Labour finally begins to choose its enemies

Press tycoons will not like Robin Cook's willingness to join a single currency

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Robin Cook's assertion about the single currency - that he would favour British entry in 2002 if it was a success - is the most significant act of political positioning in the 1997 general election campaign so far. It is a shaping moment for New Labour.

As a provocation, it matches Gordon Brown's tax pledge. But it goes further in one key regard: it is a rare example of a clear view from the Opposition that contradicts, rather than confirms, the received wisdom of Britain's political and media establishment.

What effect will it have on Tony Blair's extraordinarily subtle and persistent wooing of Labour's old enemies in business and the press? New Labour's charm-troopers have tickled up Rupert Murdoch and Lord Rothermere something rotten, and stroked many of the tycoons who backed Margaret Thatcher, and then John Major in 1992, into a kind of dazed, purring acquiescence. Will these boys like what Cook has said?

I think not. Yes, both Blair and Major are committed to "wait and see" on the single currency. Yes, neither would enter in the first wave - Major because his party would fall apart, Blair because the legislation for creating an independent Bank of England and so on would tie up New Labour's first government in knots for a couple of years, losing it vital momentum.

Nevertheless, there is now a significant gap between the parties. Both know that the key date for abolishing the pound for the euro is 2002. And, all things being equal, Labour is now clearly in favour. And the Tories (Kenneth Clarke and a few friends apart) aren't.

There are many ifs, buts and interesting arguments to be had on the way, but note that Labour is now committed in principle to a key policy which the Conservative establishment - what one could call the political-media complex - is overwhelmingly against, and regards as virtually treasonable. Those moguls whom Blair has wooed will be horrified. And indeed, within hours of Mr Cook's interview there was the sound of hissing from The Sun and rasping, throat-clearing unhappiness from The Times: sleeping dragons awake.

This is an important moment which ought to remind Labour of the limits of the possible in its rapprochement with the great powers in the land. There was always a limit, always a choice to be made. And it is a choice, about what kind of government Blair wants to lead.

In the post-socialist world, there are only conservative governments, which sustain big concentrations of power, and radical governments, which break them up on behalf of the public interest and the underdog. These concentrations can be overmighty trade unions, monopolistic companies, supermarket cartels, EU institutions, officious quangos, or whatever. And it is perfectly possible for Tory governments to act radically, and Labour ones to act conservatively.

In this case, it would not be possible for New Labour to act radically if it was also obsessed with staying friends with all the interests and individuals it has been lobbying, and who have been lobbying it. A radical administration - unlike, perhaps, a party seeking power - has to make enemies. From the outside, it has been hard to tell whether Labour's charm offensive has been a brilliant pre-election guerrilla tactic - lightning strikes deep into the enemy's intellectual territory - or the start of a bold attempt to reshape the political map. New Labour, New Establishment?

The nightmare would be a Labour government that took a cynical decision to be anti-radical; to make deals with the powerful vested interests (whether it was the BMA, News International or Thatcherite businessmen) in return for a quiet life and soothing support. Far-fetched? It isn't so far from the behaviour of, say, Paul Keating's Australian Labor administration.

No one knows whether the New Labour move is a feint or a fundamental shift. But the dangers of being conservative are so much greater than the dangers of radicalism that I remain optimistic. A Labour administration which failed to challenge vested interests or assert a clear view of the public interest would, quite quickly, repel support.

So the mere fact that Cook was prepared to say something which was becoming politically unsayable was heartening. It suggested a refusal to be bullied. That doesn't mean that a Labour government could ignore business opinion - indeed, the politics of the single currency are partly about which business influence you think matters more, Toyota-style inward investors, or national newspapers. The only utterly destructive thing would be to take the country in a direction which subverted politics altogether. For Labour, as for the Tories, there are no easy answers. There are severe political problems with EMU which have led this newspaper to ask whether a single currency can be reconciled at all with a functioning democracy. On the other hand, the thought of Britain outside the EU's influential core is almost equally unappetising.

It might well be a country unable to attract inward investment; too weak to regulate its own markets; and too small to influence policy anywhere else. Its politicians would be, no doubt, bigger-looking, more colourful, sunlit figures on the national stage, free from the shadow of Brussels bureaucracy, loudly praised by the local press. But from a distance, they would look like irrelevant, squeaking midgets.

For our politicians today, the choice is not between national freedom and federal slavery; it is whether they prefer to share power with a cartel of European politicians or with a cartel of tycoons. I know which I'd prefer. And I think, and hope, that in its heart of hearts, Labour does too.

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