Nick Clegg speaks at Bloomberg's London headquarters on June 9, 2014. Photograph: Getty Images.
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The smaller coalition party nearly always gets smashed – but all is not lost for the Lib Dems

To cement its identity in future coalitions, the party needs to own departments.

Shortly before the 2010 general election, aware that the Conservatives were unlikely to win a majority, an anxious David Cameron asked Angela Merkel what it was like to lead a coalition government. “The little party always gets smashed!” she mischievously replied. As he met the German chancellor in Sweden in recent days, Cameron could have been forgiven for recalling her remark. Like their sister party in Germany, the Free Democrats, which lost all of its seats in the 2013 Bundestag election, the Liberal Democrats have indeed been smashed.

Since 2010, they have lost a third of their members, 1,500 of their councillors, all but one of their MEPs, nine by-election deposits and more than half of their previous opinion-poll support. The Tories, by contrast, have retained most of their 2010 vote share of 36 per cent and have consistently exceeded expectations in local elections. “We knew we would pay a price for working with the Conservatives,” said Nick Clegg in his recent speech at the Bloomberg headquarters in London.

In these circumstances, one might expect there to be little optimism among the Lib Dems. But the shifting plates of British politics have given them hope. With both the Tories and Labour doubtful of winning a majority in 2015, many Lib Dems believe that they will once again act as kingmakers in a “balanced parliament” and extract significant concessions for doing so.

Some are even more sanguine. At a recent parliamentary party away day in Wyboston, Bedfordshire, Danny Alexander declared that the Lib Dems could become the largest party in British politics by 2025. “We were all rolling our eyes, even Clegg’s spads,” one of those present tells me. David Steel’s 1981 exhortation to Liberal activists to “go back to your constituencies and prepare for government” looks modest by comparison.

Though it is now rarely recalled, there were those who argued that coalition would enhance, not diminish, the Lib Dems’ popularity. The standard explanation offered for the party’s recurrent midterm slumps was that it failed to receive the media attention devoted to the Conservatives and Labour, a defect rectified by equal treatment at the time of the general election. But with Liberal Democrats in government, this disadvantage would be removed permanently. The more the public saw of the third party, the logic ran, the more it would like it.

That the reverse proved to be the case was partly because of their alliance with the Tories. As Tony Blair shrewdly observed, a party that ran to the left of Labour for three successive elections could not hope to avoid punishment for entering government with a party to its right. Long before Clegg and his fellow Lib Dem ministers walked through the division lobby in favour of higher tuition fees, their poll ratings had collapsed.

The party’s “contamination” by the Conservatives encourages the thought that an alliance with Labour could have a cleansing effect. Clegg’s pledge in his Bloomberg speech to borrow to invest in infrastructure was the latest example of policy convergence between the two parties. But a partnership with the opposition would pose dangers of its own kind. Such is the degree of policy overlap that the Lib Dems would risk becoming indistinguishable from their centre-left rival. The existential question that stalks Clegg – “What is the point of the Lib Dems?” – would become more rather than less insistent in coalition with Labour.

It is in anticipation of this fate that the former Lib Dem minister Jeremy Browne has called for the party to embrace an “unbridled, unambiguous” programme of free-market liberalism. Browne considers the left-leaning party president, Tim Farron, and the Business Secretary, Vince Cable, to be examples of what Keynes called “watery Labour men”: social democrats who would be better off with Ed Miliband.

What Browne’s position boasts in intellectual rigour, it lacks in electoral nous. Outside the City of London, there is little appetite for turbo-Thatcherism. Rather than veering to the right, the Lib Dems should adopt other means of differentiating themselves. An increasing number in the party, including on its federal executive, believe it was a mistake for Clegg not to demand control of entire government departments in 2010. His decision instead to spread the Lib Dems across Whitehall made it harder to claim credit for policy achievements and left the party’s junior ministers looking like the helpless hostages of their Tory superiors. The next time parliament is hung, the party should learn from the approach of its Scottish sister, which took control of justice and agriculture in its first Holyrood coalition with Labour in 1999 and prospered in the subsequent election. Far from being wiped out, the party retained all 17 of its seats in 2003 and most of its vote share.

Having named his coalition negotiating team for 2015, Clegg should already be targeting politically attractive departments. A Lib Dem minister could win control of the housing portfolio and take credit for a Macmillan-style building programme, or secure home affairs and act as the guardian of civil liberties. Tim Farron told me: “There’s a lot of wisdom in that . . . When you’re a smaller party, identity is everything. Being known for one or two and, if you’re really lucky, three good things is what you’re after in terms of getting traction with the voters.”

