Money worries will put paid to a beleaguered Brown

That YouTube video of Gordon Brown trying to explain his policy on MPs' pay looks like going down as his comic epitaph. Rather like James Callaghan at Guadeloupe saying "crisis, what crisis?" in 1978, or Thatcher elbowing John Sergeant aside at the Paris Summit in 1990, it's the one that will run and run. No politician since Richard Nixon has looked so shifty on camera. Partly, it was that plastic smile that the PM plants on his face at inappropriate moments, as if someone other than he is in charge of his facial muscles.

But it was also the sheer audacity of trying to bounce parliament and his party this week into endorsing a new scheme of MPs' allowances which is actually worse than the existing discredited system and likely to cost more.

There is no way that a flat-fee system - known as "sign on and sod off" in Brussels - is going to allay public concern about the misuse of public funds. Nowadays everyone, even journalists, have to furnish receipts before claiming expenses, and the public cannot understand why MPs should be treated any differently. It was the revelation that MPs could put all manner of items from bath plugs to porn movies on expenses, no questions asked, that brought about the crisis in the first place.

Ministers are now trying to cobble together a compromise to stave off a humiliating defeat in the Commons vote later this week. But they are still trying to do so on the basis of a flat-rate fee, albeit one requiring MPs actually to stay overnight when they claim it. This will not work because it still fails the test of transparency. I don't understand why they don't just introduce the system in operation in the Scottish Parliament where everything is open and above board, and where parliamentary expenses are no longer a political issue.

Instead, there is talk of resignations in July when the public finally learn what MPs have been up to. Many have been using their £20,000 second-home allowance to leverage multiple mortgages and have become property developers owning second, third and fourth homes yielding hundreds of thousands in capital gains. Hardly surprising that MPs were relaxed about the house price bubble when so many of them were making so much money out of it. I'm sorry, guys, but the party is over. Wake up to the age of thrift.

The expenses affair has underlined the extent to which the Prime Minister is simply out of touch. Over the weekend the row morphed into a generalised revolt against the Prime Minister's authority. Cabinet ministers from Harriet Harman to Peter Mandelson are now criticising Brown more or less openly in the press. The Blairite old guard has emerged from the woodwork looking for payback.

The Damian McBride smear e-mails affair allowed former Blairite ministers such as Alan Milburn and Charles Clarke to attack Brown by association. But yesterday we had the extraordinary spectacle of one of the apostles of New Labour, the former Transport Secretary Stephen Byers, calling on Brown to scrap identity cards and shelve the Trident missile system. You know things are really bad when Blairite ministers start attacking Brown for not being left-wing enough.

The continuation of Britain's "independent" nuclear deterrent was a key issue for Tony Blair and he made sure that he secured a vote on the renewal of Trident before he left office. Biometric identity cards were also a touchstone for New Labour, seen as an indispensable weapon in the "war against terror". Stephen Byers coming out against these policies, even as economy measures, is a bit like Tony Blair saying he supports the tax increases on the rich - which, incidentally, he has made clear he does not.

There is something tragic in this turn of events for a Prime Minister who made such a virtue of his "moral compass" when he took over. Most of us thought that Gordon Brown really was a "pretty straight kind of a guy", to echo Tony Blair's self-assessment, and that he had roots in Labour's social democratic traditions. "Best when we are Labour", as he said at the 2006 Labour conference. Everyone in Westminster knew that Brown had long supported a 50% tax on higher incomes but had been over-ruled by Blair. Similarly, his deafening silence on the Iraq war and on Trident replacement before he took over from Tony Blair gave many the impression that he was not thirled to Blairite defence policy either.

Perhaps if Brown had really followed his moral compass, and had had the courage of his convictions, he might have been able to renew the Labour project when he took office in the same way that Barack Obama has changed the climate of opinion in America. Brown could have taken the initiative and offered to put Trident on the negotiating table, not just to save money, but to stop nuclear proliferation. It is no longer the cold war shibboleth it was in the 1980s.

Last week's Budget tax increases looked like a political tactic designed to wrongfoot David Cameron by making him support the super rich. Yet it has been highly popular with a public which is sickened by the wealth and irresponsibility of bankers such as Fred Goodwin.

If Brown had raised taxes as a matter of principle, he might have been on to a winner; unfortunately, it has been seen as just another exercise in the politics of spin.

The McBride e-mails affair confirmed that, as far as the black arts are concerned, Brown is no different from his predecessor, and possibly a lot worse. No-one believes that he didn't know what his closest aides were up to.

And now, incredibly, the expenses scandal has landed on the No 10 doorstep, with Brown appearing to defend the indefensible. This is doubly ironic, since no-one believes that Brown is remotely corrupt or sleazy. If only he had approached the allowances question as a moral issue, and declared upon taking office that he would make Westminster as honest as Holyrood, he could have been the PM who cleaned up parliament. Instead, it looks like the Tories who will clean up at the next General Election. I don't know about New Labour, but it looks like Gordon Brown RIP.