Gordon Brown and the British Way of Risk-Based Modernization

Abstract

In Beyond the Crash: Overcoming the First Crisis of Globalisation, Gordon Brown has sought not only to demonstrate how his political leadership helped to save the world from what Gordon Brown has termed ‘the Great Recession’, but also to set out his recommendations for surmounting what he has depicted as ‘the first crisis of globalisation’. A series of spectacular market failures, most notably bank failure arising from undercapitalisation, caused in turn by ‘recklessness and irresponsibility all too often caused by greed’, has been presented to the reader as if Gordon Brown was a detached observer who could not have possibly previously been aware of the extent of risk-taking made possible by his own risk-based model of financial regulation. This paper argues Gordon Brown’s analysis is fundamentally flawed. We are not now living through the first crisis of globalisation. On the contrary, what Gordon Brown has actually documented is the first crisis of his own deeply flawed British model of political economy, which socialised risks and privatised profits. The paper explores how Gordon Brown’s attempts to modernize the politics and political economy of the United Kingdom, using the City of London’s liberalized markets as a blueprint, has left the United Kingdom facing an age of austerity that was politically self-inflicted rather than financially imposed by external global market forces.