranoia as serious, but there was a less attractive personality beginning to emerge. Success and publicity had transformed Brown into a man with an unqualified belief in himself, convinced that he was the best socialist, the best thinker, the best persuader, the best media performer and the best at everything else. The political truth was gradually defined as what suited Gordon Brown at that moment, and socialism was defined as those ideas that best served his interests. If his black-and-white judgement about Cook was challenged, a grim mood enveloped a man now increasingly consumed by hatreds. Only occasionally could he restrain his monochrome ambition.

To help John Smith’s recovery, Brown accompanied him in regular ascents of Scotland’s mountains over 3,000 feet in height – known as Munro-bagging – occasionally with Chris Smith, the MP for Islington, and Martin O’Neill. Those walks inspired Brown to write a pamphlet, ‘Where is the Greed?: Margaret Thatcher and the Betrayal of Britain’s Future’. At heart, the pamphlet revealed an old-fashioned Christian socialist concerned to alleviate suffering, seeking a modern way to vent his spleen against the Thatcherite conviction that state interference was a principal cause of society’s faults. Only the state, he claimed, could redress the growth of poverty and inequality since 1979. Eager to win the next election, the ‘new realist’ despaired about the past decade of Labour history and the danger of following John Maxton into oblivion. His solution, using new words to promote old ideas, was a rehashed attack on ‘free market dogma’.

John Smith sympathised (#litres_trial_promo), but was alarmed by his friend’s hyperactivity. During his convalescence he regularly telephoned Roy Hattersley, the deputy leader, and asked, ‘What’s Gordon up to?’ ‘Nothing,’ replied Hattersley, ‘but being loyal.’ To certify his reassurance, Hattersley invited Brown to lunch the week before Smith’s return. ‘What job would you like to do?’ he asked. ‘I think I’ll remain as shadow chief secretary,’ replied Brown, ‘to help John back to health.’ Brown’s restlessness for change and personal success did not appear to endanger Smith.

In early summer 1989, Margaret Thatcher became personally vulnerable. The poll tax had provoked violent protests, and her antagonism towards the ERM was dividing her from Nigel Lawson and Geoffrey Howe, the foreign secretary. To reinforce her position, Howe was demoted to leader of the House and Sir Alan Walters, an enemy of Lawson, was recalled as her personal economic adviser, based in 10 Downing Street. Lawson was incandescent. The disarray among the Tory leadership was oxygen for an accomplished political debater blessed with sharp wit, and Brown deployed his invective in a masterful Commons performance. ‘Many lonely, sad and embattled people,’ he said, mocking Lawson across the dispatch box, ‘labour under the delusion that their thoughts are being influenced by the Moonies next door … I assure the right honourable gentleman that he is not paranoid. They really are out to get him.’ Lawson sat stony-faced as Labour MPs jeered, ‘Go on, smile,’ and roared their approval as Brown recited the wretched statistics about inflation at 6 per cent, interest rates at 15 per cent and a growing trade deficit which undermined the chancellor’s reputation. No Labour politician wanted to hear that unemployment had fallen to 1.7 million and that manufacturing output had increased every year between 1983 to 1989 by an average of 4.75 per cent. Brown feigned deafness to Lawson’s assertion that Britain’s managers had finally been liberated to earn profits because of real competition, the destruction of protectionism and the strangulation of the trade unions’ restrictive practices. Devotion to socialism, retorted Lawson, was restricted to Albania, Cuba and Walworth Road. Not so, replied Brown spurred on by a party cheered by their discovery of a potential leader; there was socialism in Sweden, France and Spain. And soon, they hoped, in Britain. Lawson’s misery fuelled his opponent’s morale. As the chamber emptied, the crowd followed Brown and John Smith to the Commons bar. Endless hands smacked the dark-suited back of the man who fellow MPs were convinced was the star of the new generation, the future leader who would expunge the miserable memories of Wilson, Callaghan and Foot.

That evening, Brown was congratulated by Neil Kinnock. Confirming Brown’s potential to inherit the leadership, the Welshman offered two pieces of advice: ‘For credibility, you need to vote against the whip. And secondly, you’ve got to learn to fall in love faster and get married.’ Brown laughed. He had introduced Kinnock to Marion Caldwell, but had no intention of proposing marriage, despite her fervour. ‘Oh, there’s lots of time for that,’ he replied. Kinnock’s advice may not have been followed, but an unlikely source would possibly be more influential.

