Orange Book

After the 2005 general election, all three parties essentially modeled their platforms on Blairism. The Tories selected the liberal-minded PR man David Cameron as their leader, and started sounding like New Labour. The Liberals overthrew their affable, slightly-left-of-Labour leader Charles Kennedy in what became known as the “Orange Book” coup.

The “Orange Book” was a neoliberal manifesto, for privatization in the NHS, privatization in pensions, competition in public services, and the shrinking of the state.

The fresh-faced front man for this putsch, was a Cambridge-educated blue blood from Buckinghamshire, Nick Clegg. Clegg took over December 2007, just as the world economy was heading toward its worst crisis since the 1930s. From then on, the Liberals were on the “radical center,” attacking Labour mostly from the right. Nor did the credit crunch change this. By 2009, Clegg hailed the “Liberal Moment”: a chance to displace Labour as the main progressive party. An atomized, polyglot society in a globalized world called for liberal solutions. Austerity was both economically necessary, and a chance to free the citizenry from the snares of statism.

This purview was remarkably close to Cameron’s prospectus for a “Big Society.” Going into the 2010 election, therefore, the Liberal pitch was apolitical: they were “honest brokers” confronting an out-of-touch establishment; just the security blanket for which a rattled country was crying out. With Labour in crisis, the Tories distrusted, and a sudden surge of media-driven enthusiasm (the “Cleggasm”), it looked like the Liberals would beat Labour into third place.

Coalition

In the end, the Cleggasm was an anti-climax. The Liberal Moment was an illusion. The vote increased by only 1 percentage point and they lost five seats. But while the Conservatives had gained 96 seats, no party won an outright majority. It was either coalition or fresh elections.

In the background of the ensuing talks between the Liberals and the Conservatives were the financial markets. Gus O’Donnell, head of the civil service who orchestrated the bureaucracy’s handling of the negotiations, put pressure on the parties to reach a coalition in order to reassure investors that austerity would take place. According to diaries of the negotiations kept by Laws, the Liberals wanted to “send out the clearest possible signal that we would support tough action to steady the financial markets.” Clegg repeated the message to his shadow cabinet. If the financial class wanted stable austerity government, this was just dandy for the Liberals who, disappointed by the results and with empty coffers, didn’t want another election.

A deal with Labour was never a serious option. It would be unstable and, at any rate, the Liberals far preferred the Tories. The only reason they pretended to negotiate with Labour at all was to buy time and increase their leverage with the Conservative team. But had the 2010 election been fought on the 2005 manifestos, a Liberal-Tory coalition wouldn’t have been possible.

By 2010, Laws recounts, the two parties managed to agree on almost everything. The Liberals made their four key issues a £10,000 personal allowance before income was taxed, more funding for poorer students, a green economy, and electoral reform. George Osborne said, “Electoral reform is tough for us, but on the rest of the political reform agenda we are very open to your ideas.” The Liberals countered by advocating the weakest form of electoral reform, Alternative Vote, in exchange for their backing of Tory efforts to redraw electoral boundaries and reduce Labour’s representation.

This worked, and coalition had the unique advantage of freeing each party from its base — the Liberals from reformers in their own ranks, the Tories from their hard-right xenophobes.

Tuition Fees

The agreement, however, elided major issues of far greater import to the voters. For example, the Liberals had built a lot of support from students, and from parents, by promising to end tuition fees in higher education. This was in the context of an upcoming report by former BP executive Lord Browne, which it was thought would recommend raising fees.

In fairness to the Clegg and Laws, and their business spokesperson Vince Cable, as Orange Bookers they had vehemently opposed the anti-fees stance. They stressed fiscal credibility, but they had wholly internalized the view of public choice theory, according to which free education was merely a subsidy for a pampered client base. They agreed with the arguments for fees advocated by New Labour figures like Lord Adonis.

But the party’s policy committee insisted on keeping it in the manifesto. And though Clegg insists that it wasn’t “even a campaigning priority,” Liberal MPs were encouraged to sign a pledge opposing any future increase. Clegg himself brandished the “pledge card” and made videos opposing a fee rise. In retrospect, he says, “I shouldn’t have done it.” Nonetheless, he really seems surprised by how much it mattered. “I didn’t think tuition fees would be an albatross around my neck forever.”

When politicians blame voters, they often do so, patronizingly, by blaming themselves. So it is with Clegg. “We had failed to spell out how unsustainable the existing financial regime was for universities,” he explains. Which is a way of saying, the public just didn’t get it. He goes on to blame opposition on “the most basic, emotional instincts parents have,” an “intense emotional backlash.” Trying to explain “the logic of the policy” to protesters, he found that “my rational explanation was no match for visceral emotion.”

