LABOUR'S LOST GAINS THE SEQUEL

Tony Blair only meant Clause 4 when he told Labour to think the unthinkable. Instead, Anne McElvoy offers the choices after the most unthinkable thought of all: defeat IT IS election night and all is not well in New Labour. The party's lead has been whittled down to six points. It has been the sunniest spring in years and the estate agents are happily counting their commis- sions. Consumer spending has been steadi- ly on the increase since the summer of 1996. The Tories had been recovering ever since a Guardian-ICM poll in the first week of August 1996.

The pundits agree that Labour has had the best of the campaign. Tony Blair's final speech, ending, 'Now is the time. It may not come again', was agreed to be one of the great rallying cries of a British election. John Major's message, 'Who do you really trust to run Britain?' seemed enervate in com- parison. But now look. Another 'Con hold' has just popped up on our television screens. The Tories are retaining 'key marginals' only recently given up for lost, and win- ning back seats sacrificed in by- elections since 1992. Some time in the early hours, the result is announced: a fifth consecutive Conservative victory with a margin of some 20 seats, just like last time. The nation shakes its head at the vagaries of politics and goes to bed. What happens next? Considering how fascinating this ques- tion is, the only wonder is that it has not been asked more often. It is a tribute to Blair's calibre as a politician that it is far easier to imagine him waving on the steps of No. 10 with Cherie at his side than it is to imagine him hunched in defeat. Neil Kinnock never quite passed this test. Blair has called on his party to 'think the unthinkable on Clause 4, taxation and eco- nomic management. Press and public opin- ion have followed suit, accepting for the first time since 1979 that a Labour government is not only thinkable but probable. The real unthinkable for the last year and a half, however, has been a Labour defeat. But slight tremors are rumbling — the old link between economic performance and the Conservatives' fortunes may be reasserting itself. Poll findings on whether the party's

popularity has suffered in the past few weeks vary. Blair's personal ratings have edged downwards. He still looks impres- sive, but he no longer looks invincible.

New Labour's own psychology on defeat is a mixture of horrified fascination and super- stitious denial that it could happen at all. When I interviewed Blair for The Spectator 18 months ago, he exuded a palpable fear of failure at a time when the Tories seemed convinced that their government was a lost cause. There are two people who still think Labour can lose, says one of his bright young aides. 'They are John Major and Tony Blair.'

Now Ken Livingstone, fresh from denouncing the 'bone-crunching pressure' exerted on the parliamentary party in the run-up to the shadow Cabinet elections, snaps down the phone: 'The idea of losing has never entered my head. It isn't even worth ten minutes of my time to talk about it.' Attempts to wheedle an opinion out of him by comparing the exercise to Fantasy Football fail lamentably: 'When I have fan- tasies, they are about far more exciting things. Goodbye.'

Tony Berm was even more outraged: `Would you have asked Churchill in 1940 what would happen if he lost?' he scolded. `This is not a fit subject for the eve of battle. I'm with Mrs Thatcher when she said of fail- ure, "The word simply does not exist."' The Left, it seems, is more blind to the possibility of defeat than the Right, possi- bly, as one right-winger sniped, 'because they want to repeat the cycle of buggering up a Labour government', Ask- Blair's loyal lieu- tenants what would happen if Labour failed to win the election, and they are simultane- ously repelled and fascinated. 'I might have known you'd have come up with a wrecking idea like that,' said one. Again, the phone was slammed down. Others seemed strange- ly drawn to discuss the terms of their own destruction with morbid zeal, on the strict understanding of eternal anonymity.

`It would', says one, 'be a defining moment for Labour and far worse than any other defeat because we have come so far in the last two years and done everything we can possi- bly think of to win.'

Kinnock took the 1992 defeat as a judgment on his personal abilities and stood aside to let John Smith lead. Would Tony Blair remain leader of the Labour Party if he too were to 'lose? His close friends believe that it is far from certain that he would stay. 'Tony would absolutely hate another five years as leader of the Opposition,' says one, 'he does not enjoy it at all. He has seen the job as a hoop you have to jump through.' In the past few weeks, Blair has taken to intoning a mantra of frustration 'which expresses his eagerness for power. 'The bane of your life in Opposition,' he has said, 'is that in govern- ment you wake up and think, "What shall I do?" In Opposition you wake up and think, "What shall I say?"' So he might decide that his leadership was a once-only offer to break the mould — like the SDP challenge of 1983 — and decide to return to the more ordered world of the Bar. The attractions of his family life would also be considerable. In that case, he would want the crown to pass to Gordon Brown. This is not necessarily because Blair thinks that he is the right man for the job — Brown can be prickly and is said by those who have worked with him to lack organisational skills — but because this was the unspoken part of the deal agreed between the two men at the `Granita sum- mit', the meeting between Blair and Brown in an Islington restaurant after John Smith's death. That night, Brown agreed not to oppose Blair for the leadership.

As leader, Brown would embrace EMU more readily than Blair and the emphasis would change from the current visionary style of leadership to a more dour, more pragmatic presentation. Brown would also demolish the current kitchen Cabinet. Out, for instance, would go the most powerful grey cardinal, Peter Mendelson. The result would be a less slick, grimmer Labour which emphasised its links with 'ordinary people' rather than courting middle-class professionals.

The on dit in Blair's circle is that there would not be an outright challenge from within the shadow Cabinet if Blair wished to stay on. It is indeed hard to imagine what anyone in this circle could accuse him of that they had not themselves lavishly sup- ported — at least in public. 'There would be a natural desire to blame him,' says a back- bench supporter, 'but what could we say he was guilty of? It is one thing to have an emotional yearning for the past but quite another to propose a return to it.'