Just before the summer recess, Brown was travelling with Michael Howard, the secretary of state for employment, on a train from Swansea to London. Howard recognised Brown as a fellow intellectual. Flushed by the Conservatives’ continuing supremacy despite their difficulties, Howard settled back in his seat and presented a detailed critique of Labour’s unresolved electoral weaknesses. The party, he said, would never win another election until it ceased alienating the ‘margins’. Brown listened silently as Howard lectured him about appealing to voters’ personal interests in taxation, schools and health. To overcome middle-class antagonism, concluded Howard, Labour needed to address the details of those individual issues rather than blankly preach socialism. On arrival in London, the opponents bade each other farewell. In later years Howard would wonder whether his free advice had helped Labour finally to defeat his own party.

Brown was certainly anxious to learn during that summer. Americans had become his inspiration. The previous year he had met Bill Clinton in Baden-Baden, in Germany. Clinton was touring the world to meet other politicians before declaring his bid for the presidency. His big idea to roll back ‘Reaganomics’, with its greed and debts, was to introduce a ‘New Covenant’, reasserting the existence of a ‘society’ in America and declaring that citizenship involved responsibilities as well as rights. Brown found Clinton engaging, although intellectually muddled. There was nevertheless (#litres_trial_promo) scope for a partnership between Clinton’s advisers and Labour’s ‘modernisers’, including Peter Mandelson and Geoff Mulgan, a policy adviser. One year later, Brown would spend the summer in Cape Cod, reading through a suitcase of books on which the airline had levied an excess weight charge, and seeking out Democrats to hear about their new ideas.

He returned to Westminster anticipating excitement, but not the earthquake of 26 October 1989. Margaret Thatcher’s refusal to join the ERM and her protection of Alan Walters had humiliated Nigel Lawson. Insensitive to the danger, she allowed Lawson to resign, and then dismissed Walters. The prime minister’s relationship with Walters was an easy target for Brown’s derision: ‘It was the most damaging appointment of an adviser by a head of government since – I was going to say, since Caligula’s horse, but at least the horse stayed in Rome and worked full-time.’ Turning to the choice of John Major to replace Lawson as chancellor, Brown jeered, to the unrestrained acclaim of the Labour backbenches, ‘He has had the right training for the job over the past few weeks when he was foreign secretary – private humiliation, public repudiation and instant promotion.’ In the shadow cabinet elections in autumn 1989 he again topped the poll, and was appointed shadow spokesman for trade and industry.

For the modernisers, especially Blair and Mandelson, Brown embodied their best hopes for Labour’s eventual success. Suggestions that he was a candidate for the leadership inevitably roused his personal enemies and political critics on the left to question the essence of the man. The sceptics sensed a lack of ruthlessness, judged his charm as weakness, and doubted his willingness to grasp the jugular in order to advance his cause. Perhaps, they speculated, he lacked a game plan eventually to win the leadership. Their doubts were reinforced by Brown’s notorious disorganisation, persistently arriving late for, or completely missing, meetings. He was known to be irked by the practical details of life. Frequently he arranged a meeting in a restaurant but forgot to book a table, or even found the doors locked. His sometimes uneasy relationship to reality led to gossip concerning his uncertain commitment to others. His obsessive privacy, suggesting a fear of embarrassing revelations, also fuelled rumours, while his provincial rough edges suggested foreignness to the metropolitan media. ‘I think most (#litres_trial_promo) Scots are pretty reserved about their ambitions or personal lives. I think I am,’ he told an interviewer in 1989 who asked why he so rarely smiled. His friendship with Nigel Griffiths, a confirmed bachelor and the MP for Edinburgh South since 1987 who worked devotedly for him, excited unjustified gossip, not least after Owen Dudley Edwards said the two were like ‘Christopher Robin and Pooh Bear in an enchanted place in the forest’.

Outside Edinburgh, few were aware of ‘Dramcarling’, Brown’s new double-fronted red-brick house in North Queensferry, set on a hill above the road with a garden rolling down towards the Firth of Forth and with a view of Edinburgh Castle on a clear day. He had after many years found his dream. The house epitomised his love of Scotland – its poetry and scenery. The interior reflected another trait, having been neither redecorated nor refurnished. The dirty sofas from the shambolic top floor of his Edwardian house in Marchmont Road were dropped into the rooms overlooking the garden, and a familiar pile of books, government reports and newspapers began accumulating across the floors, around the battered typewriters and discarded word processors, towards the ramshackle kitchen. The man without taste hated domesticity.

