LEADING ARTICLE :Tony Blair's Newt Labour

For some time Tory optimists - reconciled to the inevitable loss of the next election - have cheered themselves up by comparing Tony Blair to Bill Clinton. They believe that Blair will share wobbly Bill's eventual fate, his left-of-centre agenda rejected after one short term in office. A rejuvenated right will then sweep to power on the back of a desire for small government, a return to traditional values and a revulsion against welfare dependency. Then they can get on with the revolution.

The speech early this morning by Mr Blair (regrettably to the assembled officer corps of Rupert Murdoch's mercenary army in their island paradise) suggests that he plans a very different outcome. It was a supremely confident effort, containing passages that would have been unimaginable from even this Labour leader a year ago. His speech showed how he has anticipated many of the popular themes that have characterised the recent success of Newt Gingrich and the US Republicans, and is now seeking to capture them for the centre-left.

Some of this agenda is familiar, if so far rather vague. Mr Blair's commitment to the family as a unit of social organisation is not new. What we still do not know is whether this formulation is to be used to strengthen the various types of family that exist in modern society - and if so, with what policy mechanisms - or narrowly and moralistically to prescribe what is good and what is not. The Labour leader's commitment to the devolution of government power to lower levels may not quite be Gingrich's headlong rush to "small government", but it is a cousin to it. Also related is the intention to reform welfare so that it is "a platform of opportunity, not a recipe for dependency". By and large this is good stuff.

But the most encouraging evolution in Tony Blair's thinking came in the section of the speech entitled "A True Meritocracy". Here Blair's central assertion was that "the left should reclaim the ground of the anti-establishment". He promises a crusade against privilege, against restrictive practices and against the limitations placed upon success.

This is, of course, precisely the crusade that John Major alluded to in his references to the classless society, but failed in every degree to lead. So Blair - a Labour leader - seeks to inherit the radical mantle that Margaret Thatcher's Tory successor let drop. It is this reforming impulse which we believe will be decisive in determining whether Labour can provide the leadership Britain needs in the early 21st century. If this can be combined with a robust internationalism - based upon a committed British role in a developing EU - as Mr Blair also argued in his speech, it will indeed be a thing of promise.

But there are still too few signs that Mr Blair's impulse is shared by his party. As policy documents are released by Labour, they consistently undershoot the target that all Mr Blair's rhetoric proclaims. At best they catch up with, but rarely ever transcend, the realities of privatisation, choice and free markets.

Tony Blair has achieved a great deal in his first year as Labour leader, defining new goals for his party. His second year now has to be spent in spelling out how these goals will be attained in harder policy terms. The fact that he continues to borrow shamelessly from the intelligent right on domestic policy indicates that the argument in British politics is by no means over.