A few days ago, Clegg received a consoling text message from his friend Jan Björklund, the leader of the Swedish Liberal People’s Party (currently polling at 6 per cent). “Us liberals,” he wrote, “must never accept that we can only survive in opposition.” An admirable sentiment – but if the Lib Dems are to avoid being continuously smashed in a new era of hung parliaments, they need to wise up and ensure they are better prepared.

George Eaton is political editor of the New Statesman.

This article first appeared in the 11 June 2014 issue of the New Statesman, The last World Cup

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Saudi Arabia is a brutal and extremist dictatorship – so why are we selling it arms?

With conflict in Yemen continuing, it’s clear that we’re failing to moderate the actions of “our despots”.

This year, during Pride week, I noticed something curious on top of the Ministry of Defence just off Whitehall. At the tip of the building’s flagpole hung the rainbow flag – a symbol of liberation for LGBTIQ people and, traditionally, a sign of defiance, too.

I was delighted to see it, and yet it also struck me as surprising that the governmental headquarters of our military would fly such a flag. Not only because of the forces’ history of homophobia, but more strikingly to me because of the closeness of our military establishment to regimes such as Saudi Arabia, where homosexuality is a sin punishable by jail, lashing and even death

That relationship has been under the spotlight recently. Ministers writhed and squirmed to avoid making public a report that’s widely expected to reveal that funding for extremism in Britain has come from Saudi Arabia. The pressure peaked last week, after a series of parliamentary questions I tabled, when survivors of 9/11 wrote to Theresa May asking her to make the report public. At the final PMQs of the parliamentary term last week, I again pressed May on the issue, but like so many prime ministers before her, she brushed aside my questioning on the link between British arms sales and the refusal to expose information that might embarrass the Riyadh regime. 

The British government’s cosy relationship with Riyadh and our habit of selling weapons to authoritarian regimes is “justified" in a number of ways. Firstly, ministers like to repeat familiar lines about protecting British industry, suggesting that the military industrial complex is central to our country’s economic success.

It is true to say that we make a lot of money from selling weapons to Saudi Arabia – indeed figures released over the weekend by the Campaign Against Arms Trade revealed that the government authorised exports including £263m-worth of combat aircraft components to the Saudi air force, and £4m of bombs and missiles in the six months from October 2016.

Though those numbers are high, arms exports is not a jobs-rich industry and only 0.2 per cent of the British workforce is actually employed in the sector. And let’s just be clear – there simply is no moral justification for employing people to build bombs which are likely to be used to slaughter civilians. 

Ministers also justify friendship and arms sales to dictators as part of a foreign policy strategy. They may be despots, but they are “our despots”. The truth, however, is that such deals simply aren’t necessary for a relationship of equals. As my colleague Baroness Jones said recently in the House of Lords:

"As a politician, I understand that we sometimes have to work with some very unpleasant people and we have to sit down with them and negotiate with them. We might loathe them, but we have to keep a dialogue going. However, we do not have to sell them arms. Saudi Arabia is a brutal dictatorship. It is one of the world’s worst Governments in terms of human rights abuses. We should not be selling it arms.”

With Saudi Arabia’s offensive against targets in Yemen continuing, and with UN experts saying the attacks are breaching international law, it’s clear that we’re failing to moderate the actions of "our despots".

The government’s intransigence on this issue – despite the overwhelming moral argument – is astonishing. But it appears that the tide may be turning. In a recent survey, a significant majority of the public backed a ban on arms sales to Saudi Arabia and just this weekend the Mayor of London denounced the arms fair planned in the capital later this year. When the government refused to make the terror funding report public, there was near-universal condemnation from the opposition parties. On this issue, like so many others, the Tories are increasingly isolated and potentially weak.

Read more: How did the High Court decide weapon sales to Saudi Arabia are lawful?

The arms industry exists at the nexus between our country’s industrial and foreign policies. To change course we need to accept a different direction in both policy areas. That’s why I believe that we should accompany the end of arms exports to repressive regimes with a 21st century industrial policy which turns jobs in the industry into employment for the future. Imagine if the expertise of those currently building components for Saudi weaponry was turned towards finding solutions for the greatest foreign policy challenge we face: climate change. 

The future of the British military industrial establishment’s iron grip over government is now in question, and the answers we find will define this country for a generation. Do we stamp our influence on the world by putting our arm around the head-choppers of Riyadh and elsewhere, or do we forge a genuinely independent foreign policy that projects peace around the world – and puts the safety of British people at its core?

Caroline Lucas is the MP for Brighton Pavilion.