Conservatives – Page 7 – thinking liberal

What is the meaning of Richmond Park?

My (many) Liberal Democrat friends are ecstatic. The party has just won the parliamentary by-election in Richmond Park, overturning a massive majority from the sitting MP, Zac Goldsmith. As the dust slowly settles, what is there to learn about the state of British politics?

Richmond Park is quite close to where I live. I have been visiting it since the 1980s, helping out the local Liberals and then Liberal Democrats, including a few visits this time. It consists of the suburb of Richmond, together with a slice of Kingston, near Richmond Park, nearly up to Kingston town centre, and including the local hospital. The seat, and its predecessors, has been the scene of epic battles between Conservatives and Liberal Democrats. After a series of close results, the Lib Dems won it in the Tory collapse of 1997, with the rather eccentric Jenny Tonge as their MP (she kept testing the boundaries of what respectable politicians it could say about the Israel-Palestine conflict, transgressing on occasion – she has now left the party). She held the seat in 2001, but then stepped down. In the high water mark election of 2005 for the Lib Dems, which gave the party the illusion that seats that could be readily handed on from one candidate to another, the Lib Dems held the seat with Susan Kramer.

But in 2010 Zac Goldsmith, a local boy and inheritor of a substantial fortune, took the seat back for the Conservatives. He held it with a crushing majority (with 58% of the vote) in the Lib Dem meltdown of 2015, though the Lib Dem candidate, Robin Meltzer, managed to hang on to second place with 18% – a feat that could by no means be taken for granted. Many Lib Dem activists sighed and suggested that the influx of rich voters meant that the seat was gone for good.

But Mr Goldsmith was an independent minded MP, who had campaigned hard against the expansion of nearby Heathrow airport – which blights an area that otherwise offers sites of outstanding beauty. This is necessary for anybody that aspires to be an MP there. When the Conservative government under the new prime minister, Theresa May, finally opted to expand the airport, Mr Goldsmith fulfilled a campaign promise by resigning and standing as an independent. But the Conservatives did not put up a candidate against him, undermining his claim of independence.

Notwithstanding the mountain that the Lib Dems had to climb, expectations on the party were high. They had surged in the Witney by election, and a similar surge might take the seat for them. The Lib Dems had been doing well in local by elections (as well as Witney) over the summer, though their national poll rating remained dismal. To prove that that this improved electoral performance had substance, many commentators suggested that it was an election they had to win. All Liberal and Liberal Democrat revivals since 1945 had been led by spectacular parliamentary by election wins. If not here, where was that boost going to come from?

But Mr Goldsmith had clout on the issue that triggered the election: Heathrow. The Lib Dems had campaigned just as hard on the issue, and the government’s decision had proved the party’s contention that the best way to prevent the government from pressing ahead was for a strong Lib Dem party in coalition. Five years of coalition had held off the considerable political pressure for expansion. (Though Lib Dems might want to ask themselves why the party showed backbone on Heathrow, but not student fees). Barely a year of even a small Conservative majority and the resistance to expansion folded. But that’s a subtle argument, and the Lib Dems needed something bigger to shift enough votes their way. And so they campaigned on Brexit. Mr Goldsmith is a prominent supporter of hard Brexit, while the constituency voted 69% to remain in the EU. That did the trick.

What does this mean? Let’s start with the red herrings. First it says nothing about the state of play in Britain’s battle over Brexit. One of the strongest Remain constituencies voted for an anti Brexit MP. That does not change the calculations for a large majority of MPs, whose constituents voted to leave. What would change the nature of the debate is a large number of Brexit voters changing their mind. With 45% of the electorate still voting for Mr Goldsmith, there was no sign of that.

A second red herring is that the collapse of the Labour vote (they lost their deposit, polling less than their party’s membership in the constituency). This is what happens in this sort of by election, and says nothing about the party’s chances in a future general election. A resurgent Lib Dem party could be a worry, but Labour still holds the aces, and this should not be a problem for a half-way competent leadership. Indeed if the Lib Dems draw off Remain voters from the Tories, it could help Labour. That Labour voters can be persuaded to vote Lib Dem tactically does not hurt Labour at all. The reversal of this trend in 2015 was a disaster for Labour.

The first lesson I would draw is that the Lib Dems have nailed their colours to the pro-EU mast. That seems to cover about a quarter of the electorate, a big enough pool for the party to fish in in its current state. It answers the question “what is the point of the Lib Dems?”, as the Tories adopt Brexit as their own, and Labour collapse into muddle. Those Lib Dems, like me, who are inching towards some form of reconciliation will have to bite their tongues. We need to understand that this is the best way of that the party can demonstrate its open, liberal values and present itself as a bastion against the rise of nativism and intolerance. It does not quite answer the question of whether the party is going for a core vote strategy, though. If the party gets the by election bug they will be tempted to water the message down in pro Brexit constituencies.

The next lesson is that organisation matters in British politics, and that the Lib Dems still have it. It was possible to feel sorry for the Zac supporters, overwhelmed by a blitz of Lib Dem literature and canvassing, while not having adequate data themselves. Many of them felt shell-shocked, and the graceless Mr Goldsmith whinged about being crushed by a machine. This delighted Lib Dem activists. Having been written off in 2015, after being crushed by a ruthless Tory machine, to be accused of being a ruthless machine themselves is a compliment indeed. The party pulled together, mobilising old members and new, in an optimistic, cheerful campaign, led by their candidate, Sarah Olney, who only joined the party in 2015. Both Labour and the Conservatives, with their bigger and better party machines, will take note, and will not be too upset. Breakaway parties, such as some Labour members were contemplating earlier in the year, look as hopeless an enterprise as ever. Lesser parties, including the Greens and Ukip, are presented with a big challenge.

A further point of interest comes from the fact that Ukip and the Greens did not put up candidates, and instead deferred to Mr Goldsmith and the Lib Dems respectively. The former reflects Ukip’s current turmoil, and the party is weak locally – it has created no debt on the Conservatives. The Greens’ move is more significant. They too were in a weak position, and faced being crushed by the Lib Dem juggernaut, as Labour were. By pulling out they made a virtue out of this weakness and will have softened the attitude of Lib Dems to do electoral deals with party in future, as part of a “progressive alliance”. Under Britain’s first past the post electoral system this kind of dealing is a logical response that may well take hold. Labour came under quite a bit of pressure from many of its members to do the same. There was never much chance of this from the still very tribal Labour party with its weak leadership – and Lib Dems will be relieved. They do not want to be under any kind of obligation to Labour under its current leadership.

