Richard Grayson (former head of policy for the party and one of the leading lights behind the Social Liberal Forum) has written a thoughtful pamphlet for Compass about the different strains of thought within the Liberal Democrats and what they mean for coalition government.

The subtlety of some of Richard’s views mean you have to read the whole piece to do them justice, but a flavour of his interpretation of the so-called social liberal versus economic liberal difference is given by these extracts:

One other point needs to be made about the supposed social-economic liberal divide is that for the vast bulk of the party, the issues concerned in the debate are not pressing. In a thoughtful blog, party activist and thinker Iain Sharpe said of a speech I gave in Newcastle in February 2009, ‘I wince a little when I read Richard Grayson’s reference to “two approaches” to Lib Dem policy, “Orange Book” and “social liberal”.’ Iain went on to say, ‘This makes me feel more uncomfortable as I, and no doubt many other Lib Dems, don’t fall neatly into either camp, and don’t find them mutually exclusive.’10 On that basis, I think Iain was right to criticise what I said. I am certainly clear that such a divide does not exist for most members. As I shall argue below, the party is relatively under-factionalised. Indeed, ‘Orange Bookers’ are a very small section of the party, probably a much smaller section of the party than New Labourites were in their party – and they were never large in number. However, as labels for the directions from which much policy initia- tive has come, I defend the terms. While the party’s policy and principles have been broadly social liberal, a clear policy drive has come from the direction of The Orange Book…

How then does this narrative help us to under- stand the way in which the coalition has been greeted within the Liberal Democrats? Why has there not been more internal opposition? In the first place, we must not underestimate the extent of tribalist knuckle-headed Labour opposition to a deal with the Liberal Democrats. John Reid and David Blunkett were the tip of an iceberg in a party where many despise ‘the Liberals’. Such people lining up to tell the media that a period of opposition would be best for Labour was a terrible disappointment for those Liberal Democrats who were openly calling for a deal with Labour.

In contrast, the leadership has been able to put forward an argument, which finds much favour in the ranks, that the party is getting much from the coalition deal. All are agreed that the Conservatives offered much more than anybody would ever have imagined. As Polly Toynbee said of the coalition agreement, ‘There are policies here that Gordon Brown and Alistair Darling adamantly, and wrongly, refused to contemplate so wedded were they to New Labour’s rigid caution, triangulating themselves to death.’ That not only involves major constitutional reform but also a strong green strand and the sweeping away of some Labour legislation which posed threats to civil liberties. The leadership has been able to claim some success in the budget on matters as such as capital gains tax.

The most contentious section is where Richard argues that,

What the party still does not seem to recognise, or at least accept as a problem, is that the coalition can also be best understood as the preferred option of a leadership grouping which since it took over the party has consistently sought policies which will reduce the role of the state and steadily take a centre-left party to the centre- right. The major debates in the past two to three years have seen the small Orange Book tendency in the party steadily whittling away at broadly centre-left policies on, for example, the level of public spending, the level of income tax and roles of local government in education.

What I think Richard under-plays is the way the party’s attitude towards the state has changed not in response to different internal ideological views gaining ascendancy but rather in response to changing external circumstances. Given the huge expansion in public spending in the middle years of the Labour government, and the big expansion of central control in the early, middle and late years of Labour government, it is hardly a surprise that many who previously instinctively reached for more public spending and new regulations as the solution to problems now see both as having gone too far and a different emphasis needed instead.

You can read the full pamphlet below:

The Liberal Democrat Journal to a Lib-Con Coalition – Richard Grayson