Democracy works, however imperfectly. It is a commonplace that democracies make governments responsive to the peoples’ wishes and demands. They allow for the argument, dissent and deliberation that produces better decision-making. But they do more. They have a capacity for self-correction, renewal and national reinvention. They express the deep wisdom of crowds. They force governments to confront today’s economic and social realities with today’s ideas and nostrums.

British politics – and the country – faces a democratic conundrum. The universal consensus beyond Number 10 is that an exhausted Labour government is facing electoral disaster led by a man unsuited to the task of prime ministership. The Norwich byelection result is but a harbinger of the annihilation that is to come. Gordon Brown has a habitual capacity to overclaim and dissimulate. He believed his own propaganda about escaping boom and bust and bought the neoconservative ideology that financial markets were innovatively efficient, so helping stoke a wild credit boom, a failure he still does not publicly recognise.

Worse, for a democratic politician, he is a lecturer and a bludgeoner rather than an arguer and a persuader. To argue, persuade and lead, you have to respect those with different views whether inside or outside your party. This is not his instinct; instead, he relies on a toxic inner circle to help him dispatch opponents by fair means or foul, as a lengthening list of able former colleagues is testimony. It is a tribute to the Labour party’s death wish that it has not the courage to unseat such a leader.

Other truths will surface over the next 10 months. The essence of democracy is alternative governments. After 13 years of New Labour, the country is ready for change. But the question it will and must ask is whether David Cameron’s Conservatives are the answer to Britain’s problems. To jump from the frying pan into the fire would be stupid. Brown, like the tortured heroes of Shakespearean tragedies, is complex: he has strengths that partly compensate for his all too obvious flaws. One strength is that he is assembling an array of policies that are right. This, along with his astonishing tenacity, makes it so hard for his party to junk him. And here’s the rub. The country may find it has the same difficulty.

One of the Conservative party’s problems is that it does not have the intellectual, political and philosophical wind at its back and it has no surefooted sense of what it should do as the economic and social crisis unfolds. Thus Boris Johnson’s London mayoralty in which little positive has been done. As somebody close to him acknowledged admiringly to me, Boris is the classic Tory. It is as important to occupy power, so denying its use to others, as to do anything constructive with it. That may excite Tory camp followers; others may feel that the point of power is to use it.

The size of the prospective budget deficit has given the Tory leadership a new confidence. The Conservatives’ task is to do what comes naturally: to take an axe to public spending and the regulatory arms of government like OfCom or the Financial Services Authority that displease the Tories’ natural constituencies, whether Rupert Murdoch or a stage army of City traders. Yet under Adair Turner, the FSA has begun to get serious about insider trading, investment banker bonuses and the structure of banks’ business models. Just as it gets its act together, it is to be disbanded and its powers handed to what City minister Paul Myners calls the “bookish” Bank of England, whose record of both spotting asset price bubbles and handling bank crises is dire. Thinking City people concerned about the dominance of speculative finance are shaking their heads in disbelief. Equally, Sky’s competitors and many consumers are no less dismayed that a champion of competition is to be abolished.

Giles Wilkes, chief economist of the Liberal Democrat-leaning thinktank CentreForum, writes in an excellent overview of the current crisis (“A Balancing Act: Fair Solutions to a Modern Debt crisis”) that, while it was right to be tough on public spending and public deficits in 1979, it would be disastrous today. He argues that an economy beset by large private debt, low inflation, negligible private sector demand, collapsing asset prices and a broken banking system faces very different problems to the British economy of 1979. The growth in public debt that the Tories decry has been essential to heading off a full-blown depression.

It is tragic that Cameron and George Osborne have been seduced into primitive Samuel Smiles Thatcherism. They, like Brown, are more complicated than their cartoon depictions. Both have been brave enough to ask tough questions about the priorities of British capitalism and to have tried to open up a debate about how civil society as much as the state should address Britain’s social problems. Now they have regressed to simple anti-state, budgetary conservatism at just the wrong moment.

For over the last few weeks, the subterranean balance of the deep argument has begun to swing back to Brown. As Wilkes says, he got it wrong during the boom, but his fiscal strategy is now right. Brown’s document, “Building Britain’s Future”, is only halfway there, but it is the right trajectory. It was an achievement to persuade both Nissan and Toyota to step up their investment in electric car batteries and hybrids in Britain. It is right to begin the electrification of the railways. He is right to defend the FSA. Although much criticised, Britain must afford the big deficits until the economy plainly bottoms, when it will be right both to raise taxes and then slow spending growth. But not until then. Brown is right to insist there is a fundamental difference of strategy and Osborne and Cameron would have been cleverer not to have allowed this gap to open.

Will they really risk intensifying recession? Will they risk a second financial crisis that would bankrupt the country by mismanaging financial regulation? Do they have a strategy for building the economy? Will Britain leave the EU? These are big questions and in democracies cannot be avoided. If Labour was led by a charismatic leader sure of his or her ground, it would beat this Conservative party. Even with Brown, the Tory margin of victory cannot be taken for granted. There is a deep wisdom in democracies. They tend not to elect governments who will do the wrong things.