Brown's day of judgment nears

CHANCELLOR Gordon Brown is in danger of staying in the same place for too long - hence his well-publicised impatience to move on to the top job.

His favourite joke is: 'There are two kinds of Chancellor: those whose careers end in failure; and those who get out in time.'

For the past two years I have mused on the careers of Chancellors, while working on my book, The Prudence of Mr Gordon Brown. Of the Chancellors I have known, Reginald Maudling (1962-1964) was removed - along with the rest of Sir Alec Douglas Home's Conservative Government - by the vote of the electorate.

So it was not he who suffered the consequences of his celebrated Dash for Growth but James Callaghan, Chancellor from 1964 to November 1967.

To paraphrase another of Gordon Brown's favourite lines, Maudling presided over the boom and Callaghan over the bust, ending with the humiliating devaluation in November 1967, which prompted the latter's resignation

While I didn't have a ringside seat, I certainly had a view from the gallery, since I covered the closing stages of Maudling's Chancellorship and the opening years of Callaghan's for Sir Patrick Sergeant, the City editor of the Daily Mail and News Chronicle.

Roy Jenkins, who succeeded Callaghan from 1967-70, gained a remarkable reputation in a short time. He had to deal with the consequences of the bust and, in a favourite phrase of the time, to 'make devaluation work'.

Notwithstanding a claim to the contrary by Prime Minister Harold Wilson, the pound in people's pockets had been devalued, in the sense that imports cost a lot more, and the Chancellor did not want the trade unions to ruin the exercise by trying to compensate with excessive wage claims.

Jenkins was blamed for Labour losing the 1970 General Election. In fact Labour had been ahead in the polls, and Jenkins' policies had worked.

But he and Wilson ignored a warning that a freak set of trade figures might change people's perceptions. Sure enough, the importation of two jumbo jets from the US in one month produced headlines such as 'Britain Back in the Red'.

The Press and the Tories made a meal of the situation, and in came the 1970-1974 Government of Sir Edward Heath.

Heath's first Chancellor, Iain Macleod, died within weeks of taking up his post. Tony Barber, his successor, presided over the eponymous Barber Boom which ended in a dramatic bust, leaving Denis Healey, Labour Chancellor from 1974 to 1979, to pick up the pieces.

That Labour Government ran into all sorts of other problems, ending up in the hands of the International Monetary Fund in 1976.

It was an amazing time with inflation hitting 28% at one stage and Labour intellectual Tony Crosland having to admit that for local authority spending, 'the party's over'.

Gordon Brown arrived at Westminster in 1983. During his long period in opposition, he had plenty of time to study the history of the Labour Party. In the 1980s he had ample time to study yet another period of boom and bust under Nigel Lawson, who was Chancellor from 1983 to 1989.

Brown largely succeeded in winning the trust of the electorate and the City during the first term - but more recently, 'Prudence' has run into trouble.

Unfortunately, the counterpart of the prudent first term was that many problems in public services and transport system simply piled up. Although Brown's job is far from done, his tax and spend strategy is coming under scrutiny.

There are also growing mutterings that for all his prudence - he has produced another Maudling/Barber/ Lawson-style boom, and bust may follow.

The jury is still out on whether Gordon Brown failed to get out in time.

William Keegan is an economics commentator. His book, The Prudence of Mr Gordon Brown, has just been published by John Wiley & Sons at £18.99.