What we don’t yet know about this election is whether it will boost the Lib Dems national standing amongst the public. The media is starting to take the party more seriously, but it will be some time before we have enough polling evidence to tell. What is clear is that the party is in fighting form, and has a much greater political weight. That is good news for supporters of liberal values, for which it is the clearest upholder on the British political scene. If Labour and the Conservatives can take their reluctant liberal supporters less for granted as they face the challenge of the populists, it will make all those efforts by the party’s volunteers worthwhile.

The Tories take possession of Brexit; the Lib Dems will benefit

Theresa May, Britain’s prime minister, closed the Conservative Party conference yesterday with a striking vision of her political direction, which was consistent with speeches made by other members of her government. This is a marked change of tone from her predecessor, the rather liberal David Cameron, and his Chancellor, George Osborne. Brexit is at the heart of it.

Earlier this week, FT columnist Janan Ganesh suggested that the stream of social policies coming out of the Conservatives were an attempt to deflect the politicians’ obsession with Brexit. But this is to misunderstand what these policies are about – they are an attempt by the Conservatives to tell people that voted for Brexit that they “get it”. The vote to leave the EU is the starting point of the whole thing.

What Mrs May is trying to do is to adopt what I will call the “Brexit coalition” as a political base. This starts with her hinterland: the non-metropolitan middle classes – most especially their older members, as their children are going to university and becoming more metropolitan in outlook. This group has a nostalgic view of the past, and feel threatened by the cultural aspects of globalisation. All the talk of patriotism, the hard line on immigration and the attacks on liberal elites (Oh how sick I am of being told that I am part of a ruling elite when all I am is a school governor!). Other nostalgic policies, like promoting grammar schools are in the mix too.These are bedrock Conservatives, largely taken for granted by Mr Cameron.

What is more interesting is that Mrs May wants to add the disaffected working classes, who voted in droves for Brexit, notwithstanding the advice of the Labour Party. They share the cultural biases of the non-metropolitan middle classes, but add to this resentment about economic insecurity. Mrs May is making a particular pitch for this group: emphasising the struggles of people at the margins, though failing to observe how much austerity policies, such as changes to tax credits, have added to their hardship. For these people she made a strong pitch for “fairness”, and indicated that she would act on a series of economic problems, like housing costs and poor infrastructure. She also rounded on unscrupulous businesses. In parts she sounded not unlike Ed Miliband, Labour’s previous leader, allowing her to claim the “centre ground”. Strikingly she also included a pitch for ethnic minorities, acknowledging discrimination. Ethnic minorities make up large sections of the working class, after all – though the Brexit voters tend to be “I’m not racist but…” types who think it is them who are the victims of discrimination.

But one part of the Brexit coalition is being left behind by all this: the businessmen who called for a bonfire of regulations to make businesses more competitive. On the one hand Mrs May’s tough line on sovereignty, immigration and foreigners points to a hard Brexit, and so little need to heed EU regulations. On the other the threatened policies to limit immigration would add a very hefty layer of extra bureaucracy on businesses, and the appeals to “fairness” suggest a strong role for regulation and government intervention too. Regulation and democracy go together like a horse and carriage. They may be jumping from the frying pan into the fire. But this part of the Brexit coalition always mattered more for its money than its voter appeal.

It is possible to admire the political cleverness of this. Ukip, who had been harrying the Tories on their nativist flank, are struggling at the moment, and this sort of thing should see them off, in Conservative constituencies at least. One might ask what the point of Ukip is. It also takes advantage of Labour’s disarray. At their own conference Labour failed to discuss Brexit. Their leader, Jeremy Corbyn, seemed to embrace it – but (admirably) failed to bang the drum on immigration. Other Labour big hitters want it the other way round: oppose or soften Brexit, but wave the flag on immigration. This leaves muddle at the core of Labour’s message on the top issues of the day. The party will no doubt maintain its iron grip on public sector workers, and those vulnerable to government reforms (students, benefit claimants, etc.). I would also be very surprised if their grip on ethnic minority communities was seriously dented. But this falls way short of an election-winning combination. It is not clear what is their appeal to grumpy working class voters, to say nothing of the non-metropolitan middle classes that former Labour leader Tony Blair made inroads on the last time Labour won an election.

But speaking as an ordinary decent liberal and proud citizen of the world (subject to a sneering jibe in Mrs May’s speech), I am aghast at the direction the Tory Party has taken. The are stigmatising foreigners and implying that I am unpatriotic. Many of us are friends, neighbours and work colleagues with people who are not British citizens, and we look on them as equal human beings who have earned our respect and a place in our society. I find that impossible to reconcile with some of the rhetoric coming out of the Conservative Party. And it gets worse. The EU referendum unleashed a wave of hate crime and anti-social behaviour aimed at people who are seen as not belonging here (not just foreigners of course). Much as the leaders of the Brexit campaign claim that this is nothing to do with them, Conservatives run the risk of allowing these attitudes to take root, even as they claim that it is not their intention. In the same way Mr Corbyn will not call off the misogynistic hard left thugs that are part his own coalition, contenting himself with mild disclaimers.

This is now becoming a real political opportunity for the Liberal Democrats. The party is now the best home for open-minded people who do not have a nativist outlook – or those of them appalled by developments in the Labour Party anyway. It becomes easier for the party to take credit for the better bits of the coalition years – which had accrued to Messrs Cameron and Osborne – rather than just the blame for the bad bits.

That opportunity for the Lib Dems will grow if the Conservatives fail to deliver on their new promises, as seems almost certain. As soft Brexit turns into a mirage, and hard Brexit turns out to be highly disruptive, and as the Tories fail to deliver economic gains, such as lower rents and better paid jobs, to working class and other struggling communities, and as the party’s small parliamentary majority bogs it down, then the appeal of Mrs May’s government will diminish. With Labour looking like an empty bubble of hope (or a pyramid scheme as suggested by the Economist’s Bagehot column), there is reason for the Lib Dems to gain.

Of course, the Lib Dems themselves have many serious questions to answer. But it may be easier than people think for it to double its vote share to 15-20% before coming under more serious scrutiny. As the keener Lib Dem activists travel to the latest by-election in Mr Cameron’s old seat in Witney, Oxfordshire, it is impossible not to notice the spring in their step. The bookies are already giving them second place (from fourth in 2015).

But this is a small shaft of light in a very gloomy British political landscape, as the wonton act of self-harm committed by its electorate in the referendum pushes events on a seemingly inevitable course.

The housing crisis is an opportunity for the left.

“A Britain that works for everyone.” This is what Britain’s Conservatives say they want to achieve under the new prime minister, Theresa May. Partly, of course, this talk is meant as an attempt to divert attention from the difficult choices implied by Brexit. But there is an issue that is slowly coming to dominate the life-chances of “everyone”, and could be even more important than Brexit: housing. Or to give this a bit more precision: the high cost of buying or renting residential property. In order to fulfil their slogan, the Tories will have to make progress on this. Will they?

