The excitement started Monday afternoon when, as the Conservatives and Liberal Democrats were still holding their negotiations, Gordon Brown emerged from 10 Downing Street to announced that Lib Dem leader Nick Clegg had approached the Labour Party to see what they could offer instead. And, most dramatically, Brown announced that he would be resigning as leader of the Labour Party.
That announcement soon sparked breathless speculation throughout the media. Gordon Brown stepping down was considered by many to be a precondition for a Liberal Democrat – Labour coalition. Surely, the media inferred, Brown would not have made that dramatic (and rather humiliating) announcement unless some kind of deal had been worked out. For the rest of the day Monday the assumption was that some kind of Lib-Lab coalition was being formed. The problem of course was that a Lib-Lab union would still not meet the threshold of reaching a majority in the parliament.
Thursday’s vote had yielded.
Labour seemed to be hit with a burst of enthusiasm Monday night, with all of the old Blairite politicians, most notably Peter Mandelson, racing gleefully from building to building in Whitehall with big smiles on their faces. But as the night turned to day, those smiles were giving way to expressions of anguish. By Tuesday morning it was clear those negotiations were not going well. And then the knives came out. Labour backbench MPs were in revolt, and they soon made their displeasure quite public. One after the other Labour MPs began appearing on TV trashing the idea of a “rainbow coalition”, saying it would not have legitimacy with the public and would be dubbed the “coalition of the losers” since both parties lost seats on Thursday. There appeared to be real fear within Labour that forming such a government was not in the party’s long-term interest. The fear was that as unpopular as they’ve become, they could doom themselves to near pariah status by clinging to power by the edge of their fingernails, while at the same time presiding over a period that will require brutal cuts in public services. The party is better off going into opposition, they reasoned, where they could dump Brown for a new leader, rejuvenate the party, and sit back and watch as David Cameron is forced to take unpopular measures to deal with the economic mess Britain is in. But the Blairites at Number 10 were still intent on forming a deal that would keep them in power.
All hail the new PM
Cameron pulled up to the residence and went to a hastily set up microphone in the middle of the street. Shouting above the noise of the helicopters overhead, and the demonstrators nearby, David Cameron hurriedly gave a beleaguered inaugural speech and then rushed inside the residence. There would be a Lib-Con coalition, he announced, and Nick Clegg would become deputy prime minister.
However no further details about this new government were yet known, and it was still not known if the parties would approve the decision reached by the two leaders. But late last night the parties approved the deal, and this morning details have slowly emerged about the make-up of the new government. According to the agreement reached, four Liberal Democrats will take cabinet posts in the first coalition government Britain has had since World War II. They have agreed on a five year fixed-term parliament, meaning the next election will not take place until May 2015.
But this coalition will be rocky, and already there are signs that Lib Dem voters are furious about this arrangement. The two parties are extremely different, especially when it comes to taxation and Europe. And out in the constituencies, it is not exaggeration to say the parties absolutely hate each other. In many ways the Lib Dems are to the left of Labour, so their alliance with a centre-right party is going to be a hard pill to swallow for Lib Dems on the ground.
Senior Lib Dems were at pains last night on TV to try to soothe this anger, saying that they had no choice but to ally with the Tories. A Labour alliance would not have worked mathematically, they said, and the only other alternative was to leave the Tories to form a minority government by themselves and call an election later that the Conservatives probably would have won outright.. ‘We had to choose between allowing the Tories to form an unmitigated government or joining with them to modify the worst of their policy goals’ they were insisting.
But have they really been successful in doing that? On the two main issues that separate the parties, tax and Europe, they seem to have won little concession. According to the agreement released today, the Lib Dems will have to go along with the Tory plans for big spending cuts that the Lib Dems opposed during the campaign. The coalition government will cut £6bn in spending over the course of this year and unveil a new emergency budget with more cuts in the next 50 days. The Lib Dems have agreed to drop their plans for a “mansion tax” on properties costing more than £2m, and in return the Conservatives have dropped their plan to raise the inheritance tax threshold to £1m – not exactly an equal trade-off I’d say. The Tories have not agreed to drop their plans for a marriage tax break. The Lib Dems have also been made to drop their opposition to replacing Britain’s Trident nuclear missile system. And on electoral reform, the Lib Dems have gotten a referendum on the Alternative Vote system, which is not the system they wanted.
Most notably, the Lib Dems seem to have gotten no concessions from the Tories on their hardline stance toward Europe. The agreement says that the Lib Dems are going along with the Tories' quixotic plan to try to gain retroactive exclusion from the working time directive. There will also be no transfer of powers from London to Brussels during this parliament. That presumably includes the current attempts to set EU-wide regulations on the financial sector, as President Obama is introducing in the US. The first test for that will come next week at the finance ministers' meeting. The Lib Dems have agreed to hold a referendum on any future EU treaty (on the treaty itself rather than on membership in general as the Lib Dems had wanted), and have committed that this government will never adopt the euro. Britain will not submit to an EU public prosecutor. The Lib Dems have even agreed to consider a "UK Sovereignty Bill" that would basically just be a big middle finger to Brussels. In fact the "Relations with the EU" section of this pact seems to have nothing nice to say about Europe, only a list of complaints and demands.
The Death of the Lib Dems?
It was an unenviable lose-lose situation for Liberal Democrats. Had they allied with Labour they risked infuriating the public by seeming to disregard the election result. But by allying with the Tories they have infuriated their party members and caused many people to leave the party for Labour. Had they abstained from allying with either party they would have lost what was perhaps a once-in-a-lifetime opportunity to be in government, and would likely have lost more seats when the Tories eventually called a new election. So whatever they did here they were going to make a lot of people angry.
But as Labour MP Diane Abbott was pointing out last night on Newsnight, the Lib Dems run a real risk now of fading into irrelvency as a party. Junior coalition partners often have a habit of fading into the woodwork, especially if they don’t have a high-profile cabinet post which appears to be the case here. This is why in Germany the junior coalition partner is always guaranteed a high-profile post, the foreign minister.
The Lib Dems are now part of a conservative government, which means they have lost their ability to claim to be the voice of progressives in the UK. Labour will now become the progressive opposition, and they are assured to get a huge number of Lib Dem converts joining their ranks. Come the next election, it’s hard to see how the Lib Dems aren’t going to lose seats, even if they are successful in passing voting reform. They will either be remembered as traitors or will be thought of as just being part of the conservative government. And if by the time of the next election you like what’s been going on, you might as well just vote Conservative.
There is also real doubt about whether electoral reform will pass in this referendum that has been promised. The Conservatives have already said that though they will hold a referendum on voting reform, they will campaign against it. Labour will also most likely campaign against it. And given that these past few days have been so chaotic and have engendered ill-will from the public toward the Lib Dems, my prediction is the public will overwhelmingly vote ‘no’ to voting reform in the referendum.
As regards Europe, it will be interesting to see how this plays out. New Foreign Secretary William Hague doesn’t seem to have any plans to ratchet down his plans to go to war with the EU. And if Lib Dems aren’t in the foreign ministry, its hard to see what they can do to stop him. It’s possible that the Conservatives’ actions toward Europe could become so distasteful that the Lib Dems revolt. However it’s also equally possible that the presence of the Lib Dems in government will force the Tories to moderate their EU stance, and to put the issue on hold for awhile to avoid antagonizing their new partners. Eventually though, some kind of EU issue is going to come up that will divide the two partners. And given that the Conservative Party is already divided within itself on the Europe issue, it could get very messy indeed.