During the decade Brown knew Marion Caldwell, his attitude towards women and relationships aroused bewilderment. Although he spent holidays with Caldwell in America, she remained in her own home in Edinburgh. He regularly disappeared for substantial periods, arriving at her doorstep when it suited him and failing to excuse himself if he was absent. Relationships with women in Brown’s life tended to be one-way affairs. Nurturing them was unimportant; affection was only perfunctorily acknowledged and reciprocated. Caldwell was among those women who were fascinated by his magnetism – the Alpha Male – and who pandered to his demand for immediate attention whenever requested. He happily allowed her to develop her career in Scotland. She was welcomed to the North Queensferry house at weekends, to sit quietly while he wrote endless articles, speeches and pamphlets. On Saturday nights he often refused to go out, preferring to watch Match of the Day. He expected Caldwell demurely to enjoy his pleasures, grateful that she was unable to visit London during the week. Sharing a flat in Kennington with his brother Andrew, he liked partying among high-achieving Scots in London. Although some have described a blissful romance with Caldwell in Scotland, Brown was interested in other women in the south. Some witnessed him pursuing Maya Even, a pretty Canadian presenter of the BBC’s Money Programme, while others recall him considering forging a relationship with Anna Ford after a dinner party at her home in Chiswick. The discretion of witnesses and the absence of chitchat protected Brown, who was classed by one Conservative newspaper as ‘single, reticent, good (#litres_trial_promo) humoured and charming’.

Divergence of opinion about a politician’s character is not unusual, but in Brown’s case it became particularly pertinent as he and John Smith reached a Rubicon. Economics, they agreed, had become a more serious business in politics. In any future election manifesto, Labour would need to provide statistics to establish its financial responsibility and to substantiate its challenge to Thatcherite orthodoxy. Any promises would require proof of proper costing. ‘Competence’ was the buzz word both bandied. To expunge the memory of Harold Wilson’s devaluation of sterling in November 1967 and the humiliation of Denis Healey begging for help from the International Monetary Fund in October 1976, it was best, they agreed, to support Britain’s entry into the Exchange Rate Mechanism. Labour’s support for the ERM would convince the electorate of the party’s commitment to non-inflationary policies. Smith and Brown approached Neil Kinnock for his support. Kinnock, who was equally worried about Labour’s image as irresponsible economic managers, was persuaded by the other two that the party needed to become conventional about spending and inflation, and against devaluation. Supporting the ERM, he was told, would prove Labour’s responsibility. At the same time, the party should also abandon its undertaking to withdraw from the European Union and even pledge to revalue the pound if the Tories devalued.

During those weeks, Brown did not ask himself how he, an anti-monetarist, could support the identical policy as Nigel Lawson, a monetarist. The more important conundrum was preventing new divisions in his own party. Inevitably, there would be arguments and casualties. Once Kinnock had committed Labour to Europe, the anti-Europeans would fight back, especially Bryan Gould, the aspiring left-wing leader of the party who was still promoting renationalisation and devaluation. The only solution to Gould’s opposition, Brown and Smith might have agreed with Samuel Brittan of the Financial Times, was to ‘put him on a slow boat to China’. Brown’s method was more subtle. By stealth, Gould’s influence was to be obliterated.

At the shadow cabinet meeting on 16 November 1989, John Smith described his proposed embracing of the ERM. By not joining, Brown added, Britain’s prosperity had been damaged. As predicted, Gould protested, outrightly opposing a policy switch. Kinnock did not respond. ‘It’s like fighting a marshmallow,’ Gould realised. ‘No one is willing to take me on.’ At the end of that day Gould blamed Mandelson for his humiliation, but in retrospect he understood his mistake. Gordon Brown, not Mandelson, had been planning his downfall, but Brown’s opposition had been so ‘subterranean’ that Gould had wrongly identified his enemy. He was being sidelined by Brown on the grounds of personal dislike and political disagreement. Lacking a powerbase within the party, Gould could not outwit a machine politician with fifteen years’ experience in Scotland of settling grudges without overtly plunging the dagger. ‘I’m being destroyed by stealth,’ Gould complained. ‘I’ve never been confronted with the reasons for my demotion.’

