After the sound bites, who has the answers?

Labour’s booing of Tony Blair was the defining moment of the party conferences. But while Ed Miliban

It erupted at one end of the auditorium and rumbled like a broken wave towards the podium. Ed Miliband held up a hand to ask for quiet, but his smile and half-closed eyes indul­ged the noise. "I am not Tony Blair . . ." the Labour leader had said, and before he could finish the point, party conference in Liverpool had ratified it with this peculiar sound. It was neither a cheer nor a jeer, but a mixture of both - a mirthless exaltation of the difference between the current leader and the one who secured victory for the party in three consecutive general elections. Back in London, Conservative officials, preparing for their own party's gathering in Manchester, punched the air.

It was the emblematic moment of the 2011 party conference season, and revealing, in these days when conferences are stage-managed to avoid episodes of spontaneous political revelation. A surge of unscripted emotion from the floor seems to say more than the speech it interrupts, the party's heart heckling its head.

All of the conferences this year seemed more than usually timid and remote: a succession of formulaic orations punctuated with footling policy announcements - a collective cowering from the scale of the political and economic challenge facing Britain. What have we learned from it all, other than that politics seems increasingly unequal to the task?

It was certainly not news that many Labour members dislike Tony Blair. The grievances are many. His policies on everything from welfare reform to foreign military intervention can be held up against an impossible ideal of left-wing government and called treason. Perhaps that is the inevitable fate of politicians who lead their tribes out of the wilderness and into government. David Cameron has been in Downing Street for less than two years, and already the right-wing purists in his party are drafting the charge sheet of betrayals: Europe, immigration, taxes. It is easy to imagine the Prime Minister's name one day being jeered by an embittered Tory party, freshly evicted from power and looking for comfort in opposition.

But Labour's problem with Blair is about more than policy. It contains a hazardous aversion to the very techniques of political craft that New Labour deployed to get elected, and which are barely distinguishable from the devices of consumer marketing - mapping the "centre ground" with polls and focus groups and targeting a message accordingly.

The ideological promiscuity required for that process is inherently distasteful to much of the Labour Party, including Miliband. He is the product of an intellectual family and he likes the company of people with an appetite for abstract ideas. Two of his closest advisers, the new peers Maurice Glasman and Stewart Wood, come from university politics faculties. The Miliband project is underpinned by a liking for theoretical rigour of the kind that Blair often saw as a gateway to opposition.

Cameron, for his part, finds the left's craving for doctrinal coherence baffling. It is a vital point of difference between Labour and the Conservatives that, among Tories, absence of ideology is rarely perceived to be a failing. Pragmatism need not be meretricious, especially in the patrician mould of pre-Thatcher grandees, such as Harold Macmillan, in whose tradition Cameron follows. Those obliged by noblesse have no need for ideology.

The Prime Minister has always struggled to provide a succinct definition of Cameronism because he is not persuaded that the word should exist. Shortly after becoming Tory leader, he wrote: "I don't believe in 'isms'. Words like communism, socialism, capitalism and republicanism all conjure up one image in my mind: extremism."

Miliband, by contrast, has gambled his party's future on the rehabilitation of "ism" politics. His speech to the Labour conference was based on a theoretical critique of the economic consensus that has governed Britain for a generation, albeit camouflaged in mangled delivery and clunky construction.

The underlying argument is that New Labour did not change the structure of the economy it inherited from the Conservatives, merely modified it with an apparatus of stealthy redistribution. It took more in taxation from people higher up the income scale and handed out the proceeds to those at the very bottom. But it had nothing to say about the implicit morality of how people earned their living or what should constitute a decent and fair allocation of wealth within a society.

For all its claims to navigate a "third way" between rampant free markets and heavy-handed state intervention, Blairism was Thatcherism with welfare compensation tacked on. The whole enterprise was made possible by the flow of revenue to the exchequer from a booming economy and from people's readiness to supplement their income with debt. That bubble has burst. The vital question in British politics now is whether the failure was one of error, or morality. Is the task largely technical - a quest for new sources of economic growth combined with dogged determination to repair the public finances? Or are we contemplating something bigger - the irreversible decline of our established way of organising society and the economy?