What brought this home to me last week was a report that people born in the 1990s (the so-called millennials) are worse off than those born in the 1980s at the same time in their lives. This is startling for a society that has, generally speaking, benefited from economic growth over the last 30 years, and where educational standards are rising. And the reason is easy to see: compared to people born even ten years earlier, many fewer millennials can afford to buy their own homes. They are unable to benefit from a general rise in property prices that has proceeded apace over that 30 years. Meanwhile rental costs have gone up too, which only makes the gap wider. This phenomenon does not just apply to Britain’s overheated southeast – it afflicts most major urban centres, to say nothing of popular university cities like Oxford and Cambridge.

Why is this such a big issue? The millennials themselves are not particularly important electorally, especially as so many of them show little interest in the political process. But their troubles worry their parents. And the trend is evident from before the millennial generation. More importantly, the generations following the millennials will be equally deprived. The numbers of property have-nots are growing, and property wealth is being concentrated into a smaller number of hands. High rents is a cause of hardship for ever increasing numbers of people – and a cause of rising homelessness, with all the other problems that brings in its wake.

Politicians are increasingly aware of this. Conservative leaders are talking the talk. Mrs May has appointed a new cabinet level minister of housing, Sajid Javid, who talks of a moral crisis. All leading politicians talk grandly of building many more houses. But there are two political problems, which are linked. The first is that the crisis arises from a profound failure of market incentives. And the second is that any policy that actually works is going to hurt a lot of politically influential people. This combination presents a test for Mrs May that she is unlikely to pass. It is one of the few decent opening in British politics for the left.

First consider market forces. Read The Economist and you might think that the housing problem is quite simple at heart. It is a failure of supply to meet the increased demand for housing from a rising population and changes to lifestyle that mean more people want to live alone. And there is a ready culprit for this: restrictive planning laws and NIMBYs who resist new housing developments, which between them surround our cities with over-protected green belts. This glib explanation contains some truth, but it misses two awkward points: much land where development is permitted is not being developed because owners would rather wait – “land banking”; and loose monetary policy has pushed up the cost of housing regardless of supply and demand.

Consider the first point. Property developers profit massively from increasing property prices. Indeed, it is central to their business model. They like to build cheap houses to maximise their profits from land trading, fighting furiously any regulations that might make homes more thermally efficient, for example. It is not in their interests to increase supply to levels where the value of property starts to come down. For all their moaning, they are quite happy with the situation as it is – though they would love to get their hands on green belt land with permission to build, and bank that too. A similar logic applies to rental values, since so many new properties are bought to let. The economic incentives do not point to the private sector solving this problem by themselves. In fact many private sector actors are likely to oppose any policy that actually bites, since that means cutting rental and sale values.

The effects of monetary policy are less understood: by this I mean the way governments and their central bankers have had no real qualms about rising levels of debt used to finance private house purchases. This has been happening since monetary policy was let off the leash by the collapse of the Bretton Woods system of fixed exchange rates in 1970. The extra monetary demand for housing set off by this increased availability of finance has not been matched by an increased supply of housing. Indeed it is about this time housebuilding slowed down. Easy money has simply led to the inflation of land prices.

To illustrate this, look at this graph of the ratio of house prices to earnings from Wikipedia (By D Wells – Own work):

We should expect to see house prices rising in line with earnings, given its relatively limited supply. We can see that the ratio of prices is tied closely to monetary conditions. Monetary conditions were loose in the late 1980s (the Lawson boom), but had to be tightened as inflation started to get out of hand. That caused a crash that is seared into the memory of older Tory politicians – the years of negative equity. Then things eased, with the mid to late 1990s and early 2000s being years of easy money. The financial crash of 2008 tightened things up, but now conditions are loose again.

Of course easy money and land-banking are self-reinforcing. If property prices dip, property developers can be confident that monetary conditions will ease and come to their rescue.

If I am right about these two problems lying behind Britain’s housing crisis, the solution is quite easy to see. First there needs to be a massive public-sector house building programme, including a large proportion of good-quality social housing, available at rents well below the current market level. This is best done by local and regional authorities, and financed by allowing them to borrow much more. This would put downward pressure on rents, which is perhaps the most urgent aspect of the housing crisis. It would also make it much easier to tackle homelessness.

The second thing that needs to be done is to tighten monetary policy. This may be by using some form of quantitative control on housing debt, but it may also mean raising interest rates. The main idea would be to encourage banks to finance local authority housebuilding, rather than private mortgages. This will require political courage, as it means, for a time at least, property prices falling without making property more affordable (since it will be harder to get finance) – as happened briefly after the crash of 2008/09.

The good news is that the first of these two groups of policy is fast becoming consensus on the left – sweeping in Labour, the Greens and the Liberal Democrats. And yet it will be very hard for the Conservatives to stomach. They associate social housing with left-wing voters. It may also upset NIMBYs where the estates are to be built, to say nothing of hordes of people who have invested in property to let – all natural Tories. Tory politicians talk freely of raising large sums of money to push house construction forward. But I have not heard any talk of giving a serious boost to social or public sector housing, or giving local authorities more freedom. It sounds horribly like subsidies for the private sector that will end up by inflating prices and developers’ wallets further.

On the second issue – reducing the volume of private housing finance – I see little sign from anywhere in the political spectrum of this being taken up. This is unsurprising. It would mark a profound change in economic management, which is heavily based on monetary policy. And change would cause outrage in Middle England, attached to its property values. And yet the current way speaks danger. It is increasingly dependent on ever increasing property prices, as these lose touch with incomes. It is a bubble that will surely burst at some point. Even so, I am sure that the left is closer to this policy change than the right. One implication is that more of the load of economic management will be taken by fiscal rather than monetary policy. The left is much more comfortable with that, though I suspect few have taken on that it means supporting austerity at the top of the economic cycle.

Mrs May talks much of making life better for the hard-pressed in our society. Lower rents are surely by far the best way to achieve that. Does she and her party have the stomach for it? If not, the left will have its chance.

The Lib Dems mission must be to pick up disillusioned Tory voters

Not so long ago the idea of a “progressive majority” was popular amongst leftish intellectuals. They noted that if you added together the poll ratings, and even general election votes, of Labour, the Lib Dems, the Greens and (for some people) the Scots and Welsh Nationalists, there was a clear majority of the electorate, outnumbering the hated Conservatives and Ukip. This majority was regarded as a state of nature, and so, it was argued, proportional representation would lock it into the political system for good.

It was always optimistic. Both Labour and the Lib Dems drew voters who would happily support parties that were not “progressive”. This word is left’s own favoured description for itself. Since, in practice, most “progressives” oppose any kind of reform to make the state or the economy more efficient, I really can’t bear not to place it in quotation marks when it is used to represent the broad left, rather than those who genuinely favour ideas that stand for the positive progress of society..

