Boost for Brown faces recession test

LONDON (Reuters) - Prime Minister Gordon Brown has won acclaim for leading the international response to the financial crisis but his newly won popularity with voters could be severely tested by a looming recession.

Brown casts himself as following in the footsteps of British and U.S. wartime leaders Winston Churchill and Franklin Roosevelt in demanding action to tackle a financial crisis that brought the world's banking system to the verge of collapse.

After months of patchwork, ineffective efforts to halt a disastrous slide in confidence in financial markets, elements of Brown's multi-billion-dollar plan have been copied by the United States and Europe, holding out hope of stopping the rot.

"Mr. Brown and (Chancellor) Alistair Darling have defined the character of the worldwide rescue effort, with other wealthy nations playing catch-up," Nobel prize-winning U.S. economist Paul Krugman wrote in The New York Times.

French daily Le Monde referred to Brown, only slightly tongue-in-cheek, as "the magician," underlining the irony of the former champion of globalisation and market deregulation "giving lessons on interventionism to the continentals."

At a briefing for foreign media on Tuesday, Brown was bombarded with questions about how it felt to be a hero.

Asked by a Swedish reporter whether he was "Flash Gordon," after a science fiction comic-strip hero, or just Gordon, Brown smiled and said: "Just Gordon, just Gordon, I can assure you."

His words echoed a Labour Party slogan from 2007.

The worst financial crisis since the 1930s has come as a visible relief to Brown, after months in which a lack of direction on domestic policy and mounting economic woes sparked a rebellion in his party and a slump in his popularity.

Just a month ago, the Conservatives hit a 28-point opinion poll lead over the Labour Party, enough to give them a crushing majority if repeated at the next general election, which Brown must call by mid-2010.

COMFORT ZONE

Brown, who took over from Tony Blair as prime minister last year after a decade as chancellor, has rarely looked at ease in his new role -- until now, when the crisis allowed him to return to his financial comfort zone.

As the turmoil deepened, Brown acquired a spring in his step, travelling to Paris to brief eurozone leaders and coming up with a sweeping plan to use taxpayers' money to inject new capital into British banks and free up clogged lending.

Talk of a challenge to Brown's leadership disappeared as the Labour Party united behind its leader.

"Anybody who did have reservations has seen how well he has handled this appalling situation. He has kept his nerve, he has networked effectively internationally, he has come up with some answers," Labour legislator Graham Allen told Reuters.

The opposition parties, aware of the pitfalls of indulging in politics during a national emergency, toned down their criticism and promised to work with the government.

All that has helped Brown slash the Conservatives' lead to about 10 points in recent polls -- not enough for him to stay in office but a marked improvement nevertheless.

But analysts say the boost to Brown's popularity may not last long.

Simon Tilford, chief economist with the Centre for European Reform think-tank in London, said Britain was still on course for a deep recession.

Once unemployment begins rising sharply, "I think it will prove a very short-lived pick-up in his popularity," he said.

House prices are falling fast with no end in sight and inflation hit a 16-year high of 5.2 percent in September.

Julia Clark, head of political research at pollster IPSOS MORI, said it would be a "real challenge" for Brown to sustain the bounce. Once the immediate crisis was over, a "blame game" would start over who was responsible, she said.

An early test of the Brown bounce will come next month when Labour defends a parliamentary seat at Glenrothes in Scotland, attempting to end a run of humiliating defeats this year at the hands of Conservatives or Scottish nationalists.

But for now, Brown's financial expertise carries weight with voters.

"I'm quite glad Brown's in charge because he seems to know more what he's doing than anyone else," said Henry Gogherty, a 22-year-old consultant from London.

"I think he's turned a corner. He now looks like he's in control whereas before he was a bit rudderless," taxi driver Tim Christian, a life-long Labour voter, said.

(Additional reporting by Matt Falloon and Golnar Motevalli)

(Editing by Giles Elgood)