Steve Richards: Brown should follow Obama's lead

In contrast to the self confidence of Obama, the Prime Minister is trapped by the past
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President Obama recognises that words and gestures matter as much in office as they do out of it. In a distinct departure from the presidential norm, he uses the White House as a pulpit, giving interviews and press conferences as if he were still on the campaign trail.

This week he delivered his most important political sermon so far, telling senior bankers that their salaries should be capped and that they can forget about bonuses until the government had got its money back. There were no contorted qualifications, no nods and winks that he did not really mean what he said. Speaking on behalf of frightened and furious taxpayers, he put the bankers in their place.

How eerily neat it was to see Tony Blair by his side in the same week. Like Obama, Blair was a silver-tongued leader but one who chose to preach timidly safe orthodoxies. It is fascinating looking back at Blair's chosen themes for his monthly Downing Street press conferences. Nearly all of them were about the primary importance of Britain's relationship with the US, why his party should celebrate lightly regulated markets, and the importance of the private sector in the delivery of public services. He was always mesmerising, but not exactly daring in his crusades. The themes had been commonplace since the early 1980s. Still, in his apolitical focus on what is "practical", he would have slipped effortlessly into the new mainstream now, becoming the most crusading advocate for highly regulated markets and fiscal stimulus, preaching once more what most have come to believe already.

At least Blair recognised the importance of tone and mood music. Gordon Brown has shown no recognition that he has a pulpit, let alone used it. I watched his interview last Sunday on the BBC's Politics Show and wondered how many viewers would be following his technocratic twists and turns. Several times the interviewer asked for an explanation on behalf of his audience, or perhaps on behalf of himself. Brown seems to work on the assumption that everyone follows events as closely as he does, that we are all up at five in the morning to monitor fiscal injections, the state of bad assets and the rest.

In that interview Brown was asked about the bonuses and high wages still being paid out to senior bankers, including those now working for institutions largely owned by taxpayers. He responded by stating that he had "laid clear guidelines about remuneration and they should be adhered to". Such a deliberately opaque response shows the degree to which – in contrast to the uninhibited self-confidence of Obama – the Prime Minister is trapped by the past and is still resolving in his own mind the appropriate future relationship with banks. He does not use the pulpit partly because he fears the consequences of a clearly delivered sermon.

Obama has not been part of the previous two decades that are suddenly seen in a new light. While Reagan, Clinton and Bush paid homage to the lightly regulated markets, Obama was writing books about the importance of regulation. For the new President the electoral and economic cycles dance in near-perfect harmony. But for Brown the rhythms are out of joint. He was part of the previous era, and privately agonises over whether there was more he could have done to challenge it. Obama has four years in which to turn things round; Brown faces the electorate in little more than a year's time.

Brown also sees a thousand complexities behind every issue, sometimes a paralysing level of insight. In this case he recognises some banks are more culpable than others. He is also desperately seeking to restore confidence. The more the banks are undermined and constrained, the more risk-averse they will become. Brown is evidently not sure yet what form the balance of the relationship between government and banks should be. As the City minister, Lord Myners, explained in relation to the recent rescue package: "If we get it wrong and we charge too much, the banks will say we are not interested and continue to carry the risk and continue to be in the mire... if we don't charge enough, they will flood us with assets and we will end up putting public funds at risk."

The same calculations apply to salaries and bonuses. Get it wrong and the Government kills off the banks it seeks to revive. The tense relationship is emblematic of a wider-raging debate within government over the past decade. Can it intervene in a range of areas in ways that innovate and improve rather than stifle? Labour will leave office with the question unresolved.

What overwhelms such considerations now is the acute importance of tone and symbolism in an economic crisis of multilayered complexity. In the midst of deep impenetrable fog voters see clearly that the banks behaved recklessly. They understand also that the Government is investing billions to get them out of the mess. Then they hear bankers are getting bonuses that they could only dream of.

The anger fuels the tensions that erupted this week over the emotive issue of whether British jobs should be given to British workers. The most revealing explanation I have heard for what happened at the oil refinery in Lincolnshire is that the UK firm originally awarded the contract was not up to the job because of low productivity and poor management. Possibly the great taboo behind the influx of foreign workers in some industries is that some British companies and employees are not as good as they need to be. But the Government's moral authority when navigating around such issues is eroded when it steps away from the pulpit and treats the economic crisis as a technocratic challenge alone.

The Government's initial response to the strikes last weekend alarmed some Labour MPs as ministers appeared to convey contradictory messages. The alarm was reinforced when Brown and Lord Mandelson started to speak a sterner language in relation to the banks only after President Obama had issued his clear warnings. Does a US president always have to point the way? Not surprisingly, a lot of Labour MPs are wondering again about the strategic grip in Number 10.