Brown misunderstood the ERM. At a subsequent meeting of the Parliamentary Labour Party (PLP) to discuss the system, he told MPs that by linking the value of sterling to that of other currencies, Britain would be applying socialist planning to the economy rather than relying on market forces. In crude terms (#litres_trial_promo), he was convinced that the ERM would disarm, even punish speculators. ‘We can fight speculators if we join the ERM,’ he told the PLP, revealing his ignorance of the mysteries of markets. He failed to (#litres_trial_promo) understand that speculators profit from fixed exchange rates, and that membership of the ERM would prevent Britain from unilaterally changing its interest rates. ‘This is the economics of the madhouse,’ thought Gould as he listened to Brown’s arguments. Brown and Smith, he realised, genuinely believed that the ERM was ‘a new magical device which would insulate their decisions about the currency against reality’. Brown was deluded that a handful of central bankers could beat the money markets.

To improve his understanding of economics and improve his relationship with the media, Brown recruited three advisers – Geoff Mulgan, Ed Richards and Neal Lawson. Mulgan, the senior adviser, had already established a relationship with Bill Clinton’s staff in order to learn how Labour might change its image and policies to appeal to the middle classes. Richards and Lawson were young and inexperienced, but satisfied Brown’s need for help both to mount a sustained attack against Thatcherism and to promote himself within the party.

Margaret Thatcher’s encouragement of greed, according to Brown, had splintered British society. In a seminal article published in the Guardian on 21 September 1990, he expounded his loathing for ‘an ageing leader’ who sounded too old to care and who was, like Mao, determined to stay on at any price. His accusations were harsh. The result of her ‘dream of unrelieved competition to produce improvement’, Brown wrote, accompanied by the ‘nightmare of any support by the state’, had been that ‘the rich have done better, the poor worse’. He railed against Thatcher’s ‘unfettered market’, her ‘promoting self-improvement of the poor’ and the ‘weaning [of the poor] from welfare’. He attacked the proposed privatisation of prisons, air traffic control and London Transport as sinful, cursed by ‘the enthusiasms of an extremist tendency too young to care’. The Thatcherites’ pretensions and wild assertions were, he wrote, merely a smokescreen to ‘promote self-indulgence among the very rich’.

In a similar vein he toured Labour associations, occasionally helped by Douglas Alexander, a young Scottish lawyer crafting his speeches, damning the ‘markets [which] cannot (#litres_trial_promo) educate’ and urging investment in British technology to fill the country’s ‘innovation gap’ and ‘training gap’. His campaign was not universally applauded by his colleagues. He was accused of being an effective critic, delivering coruscating diatribes against Thatcherism, but providing few new ideas for a cure. He spoke fluently, full of certainties, simultaneously as a moderniser and a traditionalist, but seemed uncertain about the consequences of his proposals. His reputation rested on his industry, but the party’s intellectuals wanted a heavyweight, left-wing analysis of Thatcherism. They questioned whether Brown was merely a Labour loyalist, promising the creation of ‘economic powerhouses’ to create jobs and an end of unemployment, or an original thinker. His journalistic, broad-brush approach to politics, rarely arguing about socialist philosophy, was proof for his critics of frivolity. ‘He has a moral revulsion against the government,’ wrote Paul Addison, ‘but you felt he would only offer a more decent form of Thatcherism in its place. It’s no longer really a socialist solution.’

Brown hated any criticism, and these attacks were particularly serious. His reaction was noticeable. The formerly witty, approachable man was gradually assuming the posture of a burdened statesman. To prove his suitability for power and to protect himself from making mistakes, he adopted a new gravitas in order to help establish Labour’s reputation for competence. Journalists travelling with him noticed how his good humour evaporated when a camera appeared, and despite his friendship with an interviewer, a sheet of plate glass would suddenly seem to separate the two. Anxious to micro-manage his appearances, Brown adopted a habit of robotic repetition. One memorable example of his repeated attempts to manipulate the agenda occurred during an interview with David Frost. In reply to an enquiry, Brown said, ‘That isn’t the question.’ Frost retorted, ‘Yes it is, because I just asked it.’ The mystery for his new audience was whether Gordon Brown would emerge as an undisputed leader thanks to some hitherto unseen magic, or whether the enigma merely masked blandness.

