THE ECONOMIC MELTDOWN: The political fall-outBy James Cusick
What a difference a week can make. In the behind-the-scenes preparations for last week's Labour conference in Manchester, those close to Gordon Brown believed the backdrop of the limited, but still potent, leadership challenge would dominate everything. Manchester would be about the prime minister trying to re-impose his authority on a party that no longer believed he was the answer to anything. How wrong can you get?
Instead, the global economic storm, still swirling in Washington, threw Brown a lifeline that has forced the Conservatives to accept they still have plenty to do before before the next election. Brown's supporters are now dreaming the unthinkable, that a Houdini-like escape can still be pulled off by the PM.
If, as one newspaper columnist put it yesterday, "Brown is back in the game" what put him there just as his party was ready to show him the red card?
The answer may lie in new opinion polls which show that inside a week - from a position that showed Labour trailing the Tories by more than 20% - Labour have won a conference bounce suggesting they have recovered much of the losses endured over the past year.
An ICM poll for the Guardian shows Labour recovering to 32%, the position Brown inherited from the failing Blair administration. A Tory lead is still there, but substantially cut.
An insight to the recovery is shown by another poll by ComRes for the BBC's Politics Show which points to Brown and the chancellor, Alistair Darling, being preferred by 36% of those asked who they'd like to see run the economy. David Cameron and the shadow chancellor, George Osborne are preferred by 30%.
So in difficult economic times, does the electorate still cling to the idea that "holding on to nurse, for fear of finding something worse" is the best strategy when the storm clouds are gathering?
Brown's whole tone and his wider message in Manchester was just that: yes, he could have done things better, but at the centre of a global economic storm, this was no time to put your trust in the inexperienced hands of novices.
Labour became the party of business, the progressive force that deregulated the City and used the trickle-down new-found wealth to fund the greater good. But in Manchester, emboldened by the multi-billion dollar rescues of mortgage giants Freddie Mac and Fannie Mae, plus the added "socialist" excitement that the capitalist model in place for so long was about to be destroyed and replaced by the big government the Republicans have always been against, Brown was openly talking about the successes of his government, about how they correctly nationalised the failing Northern Rock.
Had Brown made that speech a couple of months ago, it would have ended his premiership and gifted the Conservatives a unique narrative for their own gathering in Birmingham this week. Cameron still has the polls on his side. Faith in Brown hasn't returned with any great force, but there's now a question mark over who might be able to do things better. The ICM figures show 47% believing Brown should keep his job, with 44% saying someone else would be better.
Cameron has to limit his party's current over-confidence and channel its collective energy into portraying Brown - using Brown's own description given to the United Nations last week - as presiding over a decade of "irresponsibility".
But the economy is once again the deciding factor that will determine who wins the next general election, and by how much. The credit crunch and the global banking crisis saved Labour from looking irrelevant last week. This week it's the Tories turn.
Cameron has to find a way of linking his "Plan for Change" into the crisis in Washington and London and making the electorate believe he isn't a novice, but an economic realist. As one adviser to Osborne said: "It's not about the opinion polls this week, it's the ones next weekend that count. If Brown thinks he's just seen a miracle happen, well he should enjoy the break. I hate to tell him, miracles don't happen."