Laws is more focused on the political game, which he thinks Liberals mishandled. However, he argues that, had it not been for tuition fees, many voters would “still have found some other ‘betrayal’ to point to, in order to justify withdrawing their support.” As though, the outrage was just a cover story for base fickleness. Likewise, for Laws there is no question that the Liberals got “the substance so right” even if they got “the politics so disastrously wrong.” This, again, feels like a deflected form of blaming the public.

Austerity

The macroeconomic strategy underpinning the coalition is an acknowledged failure, but doesn’t provoke serious or searching questions from either figure.

As Laws points out, the benchmark the coalition set for itself was “its ability to restore growth and return the government’s budget to balance.” Yet, as he also acknowledges, growth had already returned by the time the coalition was set up: “more than enough, if sustained, to reduce unemployment, increase tax revenues, and reduce borrowing.” Somehow Laws cites this very state of affairs to justify the emergency austerity budget that he helped draft. “This would clearly have some impact on growth, but the Treasury thought the impact would be very modest.” The Treasury was wrong. And the point, supposedly, had been to restore growth, not to use restored growth to expedite public spending cuts.

As Laws goes on to admit, the austerity measures hit hard — particularly the rise in VAT, a regressive tax which ate into household budgets. This should have been embarrassing, as the Liberals had campaigned against VAT increases. Vince Cable, newly minted business secretary, cheerfully shrugged when asked to explain the Liberal change of heart: “We were trying to score a point against the Conservatives, if you like. OK, well that was in the election. We have now moved past the election.” The immediate result, in Laws’s words, was “an eighteen-month period of flatlining.” Two years in, Clegg acknowledges, the same story obtained: “There was precious little evidence that our economic strategy was working.”

The following year, “the economic situation had barely improved.” Not only that, but deficit-reduction was going abysmally. “Plan A was not working,” Clegg says, and Chancellor Osborne’s solution was “to expand the cuts to departmental spending.” Because they shared a vocabulary with the Tories, the Liberals didn’t regard this as fundamentally ludicrous. They did, however, think that Osborne was being inflexible when even the City wanted some sort of action to counter recessionary trends. What they had proposed, therefore, was an “ease and squeeze” strategy of bringing forward capital investments and pushing back spending cuts to later in the parliamentary term, but all within the borrowing and spending parameters already set by Osborne.

Both Laws and Clegg detail how they blocked some of the more inhumane policies, but in many cases it seems likely that they were played. For example, Osborne, at one point, advances the politically toxic idea of charging VAT on food. The Liberals, vetoing this, get to pat themselves on the back, even as they continue to wave through more spending cuts.

Likewise, Clegg and Laws put a lot of emphasis on tax allowances, “freeing hundreds of thousands of low-paid workers from paying income tax.” But most of the tax poor people pay is indirect taxes on consumption, which went up. Study after study found coalition tax and spending policy to be regressive. Most of the time the Liberals offered a version of whatever the Tories were doing. As, for example, when Nick Clegg repudiated the scale of Osborne’s proposed welfare cuts. Danny Alexander, the Liberal Chief Secretary to the Treasury, then proposed a set of cuts even more hawkish than Osborne. Ultimately, he was talked out of this by Laws, and they scaled back the cuts: but they still voted to punish poor people for the crisis.

When it came to health reform, the Liberals were blindsided by Andrew Lansley’s massive plans to commercialize the NHS. But they had no objections to privatization, and after getting Alexander to review the policy along with Tory minister Oliver Letwin, they agreed to go ahead with it. Only a storm of “political controversy” enjoined Clegg to briefly consider withdrawing support.

And there was always money for the rich. Osborne slashed corporation taxes, Laws notes, to the “lowest in the developed world.” With Clegg’s assent, he also cut higher-rate income taxes. Just as well, according to Laws, since the extant rate of 50p in the pound for the top rate was higher than in “communist China.” Supposedly, this cut would attract investment and spur new dynamism. We’re still waiting.

Illiberal Age

Perhaps the biggest failure from the Liberal perspective is the collapse of their political reform agenda, and the ensuing illiberal drift of politics. Clegg really seems to believe that the “heady days” of May 2010, when he was briefly feted as an honest politician, were significantly about reforming the electoral system.

