The Lib Dems' identity crisis just got a lot more critical

Coalition was meant to be a journey to political maturity and professionalism. But it's amateur hour yet again.

Let’s start, as justice demands we must, with the assumption that Chris Rennard, the Liberal Democrat peer and former party chief executive, is not guilty of allegations of sexual harassment levelled against him. They are not proven and he denies them. Still, since we know that Nick Clegg’s office was informed of complaints of that nature back in 2008, there can only be two possible reasons why the matter was not thoroughly investigated.

The first is that no-one really took the allegations seriously. The second is that the allegations were deemed grave and credible but the importance of Rennard to the Lib Dem political operation and the fear of besmirching his and the party’s good name made thorough investigation feel politically too risky. Both interpretations imply contempt for people who say they have been sexually harassed. Either way the party leadership comes out of the whole business looking negligent and disorderly.

That impression has been amplified by Clegg’s handling of the affair – specifically, his tantalising statement on Sunday, dragging Danny Alexander into an opaque narrative of "non-specific" allegations and vaguely sought reassurances. The Lib Dem leader admitted to having known something all along but couldn’t say exactly what it was. It is hard to imagine a response more finely calibrated to send the press pack into a feeding frenzy.

Most of the British press doesn’t need much incitement to sink claw and fang into the Lib Dems. The timing of the scandal – breaking in the middle of a crucial by-election campaign – has lead to some reasonable suppositions of ulterior anti-Clegg agendas at work. The Eastleigh campaign certainly adds electoral piquancy to the story but the Lib Dems can hardly complain about that. Wishing it had not come out now implies that there might have been some better time for it to come out, which is really a way of wishing it had never come out at all and that instinct is what makes the whole thing scandalous in the first place.

This is bad for Clegg. But how bad exactly? Most of the people in Westminster I’ve spoken too in the last couple of days think the Lib Dems will still hold Eastleigh. It is almost impossible to tell whether any of the Rennard-related news cuts through on the Hampshire front line. If it does, I’d imagine a likely consequence will be mildly affiliated Lib Dem voters staying at home on polling day. Since the party’s strategy on the ground relies on a ferocious Get-Out-The-Vote operation, a surge in abstentions would be problematic.

But I suspect the Lib Dems' pain in this saga will go further and deeper than seeing their by-election campaign blown off course. A central problem for the party since joining coalition government has been clarity of identity. They surrendered the vague pieties of perpetual opposition in the hope of graduating into the status of grown-up party of government.

Clegg’s office has a clear enough sense of where they think he and the party can stand on the political spectrum. They are supposed to be more compassionate than the dinosaur Tories and more fiscally rigorous than profligate Labour. Opinion polls don’t yield much evidence that the Lib Dems are actually perceived that way but the aspiration is plausible enough. There is, in theory, a gap in the political market – a Blair-shaped hole – for third-way candidates who combine economic rigour with a social conscience.

But to fill that gap the Lib Dems must above all look like a serious political outfit. The pitch is non-ideological and pragmatic. They are supposed to be the go-to guys for coalition when the voters don’t fancy handing unalloyed power to either of the bigger parties. They are offering themselves as the moderate technocrats who aren’t afraid of compromise and keep Westminster grounded and centred. You aren’t necessarily expected to like the Lib Dems anymore, but, according to Clegg’s strategy, you are supposed to think it worthwhile having them around in government.

The defining feature of this offer is professionalism and it is the absence of that very quality that stands out from the mess they are in over Lord Rennard. The charges themselves (unproven and denied, it must be said), the original handling of complaints five years ago and the sprawling case study in crisis mismanagement over the past week all conjure up the impression of an organisation staffed with chancers and over-promoted amateurs.

