WI : UK economy collapses in 2008 ?

[kspence92]

This might sound ASB but Gordon Brown and Alistair Darling considered such a possibility.

This is from the Telegraph

On the evening before he was due to announce the part-nationalisation of UK banks, the former prime minister told his spin doctor he feared there would be riots on the streets if people weren't able to access their money.

Fearing there would be widespread looting of shops, he raised the prospect of declaring martial law.

Mr Brown said: "If the banks are shutting their doors, and the cashpoints aren't working, and people go to Tesco and their cards aren't being accepted, the whole thing will just explode.

"If you can't buy food or petrol or medicine for your kids, people will just start breaking the windows and helping themselves. And as soon as people see that on TV, that's the end, because everyone will think that's OK now, that's just what we all have to do. It'll be anarchy.

"That's what could happen tomorrow. I'm serious ... We'd have to think: do we have curfews, do we put the Army on the streets, how do we get order back?"

This is from Alistair Darlings interview with This is Money

‘I remember being summoned out of the meeting to talk to Tom McKillop and he said things were just terrible, that money was pouring out of the door.

‘He said, “What are you going to do about it?” Which I thought was a quite remarkable thing to say – what are YOU going to do about it!

‘I said to him, “We’re almost ready to go. How long can you last?” I thought he might say maybe a couple of days, and what really shook me was that he said, “Well maybe two or three hours and that’s it.”

‘What was in my mind at that point is that if people thought the biggest bank in the world had failed, there would not be a bank in the western world that would be safe.

‘The risk I have always seen is that people forget just how close we came to a complete collapse and the thing about a collapse of the banks is that it wouldn’t just have been the banks in ruins, it would have been complete economic and therefore social collapse. People without money can do nothing – you can’t buy your petrol, you can’t buy your food, anything.

‘It was rather like a nuclear war, you know you think it will never happen. And then someone tells you that a missile’s been launched. It was very scary. That moment will stick with me for the rest of my days.’

What if Britain's banking system, and subsequently much of our economy fell apart in 2008 ? How would the government react ? what would happen ?

 

[tonsofun]

I can imagine that far right parties will become a lot more popular than they are now. Immigrants will get the biggest share of the blame for it and the government would be forced to do something or at least appear to do so. The people at my work would be totally different if such action was taken. That makes me sad in a way.
Politically, I can imagine Gordon Brown would be even more hated than he is now and Labour would not see power for a very long time.

 

[Meadow]

I can imagine that far right parties will become a lot more popular than they are now. Immigrants will get the biggest share of the blame for it and the government would be forced to do something or at least appear to do so. The people at my work would be totally different if such action was taken. That makes me sad in a way.
Politically, I can imagine Gordon Brown would be even more hated than he is now and Labour would not see power for a very long time.

Brown's had a funny time of it IOTL. Many expected him to be truly loathed, but Clegg and the Coalition have really dampened the hatred he's got out of power. He's not in a case of 'come back, all is forgiven' (though I've heard those words from people who aren't particularly left wing), but he isn't universally hated anything like how he was when in office.

I think history will (rightly or wrongly) be kind to him, painting him as a tragic figure who was decent at heart but out of his depth for matters out of his control.

 

[dduff442]

Darling's analysis is backwards. The banking system did collapse. The whole system of accounts was revealed to be a forgery. What mattered was political power. Political power alone animated those zombies and political power alone determined what was worth what and who owed who how much.

Of course the banks always understood what "too big to fail" meant -- state subsidy for their borrowings in good times, and state obligation to their fraudulent accounts in bad.

 

[tonsofun]

Brown's had a funny time of it IOTL. Many expected him to be truly loathed, but Clegg and the Coalition have really dampened the hatred he's got out of power. He's not in a case of 'come back, all is forgiven' (though I've heard those words from people who aren't particularly left wing), but he isn't universally hated anything like how he was when in office.

I think history will (rightly or wrongly) be kind to him, painting him as a tragic figure who was decent at heart but out of his depth for matters out of his control.

I think history will look kindly on him. He really came in right at the wrong time. However, it still saddens me when I hear people say he caused the recession or failed to protect us from it. Luckily, I haven't heard that kind of talk in a while.