The flaw in the progressive majority idea is now open for all to see. In the 2015 General Election the Conservatives and Ukip outpolled the “progressive” parties. And that is before any disqualification of the Lib Dems after they entered coalition with the Conservatives. And if that wasn’t enough, the clear majority for Brexit, not supported by the “progressive” parties, confirmed it. Most parliamentary seats for “progressive” parties voted to leave the EU.

This is a fact that the far left (I almost used the word “radical”, but once more the word would be seriously misplaced for a bunch that includes so many people nostalgic for the 1970s). Many are convinced that Labour did so badly in 2015 because it was not left wing enough, with its half-hearted embrace of austerity. Challenged, they suggest that there is an army of disillusioned non-voters who could be drawn into voting for a party of the true left. Certainly there are a number of under-30s that could fit that description, but not enough. In fact most people who explore the polling data suggest people who do not vote are often less-educated and supportive of populist right wing policies. The Brexit referendum was relatively successful in bringing these non-voters out, and they did not vote Remain.

And yet calls for a progressive alliance persist. The Labour left is sceptical, to be sure – to them Labour alone should be the progressive alliance. But many Greens and Lib Dems would contemplate ganging up with other parties in order to push forward progressive reforms. These include constitutional and electoral reform, sustainable economics, and stronger environmental protection. In principle I would support such an alliance, but only with a Labour Party genuinely committed to political pluralism – which rules out the current leadership.

And yet, even if Labour could be brought into the picture, the numbers don’t add up, even if the SNP could be brought into it. An alliance would need to present a serious challenge to the Conservatives in English constituencies. Labour and Green support might help the Lib Dems recover some of their lost seats; the Greens might pick up one or two seats. But it is very hard to see how Green and Lib Dem support would give enough help to Labour. Instead it is more likely that the Tories would successfully exploit Labour muddle to destroy the whole alliance.

So, is it game over for progressive politics? Not quite. Brexit may have won the referendum, but Remain still managed 48% of the vote. But that 48% includes a lot of people who normally vote Conservative. If a way can be found to peel these voters away into a progressive alliance, then it could be back in business.

And it isn’t hard to see what might do this. The Prime Minister Theresa May is enjoying a political honeymoon, but her party is at sixes and sevens over Brexit. It is not at all clear what shape a post Brexit Britain will take because her party is hopelessly divided on it. The moderates want to create a cosy relationship with the EU, in order to protect investment and the economy. But the Eurosceptics that make up so much of the party will not stomach the compromises that entails. Meanwhile, if the British economy goes into recession, as many fear, the pressure on government finances will drive further division. It is not beyond imagination that the only way out will involve a second referendum.

The Conservatives might split under the strain. That is unlikely. As Labour will find out as its MPs contemplate their position, the pressures for the large parties to stay in one unit under Britain’s electoral system are huge. There are no safe seats for breakaway parties, and safe seats are most MPs have no real idea of how to fight a hard seat or the stomach to do it. But the splits will undermine the Tory credibility, giving the chance for other parties to take their votes.

And surely this is the historic mission for the recovering Liberal Democrats. Labour has lost interest in anybody that has contemplated voting Conservative (as both leadership contenders vie to prove how left-wing they are), and the Greens have never had it. There is nobody else to fill the vacant space. For once the coalition experience may prove a positive. That might then revive the idea of a progressive alliance, though the credibility of the Labour Party would be a major obstacle. It remains the best chance for progressive politics.

The Lib Dems are understandably focusing on their core vote, and not on scooping up flighty floating voters. But in order to achieve anything the party will have to return to appealing to these voters in due course. Disillusioned Labour voters will not be enough. The party will have to detach centre-right voters too. That should be food for thought for the party as it tries to redefine itself in British voters’ minds.

Was the coalition’s austerity policy a colossal mistake?

Politics is dominated by historical myths, about which the different political camps disagree. Examining these myths critically is one way that societies can find reconciliation. While “austerity”, the favoured shorthand for government cutbacks, is fast sinking as an issue in British politics, long since overtaken by Brexit, its mythology remains a defining issue. This mythology has right and left versions. I want to look at the mythology of the left.

Few in the Labour Party would disagree with Oxford Economist Simon Wren-Lewis in a recent article that austerity “will go down in history as probably the most costly macroeconomic policy mistake since the 1930s, causing a great deal of misery to many people’s lives.” We in the Lib Dems are implicated in this criticism, as part of the coalition government of 2010-2015 that implemented austerity. It is exhibit B in the Labour case that the Lib Dems should cease to exist as a political party, and that all “progressives” should simply join their party (exhibit A being the tuition fees fiasco). So what are we to make of it?

Mr Wren-Lewis sets out this narrative very clearly in his article. He is an open Labour supporter, so his comments come with a political slant – but he is a proper economist and the case he makes is a substantial one.

This narrative runs something like this: in 2008-2009 Britain followed the world into a severe recession, brought about by a global banking crisis. This inevitably created a government deficit, of which he says: “We experienced record deficits in 2010 simply because the recession was unusually severe.” The Labour government used fiscal stimulus to moderate the effects of the recession, but the Conservative-Liberal Democrat coalition that came to power in 2010 rejected this approach and focused obsessively (so the story goes) with reducing the deficit, using austerity policies – cutting government spending severely. He claims that this focus on austerity had no economic merit, and is best understood as a political exercise to reduce the size of government, with misery as its by-product.

Mr Wren-Lewis says that the government defended its policy with three arguments: that innovative monetary policy would provide the necessary stimulus; that improved business and consumer confidence would do the trick; and that financial markets would not finance the national debt unless action was taken. He demolishes each of these arguments, and I would not disagree with him, though there is an element of hindsight and the first two ideas came good in the end. As a result, he says, the British recovery was extremely slow, costing the average household £4,000 a year – coincidentally about the same as the Treasury’s estimate of the costs of Brexit.

But Mr Wren-Lewis is being disingenuous. There was a fourth argument for austerity. And that was that most of the deficit in in 2010 was “structural” – in other words had a deeper cause the recession. If I remember correctly, the Office of Budget Responsibility estimated that about 8% or so of the 11% deficit was structural. In other words a lot of the pre-crash tax revenues were gone for good, and would require more than short term demand management to bring them back.There is plenty of scope for disagreement amongst professional economists here – but it does suggest an alternative narrative, to which I personally subscribe.

