Coronavirus: What Boris Johnson can learn from Gordon Brown’s response to the financial crash

The crises aren’t identical, but many of the responses remain the same, writes Sean O'Grady

Brown speaks at the London School of Economics in 2016 (Getty)

Some politicians are made by a crisis; others are destroyed by one; but Gordon Brown may be the first ex-prime minister to have had his reputation greatly enhanced by a crisis almost 10 years after he left office.

The Covid-19 epidemic has had the curious effect of making people feel nostalgic about the (relatively) good old days of the banking crash. In a series of statesmanlike interventions this year, Gordon Brown and Alistair Darling, his chancellor at the time, have reminded us how calmly and assuredly they guided Britain, and indeed the world, through a financial crash that could have left the globe in a prolonged economic slump. Comparisons with now are inescapable.

Boris Johnson, in other words, is in danger of making one of his most maligned predecessors look good. This is, though, at least a little unfair. Brown’s initial response, like Johnson’s now, was uncertain. Like the Covid-19 pandemic, the crisis that began in 2007 had few if any precedents. At first there was a similar mood of denial – assurances from the authorities that the economic fundamentals were strong and there was no need for panic. There was at first no great rush to slash interest rates or boost economies; if anything inflation was a slight worry. Northern Rock, the first casualty, was supposed to be an outlier, and its shares were being traded long after it publicly got into trouble. It was a “liquidity” crisis they said – not enough cash at hand in a basically sound system. In reality it was an “insolvency” crisis – the banks were basically busted.