It is already pretty hard to overstate the problems with the Lib Dem brand. Not enough people know what they stand for. (Do they even know anymore?) Clegg himself is still seen as a slippery character, a betrayer of promises and a trader of principle for the baubles of office. The electoral life raft that strategists were crafting was fashioned from claims to be delivering stable, effective government. Lib Dem plans for 2015 are based on the hope that eventually some voters will come to look at their record in office and judge them to have been decent and useful. Yet here they are in a colourful parade of shabby and useless.

Nick Clegg renewing his coalition vows earlier this year. Photograph: Getty Images.

Rafael Behr is political columnist at the Guardian and former political editor of the New Statesman

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What is the EU customs union and will Brexit make us leave?

International trade secretary Liam Fox's job makes more sense if we leave the customs union. 

Brexiteers and Remoaners alike have spent the winter months talking of leaving the "customs union", and how this should be weighed up against the benefits of controlling immigration. But what does it actually mean, and how is it different from the EU single market?

Imagine a medieval town, with a busy marketplace where traders are buying and selling wares. Now imagine that the town is also protected by a city wall, with guards ready to slap charges on any outside traders who want to come in. That's how the customs union works.  

In essence, a customs union is an agreement between countries not to impose tariffs on imports from within the club, and at the same time impose common tariffs on goods coming in from outsiders. In other words, the countries decide to trade collectively with each other, and bargain collectively with everyone else. 

The EU isn't the only customs union, or even the first in Europe. In the 19th century, German-speaking states organised the Zollverein, or German Customs Union, which in turn paved the way for the unification of Germany. Other customs unions today include the Eurasian Economic Union of central Asian states and Russia. The EU also has a customs union with Turkey.

What is special about the EU customs union is the level of co-operation, with member states sharing commercial policies, and the size. So how would leaving it affect the UK post-Brexit?

The EU customs union in practice

The EU, acting on behalf of the UK and other member states, has negotiated trade deals with countries around the world which take years to complete. The EU is still mired in talks to try to pull off the controversial Transatlantic Trade and Investment Partnership (TTIP) with the US, and a similar EU-Japan trade deal. These two deals alone would cover a third of all EU trade.

The point of these deals is to make it easier for the EU's exporters to sell abroad, keep imports relatively cheap and at the same time protect the member states' own businesses and consumers as much as possible. 

The rules of the customs union require member states to let the EU negotiate on their behalf, rather than trying to cut their own deals. In theory, if the UK walks away from the customs union, we walk away from all these trade deals, but we also get a chance to strike our own. 

What are the UK's options?

The UK could perhaps come to an agreement with the EU where it continues to remain inside the customs union. But some analysts believe that door has already shut. 

One of Theresa May’s first acts as Prime Minister was to appoint Liam Fox, the Brexiteer, as the secretary of state for international trade. Why would she appoint him, so the logic goes, if there were no international trade deals to talk about? And Fox can only do this if the UK is outside the customs union. 

(Conversely, former Lib Dem leader Nick Clegg argues May will realise the customs union is too valuable and Fox will be gone within two years).

Fox has himself said the UK should leave the customs union but later seemed to backtrack, saying it is "important to have continuity in trade".

If the UK does leave the customs union, it will have the freedom to negotiate, but will it fare better or worse than the EU bloc?

On the one hand, the UK, as a single voice, can make speedy decisions, whereas the EU has a lengthy consultative process (the Belgian region of Wallonia recently blocked the entire EU-Canada trade deal). Incoming US President Donald Trump has already said he will try to come to a deal quickly

On the other, the UK economy is far smaller, and trade negotiators may discover they have far less leverage acting alone. 

Unintended consequences

There is also the question of the UK’s membership of the World Trade Organisation, which is currently governed by its membership of the customs union. According to the Institute for Government: “Many countries will want to be clear about the UK’s membership of the WTO before they open negotiations.”

And then there is the question of policing trade outside of the customs union. For example, if it was significantly cheaper to import goods from China into Ireland, a customs union member, than Northern Ireland, a smuggling network might emerge.

 

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.