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Sunday, January 18, 2015

Author claims Miliband ‘kept quiet’ on fears of economic crash

The Sunday Times reports on a new book by Martin Winter, a former friend of Ed Miliband, which claims that the Labour leader and his Shadow Chancellor, Ed Balls feared the British economy was going to crash a year before the Great Recession began in 2008 but decided to keep quiet.

Mr. Winter says that Miliband made the prediction during a discussion about the so-called “election that never was” in October 2007:

In a new book about the Labour leader, he portrays Miliband as chaotic and accident-prone. Winter was a leading Labour figure in Doncaster, and served as the town’s first elected mayor, but was expelled from the party in 2008.

Gordon Brown came close to calling a general election just months after he took over as prime minister from Tony Blair in 2007, but cancelled his plan at the last minute.

Winter claims that two weeks after the snap election was called off, Miliband, who was then the climate change secretary, told him: “The simple fact is the economy is going to fall off a cliff and this was our best chance of winning. The economy is going to get a hell of a lot worse over the next two or three years and we’ll get the blame for it; so it was either going now and risk losing or wait and know that we’re going to lose.”

Eleven months later, Lehman Brothers bank collapsed, triggering a banking crisis that led to the deepest recession in Britain in more than a century.

I am currently reading Damien McBride's account of this period, which as Andrew Rawnsley so graphically puts it is a 'self-abasing' justification of the ends justifying the means. However, although McBride and Ed Miliband fell-out with each other, there is no hint of a forthcoming economic collapse being the reason why the now-Labour leader might have favoured an early election. Indeed the banking crisis appears to have come as a complete surprise to Gordon Bown and company.
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