This narrative posits that the British economy was not in a stable position when recession struck. It had already been pumped up by excess fiscal stimulus; there was too much private sector debt; and there was an unhealthy dependence on international finance and, to a lesser degree, North Sea oil. The evidence for this is not just the precipitate nature of the crash – bigger in Britain than in other developed nations – but the large current account deficit before, during and after the crash, and the high level of Sterling beforehand, and its abrupt fall. It is true that the public deficit did not look outsized by international standards before the crash, but, as my macroeconomics lecturer pointed out at the time, the overall economic context had classic signs unsustainable fiscal stimulus. The crash was more than an ordinary business-cycle downturn, it was Britain’s financial chickens coming home to roost.

So what does that mean? It means that fiscal stimulus as a response to the recession would have only a limited impact, and would not have restored the economy to its previous health, and in particular it would not have solved the government’s deficit problem. Before long the additional demand generated would have led to inflation (in fact unlikely outside economics textbooks) or (much more likely) a worsening current account deficit, i.e. stimulating other countries’ economies rather than ours. That put the British government in a bind. There was a case for stimulating demand through fiscal policy, and yet government expenditure had to be cut back towards something sustainable in the medium term. The government in fact plotted a middle way and, far from obsessively focusing on deficit reduction, moderated the cuts when the recovery proved slower than they expected. The trajectory of deficit reduction was close to that projected by the outgoing Labour government in 2010.

But many distinguished economists were and remain highly critical of the coalition’s austerity policies. Labour supporters can quote any number of famous names. But you need to read what these distinguished people actually said, rather than the mood music they fed into. In fact they hedged their bets. They focused criticism on the lack of public investment, and not across the board austerity. Investment, in theory anyway, is a magic bullet in this context. It generates future productivity growth, so helps to put the economy on a more sustainable future path, while at the same time providing short-term demand. This is a perfectly valid criticism of the coalition record, shared by many Lib Dems who were part of the government. But it does not suggest that the majority of austerity policies were wrong in principle. Taxes and spending were badly out of line and something had to be done to return them to balance. All I can say in the government’s defence is that public investment is much harder to do in practice than in theory – so often the money ends up in wasteful white elephant projects. But it would have relatively easy to allow the building of more council homes, for example.

Where I agree with Mr Wren-Lewis (though he does not explicitly say it) is that the macro-economic policy presented by Labour at the General Election in 2015, under Ed Balls and Ed Miliband, was much more sensible than the one presented for the Conservatives by George Osborne. Mr Osborne proposed a charge towards fiscal surplus that made little economic sense – and one year on it is being buried by his successor. The Labour strategy would have knocked some of the hard edges off austerity, while promoting a higher level of investment. The left is right to call to call it “austerity-lite”, but wrong to suggest that this was a bad thing.

So criticism of austerity is warranted, but this does not amount to what the left wants it to do: to prove that cuts to government spending and benefits were unnecessary, and still less that they can be reversed. Extra spending will require higher taxes. Economists may feel that austerity policies are self-defeating in many instances, such as in some of the Eurozone adjustment programmes. But there is also growing recognition of a deeper weakness in many advanced economies, including Britain’s, signified by the stagnation of productivity. That is limiting tax revenues and what governments can afford to do. That weakness should be the central topic of political debate.

Subjecting MPs to party membership votes is not democratic

Yesterday the Conservative leadership election resolved itself as the final Brexit-supporting candidate’s campaign imploded, leaving Theresa May unchallenged. Labour MPs look on with envy, as their own leadership election officially got started on the same day, as Angela Eagle formally challenged Jeremy Corbyn for the job.

What both these contests had in common is that party rules give the deciding say to a vote of party members. It is the same for all Britain’s political parties. Back in the 1970s, when I came to political consciousness, such contests would be decided by party MPs alone. The Liberal Democrats (or its predecessor parties – I can’t quite remember how this evolved) were the first to move to an all membership vote. In their case, the parliamentary party was very small, and the party outside parliament relatively much more important. Participation in the party’s policymaking and leadership processes were designed to encourage people to join. Lib Dem activists describe this membership participation as “democratic”.

As membership of all political parties went into steep decline in the 1990s and 2000s, the other parties followed suit. Labour has done this with particular enthusiasm. Not only do they now put the leadership election to a full membership vote, but they allow the public to join as temporary members to take part. This extends the franchise to hundreds of thousands of people. The result last year was that Mr Corbyn was selected in a surge of enthusiasm from party members, charmed by the apparent freshness of his approach. This was described by his supporters as “democratic”. They still do. On the radio I recently heard one of his supporters use the words “democratic” or “democracy” in pretty much every sentence.

But Mr Corbyn never had much support in the parliamentary party, and he has not succeeded in winning Labour MPs to his cause. They have rejected him in an overwhelming vote of no confidence. And yet he clings on as leader, claiming that his “democratic” mandate trumps the views of MPs. This use of the work “democracy” to assert the primacy of party memberships is an abuse.

At the heart of any democratic system is the participation the public, or rather, a public. This public is not defined by personal preferences, such as voluntary memberships, but by some involuntary common factor – such as where they live. Excluding people undermines democracy. This makes it a messy, rough and tumble process. Without some kind of preselection process, there will be disagreements on most things. Unanimity is near impossible on large populations. Party memberships do not fulfil any reasonable definition of being “a public”. People join voluntarily, according to some understanding of shared values; they are essentially self-selecting. They may use democratic procedures to make decisions, but that does not make them democratic. The Labour selectorate is of an impressive size compared to other political parties, but it is still tiny compared to the population at large, and in no manner representative of that population.

This is one of the paradoxes of large-scale democracy. Political parties are essential to a healthy democracy, but they are not themselves democratic. They can only claim democratic legitimacy when they subject their candidates to a public vote. And that creates a tension for publicly elected representatives between the party that nominated them and the electors that voted for them. That tension is as old as political parties. It is a tension that has to be managed rather than resolved one way or the other. If a representative (an MP, say) ignores his party, then he is disregarding one of the most important things the public knows about him. But if he ignores the broader electorate, he is holding them in even deeper contempt.

The tension comes to a head when it comes to selecting the party leader, a position of enormous privilege in our political system. The MPs have a proper democratic mandate, and their cooperation is required in order for a leader to be effective. But in order to secure the commitment of party members, also very important for an effective political party, they must be given a say. Labour’s system for selecting its leader (courtesy largely of Mr Corbyn’s predecessor, the well-intentioned but lightweight thinker Ed Miliband) is based on wishful thinking rather than hard political calculation.

To most observers, it is quite clear that Mr Corbyn should step down, as a loss of confidence amongst MPs is fatal. The Deputy Leader should take over temporarily, while an open leadership contest takes place. Instead Mr Corbyn seems to view his MPs as traitors to the political movement he represents, and is clinging on, with every reason to expect that he will see off the challenge. There is some question as to whether he should only be allowed to re-stand if he fails to find 51 MPs or MEPs supporting him. But if he does not stand, there will be a huge rift in the party at large. As it is many MPs face de-selection.