His opportunity to disarm the cynics came on 5 October 1990, the last day of the Labour Party conference in Blackpool. After many bitter arguments, Margaret Thatcher had reluctantly announced that Britain would join the ERM, at the rate of £1 for DM 2.95. Critics immediately predicted disaster, believing that the pound was overvalued. The prime minister was beleaguered. By contrast, Smith and Brown appeared serene. Labour’s lead in the polls had soared to double figures, and the party leadership, convinced of the country’s weariness with Thatcher, believed that electoral victory was inevitable. The question was whether Labour would support the government’s application to join the ERM at the high exchange rate. Most people were unaware that a year earlier, John Smith had quietly announced his support. At 4 p.m. on the last day of the conference, Roy Hattersley called Smith. ‘What’s our policy on ERM?’ he asked. ‘No alternative but to support the government,’ said Smith.

Five years earlier the party, including Blair and Brown, had supported a policy of withdrawal from the European Union. Brown had played a significant part in transforming Labour into a more electable party, as had Blair. Charles Clarke, Neil Kinnock’s chief of staff, had asked John Monks, then deputy general secretary of the TUC, to meet the two MPs as examples of the party’s encouraging future prospects. In Monks’s opinion, Blair had proven his abilities in 1988 by astutely negotiating an agreement with the unions to acknowledge that the new Conservative laws ending the closed shop (which compelled workers to belong to a union) would not be revoked by a Labour government. That success had, in Monks’s opinion, catapulted Blair up to Brown’s level.

Although the two were close, their differences were marked. Blair took a metropolitan view of politics, eager to lobby for the support of the rich and to criticise the trade unions. By comparison, Brown refused to attack the trade unions, and remained antagonistic towards capitalism. The similarity between the two was that both felt ‘modernisation’ was necessary to win an election. While Brown’s journey had been a struggle through a mass of research and intellectual reasoning, Blair acted largely by instinct. One marked difference was in their attitude towards John Smith. Brown was committed to his mentor, but in Blair’s opinion Smith was tainted by his toleration of cronyism and corruption among local party activists employed by the council in his Monklands constituency. Similarly, Blair had little confidence in Kinnock. By the end of 1990, Brown’s mood about the party’s leadership was edging closer to Blair’s. The countdown to the test of his character began on 28 November 1990. The outcome would depend upon his courage.

Eight days after failing to win sufficient votes in the first ballot of Conservative MPs in a leadership vote brought about by Michael Heseltine’s challenge following Geoffrey Howe’s devastating resignation speech, Margaret Thatcher resigned as prime minister. John Major’s election as the new leader revived the Tories’ fortunes in the opinion polls. Labour fell 5 per cent behind the Conservatives. Overnight, Brown’s unease about Labour’s election chances increased. The task of persuading the electorate of Labour’s financial competence fell to him and John Smith. Smith proposed launching an offensive in the City, which had been rapidly denuded of Tory grandees following ‘Big Bang’, which transformed not only the City but Britain as a whole.

Over the next two years, Smith and Brown frequently visited financial institutions in a ‘prawn cocktail circuit’ in an attempt to attract supporters. They were successful among the American, Australian and continental bankers who lacked tribal prejudice against old Labour. But British stalwarts like Lord King, Rocco Forte, Lord Delfont, Stanley Kalms, Alan Sugar and Clive Thompson were incontrovertibly grateful to Thatcher’s revolution. Few were convinced that Smith and Brown actually liked the City’s denizens, or understood the complexities of bank capital. Brown appeared not to have lost his conviction that ministers and civil servants could manage industry better than the entrepreneurs. His references to (#litres_trial_promo) the Guinness and Barlow Clowes scandals cast him as a mudslinger, unaware that the development of the City as the world’s third-largest trading centre would destroy the amateurs he loathed.

Brown was scathing about such criticism. Honesty, he said, was more important than undeserved wealth. His ‘vision for the (#litres_trial_promo) new world’ to replace the Tories’ ‘bleak, gigantic marketplace of self-seekers, each in lonely competition with each other’ was ‘a community of opportunity’. The rottenness of Thatcherism was epitomised by the appointment of fourteen former Conservative ministers as directors of companies they had helped to privatise. Those appointments suggested more than greed. ‘Privatisation,’ Brown said tersely about the new millionaires, ‘began with selling the family silver. It is now ending in the farce of golden parachutes for departing cabinet ministers.’ The recipients of ‘jobs for the boys’ included Norman Fowler, the former transport minister who joined National Freight, a company privatised by his department; Norman Tebbit, the ex-industry secretary who became a director of the newly privatised British Telecom; Peter Walker, formerly energy secretary and now a director of British Gas; and Lord Young, another former industry secretary who, after overseeing the privatisation of Cable and Wireless, was appointed a director of the company.

