Dominic Lawson: Seventy years on, we are still appeasing dictators

In dealing with Libya the Foreign Office has been guilty of institutional cringe

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In this, the week of the 70th anniversary of the outbreak of the Second World War, British newspapers have published entire supplements, setting out once again how the policy of appeasing dictators showed a complete failure to understand the gangster psychology of totalitarian regimes.

Yet the unravelling tale of our current government's negotiations with the regime of Col Gaddafi is a more enthrallingly contemporary illustration of the unchanging institutional cringe known as the British Foreign & Commonwealth Office. We have learned – chiefly through the medium of government memos leaked to the Sunday Times – how the Foreign Office saw the release from Scottish custody of the convicted Lockerbie bomber, Abdelbaset al-Megrahi, as a way of earning us good favour in the court of Megrahi's patron and distant relative, Muammar Gaddafi.

In some of these memos you can hear the sound of Foreign Office ministers past and present patting themselves on the back for the results of their negotiations. There is much discussion of the alleged trade benefits, notably a deal between BP and Libya. But two days ago the Libyan Europe Minister, Abdulati al-Obeidi, admitted to that outstanding foreign correspondent Hala Jaber that even if the British Government had set its face against the release of Megrahi, it was "highly unlikely" that the deal with BP would have been cancelled: "Libya also looks out for its interests and to cease the BP deal is not in our interests." Indeed so: last week we learned of BP's astonishing discovery of a 3 billion-barrel oilfield 35,000ft below the Gulf of Mexico seabed, far and away the deepest well ever drilled. If you were the Libyan regime you would very much want the company with such technological leadership helping you to find oil on your territory.

There is a more particular sense in which the Foreign Office has played the hand of the appeaser in its negotiations. The Libyans had made dark noises about the likely reaction of their own population should Megrahi die in Scottish custody – something along the lines of "in such an eventuality we cannot guarantee the safety of British citizens in Libya". This unsubtle threat should have been greeted with the observation that it was the responsibility of the Libyan Government to ensure the safety of innocent British citizens on its territory. Instead we seem to have behaved like the weak tradesman confronted by an unscrupulous protection racketeer.

It is, of course, very embarrassing when craven behaviour comes to light via a leaked memo to the Sunday Times. Hence Gordon Brown's overnight conversion to the idea of asking the Foreign Office to assist with the claims for compensation of the victims of IRA bombs constructed from Semtex provided by Libya – having earlier told the victims' lawyers that the Government could have nothing to do with their campaign.

Yet this attempt to regain the high moral ground is even more contemptible than the decision to leave those victims of Libyan Semtex out of the original deal. When Britain and America did their separate deals over the reopening of normal relations with Gaddafi's regime, the Americans insisted that their own victims of Libyan-backed IRA atrocities be financially compensated; the British made no such demands, essentially declaring that bygones are bygones.

One cannot blame Gaddafi's son, Saif, for ridiculing the British Government's extraordinarily belated decision to take an interest in the demands of those particular victims of the IRA. It is so obviously a manifestation of political panic faced with one day's unfortunate headlines and at odds with the entire tenor of the negotiations between the two governments over many years. I feel especially sorry for the victims, since it is clearly far too late for this matter to be renegotiated, and they are being deceived if they are being told otherwise.

The Foreign office argues – through the medium of Jack Straw, who has never managed to shake the dust of King Charles Street from his shoes – that it is only its particular brand of diplomacy that managed to persuade Gaddafi to abandon his nuclear and chemical weapons programmes (such as they were) and return to the respectable fold of nations who do not engage in random acts of terror. This is held to be our triumphant alternative to George Bush's denunciation of Libya as part of "an axis of evil" – the rhetoric that underpinned the invasion of Iraq.

It is undeniable that the short-term successful campaign to remove Saddam Hussein led to a bloody civil war which was completely unanticipated by the hawks of the Pentagon and which continues to destroy lives and livelihoods. Yet when did Col Gaddafi first send his message to British negotiators that he was ready to give up his weapons and return to the paths of peace? It was on the eve of the invasion of Iraq. And when did he finally capitulate to the demands of the US and British Governments? In the week that Saddam Hussein was fished out of his foxhole. Indeed, if Silvio Berlusconi is to be believed, the Libyan dictator told him at the time that the invasion of Iraq had made him very afraid of what the US might do to him if he didn't come to the negotiating table. More credibly, Hans Blix, no particular friend of the Pentagon, declared at the time that "I would imagine that Gaddafi could have been scared by what he saw in Iraq."

In fact, the Americans missed a much bigger opportunity to seize the opportunities created by their move against Saddam. In the immediate aftermath of the invasion of Iraq, the Iranian Foreign Ministry suddenly sent Washington detailed proposals for negotiations over its own weapons programmes. We know this from the former National Security Council official Flynt Leverett, who three years later wrote a furious article attacking the Bush administration for spurning this offer, which had come via the Swiss ambassador to Iran. Instead of replying to Tehran, the US government simply rebuked the Swiss Foreign Ministry for overstepping its diplomatic mandate.

On the one hand, we could argue that this brush-off demonstrated the insane hubris of the administration of George W Bush, circa 2003. On the other hand, the unbidden Iranian attempt to negotiate with Washington, coming as it did hard on the heels of an equally panicky diplomatic move by Col Gaddafi, shows that the most thuggish regimes – apparently impervious to reasoned compromise – will show a sudden willingness to make concessions when faced with the prospect of their own extinction.

For this reason, it is hard to believe that it was mere coincidence that the Soviet Union gradually lost its will to maintain its military control over Eastern Europe during the period of the Reagan and Thatcher administrations – although it is possible that the Soviets took too seriously Reagan's humorous radio sound-check in 1984: "My fellow Americans, I am pleased to tell you that today I've signed legislation that will outlaw Russia forever. We begin bombing in five minutes."

That blooper made Ronald Reagan look silly; but not half as ridiculous as Gordon Brown now appears. He can't be consistent even in appeasement. Say what you like about Neville Chamberlain, but at least he was a strong prime minister prepared to defend his own policies.

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