The Labour Party is in enough trouble as it is. It somehow needs to reconcile three constituencies: middle-class public and third sector workers; white working class voters; and ethnic minority working classes. The white working classes in particular were strong supporters of Brexit, and feel alienated by the other two groups. And the party’s collapse in Scotland shows that its continued strength is not an inevitable fact of politics, as it used to think. But instead of confronting this existential crisis the party will indulge in a narcissistic battle of abstract nouns (austerity, inequality, democracy, etc.). They should be engaging in the hard graft of rebuilding community relations; listening rather than shouting. The prospects for the movement do not look good.

The Conservatives, meanwhile, seem to have a much stronger grasp of political reality. There was no nonsensical talk of “democracy” concerning the abortive final vote by party members. Their parliamentary party retains formidable powers in the selection of the leader (they whittle the field down to two candidates) and in holding the leader to account (they can eject the leader in a vote of no confidence). They will be very tempted to find a way of holding an early general election to complete Labour’s rout.

The politics of Brexit: how should the parties respond?

I had thought things were going Remain’s way, after my near certainty of last week that Leave had won. A day helping get out the Remain vote in Wandsworth and Lambeth borders (mainly alongside Conservatives) helped cement that feeling. The vote for Remain there was 75% and over. But the backlash from the rest of England (aided and abetted by Welsh voters) was too great, and we ended up with a decisive vote for Leave. I’m still in the very early stages of grief for the country I love. British politics has suffered an earthquake. I want to offer some first thoughts about how the different parties should respond.

The Conservatives first. As my experiences here in Wandsworth shows, they are bitterly divided. But they will now have to rally behind the result and be the unequivocal party of Brexit. David Cameron was clearly right to resign, albeit at a leisurely pace. It is very revealing about those that supported Leave that so many of them thought he should stay. It bespeaks denial about the gravity of what they have done. But Mr Cameron would have been a prisoner and puppet as Prime Minister and party leader; that is not what the situation demands. Personally I think Boris Johnson should take over; his leadership may well have been decisive for Leave; he should be made to answer for its consequences. He may not have enough support amongst Tory MPs, though. But he does have momentum.

There is a clear opportunity for the Tories tok benefit from the bitter divisions in England and Wales. George Osborne’s wish for the party to build bridges with voters outside London now looks altogether more credible. Quite what this means in policy terms is less than clear. But they will need a clear focus on limiting immigration to begin winning the trust of Brexit voters.

That they have a chance to do so arises from the problems of the political left. Labour’s leadership backed the wrong horse in this race, mainly through honourable and honest belief. But their core support now comes from educated public sector workers and minority ethnic groups. The gap between this core and their previously loyal working class voters outside London has turned into a gulf. This has become a strategic problem.

I believe that the best thing for them is to stick to their beliefs keep up the attack on the advocates of Brexit. They will need to play lip service to respecting the will of the British people, but what they really need is for the Conservatives to fall apart under the stresses of trying to follow Brexit through. A period of institutional chaos is about to unfold; they need to be the party of buyer’s remorse and even “told you so”. This should be combined with a bold move to the political centre, perhaps scooping up disillusioned Conservatives.

But they have a leadership problem. Jeremy Corbyn has been criticised for being a lacklustre advocate of Remain, because of his half-hearted support for the idea. I have a feeling that the problem is much deeper. I don’t think he is cut out for hard political campaigning of any kind. On the radio this morning he sounded like a damp rag; he offered no ideas about what the country should do next. The Conservatives will have to be in bad shape indeed if they can’t beat him in a general election. And it is not just leadership. I would take an amazing act of political skill to persuade Labour members back to the centre ground. But not impossible.

Ukip have been dealt an interesting hand. They have done much to bring this situation about, and will doubtless gain Kudos. They must continue their pivot towards disaffected white working class voters, and peel them away from Labour. But it will be a hard road under Britain’s electoral system. Their power base in the European Parliament is about to be closed down. That this will hurt so badly will be amongst the many ironies of the vote.

And my party, the Liberal Democrats? The party continues its flirtation with irrelevance, and Brexit for these enthusiastic supporters of the EU makes it worse. But it has much stronger party infrastructure than Ukip; it has more MPs, more councillors and more Lords. They should benefit from the manifest troubles of the Labour and Conservative parties, but it is hard to see exactly how. They do not offer an inviting prospect for disillusioned centrist Labour and Tory MPs. I don’t see that they have much choice but to slowly rebuild on core liberal values, and make a strong appeal to younger voters. A lot will have to change to make this credible; not least it needs an influx of women and ethnic minorities into its leadership positions. I will write more on what the party should try and do another time.

And the Greens? They, too need to compete hard for that younger vote, where they have an edge over the Lib Dems. They have a very interesting strategic choice though. Do they continue with their leftwing, pro public sector lurch, away from their environmentalist roots? Jeremy Corbyn seems to have shot that fox, and offered a home for these voters in the Labour Party. But if Labour start a serious march to the centre, this gap might open up again. But if Labour continues to be a prisoner of its new members this route towards relevance will be blocked.

And the SNP? They have been presented an opportunity for independence and another referendum. But Brexit poses challenges for Scotland. A Scotland inside the EU and an England outside poses some major headaches. Many of these are about to be rehearsed on the island of Ireland. It may be hard for the SNP to create an attractive prospectus.

And what is the best thing for the country? I see the vote as a cry of pain from the politically excluded. This has a very ugly face, and I fear the rise racism and xenophobia. But all politicians should heed that voice. We must develop a new economic model that brings the excluded back in. That is the only way to bring liberalism back into fashion. If the Brexit vote hastens the development of such a new model, it will have been a good thing. All of the parties, apart from Ukip perhaps, show some signs of understanding this but are bereft of clear answers. But I fear that instead too many politicians will draw the conclusion that they should pander to dark side.

British politics is in stalemate

The British elections last Thursday were probably the most significant electoral test this parliament, with the Scottish and Welsh parliaments, the London Mayor, and many English councils up for grabs. Everybody had the chance to vote for something. The outcome was underwhelming. Where does that leave the political scene?

The analogy is overblown, but I am reminded of the war that ravaged Europe 100 years ago. In 1916 huge efforts by the major combatants yielded little return on the ground. While the military men looked for breakthrough tactics, these yielded limited results, and in the end it was a matter of stamina and fundamentals.

