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Friday, November 07, 2008 

A blip?

What a difference a couple of months can make: back then we were seriously discussing the possibility that Glenrothes could be Gordon Brown's last stand as Labour leader, where a defeat to the Scottish National Party would mean his cabinet colleagues would move against him, with David Miliband the most likely successor. Harold Macmillian said that it was events that were most likely to blow a government off course, but it was the apparently imminent collapse of the banking system which has turned out to be Gordon Brown's saving grace. Having bailed out them and by his own spin, having led the world at large to decide upon a similar policy, he's almost certain now to lead Labour into the next election.

The circumstances of the win in Glenrothes are enough to make you question whether there was a cock-up or conspiracy in Labour's apparent acceptance that were going to lose yesterday's vote. Use of Occam's razor would suggest the former, but how on earth do you go from the apparent doom expressed to the media by Nick Palmer, who said that he didn't know any Labour MPs who expected to win, to what looks like a remarkable in the circumstances 6,000+ majority? The betting was all on the SNP to win, with Paul Routledge alleging there was a conspiracy amongst SNP supporters to lay bets around the country in order to get the odds back in their favour, and the pundits all agreed that the SNP were likely to take it, but how do you not apparently manage to realise that you've got a more than healthy majority in the bag?

Labour's share of the vote in actual fact increased, despite their majority dropping by around 4,000, something which has not happened to a government fighting a by-election since 1982. The vote for both the Conservatives and the Liberal Democrats collapsed, possibly because of their failure to campaign in what was seen as a straight fight between the SNP and Labour, but it's hardly encouraging for the leadership of either party, especially David Cameron, whose hopes for the next election were on the SNP taking Labour's Scottish seats in the areas where his party is not close to being in the running.

Most impressive is perhaps not the result, but the way in which Labour so successfully, at least for now, turned the onus onto Alex Salmond. Despite the fact that it's Gordon Brown himself who's primarily responsible for the bursting of the biggest economic bubble of recent times, the attack on Salmond's plans for independence was pointed and damning. An independent Scotland would not have been able to bail out the likes of Royal Bank of Scotland and HBOS in the way that Westminster had, went the argument, whilst the television networks happily played along, repeating and replaying Salmond's in hindsight naive rhetoric about how Scotland, along with Iceland, Ireland and the Scandanivan nations could form an arc of prosperity if only it was freed from the union.

The last few days, in contrast, really should have been horrendously damaging for Gordon Brown and New Labour: first the European commission reported that the UK would face the deepest recession among the EU's mature economies, then the IMF issued a similar verdict, which also said the UK would be the worst hit of the world's developed economies. For a man and a spin machine which had boasted repeatedly that we were well-placed to deal with the economic downturn, if not among the best-placed, this should have been enough to puncture any sign of personal political recovery. Instead, with the election of Barack Obama helping to distract attention away from events here, the story has been the exact opposite.

To draw much else from the victory in Glenrothes would be wrong. It's almost as if the whole by-election was conducted in a vacuum: the opinion polls show at best that the Brown bounce has been fairly negligible, at least in personal terms. Labour has clawed itself back up from 20% behind the Tories to between 8 and 9% behind, which in a general election would deliver either a hung parliament or a very slight majority for David Cameron, which for a government in the middle of a third term in a soon to be recession isn't bad, but certainly isn't going to save it. As the downturn starts to really bite and unemployment rises further, it's then the resentment against Labour will likely start to really affect things. The odds are most certainly still on for a Conservative victory, and Labour's hopes in the long-term still look fleeting at best, Gordon Brown saviour of the world economy or not.

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Salmond's rhetoric on Iceland and Ireland was not helped by being repeated in the Scottish government legislative programme document and parliamentary statement in September just before the final collapse, and some 5 months after The EConomist warned that Iceland was in dire trouble.

I think his speech to Harvard earlier this year was also used by some campaigners. Alex had claimed something along the lines that Scottish banks were the most stable financial institutions in the world. GIven this and his previous employment within the Scottish banking sector - these factors contributed to an impression that wee Eck was not wholly on top of things.

Scott

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