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Leading article: Neither side may wish it, but compromise is the solution

This week the Coalition government faces its first great trial of strength with the unions as about 750,000 teachers, lecturers and civil servants prepare to walk out over reforms to public pensions. No one can describe the forthcoming battle as unexpected. David Cameron may not espouse the same shrilly ideological grudge against unions in principle that Margaret Thatcher appeared to evince in the 1980s. But the whole thrust of Mr Cameron's and George Osborne's agenda, which strives towards a grand rebalancing of the economy, away from the public sector and towards private enterprise and the voluntary sector, necessarily implies a clash with the unions. When the Government talks of "the country" bearing the weight of cuts in spending, this is shorthand for cuts to the numbers, wages and pensions of civil servants. So, neither side is sleepwalking into combat; it was a question of where and when.

Each side is banking on public support swinging gradually if not immediately behind it. The unions hope that this week's industrial action will be start of rolling strikes that gather strength as summer shades into autumn, tapping into a deep vein of public discontent with the handling of the economy that has hitherto struggled to find expression. With any luck, they may calculate, the strikes will expose new strains in the Coalition, adding to the unhappiness already felt by many Liberal Democrats with Government policies and so precipitating the collapse of the Coalition.

The Government, for its part, also believes that it holds a few aces. With some justification to judge by recent surveys, ministers believe that most people in work now tend towards a view that the public sector has become a privileged group in terms of its working hours, pensions and sick-leave arrangements. They will be hoping that even if mainstream Liberal Democrats are deeply disenchanted with Tory cuts, as a party they are neither tied to the unions nor necessarily sympathetic to them.

The Prime Minister will also be looking to expose splits inside the Labour Party, which is certainly placed in a difficult position by the strikes. Financially, Labour is tied to the unions. At the same time, the party is under a new leader who, though elected by union block votes, is restive about the relationship. Ed Miliband has sounded noticeably cool about the walkouts. Telling the unions that "the most important thing is to get the public to understand what their argument is" was not the ringing endorsement of industrial action that union leaders wanted to hear. The unions are right to worry that Mr Miliband's obvious antipathy to being cast as a union patsy could leave them without an important political champion in Parliament in the weeks and months to come.

One obvious danger is that each side feels so confident of ultimate victory that it is tempted to escalate the conflict. Bullish talk from No 10 of "cracking down" on union power does not help. Threats to outlaw full-time union officials from receiving salaries paid for by the tax payer; and ban strikes unless 50 per cent of all members vote for them, may thrill some Tory die-hards. They are also likely to lock ordinary members of striking unions, not just the militants, into a do-or-die mentality that makes negotiation almost impossible. The other concern is that the question at hand, the adjustment of pensions to meet the fact that most people live longer than they used to, will get lost in an irrelevant, 1970s-style debate about "Who runs Britain?". Compromise may be a dirty word, both for unions fearing humiliation, and for a Government that fears gaining a reputation for flip-flops and U-turns. That doesn't mean it isn't a good idea.