The results pose uncomfortable questions for all the political parties that took part, major and minor. Most of the attention has focused on Labour. They suffered a further catastrophe in Scotland, falling behind the Conservatives to third place. In England they mainly held their ground, with an impressive victory in London’s Mayoral election. Supporters of Labour leader Jeremy Corbyn hail this as vindication – but that only shows how low their expectations have sunk. There is no hint here of how the party can regain power in Westminster. The myth of a hidden bank of left wing voters waiting to be energised by Mr Corbyn has been shown to be just that. But neither is there a disaster enough to fuel Mr Corbyn’s opponents; the Scots meltdown predates his tenure and so had already been written off. The best guess is that the far left will continue to hollow the party out from within, but that the party’s outward status remains largely unchanged. Come the next general election the question is whether the party will implode or simply repeat its dismal performance last time. On this year’s evidence it will be the latter.

For the Conservatives the position looks considerably better. They drifted only gently backwards in English councils; their performance in London was reversion to type, after unexpected success under their Mayor Boris Johnson; and they achieved a remarkable breakthrough in Scotland. But to keep governing beyond 2020 they will need to deliver a killer blow to Labour, while containing any Lib Dem comeback. Can they do that when they are riven by divisions over Europe, will replace their leader with one who has much less public respect, and while their government programme keeps being derailed by backbench discontent? Meanwhile their tactics in London, where they tried to toxify Labour’s Sadiq Khan by associating him with Mr Corbyn and Muslim extremists, failed, and may have damaged the party’s brand.

The SNP maintained their grip on Scottish politics but lost their overall majority. They have completed an astonishing pivot to the left, allowing the Tories a bit more breathing space, and leaving Scots to wonder what the point of Labour is. It is hard to see how anybody is going to deliver a knockout blow, but more Scots will surely start to tire of them. The only way seems to be down.

Ukip cemented their status as a major UK party, with breakthroughs in the Welsh Parliament and London Assembly, and consolidation of their role as Labour’s main opposition in parts of the north of England. But they are a party of oddballs, and it is hard to see how they can maintain their coherence. As a party of local government in England, they won only 15% of the seats of the supposedly down and out Lib Dems; this is a weak grassroots base.

The Greens moved forwards in Scotland, and held their own in London, where they are established as the third party by popular vote. But in English council seats for every gained they lost a seat somewhere else, to end up with even fewer seats than Ukip. Their switch to the left, while downplaying their environmentalism, looks to have been a strategic error, with the wind taken out of their sails by the revival of the Labour left.

And my own Lib Dems? There were quite a few successes; they gained more English council seats than any other party, and are approaching half the Conservative total. They comfortably retain their position as the third party of local government. There were striking constituency wins in Scotland and one in Wales. But all the Lib Dem successes boiled down to pockets of local strength, where they are deeply embedded into civic society. They have shown their ability to claw back ground from the Tories in particular, and even the SNP. But talk of a revival of fortunes belongs in the same category of optimism as the Labour left’s. The party was reduced to a single seat in both the Welsh parliament and London Assembly, and fell behind the Greens in Scotland. They struggle to reach 5% in proportionally elected contests, an irony for a party that is so in favour of this type of election. The party has not established clear political ground for itself and remains confused as to whether its coalition years were its finest hour or a terrible mistake. The party fights irrelevance in most of the land.

Plaid Cymru continued to move sideways. The politics of Wales remains quite different from that in Scotland, and the party seems quite unable to replicate the SNP’s success.

And nobody else made an impact. The Women’s Equality party was launched last year in a big media splash, and tried its luck in London, but got nowhere. The nativist Britain First is another new party, which has a big presence on social media, and it put in a performance that beat other competitors in its space (such as the British National Party), but still only managed a derisory result. For all the claimed discontent of the public with established politicians, there is not even a faint sign of an insurgency that could take off.

So British politics is in deadlock. The Conservatives have a narrow majority in the UK parliament but lack the discipline to govern decisively. There is no evidence as yet that they are going to break out of this. But neither is there any sign of a party or coalition of parties that can knock them off their perch.

There is a broad lesson here about British politics that is not given enough weight by most commentators. Political success requires a strong grassroots infrastructure and solid organisation, built up over many years, as well as being able to chime with some part of the zeitgeist. Labour and the Conservatives have achieved this more or less across Britain, now that the former are rebuilding themselves in Scotland. Fear of losing this vital political infrastructure stops either party from breaking apart, in spite of huge political divisions. The SNP has this in Scotland and is consolidating. That the Lib Dems are in the fight at all after failing so spectacularly to hit the zeitgeist is testament to their pockets of grassroots strength and penetration of institutions like the House of Lords; they have something to work with. Ukip and the Greens have attempted to build their own infrastructure but are finding it desperately hard going. Nobody else stands a chance. There will be no unconventional uprising like Italy’s Five Star movement. It is also very hard for a nativist insurgency, such as that of Donald Trump in the US, or the Front National in France, to get traction – though Ukip has tried.

And so we are locked in stalemate. The biggest threat to this dynamic is if one or other of the major parties breaks up under the strain. The second possibility is that the Tories get their act together sufficiently to deliver a knock-out punch to a Labour Party that does not look interested in government. As yet there is no sign of either.

To see the significance of IDS’s resignation we must look past the dead cat

My last post on the Budget took on the gorilla cliché. This time I want to talk about dead cats. What brings this on is the spectacular resignation of Iain Duncan Smith, popularly referred toas IDS, who had been the Work and Pensions Secretary.

Is this a dead cat moment? The metaphor comes from election strategist Lynton Crosby, who guided the Conservatives to their spectacular election win last year. He suggested that if the news agenda goes awry, you should “throw a dead cat onto the table” to distract attention. The IDS episode has certainly done that. It has dominated the news for well over a day now, pushing out all other political stories from home and abroad.

In whose aid would the dead cat have been brought into play? That would have to be the Leave campaign in Britain’s EU referendum, and indeed much of the comment suggests that this issue lay behind the resignation. But Mr Duncan Smith says it is about the Budget, and how it juxtaposed tax for the wealthy with withdrawing allowances for the disabled.

But it is hard to see what the dead cat was meant to distract our attention from. The Budget was hardly a triumph, and was pretty neutral in the great EU debate. The Remain side wanted to claim a coup with regard to VAT on tampons, which has got tangled up in EU rules. But that’s small beer. Maybe the Remain campaign were plotting something. There is surely frustration about how easily the Leaves seem to be able to hijack the news agenda, but it was surely too early for a news coup. If it had been timed to coincide with President Obama’s future visit to the UK, then that would have been different.

Indeed Mr Duncan Smith is a particularly guileless politician. This lends him a certain charisma, which briefly took him to a disastrous period as Conservative leader, but his general lack of political and management skill is very evident.

Which leads me to think that he can be taken at face value this time, which is what Observer commentator Andrew Rawnsley suggests in what looks like an authoritative analysis. The referendum has created the general context of tension, but Mr Duncan Smith and George Osborne, the Chancellor, have been at loggerheads for many years. Mr Osborne tweaked his tail once too often.