Miliband thinks it is the latter. He said many times during his leadership campaign that the financial crisis signalled the certain demise of an old way of doing things, though few outside the party were listening. That is what he now means when he says he is not Tony Blair.

It is not, however, what Miliband's political opponents understood by that assertion. The view inside the coalition government is that the repudiation of New Labour is a sign of weary political surrender. The working assumption in Downing Street is that Labour's deepest instincts are hostile to commerce and predisposed to confiscate wealth, which makes the party incapable of reaching out to voters who want to get on in life. By extension, if Miliband says things that comfort a Labour conference, he is ruling himself out as a serious candidate to be prime minister.

As one very senior government strategist said to me recently: "What Ed's speech told us is that Labour is now comfortable with losing again." Privately, this is also the settled view of Blairite veterans, out of front-line politics and muttering to anyone who will listen about the electoral cul-de-sac into which Miliband is leading the party. Several members of the shadow cabinet quietly agree.

That analysis is easy to accept because Mili­band's version of an alternative economic model is almost entirely undeveloped and because he is so obviously flawed as an evangelist. It is tempting to see the differences in presentational competence between Miliband and Blair as a proxy for the veracity of their creeds.

The Labour leader is too gauche for voters to imagine him waving from the steps of Downing Street, or so focus groups report. Yet that needn't have any bearing on whether his interpretation of the scale of economic and social change being visited on Britain is right or wrong. Likewise, Cameron's easy deportment is an asset in his eventual bid for re-election, but no guarantee of success.

Though Cameron is able to exude governing authority, that image will increasingly be undermined by his lack of control over events. He has devolved economic management to the Chancellor, who has locked Britain in to a course of painful austerity. Together with the Liberal Democrats, the Conservatives have made unflinching commitment to this programme the test of their governing credibility. Whether or not it works - and drab growth forecasts suggest it is failing - this strategy all but guarantees that the Tories will fight the next election presiding over a society made generally poorer and in which the distribution of wealth and assets is more conspicuously uneven. There will be fewer public services and they will be worse.

Meanwhile, the most important issue weighing on Britain's future prosperity is, without doubt, the crisis in the eurozone. By extension, that is a crisis in governance of the entire European Union. Awkwardly, serious engagement with that topic is taboo for Cam­eron, as it animates feelings in the ranks of his party which, once stirred, are hard to control. Anti-Brussels anger seethed and swirled around the Tory conference fringe. It will not be contained for long.

The conditions are quite fertile for a reani­mation of everything that the public in the mid-1990s found thoroughly unpleasant about the Conservative Party - complacency in the face of social decline, destructive meddling with the National Health Service and a cranky obsession with Europe. Under those circumstances, Cameron's easy charm seems unlikely to achieve among sceptical voters what it failed to achieve in 2010. Recent polling conducted in marginal seats by the former Tory deputy chairman Michael Ashcroft found that only 26 per cent of people think of the party as "being on the side of ordinary people". These are voters in constituencies that Cameron has to win over if he is to form a majority in the next parliament. For Labour, the figure is 46 per cent.

That is one of very few sources of comfort for Miliband. At present, the country is not very interested in what he has to say, but that might change when the stored potential for rage against the Tories is released. Time and patience might yet yield an audience. This is what one shadow cabinet ally of Miliband calls the "Zen" approach to opposition. The problem is that meditation, seen from the outside, is hardly distinguishable from somnolence.

Tory strategists are nonetheless worried about the party's stubbornly toxic brand. Broadly speaking, there are two approaches to the problem. On one side are the radical reformers, led by Cameron's chief policy adviser, Steve Hilton. They urge the leader to pursue an agenda of ever more drastic changes in the public sector - what one source close to Hilton calls "Blairism on steroids". On the other side is the cautious counsel of Andrew Cooper, Downing Street's in-house pollster, who worries that revolutionary activism around the public services merely aggravates voter anxiety that the Tories are hatchet-wielding zealots, breaking up public services not out of sober fiscal duty but for the fun of it. George Osborne, in whose hands the party's re-election strategy ultimately lies, takes the Cooper approach.

