Andrew Grice: Ministers forced down beneath the dark clouds of reality

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Ministers have a real dilemma over how to respond to the dark economic clouds hanging over the Conservative Party conference. Too much emphasis on what Winston Churchill called the "sunlit uplands" and the Tories would look dangerously out of touch with millions of families struggling with squeezed household budgets. But too much gloom and there is a danger of turning a eurozone drama into a full-scale British crisis.

Yesterday George Osborne tried to pull off a delicate balancing act. He believes the Liberal Democrats, at their conference two weeks ago, overdosed on the gloom. So he erred on the side of cautious optimism. "I don't want anyone to underestimate the gravity of the situation facing the world economy. But I also don't want anyone to think that the situation is hopeless; that there is nothing we can do," he said. His message was: "Together we will ride out the storm."

His problem is the dire weather forecast from the rest of the world. In public, most Tory representatives at the Manchester conference put on a brave face, saying there is no alternative to the Osborne cuts plan. In private, they press ministers for a more vigorous growth policy and fear the political implications of a double-dip recession. As one told me: "Although it would be caused by global conditions, if it happens on our watch, we will get the blame."

Another shadow stalks Mr Osborne: the desire to avoid a U-turn. The Chancellor's official line is that moving to a Plan B would spook the financial markets. There is another reason: it would amount to an admission that Plan A was wrong and attract the biggest U-turn headlines since last year's election.