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Steve Richards: Comrade Cable does No 10 a favour

The deficit remains the defining issue in British politics. Those who worry about the pace and depth of cutting do not have an ally in the Business Secretary

Thursday 23 September 2010 00:00 BST

The Liberal Democrats' conference has ended with a somewhat unexpected debate about whether Vince Cable is a revolutionary communist. The debate is silly and yet revealing. The silliness is easily explained. In his speech yesterday Cable said nothing he has not said before. Perhaps he expressed it in a more colourful language, but I wonder even about that. Admittedly he stated more clearly than Nick Clegg the central importance of the Liberal Democrats maintaining a distinct identity within the Coalition, but he also put the case for coalitions in general and for this one in particular. As for his revolutionary left-wing crusade, I am not especially surprised that David Cameron and George Osborne gave it the go-ahead in advance. Cameron and Osborne have bashed the bankers when it has suited them to do so. They have spoken of corporate responsibility too.

Probably they are more laid-back about these matters in practice than Cable, who once told me that his political hero was the former Labour leader John Smith (not that Smith was a Marxist revolutionary, either).

Conveniently for all involved, it was not clear from Cable's speech what the practical implications would be from his admirably blunt but generalised assertions about the widely accepted flaws of capitalism. Not even the most right-wing free marketeers in the Cabinet believe in wholly unbridled markets. They can relax about Cable's revolutionary intent.

Indeed the important point about Cable is the precise opposite to the one being implied in advance of his speech and afterwards. He supports the Cameron/Osborne plan to remove the deficit in a single parliament. Like his other Lib-Dem ministerial colleagues, he became a seemingly sudden convert over the weekend during which the Coalition talks were taking place and the election was safely over. Cable's support is invaluable to Cameron/Osborne and even more so now that some believe he is a Communist. When the impatient rush to cut begins, Cameron, Osborne, and Clegg can cite the backing of the Coalition's Che Guevara. At the Treasury they must be raising several glasses in gratitude.

The deficit remains the defining issue in British politics and the single area that will decide the fate of the Coalition. Yesterday the Liberal Democrats were thrilled to hear a bit of ideological passion from Cable, but those of them that worry about the pace and depth of spending cuts do not have an ally in the Business Secretary. Privately he is less gung-ho than Clegg over the deficit reduction plan. He has indicated that he will only cut in his department what he believes to be feasible, rather than meet an arbitrary target. But broadly Cable is an advocate of a policy that worries some Lib Dems and delights most Conservatives.

His support makes the reaction to yesterday's speech even sillier. The former Director General of the CBI, Digby Jones, suggested that Cable should keep his job but only "for now". The current head of the CBI, Richard Lambert, issued a statement giving Cable a bit of a telling-off. Parts of the media huffed and puffed.

Which is why the silliness is also revealing and slightly depressing. Why cannot the Business Secretary seek to address a lightly regulated market, or at least question the merits of unfettered capitalism? The acceptable debate has leapt from concerns about banks and the short-term recklessness of some businesses to one about the inefficiencies of the public sector. Savings in the public sector can and should be made, but surely it must be possible for public figures to highlight other issues without being portrayed as revolutionary Marxists.

Yet the younger Miliband has been christened "Red Ed" for daring to argue that the state has a role in regulating markets, and Cable is called a Marxist. Both are compared to Tony Benn for veering a millimetre away from Cameron/Blairite orthodoxy. It seems that the acceptable perimeters of debate in Britain are very narrow. The wacky reaction to Cable reminds me of a brilliant lecture that Gordon Brown delivered in 2003 in which he argued that while markets worked in most spheres, there were limits in one or two areas. The lecture was widely dismissed as a disastrous return to Old Labour.

Fortunately for Nick Clegg, he functions largely within the acceptable perameters of debate. Clegg possesses one essential quality for the leader of a third party: clarity of purpose and intent. Paddy Ashdown had the quality in his determined relationship with Tony Blair, preventing his party from being swallowed alive in the mid-1990s and making the Li Dems seem more important than they really were, as Blair headed for landslide victories. Charles Kennedy and Ming Cambell were less clear about the direction of travel, although Campbell was not given very long to navigate.

Clegg is ruthlessly clear and unswerving. He insisted at the election that the party that had secured most support should be given the first opportunity to form a government. Having negotiated a deal with the Conservatives, he decided to be a whole-hearted coalitionist and not a carping one. He does so on the assumption that the parliament will last a full term, at which point the parties will go their separate ways. If another hung parliament follows, the party with most support will be treated similarly. Several senior Lib Dems have been asked at the conference what Labour needs to do in order to establish a centre-left coalition. Their answer has been unequivocal: win more seats at the next election.

Clegg's speech reflected the clarity of purpose. I cannot recall a leader's speech that was so clearly expressed. There was nothing multi-layered about it, no coded messages or flowery passages that appeared to make one point, but really made another. He popped up on stage, put the case for this particular coalition at this particular time, and left again. Clegg knows what he is doing – quite unusual for a leader of a party.

But the downside of clarity is that the leader confidently navigating his chosen path can defiantly take the wrong turn. Clegg has made all the right calls except for one. His arguments for wiping out the deficit in a single parliament are as tendentious as those Tony Blair deployed in relation to Iraq. In his memoir, Blair asserts without any evidence that he feared Saddam would hand over weapons of mass destruction to al-Qa'ida terrorists. The fact that Saddam had no weapons and regarded al-Qa'ida as an enemy does not deter Blair from making this argument.

On the deficit, Clegg claims that, with the near collapse of Greece, Britain had no choice but to wipe out the deficit in a much shorter time frame. The leap makes little sense. Indeed he always adds the qualification that Britain's economy is not the same as Greece's. Yet this seems to be the reason why the comprehensive spending review is proceeding at such a pace that when Clegg headed for New York earlier this week, to address the UN, his senior staff rushed back to London from Liverpool to check on the progress of the cuts.

Like Cameron/Osborne, Clegg will be grateful that he has the support of his Marxist Business Secretary in relation to the cuts. As for the rest of the conference, it is waiting and seeing. Next year will be a bigger test, but do not expect a riot. As one senior MP, who is not a great fan of the relationship with the Conservatives, observed: "Even if things go wrong, we have nowhere else to go." Labour's new leader must be prepared for the long haul.

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