I've been thinking about the strategic options open to the different parties in forming the next Government.
Things are simplest for Labour. They have two options: the first is to drop out of government and enter opposition gracefully; the second is offer the Liberal Democrats whatever they want to form a coalition. They have chosen the latter and will only leave Downing Street on being dragged kicking and screaming. That is rational in my view. The party is starved of funds, which won't be helped by going into opposition. They risk internecine warfare in the resulting leadership contest. They might make the transition from power to opposition cleanly after a decade in government, but the odds don't look good.
The question for the Conservatives and the Liberal Democrats is how accommodating they should be in coalition negotiations. The two leaderships are closer on policy (the Tory Left and the Liberal Democrat right) than the rest of the parties. So the key question will be what they can promise to the other party without causing infighting within their own.
The decision is complicated by the Conservatives having a second option - forming a minority Government. As has been written elsewhere, they could probably get quite a lot done in those circumstances as a lot of what they want to achieve can be done through secondary legislation, or is popular and Liberal Democrat friendly, enough that it will likely pass from a minority.
The decisive factor is how the two Conservative strategies - minority government and coalition - end. From there, we can work things out by backward induction.
Everyone has to be aware that with the strains of dealing with the fiscal crisis and a hung parliament there is every chance that this Parliament will not die a natural death after four or five years. The political fortunes of the two leaderships over the next decade may well hinge on how it ends. The manner in which the new parliament is dissolved will frame the issues and sentiment for the next campaign and the timing could affect the parties' finances.
If the Conservatives form a minority government then they have considerable discretion over how and when the Parliament ends. When the timing feels right they can start a fight over an issue where the public are on their side but the other parties will feel compelled to fight them; anything from Europe to a well constructed reform of party finance. The combination of being able to set up an election on an issue of their choosing and their financial advantage will allow them to do well politically as a minority government, as the Canadian Conservatives have. By contrast, in a coalition the Liberal Democrats will have a powerful ability - like that possessed by the Northern League in Italy - to take a stand at a time that suits them and force the Conservatives to either back down or break the coalition.
So I think that a minority government is probably the best political option for the Conservatives. But they mustn't look too keen on that outcome. They want to appear as if they are trying to work with the Liberal Democrats because anything else might look arrogant given their relatively modest electoral success. That means they have an incentive to look like they are offering a lot but still cannot work out a deal with the Liberal Democrats. By contrast, the Liberal Democrats are in a powerful position in a coalition and will ignore the promise of PR under Labour because they know that a minority coalition is a recipe for a complete mess.
The outcome of those sets of incentives - if the parties play their hands well - is probably a coalition where the Liberal Democrats don't get anything meaningful on the key points of contention - their tax plans and PR for example. Instead, they'll probably get a good range of personnel - I don't think Cameron is that attached to most of his Shadow Cabinet - and movement on the areas where the parties broadly agree. They'll accept that.
Things are simplest for Labour. They have two options: the first is to drop out of government and enter opposition gracefully; the second is offer the Liberal Democrats whatever they want to form a coalition. They have chosen the latter and will only leave Downing Street on being dragged kicking and screaming. That is rational in my view. The party is starved of funds, which won't be helped by going into opposition. They risk internecine warfare in the resulting leadership contest. They might make the transition from power to opposition cleanly after a decade in government, but the odds don't look good.
The question for the Conservatives and the Liberal Democrats is how accommodating they should be in coalition negotiations. The two leaderships are closer on policy (the Tory Left and the Liberal Democrat right) than the rest of the parties. So the key question will be what they can promise to the other party without causing infighting within their own.
The decision is complicated by the Conservatives having a second option - forming a minority Government. As has been written elsewhere, they could probably get quite a lot done in those circumstances as a lot of what they want to achieve can be done through secondary legislation, or is popular and Liberal Democrat friendly, enough that it will likely pass from a minority.
The decisive factor is how the two Conservative strategies - minority government and coalition - end. From there, we can work things out by backward induction.
Everyone has to be aware that with the strains of dealing with the fiscal crisis and a hung parliament there is every chance that this Parliament will not die a natural death after four or five years. The political fortunes of the two leaderships over the next decade may well hinge on how it ends. The manner in which the new parliament is dissolved will frame the issues and sentiment for the next campaign and the timing could affect the parties' finances.
If the Conservatives form a minority government then they have considerable discretion over how and when the Parliament ends. When the timing feels right they can start a fight over an issue where the public are on their side but the other parties will feel compelled to fight them; anything from Europe to a well constructed reform of party finance. The combination of being able to set up an election on an issue of their choosing and their financial advantage will allow them to do well politically as a minority government, as the Canadian Conservatives have. By contrast, in a coalition the Liberal Democrats will have a powerful ability - like that possessed by the Northern League in Italy - to take a stand at a time that suits them and force the Conservatives to either back down or break the coalition.
So I think that a minority government is probably the best political option for the Conservatives. But they mustn't look too keen on that outcome. They want to appear as if they are trying to work with the Liberal Democrats because anything else might look arrogant given their relatively modest electoral success. That means they have an incentive to look like they are offering a lot but still cannot work out a deal with the Liberal Democrats. By contrast, the Liberal Democrats are in a powerful position in a coalition and will ignore the promise of PR under Labour because they know that a minority coalition is a recipe for a complete mess.
The outcome of those sets of incentives - if the parties play their hands well - is probably a coalition where the Liberal Democrats don't get anything meaningful on the key points of contention - their tax plans and PR for example. Instead, they'll probably get a good range of personnel - I don't think Cameron is that attached to most of his Shadow Cabinet - and movement on the areas where the parties broadly agree. They'll accept that.