Which means that much of the chatter about the episode being linked to the referendum is misplaced. It is very hard to know what its impact will be on that campaign. It’s effect on two other issues may be more significant.

The first is the fate of IDS’s pet project: Universal Credit (UC). This aims to replace a complex system of tax credits and benefits with a single scheme that is linked to income levels in such a way that incentives to work are not destroyed. This idea has wide political support, and it is the a centre piece of the government’s benefit reform narrative. But it is technically difficult to do because it depends on near real time data on income levels. This, incidentally, is the opposite approach to that taken by the Treasury, which prefers to focus its data gathering on a small number of better off people, rather than tangling with the sometimes chaotic lives of the less well off.

The technical challenges mean that the roll-out of UC is a long way behind schedule. It had really only been sustained by Mr Duncan Smith’s political capital. Now that is gone, surely the project will collapse? That will be a victory for the Treasury, but it will leave a hole in the heart of government policy. What will the government do next?

But there is a bigger issue for the government than even that. In my last post I pointed about how hard it will be for the government to force through further cuts in public spending, leaving the government’s financial plans dependent on a sudden, and unlikely, spurt of old-fashioned productivity (as opposed to the new-fangled sort that will leave tax revenues untouched). The government has a small majority. It needs political will, discipline and cohesion to push its fiscal plans through without breaking promises on tax. Mr Duncan Smith had shown that solidarity until now. The Conservatives will have to find a way to rebuild it after the referendum, probably under a new leader. That is now more difficult than ever.

Who might that new leader be. Mr Osborne looks to divisive. The London Mayor Boris Johnson probably lacks support within the parliamentary party, and has a credibility problem. He’ll lead the polls under the going gets serious. I would not rule out that dark horse: Theresa May.

Core voters are always shafted. Politics is made in the centre. Bad news for Lib Dems

Democracy and idealism do not sit well together. Idealists have the motivation to form political parties and keep them going. But in order to win power the party must bring on board people and, policies, that the idealists disagree with, in order to win round those less committed to politics. And these floating voters come to matter more to the party’s managers than the the idealists. Because the idealists have nowhere else to go.

In Britain, the latest challenge to this process comes from Britain’s Labour Party; in America the Republicans seem to be doing something similar. This all seems to be part of the great cycle of politics. A party’s core supporters, those that are ideologically committed, get fed up with being taken for granted and rebel. They struggle to accept that a majority of voters disagree with them – following a natural human bias that most people think as we do. They may also be enticed by the idea that they can win by accident – through their opponents’ mistakes. Sometimes such ideological parties do win an election that way – it has just happened in Poland, for example. It rarely ends well.

I know more about the Labour phenomenon than the Republican one. Labour members elected the ideological Jeremy Corbyn after the party’s general election failure last year. These members remain as fervent as ever, and indeed new members have flocked in. This burst of enthusiasm has convinced them that they have started a new and better form of politics. As they see it, the compromises used to chase the centre ground, as uncommitted voters are usually referred to, have disillusioned people with politics. Now Labour will create a sharper narrative that will go down a storm with the electorate. They equate their own disillusionment with the compromises of their party with the widespread political apathy of the population at large.

But is this is an illusion. This week Britain’s polling organisations published a report into why they called the 2015 election wrongly. They overestimated Labour support and underestimated the Conservatives’. They found this was mainly because their samples were biased towards Labour. And that was because they were biased towards the politically committed, who were much easier to reach. This is a vulnerability of the quota sampling technique that the pollsters use. The less committed, or more apathetic, voters were much more likely to vote Tory.

This leaves more thoughtful Labourites with two headaches. The first is that current polls show the Labour vote holding up compared to the general election – so that electing Mr Corbyn at least hasn’t made things worse. But if the polling bias remains (and it seems to be, based on how the samples remember they voted in 2015), then in fact the Tory lead has grown. The second headache is that the army of the apathetic non-voters is more sympathetic to the Tories than many suppose.

Which leads to an inevitable conclusion. In order for Labour to win an election they need to convert people who voted Conservative last time, or who did not vote, but lean to the Conservatives. In other words, Labour must appeal to the centre ground.

Such thoughts cut no ice with Labour’s new members. When pushed they even suggest that winning is not that important. That leaves Labour in a terrible position, and the Conservatives thinking that they have the next election in the bag. Some hope that the European referendum will split the Tories. But the prospect of whacking Labour really hard if they hold together is the best possible incentive to hold the party together.

Labour’s prospects against the SNP in Scotland are no better; the SNP have cornered the middle ground in Scotland as masterfully as the Conservatives in England, while still retaining a substantial core vote. This conjuring trick will eventually come apart – but an ideological Labour Party will not be the instrument of the SNP’s demise.

Meanwhile, sitting on the sidelines are the Lib Dems. A number of people have suggested to me that Labour’s woes present the party with a golden opportunity. But the political dynamics or the core and centre are not working the party’s favour.

The party thought that the usual rules of politics would apply to them when they went into coalition with the Conservatives in 2010. They shafted their core voters, but surely they had nowhere else to go? And meanwhile the party’s record in government would appeal to the centre ground. But a large part of what the Lib Dems thought was their core vote felt they did have an alternative: Labour. That weakened the party, and weakness is a big turn-off for centrist voters. The Conservative campaign exploited this ruthlessly, and the result was catastrophe, as the Lib Dem vote fell by two thirds, and their political clout even further.

So, somehow, the Lib Dems need to rebuild their core vote. The place to look is amongst Labour inclined voters who do not buy Labour’s new sense of direction. But the party also needs to win votes back centrist voters from the Conservatives if they are to win the all-important parliamentary seats. And that means the party must show distance from the Labour Party. So how does the party face the prospect of another coalition with the Conservatives? If they rule it out, they will lose the middle ground by giving tacit support to the ideological Labour Party. If they don’t, those Labour inclined “core” voters will think that the party has learned nothing from the coalition debacle, and leave the party alone.

This may not matter too much to the party at the next election, especially if it looks as if the Tories will win handsomely. There will be no danger of a coalition, so that awkward question can be ducked. The Lib Dems might be able to make a modest recovery based on local strength. But the strategic dilemma remains.

Probably the best thing for the party is to recognise that it is essentially of the left, and rule out any future coalition with the Conservatives. That will help the party rebuild its core. It then needs to apply thought to under what conditions it could work with Labour. But it will have to be a very different Labour Party from the one emerging under Mr Corbyn’s leadership.

Which would leave the middle ground in British politics to the Conservatives and the SNP. Which in turn means that political power will rest with them. A grim prospect indeed.