The coalition, Clegg thought, between austerity and political reform, offered “renewal on the two fronts where it was needed most.” Ultimately, therefore, he blames the defeat of Alternative Vote, the least proportional of all “proportional” systems, on everything but the idea itself. He blames austerity, a fickle public, the media, the Tories, Labour, and admits to a “somewhat herbivorous campaign.” But the likely effect of this electoral reform would have been to make the Liberal-Tory coalition permanent: far from empowering the millions who had boycotted the electoral system since 2001, it would be an establishment stitch-up. The Liberals lost because they cared only about becoming parliamentary kingmakers.

And so it went on. With a weak economy, worsening living standards, and a growing crisis in the eurozone, support for liberalism was collapsing. The UK Independence Party (UKIP) was making a comeback after a dismal 2010 performance. Right-wing Tory MPs were rebellious over Europe and immigration. From that point on, the European Union was an increasingly salient issue, and the Liberals were constantly trying to stop Cameron pandering too much to his base. It was increasingly obvious that there would be some sort of referendum on membership in the next parliament, in which the Liberals — as the most fervent pro-Europeans — would be a completely spent political force. And Cameron’s feints to the Tory right, Clegg complained, “make it very difficult to go into coalition with the Conservatives in 2015.”

Ultimately, that wasn’t an issue. Coalition destroyed the Liberals. They had hoped, Laws said, that their poll ratings would recover “as the economic recovery took hold.” Any recovery was short-lived, and not reflected in real incomes, which fell by 10 percent — to say nothing of the deep cuts to benefits. The Liberals no longer had a plausible pitch to public-sector professionals, students, and other left-of-center voters, with their record on tuition fees, cuts, and public-sector “reform.” They had passed some decent policies, such as marriage equality, but they had also participated in the most sustained attack on living standards in decades.

After five years of coalition, they were beaten into fourth place in vote-share by UKIP, and left with fewer seats than the Scottish National Party. Cameron and Osborne seemed to have triumphed. The Tory modernizers had used coalition to detoxify themselves, and then stolen Clegg’s voters. But this was the beginning of the implosion of the center. Within a few months, Corbyn would be Labour leader, and a year later, Brexit would finish off the Cameronites.

Farronade

What comes across powerfully in the “sorry, not sorry” accounts of Laws and Clegg is their continued affection, creeping toward the sentimental, for the ruthless Tory operators who helped destroy them politically. They enjoyed their time in office together, and they have intelligent, sympathetic observations about one another. One senses that, but for the accident of their being in different parties, they might be factional allies.

By contrast, their measure of the electorate is utterly disdainful. For a party that ran against a corrupt and dishonest establishment, they are astonishingly brazen and cynical about their betrayals, and seemed to regard constituents as manipulable and stupid. They still think it was the public who were wrong.

Such, essentially, is Clegg’s analysis of politics today, and it informs his fascination with behavioral economics — he played a key role in opening Number Ten’s “nudge unit.” Socialism, Conservatism, and nationalism, he laments, “all emit powerful emotional depth-charges” while “liberalism is a philosophy of rational enlightenment, of head not heart.” Sadly, “people follow stories, not policies, in politics.” This is Clegg’s idea of politics “between the extremes”: there is rational argument on one side, and there is visceral emotion on the other. And nothing more shaded or subtle or co-constituting than that.

Yet although Clegg surely aligns himself with evidence-based thought, his conviction at times seems almost invincible to new information or self-refutation. Nothing, neither Brexit nor Corbyn, no amount of evidence or even flat-footed self-contradiction, seems able to convince him that “conventional left-right arguments” and “the old left-right terms of trade of British politics” no longer matter. He makes the same arguments today as he has always made, no matter what passes. And so, of course, do his confederates.

Consequently, the Liberals are currently in no man’s land. After Nick Clegg’s resignation, the party elected a slightly left-of-center leader, Tim Farron. But his weak, pale yellow version of social democracy — a distillation I like to call Farronade, the Liberal micturesque, trickle-down politics — was irrelevant given the rise of Corbyn.

The Liberals thought, last year, that Brexit would be their encore. The horror at an exit from the European Union driven by Britain’s worst reactionaries would see people recoil toward the center. There were signs of revival, as Labour descended into factional rivalry. There was even speculation that defecting Labour rightists would form a ludicrous coalition with Farron.

That moment, like the “Cleggasm,” was a moist mirage, long gone. So is Farron. Clegg lost his seat after being targeted by Momentum. The Liberals are led through the wilderness by the sepulchral Vince Cable, struggling to defend a niche as a middle-class, anti-Brexit protest party. An irrelevance in all else: sans teeth, sans votes, sans power, sans everything.