By giving Britain stability, Nick Clegg has pulled off a remarkable coup

The Lib Dem leader has played a blinder to keep the coalition together in turbulent times. Shame he's brought no new ideas to the table
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Nick Clegg 2009
Nick Clegg listens to a speech from Chris Huhne at the Liberal Democrat conference on 20 September. Photograph: Darren Staples/Reuters

There is no argument. The Liberal Democrats and their leader, Nick Clegg, have played a political blinder this past 18 months. They have kept a British coalition government in being against all odds, with no sign of it collapsing in the near future. Nor have the Lib Dems just sustained a regime, as they did some governments, Tory and Labour, in the 1920s and 1970s. They have palpably had a restraining influence on it. They deserve recognition at least for this.

Before the 2010 election Clegg was hailed by the Westminster pundits as a Churchill, an Obama, an agenda-setter, a "weather-changer". He was "the most exciting politician in Britain", who would fly high at the polls and determine the course of a hung parliament. He would change the rules of the game. Like most punditry, this was drivel.

I wrote at the time, "Poor Nick Clegg: this is as good as it gets." History showed that coalitions rarely survive, and centre parties that prop up one or other extreme tend to meet horrible fates. Hung parliaments might delight electoral reformers, but they aid only minority parties with specific demands, such as Jewish settlements, Bavarian autonomy or hand-outs to friends. When the arithmetic of parliament gives them a hand, the British Liberals have lacked a defining agenda beyond the ambition of their leaders. When they dallied with power, as under David Steel in 1978, it spelled disaster. I gave Clegg's deal with David Cameron two years, at the most.

I expect to be wrong. The party has certainly lost almost 700 councillors in local elections and dropped to single figures in the polls. Clegg, who has made a decent fist of the dire job of deputy prime minister, has been ridiculed. The media regularly catalogues the humiliations and defeats to which his party has been subjected. But all this was predictable (and predicted). It obeyed the iron law of coalitions.

What history should find astonishing is that Clegg is still there. His chief lieutenants, Vince Cable, Danny Alexander and Chris Huhne, are still in office, commanding important areas of government. They have nudged the NHS, the universities, school grants, penal policy, energy policy, Europe and abortion in directions not normally associated with Tory governments. Much of their influence may have been barmy, such as Huhne's inflationary energy pricing. But nobody could describe the Lib Dems as invisible coalition partners.

Thanks to the tact of Cameron and the deftness of Clegg, the Lib Dems have held the cabinet roughly to the terms of last year's coalition manifesto. The parliamentary party has not split or seen serious defections, as coalition parties normally do. There has been no "ministers' party" and backbenchers' party. Clegg retains the support and respect of his MPs and most of his constituencies, even when he cannot offer potentially rebellious MPs the promise of office. He and they know they face probable annihilation at the next election. Yet for all the rumblings at the Birmingham conference, like Cathars at Montségur, the Lib Dems face death with discipline.

They even discuss it in public. Their popular president, Tim Farron, spoke on Monday of the party's "nerves of steel" and of its ministers as participants in a coalition marriage that was "witless, a nightmare and doomed to end in divorce" well before the next election. This was brutal but honest. While it might horrify the 18 Lib Dems now drawing ministerial salaries, few strategists can see the party entering the next election other than detached from their Tory colleagues. A 1918-style "coupon election", with Tories standing aside in winnable Lib Dem seats and vice versa, is inconceivable. After four years in government the strains within the coalition are likely to be intense. A divorce would seem kind, and in the best interests of both parties in the runup to an election. Clegg must somehow engineer a disagreement of principle on which to stage a pre-election separation.

This makes the intellectual timidity of the Lib Dems in government all the more curious. Why have they been so silent on Cameron's wars? Where are they on the planning reforms, which have left even many Tories mystified and angry? Why are they so lukewarm on localism and hostile to drug law reform? The party accepted the odium of higher "tuition fees", yet failed to take any credit for turning the fees into what they are, a graduate tax.

Most baffling of all has been the idiosyncratic course plotted by the party's Gandalf, Vince Cable. While his acerbic attacks on bankers have gone down well on the doorstep, he has failed to make them bite where they should, in the City. Harping on about bonuses and executive pay without doing anything about either has merely emphasised his impotence as industry secretary. The banks' lobbyists ran rings round him and Cameron on the Vickers proposals for investment banking, which are now lost in distant long grass.

As for Cable's obsession for "quantitative easing" as the preferred vehicle for aiding recovery, he does not seem to know what it is. Like BBC newsreaders, he parrots the cliche that easing is "to kick-start the economy", yet after billions of pounds have rolled off the government printing presses, easing has totally failed in this goal.

Theory holds that buying bonds from banks is supposed to channel cash into lending, and thus into spending. It does no such thing, because at present the banks use the cash to pay off their gambling debts. Yet when challenged to stimulate more immediate growth, the best Cable can offer is to "bring forward" some grand construction projects.

The Lib Dems have signed up to the same "toff economics" as obsessed Gordon Brown, Alistair Darling and now George Osborne. This relied for recovery not on giving money to consumers in tax cuts and benefit increases but on giving it to banks and builders. It sought to stimulate demand by giving money not to those who might spend in the high street but to institutions that would not, backed up with halfhearted City speeches about "boosting loans to businesses" that were going bankrupt for lack of customers.

The Lib Dems seem to bring no new ideas to this table, from left or right of the policy spectrum. They have pulled off a remarkable political coup, offering the country stable leadership at a time of economic turbulence. But as to finding a way out of that turbulence, they remain intellectually barren. They are wasting a great opportunity.

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