Gordon Brown finally admits making a big mistake…

“We set up the FSA believing the problem would come from the failure of an individual institution. That was the big mistake. We didn’t understand just how entangled things were… I have to accept my responsibility.”

There is a rumour going round Westminster that the deficit-denier-in-chief will descend from Kirkcaldy to speak in the budget debate. No doubt he will wish to offer his support to the Eds, they are after all his political sons.

That loud braying sound you can hear in Westminster is the sound of cheering emanating from the Treasury…

The appointment of Ed Balls as shadow chancellor means that deficit denial becomes the central economic policy of the Labour Party. In essence both the Eds intend to argue that it was the banking crisis and only the banking crisis that caused the deficit. In taking this policy direction they repudiate the more sensible realistic policy followed by the last Labour Chancellor, Alistair Darling.

It also flies in the face of statements made by Tony Blair in his memoirs and as recently as last Friday at Davos. Since Balls isn’t an idiot we have to ask ourselves: why is he trying to deny reality? Does he think the voters can be convinced that overspending wasn’t a problem until the banking crisis? Here he is telling Andy Marr there was no structural deficit under Labour:

Clearly both the Eds think they can blame it on the bankers, popular understanding of the deficit is hazy. The huge one-off costs of bailing out the banks and the constant government-debt-bloating-deficit are confused in the popular consciousness. Even the debt and the deficit are confused in many people’s minds. Whenever Ed Miliband is cornered on spending or taxes he reaches for the banker bogeyman – tax them more and it will sort everything out. None of this adds up to anyone with any financial literacy, which unfortunately is a minority of voters, the majority of voters do blame and detest the bankers.

For this argument to make sense of course requires Ed Balls to deny that there is, or ever was, a structural deficit that had to be tackled. Which is exactly what he did on the Marr show today.

Denying the deficit and blaming the government’s debt crisis on the bankers is an attempt to absolve Brown, Balls and the Labour Party of the blame. It thus allows Balls to claim that, since there is no structural deficit, the cuts are unnecessary and ideological. Which is exactly what he does.

The problem for Balls is that the public senses innately that the government under Brown’s chancellorship and premiership was overspending. If Osborne can keep that national memory alive over the next three years the public will forgive him doing what is necessary. If they forget, or prefer to believe Ed Balls’ claim that cuts are not really necessary, they will blame the government for the coming hardships. The deficit blame game will have to be played until the next election.

Bob Crow’s penchant for organising transport strikes gets up commuter’s noses. This picture in the News of the World taken on a carribean holiday shows that the £133,183 agitator even gets up his own nose. Remind you of someone?

Greg Hands asked the Deputy Leader of the House yesterday:

“My Honorable Friend has spoken of the success this year of the orientation programme for new members. But existing members should not be overlooked. I note that one member has spoken only once since the Election; hasn’t asked a single question; and has made only 5 of the possible 131 votes. Would the Deputy Leader of the House agree to approach the Member for Kirckaldy and Cowdenbeath, if he can find him, and see if some orientation might help?”

Kevin Maguire and Charlie Whelan are two of the most high profile former members of the inner-circle of the TaliBrown, now they are at the core of the continuity-TaliBrownies. Both are allies of, and boosters for Brown’s heir, Ed Balls. Both of them today are not happy…

Our Kevin says Not-So-Red-Ed was “scared of his shadow – or at least the notion of making either Ed Balls or Yvette Cooper his Shadow Chancellor. So the timid new Labour leader fluffed his first big call and played safe with Alan Johnson. As a result he missed a glorious opportunity to recast his party’s economic policy and to turn the tables on the Tories.” Maguire, in his role as TaliBrown propaganda chief, makes no secret of his preference for deficit denial.

Despite swinging the unions behind Red Ed to win control of the Labour Party, the TaliBrown bully and union-fixer Charlie Whelan is still unhappy; mainly with Peter Mandelson and David Miliband. Telling The Times that David Miliband was annoying and should “get a life” after his failed leadership battle, adding for good measure that his exit from the Shadow Cabinet was ungracious.

“It was slightly self-indulgent to just go off. It didn’t look good. It would have been best for him to say straight away what he was going to do. It’s a tragedy when you lose your job, you are on the dole and you have no money for your family. Politician losing top job is not a tragedy. It’s personally uncomfortable but that’s all. This is why David’s attitude annoys me. He didn’t get the job but it’s not a disaster. Get a life.”

Whelan also backs Ed Balls to be Chancellor in the Shadow Cabinet claiming “He’s got a grasp of the economy and his position on the economy is the right one”. Charlie adamantly rejects the accepted wisdom that Labour’s defeat in the last election was in any part down to Gordon Brown’s deficit denial, claiming

“We could have won that election. Peter Mandelson went round at Christmas saying it’s going to be a catastrophic defeat. Well, if you’re going into the election with your main man telling you you’re going to be defeated then you might as well pack up and go home. Obviously the campaign was an unmitigated disaster.”

