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British Prime Minister Gordon Brown announced Monday he will step down as leader of the Labour party by September. The announcement comes after several days of post-election wrangling, since neither Labour nor the Conservative party has enough seats in Parliament for a majority. The Conservatives, who won the most seats, have been courting a third, smaller party, the Liberal Democrats, to form a governing majority. Now it has been revealed, however, that Labour is in its own negotiations with the Liberal Democrats. Gordon Brown's resignation would assist these negotiations by removing one of the stumbling blocks in Labour-Liberal Democrat talks.

This isn't a matter entirely irrelevant to Americans, either: markets are expected to react strongly to the outcome, and with sovereign debt issues gripping Europe right now, the Conservative party has been favored for its deficit-reduction platform. Could Brown's resignation announcement turn the election into a bizarre eleventh-hour win for Labour? Could they steal the coveted Liberal Democrat coalition from Conservative rivals at the last minute?

  • Obstacle Removed¬† "Brown's resignation had long been a requirement from the Liberal Democrats to form a coalition with Labour," explains Chris Bowers at Open Left. "And so, right on cue, the resignation announcement also said that Labour was opening formal talks of an alliance with the Lib Dems."
  • New Leader of Labour¬† The search for Brown's replacement, "who could potentially lead the next UK government, will begin with a certain focus on David Miliband," the current Foreign Secretary, writes Business Insider's Gregory White.
  • Could Go Either Way¬† The "Tory-Lib" (Conservative-Liberal Democrat) team "would have a much stronger majority--and would match the public perception that the Conservatives won the election," writes the Financial Times' Gideon Rachman. But at the same time, "Labour seem to be offering the Lib Dems a much better deal than is on offer from the Tories," including "electoral reform and a move to a system based on proportional representation--this is the Holy Grail for the Lib Dems." They're also offering cabinet seats. But then, too, perhaps Clegg, leader of the Liberal Democrats, is only entertaining the Labour offer in order to improve the offer he's got from the Conservatives. Rachman decides his "money has now switched to the formation of a Lib-Lab government, with David Miliband as prime minister by September."
  • Signs Not Good for Labour, warns Diane Abbott in The Guardian, who says Brown being "forced out" will give supporters of Tony Blair, Labour's old leader, a welcome sense of revenge. There have been rumors that Labour and the Liberal Democrats had been in negotiations about the Brown-out, David Miliband-in switch "ever since the election campaign began." It's not clear how it will work out, Abbott says, but:
What we do know is that the Labour movement has been here before. As before, it was precipitated by a huge international economic crisis. As before, the narrative was all about the national interest. And as before, ordinary people were shut out of the dealmaking. It was the national government of 1931. And it destroyed the Labour party for a generation. This time it could be for good.

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