A repeat of the 2008 crash is unthinkable

Gordon Brown’s warning that bankers could wreck the global economy again should be taken seriously

Gordon Brown’s revelations today about what it was like to be at the epicentre of the 2008 crash contain the terrifying warning that it all could happen again.

Nearly a decade later, people in Britain and countries around the world are still living under policies of austerity introduced to help fund the multi-billion-pound bailouts required to save banks that the thenprime minister and other world leaders deemed were too big to fail.

The cost – in human terms as much as financial – had such central pillars of the global economy been allowed to collapse can only be imagined; in fact, it really doesn’t bear thinking about. Mr Brown, who said he would have resigned had the bailouts not worked, was surely right to prevent this from happening and should be given credit for taking the undoubtedly tough decisions involved.

But it should also be remembered that the crash was a massive failure of regulation – the sort of red tape that politicians sometimes rail thoughtlessly against. Bureaucracy can stifle economic growth, but some rules are there for good reason. Or should be.

Along with his colleagues in government, Mr Brown, the politician who thought he could abolish the cycle of boom and bust, was badly found out and cannot escape some of the blame for the catastrophic events that unfolded on his watch, particularly given the amount of time he was in office.

However, one should not perhaps be too harsh, given that few saw what was coming.

It would be difficult to be too harsh on the bankers, especially given Mr Brown’s recollection that Fred Goodwin, of RBS shame, used a private jet to go boar hunting in Spain among a string of other excesses.

The industry’s worst offenders, Mr Brown suggests, should have been sent to prison and the failure to do so might lead to similarly reckless actions in the future. He also cautions the banks that were too big to fail in 2008 are now even bigger.

Mr Brown’s fears should be taken seriously. This, after all, was a politician not just with a ringside seat as events that have defined the subsequent decade unfolded – he was one of the competitors in the midst of the action.

But bankers should be in no doubt about the level of public anger in the event of a crash of anything like 2008 proportions being caused by their actions.

It would not be pretty.