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Leader: All change please, the old order terminates here

We need a Labour-Lib Dem coalition committed to electoral reform to seize this progressive moment.

From its beginning, in 1913, this magazine has been committed to the values of liberty, equality, democracy, internationalism, anti-colonialism and freedom of expression. We are both liberal and social democratic. We believe passionately in the potential of the enabling state to liberate individuals, and that it is the duty of any government to intervene to mitigate the effects of the free market and to redistribute wealth in pursuit of greater opportunity and the common good. Progressive politics ought to be about the dispersal of power and opportunity, not its centralisation, as happened under Margaret Thatcher and during periods of the New Labour years.

In 1997, following Tony Blair's first landslide victory, New Labour had an opportunity to remake British politics. It can be hard to recall just how exciting the first 100 days of that government were. Energetic and purposeful, restless for power, the first New Labour administration began a revolutionary transformation of the fractured British state. The Freedom of Information Act, independence for the Bank of England, devolution, the explicit mission to abolish child poverty, the aspiration to have an ethical foreign policy (swiftly renounced): those were heady times.

But somewhere along the way, the revolution was postponed. The ideals of New Labour were inevitably compromised by the pragmatism of power. The al-Qaeda attacks on New York and Washington, DC on 11 September 2001 created an international emergency, after which Mr Blair emerged as one of the chief exponents of the global "war on terror", with disastrous consequences for himself and for Britain's place in the world. Mr Blair's wars, notably Iraq, led to many of the Labour Party's core supporters abandoning it in despair. They have never returned.

In 1997, Labour had the chance to realign centre-left politics for ever, in alliance with the Liberal Democrats. Central to a common programme would have been constitutional reform, the abolition of the House of Lords and the introduction of proportional representation in order to free us from the tyranny of our two-party system. First-past-the-post, which leaves millions of people - when they can be bothered to cast their vote at all - feeling disenfranchised, is the embodiment of all that has gone wrong with our outdated and dysfunctional model of government.

But Labour tribalists scuppered an opportunity for genuine progressive renewal - a reminder that the paladins of reactionary "Labourism" were every bit as committed to the old ways of Westminster and Whitehall as the most traditionalist Tory.

Then there is the deeply infantilising way we do politics in this country. The political-media nexus is all-pervasive and our politicians have become ever more robotic, timid and fearful. Gordon Brown's encounter with Gillian Duffy, the pensioner from Rochdale, was significant for many reasons, but most significant of all was how it exposed his terror of media humiliation. He thought the encounter was "disastrous" because, as he said from inside his car, "they would go with that" - "they" being the media. It is this terror that led Labour to court the Murdoch family and then to feel betrayed when Mr Murdoch's British newspapers, as well as Sky television, turned against it. One can only be grateful that we have the BBC.

Yet this election, which takes place in the shadow of the first great crisis of globalisation and in the aftermath of the MPs' expenses scandal, presents an opportunity. At every election since 1945, the combined Labour and Liberal/ SDP-Liberal Alliance/Liberal Democrat vote has outstripped that of the Conservatives. However, because of the vagaries of an unfair voting system, this "progressive majority" has never received proper expression in the distribution of seats in the House of Commons. But that might, at last, be about to change. We have argued for some time that a hung parliament - the likelihood of which remains real, despite the modest uptick in the Tories' vote share in the opinion polls since the last leaders' debate - offers the possibility of a realignment of progressive forces in British politics, and with it the political and economic transformation this country so desperately needs.

It should be remembered that the constitutional reforms that the Liberal Democrats would rightly demand as a condition of entering into a coalition with Labour are a necessary but not sufficient condition of the kind of thorough-going change we are calling for. A fairer voting system is desirable not only on grounds of fairness, but also because, as international evidence shows, proportional electoral systems tend to be more successful in delivering the egalitarian ends that this magazine has always regarded (and continues to regard) as a sine qua non of social-democratic politics. The past 13 years show how first-past-the-post awards grotes­quely disproportionate influence to middle-class voters in a small number of marginal constituencies, with the result that Labour has consistently tacked rightwards.