That does not rule out a rogue challenge from the Left, perhaps from Ken Living- stone or Tony Benn. Margaret Beckett, the least comfortable member of Blair's team, might even be tempted to have a go. John Prescott is probably too old. A Left-Right confrontation would be the real test of how successful Blair's attempt to hoist the party into the centre ground has been. So far, the membership has only been consulted on carefully devised issues like the reform of Clause 4 and the Road to the Manifesto. In both cases, Blair has had control of the questions asked and the form in which they were proposed. It would be quite different if the Left were confronting a beaten lead- er, accusing him of not only selling out the party's birthright but having failed to win power by so doing. As far as many con- stituency activists are concerned, the only validation for the revisionism of the last two years is electoral success. 'New Labour', says one, 'is the sell-out that dare not speak its name.'

'Like Gaitskell, Blair would be unloved in defeat,' says David Carlton, historian and Warwick University lecturer, who has fought seats for both Labour and the SDP. 'There would be a strong reaction against him and he would be a beleaguered leader. His autocratic manner means that he would not inspire the admiration that Michael Foot has continued to command despite leading the party to disaster.'

The nearest parallel is the 1959 defeat of Gaitskell. Immediately afterwards, Douglas Jay and Woodrow Wyatt declared that the party had lost because it had not moved far enough to the Right and proposed the end- ing of Clause 4 and a name change. Within a year, a serious battle for the soul of Labour had broken out. Gaitskell won it and would probably have triumphed in 1964 (he died in January 1963), but he had to fight hard to regain his authority. So would Blair.

Much will depend on how severe and unexpected a Blair defeat was. If the lead were ground down steadily up to polling day and the Tories squeaked back in with a smaller majority than last time, Blair would probably be able to steady the party quickly and hope to force another election within a couple of years. If Labour were seen to have lost the plot during the campaign, revealing the full extent of its own splits and strains, or the Tories (let's really think the unthinkable here) were to increase their majority, Blair would be far harder hit.

One joker remains in the pack, namely Robin Cook, shadow foreign affairs spokesman. Intellectually adept and pos- sessed of undiminished ambition, he might find it hard to stand by and watch a van- quished Blair lead for another five years. There is an outside chance that he might stand against Blair — of all the senior shadow Cabinet, he has most visibly kept his independence and distinctive beliefs. He would certainly make a grab for the leader's mantle if Blair were to stand down and propose Brown as his successor. Cook would then propose an entire remoulding of the Left and centre Left into a 'rainbow coalition' of the cuddlier Socialist tenden- cy, some Liberals, Greens, united under the banner of proportional representation. The difficulties in such enterprises are leg- endary. 'But Robin', says a former aide, 'is the only person with the tactical and men- tal ability to pull it off.'

Whether under Blair or Cook, the party would be tempted to renew its on-off flirta- tion with PR. The impact of yet another Tory win would re-open minds to the theo- ry that the electoral system is weighted in the Conservatives' favour and that the only way to oust them is in an alliance. Paddy Ashdown has already made it clear that he would not co-operate with Labour without securing a commitment to PR. Labour would probably prefer an electoral pact guaranteeing the Liberal Democrats some Cabinet posts. 'But why', asks Charles Kennedy, the Liberal Democrat Member for Ross, Cromarty and Skye, 'would we do that — other than to be dumped on from a great height if Labour won?'

The ill-fated Lib-Lab pact of Callaghan's government immunised many Liberals against moving too close to Labour. 'We got all of the blame and no credit,' says Michael Taylor, MP for Truro. With his party now seen as the natural opposition to Labour in inner-city constituencies, grass- and concrete-roots Lib Dems are keener on building up a base in local government than on grand alliances.

A merger of the Labour and Liberal Democrat heartlands makes a deal even harder to envisage. To look convincing, a pact between Labour and the Liberal Democrats, still more a merger of the two into a single new party, would have to involve Labour candidates standing down in favour of Liberal Democrats and vice versa. Otherwise, it would look as if the new pact, or the new party, was just the two old parties under one new name — with the old two keeping their regional strongholds. The new grouping would not look particularly new. But Labour, and to a lesser extent the Liber- al Democrats (with their South-western sup- port) come in regional clumps, whereas Conservative seats are more widely spread. A Labour MP in the North-east, where in most constituencies the Liberal Democrats are considered a mere irritant, would be unwilling to stand aside and allow a Liberal Democrat to take the seat and the glory. The same goes for the Liberal Democrats in their strongholds. 'Down here,' says Taylor speak- ing from his West Country constituency, 'the only reason that you would vote for Labour rather than for us is that you absolutely loathe us.' Not a promising basis for cheerful co-operation.

Scotland presents its own problems. 'PR might not lead to an effective alliance, but to general fragmentation,' says David Carl- ton. 'One of the problems of the Liberals standing aside would be that the votes would not automatically transfer to Labour, but to the Scottish Nationalists. That might happen to a lesser extent in Wales with Plaid Cymru. And even in Eng- land it is likely to beef up support for Arthur Scargill's Socialist Party.'

PR looks a far better option for Labour from a distance than up close and cruelly personal. So maybe the bruised party would want to be alone with its grief, and at times like that people can turn to strange com- forters. The final fantasy scenario, one which had a surprising amount of support in our random poll of Labour's secret dreams, is the 'Come Back, All is Forgiven' option, namely, the return of Neil Kinnock from the self-imposed exile of Brussels. 'He is still immensely popular,' says one fan. 'All the party managers and their men could not stop him getting a seat, and after that, who knows?' Mikhail Gorbachev, after all, contin- ues to fight presidential elections in Russia.