Those apparent conflicts (#litres_trial_promo) of interest were to Brown as repellent as the huge profits earned by the newly privatised utilities and the unprecedented pay increases which their directors awarded themselves. His cure was a reaffirmation of the virtues of public ownership, a national investment bank, legislation to ban ‘unjustified rises in company directors’ pay’ and a ban on ‘huge perks’. Labour insiders including Charles Clarke noticed Brown’s cautious retreat from ‘modernisation’ as he once again opposed the privatisation of state monopolies. Nothing was said, however, because his attacks helped bring John Major’s honeymoon to a quick end. Electors voiced their disenchantment about perceived corruption, the faltering economy and bickering ministers. Major, who irritably described Brown as ‘a master of the personal insult’ and ‘a dismal Jimmy, always jumping onto bad news and ignoring anything good’, appeared vulnerable.

Rattling the prime minister emboldened Brown. He had won a reputation as a serial embarrassment to the government by regularly revealing confidential information supplied by disgruntled civil servants; his latest had (#litres_trial_promo) exposed the government’s refusal to increase consumers’ rights against the privatised utilities. By spring 1991 (#litres_trial_promo) he consistently appeared the outstanding member of the shadow cabinet, ranking among Labour’s giants. The perceptive interpreted his speeches as reflecting his serious disenchantment with the party’s leadership. To Kinnock’s irritation, he was mentioned as the leader-in-waiting. Dissatisfaction was particularly prevalent among Scottish MPs fearful of a fourth election defeat.

Although the opinion polls had swung back in Labour’s favour, a weariness was infecting the party, and there was uncertainty about whether Kinnock could win an election victory. With Blair’s encouragement, his personal assistant Anji Hunter and Peter Mandelson were touring Labour constituencies to identify kindred spirits who supported radical change despite intimidation and threats of deselection. The roots of the New Labour project, forging a brotherhood of survivors before the outbreak of renewed conflagration, started just one year before a general election which Kinnock anticipated winning. The birth of this magic circle, born from despair and cemented by bonds of close friendship, was gradual. In Mandelson’s version, he was uncertain whether Labour could ever win an election with a Celtic leader. Over lunch with a sympathetic journalist in 1991, shortly after his selection as the parliamentary candidate for Hartlepool, Mandelson mused, ‘It’s time we had an English leader.’ He was already veering towards Blair. ‘People listening to the BBC’s broadcasts of Blair’s speeches,’ continued Mandelson, ‘say here is the next leader of the Labour Party.’ He would later deny having turned away from Brown so early.

Brown was more concerned by the substance than the image. Despite his visits to the City, John Smith favoured the old-style socialist command economy rather than an equal partnership between the government and capitalists. Brown’s conversations at his regular dinners with Doug Henderson, Martin O’Neill and Nick Brown revolved around replacing Smith’s obsolescent ideology with a new agenda. ‘You’re promising things you can’t deliver,’ O’Neill told Brown. ‘It’s the same trap as the seventies.’ Usually, Brown did not comment. Despite the Glasgow versus Edinburgh friction, he shared the same Christian socialist values as Smith. Both favoured community values rather than satisfying the aspirations of the enfranchised ex-working classes. Like Smith’s, Brown’s world revolved around Scotland’s party machine and the plight of Kirkcaldy and similar Scottish communities – uneconomic coalmines, decrepit linoleum factories and Harold Wilson’s failed investments in technology – and what he called ‘the causes of (#litres_trial_promo) poverty which are unemployment and a welfare state that isn’t working’.

To avoid criticism from the trade unions, Brown resisted questioning Smith’s agenda even among friends, although he knew he would have to break away from that view. During 1991 he confided to Peter Mandelson that Smith would be unsuitable as chancellor if Labour won the 1992 election. Smith, he believed, was too dogmatic and simplistic on economic matters. Mandelson and Brown agreed that electoral success depended upon committing the party to as little as possible. Contrived obfuscation was the ideal strategy. The obstacles were Smith, who was antagonistic towards such tactics, and Kinnock, who was reluctant to endorse Brown’s proposals to prove Labour’s economic competence.