Guido can see Balls and his boosters waging low intensity political warfare on Red Ed for as long as he seeks to get on the reality-based side of the deficit denying dividing line. That is something Balls and the rest of the continuity-TaliBrown will be determined to block…

The metal plaque commemorating the opening of the Canary Wharf offices by Gordon Brown in April 2004 is up for auction at Christies at the end of this month. Guido will be bidding for this, tangible evidence, that the accursed Gordon Brown caused the global financial collapse which began with the fall of Lehmans.

He jinxed the financial system…

Lest we forget the 13 years before the last 100 days…

Two years ago when Guido first asked the question “Is Brown Bonkers?“ he raised hackles in the unpopular parts of the blogosphere, Sir Michael White and others said it was an unpleasant smear and there was general condemnation for bad taste. Guido felt, once again, like the little boy who pointed out the emperor’s nakedness.

Yet senior Blairites were adamant, telling Guido that Brown was mentally unsound. In Westminster there was a muted but open debate in the margins as to Brown’s mental state; Was he autistic? Was it Aspergers? Did he have a personality disorder? Was he on medication? Even Andrew Marr asked him “Are you on drugs?“

Now Mandelson reveals that it was the view of Tony Blair, who had worked closely with Gordon Brown for two decades, that he was

“Mad, bad, dangerous and beyond hope of redemption… flawed, lacking perspective and having a paranoia about him… He’s like something out of the mafiosi… He’s aggressive, brutal…there’s no one to match Gordon for someone who articulates high principles while practising the lowest skulduggery.”

The national tragedy of Gordon Brown is two-fold; he blocked Tony Blair’s necessary welfare reforms not out of principle, but merely to frustrate Blair for his own personal political advantage. Secondly for purely political reasons he pursued Kamikaze economics that drove the economy into unprecedented levels of debt. The mad rivalry with Blair when the British economy was in the best shape to carry out the reform of the welfare state wrecked the best opportunity to ready Britain to compete in the global economy of the future.

Brown’s personality problems will be paid for over generations, this government is now implementing many Blair-like reforms that could have been carried out a decade ago when the economic conditions were far less difficult. The madness of Brown’s debts will be paid for by our children’s children.

When Rawnsley’s The End of the Party book came out in January on the heels of Peter Watt’s Inside Out and the allegations of Prime Mentalism committed by Gordon Brown were again denied, Guido predicted that Labour Will Have a Khrushchev Moment of Truth in the End:

When Brown has gone after the election it seems inevitable that we will eventually have a Khrushchev moment, where a senior Labour figure articulates what everyone knows.  It will be devastating.  Gordon Brown is a malevolent, deeply damaged and unpleasant human being.  He is at the centre of a culture of political bullying that has been unhealthy for the Labour Party and the government.  The loyalist cabal around him are unpleasant people who have no place in a healthy political culture, they are as secretive and malicious as they are vindictive and vicious.

Gordon Brown was often compared to Stalin, but who will be Labour’s senior Krushchev figure who condemns the previous regime? Mandelson has laid to rest any continuing pretence (if there was any) about the TeeBeeGeeBees, the vicious infighting that paralysed Whitehall for a decade, yet was denied on camera in barefaced lying by Labour politician after Labour politician, including Mandelson. Mandelson is getting all the coverage for his book The Third Man highlighting the failings of Gordon Brown. Less focus is on David Miliband, Mandelson’s new protege gave a speech yesterday that comes near to that Krushchev moment

I agreed completely with Gordon Brown, when he became Prime Minister in 2007, that we needed renewal.  I supported and voted for him.  I agreed that we needed greater moral seriousness and less indifference to the excesses of a celebrity drenched culture.  I agreed with him when he said that we needed greater coherence as a government, particularly in relation to child poverty and equality.  I agreed with him on the importance of party reform and a meaningful internationalism that would be part of a unified government strategy.  I agreed that we needed a civic morality to champion civility when confronting a widespread indifference to others. But, it didn’t happen. It was not just more of the same.  Far from correcting them failings – tactics, spin, high-handedness – intensified; and we lost many of our strengths – optimism born of clear strategy, bold plans for change and reform, a compelling articulation of aspiration and hope.  We did not succeed in renewing ourselves in office; and the roots of that failure were deep not recent, about procedure and openness, or lack of it, as much as policy.  That is a political fact and now words are cheap but the stakes are high.

It was a backhanded condemnation of Brown’s failure. If David Miliband wants Labour to move on, a frank, uncoded, reflection on the period of Labour brutalism is required. Brown was a disaster for the Labour Party and the country, if Miliband wants a reborn Labour Party he first has to bury Brown in the truth.

UPDATE : Punters give David Miliband a 63% chance of being the next Labour leader.