It is often wrongly claimed that Gordon Brown failed to spot the housing bubble. In fact, he called the bubble as early as 2005. The trouble was he believed he had addressed it. Brown thought he had successfully managed a boom without a bust.
You can relive the hubris of the time by reading this passage from Brown’s 2005 speech to the Labour conference. No modesty here. But I think it was the one and only time he has used the word “house price bubble” as chancellor or prime minister.
We will have the strength and resolution to take the right long-term economic decisions too.
Why has it been that at every point since 1997 faced with the Asian crisis, the IT collapse, a stock exchange crash, an American recession, last year a house price bubble, this year rising world oil prices, why has it been that at every point since 1997 Britain uniquely has continued to grow?
In any other decade, a house price bubble would have pushed Britain from boom to bust. In any other decade, a doubling of oil prices would have put Britain first in last out and worst hit by a world downturn.
I tell you, it is because with Bank of England independence, cutting debt, fiscal discipline and the New Deal this Labour government has shown the strength to take the tough long-term decisions, that inflation is low, interest rates are low, growth has been sustained in every year, and we are closer than ever to the goal which drives us forward: the goal of full employment for our generation.
Labour, the natural party for economic strength in our country today.
Alex is right. Hubris took a hold on Brown very early on. He totally believes in his own infallibility.