The cautious squad has felt its hand strengthened by the perceived weakness of Miliband's performance in Liverpool. Osborne's assumption is increasingly that the Labour threat can be contained with a relentless assault on the leader's credibility. That will be combined with constant reminders of Ed Balls's complicity in running the economy in the period before the crash. The aim is to discredit Labour so thoroughly that, even if voters are aggrieved and alarmed by the state of the economy, they will not see the Miliband-Balls team as entitled to offer alternative solutions.

Yet that tactical caution is a source of concern for some of the more liberal-minded Tories. A few even lament Miliband's failings, feeling that it encourages complacency in the Prime Minister. As one fervent Tory moderniser told me after the Labour conference: "The danger is that if Ed Miliband is flatlining in six months' time people will start to think we can cruise."

Miliband flatlining is, however, the outcome desperately desired by the Lib Dems. Their strategic objective is to fight the next election as the party best placed to prevent the Tories from forming a majority. Nick Clegg's long-term goal, announced well before the last election, is to rival Labour as the progressive alternative to the Conservatives in British politics. That might look like a fantasy now, given the junior coalition party's dismal poll ratings, but the aspiration behind it can still damage Miliband.

The Lib Dems are relying on voters continuing to doubt the Tories' capacity for compassion, and want to claim authorship of anything the coalition does to soften the blows of austerity. For the plan to stand a chance of working, Clegg needs Miliband to continue limping ineffectually on the sidelines of the debate.

“If it becomes clear that he can't make it, the interesting argument is between us and the Conservatives," says a leading strategist for the Liberal Democrats. "With each passing year we can squeeze Labour out."

Whatever their differences, the two coalition parties are united in the assumption that Miliband is throwing away his party's chances of governing the country after the next election. The irrefutable proof of that proposition is held to be Labour's improvised theatrical renunciation of Blair and his works in Liverpool. The implication is that the party, in rejecting its last ballot-box champion, is rejecting also the mechanisms required to secure victory in modern politics - thespian amiability and doctrinal flexibility.

That may be the case. But the one thing for which neither the Lib Dems nor the Conservatives seem to be preparing is the possibility that Miliband is unelectable and right at the same time. What then? Suppose that everything Blairism had to say about political craft and the tactics required to secure victory remained true, but everything it had to say about the terms of compromise between government intervention and free markets no longer applied.

One feature of the last election is that figures at both extremes of the political spectrum felt somehow that it was their turn to govern. The left saw the New Labour governments, whether under Tony Blair or Gordon Brown, as enacting a craven capitulation to the orthodoxies of Thatcherism. The right saw New Labour as the reassembly of a high-spending, high-taxing big-state apparatus - a retreat from Thatcherism. Each side felt the pendulum must be swinging back towards it. They can't both be right.

Eighteen months have passed since the election and a new polarisation is emerging from those assumptions about the pendulum. Labour is embracing a kind of social-democratic revi­valism, assuming that the electoral terrain, left fallow for a generation, is ready to be sown with arguments about equality and restraining capitalist excess. The Conservatives are sensing, in the rigours of fiscal austerity, an implicit moral validation of their long-held ambition for shrinking the state. The Liberal Democrats want to insert themselves between the two, pursuing a strategy of wilful electoral stalemate and calling it centre-ground moderation.

This is a strange political era into which we are entering, heralded by that eerie noise in a Liverpool auditorium, the heckling of Blair's ghost. Its defining features are disorientation, the loss of fixed compass points to navigate to electoral breakthrough, and the belittling of politics itself, made to look parochial by frightening global economic forces. In this new era, the stopped pendulum swings to no party.

Rafael Behr is the chief political commentator of the New Statesman