We saw one consequence of this in the final leaders' debate on the economy, when the Prime Minister was frustratingly unwilling to trumpet Labour's achievements in tackling inequality and social injustice. Wage and income inequalities have risen slightly under Labour since 1997. However, as research by the Centre for Economic Performance at the London School of Economics has shown, inequality would have been much worse without Labour's efforts to redistribute income. Indeed, the party's record in government is too easily taken for granted: increased investment in public services, the revival of Britain's cities and the introduction of the minimum wage are just three of a number of notable achievements.

We agree with Lord Adonis when he argues that what unites Labour and the Liberal Democrats is more important than what divides them. But, all the same, there remain significant philosophical differences between liberalism and social democracy - on the size of the state, the role of the market and the nature of equality. Indeed, members of the influential Orange Book faction inside the Lib Dems display a classical liberal suspicion of the state, and have flirted with the idea of dismantling the National Health Service and reversing the increase in public spending seen under Labour.

It is also the case that the Liberal Democrats, an overwhelmingly white and middle-class party, are less concerned with redistributing wealth to the poorest than Labour. An analysis by the Institute for Fiscal Studies of the party's tax plans shows that they would favour those on middle, not low, incomes. Only £1bn of the £17bn cost of raising the income-tax threshold to £10,000 would go on taking the lowest earners out of tax. Elsewhere, the Lib Dems have pledged to reduce the deficit through spending cuts alone, a position that puts them to the right of the Conservatives. By contrast, Labour favours a ratio of 67 per cent spending to 33 per cent tax rises, with the Tories opting for a 80:20 split. The age of austerity promised by George Osborne would be even more austere should Vince Cable make it to the Treasury.

Mr Brown has struggled as Prime Minister, unable to command the unity of his cabinet and incapable of connecting or communicating successfully with the wider electorate. He has equivocated and dithered. He has raged and apologised. Yet when it mattered most his response to the economic crisis was correct and decisive: the recapitalisation of the banks to prevent systemic collapse and then hyper-Keynesian fiscal and monetary stimulus to prevent recession becoming depression. That will be his legacy, as he acknowledges in his interview with Jason Cowley on page 10.

David Cameron's lacklustre campaign deserves to fail. His early positioning was undoubtedly impressive. He spoke a different kind of language from his immediate predecessors: the language of so-called compassionate conservatism. We recognise that he is, as he says, a genuine liberal on a range of social issues, from civil partnerships to race relations.

Yet he and his small clique of advisers also cling to a small-government, state-slashing, pro-market, pro-rich neoliberal ideology which is as dangerous as it is discredited. The economic recovery is too fragile to be entrusted to Mr Cameron and his shadow chancellor, George Osborne. They are wedded to immediate and ideological cuts in public spending, in defiance of advice from the IMF and the OECD, among others.

In addition, their policy proposals are contradictory and inconsistent. They claim to oppose the "nanny state", but have pledged to use the tax system to bolster marriage. They suspend homophobic candidates at home, but ally with homophobic parties abroad. They proclaim "we are all in this together" while offering an inheritance-tax cut to the richest 3,000 estates in the land. They have spent the past year demanding that the government take action to cut the deficit but have pledged to spend any future "efficiency savings" on cutting National Insurance.

Mr Cameron may have appropriated Barack Obama's "Vote for change" slogan, but his party remains committed to preserving the status quo on a host of issues, from electoral reform to financial regulation. For four and a half years, the Tory leader has presented himself to the electorate as the agent of change, claiming to be a "progressive conservative". But behind the spin and the rhetoric, he remains simply a conservative, not a progressive.

A tactical vote on Thursday 6 May will help to prevent a Conservative victory. It will also, in this most volatile and unpredictable of elections, be a vote for the genuine change that, in its current state, Labour cannot deliver on its own. Consequently, in constituencies where the Lib Dems stand the best chance of defeating the Conservatives, voters should offer their support to Nick Clegg's party. And in those seats where Labour remains in first or second place, we encourage our readers to cast a positive vote for it. That way lies our best chance of seizing this progressive moment.