Something to Remember
ON 20 JUNE 2007 Gordon Brown was the main speaker at the Mansion House Dinner. At last he had achieved his ambition and was to become Prime Minister within two weeks. This was his final speech as one of the most successful Chancellors of the Exchequer.
There was a great air of celebration at the Dinner. Gordon was on a high and congratulated everyone for their wonderful success. He delivered a eulogy to globalisation, free markets and the British economy. He was proud of himself and said:
"In 2003, just at the time of a previous Mansion House speech, the Worldcom accounting scandal broke. And I will be honest with you, many who advised me including not a few newspapers, favoured a regulatory crackdown. I believe that we were right not to go down that road which in the United States led to Sarbanes- Oxley [draconian regulations] , and we were right to build upon our light-touch system through the leadership of Sir Callum McCarthy [Chairman of the FSA] - fair, proportionate, predictable and increasingly risk-based." Gordon thought that non-intervention and light-touch regulation were an essential interpretation of free-market economics and actively encouraged all the risk-taking.
Against this you need to place Gordon's current moral indignation about the bankers and financiers. Remember that in July 2006, and again in April 2007, Mervyn King, Governor of the Bank of England, had issued warnings about easy credit increasing "the vulnerability of the system" . He was ignored. ON 14 SEPTEMBER 2007, Northern Rock had to be bailed out by the taxpayer.